===== SIDA 1 ===== 1 ===== SIDA 2 ===== 2 Highlights Q1 Financial Highlights • Streaming revenue up 6% from Q1 2022 to 742 (699) MSEK, 9% excluding Russia • Group net sales increased by 7% from Q1 2022 to 796 (747) MSEK, 10% excluding Russia • Gross profit of 316 (288) MSEK, equaling a 39.6 margin (38.6) % • EBITDA of 30 (-149) MSEK equaling a margin of 3.8 (-19.9) % • Basic and diluted earnings per share amounted to -0.81 (-3.43) SEK • Cash flow from operations before changes in working capital amounted to 18 (-135) MSEK • Operational cash flow amounted to -8 MSEK versus -122 MSEK Q1 Other Highlights • Anna Etzler appointed SVP Operations • Oleg Nesterenko appointed Chief Marketing Officer • Peter Messner appointed Chief Financial Officer • The Finnish audiobook service Suomalainen Plus merges its subscriber base with Storytel Finland Highlights after the End of the Quarter • Significant multi-year agreement with Bulgaria’s largest telco A1 Bulgaria. The deal makes Story- tel part of exclusive selection of premium services on A1 Bulgaria’s platform, reaching more than 4 million potential customers • Storytel Awards surpasses the milestone of 200,000 votes – audiobook fan engagement soaring to record levels • Storytel announced that the company will hold a Capital Markets Day on June 13, 2023 ===== SIDA 3 ===== 3 CEO-statement Creating the foundation for sustainable and profitable growth The first quarter of 2023 saw continued progress in the execution of our profitable growth strategy as we extended our focus on improving operational and financial performance over time. The first quarter marked the fourth consecutive quarter of positive Group EBITDA. Storytel Streaming saw continued organic streaming rev- enue growth, increased ARPU, strong subscriber engagement as well as stable churn levels. Lay- ing the foundation for further profitable growth in 2023 and beyond, we continued to drive near- term operational improvement programs across all parts of our business delivering progress with renegotiated and new signed Partnerships, im- proved Content economics, and the introduction of new service tiers and price levels in the Nor- dics. We are now in the final phase of complet- ing our strategic plan and mid-term financial tar- gets, which will be presented at our Capital Mar- kets Day in Stockholm on June 13. Our financial development Streaming revenue excluding Russia increased by 9%, and amounted to 742 MSEK, driven by a solid performance in the Nordic region. ARPU grew with 6% to 121 SEK. Group Net Sales for the quarter grew 10% excluding Russia and to- taled 796 MSEK. The gross margin was 39.6%, an increase by 1.0 percentage point versus the same quarter last year, and by 2.4 percentage points versus Q4 2022. The EBITDA margin im- proved to 3.8%, compared to a negative margin of 4.4% in Q1 2022, adjusted for items affecting comparability last year. Cash flow from operations before changes in working capital generated a total of 18 (-135) MSEK and operational cash flow amounted to -8 MSEK versus -122 MSEK last year. The improve- ment was derived from the strategic shift to fo- cus on profitable growth. Unlocking large untapped potential As a market leader in the Nordics and several other countries, we enjoy strong consumer trust, and our reputation is synonymous with quality. While we continue to grow our sub- scriber base, we are increasingly focused on attracting and retaining the most valuable cus- tomers with high levels of loyalty, high ARPU, and long lifetime value. In the context of this shift away from exclusively prioritizing growth of our subscriber base to cap- ture a larger share of the sector’s value, we re- cently completed the rollout of our new multi- tiered product offering in Finland, Sweden and Denmark. With this, we’ve expanded our ad- dressable market and provide an attractive op- tion for every type of listener. Early indications from the launch are positive, and we’re encour- aged by the impact on SAC, ARPU and Churn. Unlimited remains the most popular subscrip- tion among customers in Sweden, Denmark and Finland. Promising start for the new Partnerships Team In the fourth quarter last year, we announced the formation of our new Partnerships team, which is dedicated to bringing more listeners through partners such as mobile app stores, OEMs, telcos, financial services and e-commerce players. This quarter saw the successful launch of our service on Google CarPlay and Apple CarPlay, in line with our target to make Storytel available on all relevant audio devices and plat- forms popular with our customers. In the first quarter, we announced the agree- ment with Suomalainen Plus, the audiobook