20
2
2
poLight ASA
Annual Report
SHAPING THE
TUNABLE OPTICS
FUTURE
Annual Report 2022
Page 2
Contents
This is poLight .................................................................................................................................................... 3
Message from the CEO ...................................................................................................................................... 6
Board of directors .............................................................................................................................................. 7
Management ..................................................................................................................................................... 8
Investor information .......................................................................................................................................... 9
Board of directors’ report ................................................................................................................................ 12
Corporate governance report .......................................................................................................................... 21
Group financial statements ............................................................................................................................. 30
poLight ASA financial statements .................................................................................................................... 64
Independent auditor’s report .......................................................................................................................... 78
Contact details ................................................................................................................................................. 83
Annual Report 2022
Page 3
THIS IS POLIGHT
to the market for both consumer devices and professional applications. The new lens replicates the lens of
the human eye, enabling new user experiences and easing the implementation of autofocus functions in
various applications.
poLight’s patented, proprietary technology offers considerable benefits, such as extremely fast focus,
compact xy-dimension, no magnetic interference, low power consumption and constant field of view. These
features, and others, open the way for its use in a multitude of as yet unimagined ways.
poLight has employees and long-term consultants in Norway , Finland, France, UK, US, China, Taiwan and the
Philippines. Since the company was founded in 2005, it has acquired world-class expertise in optics, polymers
and MEMS technology. The poLight team comprises highly skilled researchers and technical specialists, all
aiming to develop world-leading tunable optics.
Technology
poLight´s tunable optics technology enables native capabilities that replicate the human eye, making instant
autofocus across a wide focus distance and constant field of view options possible in a variety of camera
systems. It can also bring to life beam steering and optical tilting capabilities. Our technology is differentiated
by its extremely compact size, ultra-low power consumption, super high speed, and high optical
performance, creating a range of new experiences for users and future innovation opportunities for OEM
customers and partners.
Headquarters
Offices and business operations
Horten
Norway
Tampere
Finland
Lyon
France
Shenzhen
China
Taiwan
San Jose, CA
USA
Oxford
UK
Beijing
China
Calamba
Philippines
Instant
focus
Small
real
estate
Constant
field of
view
+
+
Extremely low
power
consumption
+
OEMs
Annual Report 2022
Page 4
Optical matching between the optical elements and the deformable optical materials, combined with
poLight’s anti-reflective coating technology, means that the optical transmittance can be optimized for a
broad range of selected wavelengths from visible to near IR spectrum.
Products
Based on the technology platform the company has developed and patented TLens
– a tuneable optical
Lens. TLens
delivers fast and accurate auto focus compared to standard Voice Coil Motor (VCM) systems,
which require advanced calibration procedures, are subject to magnetic noise and temperature fluctuations
from power consumption and rely on mechanical movement to change focus. poLight’s TLens
technology
eliminates many of these issues while enabling instant auto focus, all-in-focus and constant field of view.
The poLight TLens
is constructed around a piezo element (pzt film), which is placed on a thin glass
membrane and acts as an actuator. A patented polymer is sandwiched between two high-quality glass layers.
The piezo material on the thin glass membrane is designed to spherically deform the polymer when a voltage
is applied to it. This structure offers a tuneable lens of high optical quality. When the piezo is in standby
mode, no force is applied to the thin glass and light passes through the two glass components, and the
polymer, without deviation. When a voltage is applied, the piezo actuator will immediately force the thin
glass membrane to bend accordingly. This generates a perfect lens, and an optical power, which focuses the
light rays. The TLens
can either be used on top of a fixed-focus camera module (i.e. add-on concept) or
integrated as part of the lens stack (i.e. add-in concept).
poLight is in mass production with TLens
Silver and TLens
Silver Premium, as well as the related ASIC driver
(PDA 50), which controls the supply of variable voltage to all TLens
products and makes them change focus.
TLens
Platinum will be the next product to be developed. From an application perspective, the main
difference between the various TLens
products is that they can be used with different sensor formats (size
of the image sensor) due to different aperture sizes (the transparent “opening” in the actuator). The TLens
can be supplied as a “packaged” version to enable quick integration/testing.
The TLens
Silver Premium is considered suitable for both consumer and industrial products, whereas the
TLens
Silver is best suited for industrial applications where optical range is important.
