INTERIM REPORTQ1/2015ESA TIHILÄ, CEO

NICLAS ROSENLEW, CFO

APRIL 14, 2015

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INTERIM REPORTQ1/2015

BUSINESS REVIEW

2

KEY EVENTS IN Q1/2015

The Network Services sales grew strongly

The Solution Services sales continued steadily

Building Financing Services business & services has continued

Definitive agreement with Arrowgrass

Acquisition of Procserve in the UK on April 8

Revenue growth at a good level:

“With Basware Discount, as a service on the

Basware Commerce Network, more than one

million businesses will be able to benefit from

early payment terms, managed online in real

time.”

Basware Commerce

Network

The growth in the

transaction volume

continued, up 28.5 percent

year-on-year

3

Q1/2015 KEY FINANCIALS

4

• Net sales EUR 34 041 thousand

(EUR 31 013 thousand), +9.8 %

• Operating profit EUR 1 132 thousand

(EUR 310 thousand), +265.2 %

Net sales

EUR thousand

-

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

Q1 Q2 Q3 Q4

2010 2011 2012 2013 2014 2015

1Q/2015 IN BRIEF: REVENUE GROWTH AT A GOOD LEVEL

Net sales of Network Services grew 38.9 %

year-on-year

Demand for SaaS services at a good level,

SaaS revenue grew 21.5 %

Billable utilization rate continued to develop

positively

Several significant new customer agreements

Revenue growth of 9.8 percent year-on-year:SaaS revenue

SaaS revenue grew by 21.5

percent

5

GROWTH OF TRANSACTION VOLUMES 2010 - Q1/2015

6

-

5,0

10,0

15,0

20,0

25,0

Q1 Q2 Q3 Q4

2010 2011 2012 2013 2014 2015

Million transactions The growth in the

transaction

volume continued,

up 28.5 %

year-on-year,

22.1 million

transactions were

processed via

Basware

Commerce

Network.

SHARE OF RECURRING REVENUE, ROLLING 12 MONTHS AVERAGE

7

The share of

recurring

revenue

of net sales

decreased to

63.7 % (66.9 %)

in Q1/2015

Net sales

Share of

recurring

revenue, rolling

4 quarters

average

0,0 %

10,0 %

20,0 %

30,0 %

40,0 %

50,0 %

60,0 %

70,0 %

80,0 %

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

Q1/

10

Q2/

10

Q3/

10

Q4/

10

Q1/

11

Q2/

11

Q3/

11

Q4/

11

Q1/

12

Q2/

12

Q3/

12

Q4/

12

Q1/

13

Q2/

13

Q3/

13

Q4/

13

Q1/

14

Q2/

14

Q3/

14

Q4/

14

Q1/

15

EUR thousand

SAAS VERSUS LICENSE SALES DYNAMICS

8

License salesSaaS

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

2010 2011 2012 2013 2014 Q1/2015

INTERIM REPORTQ1/2015

FINANCIAL REVIEW

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REPORTING (IFRS)

10

Basware reports one operating segment: Purchase to Pay, P2P. The segment is divided into the Network Services and Solution Services businesses that support each other.

As of 2015, the company reports revenue from products and services as follows: Network Services (e-invoicing solutions and services) and Solution Services (software solutions and services).

Recurring revenue reported by the company consists of the net sales excluding license sales and professional services revenue. Alliance fees related to financing-related value added services of non-recurring nature are not included in the recurring revenue reported.

Basware reports the following geographical areas: Finland, EMEIA & Russia, and Americas & APAC. The reported areas have been adjusted to reflect the growth in the share of the Group's international business. Net sales are reported by the customer’s location, and net sales and operating profit are also reported by the location of the assets.

BASWARE GROUP

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EUR thousand Q1 2015 Q1 2014 YoY growth Q4 2014 QoQ growth

Net sales 34 041 31 013 9.8% 34 664 -1.8 %

Material and services -4 009 -2 978 34.6% -3 559 12.6 %

Personnel expenses -20 811 -20 078 3.7% -20 803 0.0 %

Depreciation and amortization -1 658 -1 789 -7.3% -1 735 -4.5 %

Other operating expenses -6 449 -6 034 6.9% -6 865 -6.1 %

Operating profit (EBIT) 1 132 310 265.2% 1 701 -33.4 %

Net Profit 595 -76 2 204 -73.0 %

EPS, EUR (diluted) 0.04 -0.01 0.11 -63.6 %

Personnel 1516 1 460 3.7% 1 498 1.2 %

0,0

5,0

10,0

15,0

20,0

25,0

30,0

35,0

Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015

Net sales Operating profit

EUR million

NETWORK SERVICES & SOLUTION SERVICES IN Q1/2015

Solution Services (software solutions & services):