op- erations of the bookstore chain Suomalainen Kir- jakauppa, merging its subscriber base with Storytel Finland. The agreement strengthens our position in the Finnish market. In April, we closed a significant multi-year agree- ment with Bulgaria’s largest telco, A1 Bulgaria, a part of the A1 Group that currently has over 26 million users across seven European countries. This agreement allows Storytel Bulgaria access to 4 million potential customers. ===== SIDA 4 ===== 4 The Road to Success requires great Content Storyside, our internal audiobook publisher, con- tinues to prove itself as a strong driver of sub- scriber acquisition. During the quarter, almost 12% of new Storytel subscribers in Sweden, Den- mark and Finland selected a Storyside title as their first book for listening. We’ve recently completed the renegotiation of several of our largest content distribution agreements in our core markets, improving the cost efficiency of these contracts. To further decrease content cost is an important lever to grow our EBITDA over time. Near term guidance Our full-year guidance from February remains unchanged with organic streaming revenue growth in line with the previous year (excluding Audiobooks.com and Russia), an increased EBITDA margin (adjusted for last year’s items af- fecting comparability) versus 2022 and at least a break-even operational cash flow (EBITDA – op- erational capex). Finally, I want to take this opportunity to wel- come all of you to Storytel’s Capital Markets Day, which will be held on June 13 in Stockholm, Sweden. At the event, we will provide an update on Storytel’s position and operations as well as our strategy and financial targets. I look forward to seeing you in June. Stockholm in May Johannes Larcher, CEO ===== SIDA 5 ===== 5 Table 1: Key Performance Indicators TSEK Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Streaming Total1 Revenue 698,599 704,454 742,426 742,283 742,081 Revenue excl Russia 679,654 693,464 732,837 742,374 742,081 Gross profit 283,868 278,554 307,463 304,594 317,067 Gross margin 40.6% 39.5% 41.4% 41.0% 42.7% Avg. Paying Subscribers 2,051,000 2,031,000 2,064,000 2,036,000 2,041,000 ARPU (SEK/month) 114 116 120 122 121 Streaming Nordics1 Revenue 458,555 469,390 492,765 498,336 496,630 Gross profit 165,788 177,354 189,289 184,767 200,992 Gross margin 36.2% 37.8% 38.4% 37.1% 40.5% Avg. Paying Subscribers 1,061,000 1,078,000 1,129,000 1,132,000 1,125,000 ARPU (SEK/month) 144 145 145 147 147 Streaming Non-Nordics Revenue 240,044 235,064 249,662 243,947 245,451 Revenue excl Russia 221,099 224,074 240,073 244,038 245,451 Gross profit 118,080 101,190 118,173 119,828 116,075 Gross margin 49.2% 43.0% 47.3% 49.1% 47.3% Avg. Paying Subscribers 990,000 953,000 935,000 904,000 916,000 ARPU (SEK/month) 81 82 89 90 89 Books Revenue 149,305 156,999 147,199 193,069 130,083 Gross profit 84,399 78,185 81,916 85,141 68,472 Gross margin 56.5% 49.8% 55.6% 44.1% 52.6% Group total2 Revenue 747,170 780,730 805,819 866,663 796,293 Gross profit 288,498 290,363 311,907 322,377 315,501 Gross margin 38.6% 37.2% 38.7% 37.2% 39.6% Revenue Growth YoY Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Streaming Total1 Revenue 35.1% 29.2% 27.3% 22.7% 6.2% Revenue excl Russia 35.3% 31.0% 29.5% 27.0% 9.2% Revenue – CER 32.6% 25.6% 22.0% 16.6% 2.9% Streaming Nordics1 Revenue 14.1% 10.9% 10.2% 8.6% 8.3% Revenue – CER 11.0% 8.5% 6.9% 4.8% 6.8% Streaming Non-Nordics Revenue 108.3% 92.5% 83.7% 67.0% 2.3% Revenue excl Russia 120.3% 111.6% 102.2% 94.5% 11.0% Revenue – CER 107.9% 85.1% 71.7% 53.5% -4.7% Books Revenue 19.3% 4.7% -18.3% -5.5% -12.9% Revenue – CER 17.8% 3.6% -19.4% -7.0% -14.6% 1 Storytel Norway is included in the figures @ 100%. 2 In the consolidated accounts, Norway is reported in accordance with the equity method. As a result, the Streaming revenue lis ted in Table 1 is higher than in the consoli- dated statement of accounts in order to provide a more accurate figure for average revenue per subscriber. Please see Note 5 for additional details. ===== SIDA 6 ===== 6 Developments during the quarter, Group Comparative figures pertain to Q1 2022 Net sales Net sales for the period increased by 7% com- pared to the comparative period and totaled 796.3 (747.2) MSEK. This increase is primarily driven by solid growth in the Streaming segment across Storytel’s top markets, especially the Nor- dic region, while the Books segment saw a de- crease versus the last quarter due to seasonality. Average paying streaming subscribers increased by over 5,000 during the quarter and amounted to 2,041,000 with an average ARPU of 121 (114) SEK. The decrease in the subscriber base versus the same quarter last year is explained