Other products, based on the same technology platform, can potentially be released. TWegde
is an
example, - a product which will improve the resolution for LED display solutions.
Annual Report 2022
Page 5
Supply Chain
poLight is fabless and uses partners for most manufacturing processes, except for the polymer, which is
produced at the company’s headquarters in Norway. STMicroelectronics is poLight´s manufacturing partner
for the MEMS actuator, utilising their thin film piezo technology in an 8-inch semiconductor fabrication plant
in Italy. Polymer and wafers with actuators are shipped to manufacturing partners in the Philippines and
Taiwan, which assemble and test the complete TLens
products and ship them to camera module vendors.
Market
poLight’s TLens technology is suitable for a wide variety of applications, particularly those where there is a
need for compact and high-quality autofocus solutions that benefit from high speed, small size and low power
consumption. Such applications include, but are not limited to, smartwatches, smartphones, augmented
reality (AR) glasses, other wearables/IoT, industrial scanners, readers and sensors, and medical equipment.
Smartphones, wearables and accessories
• Smartphone represent a large
addressable market for which
billions of cameras are
produced each year
• 1.5 billion phones per year with 1
front camera and an average of 3
back cameras
• Potential addressable market for TLens®/poLight
technology estimated at 3 billion units per year
Barcode/Industrial
• Evolving from 1D laser to 2D
imaging barcode readers
• Lasers replaced by camera
systems, where autofocus will
improve efficiency
• Barcode technology is
spreading to new industries
• OEM scan engine vendors today are increasingly
looking to enable machine vision capabilities on
their current offerings
From Gel > MEMS Wafer > TLens® > Camera module > OEM
Camera
Module
Suppliers
OEM´s
Driver ASIC
Bare TLens®
Packaged TLens®
Annual Report 2022
Page 6
MESSAGE FROM THE CEO
“Once again, we had a busy year supporting an increasing number of customer cases and, not least, preparing
for a smartphone project. We have been working hard over many years to qualify for our first smartphone
project. Although we have been close to a market breakthrough several times, last-minute changes in our
customers product release strategy have delayed our entrance into the smartphone market. Finally, we made
it, and this will be our chance to show the world our unique technology and the improved user experiences
it will offer.
The Augmented Reality (AR) market continues to develop very positively for poLight. We are already being
used in the latest Magic Leap AR enterprise glasses, Magic Leap 2
1
, and it has been confirmed that TLens
will be included in several other enterprise AR glasses to be released during 2023. Further we are also
involved in projects aiming to develop AR glasses for the consumer market. The platform we have built over
the last year within the AR segment is impressive. Other market segments such as industrial, medical, and
longer term automotive also adds significant business opportunities future proofing poLight.
So, overall, we have experienced a hectic year, with a lot of encouraging progress. However, there are still
challenges we need to overcome. The organisation is showing an impressive dedication and willingness to
tackle what need to be done and deserves a big vote of thanks! We are looking forward to the coming years!”
Dr Øyvind Isaksen
CEO, poLight ASA
1
https://www.yolegroup.com/technology-insights/the-polight-tlens-piezoelectric-mems-autofocus-module-is-in-the-magic-leap-2/
TLens® customer-wins per March-2023
Enterprise AR
World-facing Camera
Max Pro
Smartwatch
UC W20
HD Webcam
EX 30
2D Barcode
Scan Engine
X30M-E
Machine Vision:
Direct Park Mark Reader
Mi Bunny 4 Pro
Smartwatch
MV-ID2016M-16T
Smart Code Reader
Barcode reader
– assembly line
Smartphone
Selfie Camera
2MP Multi-Focus
MIPI Module
Unnamed
Customer
Annual Report 2022
Page 7
BOARD OF DIRECTORS
Ann
-
Tove Kongsnes
Chair
Ann-Tove Kongsnes is an Investment Director at
Investinor AS. Kongsnes has over her career
gained extensive experience from investments,
development, M&A, IPO’s and exits of technology
companies. Prior to this, she worked for 7 years
with international marketing, and was formerly a
Director of Marketing and Operations. Kongsnes
has extensive board experience, and currently
serves on the boards of 6 of Investinor’s portfolio
companies in addition to 4 Chair/member seats in
Nomination Committees. She holds an MSc in
Economics and Business Administration from HIB
and took the Advanced Program in Corporate
Finance at NHH.
