we know embedded solutions - Data Respons · Has leading global partners Is number one in the...

06annual report

we know embedded solutions

EMBEDDED SOLUTIONSEmbedded solutions means integrated solutions, and they can be described as the brains of a machine or system. They are solutions that can be used in a broad range of industrial applications, such as fighter jet radar systems, control systems for DVD vending machines and network solutions for video conferencing equipment. Data Respons’ vision is to be a leader in the European market for embedded solutions by 2010.

NETWORK SOLUTIONS for video conferencing equipment

CONTROL SYSTEM for DVD vending machines

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CEO’S STATEMENT 04 Doors are opened to specialists

DATA RESPONS06 This is Data Respons08 Solutions10 Certified Solutions12 Products14 Services16 How embedded solutions are built

MARKETS22 Defence2� Telecom24 Offshore / maritime25 Industry

ORGANISATION28 Our values29 Why work for Data Respons?�0 Active in several arenas�1 Group management

INVESTOR INFORMATION�4 DAT shares�5 Key growth drivers�6 Key figures

ANNUAL REPORT�9 Board of Directors40 Directors’ report

FINANCIAL STATEMENTS AND NOTES44 Financial statements50 Accounting principles5� Notes71 Auditor’s report

EMBEDDED SOLUTIONS

RADAR SYSTEMS on board fighter jets CONTENTS

FINANCIAL CALENDAR

26.04.2007 Presentation of 2007 Q1 results26.04.2007 Annual General Meeting12.07.2007 Presentation of 2007 Q2 results18.10.2007 Presentation of 2007 Q� results�1.01.2008 Presentation of 2007 Q4 results

5CEO’S STATEMENT | DOORS ARE OPENED TO SPECIALISTS

By allowing specialists to help make future technology choices when embedded solutions are to be upgraded or developed, you will have greater assurance that the technology that is chosen is future- oriented, provides increased functionality and improves profitability in the long run. In addition, you will also get the specialist’s experi-ence and expertise in an important phase of the product’s life cycle as an added bonus.

technological jungleThe topography of the embedded market is far more complex than the standardised PC world. There are many operating systems and various platforms and architectures to choose from. In addition, there are countless suppliers from the US, Europe and Asia. An ex-tremely high level of resources is therefore required to navigate this technological jungle.

Data Respons has spent a long time creating a global network of suppliers, and we receive continuous information on developments in the embedded market. We have close relationships and many years of experience. This increases the accuracy of our choices and gives our customers greater security.

cost savings The embedded market is developing at break-neck speed. To be competitive, our customers must implement new technology at an ever-increasing tempo. Every year Data Respons participates in many development processes for advanced products and solutions.

Upon completion of the development and quality assurance, we ar-range an efficient production run until the next generation.

Time and time again we see that the transition to a new technol-ogy platform not only provides better functionality, it also provides significant cost savings as well. This has created new opportunities for our customers. Some of them have established themselves in new markets, others have been faster to market a new product, and some of them have strengthened their niche dominance.

everything from a single supplierA large number of embedded solutions are still being built in-house by companies. This trend is about to turn. Over the last five years even the most technologically conservative companies have decided to open their doors to the specialists. Therefore more and more customers are choosing Data Respons as an end-to-end supplier of embedded solutions – for choice of technology, development and delivery.

Doors are opened to specialistsThe challenge for many companies is to meet the demands for faster product development, implementation of new technology and maintenance of a com-petitive cost structure at the same time. These challenges can be solved at an early stage.

Kenneth Ragnvaldsen, CEO, Data Respons ASA

6 DATA RESPONS | THIS IS DATA RESPONS

a concept adapted to the customers needsData Respons offers, through the company’s three business areas, an overarching concept that gives its customers several paths to coopera-tion adapted to their own needs.

solutionsDevelops tailored solutions by combining customised HW/SW with advanced computer products from inter-national partnersIs involved in one or more phases of the solution’s life cycle (design, development, delivery, new generation)Is a strategic partner for the customer

servicesOffers a broad range of embedded solu-tions, expertise and servicesProvides resources when the cus-tomers need themParticipates in many development projects for customers in differ-ent industries

productsOffers a comprehensive selection of embedded computer productsHas leading global partnersIs number one in the Nordic region

This is Data ResponsData Respons’ vision is to be a leader in the European market for embedded solutions in the industrial market by 2010. Our ambition is to improve our cus-tomers’ competitive position by delivering optimal embedded solutions from both a technical and commercial perspective.

KARLSRUHE

ÅRHUS

SØNDERBORG

BERGEN

HELSINKIKONGSBERG

OSLO

STOCKHOLM

GOTHENBURG

COPENHAGEN

LINKÖPING

7

38 %29 %

20 %13%

REVENUE BY BUSINESS AREAREVENUE BY INDUSTRY

local presenceThe development of embedded solutions is driven by the customers’ needs and technological opportunities. For Data Respons, a local presence is necessary for establishing good cooperation and developing long-term customer relationships. Data Respons has therefore established several local offices in Norway, Sweden, Finland, Denmark and Germany.

global presenceData Respons has cooperated with world-leading partners from the USA, Europe and Asia for several years. This cooperation offers a number of advantages from which our customers derive significant benefits. Our network provides a global presence and flexibility, which contributes to an efficient and solution-oriented cooperation environ-ment. Data Respons continuously receives information on new devel-opments in the embedded market from the company’s suppliers.

everything from a single supplierData Respons is a technology partner for OEM companies, system in-tegrators and product suppliers in market segments such as defence, offshore, automation, medical equipment, transport and telecommu-nications. Our customers operate in a market that involves complex deliveries to demanding customers. Many customers desire a close relationship with a single supplier who can provide end-to-end solu-tions. This is due, for example, to:

Increased specialisation – customers must focus increasingly on their own core expertiseGreater demands – customers experience an increasing demand for advanced functionalityLess time – customers are facing tougher demands to reduce the “time to market”High R&D costs -customers need more cost-effective R&D

profitable growthData Respons ASA is listed on the Oslo Stock Exchange (Ticker: DAT) with wholly owned subsidiaries in Norway, Sweden, Denmark, Finland and Germany. Data Respons is ISO certified (ISO 9001:2000) in Norway, Denmark and Sweden.

In 2006 Data Respons reported record revenue of NOK �9�.0 million, which corresponds to growth of 47% compared with 2005, and a record profit of NOK 22.� million, which represents year-on-year growth of 68%. At the end of 2006 the company had 226 employees, compared with 141 at the previous year-end.

DEFENCE

OFFSHORE TELECOMS

INDUSTRY

61 %18 %

21 %

PRODUCTSSOLUTIONS

050

100150200250300350400

SERVICES

OPERATING REVENUE 1986-2006 (MNOK)

VISIONA leader in the European market for embedded solutions by 2010

8”

SolutionsThe ability to deliver embedded solutions that combine computer products and expertise adapted to specific customer requirements has given Data Respons a leading position in the embedded solutions market in the Nordic region.

DATA RESPONS | SOLUTIONS

Shorter development time and technologically complex products means that an increasing number of customers are choosing to pur-chase embedded solutions from Data Respons instead of doing every-thing themselves.

customisationCustomers have specific requirements for embedded solutions. This may involve the solution needing to communicate with existing sys-tems, satisfy specific form factors or performance requirements, or operate in an environment that is exposed to vibrations, pressure or temperature fluctuation. On account of this, standard computer tech-nology will rarely work in a satisfactory manner, and it will need to be customised for each individual customer.

What these solutions have in common is the fact that they require sophis-ticated technology consisting of both advanced IT modules from niche players throughout the world and custom electronics and software.

quality is all about the right attitudesThe trend and development towards production runs for embedded solutions is creating new quality assurance needs. Data Respons is ISO certified (ISO 9001:2000) in Norway, Denmark and Sweden.

One of Data Respons’ strengths is that both the company and individual employees have the right attitude towards quality assurance. Companies rarely achieve certification on their first attempt without any non-conformance.

Helge M. Myrseth, Bureau Veritas Quality International

characteristics of solution customersMarket leading OEM companies specialising in various industriesVolume deliveries of 50 – 5,000 units to end customers each yearSolutions needing special certification in accordance with environ-mental and standardised user and government requirementsIndustrial customers in established markets with increasingly re-petitive solution deliveriesDesire access to local follow-up and expertiseOn the lookout for partners for the development of embedded solutionsFocus on cost-saving programmes

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Yara prevents the formation of toxic gas in sewage systems

“We chose Data Respons because they have a high lev-el of expertise in HW and SW development, and they have good supplier contacts, which we can benefit from when we need to choose the right, independent off-the-shelf products. In addition, it was an absolute re-quirement that our business partner was ISO certified.”

Anette Æsøy, Manager of Yara Industriutvikling

DATA RESPONS | SOLUTIONS

Yara believes that the Nutriox system has great future po-tential in Europe and the US.

DVD vending machines in the US are operated remotely from Sweden

“The initiative from Data Respons has given us an advantage that none of our competitors have. We can deliver a machine with higher quality at a lower cost. In addition, we can concentrate on what we do best – developing software and engaging in business development.”

Kristian Silbvers, Managing Director, Instant DVD

Data Respons has performed a to-tal system audit for Instant DVD’s new generation of vending mac-hines for DVD film rentals.

Flow Computers to FMC Kongsberg Metering’s fiscal metering systems

“Our cooperation with Data Respons guarantees us access to a high level of expertise in embedded so-lutions and the solution from Data Respons gives the lowest ownership costs over time.”

Thor A. Ulveraker, Manager Purchasing, Contract & Global Sourcing, FMC Kongsberg Metering

Data Respons has delivered the next generation of Flow Computers to FMC Kongsberg Metering’s fiscal metering systems for the oil and gas sector.

Broadband on trains attracts more passengers to first class

“Data Respons has proved its ability to take overall responsibility. They have experience of dealing with international customers such as Ericsson, SaabTech and ABB, and they are backed by leading interna-tional partners. This is reassuring.”

Frederik Gustafsson, CEO of Icomera AB

Icomera can offer a patented and tested solution for unin-terrupted Internet connection on board trains.

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fighting the elements

11DATA RESPONS | CERTIFIED SOLUTIONS

Certified SolutionsData Respons offers OEM solutions to customers that are subject to strict gov-ernment requirements. This includes the maritime sector, defence segment, medicine, transport and equipment for oil/gas and the process industry.

High demands are placed on the operational reliability of equipment that is to be installed on vessels or oil platforms. Due to harsh mari-time environments with temperature fluctuations, vibrations, shocks, salt spray, etc., the equipment must possess very special qualities.

The typical customers for certified solutions are manufacturers of navi-gation systems, chart systems, systems for steering and propulsion, monitoring, engine room control and fire control. This may involve deliveries to tankers, cruise ships or military vessels, such as aircraft carriers or frigates.

broad product rangeData Respons can offer a broad product range of small microBox PCs, large server solutions, LCD monitors and scalable panel PCs.

responsible for the certification processData Respons not only provides solutions that can be certified, but we also assume responsibility for the entire certification process on behalf of the customer. In addition, we arrange the assembly, testing and qual-ity assurance of the certified solutions. Data Respons has engineers with over 10 years of certification experience. In addition to knowledge and experience, importance is also attached to being solution-oriented and having the ability to listen to and understand customers’ needs.

The combination of Data Respons’ overall expertise, dedicated engi-neers for certified solutions, strong partner structure and “in-house” system integration and testing makes Data Respons a solid supplier of certified solutions and products.

certified by classification companiesThe products meet all the requirements of IEC-60945 and IACS E10, and they are certified to withstand extreme temperatures, shocks, vi-brations and salt spray. These classification companies place high de-mands on the computer equipment that is used. The purpose of this is to reduce the risk of loss of life and property.

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ProductsData Respons’ customers have access to a comprehensive selection of embedded computer products from world-leading partners. The product portfolio covers all relevant industrial standards and can be used for any industrial application.

broad rangeData Respons has embedded computer products for HW, SW, connec-tivity, leading process architecture and operating systems.

AdvancedTCA CompactPCI Computer-On-Modules Enclosures Industrial PC LCD monitors Mass storage Motherboard & SBC Panel PC PC/104

world-leading partnersOver time Data Respons has built up a large, solid network of leading suppliers of third-party products, platforms and systems from the USA, Europe and Asia.

These are tried and tested products of high quality that we deliver to customers, either separately or as elements in customer specific solu-tions.

Our long-term cooperation contributes to an efficient and solution-oriented cooperation environment, which gives the customers priority and flexibility in relation to their own requirements and deadlines.

DATA RESPONS | PRODUCTS

EU

ROPE

U

SAA

SIA

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What technology is your company gambling on?Following all the developments in the embedded market is very re-source intensive.

Data Respons is continually updated on develop-ments in the embedded market – a technological jungle only very few of our customers want, or have the resources, to follow.

Data Respons provides advice on technological choices adapted to the customers’ requirements. We evaluate existing solutions, suggest alterna-tives, find possible cost-reductions and generally help the customer make the right choices.

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technology partnerData Respons has specialists that perform demanding devel-opment and design assignments for industrial customers.

Our specialists become part of the customer’s development environment and contribute their expert knowledge, experi-ence and the ability to deliver.

Data Respons has experienced project managers who can take care of ongoing resource management, risk assessment, non-conformance control, testing and supplier management.

flexibilityData Respons is a business partner to OEM companies, sys-tem integrators and product suppliers in different industries. We offer resources where the need is greatest through our flexible cooperation model.

Insourcing. Data Respons strengthens the customer’s devel-opment team by making its expertise and experience avail-able to the customer in the customer’s own environment. This gives the customer updated knowledge, contributes to the stimulation of development of their product and ensures ef-ficiency during product development.

Outsourcing. Data Respons develops the customer’s product in its own premises, and it places its development model, ex-pertise, and last, but not least, its efficient project management tools at the disposal of the customer. This ensures efficient product development, special expertise and minimisation of the risk of errors. We pride ourselves on meeting deadlines, and delivering at the right price with the right quality.

Strategic partner. As a strategic partner we enter into very close cooperation with the customer. Both parties make a concentrated effort to achieve common strategic goals. This means that we also invest in joint development, by, for ex-ample, investing in new platforms, technologies, resources, expertise and facilities.

DETTE ER DATA RESPONS

ServicesData Respons offers experienced specialists with a broad range of expertise from different disciplines in embedded solutions. In addition, the company’s overall experience has come from countless complex and expertise demanding devel-opment projects in various industries over the course of a number of years.

Flexible and available expert knowledge

15

EXPERTISE

preliminary studyRisk and cost analysisRequirement specificationsEngineeringChoice of technology

system designArchitectureAnalysis and designRequirement and test

specifications

hardware developmentMechanical developmentRFAnalogue/digitalHigh SpeedPowerEMC/environmental testsSchematic drawingsPCB outlayLab tests

firmware VHDL logic VHDL SoC

software developmentAnalysis and designDriversBuilding environmentFrameworkApplication designSourcing �rd party softwareRT(OS): Linux, Win32, pSOS, WinCE, VxWork, IntegrityLanguages: C, C++, C#, Java

16

Development flow:Choice of technology platformChoice of supplierDevelopment of customised HW and SWCertification of prototype, FAT

2.DEVELOPMENTOur knowhowEmbedded solutions must be adapted to each individual customer. This requires expertise in a broad range of disciplines, combined with a complete product port-folio of third-party embedded computer products.