by an in- tensified focus on quality and lifetime value. Gross profit Cost of sales for the period totaled -480.8 (-458.7) MSEK. Gross profit amounted to 315.5 (288.5) MSEK, which equals a gross margin of 39.6% (38.6%). The gross margin increased by 1 percentage point versus the same quarter last year, and by 2.4 percentage points versus the fourth quarter of 2022. The improvement was mainly explained by positive development from the streaming business in the Nordic region. EBITDA EBITDA for the period totaled 30.5 (-148.5) MSEK, which equals an EBITDA margin of 3.8% (-19.9%). The first quarter last year contained items affecting comparability of 116 MSEK, adjusted for this, the EBITDA last year amounted to -32.8 MSEK. The significant improvement is driven by the strategic shift to focus on profita- ble growth. Operating profit Operating profit for the quarter totaled -48.0 (-226.9) MSEK. The comparable quarter included items affecting comparability totaling -133.5 MSEK. The improvement was to a large extent derived from the above outlined strategic shift to focus on profitable growth. Sales and marketing expenses decreased by 30% to -205.7 (-294.5) MSEK. The comparable quar- ter included items affecting comparability total- ing -19.5 MSEK. Technology and development expenses totaled - 69.5 (-96.3) MSEK, which includes continuous in- vestments in the platform, striving to increase subscriber engagement. The comparable quarter included items affecting comparability totaling -43.3 MSEK. General and administrative expenses totaled -97.1 (-129.7) MSEK. The comparable quarter in- cluded items affecting comparability totaling -59.7 MSEK. Group total Q1 2023 Q1 2022 Net sales 796.3 747.2 Cost of sales -480.8 -458.7 Gross profit 315.5 288.5 Selling and marketing expenses -205.7 -294.5 Technology and development ex- penses -69.5 -96.3 Administrative expenses -97.1 -129.7 Other operating income 5.3 6.0 Profit from participations in asso- ciates 3.5 -0.9 Operating profit/loss -48.0 -226.9 Net financial items -16.2 -6.4 Profit before tax -64.3 -233.3 ===== SIDA 7 ===== 7 Net profit Profit before tax for the period amounted to -64.3 (-233.3) MSEK. Net financial items for the period totaled -16.2 (-6.4) MSEK. The amount includes an unrealized negative FX effect from a USD de- nominated commitment derived from the acqui- sition of Audiobooks.com, amounting to -3.4 MSEK. Excluding this, the underlying cost has in- creased due to higher interest rates. Taxes for the quarter amounted to 2.5 (0.9) MSEK. Net profit for the quarter amounted to -61.7 (-232.5) MSEK. Earnings per share for the period totaled -0.81 (-3.43) SEK, before and after dilution. Cash flow Cash flow from operating activities before changes in working capital was 17.8 (-135.2) MSEK, with the improvement driven by the stra- tegic shift to focus on profitable growth. The change in working capital was 3.9 (45.0) MSEK, resulting in cash flow from operating activities of 21.7 (-90.2) MSEK for the period. Cash flow from investing activities was -47.8 (-950.7). Cash flow from financing activities was -212.3 (571.8) MSEK. Total cash flow for the period was -238.4 (-469.1) MSEK. ===== SIDA 8 ===== 8 Other information Financial position, equity & liquidity (com- pared to March 31, 2022) At the end of the period, the Group had 540.4 (447.6) MSEK in cash and cash equivalents. The equity-to-asset ratio at the end of the period was 52.1% (42.3%). Total equity for the quarter was 2,122.3 (1,705.7) MSEK. Non-current liabilities totaled 991.9 (888.7) MSEK. The company has a revolving credit facil- ity (RCF) of 850 MSEK, of which 700 MSEK is uti- lized, whereof 100 MSEK has been utilized in Q1, 2023. Current liabilities amounted to 949.5 (1,438.1) MSEK. A bridge loan facility of 500 MSEK utilized in connection with the acquisition of Audiobooks.com has been replaced with a 200 MSEK term loan during the quarter. Total available liquidity (cash and cash equiva- lents and unutilized RCF) totalled 690.4 MSEK at the end of the period. Parent Company Storytel AB is the Group’s Parent Company and responsible for Group-wide management, ad- ministration and financing. Net sales for the Parent Company amounted to 8.8 (5.8) MSEK. Profit before tax amounted to - 5.2 (1.4) MSEK, and profit/loss for the period amounted to -5.2 (1.4) MSEK. Total equity amounted to 4,204.0 (3,821.6) MSEK. The con- densed income statement and balance sheet for the Parent Company are presented on page 21. Investigation in Turkey The Turkish Competition Authority has notified Storytel Turkey Yayincilik Hizmetleri A.S. (“Story- tel Turkey”) that it has opened an investigation into Storytel Turkey on the basis of a complaint