Thomas G
örling
Board member
Thomas Görling is a Senior Investment Director at
Stiftelsen Industrifonden (Sweden) with a
comprehensive involvement in building successful
technology companies. Representing
Industrifonden, he has been engaged in several
portfolio company boards, at present HVR Cardio
Oy (Finland) and eBuilder AB (Sweden). Before
joining Industrifonden in 1998, Mr Görling held
management positions within the European
optical instrument and systems industry. Thomas
holds a Master of Science from the Royal Institute
of Technology in Stockholm and studied business
economics at Stockholm University.
Grethe Viksaas
Board member, Independent
Grethe Viksaas has a long career from the
Northern European managed service provider
Basefarm AS. First as founder and CEO, and later
as executive chair and member of the board of
directors. Prior to Basefarm, Ms Viksaas served
as CEO for SOL System AS and in several
management positions in IT companies. She has
experience from numerous board positions,
including Telenor ASA. She is currently a non-
executive director on the boards of Link
Mobility Group Holding ASA, Crayon Group
Holding ASA and CatalystONE Solutions Holding
AS. She also serves as Chair of the Board in
Farmforce AS. Ms Viksaas has a master's degree
in computer science from the University of Oslo.
Svenn
-
Tore Larsen
Board member, Independent
Mr. Larsen is an Electronic Engineer from the
University of Strathclyde, UK. He was
appointed Chief Executive Officer of Nordic
Semiconductor in February 2002. Mr. Larsen
has broad international experience in the
semiconductor business, previously as Director
for the Nordic region for Xilinx Inc. He has also
been working at Philips Semiconductor.
Dr Juha Alakarhu
Board member, Independent
Juha Alakarhu is the VP of Imaging at Axon in
Tampere, Finland. He runs the Axon R&D office
in Finland and is responsible for the imaging
system for Axon camera products. Dr
Alakarhu’s entire career has been devoted to
developing cameras. Before joining Axon in
2018, he worked for Nokia and Microsoft,
where he developed several pioneering camera
solutions, such as oversampling (the 41-
megapixel camera), optical image stabiliser,
and virtual reality technology. Juha Alakarhu
holds a PhD from Tampere University of
Technology.
Annual Report 2022
Page 8
MANAGEMENT
Dr Øyvind Isaksen
Chief Executive Officer
Øyvind Isaksen has been CEO of poLight since
August 2014. He has previously held several
CEO positions, most recently in the publicly
listed company Q-Free ASA, which he left in
January 2014, after 7 years as CEO. Øyvind
Isaksen holds a PhD in Applied Physics.
Pierre Craen
Chief Technology Officer
Pierre Craen has more than 20 years’ experience
in opto-mechanical systems engineering. Prior to
joining poLight, he managed product development
teams at Varioptic, Barco and Motorola/Symbol.
Mr Craen holds an MSc in Optical Engineering
from Sup-Optic, as well as an MSc in Applied
Physics.
Alf Henning Bekkevik
Chief Financial Officer
Alf Henning Bekkevik has a background from
Arthur Andersen (E&Y), Wallendahl, Fjord
Line, Grenland Group, and, most recently, as
VP Finance for Wood Group Norway AS. He
holds a master’s degree in business &
economics (Siviløkonom) from NHH, and is a
certified public accountant.
Marianne Sandal
Chief Operating Officer
Marianne Sandal has more than 15 years’
experience heading worldwide operations in
Nera ASA (telecommunications) and Q-Free ASA
(intelligent transportation systems). Ms Sandal
holds a BSc in Mechanical Engineering, in addition
to courses in economics and management from
BI Norwegian School of Management.
Annual Report 2022
Page 9
INVESTOR INFORMATION
Share price development
poLight ASA (PLT) has one class of shares. Its shares were listed on the Oslo Stock Exchange on 1 October
2018 at NOK 50 per share (NOK 10 after share split). The company had 51,982,700 shares outstanding at the
close of 2022, each with a nominal value of NOK 0.04. 30 May 2022 the PLT share was split in the ratio of 1:5
which means every single share before the split was turned into 5 shares after the split.