DATA RESPONS | HOW EMBEDDED SOLUTIONS ARE BUILT

how embedded solutions are built

TemperatureVibrationMoistureSecurityForm requirements

Performance requirementsEMCCertification

1.SPECIFICATIONYour requirements – our working dayYour requirements may be determined ba-sed on what environmental conditions your products will be exposed to. This may invol-ve temperature fluctuations, vibrations or humidity. In addition, there may be special adaptations, such as form or performance requirements. Or the authorities may re-quire certification. We devote our working day to meeting your requirements.

Specification requirements:

17DATA RESPONS | HOW EMBEDDED SOLUTIONS ARE BUILT

how embedded solutions are built

Data Respons offers:Efficient and scalable productionComprehensive local testing facilitiesCustomer specific assemblyCertification according to international standardsCustomised logistics

3.DELIVERYAssembly, testing and deliveryData Respons handles small and large pro-duction runs that cover assembly, testing, labelling and logistics. We offer compre-hensive testing facilities and cooperate with test laboratories. This gives us an op-portunity to customise the requirements the customer wants to document, by, for example, environmental testing or various types of certification.

Typical problems:Life Cycle ManagementEnd Of LifeUpgrade

4.NEW GENERATIONTechnical/commercial perspectives The correct choice of technology not only safeguards the development of a future-oriented solution, it also ensures oppor-tunities for significant cost savings. Our ambition is to improve your competitive position by delivering the best embedded solutions in both a technical and commer-cial perspective.

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REFERENCE CUSTOMER: ICOMERA AB

Read more at www.datarespons.com/icomera

19

Data Respons has developed a patented solution that provides an uninter-rupted Internet connection on trains in cooperation with Icomera.

Icomera’s solution combines GSM, GPRS and satellites, and it ensures that the train has a stable In-ternet connection even at high speeds. On board the train the traveller can connect via WLAN, and this solution can handle around fifty users on each train. Data Respons’ delivery includes development of circuit boards for communication, including, driver routines, adjustment of mechanics, as well as cabling, testing and integration with the customer’s system.

an uninterrupted Internet connection on trains

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Different markets are distinguished by their own re-quirements based on conditions and adaptations that are necessary for an embedded solution to work satis-factorily. Common to all of them is the fact that they must be adapted to suit each individual customer.

MarketsData Respons has developed solid in-dustry expertise over time in offshore, defence, telecommunications and in-dustry in general (medical, transport, automation). This expertise is vital for the development of embedded solu-tions that satisfy the needs of our cus-tomers.

MARKETS

21

OFFSHORE�-Phase Measurement (NO)FMC Kongsberg Metering (NO)Roxar (NO)Kongsberg Maritime (NO)WesternGeco (NO)Odim (NO)Rolls-Royce Marine (NO)L3 Valmarine (NO)Saab (SE)Thrane & Thrane (DK)

DEFENCEKongsberg Defence & Aerospace (NO)Kongsberg Protech (NO)Kongsberg Defence Communication (NO)Patria (FI)Saab (SE)Terma (DK)Ericsson Microwave Systems (SE)

INDUSTRYABB (NO, FI, SE)Brüel og Kjær (DK)GE Healthcare (SE)Banedanmark (DK)Volvo (SE)Yara (NO)Danfoss (DK)SECTRA (SE)MAN B&W Diesel (DK)Novo Nordisk (DK)

TELECOMPark Air Systems (NO)Ericsson (SE)Nera (NO)Anritsu (DK)Tandberg Telecom (NO)Thales (NO)Taide Network (NO)Icomera (SE)GN Store Nord (DK)

22 MARKETS | DEFENCE

DefenceData Respons has a role as a supplier of cutting-edge technology in the defence market. Our customers are major system suppliers who supply turnkey systems to various sections of the defence industry throughout the world.

typical applicationsControl and communication systemsPassive sensors and warning systemsAutonomous command and control sys-tems for air, land and sea applicationsSystem solutions for sonar and radarFire control systems

trendsIncreased new investments in high-tech equipment, sensors and weaponsPrinciple of a network-based defence (NBD) which is interoperable with the other members of the NATO allianceNew technology platforms that contribute to increasing self-protection, intelligence, surveillance and reconnaissance (ISR), as well as C�i systems (Command, Control, Communication and Information)Traditional weapons systems and indi-vidual equipment will be upgraded to advanced fire control and sensor systems

2�MARKETS | TELECOM

Telecom Constant work on projects for the telecommunications industry has given Data Respons extensive experience from relevant application areas in this market.

typical applicationsInfrastructure and system solutions for mobile networks�G, GPRS, VoIP applications, media gate-ways, satellite communications, switches, wireless information systems and M2M solutionsTesting and simulation systems

trendsConvergence towards IP-based hardware with more of the development focusing on software, which will reduce entry barri-ers for new playersTransmission of live images and large quantities of data will place heavy de-mands on infrastructureIP-based wireless local access WLAN (802.11x) in-house and as a general data and voice service (IP zones)Global consolidation leading to standard-ised platforms such as ATCA

24 MARKETS| OFFSHORE / MARITIME

Deliveries in the offshore and maritime industry require good insight into ap-plications, government requirements (certification) and knowledge of external stress factors such as pressure, temperature fluctuations and vibrations. Data Respons has supplied extensive solutions to major players and developed cut-ting-edge expertise in these markets.

Offshore / maritime

typical applicationsCertified maritime solutionsControl systems for steering and navigat-ing shipsAdvanced process control in the oil and gas industry, generally aimed at subsea applicationsMetering systems for oil and gasCollection of seismic dataControl systems for cranes, handling equipment and engines

trendsHigh oil prices are hastening the develop-ment of more expensive and technologi-cally demanding oil fields Old installations will be modernisedGrowth in the market for metering oil, gas and water (flow computers) Major investments in the development of equipment suitable for subsea installations, particularly in the market for control systems, communications and multiphase metering

25

Data Respons’ extensive application experience from many years of building systems makes us a valuable partner in industry projects for OEM companies, system integrators and vertical product suppliers in various sectors of industry, including automation, medical equipment, surveillance and transport.

MARKETS | INDUSTRY

Industry

typical applicationsSystem solutions for the control, com-mand and surveillance of machinery, cars, structures, etc.Wireless monitoring of critical physiologi-cal parameters in the medical industryCertified solutions for the automotive/transport industry

trendsIncreasing use of distributed I/O systems and Ethernet communication in the auto-mation industry – a trend that looks likely to gain momentum in the near futureRobust, inexpensive PC solutionsMore electronics for the surveillance and control of technical functions, as well as the integration of vehicle information systems

26

OCAS AS has developed a solar powered radar system in cooperation with Data Respons that warns pilots when the aircraft is in areas near aviation obstacles such as power lines, wind farms, bridges and masts.

Data Respons surveyed what requirements the system had to satisfy, made the necessary adaptations and documented the system in ac-cordance with the government requirements. OCAS received the En-gineering Feat of the Year award in 2006, which is voted on by the readers of the Norwegian magazine Teknisk Ukeblad. Read more at www.datarespons.com/ocas

REFERENCE CUSTOMER: OCAS AS

warning pilots of obstacles in the air

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Organisation Data Respons strives to be customer-oriented in everything we do. Employees who are successful with us are given challenging projects and access to a unique and professional working environment. The company has a strong corporate cul-ture built on shared attitudes and values. We place emphasis on social activities because they strengthen solidarity among our employees.

taking overall responsibilityExtending and committing ourselves to make each other better.

achievingWillingness to succeed, acquire new knowled-ge and dare to find new ways of achieving our goals.

being generousBeing open, inclusive and willing to share knowledge.

having funWe laugh with, instead of at each other.

ORGANISATION | OUR VALUES

Our values

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preben r. myrvollPosition: Principal EngineerEmployed since: 1997Education: Advanced engineering degree from the University of Colorado

great opportuynity to control your career“Data Respons is academically very strong in embedded solutions, and the organisation is characterised by a great willingness to share knowledge between employees. It has a corporate culture that aims to make each other professionally strong. This means that we develop expertise, and that more employees excel in many areas, which in turn means increased flexibility for the organisation,” says Preben.

reasons for working at data respons?“On the project side, we have a significant say in the roles and responsibilities we would like to take on. This means that we can, in general, control our professional development and what areas we want to work in. In addition, we are a social and inclusive company and have an active sports environment.”

anne pierre-duplessixPosition: Senior Development Engineer Employed since: 2006Education: Université Pierre et Marie Curie, Paris VI

open working environment“Data Respons has a very open and pleasant working environment. Communication between the employees is very good, and it is easy to get help for small and large challenges. We have a young working environment, and the employees have a clear common trait – a thirst for knowledge. Our employees are very focused on learning more, and I find this to be very positive,” she says.

reasons for working at data respons?“Data Respons has a social and open working environment. You will have an opportunity to test yourself in many different projects, and it is easy to get help when you need it.”

magnus gidlundPosition: Strategic Account Manager, Data Respons AB Employed since: 2004 Education: Technical graduate from KTH Stockholm

high tempo – open communication“Data Respons is a company with a high tempo and is characterised by open communication, high levels of expertise and challenging assignments. We have a good mixture of self-development, pro-fessional focus and business. In addition, Data Respons is a successful and financially stable company, and this influences our employees,” says Magnus.

reasons for working at data respons?“Because you get good terms, challenging assignments and can have fun in a company that is successful!”

Why work for Data Respons?

ORGANISASTION | WHY WORK FOR DATA RESPONS?

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social environmentData Respons emphasises social and sports activities be-cause they strengthen solidarity among the employees. The employees therefore regularly meet to participate in joint activities and events.

Many Data Respons employees are active cyclists. Several employees participate in various bicycle races throughout the year, such as Birkebeinerrittet, Raumerittet, Grenserittet and MTB Vättern. There are also many enthusiastic skiers among our employees, and Birkebeinerrennet and Skarver-ennet are two races that many employees have participated in for many years.

Once a month we go to a pub. The annual summer party, where employees from all countries participate, is an im-portant arena for creating good team spirit across national borders.

humanitarian workFor several years Data Respons has purchased Christmas cards and given an annual donation to the humanitarian organisation On Own Feet. This is an alternative to giving gifts to customers, partners and employees.

The essence of On Own Feet’s work is children helping oth-er children to help themselves. Through the sale of hand-made Christmas cards, the children have raised money for various projects.

In 2006 Data Respons contributed to the following projects:

Medicine and schooling for 52 HIV and AIDS-infected children in Thailand and Cambodia

Purchase of a minivan for a psychiatric hospital in Oparany in the Czech Republic

A new school in Bosnia-Herzegovina

Active in several arenas

ORGANISATION | ACTIVE IN SEVERAL ARENAS

The willingness to succeed, a thirst for knowledge and a passion for technol-ogy characterises employees throughout Data Respons’ organisation. These are key elements for succeeding in this market, but it is just as important that our employees maintain their health and well-being. Data Respons therefore places significant emphasis on ensuring that our employees have the opportunity to be active in several arenas other than in their jobs.

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KENNETh RAgNvALDSEN CEO

Number of shares: 245 000 Number of options: 300 000

Kenneth Ragnvaldsen (born 1967) trained as a business economist and has an MBA from the Norwegian School of Management (BI). He worked in finance, sales and marketing for three years before starting at Data Respons in 1995. He was previously the sales and marketing director of Data Respons ASA. Ragnvaldsen was appointed CEO in 200�.

hANS ChRISTIAN LøNSTAD CTO


Hans Christian Lønstad (born 1960) has a Master of Science degree and a doctorate in cybernet-ics from the Norwegian University of Science and Technology (NTNU). He has worked at Data Respons since 1995, and previously spent four years as a researcher at SINTEF. He also worked for GE Vingmed for five years. Lønstad was appointed CTO in 2003.

RUNE WAhL CFO


Rune Wahl (born 1966) trained as a business economist at the Norwegian School of Manage-ment (BI) and has an MBA from INSEAD. He has previously been the Director of Finance at Tandberg Storage and Avenir ASA, and has also held various management positions in Emen-tor, Frionor and DNV. Wahl was appointed CFO in 2005.

ORGANISATION | GROUP MANAGEMENT

Group management

ÅgE gjELLESvIK vICE pRESIDENT SALES


Åge Gjellesvik (born 1961) trained as an engineer and has many years’ experience of working as a system designer. In the spring of 1998 he established the first branch office in Bergen. After holding several management positions at Data Respons Norge AS, he was appointed Vice Presi-dent Sales for Data Respons ASA in the autumn of 200�.

gEORg A. hUUS MARKETINg DIRECTOR


Georg A. Huus (born 1969) trained as an economist at the Norwegian School of Economics and Business Administration (NHH). For eight years he worked as a consultant at Geelmuyden.Kiese. Huus was appointed Marketing Director in 2006.

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Data Respons has developed important components of the next-genera-tion GAREX voice communication systems for air traffic control in coope-ration with Park Air Systems.

Data Respons has developed two processor cards for the next generation GAREX Voice Control Com-munication System. Data Respons evaluated the design outlines that Park Air Systems had prepared, and was subsequently hired to perform the preliminary project and then the design and development of the cards. The reason why Data Respons was chosen as a partner was the desire for a quick delivery of the solution, flexibility, expertise in embedded products and a good understanding of customers’ needs.

REFERENCE CUSTOMER: PARK AIR SYSTEMS

��

Read more at www.datarespons.com/pas

NEXT-GENERATION VOICE COMMUNICATION FOR AIR TRAFFIC CONTROL

Voice Control Communication

System

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trading volume and share priceA total of 47.4 million DAT-shares were traded on the Oslo Stock Exchange in 2006, compared with 41.5 million shares in 2005. The number of transactions registered on the Oslo Stock Exchange was 7,228 in 2006, compared with 5,109 in 2005. The average number of transactions per day was 29 in 2006, compared with 20 in 2005.

shareholder structureAs of �1 December 2006 the company had 1,087 shareholders, �6 of which were foreign shareholders. Combined, the foreign shareholders owned 8.1% of the company in 2006, compared with 9.67% in 2005. At the end of 2006 Data Respons ASA owned 6�,000 of its own shares. See note 8 for the 20 largest shareholders as of �1 December 2006.

analyst coverageFive brokerages cover Data Respons:

Company AnalystABG Sundal Collier Ivar BlekastadCAR Knut VidjelandEnskilda Thomas LieKaupthing ASA Thomas NielsenOrion Securities ASA Stig R. Myrseth

Investor information Data Respons ASA is listed on the Oslo Stock Exchange (Ticker: DAT), and is included in the information technology index. The company has offices in Den-mark, Finland, Norway, Sweden and Germany. The company had 226 employees at the end of 2006.

DAT-shares

26.04.2007 Annual General Meeting

26.04.2007 Presentation of 2007 Q1 results

12.07.2007 Presentation of 2007 Q2 results

18.10.2007 Presentation of 2007 Q� results

�1.01.2008 Presentation of 2007 Q4 results

FINANCIAL CALENDAR 2007

DAT 2006 2005

Highest price 14.75 1�.90

Lowest price 10.60 9.�0

Closing price 12.65 1�.90

Average number of transactions per day 29 20

Market Cap �1 Dec (NOK million) 467 465

Number of shares �1 Dec (million) �6.9 ��.5

RISK amount per share 01.01 0 0

SHARE DATA

INVESTOR INFORMATION | DAT-SHARES

SHARE PRICE PERFORMANCE

DAT OSE Information Technology

7

9

11

13

15

2004 2005 200670

90

110

130

150

170

190

DATOSE45

50

15

1�

11

9

7

190

170

150

1�0

110

90

702007200620052004

�5

0

50

100

150

200

250

300

350

400

GROWTH IN THE END-USER MARKET

The demand for embedded solutions is driven by an even greater demand for new functionality and increasing com-plexity and technology content in the products for OEM companies, system integrators and product suppliers.