from a third party in Turkey. Storytel is cooper- ating with the Turkish Competition Authority, but it is too early to determine or predict the outcome of the investigation. Risks and uncertainty factors The Group is subject to significant risks and un- certainties. As noted in the 2022 Annual Report, these factors include the prevailing economic and business environments in each of the Group’s markets; commercial risks related to ex- pansion into new territories; political and legisla- tive risks related to changes in rules and regula- tions in the various territories in which the Group operates; exposure to foreign exchange rate movements; changes in the ability to access capital markets; and the emergence of new technologies and competitors. More recently, we have seen inflationary pressures that could affect the purchasing power of our consumers, and thus in the long term also their willingness and ability to remain as subscribers. Further- more, given the developments in Ukraine, Story- tel announced in the first quarter of 2022 its in- tention to pause its operations in Russia. This has been implemented, and the operations were phased out during the third quarter of 2022. As of March 31, 2022, there is no significant bal- ance sheet exposure related to Russia. ===== SIDA 9 ===== 9 Guidance Storytel’s full-year guidance from February remains unchanged: • Organic streaming revenue growth in line with previous year (excluding Audiobooks.com and Russia) • Increased EBITDA margin (adjusted for items affecting comparability) versus 2022 • At least a break-even operational cash flow (EBITDA - operational capex). ===== SIDA 10 ===== 10 Financial Statements Summary Group Condensed Income Statement TSEK Q1 2023 Q1 2022 Q1–Q4 2022 Net sales 796,293 747,170 3,200,382 Cost of sales -480,792 -458,672 -1,987,237 Gross profit 315,501 288,498 1,213,145 Sales and marketing expenses -205,725 -294,480 -942,799 Technology and development expenses -69,465 -96,342 -322,699 General and administrative expenses -97,144 -129,684 -370,020 Other operating income 5,335 5,958 34,424 Result from participations in associates 3,450 -869 -1,070 Operating profit/loss -48,048 -226,919 -389,019 Net financial items -16,223 -6,413 5,347 Profit/loss before taxes -64,271 -233,332 -383,672 Tax 2,530 876 3,402 Profit/loss for the period -61,741 -232,456 -380,270 Profit for the period attributable to: Parent Company shareholder -62,789 -233,940 -382,957 Non-controlling interest 1,048 1,484 2,687 Earnings per share, SEK Group total, basic -0.81 -3.43 -5.51 Group total, diluted -0.81 -3.43 -5.51 Statement of comprehensive income Profit/loss for the period, after tax -61,741 -232,456 -380,270 Other comprehensive income Items that will be reclassified to profit/loss (after tax) Translation difference -9,034 17,370 160,132 Items that will not be reclassified to profit/loss (after tax) Revaluation of defined-benefit pension plans -3,483 - 106,538 Revaluation of hedging instruments - 8,580 8,580 Total other comprehensive income for the period, after tax -12,517 25,950 275,250 Total comprehensive income for the pe- riod, after tax -74,258 -206,506 -105,020 ===== SIDA 11 ===== Total comprehensive income for the pe- riod attributable to: Parent Company shareholder -75,306 -207,990 -107,707 Non-controlling interest 1,048 1,484 2,687 Group Condensed Consolidated Statement of Financial Position TSEK 3/31/2023 3/31/2022 12/31/2022 Intangible assets 2,583,751 2,537,076 2,622,416 Tangible assets 26,981 29,954 28,990 Right-of-use assets 115,459 122,350 112,355 Non-current financial assets 75,123 93,642 87,690 Inventory 103,443 82,968 102,107 Current receivables 618,497 718,905 658,581 Cash and cash equivalents 540,432 447,627 776,341 Total assets 4,063,686 4,032,522 4,388,480 Equity 2,122,316 1,705,678 2,192,950 Non-current liabilities 991,883 888,707 866,369 Current liabilities 949,487 1,438,136 1,329,161 Total equity and liabilities 4,063,686 4,032,522 4,388,480 ===== SIDA 12 ===== 12 Condensed Statement of Changes in Equity TSEK Q1 2023 Q1 2022 Q1–Q4 2022 Opening equity for the period 2,192,950 1,910,603 1,910,603 Profit/loss for the period -61,741 -232,456 -380,270 Non-controlling interest - - -6,449 Other total comprehensive income for the year: Translation difference -9,034 17,370 162,820 Revaluation of defined-benefit pension plans -3,483 - 106,538 Hedge accounting - 8,580 8,580 Transfer of cash flow hedge to business combinations - 1,451 1,451 Transactions with owners: Share issue -1,074 - 391,068 Share based incentive programs 4,698 129 -1,391 Closing equity for the period 2,122,316 1,705,678 2,192,950 Group Condensed Cash Flow Statement TSEK Q1 2023 Q1 2022 Q1-Q4 