In 2022, the Group’s share price declined from NOK 186.40 per share (NOK 37.28 after share split) at the
beginning of the year to NOK 18.50 at close. During the year, the share price varied between NOK 17.10 and
NOK 38.80 per share. In total, 21,520,990 shares were traded in 2022 (share split adjusted volume),
equivalent to 41% of the shares outstanding.
Major shareholders and voting rights
poLight had 6,337 shareholders registered in the Norwegian Central Securities Depository (VPS) as at 31
December 2022. The 20 largest shareholders owned shares representing 50.6% of the share capital. Non-
Norwegian shareholders owned 22.5% of the shares. All the shares registered by name carry equal voting
rights. The shares are freely tradable.
0
200
400
600
800
1 000
1 200
1 400
0
5
10
15
20
25
30
35
40
45
Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22
PLT OSEBX
OSEBX
PLT
Annual Report 2022
Page 10
poLight shareholders as at 31 December 2022
Ordinary
shares
Share-
holding
Voting
rights
%
%
Investinor Direkte AS 8 899 290
17,1 %
17,1 %
Stiftelsen Industrifonden 5 244 125
10,1 %
10,1 %
Nordnet Bank AB (nominee)
2 408 642
4,6 %
4,6 %
Nordnet Livsforsikring AS
2 156 769
4,2 %
4,2 %
Deutsche Bank Aktiengesellschaft (nominee)
1 950 930
3,8 %
3,8 %
VPF Nordea Avkastning
778 075
1,5 %
1,5 %
VPF Pareto Investment
628 000
1,2 %
1,2 %
VPF Nordea Kapital
506 222
1,0 %
1,0 %
Danske Bank A/S (nominee)
392 754
0,8 %
0,8 %
VPF Nordea Norge Plus 362 535
0,7 %
0,7 %
Stefan Sveen 338 000
0,7 %
0,7 %
Saxo Bank A/S (nominee) 325 465
0,6 %
0,6 %
LHH AS 310 000
0,6 %
0,6 %
Kjell Mossefin 307 500
0,6 %
0,6 %
Asbjørn John Buanes 307 465
0,6 %
0,6 %
Erik Schellhorn 305 497
0,6 %
0,6 %
Trond Andersen 297 315
0,6 %
0,6 %
Fjellstuens Eftf. AS 296 285
0,6 %
0,6 %
Li Zhang 255 884
0,5 %
0,5 %
Åge Sverre Heggheim 222 000
0,4 %
0,4 %
Total number of shares owned by top 20 shareholders 26 292 753
50,6 %
50,6 %
Number of shares owned by other shareholders 25 659 947
49,4 %
49,4 %
Total number of shares
51 952 700
100,0 %
100,0 %
An overview of the 20 largest shareholders is available on the poLight website, updated each week.
Employee share programme
The Board is authorised to issue shares through share option schemes up to a total nominal value of NOK
207,717, equal to 5,192,925 shares. In 2022, 27,220 shares (share split adjusted volume) were issued in order
to fulfil the obligation to provide shares following the exercise of share options. As at 31 December, 3,275,312
share options (equal to 8.2% of shares outstanding) were outstanding, all at a weighted average strike price
of NOK 12.9 per share.
Corporate actions/events Date
LLVISION confirm releasing enterprise Augmented Reality glasses using TLens® 04.04.2023
Customer announcement of release of a new flagship smartphone using TLens® 30.03.2023
Contemplated underwritten rights issue - notice of extraordinary general meeting 20.03.2023
Design-win award and PO received for smartphone 24.01.2023
Design-in award and PO received for samples for an Augmented Reality (AR) case 15.03.2022
Ex. date share split 1:5
30.05.2022
Capital Markets Day 2022
01.06.2022
Awarded another barcode design-win for industrial applications
07
.0
6
.202
2
Proof-of-Concept agreement with a top tier medical customer
27.06.2022
Annual Report 2022
Page 11
Follow-on order from an Augmented Reality customer
16.08.2022
Dividends and dividend policy
poLight is focused on developing and commercialising its technology and intends to retain any future
earnings in the foreseeable future to finance development activities, operations and business growth. The
company has not previously distributed any dividends to its shareholders and does not expect to do so in the
foreseeable future. Any future decision to pay a dividend will depend on the company's financial position,
operating profit and capital requirements.