Data Respons has systematically built up a customer base with broad market access, which provides good exposure to the demand for embedded solutions in different seg-ments of the market.

Key growth drivers Defence

Telecommunicatons

Industry

Offshore / Maritim

20%

13%

38%

38%

SALES BY INDUSTRY 2006

INVESTOR INFORMATION | KEY GROWTH DRIVERS

GROWTH IN OUTSOURCING

Our customers continuously meet demands for new func-tionality and increasing technology content, which en-tails continuous upgrades and product development with shorter times to market. The complexity is increasing. The expertise needed to develop embedded solutions is very specialised, and it is often beyond the scope of the custom-er’s core expertise. This has resulted in many companies choosing to purchase complete data solutions, rather than develop everything themselves.

050

100150200250300350400 Solutions Products Services

2002 20062004

REVENUE BY BUSINESS AREA

ETABLISHMENT IN NEW MARKETS

Organic growth is the primary focus of Data Respons. Data Respons has a tried and tested business model that contrib-utes to rapid establishment in new markets. A strong global partnership structure provides access to leading technology and competitive terms.

New establishment areas are under continuous evaluation. A local presence is necessary in order to maintain close contact with customers and expand our customer base.

REVENUE, 1986 - 2006

Bergen: 1998

Copenhagen: 1999

Stockholm: 2000Kongsberg: 2000

Helsinki: 2002

Karlsruhe: 2005

ACQUISITIONS

Data Respons constantly focuses on acquisition opportu-nities that can contribute to strengthening the company’s position in the form of expertise, market access and an im-proved customer structure. This provides a foundation for the development of new solutions customers, whether they are existing product or service customers.

POSITIONING MATRIX

SERVICESCentrex ASEmbedit A/SSyrén Software AB

PRODUCTSCertified Computer Technology AS (CCT)

PRODUCTSMemstore AB

LOW HIGHPRODUCT FOCUSLOW

HIGH

FOC

US

ON

EX

PER

TISE

SOLUTIONS

400

�50

�00

250

200

100

150

50

0

�6

NOK 1 000 2006 2005 2004 2003 2002

income statement

Operating revenue �9� 04� 267 156 240 406 179 �28 15� 895

Operating expenses �70 786 25� 9�7 226 29� 182 149 146 27�

EBITDA 22 257 1� 219 14 11� (2 821) 7 621

Depreciation and amortisation 2 794 1 827 1 941 2 605 2 908

Operating profit/loss 19 46� 11 �92 12 172 (5 426) 4 71�

Profit/loss before tax and minority interests 20 �59 11 409 11 821 (5 026) 5 086

Net profit/loss after tax �8 407 8 104 8 094 (7 17�) � 947

balance

Total assets �66 449 2�7 5�4 176 7�4 118 841 61 604

Equity 2�5 722 152 104 104 289 75 51� 18 570

Bank deposits 29 411 48 266 45 158 22 444 5 �25

key figures

Revenue growth 47,1 % 11,1 % �4,1 % 16,5 % 28,� %

Gross margin 46,� % 46,9 % 48,2 % 51,1 % 61,2 %

EBITDA-margin 5,7 % 4,9 % 5,9 % -1,6 % 5,0 %

EBIT-margin 5,0 % 4,� % 5,1 % -�,0 % �,1 %

Net profit margin 9,8 % �,0 % �,4 % -4,0 % 2,6 %

Cash flow from operations (2 448) (12 188) (� 009) (� 0�9) (18 088)

Return on equity 19,8 % 6,� % 9,0 % -15,2 % 2�,9 %

Return on total assets 6,4 % 5,5 % 8,2 % -6,0 % 8,9 %

Liquidity ratio 215,6 % 2�0 % 200,0 % 170,0 % 170,0 %

Equity ratio 64,� % 64,0 % 59,0 % 6�,5 % �0,1 %

Working capital 72 882 44 427 19 809 7 166 5 604

key figures for shares

Earnings per share (EPS) 1,07 0,26 0,27 -0,29 -�,76

Cash flow per share (0,07) (0,�9) (0,11) (0,11) (0,5�)

Dividend per share - - - - -

Book equity per share 6,4 4,5 �,5 2,8 �,0

Number of shares as of �1 December �6 880 246 �� 469 264 29 665 464 26 778 164 26 778 164

Average number of shares �5 728 782 �1 197 0�2 29 415 000 26 778 164 25 191 449

Average number share transactions per day 29 20 4 2 2

Share price as of �1 December 12,65 1�,90 9,50 9,40 4,90

Market capitalisation 466 5�5 465 22� 281 822 251 120 1�0 904

Key figures

0

50

100

150

200

250

300

350

400

20062005200420032002

OPERATING REVENUE PER YEAR (MNOK)

-5

0

5

10

15

20

25

20062005200420032002

EBITDA PER YEAR (MNOK)

0

50

100

150

200

250

300

20062005200420042002

ORDER RESERVE PER YEAR (MNOK)

INVESTOR INFORMATION | KEY FIGURES

�7INVESTOR INFORMATION | KEY FIGURES

norway KEY FIGURES

MNOK 2006 2005Operating revenue 228,1 167,2EBITDA 27,4 19,2Order reserve 15�,0 106

Employees 12� 9020052004 20062003

0

50

100

150

200

250

2002

SHARE OF SALES

58 %

OPERATING REVENUES (MNOK)

sweden KEY FIGURES

MNOK 2006 2005Operating revenue 72,8 47,9EBITDA 1,8 1,�Order reserve 59 45

Employees �9 2020052004 20062003

01020304050607080

2002

SHARE OF SALES

18 %

OPERATING REVENUES (NOK million)

denmark KEY FIGURES

MNOK 2006 2005Operating revenue 81,2 48,2EBITDA 2,2 0,6Order reserve 42 19

Employees 55 1820052004 20062003

0

20

40

60

80

100

2002

SHARE OF SALES

20 %


germany KEY FIGURES

MNOK 2006 2005Operating revenue 11,� �,2EBITDA -2,7 -1,8Order reserve 11 �

Employees 7 �20052004 20062003

0

2

4

6

8

10

12

2002

SHARE OF SALES

2 %


f inland KEY FIGURES

MNOK 2006 2005Operating revenue 7,8 4,8EBITDA -0,8 -1,�Order reserve 4 2

Employees 2 �20052004 20062003

012345678

2002

SHARE OF SALES

2 %


�8

Annual report

�9

Tormod Stene-Johansen (born 1964) has been a member of the Board since March 2000. He has extensive experience from retail trade and the establishment of com-panies in new markets. In recent years Stene-Johansen worked as an independent business developer and investor focusing on the Baltic States.

TORMOD STENE-JOHANSENMEMBER OF THE BOARDShares: 60 000 Share options: 0

Ingvild Myhre (born 1957) was elected to the Board in April 2006. She is the Group Chief Executive in ID Gruppen/Network Norway and has previously been the Presi-dent and CEO of Telenor Mobil AS and Di-rector of the Norwegian Red Cross. She is a member of the Board of Telecomputing, the Norwegian National Insurance Scheme Fund, Simrad Optronics, Consorte, Simula Research Lab and Narvik Science Park.

Mikkel D. Helweg (born 1966) was elected to the Board as an employee representa-tive in May 2004. He has worked at Data Respons since 1999 as a salesman, sales manager (products) and is currently a Key Account Manager at our Kongsberg office. He has previously worked as a salesman, product manager, sales manager and mar-keting manager in various companies in the computer/network/electronics sector.

MIKKEL HELWEGEMPLOYEE REPRESENTATIVEShares:1 601 Share options: 0

Øyvind Lien (born 1972) was elected to the Board as an employee representative in April 2006. He gained an advanced engi-neering degree in signal processing from the Norwegian University of Science and Tech-nology (NTNU) in 1997. He has worked at Data Respons since 1999. Lien is one of Norway’s leading experts in embedded electronics and currently works as a Princi-pal Engineer at Data Respons’ Høvik office.

ØYVIND LIENEMPLOYEE REPRESENTATIVEShares: 27 511 Share options: 0

INGVILD MYHREMEMBER OF THE BOARDShares: 0 Share options: 0

SVEIN RAMSAY GOLI CHAIRMAN OF THE BOARD

Shares: 150 000 Share options: 0

Svein Ramsay Goli (born 1940) was elected as Chairman of the Board in April 2006 and has been a member of the Board since 2002. He is the Board Chairman of Norman ASA and member of the Board of Visma ASA and Fara ASA. He was previously a sales director at IBM and subsequently Vice President of Oracle with responsibility for the Nordic region. Goli currently works primarily through his own compa-nies, with a primary emphasis on ICT and business consultancy.

Lars-Olof Gustavsson (born 1943) was elect-ed to the Board in April 2006. Gustavsson is one of the founders of Four Season Venture in Sweden and Norway, and is currently the Board Chairman of Four Season Venture Capital AB and Four Season Venture II AS, Broström AB and Finja Betong-Group. He is also a Director of Siem Industrikapital AB, Siem Capital AB, SJ AB, Emotron AB and Mikroponent AB.

LARS-OLOF GUSTAVSSONMEMBER OF THE BOARDShares: 1 000 Share options: 0

Anne-Cecilie Fagerlie (born 1958) was elect-ed to the Board in April 2006. Fagerlie is the CEO of Avanade. She has an advanced engi-neering degree in computer science from the Norwegian Institute of Technology (NTH) and in economics and management from the Norwegian School of Management (BI). Fagerlie is a member of the Board of Nordic Semiconductor ASA, yA Bank og Forsikring, and the Research Council of Norway.

ANNE-CECILIE FAGERLIEMEMBER OF THE BOARDShares: 0 Share options: 0

ANNUAL REPORT | BOARD OF DIRECTORS

Board of directors

40

2006 highlightshigh growth rate in 2006Record sales of NOK 393.0 million (+47% from 2005)Record EBITDA of NOK 22.3 million (+68% from 2005)Record incoming orders of NOK 502.0 million (+45% from 2005)Record orders on hand of NOK 269.0 million (+61% from 2005)

embedded solutions from a single supplierThe Solutions business area grew by �7% to NOK 241.1 million and accounted for 61% of total sales in 2006.

investments in skills and in a strong sales apparatusWe implemented many cutting-edge technology projects in partner-ship with our customers in 2006. We made investments in our sales and marketing organisation, and the sales staff made up about 29% of our workforce at the end of 2006.

strategic acquisitions outside norwaySvenske Memstore AB has a strong position as a supplier of memory, data storage and embedded solutions to the market in the Nordic re-gion, primarily in Sweden and Denmark.

Danish Embedit A/S is a market-leading development company focus-ing on embedded hardware and software that elevates Data Respons from its challenger position to a leading player in the embedded mar-ket in Denmark.

statement on the annual financial statementsThe company fulfils the requirements necessary to operate as a going concern, and the 2006 financial statements have been prepared on the basis of this assumption. As a listed company Data Respons ASA prepared the consolidated financial statements for the Data Respons Group for the financial year 2006 in accordance with IFRS (Interna-tional Financial Reporting Standards).

income statementThe report includes comparisons with figures for the same period in 2005 (in brackets).

Data Respons’ operating revenue in 2006 was NOK 393.0 million (267.2 million), representing growth of 47%. The group’s EBITDA was NOK 22.� million (1�.2 million), representing growth of 68%. The profit before tax was NOK 20.4 million (11.4 million).

The company’s Board is very satisfied with the growth in revenue and improvement in earnings. The integration of acquired units is proceed-ing according to plan and is making a positive contribution to Data Re-spons’ progress. The company’s vision is to be a leader in this market in Europe by 2010.

The group has invested in strengthening the organisation throughout 2006 to lay the foundation for continued growth. The priority areas include marketing, development of skills and the sales force. In ad-dition, the group has improved its overall Solutions concept by es-tablishing an integration centre in Norway (first quarter) and Sweden (third quarter).

Incoming orders totalled NOK 502.0 million (�48.0 million) for the period. This gives a positive “book to bill” (factor 1.28) and shows that the company is positioned for further growth going into 2007.

The total number of employees as of �1 December 2006 was 226 (141).

balance sheet, liquidity and cash flowThe group had total assets of NOK �66.4 million as of �1 December 2006. The company’s equity totalled NOK 235.7 million, representing an equity ratio of 64%.

Data Respons ASA owned 6�,000 of its own shares at the close of the year. None of the company’s own shares were bought or sold in 2006.

The group’s liquidity is good. Cash and cash equivalents as of 31 De-cember 2006 totalled NOK 29.4 million. Current assets totalled NOK 190.8 million and current liabilities totalled NOK 88.5 million.

Fixed assets of NOK 175.7 million comprise deferred tax assets of NOK 40.1 million and other intangible assets of NOK 127.7 million.

The fixed assets of NOK 175.7 million represented other intangible assets of NOK 127.7 million and recognised deferred tax assets of NOK 40.1 million. Based on the improved earnings and the Board’s assessment of the future earnings development, previously unrecognised deferred tax assets have been recognised in 2006.

Increased revenue for 2006 resulted in a build-up of inventory and accounts receivable from customers, which has resulted in a negative cash flow from operations of NOK -2.4 million. The net cash flow amounted to NOK -19.8 million for the financial year, primarily due to payments in connection with acquisitions.

operationsData Respons supplies embedded solutions to leading OEM compa-nies, system integrators and vertical product suppliers in a number of market segments such as defence, offshore, automation, medical equipment, surveillance, transport, telecommunications and industry in general.

Data Respons ASA is listed on the Oslo Stock Exchange (Ticker: DAT) and is included in the information technology index. The group has operations in Norway, Sweden, Denmark, Germany and Finland.

Data Respons is exposed to limited interest rate risk, exchange rate risk, credit risk and other financial risks. The company’s main finan-cial market risks are linked to pensions (return on pension assets), ex-change rate fluctuations (relating to goods purchased for resale) and credit risk (on accounts receivable in connection with ordinary busi-ness activities). To minimise the credit risk, all customers are subjected to credit checks.

marketsnorwayOperating revenue for 2006 was NOK 228.1 million (165.� million), representing growth of �8%, and EBITDA totalled NOK 28.4 million (19.2 million), representing growth of 48%. Orders on hand totalled NOK 15�.0 million (106.0 million) as of �1 December 2006, repre-senting growth of 44%.

The market conditions are good in Norway. Data Respons is well-posi-tioned and anticipates a continued positive development in 2007.

denmarkOperating revenue for 2006 was NOK 81.2 million (48.� million), representing growth of 68%, and EBITDA totalled NOK 2.2 million (0.6 million). Orders on hand totalled NOK 42.0 million (19.0), rep-resenting growth of 120% as of �1 December 2006.

After the acquisition of Embedit, Data Respons is now the largest player in the embedded solutions market in Denmark. Data Respons anticipates continued positive developments in 2007.

swedenOperating revenue for 2006 was NOK 72.8 million (47.9 million), representing growth of 52%, and EBITDA totalled NOK 1.8 million (1.� million), representing growth of �6%. Orders on hand totalled NOK 59.0 million (45.0 million) at the end of the quarter, represent-ing growth of �1%.

Directors’ report

ANNUAL REPORT | DIRECTORS’ REPORT

41

The growth in Sweden was linked to the acquisition of Memstore AB. The integration of Memstore AB has gone according to plan and was completed during 2006. Organic growth was lower than expected due to delays in deliveries by the Solutions business area to a large defence customer.