2022 Profit/loss after financial items -64,271 -233,332 -383,672 Where of interest paid -14,438 -8,822 -28,761 Adjustments for non-cash items 84,245 101,010 288,614 Taxes paid -2,207 -2,853 -22,517 Cash flow from operations before changes in work- ing capital 17,767 -135,175 -117,575 Change in working capital 3,905 44,996 17,130 Cash flow from operating activities 21,672 -90,179 -100,445 Cash flow from investing activities -47,809 -950,680 -1,141,390 Cash flow from financing activities -212,281 571,758 1,085,350 Cash flow for the period -238,418 -469,101 -156,485 Available funds at the beginning of period 776,341 905,882 905,882 Cash flow for the period -238,418 -469,101 -156,485 Translation differences in available funds 2,509 10,846 26,944 Available funds at end of period 540,432 447,627 776,341 ===== SIDA 13 ===== 13 Note 1 Accounting and Valuation Principles This interim report includes the Swedish Parent Company Storytel AB (publ), CIN 556575-2960, and its subsidiaries. Storytel is one of the world's largest streaming services for audiobooks and e-books and has more than 700,000 titles in the service globally. Our vision is to make the world a more empathetic and creative place through fantastic stories that can be shared and appreciated by anyone, anywhere and at any time. The Streaming operations within Storytel Group take place under the brands Storytel, Mofibo and Audiobooks.com. The publishing business is managed by Storytel Books and the audiobook publisher Storyside. Storytel Group is present in over 25 markets. The Parent Company is a limited liability company with its registered office in Stockholm, Sweden. The address of the head office is Tryckerigatan 4, 111 28 Stockholm, Sweden. Storytel applies the International Financial Reporting Standards (IFRS) as they have been adopted by the EU. This consolidated interim report was prepared in accordance with IAS 34 Interim Financial Reporting, recommendation RFR 1 issued by the Swedish Financial Reporting Board, and the Annual Accounts Act (1995:1554), where applicable. The interim report for the Parent Company was prepared in accordance with Chapter 9 of the Annual Ac- counts Act (Interim Report) and recommendation RFR 2 issued by the Swedish Financial Reporting Board. The same accounting principles, bases for calculation and assessments were applied to the Group and the Parent Company as in the most recent annual report. A detailed description of the Group’s other applied accounting principles and new and pending standards is included in the most recently published Annual Report. During 2022, Turkey was defined as a hyperinflationary economy and as such the Group applies IAS 29 related to its entity in Turkey. There are no new IFRS standards or amendments of existing IFRS standards during 2023 that have had a material impact on the performance and financial position of Storytel. Disclosures pursuant to IAS 34.16A are also presented in the financial statements and related notes in the interim disclosures on pages 10-12, which is an integral part of this financial statement. All amounts in this statement are stated in thousands of Swedish krona (TSEK) unless otherwise specified. Differences in rounding may occur. ===== SIDA 14 ===== 14 Note 2 Significant estimates and judgements When preparing the financial statements, the company’s management and the Board must make certain assessments and assumptions that affect the carrying amounts of asset and liability items and income and expense items, respectively, as well as other information provided. The assessments are based on experi- ences and assumptions that the management and the Board deem to be reasonable given the prevailing circumstances. Actual outcome may then differ from these assessments if other conditions arise. The esti- mates and assumptions are evaluated on an ongoing basis and are not considered to entail any material risk of significant adjustments in the reported values of assets and liabilities during subsequent periods. Changes in estimates are reported in the period in which the change is made if the change has only af- fected this period, or in the period in which the change is made and future periods if the change affects both the current period and future periods. For other significant estimates and judgements, please refer to the most recent annual report. Note 3 Definitions and key ratios including alternative performance measures Storytel reports a number of different items and financial key ratios in its consolidated financial state- ments. The key ratios aim to make it easier for investors and other stakeholders to analyze and under- stand Storytel's operations and development in the