Analyst coverage
poLight does not currently have analyst coverage. Any changes will be updated on the company’s website
www.polight.com.
Financial calendar 2023
Date Event
2
8
February
202
3
Quarterly Report
–
Q4
202
2
28 April 2023 Annual report 2022
11 May 2023 Quarterly Report – Q1 2023
2
4
May
202
3
Annual General Meeting
17 August 2023 Half-yearly Report 2023
02 November 2023 Quarterly Report – Q3 2023
27
February
202
4
Quarterly Report
–
Q4
202
3
Further information can be found on the company’s website www.polight.com and at www.newsweb.no.
poLight’s IR policy can be found at www.polight.com.
Annual Report 2022
Page 12
BOARD OF DIRECTORS’ REPORT
Overall progress in 2022 has been encouraging. poLight´s TLens
is now used in eleven products,
representing both consumer and professional applications, confirming the versatility and market potential
of poLight’s unique technology. There was a high level of activity related to smartphone and augmented
reality (AR) throughout the year, which has led to design-win in both very strategically important market
segments.
Corporate events in 2022
At the AGM held on 25 May 2022, Grethe Viksaas was elected as the Board’s chair for the remaining year,
replacing Ann-Tove Kongsnes. Ann-Tove Kongsnes was re-elected for another two years.
The AGM also appointed Jan-Erik Hæreid and Anne E.H. Worsøe for another two years as members of the
company’s Nomination Committee.
On 17 February 2022, Grethe Viksaas became the chair of the Audit Committee, replacing Ann-Tove Kongsnes
due to corporate governance recommendations, since Ann-Tove Kongsnes was the chair of the Board. After
the annual general meeting Ann-Tove Kongsnes was 15 June 2022 appointed as the chair of the Audit
Committee, since Grethe Viksaas was elected as the chair of the Board.
Manufacturing and operations
poLight works primarily with two categories of subcontractors – a MEMS/wafer supplier (ST Microelectronics
(ST) in Italy) and assembly partners. While ST produces the wafers/actuators, assembly partners assemble
the complete product. The polymer (i.e. lens material) is produced at poLight’s headquarters.
With regard to assembly and testing, the focus during the year has been on yield-improvement, improved
final test setup (both in terms of quality and capacity) and securing supplies for existing and new customer
projects. More work and higher production volumes over time will be needed to achieve our targeted yield
numbers. In that respect started delivering to smartphone project is a very good opportunity to improve the
Annual Report 2022
Page 13
manufacturing process and yield. The prospect of achieving an acceptable yield has been confirmed by the
production carried out over the past few quarters.
ST is currently manufacturing a significant backlog of wafers ordered by poLight, which is scheduled to cleared
in the first half of 2023. Important changes to the wafers, improving the optical performance of the TLens
,
is now phased in.
Lead-time and capacity constraints in the industry remain challenging. This has required poLight to make
material and capacity commitments well in advance of customer orders, leading to the build-up of wafer
inventory.
Product development
Important improvement projects relating to the performance and reliability of existing products (TLens
)
continued during the quarter. Some aspects will be implemented in the short term, while others have a
longer-term horizon. With regard to new products/functionality, main focus has been on TWedge
, a
potential new product that enables wobulation, a method for improving resolution in AR projection display
solutions. In mid-2023 technical samples will be available. Customer interactions so far indicate that this may
become a very important product. poLight seeks to establish early customer engagement in the development
of this new product.
Market
Customer-related activities continued at a good level during the year. poLight is actively engaged in several
market areas. This includes consumer market, such as for smartphones, augmented reality devices and
accessories, as well as a broad range of professional applications, such as barcode readers, medical devices
and augmented reality glasses. Recent developments in the automotive market indicate a future need for
autofocus solutions, and TLens
has been mentioned as a potential candidate. This market is demanding,
and it will take a long time to qualify for such applications. Nevertheless, it is worthwhile exploring since the
volume potential is significant.
Interest in our solutions remains high and the company continues to make progress on several projects with
potential customers. In sum, TLens
technology is increasingly being recognised by potential customers in a
wide range of market areas. Over time, this is expected to develop into a diversified revenue base for poLight.