In January 2007 Data Respons acquired Syrén Software AB. The company is an embedded solutions specialist in automotive technology, telematics and telecommunica-tions. The company’s head office is in Gothenburg, and it has 26 employees. The company posted sales of SEK 2�.0 million in 2006 and a profit of SEK 2.8 million. This acquisition strengthens Data Respons’ skills plat-form and geographic distribution in Sweden.

finlandOperating revenue for 2006 was NOK 7.8 million (4.8 million), and EBITDA totalled NOK -0.8 million (-1.� million). Orders on hand totalled NOK 4.0 million (2.0 million) as of �1 December 2006. A successful restruc-turing of Finland to a branch office managed by Data Respons Sweden was carried out in 2006.

germanyOperating revenue for 2006 was NOK 11.� million (�.� million), and EBITDA totalled NOK -2.7 million (-1.8 million). Orders on hand were NOK 11.0 million (�.0 million) as of �1 December 2006.

Germany is the largest market for embedded solutions in Europe. Data Respons established itself in the Ger-man market in 2005 and is still in a start-up phase. The group will invest in increased sales resources, skills de-velopment and marketing to ensure growth in 2007. In addition, acquisitions are being considered as part of a future growth strategy.

business areasData Respons allocates its sales to three business areas: Solutions, Products and Services.

solutionsOperating revenue in 2006 for Solutions totalled NOK 241.1 million (176.1 million), representing growth of �6.9%.

Solutions can boast good growth and represents 61% of total sales in 2006. A key reason for this growth is a good supply of new Solutions customers, in addi-tion to the fact that the average size of the contracts has increased. There was good supply of customers for Solutions in all of the company’s regions. Deliveries by Solutions give rise to long-term customer relationships and create good opportunities for increased sales.

productsOperating revenue in 2006 for Products totalled NOK 8�.0 million (64.9 million), representing growth of 27.9%.

Products sales showed continued growth in volume. Data Respons is positioned as a leading channel for em-bedded solutions products in the Nordic region.

servicesOperating revenue in 2006 for Services totalled NOK 68.9 million (25.7 million), representing growth of 168.2%.

The market conditions for services are good. The com-pany has had a satisfactory supply of Solutions projects

The trend towards outsourcing is increasing. This means that many companies are choosing to purchase end-to-end data solutions instead of developing everything themselves.

42

and development assignments in 2006. It is expected that the capacity utilisation will be good in the future.

organisational structureAt the close of 2006, Data Respons ASA had 226 employees working at twelve offices in Norway (12�), Sweden (�9), Denmark (55), Fin-land (2) and Germany (7).

The average number of employees at the parent company during the financial year was 1�.4. The average number of employees in the group was 177. At the end of the year, the group had 42 female employees. There was a total of five female middle managers. There are currently no women members of group management. Equal pay for work of equal value, regardless of gender, is emphasised at Data Respons. The pay and terms of employment for comparable positions are the same for women and men. The company aims to make it possible for individual employ-ees to achieve a good balance between work and their families.

work of the boardIn 2006 there were seven Directors on the Board, five of whom were elected by the general meeting and two of whom were elected by the employees. The Board generally meets nine times a year, and otherwise as required. In 2006 the Board held a total of 10 meetings.

The work of the Board is governed by detailed rules of procedure. The Board also has an annual programme of work including specific topics and fixed items such as the approval of the annual financial statements, interim financial statements and budgets. The Board is also responsible for overall strategy and for setting long-term goals, as well as important decisions about acquisitions, establishing overseas opera-tions and major investments. In 2006 there were five men and two women on the Board.

corporate governanceaims and guiding principlesThe principal aim of Investor Relations at Data Respons is to create confidence through the equal treatment of all stakeholders in terms of access to financial information. All shares have equal rights and are freely transferable. Data Respons has one class of shares, and each share carries one vote. Data Respons shall comply with the require-ments set out in the Norwegian Companies and Accounting Acts at all times. The company shall also aim for transparency in relation to financial matters, to help capital markets, shareholders, customers and suppliers assess the company’s situation and future potential.

Data Respons believes that it is important to have an open and ac-tive dialogue with the stock market, where all shareholders are treated equally. The company has been awarded the Oslo Stock Exchange’s Information Symbol for good information practices.

the annual general meetingThe general meeting is the highest decision-making body of the compa-ny, and it elects the shareholders representatives and their deputies to the corporate assembly. Complete documents and background informa-tion relating to general meeting motions are to be sent out no less than 14 days prior to the meeting being held. Provisions are made for the use of proxies if shareholders are unable to attend the general meeting.

nominating committeeData Respons has two nominating committees. One committee is elected by the general meeting and makes proposals to the general meeting regarding the election of shareholder-elected members to the Board. The other nominating committee is for the election of em-ployee representatives to the Board. A nominating committee for share-holder-elected members was appointed at the general meeting in 200�. The committee consists of Nils Henrik Petterson, Håkon Sæter and Rune Sørum, and the committee’s mandate is to nominate candidates for shareholder-elected Board members and propose directors’ fees.

Data Respons believes that it is impor-tant to have an open and active dia-logue with the stock market, and all shareholders are treated equally. The company has been awarded the Oslo Stock Exchange’s Information Symbol for good information practices.

4�

board of directorsThe Board of Directors of Data Respons is responsible for the group’s strategic development, and it shall keep itself informed at all times of the company’s financial position, as well as adopt plans and budgets for the business. The Board’s role, responsibilities and work methods have been defined thoroughly in the rules of procedure that were adopted in 2005. The rules of procedure also define the tasks and duties of the Chief Executive Officer in relation to the Board in greater detail.

The composition of the Board of Directors complies with the require-ment that the Board be independent from the company management, and independent from major business associates of the company. The Chairman of the Board of Directors is elected by the general meeting. Board members are elected for a term of two years. Page �9 of the financial statements provides a detailed description of the individual members’ backgrounds, qualifications and shareholdings.

company capitalThe company’s equity is appropriate for the aims, strategy and risk profile communicated to the market. If the capital exceeds the need for realisation of the company’s strategic goals, the company will pay a dividend. The company is currently in a growth phase where it is de-sirable to reinvest earnings from operations to ensure further growth, since this is regarded as the most appropriate for the creation of value for the shareholders. The company aims to finance its working capital needs from the anticipated revenue growth through its own resources. Beyond this the Board will continuously evaluate the company’s equity needs in connection with possible acquisitions or other investments.

An increase in the company’s equity will only be proposed if the Board of Directors believes that it will be in the long-term interests of the shareholders. For significant capital increases, it will be proposed, as a rule, that the shareholders shall have pre-emptive rights in connection with the subscription and allotment, even though the general meeting has granted the Board certain powers of attorney to deviate from this in accordance with the adopted framework. The Board has a general pow-er of attorney to increase the share capital by up to 8,600,000 shares, and 2,750,000 shares have been issued in 2006 under this. This power of attorney can also be used to issue up to 1,500,000 shares in connec-tion with the share option plan for key personnel. The Board can decide whether the shareholders’ pre-emptive rights shall be waived.

directors’ remunerationDetailed information regarding the remuneration of Directors and key employees is disclosed in Note 14 to the financial statements. The nominating committee proposes the remuneration of the Directors for the coming year to the general meeting. The remuneration of Directors is not performance related. Directors are not granted share options.

employee remunerationThe remuneration of the Managing Director and other members of the group management is described in Note 14 to the financial statements. Data Respons operated bonus schemes for the other employees in 2006. The schemes vary from country to country, but the common de-

nominator is that they are dependent on positive earnings and revenue growth. They are limited in general to a maximum of 1-2 months’ sal-ary. On 27 April 2006 Data Respons established a share option scheme for key employees. This scheme is described in Note 14.

auditingThe auditor attends the meeting of the Board at which the annual financial statements are scrutinised. The auditor also has routines for reviewing the company’s internal controls with the Board of Directors. Specified remuneration for the auditor is described in note 14.

safety, health, and environment (she)Data Respons ASA’s operations are not regulated by environmental licences or injunctions. The company does not pollute the external environment. Average sick leave over the course of the year was 2.0%, and none of the group’s subsidiaries recorded occupational accidents that resulted in personal injury or property damage. The working en-vironment is regarded as good, and improvement measures are imple-mented continuously. Employees and management have cooperated constructively, which has had a positive impact on our operations.

allocation of the profit for the yearData Respons ASA (the parent company) reported a profit before tax of NOK 1�.2 million (7.9 million) in 2006. The net profit for the year was NOK �4.5 million (4.6 million). The Board of Directors proposes that the profit for the year of NOK �4.5 million be transferred to other reserves and that no dividends be distributed for 2006. As of �1 De-cember 2006 the parent company had equity of NOK 267.1 million, NOK �5.6 million of which comprised distributable reserves.

future prospectsThe economic climate in the Nordic and German markets is good. The company expects the positive trend in the end-user market to continue in 2007.

The market for embedded solutions is growing. Demand is being driven by the need for new, cost-effective IT solutions by OEM companies, system integrators and vertical product suppliers. The scope of the out-sourcing trend is increasing. This means that more companies are opting to buy total IT solutions, rather than developing everything in-house. This trend is being amplified by smaller market windows in combination with products with increasing technology content. Data Respons is well-positioned to take advantage of these developments. Data Respons will continue to invest in its sales and marketing organisation to reinforce its market position. Organic growth remains the main focus of Data Re-spons. In addition, the group continues to assess potential acquisitions in the Nordic region and Germany.

Based on an improved market situation, solid incoming orders and an increasing supply of solution customers, the company anticipates its profitable growth to continue.

Board of directors Data Respons ASAHøvik, 20 March 2007

Svein R. Golichairman of the board

Mikkel Helwegemployee representative

Lars-Olof Gustavssonmember of the board

Kenneth RagnvaldsenCEO

Tormod Stene-Johansenmember of the board

Øyvind Lien employee representative

Anne-Cecilie Fagerlie member of the board

Ingvild Myhre member of the board

ANNUAL REPORT | DIRECTORS’ REPORT

Consolidated Financial statements and Notes

45

Amounts in NOK 1 000 Note 2006 2005 2004 2006 2005 2004

Sales revenue 1 �9� 04� 267 156 240 406 1 �47 904 2 994

Operatingrevenue 393043 267156 240406 1347 904 2994

Cost of goods sold 210 952 141 819 124 617 54 206 158

Payroll expenses 9, 4 12� 9�8 86 �01 79 852 15 4�6 8 �75 6 692

Depreciation and amortisation 2 2 794 1 827 1 941 �88 245 175

Other operating expenses 2, 17 �5 896 25 817 21 824 -7 080 -4 6�6 459

Operatingprofit/loss 19463 11392 12172 -7451 -3286 -4490

Group contribution from subsidiaries - - - 18 826 10 7�4 -

Other financial income 15 2 �84 2 �95 1 951 1 947 507 641

Other financial expenses 15 -1 488 -2 �78 -2 �02 -162 -57 -88

Profit/lossbeforetax 20359 11409 11821 13160 7898 -3937

Income tax expense 10 18 048 - � �05 -� 727 21 287 -� 287 1 042

Profit/lossfortheyear 38407 8104 8094 34447 4611 -2895

Attributableto

Equity holders of the parent �8 215 8 261 7 501

Minority interest 192 -157 59�

Allocations

From/to other equity �4 447 4 611 -2 895

Earningspershare,Basic(NOK) 8 1,07 0,26 0,26

Earningspershare,Diluted(NOK) 8 1,03 0,26 0,26

Consolidated Income statement

group data respons asa

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | INCOME STATEMENT

46

Consolidated Balance sheet

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | BALANCE SHEET

ASSETS AS OF 31 DECEMBER


Non-currentassets

Intangible assets 2, 4 127 702 49 291 18 000 - - -

Machinery and equipment 2 7 851 4 19� 2 860 1 �68 514 514

Shares in subsidiaries � - - - 262 088 126 949 84 457

Investments in other shares and joint ventures �4 - 94 - - -

Pension funds 9 - - - - 5�1 605

Deferred tax assets 10 40 077 22 114 22 �96 4� 401 22 114 25 402

Totalnon-currentassets 175664 75598 43350 306857 150108 110978

Currentassets

Inventories 5, 12 43686 24234 14471 - - -

Receivables

Trade receivables 6, 7, 12 101 969 81 665 69 445 1 90� 18 150 4 5�1

Other receivables 6, 7 15 719 7 771 4 �10 15 191 11 8�5 48�

Totalreceivables 117688 89436 73755 17094 29985 5014

Cashandcashequivalents 16 29411 48266 45158 10069 23843 32165

Totalcurrentassets 190785 161936 133384 27163 53828 37179

Totalassests 366449 237534 176734 334020 203936 148157


47

Consolidated Balance sheet

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | BALANCE SHEET

group data respons asaEQUITY AND LIABILITIES AS OF 31. DECEMBER


equity

Sharecapital

Issued capital 8 18 440 16 7�5 14 8�� 18 440 16 7�5 14 8��

Treasury shares 8 -�2 -�2 -�2 -�2 -�2 -�2

Share premium 21� 007 171 2�9 1�0 �21 21� 007 171 2�9 1�0 �21

TotalSharecapital 231415 187942 145122 231415 187942 145122

Retainedearnings

Other equity 4 307 -35 515 -42 931 �5 64� 426 -4 184

Totalretainedearnings 4307 -35515 -42931 35643 426 -4184

Minority interests - -�2� 2 098 - - -

Totalequity 235722 152104 104289 267058 188368 140938

liabilities

Non-currentliabilities

Pension liabilities 9 6 568 4 096 4 028 208 - -

Other non-current liabilities 12 �5 667 12 091 - �5 805 12 000 -

Totalnon-currentliabilities 42235 16187 4028 36013 12000 -

Currentliabilities

Interest-bearing loans and borrowings 12 - 2 706 2 601 - - -

Trade payables �7 586 �5 111 22 48� 5�� 1 269 1 079

Income tax payable 10 2 199 142 1 76� - - -

Public duties payable 17 694 1� 421 15 291 2 011 2�7 1 149

Other current liabilities 11 �1 01� 17 86� 26 279 28 405 2 062 4 991

Totalcurrentliabilities 88492 69243 68417 30949 3568 7219

Totalliabilities 130727 85430 72445 66962 15568 7219

Totalequityandliabilities 366449 237534 176734 334020 203936 148157

Svein R. Golichairman of the board

Mikkel Helwegemployee representative

Lars-Olof Gustavssonmember of the board

Kenneth RagnvaldsenCEO

Tormod Stene-Johansenmember of the board

Øyvind Lien employee representative

Anne-Cecilie Fagerlie member of the board

Ingvild Myhre member of the board

Høvik, 20 March 2007

48

Total

Amounts in NOK 1 000 NoteShare

capitalPremium

reserveTreasury

sharesOther equity Total

Equityasof1January2004 13389 105341 -32 - 118698 118698

Effect of implementation of IFRS - - - -1 289 -1 289 - 1 289

Adjustedequityasof1January2004 13389 105341 -32 -1289 117409 117409

Profit/loss for the year - - - -2 895 -2 895 -2 895

Issue of share capital* 1 444 24 980 - - 26 424 26 424

Equityasof31December2004 14833 130321 -32 -4184 140938 140938

Profit/loss for the year - - - 4 611 4 611 4 611

Issue of share capital** 1 902 40 918 - - 42 820 42 820

Equityasof31December2005 16735 171239 -32 426 188368 188368

Employee share option scheme 14 - - - 771 771 771

Profit/loss for the year - - - 34 447 34 447 �4 447

Issue of share capital*** 8 1 705 41 768 - - 4� 47� 4� 47�

Equityasof31December2006 18440 213007 -32 35643 267058 267058

Majority Minority Total

Amounts in NOK 1 000Share

capitalPremium

reserveTreasury

sharesCurr.