same way that the business and its development are monitored by management. Of these measures, some are defined in IFRS, while others are defined in nei- ther the financial framework nor other legislation. For key ratios that are not defined in IFRS, this report presents their purpose and how they relate to the financial statements presented in accordance with IFRS. For definitions of financial measures and key ratios used, please see below. Note 4 Transactions with related parties In general, there were no significant changes in the scope or type of transactions with related parties to the Group other than those presented in the most recent Annual Report. Transactions with associated companies take place on market terms. ===== SIDA 15 ===== 15 Note 5 Business segments The Group, for accounting and follow-up, has divided its operations into three segments: Streaming Nor- dics, Streaming Non-Nordics and Books. The division is based partly on the type of business conducted (Streaming versus Books) and the geographical division for the streaming business (Nordics versus Non- Nordics). The acquired company Audiobooks.com is included in the business segment Streaming Non- Nordics. Jan-Mar 2023 Streaming Nordics Streaming Non- Nordics Books Total segment Group-wide items and eliminations Other adjustments Group to- tal Revenue from external customers 496,630 245,451 130,083 872,163 -90,555 14,684 796,293 Internal revenue - - 48,062 48,062 -48,062 - - Cost of sales -295,638 -129,375 -109,672 -534,685 58,305 -4,411 -480,792 Gross profit 200,992 116,075 68,472 385,540 -80,312 10,273 315,501 The costs listed under Gross profit are not allocated to segments but are reported for the Group as a whole. Internal revenue for the Books segment that relates to sales from streaming is already included as a cost reduction in the segment reporting for the Streaming segments. Revenue and Cost of sales from Storytel AS are included in the Streaming Nordics segment. These are subsequently eliminated in the col- umn Group-wide items and eliminations, and the license fee from Storytel AS is also added back. ===== SIDA 16 ===== 16 Group total Jan-Mar 2023 Gross profit 315,501 Selling and marketing expenses -205,725 Technology and development expenses -69,465 Administrative expenses -97,144 Other operating income 5,335 Profit from participations in associates 3,450 Operating profit/loss -48,048 Net financial items -16,223 Profit/loss before tax -64,271 The costs listed under Gross profit are not allocated to segments but are reported for the Group as a whole. Internal revenue for the Books segment, which relates to sales from streaming, is already included as a cost reduction in the segment reporting for the Streaming segments. Revenue and Cost of sales for Storytel AS are included in the Streaming Nordics segment. These are subsequently eliminated in the col- umn for Group-wide items and eliminations, and the license fee from Storytel AS is also added back. Group total Jan-Mar 2022 Gross profit 288,498 Selling and marketing expenses -294,480 Technology and development expenses -96,342 Administrative expenses -129,684 Other operating income 5,958 Profit from participations in associates -869 Operating profit/loss -226,919 Net financial items -6,413 Profit/loss before tax -233,332 Jan-Mar 2022 Streaming Nordics Streaming Non- Nordics Books Total segment Group-wide items and eliminations Other adjustments Group to- tal Revenue from external customers 458,555 240,044 149,305 847,904 -87,603 -13,131 747,170 Internal revenue - - 38,108 38,108 - 38,108 - - Cost of sales -292,767 -121,964 -103,014 -517,745 66,884 -7,811 -458,672 Gross profit 165,788 118,080 84,399 368,267 -58,827 -20,942 288,498 ===== SIDA 17 ===== 17 Note 6 Revenue from contracts with customers Jan-Mar 2023 Books Streaming Other Group total Type of product or service Revenue from subscriptions of streaming service - 651,526 - 651,526 Revenue from publishing activities 130,083 - - 130,083 Other - - 14,684 14,684 Revenue from contracts with customers 130,083 651,526 14,684 796,293 Jan-Mar 2022 Books Streaming Other Group total Type of product or service Revenue from subscriptions of streaming service - 591,630 - 591,630 Revenue from publishing activities 149,305 - - 149,305 Other - - 6,235 6,235 Revenue from contracts with customers 149,305 591,630 6,235 747,170 ===== SIDA 18 ===== 18 Note 7 Financial instruments Valuation hierarchy The levels of the valuation hierarchy are described as follows: Level 1 – Listed prices (unadjusted) in active markets for identical assets and liabilities. Level 2 – Observable input data for the asset or liability other than quoted prices included in Level 