Consumer market
The new camera module concept, based on add-in TLens
design, is continuing to open up new opportunities
for different applications. Several reference designs have been developed to position TLens
for various use
cases. During the year, the focus was on smartphone and augmented reality applications. Other applications,
such as webcams, drones, etc., are also being explored.
poLight has been exploring the smartphone market for many years and been close to a market breakthrough
several times. However, last-minute changes in customer product release strategy have delayed poLight´s
entrance into the smartphone market. After the close of the fourth quarter 2022, the company announced a
design-win and mass production purchase order for a flagship phone to be announced during the first half
year 2023. The volume is expected to be low, as it is a flagship phone. Customer interaction is encouraging,
and they have expressed a strong motivation and interest in continuing to work with poLight.
Annual Report 2022
Page 14
At present, poLight has achieved four design-wins, three design-in´s (two related to AR) and is involved in six
ongoing PoC projects relating to the consumer market. Two of the ongoing PoCs are consumer-oriented
augmented reality cases.
Augmented Reality (AR) market
TLens
is being considered/tested by several important AR/VR market players. The TLens® technology’s low
power-consumption, no gravity sensitivity, temperature stabilisation (often called athermalisation), high
speed and compactness stand out as key technical benefits.
The company is currently included in one product already released to market – Magic Leap 2
1
. In addition,
six design-ins have been confirmed (two of which are for consumer applications) while four PoCs (two of
which are for consumer applications) are ongoing. Good progress was achieved in most cases during the year.
Vuzix, XVisio and LLVision are three of the design-ins mentioned above. They are expected to be launched
onto the market around mid 2023. In addition, one more is expected to be launched onto the market towards
end of the year.
To date, the use case for TLens® has mainly related to world-facing cameras. However, the company is also
involved in various AR display applications based on both TLens
and TWedge
.
The AR market is entering a very important phase, and poLight expects to see several companies releasing
new AR products in the coming years. Most of the initial customer cases relate to the professional/business
market, so initial volumes will be low. Over time, however, AR devices are expected to address the consumer
market, prompting a significant increase in demand some years down the road. In the longer term, the AR
market is expected to be an important market for the company.
Industrial market
The opportunity pipeline for this market segment is quite promising and slowly growing. It will take time to
develop this market and will require entry into some broader application areas. In addition to barcode
applications, the company is involved in various other industrial applications.
In the end of 2022, the company has achieved five design-wins and has fifteen ongoing PoCs (13 of which are
for barcode/machine vision applications). The Teledyne e2v product, “2MP Multi-Focus MIPI Module”, is the
latest design-win.
Medical/Research
The company is continuing to support selected opportunities in this market segment. Most of the cases being
explored are based on “incoming calls”. Over time, this sector could potentially become an important market
for poLight.
At the end of the year, the company was engaged in one design-win (Kavli, research), one design-in, and 15
ongoing PoCs.
The design-in relates to the announcements made on 20 August and 21 September 2021 regarding a
disposable laparoscope being developed by Xenocor (https://xenocor.com). Development is now at an
advanced stage. Human trials are expected to be carried out in the second quarter, with expected market
release in mid-2023.
Annual Report 2022
Page 15
The Kavli design-win has generated a lot of activity, and similar research cases account for several of the
company’s ongoing PoCs. The main purpose of this activity is brand-building and providing support for
important research. The other ongoing PoCs relate to business enterprises wishing to explore the use of
TLens
in commercial products.
Sustainability
poLight aims to be a responsible company with regard to working conditions, human rights, the environment
and anti-corruption efforts. The company promotes a healthy, safe and fair working environment in
accordance with applicable laws and regulations, including the UN Global Compact. poLight has established
a code of conduct as an initial step in developing formal guidelines, principles, procedures and standards
related to corporate social responsibility. poLight is not regulated by any environmental permits or regulatory
mandates.
Management carries out an annual ESG (environmental, social and governance) assessment, including a risk
assessment, which is subject to evaluation by poLight ASA’s Board of Directors. The top three risks that are
of importance to both stakeholders and poLight are:
1. Quality risks – customer satisfaction
To ensure quality in customer deliveries, poLight makes significant efforts to support the customer in the
integration of the TLens
as well as thoroughly testing of the products before shipping.
2. Competence risks – employee attraction
Research, development and manufacturing of TLens
technology requires a high level of competence.
To retain and attract new employees in an organic growth phase, it is therefore extremely important for
poLight to be perceived as an exciting and competitive employer.