transl. diff.Other equity Total

Equityasof1January2004 13389 105341 -32 - -44690 74008 1505 75513

Effect of implementation of IFRS - - - - -5 4�4 -5 4�4 - - 5 4�4

Adjustedequityasof1January2004 13389 105341 -32 - -50124 68574 1505 70079

Currency translation differences - - - -�08 - -�08 - -�08

Profit/loss for the year - - - - 7 501 7 501 59� 8 094

Issue of share capital* 1 444 24 980 - - - 26 424 - 26 424

Equityasof31December2004 14833 130321 -32 -308 -42623 102191 2098 104289

Net reduction in minority interests - - - - - - -2 264 -2 264

Currency translation differences - - - -845 - -845 - -845

Profit/loss for the year - - - - 8 261 8 261 -157 8 104

Issue of share capital** 1 902 40 918 - - - 42 820 - 42 820

Equityasof31December2005 16735 171239 -32 -1153 -34362 152427 -323 152104

Net reduction in minority interests - - - - - - 131 131

Currency translation differences - - - 836 - 836 - 836

Employee share option scheme 14 - - - - 771 771 - 771

Profit/loss for the year 8 - - - - 38 215 38 215 192 38407

Issue of share capital*** 1 705 41 768 - - - 43 473 - 43473

Equityasof31December2006 18440 213007 -32 -317 4624 235722 - 235722

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | EQUITY STATEMENT

Consolidated Equity statement

group

data respons asa

*) Transaction expenses of NOK 1 500 million have been deducted **) Transaction expenses of NOK 1 600 million been deducted ***) Transaction expenses of NOK 1 846 million have been deducted

49


Cashflowfromoperatingactivities

Operating profit/loss 19 46� 11 �92 12 172 -7 451 -� 286 - 4 490

Income tax paid -715 -1 9�6 -1 49� - - -

Depreciation and amortisation 2 794 1 827 1 941 �88 245 175

Employee share option scheme 771 - - 771 - -

Change in inventories 4 -17 866 -9 76� -7 761 - - -

Change in trade receivables 4 -8 246 -12 220 -�0 �79 16 247 -24 �52 -9 078

Change in trade payables 4 -5 915 12 628 10 916 -7�6 190 -864

Change in provisions for pensions 9 2 472 68 -1 11� 7�9 74 -�62

Change in other accruals 4 4 794 -14 241 12 506 24 5�0 -4 456 12 827

Netcashflowfromoperatingactivities* -2448 -12245 -3211 34488 -31585 -1792

Cashflowfrominvestingactivities

Acquisition of subsidiaries, net of cash acquired** -46 825 - 14 96� - - - -

Purchase of machinery and equipment 2 -4 646 - � 160 -2 181 -1 241 -245 -61�

Proceeds from sale of machinery and equipment 82 - - - - -

Interest received 15 1 6�6 869 574 1 947 445 486

Interest paid*** 15 -116 -26� -�72 -162 - -�9

Purchase of intangible assets 2 -574 -1 600 - - - -

Purchase of financial assets � -�4 - - -10� 461 -21 784 -2 5�8

Proceeds from sale of financial assets - 162 - - - -

Netcashflowfrominvestingactivities -50447 -18956 -1979 -102917 -21584 -2704

Cashflowfromfinancingactivities

Cash and cash equivalents at the start of the period - 91 - - - -

Net change in overdraft facilities -2 706 105 1 480 - - -

Group contributions - - - 18 826 10 7�4 -

Proceeds from issuance of shares** 8 �5 829 �4 11� 26 424 �5 829 �4 11� 26 424

Netcashflowfromfinancingactivities 33123 34309 27904 54655 44847 26424

Netchangeincashandcashequivalents -19802 3108 22714 -13774 -8322 21928

Cash and cash equivalents at the start of the period 48 266 45 158 22 444 2� 84� �2 165 10 2�7

Exchange gains/losses on cash and cash equivalents 947 - - - - -

Cashandcashequivalentsattheendoftheperiod 29411 48266 45158 10069 23843 32165

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | CASH FLOW

Consolidated Cash flow statement


* The company acquired subsidiaries during the year. The opening balance sheet for these acquisitions must be taken into account for the calculation of changes in current asset and liability items, so the reported figures will not be in agreement with changes in the consolidated balance sheet figures. Reference is made to Note 4 for additional information on the effects of business combina-tions.

** In the financial statements for prior years, the “gross” amount was reported for share capital increases related to the acquisition of subsidiaries, i.e. the amount included both payment in equity as well as cash payments. In accordance with IAS 7, the company has decided to change this practice and not report capital increases associated with the acquisition of subsidiaries as a cash flow. The figures for 2005 have been adjusted by NOK 8,707,000 for comparison purposes. This is only an adjustment of the classification between investing and financing activities, and it does not affect the total cash flow.

*** Interest paid will vary in accordance with how the company finances its expansion (increasing capital versus borrowing) and invests its funds. It will to a lesser extent reflect the operational acti-vities. Therefore the company has chosen to classify interest paid under investing activities and reclassified prior reported periods correspondingly.

50

general informationData Respons ASA is a public limited company registered in Norway. The company’s head office is located at Sandviksveien 26, 1323 Høvik, Norway. The group’s business operations are described in Note 1.

accounting principlesThe Data Respons Group’s consolidated financial statements and the company financial statements of Data Respons ASA for the financial year of 2006 have been prepared in accordance with International Financial Reporting Standards (IFRS) and the interpretations set out by the International Accounting Standards Board, with effect from 1 January 2005, and with comparative figures for 2004. IAS 32 and 39 have been implemented with effect from 1 January 2005 without a corresponding restatement of the comparative figures. Reference is made to the 2005 annual financial statements for additional informa-tion on the implementation of IFRS and the effects of the transition to IFRS. The financial statements are based on historical cost prin-ciples with the exception of financial derivatives. The consolidated financial statements have been prepared using consistent accounting principles for similar transactions and events under otherwise similar circumstances.

The standards, amendments and interpretations listed below have been published, but are not yet effective. Data Respons ASA has de-cided not to apply these for the preparation of the annual financial statements for this year. The new standards will affect the disclosure requirements for financial instruments from 2007 and segment report-ing from 2009.

new standardsIFRS 7 Financial Instruments: DisclosuresIFRS 8 Operating Segments

amendments to standardsIFRS 4 Revised Guidance on Implementing IFRS 4 Insurance ContractsIAS 1 Amendments to IAS 1 Presentation of Financial Statements Capital Disclosures

new statementsIFRIC 7 Applying the Restatement Approach under IAS 29 Finan-cial Reporting in Hyperinflationary EconomiesIFRIC 8 Scope of IFRS 2IFRIC 9 Reassessment of Embedded DerivativesIFRIC 10 Interim Financial Reporting and ImpairmentIFRIC 11 IFRS 2 - Group and Treasury Share TransactionIFRIC 12 Service Concession Arrangements

consolidationThe consolidated financial statements include Data Respons ASA and companies in which Data Respons ASA has a controlling interest. A controlling interest is normally achieved when the group owns more than 50% of the shares in the company or the group is in a position to exercise actual control over the company. Minority interests are included in the group’s equity.

The consolidated financial statements include the parent company Data Respons ASA and the following subsidiaries:

Data Respons Norge AS (100 %)Data Respons AB (100 %)Data Respons (Denmark) A/S (100 %)Data Respons OY (100 %)Certified Computer Technology AS (CCT) (100 %)Centrex AS (100 %)Data Respons Components AB (100 %)Memstore Aps (Denmark) (100 %)Memstore AS (100 %)Embedit A/S (Denmark) (100 %)Data Respons GmbH (Germany) (100 %)

The consolidated financial statements show the overall financial results and the overall financial position by presenting the parent company Data Respons ASA and its controlling interests in other companies as a single financial entity. Companies in which the group has a sole controlling interest (subsidiaries) have been fully consolidated line by line in the consolidated financial statements.

The profit/loss for the year and share of equity attributed to minority interests are presented on separate lines. Intercompany transactions and balances have been eliminated. The consolidated financial state-ments have been prepared using uniform principles, which means that the subsidiaries follow the same accounting principles as the parent company, and that these principles have been applied consistently over time.

Acquired subsidiaries are recognised in the consolidated financial statements based on the historical cost to the parent company. The historical cost is allocated to identifiable assets and liabilities in the subsidiary, which are recorded in the consolidated financial state-ments at fair value at the time of acquisition. Identifiable assets are defined as both tangible and intangible assets, excluding goodwill. Any excess value or shortfall in value beyond that which can be attrib-uted to identifiable assets and liabilities is recognised in the balance sheet as goodwill.

Goodwill is treated as a residual value, and it is recognised in the bal-ance sheet in the amount observed in the acquisition transaction. Ex-cess values in the consolidated financial statements are depreciated on a straight-line basis over the anticipated economic life of the acquired assets. Goodwill and excess values attributed to intangible assets with an indeterminable useful life are not depreciated, but are tested for impairment in accordance with IFRS.

classification and valuation of balance sheet itemsCurrent assets and current liabilities comprise of items that fall due within one year of the balance sheet date, as well as items related to the operating cycle. Other items are classified as non-current assets or non-current liabilities.

Financial instruments are classified and measured in accordance with IAS �9 Financial Instruments; Recognition and Measurement. For Data Respons ASA the only relevant categories are loans and receivables. Financial assets with fixed or determinable cash flows that are not listed in an active market are classified as receivables.

receivablesAccounts receivable and other receivables are recognised in the bal-ance sheet at nominal value, less provisions for estimated losses. Pro-visions for losses are made on the basis of individual assessment of the individual receivables, as well as past experience.

machinery and equipmentMachinery and equipment is recognised in the balance sheet and de-preciated on a straight-line basis over the estimated useful life less any residual value. Direct maintenance of machinery and equipment is expensed as other operating expenses, while enhancements or im-provements that increase the capacity are added to the cost price and depreciated in line with the asset. Depreciation periods and profiles and residual values are assessed annually.

intangible assetsIntangible assets consist of identifiable intangible assets. Intangible assets are recognised in the balance sheet if it is probable that the expected future financial benefits attributable to the asset will pass to the company and the asset’s historical cost can be measured separate-ly and in a reliable manner. Intangible assets with a limited economic life are recognised at historical cost, less accumulated depreciation and impairment. Depreciation is charged on a straight-line basis over the estimated useful life. The depreciation period and method are

Accounting principles

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | ACCOUNTING PRINCIPLES

51REGNSKAP | REGNSKAPSPRINSIPPER

reviewed annually. Intangible assets with an indeterminable economic life are not depreciated, but are tested annually for impairment at the balance sheet date.

goodwillThe difference between the historical cost at the time of ac-quisition and the fair value of net identifiable assets at the time of acquisition are classified as goodwill. Goodwill is rec-ognised in the balance sheet at historical cost, less any ac-cumulated impairments. Goodwill is not depreciated, but is tested annually for impairment at the balance sheet date, or more frequently if there is an indication of impairment.

In cases where negative goodwill is identified in connection with business combinations, the excess value analysis is reas-sessed before any negative goodwill is recognised in income.

research and developmentExpenses related to research activities are recognised in the income statement when they are incurred. Expenses relating to development activities are recognised in the balance sheet if these relate to an identifiable product that is technically and commercially feasible and the group has adequate resources to complete the development.

Expenses that are recognised in the balance sheet include material expenses, direct payroll expenses and a percentage of directly attributable overhead expenses. Capitalised de-velopment expenses are recognised in the balance sheet at historical cost, less any accumulated depreciation and write-downs. Capitalised development expenses are depreciated over the estimated useful life of the asset. Intangible assets under development, however, are not depreciated and are tested annually for impairment, or more frequently if there is an indication of impairment.

valuation of investments in subsidiariesSubsidiaries are valued in accordance with the historical cost method in the parent company’s financial statements. Invest-ments are valued at the historical cost of the shares unless a write-down of the shares has been necessary. They are written down to fair value in the event of an impairment that is not expected to be temporary.

provisionsProvisions are made in the financial statements where the group has a liability (legal or self-imposed) as a result of a past incident, if it is probable that a financial settlement will be made as a result of this liability, and if the amount of such a settlement can be measured reliably. If the impact is signifi-cant, the provisions are calculated by discounting the estimat-ed future cash flows by a discount rate before tax that reflects the market’s pricing of the current value of money and, where relevant, risks specifically linked to the liability.

Provisions for restructuring are included if the group has ap-proved a detailed and formal restructuring plan, and the re-structuring has either started or been announced. Provisions for loss-making contracts are included when the group’s estimated revenue from a contract is lower than the estimated expenses that will be incurred to fulfil the contractual obligations.

revenue recognitionIncome is recognised when it is probable that transactions will generate future financial benefits that will pass to the com-pany, and the value of such benefits can be estimated reliably. Sales revenue is recognised net of value added tax and dis-counts. The group has revenue from three different areas:

products

The Data Respons Group’s consolidated financial statements and the company financial statements for Data Respons ASA for the financial year of 2006 have been prepared in accordance with International Financial Reporting Standards (IFRS) and the interpretations set out by the Interna-tional Accounting Standards Board.

52 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | ACCOUNTING PRINCIPLES

Revenue from the sale of goods is recognised when delivery has been made and most of the risk and return potential has been transferred.

servicesRevenue from the sale of services is recognised according to the stage of completion. The stage of completion is measured as accrued hours in relation to total estimated hours. Estimated loss on contracts will be recognised in the income statement in its entirety in the period when it has been identified.

solutionsRevenue from the sale of solutions is a combination of the sale of development services and the subsequent delivery of products. The recognition of revenue from solutions is dependent on the pricing model selected. In cases where the customer pays separately for de-velopment work and the products, and pricing is established inde-pendently, revenue is recognised in accordance with the principles applicable to the services and products described above.

If the customer only pays for the finished product, the company, in cases where there is a contractual delivery, recognises revenue and capitalises development work in line with the degree of completion. This is subsequently expensed in line with the delivery of the prod-ucts. Interest income is recognised as it is accrued. Dividends are rec-ognised as income when they have been approved by the general meeting of the distributing company.

inventoriesPurchased inventory is valued at the lower of historical cost (using the FIFO principle) or net realisable value. Write-downs are made for any inventory that is assumed to be obsolete.

foreign currencytransactions in foreign currencyTransactions in foreign currencies are translated at the rate in effect on the date of the transaction. Monetary items in foreign currencies are translated to Norwegian kroner (NOK) using the rate in effect at the balance sheet date. Exchange rate fluctuations are recognised in the income statement on an ongoing basis during the accounting period.

foreign operationsThe assets and liabilities of foreign operations, including goodwill, are translated into norwegian kroner (NOK) using the exchange rate in effect at the balance sheet date. Revenue and expenses relating to foreign businesses are translated into norwegian kroner (NOK) using an average exchange rate for the period. Translation differences result-ing from the translation of net investments in foreign businesses are specified as translation differences in equity. Translation differences previously recognised in equity are subsequently recognised in the income statement in the event of a complete or partial disposal of the subsidiary.

government grantsGovernment grants are recognised in the financial statements where it is reasonably certain that the company will fulfil the terms of the grants, and that the grants will be received. Operating subsidies are accounted for systematically over the period that the subsidies are re-ceived. Grants are recorded in the financial statements as a deduction in the expenses they are meant to cover.

pensionsPension expenses and pension liabilities are calculated on a linear earning basis in accordance with assumptions regarding the discount rate; future adjustment of wages, pensions and social security ben-efits; future return on pension funds; as well as actuarial assumptions regarding mortality, voluntary retirement, etc.