1, either directly (i.e., price quotations) or indirectly (i.e., derived from price quotations). Level 3 - Asset or liability input data that is not based on observable market data (i.e., non-observable in- put data). Acquisition option Storytel's acquisition option refers to the future acquisition of the remaining 10,2 % shares in Earselect AB, which will result in an additional transferred consideration of 8,237 TSEK, after the consideration paid in the quarter, see note 8. The acquisition option is reported at fair value in the statement of financial po- sition, measured in accordance with IFRS 9 and categorized in accordance with Level 3 of the IFRS 13 fair value hierarchy. Since the price of the option is not dependent on any conditions beyond the time aspect, and since the discounting effect attributable to the time value at the time of acquisition was insignificant, no discounting has taken place, and the carrying amount is considered to correspond to the fair value of the acquisition option. Contingent consideration The contingent consideration related to the acquisition of Aula is reported at fair value in accordance with Level 3 of the valuation hierarchy. The fair value is estimated by using a valuation model that discounts the present value of expected outgoing cash flows by a risk-adjusted discount rate. Expected cash flows are determined using probable scenarios based on expected financial outcome and future financial fore- casts. The most significant input factors used to measure fair value are the risk-adjusted discount rate of 12.6% and the forecast future development of profitability, growth in net sales, and the level of digital sales. Given that the contingent additional consideration at the balance sheet date can amount to at the most TSEK 761 no changes in input factors are judged to result in any material impact on the fair value of the item in the balance sheet or income. During the period, unrealized gains or losses for the contingent consideration held as at the balance sheet date are not material. This amount is included in other operat- ing expenses in the consolidated statement of income. The discounting effect is recognized in net financial income. Financial liabilities valued at fair value Jan-Mar 2023 Jan-Mar 2022 Jan-Dec 2022 Opening balance 13,124 23,095 23,095 Consideration paid -4,275 - - Change in value recognized in profit/loss - - 48 Change in value recognized in OCI - financial derivative - -8,580 -8,580 Transfer of cash flow hedge to business combinations - -1,451 -1,451 Closing balance 8,849 13,064 13,124 ===== SIDA 19 ===== 19 Other receivables and liabilities For current receivables and liabilities, such as accounts receivable and trade payables, and for non-current liabilities with variable interest rates, the carrying amount is considered to be a good approximation of the fair value. ===== SIDA 20 ===== 20 Note 8 Business combinations The purchase price allocation for Audiobooks.com, acquired in January 2022, has now been finalied. No adjustment has been made in the period. A consideration for Storytel’s acquisition option in Earselect has been paid during the quarter with 4,275 TSEK. ===== SIDA 21 ===== 21 Parent Company Condensed Income Statement TSEK Q1 2023 Q1 2022 Q1-Q4 2022 Net sales 8,820 5,845 43,096 Cost of revenue - - - Gross profit 8,820 5,845 43,096 Administrative expenses -8,000 -13,384 -54,223 Other operating income - - 224 Profit from participation in group company - - 15,608 Operating profit 820 -7,539 4,705 Net financial items -5,999 8,919 -5,258 Profit/loss before taxes -5,179 1,380 -553 Tax - - -1,437 Profit/loss for period -5,179 1,380 -1,990 Parent Company´s condensed statement of comprehensive income Profit for the period Other comprehensive income, after tax -5,179 1,380 -1,990 Total comprehensive income for the period -5,179 1,380 -1,990 Condensed Balance Sheet TSEK 31 Mar 2023 31 Mar 2022 31 Dec 2022 Non-current financial assets 4,848,935 4,048,445 4,848,935 Current receivables 211,143 655,918 228,412 Cash and cash equivalents 197,432 82,001 365,813 Total assets 5,257,510 4,786,364 5,443,160 Equity 4,203,990 3,821,603 4,210,537 Non-current liabilities 748,416 447,933 598,416 Current liabilities 305,104 516,828 634,207 Total equity and liabilities 5,257,510 4,786,364 5,443,160 ===== SIDA 22 ===== 22 Number of shares and share capital as of March 31, 2023 There were 77,073,120 (68,281,911) registered shares in issuance at the end of the period, divided be- tween 635 Class A shares and 77,072,485 Class B shares. Share capital totaled 38,536,560 (34,140,956) SEK as of Dec 31, 2022. There were 73,002,135 registered shares on average in Q4 2022 divided