Sitecore Corporation A/S

Ledelsesberetning
Business reviewThe Sitecore Group (the “Group”) is a software company that predominantly provides customers with Web Content Management (WCM) services through its software. Sitecore Corporation A/S (“Sitecore” or “the Company”) is a legal or economic owner of the Group's legacy and organic Intellectual Property (“IP”), which it distributed through its network of affiliated entities.In connection with the Group company’s operating model:i. Sitecore USA Inc. and Sitecore Ireland Ltd have entered into agreements with Sitecore Corporation A/S to have access to its historic IP in return for a license fee. ii. Sitecore USA Inc. and Sitecore Ireland Ltd have entered into agreements with Sitecore Corporation A/S to reimburse Sitecore Corporation A/S for the research and development (‘R&D’) and Administration services performed by the company.The financial statements of the company also contain financial information from ‘Sitecore France (branch)’.Financial reviewThe Income statement for 2022/23 shows a profit of DKK’000 191,046 (profit of DKK’000 115,250 in 2021/22). The increase in profit of DKK’000 75,796 is primarily due to the following:• Revenue has increased by DKK’000 66,929 (DKK’000 616,872 and 549,943 for 2022/23 and 2021/22 respectively) primarily due to an increase in administrative services performed by the company in 2022/23.• Income from investments in group enterprises has increased by DKK’000 21,226 (DKK’000 25,318 and 4,092 for 2022/23 and 2021/22 respectively, primarily due to a DKK’000 25,318 dividend in 2022/23 from it’s 100% investment in Sitecore Netherlands B.V.• Reversal of impairment of investments in group enterprises has increased by DKK’000 24,127 (DKK’000 24,127 and 0 for 2022/23 and 2021/22 respectively.• The financial performance of 2022/23 exceeds previously disclosed expectations due to the same explanations above on revenue, income from investments and reversal of impairment.At the balance sheet date, 30 June 2023, the company shows equity of DKK’000 2,647,777 (DKK ‘000 2,404,569 in 2021/22). The DKK’000 243,208 increase is equity is primarily due to the following factors:• Profit during the year of DKK’000 191,046 and group share-based payment transactions of DKK’000 52,162 in fiscal year 2023 related to its consolidating parent.Inter-company loans are recognized as either non-current receivables from group enterprises or current receivables from group enterprise depending on maturity dates of loan. To the extent that the related entity has liquidity (see also note 3, Capital matters) and inter-company trade receivables were expected to be collected during the year or paid within twelve months, the prior year receivables from group enterprises have either been repaid or reclassified from non-current to current.Financial risksSitecore Corporation A/S is subject to financial uncertainty and risks driven by external factors such as interest rate, foreign exchange, credit risk and liquidity risk. These risks are managed at a Group level. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group’s financial performance.The financial risks of the Group are managed centrally. The overall risk management guidelines and policies have been approved by the board of directors. The board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, Management's reviewcredit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity. The CFO manages contracts and risk exposures and reports to the board of directors on a regular basis.Research and development activitiesSitecore USA Inc. and Sitecore Ireland Ltd have entered into agreements with Sitecore Corporation A/S to reimburse Sitecore Corporation A/S for the research and development (‘R&D’) activities performed by the company.Events after the balance sheet dateThere were no significant events affecting the Company, which require adjustment to or disclosure in the financial statements.OutlookSitecore Corporation A/S intends to continue providing (i) R&D and administration services to the group along with (ii) access to its legacy and organic IP in return for a license fee from group companies. Excluding the impact of ‘Reversal of impairment of investments’ and ‘Income from investments in group enterprises’ booked in 2022/23, the Company expects profits in 2023/24 will be in line with 2022/23 .