The pension funds are valued at fair value less the net pension liabili-ties in the balance sheet. Changes in pension liabilities due to changes in pension plans are allocated over the estimated remaining earn-

ing period. The same applies to actuarial gains or losses (estimated discrepancies) exceeding 10% of the higher of the pension liabilities or pension funds (corridor). Employer’s social security contributions are charged as an expense based on the pension premium paid for insured (group) pension schemes, and are accrued in accordance with the change in the pension liabilities for uninsured pensions.

employee share option schemeEmployee share options are calculated at the fair value at the time they are granted and accrued on a linear basis over the vesting period until the exercise date. The employer’s social security contributions linked to vest-ed options are accrued correspondingly over the life-span of the option.

income taxIncome tax expense in the income statement comprises of both in-come tax payable for the period and changes in deferred tax. Deferred tax is calculated at the rate of 28% on the basis of temporary differ-ences between the financial accounting and tax-related values, and tax loss carryforward at the end of the financial year. Negative and positive temporary differences that reverse or may reverse during the same period are offset and the tax effect of the net amount is calculated. The tax loss carryforward is recognised in the balance sheet as a deferred tax asset if it is considered adequately probable that the losses can be utilised in the future; see Note 10.

cash and cash flow statementThe cash flow statement has been prepared in accordance with the indirect method. Cash and cash equivalents include cash, bank de-posits and other short-term liquid investments that can be converted immediately and without any significant exchange rate risk to a known cash amount, and with maturity date less than three months from the purchase date.

segmentsThe group is organised into geographic areas with independent sub-sidiaries. The geographic areas form the basis for the primary segment reporting. For management purposes financial monitoring is per-formed by country (and subsidiary). Financial information relating to geographic areas and the distribution of revenue by business area is presented in Note 1.contingent liabilities and assetsContingent liabilities are not recognised unless these arise from, and are assessed as a result of business combinations. Material contingent liabilities are disclosed (see Note 12) unless the probability of the li-ability materialising is low. Contingent assets are not recognised in the annual financial statements.

events after the balance sheet dateNew information received after the balance sheet date relating to the company’s financial position at the balance sheet date has been taken into consideration in preparing the annual financial statements. Events occurring after the balance sheet date that do not affect the company’s financial position at the balance sheet date, but that will affect the company’s financial position in the future are disclosed in Note 20 if these are material.

use of estimatesThe management has used estimates and assumptions that have af-fected assets, liabilities, income, expenses and information on poten-tial liabilities. This applies in particular to the recognition of revenue related to long-term manufacturing projects, development projects, capitalised development expenses, pension liabilities and the valua-tion of goodwill. The estimates may change as a result of future events. Estimates and their underlying assumptions are assessed continuously. Changes to accounting estimates are included in the financial state-ments for the period in which the change occurs. If the changes also apply to future periods, the impact is spread over the current and future periods.

5�REGNSKAP | NOTER

Notes

54 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 1

Data Respons’ risk and return profile is largely based on the localisation of its customers, who are in different markets. The group’s operations are there-fore based on the geographic identification of the companies, which also corresponds with management reporting. The company has defined product/ business areas as secondary segment.

Transactions and transfers between the group’s segments are carried out on ordinary commercial terms, corresponding to the terms used for external parties.

pRIMARY SEgMENT

2006 Norway Sweden Denmark Finland Germany Unallocated/eliminations*

Group

External operating revenue 221 9�7 71 290 80 700 7 812 11 �04 - �9� 04�

Internal operating revenue 6 185 1 509 479 - 40 -8 21� -

Segmentrevenue 228122 72799 81179 7812 11344 -8213 393043

Operating expenses 199 772 71 046 78 891 8 640 14 054 -1 617 �70 786

Depreciation 1 457 �27 4�� 16 71 490 2 794

Segmentprofit/loss 26893 1426 1855 -844 -2781 -7086 19463

Net financial items 896

Profit/lossbeforetax 20359

Income tax expense -18 048

Profit/lossfortheyear 38407

Capital expenditures this period 1 212 1 442 474 - 195 1 �14 4 6�7

Totalassets 114635 32672 50336 1994 1646 165166 366449

Totalliabilities 30870 24015 33530 1973 6131 34208 130727


Group

External operating revenue 164 127 47 819 47 470 4 496 � 244 - 267 156

Internal operating revenue 1 216 81 755 27� - -2 �25 -

Segmentrevenue 165343 47900 48225 4769 3244 -2325 267156

Operating expenses 146 160 46 590 47 576 6 054 5 062 2 495 25� 9�7

Depreciation 1 278 154 �00 20 75 - 1 827

Segmentprofit/loss 17905 1156 349 -1305 -1893 -4820 11392

Net financial items 17


Income tax expense � �05


Capital expenditures this period 1 �5� 22� 61 1 175 61� 2 426

Totalassets 106079 22654 23694 2123 3066 79918 237534

Totalliabilities 73828 19002 9825 1825 4562 -23622 85430

note 1 segments

* The item “unallocated/eliminations” includes non allocated group expenses (ASA) and eliminations of intercompany revenue and expenses. In addition, the item includes non allocated assets and liabilities related to the group (ASA), deferred tax/tax assets, goodwill, as well as eliminations of intercompany balances.

55CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 1

pRIMARY SEgMENT


Group

External operating revenue 11� 19� �5 8�9 85 �� 6 041 - - 240 406

Internal operating revenue 421 �6 �5 20 - -512 -

Segmentrevenue 113614 35875 85368 6061 - -512 240406

Operating expenses 101 169 �5 �70 78 4�9 7 508 - � 807 226 29�

Depreciation 1 421 110 �89 21 - - 1 941

Segmentprofit/loss 11024 395 6540 -1468 - -4319 12172

Net financial items -�51


Income tax expense � 727


Capital expenditures this period 987 2�0 �58 - - - 1 576

Totalassets 59243 8937 44732 1400 - 62422 176734

Totalliabilities 38340 6015 30486 1555 - -3951 72445

SECONDARY SEgMENT

2006 2005 2004 2006 2005 2004 2006 2005 2004

Segment revenue 241 100 176 100 148 500 8� 000 65 700 67 �00 68 900 25 400 24 600

Capital expenditures this period 2 01� 1 205 984 702 474 444 684 1�5 147

Total assets 117 04 112 �76 77 208 �0 801 �1 480 28 090 5� 4�2 1� 760 9 014

solutions products services

* The item “unallocated/eliminations” includes non allocated group expenses (ASA) and eliminations of intercompany revenue and expenses. In addition, the item includes non allocated assets and liabilities related to the group (ASA), deferred tax/tax assets, goodwill, as well as eliminations of intercompany balances.


note 2 intangible assets, machinery and equipment

MachineryandEquipment Goodwill

Otherintangible

assets

Totalintangible

assets

Machineryand

Equipment

Cost or valuation as of 1 January 2005 2 247 18 000 - 18 000 14 215

Additions 245 29 691 1 600 �1 291 2 451

Disposals - - - - -

Additions from acquired companies - - - - 2 424

Costorvaluationasof31December2005 2492 47691 1600 49291 19091

Accumulated depreciation and impairment as of 01.01.05 1 7�� - - - 11 �55

Depreciation for the year 245 - - - 1 827

Impairment for the year - - - - -

Additions from acquired companies - - - - 1 715

Accumulateddepreciationandimpairmentasof31.12.05 1978 - - - 14897

Netbookvalueasof31December2005 514 47691 1600 49291 4193

Cost or valuation as of 1 January 2006 2 492 47 691 1 600 49 291 19 091

Additions 1 241 76 892 1 592 78 484 4 646

Disposals - -799 -799 -82

Translation differences - 48� 48� 107

Additions from acquired companies - - 1 �18 1 �18 4 295

Costorvaluationasof31December2006 3733 125066 3711 128777 28057

Accumulated depreciation and impairment as of 01.01.06 1 978 - - - 14 897

Depreciation for the year �87 - 128 128 2 664

Impairment for the year - - - - -

Additions from acquired companies 947 947 2 645

Accumulateddepreciationandimpairmentasof31.12.06 2365 - 1075 1075 20206

Netbookvalueasof31December2006 1368 125066 2636 127702 7851

Both the parent company and group use straight-line depreciation for all machinery and equipment.The estimated economic life of machinery and equipment is � to 5 years. Intangible assets are depreciated over the life of the asset, which is estimated to be from 2.5 to 10 years.

Expensedleaserentalsinthegroup 2006 2005

Rental of premises in Norway 5 �71 4 422

Rental of premises outside Norway 1 968 1 454

The company does not have any purchase options on the properties. In Norway the lease for the head office at Høvik expires on 1 March 2011, while the terms of lease for the foreign units vary from a lease requiring 12 months’ notice (Denmark) to a lease with an expiry date of 31 December 2011 (Sweden). The leases will continue on unchanged terms.

intangible assetsOther intangible assets consist of capitalised development expenses, as well as intangible assets recognised at fair value upon the acquisition of companies. In 2006, development project expenses totalling NOK 574,000 were capitalised, while NOK 2,524,000 was charged as expenses.

Amounts in NOK 1 000

groupdata respons asa


Changesingoodwillarosein2006duetothefollowingacquisitions:

Company Date Goodwill Shareholding

Data Respons Oy (Finland) 01.02.2006 �41 12.0 %

Memstore AB (Sweden) 01.04.2006 24 022 100.0 %

Embedit A/S (Denmark) 08.10.2006 51 229 100.0 %

As a result of changes in estimates for earn-out payments in connection with the acquisition of Centrex AS in 2005, goodwill relating to this acqui-sition has been adjusted upwards by NOK 1 �00 million.

impairment test for goodwillGoodwill that has arisen through the acquisition of companies and units is allocated to the individual unit if the cash flows are still identifiable. In cases where units have been merged the combined goodwill will be assessed for the merged unit.

Goodwillisallocatedtotheprimarysegmentsasfollows: 2006 2005

Norway 42 720 41 420

Sweden 25 68� -

Denmark 56 �22 6 271

Finland �41 -

Germany - -

Total 125066 47691

The recoverable amount for the cash flow-generating units is calculated based on the value the asset will generate for the business operations. Li-quidity forecasts based on the budget approved by the management for a five-year period are used. Cash flows beyond this period are derived using estimated growth rates for the individual units.

The impairment test for 2006 showed that there was no need to write down the capitalised goodwill.

The most import assumptions for calculation of the recoverable amount are as follows: sales growth:Management expects that the market for the company’s products and services will increase in the coming years, and that the company will be able to gain market shares in the segments where it operates. A growth rate that is lower than that achieved in recent years has been assumed.

ebit margin:It is assumed that units with a higher EBIT margin than the group average will maintain this, while units with margins below the average will increase their margins as a result of greater efficiency and higher sales. discount rate:A discount rate of 12% has been used for all units.

extrapolated growth rate:The growth rate beyond five years has been set at 0% for all units.

The company believes that the estimates for future cash flows are conservative, and even if goodwill in Denmark and Sweden is dependent onmaintaining the margins, the company believes it is not very probable that the assumptions will change to such an extent that these could affect the outcome of the impairment test.

58 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE �

note 3 subsidiaries and other equity investments

Company Dateofacquisition Registeredoffice Ownershipandvotingshare

Data Respons Norge AS 27.11.01 Bærum 100,0 %Certified Computer Technology AS 17.02.00 Bærum 100,0 %Data Respons AB (SE) 27.11.01 Upplands Väsby (SE) 100,0 %Data Respons A/S (DK) 27.11.01 Herlev (DK) 100,0 %Data Respons OY (FI) 01.11.0� Espoo (FI) 100,0 %Data Respons GmbH (DE) 17.02.05 Karlsruhe (DE) 100,0 %Centrex AS 01.12.05 Bærum 100,0 %Data Respons Components AB (SE) (formerly Memstore AB) 01.04.06 Upplands Väsby (SE) 100,0 %Memstore Aps (DK) 01.04.06 Herlev (DK) 100,0 %Embedit A/S (DK) 08.10.06 Herlev (DK) 100,0 %

Company Sharecapital Shareholding BookvalueData Respons Norge AS NOK 1 �87 100,0 % 125 210Certified Computer Technology AS NOK 1 100 100,0 % -Data Respons AB (SE) SEK 507 100,0 % 1� 144Data Respons OY (FI) EUR 150 100,0 % � 494Data Respons A/S (DK) DKK 1 2�0 100,0 % 11 990Data Respons GmbH (DE) EUR 50 100,0 % 42�Centrex AS NOK 125 100,0 % 24 488Data Respons Components AB (SE) SEK 400 100,0 % 25 024Memstore AS NOK 100 100,0 % -Embedit A/S (DK) DKK 500 100,0 % 58 �15Total 262088

group

data respons asa

The investments are accounted for in accordance with the cost method in the parent company’s financial statements.

Wireless Rio AS and Certified Computer Technology AS merged with Data Respons Norge AS with effect from 1 January 2006, and Data Respons Norge AS was the acquiring company. The company ecInnovation AS changed its name to Certified Computer Technology AS in December 2006.

Data Respons Norge AS’s shareholdings of 52.33 % in Data Respons AB and 82.9 % in Data Respons A/S (Denmark), respectively, were acquired by Data Respons ASA in 2006.


note 4 business integrationBUSINESS ACQUISITIONS IN 2006

12 % of the shares in Data Respons Oy (Finland) were acquired on 1 February 2006.All of the shares in the company Memstore AB (Sweden) were acquired on 22 March 2006. Memstore AB owned 75 % of the shares in the subsidiary Memstore Aps, and the minority interest of 25 % was acquired in July 2006. Memstore AB subsequently changed its name to Data Respons Components AB. Memstore AB/Aps has contributed a profit after tax of NOK 2 179 million from the date of the acquisition.All of the shares in the company Embedit A/S (Denmark) were acquired on 8 October 2006. Embedit A/S has contributed a profit after tax of NOK 2 285 million from the date of the acquisition.

The following table shows the fair value of identifiable assets and liabilities and the corresponding book values at the time of acquisition.