between 635 Class A shares and 73,001,500 Class B shares. The shareholder structure is presented at investors.sto- rytel.com. Auditor's review This Q1 report has not been reviewed by the auditors of the company. Information about Nasdaq First North Growth Market Nasdaq First North Growth Market (“First North”) is an alternative marketplace operated by the constitu- ent exchanges of Nasdaq Stockholm. It does not have the same legal status as a regulated marketplace. Companies quoted on First North are subject to First North’s rules rather than the legal requirements set for trading on a regulated marketplace. An investment in a company trading on First North implies higher risk than an investment in a listed company. Companies must apply to the exchange and gain approval before trading on First North may commence. A Certified Adviser guides the company through the listing process and ensures that the company continuously satisfies First North’s standards. Information about Nasdaq First North Growth Market. Financial calendar Annual General Meeting 2023 May 4, 2023 Capital Markets Day June 13, 2023 Interim Report January–June 2023 August 1, 2023 Interim Report January–September 2023 October 31, 2023 Year-End Report January–December 2023 February 15, 2024 ===== SIDA 23 ===== 23 Definitions and key ratios including alternative performance measures Net sales Operating main income, invoiced costs, incidental revenue and revenue adjustments. Net sales growth rate, % Net sales for the current year divided by the previous year’s net sales. Net sales growth rate, %, CER Net sales for the current year divided by the previous year’s net sales where the current year’s net sales are calculated at the exchange rates prevailing in the previous year. Gross profit Profit after cost of sales. Gross profit % Operating profit as a percentage of net sales. Gross margin Operating profit as a percentage of net sales. Operating profit (EBIT) Profit before interest and tax. Operating margin (EBIT mar- gin) Operating profit as a percentage of net sales. Profit/loss before taxes Profit after financial income and expenses, before tax. Profit margin (%) Profit after tax as a percentage of net sales. Equity-to-assets ratio (%) Adjusted equity (equity and untaxed reserves less deferred tax, includ- ing non-controlling interests) as a percentage of the balance sheet total. Equity The net assets of the business, i.e., the difference between assets and liabilities, including non-controlling interests. Balance sheet total The company’s total assets. FTE Full-Time Equivalents. Number of employees Average number of employees during the financial year. ARPU Average Revenue Per User (subscriber) per month. Average paying subscribers The average number of paying Storytel subscribers during the quarter. For Family subscriptions, each standard stream (not so-called Kids Mode) is considered one paying subscriber. CER Constant Exchange Rates. EBITDA Earnings before interest, taxes, depreciation and amortization. EBITDA margin EBITDA as percentage of Net Sales. Equity-to-asset ratio Adjusted equity (equity including non-controlling interest and untaxed reserves less deferred tax) as a percentage of the balance sheet total. Revenue – Books (Table 1) Physical books and digital sales through channels other than Storytel. Internal revenue from Storytel has been eliminated. All publishing ===== SIDA 24 ===== 24 houses in the Group, both those located in Sweden and those located internationally, are included. Revenue – Streaming (Table 1) ARPU * Paying Subscribers. Items affecting comparability (IAC) Items affecting comparability include certain items of a significant char- acter that distort comparisons over time. These have been defined as: • Costs in connection with acquisitions • Restructuring costs • Costs related to operationalizing the pause and eventual wind down in Russia ===== SIDA 25 ===== 25 This information is information that Storytel AB (publ) is obliged to make public pursuant to the EU Mar- ket Abuse Regulation. The information was submitted for publication at 8:00 a.m. CEST on May 3, 2023. Stockholm, May 3, 2023 Johannes Larcher CEO ===== SIDA 26 ===== 26 Contacts Storytel AB (publicly traded) • Mailing address: Box 24167, 104 51 Stockholm • Office: Tryckerigatan 4/Norra Riddarholmshamnen 1, 111 28 Stockholm • CIN: 556575-2960 • Email: investorrelations@storytel.com • Website: www.storytel.com, https://investors.storytel.com For more information, please contact: Niklas Alm, Head of Investor Relations Cell: +46 70 824 40 88 Email: niklas.alm@storytel.com Dan Panas, Senior Director Corporate Communications Cell: +46 70 186 52 90 Email: dan.panas@storytel.com