EUR 22 928 (23 011) thousand, -0.4%;

SaaS increased, offset by a decline in license sales

Network Services (e-invoicing solutions & services):

EUR 11 112 (8 002) thousand, +38.9 %;

includes EUR 3 million non-recurring alliance fees;

volumes increased by 28.5%

Net sales by business in Q1/2015:

12(25 642, -0.6 %)

4 000

6 000

8 000

10 000

12 000

NETWORK SERVICES

10 000

15 000

20 000

25 000

Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015

SOLUTIONS SERVICESEUR thousand

EXPENSES, FINANCE & INVESTMENTS

Fixed costs including depreciation and

amortization amounted to EUR 28 918 thousand

(27 901), +3.6%

R&D expenses amounted to EUR 4 808 thousand

(4 474), 14.1% of net sales, +7.5%

Capitalized R&D expenses amounted to

EUR 1 692 thousand (844)

The operative cash flow amounted to

EUR 19 775 thousand (13 422)

Cash & cash equivalents including short-term

deposits amounted to EUR 73 624 thousand

Continuing investment activities:

13

Increased cash

position

Cash and equivalents

amounted to

EUR 73 624 thousand

INTERIM REPORTQ1/2015

FUTURE OUTLOOK

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Financing

Services

Software business:

software used within

organisations

• Ranked #1 or #2

globally

• Sold as licenses or

SaaS

• 30+ years of expertise

on Invoice Automation,

Procurement, Travel &

Expense Management

• 2500+ large customers

globally

• 1.2 million users

Financing services:

new value added

innovations

• Expected revenue in

the end of 2015

• Basware Pay, Basware

Discount & upcoming

e-invoicing based,

supplier driven,

invoice financing

service

• Based on Basware

Commerce Network

• Partnerships with

MasterCard,

Arrowgrass, ING

Solution

Services

Network

Services

Solution

Services

Network

Services

BASWARE’S KEY BUSINESS AREAS

E-invoicing business:

operator between

buyers & suppliers

• Also add-on scanning

& supplier activation

services

• 1 million companies in

100 countries

• 80+ million

transactions in

Basware Commerce

Network

Software business:

software used within

organisations

• Ranked #1 or #2

globally

• Sold as licenses or

SaaS

• 30+ years of expertise

on Invoice Automation,

Procurement, Travel &

Expense Management

• 2500+ large customers

globally

• 1.2 million users

Financing services:

new value added

innovations

• Expected revenue in

the end of 2015

• Basware Pay, Basware

Discount & upcoming

e-invoicing based,

supplier driven,

invoice financing

service

• Based on Basware

Commerce Network

• Partnerships with

MasterCard,

Arrowgrass, ING

E-invoicing business:

operator between

buyers & suppliers

• Also add-on scanning

& supplier activation

services

• 1 million companies in

100 countries

• 80+ million

transactions in

Basware Commerce

Network

PROCSERVE IS NOW A BASWARE COMPANY

Basware acquired Procserve, the leading e-procurement solution provider for the public sector in the UK

Acquisition price is ~EUR 25.9 million; the net sales of Procserve ~EUR 9.6 million in 2014

Procserve’s & Basware’s cloud-based e-procurement solutions and networks complement each other

Announcement on April 8, 2015:

“Through the acquisitions over the recent years, Basware is already the leading e-invoicing operator in the Nordics, the Benelux market and Germany, and with the recent acquisition the company significantly strengthens its foothold in the UK”

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BASWARE OUTLOOK

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Basware expects its net sales and operating profit (EBIT) for 2015 to grow compared to 2014:

Strong growth in Network Services by developing & automating the connection of buyers and suppliers to the e-invoicing service, by utilizing digital marketing and sales channels more extensively, and through acquisitions

Sales of Alusta are expected to have a positive effect on software net sales and professional services.

Fixed costs are expected to develop moderately. The company will invest more extensively in sales and marketing as well as research and development of new solutions and services, including Financing Services.

In 2015, the acquisition of Procserve and related integration costs are expected to exceed the savings starting from the second quarter of the year and the cost synergies to be marginally net positive next year. The joint venture which has been established with Arrowgrass Capital Partners LLP is expected to add net costs in 2015.

Active analysis of acquisition targets especially in the e-invoicing market in Europe and in the U.S. will continue.

Investors

www.basware.com/investors

www.basware.com/annualreport

Basware

www.basware.com

www.twitter.com/basware

www.facebook.com/BaswareCorporation

www.linkedin.com/company/basware

Q2 Interim Report on July 10, 2015

NEXT REPORT

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