DataResponsOy MemstoreAB/Aps MemstoreAps EmbeditA/SBook valueNOK 1 000

Fair valueNOK 1 000

Book valueSEK 1 000

Fair valueSEK 1 000K

Book valueSEK 1 000

Fair valueSEK 1 000

Book value DKK 1 000

Fair valueDKK 1 000

Cash and cash equivalents 615 615 5 926 5 926 1 804 1 804 � �66 � �66

Accounts receivable and other receivables 7�6 7�6 6 790 6 790 � 28� � 28� 7 �42 7 �42

Inventories 11� 11� 1 878 1 878 712 712 - -

Plant and machinery 16 16 60 60 46 46 1 657 1 657

Capitalised development projects - - - - - - ��8 ��8

Contracts - - - - - - - 900

Accounts payable -405 -405 -� 79� -� 79� -2 065 -2 065 -� 872 -� 872

Non interest-bearing liabilities -2 701 -2 701 -7 580 -7 580 -1 691 -1 691 -� 645 -� 645

Minority interests - - -252 -252 - - - -

Netidentifiableassets -1626 -1626 3029 3029 2089 2089 5186 6086

Share (%) acquired 12 % 100 % 25 % 100 %

Netassetsacquired -195 3029 522 6086

Cash payment 146 20 000 2 472 �1 �20

Share issue* - 9 000 -

Contingent liability** - - 19 900

Direct acquisition expenses - 264 165

Purchaseprice 146 29264 2472 51385

Goodwillattimeofacquisition 341 26235 1950 45299

Exchange rate at time of acquisition 1,00 0,85 0,86 1,1�

Goodwill(NOK1000) 341 22347 1675 51229

pRO FORMA FIgURES (UNAUDITED)

Figures in NOK million Operatingrevenue EBITDA

2006 2005 2006 2005Norway 228,1 191,7 28,4 2�,5Sweden 78,9 79,6 -1,8 �,2Denmark 122,0 9�,2 7,2 4,8Finland 7,7 4,8 -0,8 -1,�Germany 11,4 �,� -2,8 -1,9Eliminations / ASA -8,� -2,4 -6,4 -4,7Totalgroup 439,8 370,2 23,8 23,6

* In connection with the acquisition of Memstore AB, parts of the purchase price were paid by the issuance of 660 982 shares based on a market price of SEK 11.60 and an SEK/NOK exchange rate of 0.8521.** For some acquisitions agreements have been entered into whereby the purchase price is linked to the profit performance of the acquired company for a specific period of time after the acquisition. In these cases the assumed liability is estimated and added to the purchase price.

The following table shows the revenue and EBITDA distributed by primary segment if all the acquisitions had been consolidated as of 1 January 2005. The table includes unconsolidated figures from the acquired companies described above, as well as the acquisitions of Centrex AS and Certified Computer Technology AS in 2005.

group

60 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 5-6

note 5 inventoriesgOODS pURChASED FOR RESALE

2006 2005 2004 2006 2005 2004

Historical cost - - - 44 164 26 477 16 ��7

Written down to fair value - - - 44 016 24 511 14 571

General provisions for obsolescence - - - -��0 -227 -

Bookvalue - - - 43686 24234 14571

Value of inventory pledged as security - - - 11 500 22 �99 5 989

2006 2005 2004 2006 2005 2004

Accounts receivable 1 90� - - 102 745 80 01� 65 070

Provisions for accounts receivable - - - -776 -728 -100

Net accounts receivable 1903 - - 101969 79285 64970

Accrued, non-invoiced income - - - 6 �2� 2 �80 4 475

Prepayments 4� 69 71 2 61� 2 281 2 491

Other current receivables 15 �00 29 916 4 94� 6 78� 5 490 1 819

Totalreceivables 17246 29985 5014 117688 89436 73755

Provisions as of 1 January - - - 7�6 108 100

Realised losses - -9 - - -66 -85

Provisions for the period - - - 40 �08 9�

Additions from acquired companies - - - - �86 -

Provisions as of �1 December - - 776 7�6 108

Losses on accounts receivable are classified as other operating expenses in the income statement.Accrued, non-invoiced income was classified under accounts receivable in the balance sheet in 2005 and 2004.

group

note 6 customer and other receivables

data respons asa



note 7 intercompany balancesRECEIvABLES:

Othercurrentreceivables

2006 2005 2004

Data Respons Norge AS* 11 441 2� 041 295

Centrex AS 56 - -

Data Respons A/S (DK) 20 - 2 505

Data Respons AB (SE) 2 557 2 922 450

Data Respons Components AB 18 - -

Data Respons Oy (FI) 169 700 62

Data Respons GmbH (DE) 2 67� 1 656 -

Certified Computer Technology AS** -20 - 780

Total 16914 28319 4092

pAYABLES:Othercurrentliabilities

2006 2005 2004

Data Respons Norge AS* 25 182 7�5 �95

Centrex AS 76 - -

Data Respons AB (SE) 87 199 218

Data Respons A/S (DK) 77 - -

Data Respons OY 4� - -

Total 25465 934 614

* Certified Computer Technology AS and Wireless Rio AS merged with Data Respons Norge AS with effect from 1 January 2006. The comparative figures have been adjusted accordingly.

** The company ecInnovation AS changed its name to Certified Computer Technology AS in December 2006.

data respons asa

data respons asa


note 8 share information

list of 20 largest shareholders as of 31 december 2006 Ordinaryshares Shareholding

MP Pensjon 2 599 000 7,0 %Ferd AS 2 500 000 6,8 %Varner Invest AS 1 500 000 4,1 %Saga Equity Fund 1 �50 000 �,7 %Haakon Sæter 1 252 211 �,4 %Verdipapirfondet Delphi Norge 1 206 000 �,� %JP Morgan Chase Bank 1 150 000 �,1 %ABN Amro Norge + VPF 1 098 000 �,0 %RO Invest AS 1 012 000 2,7 %Fougner Invest AS 1 000 000 2,7 %Doorstep AS 910 000 2,5 %ABN Amro Norge VPF 809 511 2,2 %Ventor AS 796 000 2,2 % Petter Sæter 701 550 1,9 % Bernt AS 700 000 1,9 %Glitnitr Banki HF 700 000 1,9 %Loligo AS 700 000 1,9 %Attol Invest AS 672 581 1,8 %Belgavia holding 650 125 1,8 %Søgne Shipping AS 500 000 1,4 %Total 21806978 59,1%Others 15 07� 268 40,9 %

Totalnumberofshares 36880246 100,0%

issues in 2006Date Type Subscriptionprice Numberofshares Afternewissue

22.0�.06 Private placement – consideration for the acquisition of Memstore AB 11,60 660 982 �4 1�0 246

05.05.06 Private placement 1�,70 2 750 000 �6 880 246

authority to issue shares

Approved Type Yearissued Maximumsharelimit Numberofsharesissuedin2006 Remainingnumberofshares Duration

27.04.06 Capital increase 2006 8 600 000 2 750 000 5 850 000 to 27.04.08

The Board has been granted authority to increase the company’s share capital by a maximum of NOK 4 300 000 through the issuance of a maximum of 8 600 000 new shares, each with a par value of NOK 0.50. This authority covers capital increases paid in cash or by contributions in assets other than money and authorisation to incur special liabilities on behalf of the company and make decisions regarding mergers.

The subscription price and other subscription terms shall be determined by the Board of Directors. Premiums shall be allocated to the share premium reserve. The company’s shareholders have waived their pre-emptive subscription rights in accordance with Section 10-5, cf. section 10-4, of the Norwegian Public limited Companies Act. The object of the authority is to give the Board financial flex-ibility in connection with acquisitions or to strengthen the company’s equity.

The registered share capital of Data Respons ASA consisted of �6,880,246 shares with a par value of NOK 0.50 as of �1 December 2006. Each share carries one vote. A total of 47.4 million shares were traded on the Oslo Stock Exchange in 2006, an increase from 41.6 million shares in 2005. At the end of the year Data Respons ASA had 1051 Norwegian shareholders and �6 foreign shareholders. The foreign shareholders owned 8.1% of the shares.

The company owned 63,000 of its own shares at the end of 2006. None of the company’s own shares were bought or sold in 2006.

6�CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 8

share information

2006 2005 2004

Net profit/loss for the year attributable to the company’s shareholders (NOK 1000) �8 215 8 261 7 501

Weighted average number of outstanding shares (1000) �5 729 �1 278 29 �09

Effect of dilution:

Option programme for employees 1 �20 - -

Weighted average number of outstanding shares, diluted �7 049 �1 278 29 �09

Earnings per share 1,07 0,26 0,26

Diluted earnings per share, diluted 1,0� 0,26 0,26

CALCULATION OF TIME-wEIghTED ShARESDate No.ofshares* No.ofdays Weightedno.ofshares

01.01.06 �� 406 264 81/�65 7 41� 445

22.0�.06 �4 067 246 44/�65 4 106 7�7

05.05.06 �6 817 246 240/�65 24 208 600

35728782

*Number of shares has been adjusted by the 6�,000 own shares held by the company.

No distribution of dividends has been proposed for the 2006 financial year.

EARNINgS pER ShAREThe earnings per share key ratio is calculated by dividing the net profit/loss for the year attributable to the company’s shareholders by the time-weighted average of outstanding ordinary shares throughout the year, less the company’s own shares.

The diluted earnings per share key ratio is based on the same calculation as above, however, it also takes into account potential shares that have been outstanding during the period and will have a diluting effect, i.e. reduce the earnings per share for the ordinary shares. The company has only one category of potential shares that can result in dilution: share options.


note 9 pensions

The parent company is required to operate a company pension scheme pursuant to the Mandatory Occupational Pension Act, and operates a pension scheme that meets this requirement. This scheme covered a total of 12 people in 2006.

The group as a whole has a defined benefit pension scheme that covers 88 people in total. The scheme in Norway entitles members to defined future benefits. These benefits are primarily dependent on the number of years of service, salary level at retirement age and the size of the national insurance benefits. The liabilities are covered through an insurance company. The calculations are performed by an actuary and are based on the IFRS standard. The annual pension expenses are included under payroll expenses, and they consist of changes in the liabilities and pension funds, as well as contributions to the collective pen-sion scheme. In addition to the aforementioned schemes in Norway, the group’s subsidiaries in Sweden and Denmark have defined contribution pension schemes, and the expenses associated with these schemes are entered under payroll expenses in the income statement.

The expenses broken down into defined contribution and defined benefit schemes are specified in Note 14.

Amounts in NOK 1 000 2006 2005 2004 2006 2005 2004

Thepensioncostfortheyeariscalculatedasfollows:

Net present value of current year’s accrued pension benefits 9�7 405 281 � �94 2 002 1 �15

Interest cost of accrued pension liabilities 179 95 76 669 581 556

Expected return on pension funds -80 -148 -1�5 -448 -529 -454

Amortisation of actuarial gains/losses 126 - - 126 - -

Pensionexpensesfortheyear 1036 352 223 3742 2054 1417

Pensionliabilitiesandpensionfunds:

Estimated uninsured pension liabilities 5 �99 1 86� 1 905 20 525 12 762 11 611

Estimated value of pension funds 1 921 1 672 2 �28 10 494 9 4�6 7 591

Net estimated pension liabilities � 478 191 -42� 10 0�2 � �26 4 020

Unrecognised actuarial gains/losses -� 270 -722 -182 -� 464 770 8

Netpensionliabilitiesinthebalancesheet 208 -531 -605 6568 4096 4028

Changesintheliabilities:

Net pension liabilities as of 1 January -5�1 -605 -�48 4 096 4 028 4 806

Recognised pension expenses 1 0�6 �52 22� � 742 2 054 1 417

Premium payments -297 -278 -480 -1 270 -1 986 -2 194

Netpensionliabilitiesinthebalancesheet 208 -531 -605 6568 4096 4028


The following assumptions have been used for the calculation of the pension expenses and net pension liabilities:

2006 2005 2004

Discount rate 4,5 % 4,5 % 5,0 %

Return on pension funds 5,5 % 5,5 % 6,0 %

Salary inflation 4,0 % �,0 % �,5 %

Annual basic amount adjustment 4,0 % �,0 % �,5 %

Pension adjustment 2,0 % �,0 % �,5 %

Percentage distribution of pension funds by investment category:

2006 2005 2004

Equities 29,7 % 2�,� % 16,6 %

Bonds 20,6 % 17,9 % 18,1 %

Money market 4,5 % 16,8 % 17,2 %

Long-term bonds �0,0 % 27,� % �2,8 %

Real estate 12,6 % 12,2 % 11,8 %

Other 2,6 % 2,5 % �,5 %

The actuarial assumptions are based on the normal assumptions that are used by the insurance industry with regard to demographic factors.


note 10 tax

Summaryoftemporarydifferences 2006 2005 2004 2006 2005 2004

Receivables - - - -599 -619 -20

Current assets - - - -199 -1 499 -1 4�8

Fixed assets -1 801 -2 578 -2 ��2 -5 5�1 -6 109 -6 464

Pensions -208 5�1 605 -6 568 -4 096 -4 028

Work in progress - - - �46 - -

Provisions (in accordance with generally accepted accounting practices) - -720 -2 900 -200 -1 120 -2 900

Shares - - - - - -

Taxable group contributions -19 780 - 18 78� -10 7�4 - - -

Total -21789 -21550 -15361 -12751 -13443 -14850

Tax loss carryforward -1�� 214 -144 812 -157 �5� -1�6 155 -157 888 -165 48�

Totalpositive/negativetemporarydifferences -155003 -166362 -172714 -148906 -171331 -180333

Net deferred tax assets (28 %) 4� 401 46 581 48 �60 41 69� 47 97� 50 49�

Of which off-balance-sheet deferred tax assets - 24 467 22 958 1 616 29 778 28 097

Addition of tax assets from acquisitions - - - - � 920 -

Deferredtaxassetsinthebalancesheet 43401 22114 25402 40077 22114 22396

The deferred tax assets in the balance sheet primarily relate to the tax loss carryforward in the Norwegian companies. These companies are showing stable, growing profits, and based on updated forecasts prepared for the coming year, it is expected that it will be possible to utilise the tax loss carryforward. On the basis of these updated calculations, previously unrecognised deferred tax assets have been recognised in the balance sheet in 2006. Unrecognised deferred tax assets relate to the tax loss carryforward in Sweden. The tax loss can be carried forward indefinitely.

Taxfortheyearconsistsof: 2006 2005 2004 2006 2005 2004

Tax payable in Norway - - - - - -

Tax payable outside Norway - - - 586 142 1 76�

Totaltaxpayable - - - 586 142 1763

Change in deferred tax assets in Norway -21 287 1 779 10 �54 -18 591 2 988 1 254

Change in deferred tax assets outside Norway - - - -4� -6�� -

Change in deferred tax assets from acquisitions - - - 671 - -

Totalchangeindeferredtaxassets -21287 1779 10354 -17963 2355 1254

Unrecognised change in deferred tax assets - 1 508 -11 �96 - 809 710

Totaltaxincome/charge -21287 3287 1042 -18048 3305 3727

Calculationoftaxbasefortheyear 2006 2005 2004 2006 2005 2004

Profit/loss before tax 1� 161 7 898 -� 9�7 20 �59 11 409 11 821

28%tax 3685 2211 -1102 5701 3195 3310

Tax effect of:

Permanent differences -505 -4�2 11 456 -726 -669 -�00

Change in off-balance-sheet deferred tax assets -24 467 1 508 -11 �95 -2� 02� 809 710

Difference in tax rates - - - - - 7

Estimatedtaxesfortheyear -21287 3287 -1041 -18048 3305 3727

Effective tax rate -162 % 42 % 26 % -89 % 29 % �2 %




66

2006 2005 2004 2006 2005 2004

Invoiced in advance - 148 �12 5 9�� 1 066 1 6�2

Unpaid wages/bonuses/holiday pay 2 094 478 1 517 16 152 11 850 14 9�6

Accrued expenses 26 �11 1 4�6 � 162 8 928 4 947 9 711

Totalothercurrentliabilities 28405 2062 4991 31013 17863 26279

Warrantyprovisions

Otherprovisions Total

Warrantyprovisions

Otherprovisions Total

Provisionsasof1January2006 - 12 000 12000 400 12 000 12400

Recognised in the income statement during the year

– Provisions for the year - - - - - -

– Reversal of unutilised provisions - - - -400 - -400

Recognised in the balance sheet during the year - 2� 805 23805 - 2� 804 23804

Utilised during the year - - - - - -

Additions from acquired companies - - - �80 380

Foreign exchange differences - - - - -517 -517

Provisionsasof31December2006 - �5 805 35805 �80 �5 287 35667

Mortgagesandguarantees 2006 2005 2004 2006 2005 2004

Debt secured by mortgage - - - - 2 706 2 601

Guarantees - 1 048 - 882 4 1�� 505

Bookvalueofsecuredassets

Accounts receivable - - - 55 192 6� 2�1 24 121

Inventories - - - 28 996 22 �99 5 989

Total - - - 84188 85630 30110

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES| NOTE 11-12

note 11 other current liabilities

note 12 other provisions for liabilities



OtherprovisionsIn connection with the acquisition of 100 % of the shares in Centrex AS in November 2005 an agreement relating to additional consideration based on Centrex’s profit performance in 2006 and 2007 was entered into. This shall be paid in April 2007 and April 2008, respectively, in the form of shares in Data Respons ASA by reference to the market price. The expected additional consideration is NOK 13.3 million in total, which has been recognised in the balance sheet as a long-term liability. The outcome is dependent on the profit performance of Centrex AS in 2007.

In connection with the acquisition of 100 % of the shares in Embedit A/S (Denmark) in October 2006, an agreement relating to additional considera-tion based on Embedit’s profit performance in 2006, 2007 and 2008 was entered into. This shall be paid in April 2008 and April 2009, respectively, in the form of cash and shares in Data Respons ASA by reference to the market price. The expected additional consideration is NOK 22.5 million in total, which has been recognised in the balance sheet as a long-term liability. The outcome is dependent on the profit performance of Embedit A/S in 2007 and 2008.


A guarantee of NOK 882 000 has been provided in connection with lease agreements. Guarantees and operating credits are secured by a lien on inventory and accounts receivable. A total lien of NOK 11.5 million has been placed on inventories, and a total lien of NOK 19.0 million has been placed on accounts receivable. Sweden has a floating charge of NOK 1.73 million against fixed assets.

67

There have not been any transactions between the company and related parties except intercompany transactions. Reference is made to Note 14 for information on the remuneration of group management and Board of Directors, as well as Note 7 for balances between Data Respons ASA and other group companies.

Payrollexpenses 2006 2005 2004 2006 2005 2004

Wages and salaries 11 �44 6 �74 5 485 94 5�4 65 979 6� 548

Employer’s national insurance contributions 1 582 1 �65 876 14 996 10 129 8 289

Defined benefit pension expenses 1 0�6 �52 22� � 742 2 054 1 417

Defined contribution pension expenses - - - � 054 1 840 -

Other benefits 1 474 284 108 7 612 6 298 6 598

Total 15436 8375 6692 123938 86301 79852 The average number of employees during the financial year was 1� in the parent company. The average number of employees in the group was 177, and there were 226 employees at the end of the year. There were 42 female employees in the group, five of whom were middle managers.

board’s guidelines and principles for the establishment of salaries and other remuneration to key employees In accordance with the provisions of the Public Limited Companies Act, the Board of Directors has prepared the following declaration of guidelines and main principles for the stipulation of salaries and other remuneration of key employees. The object of designing a compensation package for the CEO and other key employees is to provide a competitive package that contains incentives to strive for profitable growth and increase the creation of value for the shareholders within the scope of the company’s adopted values and strategies.

The individual managers shall be paid a fixed basic salary in line with market salaries for corresponding positions in comparable companies in Norway. A variable salary shall be paid in addition to the fixed salary. The variable salary shall be dependent on achieving profitability improvement and growth targets for the group. For the CEO the variable salary shall be a maximum of six monthly salaries, while it shall be a maximum of 2-4 monthly salaries for other key employees.

The company has an option scheme for group management and managers in the group’s subsidiaries. The option scheme has been established to give the company’s management incentives to strive to create value for the shareholders. This scheme is described in greater detail below. The company’s group management is covered by the company’s pension scheme on the same terms as other employees. This pension scheme is described in Note 9.

The CEO is entitled to 12 months’ salary after the termination or amendment of his position/employment. Other members of group management normally have a mutual notice period of six months and no special arrangements.

Shares,optionsandremunerationtotheCEO,keyemployees,BoardofDirectorsandnominationcommittee

Salariesandfees Bonus Pensions

Valueofallottedoptions

Otherbenefits

inkind

Totalremune-

rationNumber

ofsharesNumberof

options

Kenneth Ragnvaldsen, CEO 1 501 782 81 250 2� 448 2�8 500 7 726 1 852 706 245 000 �00 000

Rune Wahl, CFO 1 099 244 65 000 �2 704 159 000 9 726 1 �65 674 60 000 200 000

Åge Gjellesvik, Sales Director 1 0�8 265 40 000 �8 �64 6� 600 9 726 1 189 955 �� 04� 80 000

Hans Christian Lønstad, CTO 1 051 �28 129 155 �7 816 6� 600 9 726 1 291 625 61 956 80 000

Georg Huus, Marketing Director 675 245 15 �1� 20 7�6 6� 600 9 726 784 620 � 000 80 000

Svein R. Goli, Chairman of the Board 96 000 96 000 150 000 -

Anne Cecilie Fagerlie, Director - - - -

Lars-Olof Gustavsson, Director - - 1 000 -

Ingvild Myhre, Director - - - -

Tormod Stene-Johansen, Director 96 000 96 000 60 000 -

Mikkel D. Helweg, Employee representative 17 000 17 000 1 601 -

Øyvind Lien, Director, Employee representative - - 27 511 -

Berit Svendsen, former Chairman of the Board 15� 000 15� 000 - -

Bent Brugård, former Director 84 000 84 000 - -

Ann Kari Heier, former Employee representative 17 000 17 000 - -

Nils-Henrik Petterson, nomination committee member 15 000 15 000 - -

Haakon Sæter, nomination committee member 10 000 10 000 1 252 211 -

Rune Sørum, nomination committee member 10 000 10 000 - -

CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 13-14

note 13 related parties

note 14 payroll expenses, employees, remuneration and loans


On 27 April 2006, the General Meeting resolved that the scope for the Directors’ fees for the 2006 working period should be NOK 684 000, based on the current composition of the Board of Direc-tors. No loans or guarantees have been provided to the Board of Directors, key employees, other employees or their related parties. There are no shareholder agreements.

68 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES| NOTE 14

option programme for employees

Movementsinthenumberofoutstandingshareoptionsandtheassociatedweightedaverageexercisepricesareasfollows: 2006 2005

Averageexerciseprice Options

Averageexerciseprice Options

NOK 1 000 NOK 1 000

Asof1January - - - -

Allotted 16,80 1 420 - -

Forfeited 16,80 -100 - -

Exercised - - - -

Expired - - - -

Asof1December 16,80 1320 - -

Remunerationtotheauditor:2006 2005 2004 2006 2005 2004

Auditing services 255 �10 290 9�8 742 8�1

Other certification services 26 21 �8 41 22 �8

Tax advice 55 �9 50 170 106 159

Other non-auditing services 2�4 40 1� 2�4 59 1�

On 1 March 2006 the Board of Directors of Data Respons ASA approved an option programme for the management and key employees with a total scope of 1 500 000 options. Half of the options have a term of two years, and the other half have a term of three years. The vesting of options is dependent on the employees remaining with the company until the options can be exercised. The allotment date was 27 April 2006, and the exercise price was set at the market price plus 20%.

The fair value of the options allotted to employees has been calculated by means of Black & Scholes’ valuation model for options. The most important input data included the share price of NOK 14.00 on allotment, exercise price of NOK 16.80, estimated volatility of 39.50 % based on the share prices during the period from May 2003 to April 2006, risk-free interest rate of 3.67 %, and a term of two and three years, respectively.

The cost will be accrued over the vesting period with deductions for the estimated number of forfeited options. In 2006 total expenses of NOK 771 000 were charged for the option programme.

Other non-auditing services are mainly related to the adoption of IFRSs and due diligence.


69CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 15-17

Financialincome 2006 2005 2004 2006 2005 2004

Interest received from group companies 1 282 �8 12� - - -

Interest income 595 445 486 1 6�6 869 574

Other financial income 70 24 �2 748 1 526 1 �77

Totalotherfinancialincome 1947 507 641 2384 2395 1951

Financialexpenses 2006 2005 2004 2006 2005 2004

Interest expenses 46 - �9 116 26� �72

Other financial expenses 116 57 49 1 �72 2 115 1 9�0

Totalfinancialexpenses 162 57 88 1488 2378 2302

Liquidassets 2006 2005 2004 2006 2005 2004

Cash and bank deposits 10 069 2� 84� �2 165 29 411 48 266 45 158

– of which restricted funds -57� -�51 -� 147 -� 172 - 5 274 -4 674

Unrestrictedliquidassets 9496 23492 29018 26239 42992 40484

Unutilised short-term credit facilities 5 049 6 967 4 442 5 049 6 967 4 442

Liquidityreserve 14545 30459 33460 31288 49959 44926

The Data Respons Group has established a corporate account system in which Data Respons ASA is the corporate account holder, while the other group companies are subaccount holders. The bank can set off any withdrawals or deposits against each other, so that the net position represents the balance between the bank and Data Respons ASA.

2006 2005 2004 2006 2005 2004

Expenses related to premises and equipment 1 7�7 925 1 065 11 446 6 685 10 559

External services 1 700 1 447 1 �64 5 826 � 146 2 559

Advertising and directory expenses 998 609 509 5 29� � 544 4 468

Other operating expenses 2 540 8�6 1 881 1� ��1 12 442 4 2�8

Other intercompany operating expenses -14 055 -8 45� -4 �60 - - -

Total -7080 -4636 459 35896 25817 21824

note 15 specification of financial items




note 16 liquid assets

note 17 other operating expenses

70 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES | NOTE 18-20

DataResponshasbeenawardedthefollowinggrantsbytheResearchCouncilofNorwayin2006:

Company Project: Grant(NOK1000)

Data Respons Norge AS MPC-PC for extreme conditions 591

Centrex AS VHF data modem 401

The company’s main financial market risk relates to:

PensionsThe pension risk consists of actuarial risk and financial risk. The actuarial risk is linked to the fact that the pension liabilities may be higher than as-sumed in the actuarial assumptions that form the basis for calculating pension liabilities. Financial risk relates to the possibility that the pension funds will achieve a lower return than assumed.

ExchangerateriskMost groups are exposed to exchange rate fluctuations because they make purchases from abroad. On account of our fast turnover rate for pur-chased goods the group is only exposed to limited risk from this, and therefore we did not use any hedging instruments in 2006.

CreditriskThe vast majority of the group’s sales are to blue-chip companies, and in the past the group has had few losses on receivables.

All of these projects are approved as R&D projects covered by the SkatteFUNN scheme in accordance with Section 16-40 of the Taxation Act. A total of NOK 999,000 has been allocated to the projects, and this has been included in the balance sheet under other receivables. NOK 999,000 has been recognised in the income statement as a reduction in payroll expenses and other operating expenses.

In January 2007 Data Respons ASA acquired 100% of the Swedish company Syrén Software AB. NOK 5.9 million was paid for the shares, and ad-ditional consideration dependent on the company’s profit performance for the years 2007 and 2008 was agreed. As of 31 January 2007 provisions for a liability of NOK 9.0 million have been recognised in respect of the additional consideration.

note 18 risk

note 19 government grants

note 20 events after the balance sheet date

71CONSOLIDATED FINANCIAL STATEMENTS AND NOTES| AUDITORS REPORT

Auditor’s report

72

Prevents the formation of toxic gas

IN SEWAGE SYSTEMS

REFERENCE CUSTOMER: YARA INTERNATIONAL ASA

Data Respons has developed, in cooperation with Yara, the process control-ler for Yara’s Nutriox concept, which prevents the formation of toxic, strong-smelling gas in sewage systems.

The solution must be able to withstand damp and corrosive environments with H2S gas that devel-ops in the sewage network. Data Respons was chosen as the partner for development of the process controller because the company has a high level of expertise in both hardware and software devel-opment and good supplier connections. In addition, Data Respons could solve all the needs related to function, physical requirements and delivery, and also met the ISO certification requirement.

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Prevents the formation of toxic gas

IN SEWAGE SYSTEMS

Read more at www.datarespons.com/yara

74

Addresses

ADDRESSES

SWEDEN

Data Respons ABKanalvägen 12, InfraCitySE-194 61 UPPLANDS VÄSBYTel.: +46 8 501 688 00 Fax: +46 8 501 688 01 [email protected]

Syrén Software ABc/o Huber+SuhnerKnarrarnäsgatan 7SE-164 28 KISTATel.: +46 8 642 37 50Fax: +46 31 707 14 [email protected] syrensoftware.se

STOCKhOLM

gOThENBURgSyrén Software ABTheres Svenssons Gata 10SE-417 55 GÖTEBORGTel.: +46 31 707 14 80Fax: +46 31 707 14 [email protected] syrensoftware.se

GERMANY

KARLSRUhEData Respons GmbHEmmy-Noether-Str. 11DE-76131 KARLSRUHETel.: +49 721 6105 3210 Fax: +49 721 6105 3211 [email protected]

FINLAND

hELSINKIData Respons OYInnopoliTekniikantie 12SF-02150 ESPOOTel.: +358 9 2517 3009 Fax: +358 9 2517 [email protected]

NORWAY

OSLOData Respons Norge ASSandviksveien 26Postboks 489NO-1�2� HØVIKTel.: +47 67 11 20 00 Fax: + 47 67 11 20 50 [email protected]

Data Respons Norge ASOlaf Helsets vei 5SkullerudNO-0694 OSLOTel.: +47 22 74 87 00 Fax: +47 22 74 87 01 [email protected]

Centrex ASLøkketangen 20Postboks 1�71�00 SANDVIKA Tel.: +47 67 54 21 05 Fax: +47 67 54 21 06 [email protected]

BERgENData Respons Norge ASKokstadveien 26Postboks 44 KokstadNO-586� BERGENTel.: +47 55 11 47 80 Fax: +47 55 11 47 99 [email protected]

KONgSBERgData Respons Norge ASKongsberg NæringsparkPostboks 1022NO-�601 KONGSBERGTel.: +47 32 29 94 00Fax: +47 32 29 94 40 [email protected]

Embedit A/SGeneratorvej 8a DK-2730 HERLEVTel.: +45 70 25 55 75Fax: +45 70 25 55 [email protected] www.embedit.dk

Data Respons A/SHørkær 18, 1DK-2730 HERLEVTel.: +45 44 50 85 00 Fax: +45 44 50 85 05 [email protected]

COpENhAgEN

SØNDERBORgEmbedit A/SStenager 2 DK-6400 SØNDERBORGTel.: +45 70 25 55 75Fax: +45 70 25 55 [email protected] www.embedit.dk

ÅRhUSEmbedit A/SSøren Frichs Vej �8K DK-82�0 ÅBYHØYTel.: +45 70 25 55 75Fax: +45 70 25 55 [email protected] www.embedit.dk

DENMARK

HEADQUARTERS

OSLOData Respons ASASandviksveien 26NO-1�2� HØVIKTel.: +47 67 11 20 00 Fax: + 47 67 11 20 55 [email protected] DESIGN & TEXT

Data Respons ASAPHOTOSIstock, Getty, Bård Gudim

BERGEN

OSLOKONGSBERGHELSINKI

STOCKHOLM

GOTHENBURG

COPENHAGEN

SØNDERBORG

ÅRHUS

KARLSRUHE

EMBEDDED SOLUTIONSIN EUROPE BY 2010

LEADER IN

LINKÖPING

www.datarespons.com

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