3. Supply chain risks
poLight places great emphasis on qualifying and carrying out continuous improvement processes
together with manufacturing partners to ensure the quality, cost efficiency and robustness of the supply
chain. While managing supply chain partners in general is demanding, it is particularly complex when
preparing for various ramp-up scenarios in today’s challenging global supply chain situation.
The company is increasingly aware of its role in contributing to the UN Sustainable Development Goals. As
an example, poLight’s products are already in use in medical scientific equipment and hence contributes to
important research benefitting the greater society. From a business perspective this is not short- or medium-
term key for the company, but important to support for other reasons mentioned above. Also, poLight´s
technology might be used in compact surgical devices making surgical procedure safer and more efficient.
Organisation
poLight had 11 full-time employees and two part-time employee at the close of 2022, compared to 12 full-
time and no part-time employees in 2021. In addition, 12 consultants were engaged on long-term contracts,
compared with ten in 2020. The employees and consultants were located in eight different countries and
represented 13 different nationalities. Women made up 25% of the workforce, compared with 22% in 2021.
poLight is committed to being a healthy workplace, which provides equal opportunities for development to
all employees, irrespective of gender, ethnicity or other characteristics.
poLight’s code of conduct states that: “poLight expects dedicated employees, who treat others with respect
and maintain open communications. There shall be no discrimination or harassment on the grounds of age,
gender, disabilities, race, sexual orientation, ethnic origin, religion or political affiliation. poLight shall be an
Annual Report 2022
Page 16
attractive workplace with an inclusive working environment. poLight expects its employees not to act in ways
that could harm the poLight brand. When we are working in cultures other than our own, we treat everyone
– individuals as well as organisations – with respect, and act in accordance with national laws and regulations.
We also pay attention to local etiquette and values in the countries where we are working. In meetings with
contacts outside poLight, we behave with professionalism and courtesy. poLight supports and respects
internationally recognised human rights, including those set out in the International Labour Organization’s
conventions. The company respects the right to freedom of association and opposes any form of
child labour, forced labour or discrimination, and requests all representatives and suppliers to abide by the
same principles. All employees, partners, etc., are made aware of these guidelines.”
poLight is committed to the health, safety and welfare of its employees and their families, and its customers.
Sickness absence came to 1.1% in 2022, compared with 0.7% in 2021. Sickness absence remains well below
the Norwegian national average of approximately 6.8% (2021: 6.4%). No work-related accidents caused
personal injuries or material damage in 2022.
Liability insurance
Members of poLight ASA’s Board and management are covered by directors and officers liability insurance
provided by AIG. The insurance also includes poLight’s subsidiaries. The Board considers the coverage to be
reasonable.
Financial development, poLight Group
The Group’s consolidated revenue in 2022 totalled NOK 13.4 million, compared with NOK 10.0 million in
2021. NOK 10.0 million (2021: NOK 8.7 million) reflects sales of TLens
©
and ASICs for commercial use and
sample deliveries, and NOK 3.3 million (2021: 1.4 million) reflects revenue from NRE “non-recurring
engineering” relating to customer development projects.
Cost of sales totalled NOK 4.8 million in 2022, compared with NOK 3.9 million in 2021.
R&D expenses, net of government grants, amounted to NOK 32.9 million, up from NOK 25.4 million in 2021.
Increased internal resources contributed to the increased expenditure, however the most significant
contributor was lower extent of government grants (see Note 14 Government grants for details). No
development expenditures have been capitalised in the past two years. Expensed R&D costs include R&D
management, patents, improvements of the existing TLens, feasibility study of new concepts, and costs
related to integration of TLens in new customer applications/products.
Sales and marketing expenses totalled NOK 13.1 million, up from NOK 7.2 million in 2021, mainly due to
increased sales activities. Operational/supply chain expenses totalled NOK 9.2 million, up from NOK 9.1
million in 2021.
Administrative expenses totalled NOK 12.1 million, up from NOK 6.9 million in 2021. As a result of the positive
outcome of the VAT appeal, NOK 12 million was recognised as a cost reduction in 2021.
Depreciation and amortisation amounted to NOK 10.4 million, down from NOK 11.9 million in 2021.
The Group made an operating loss of NOK 69.1 million in 2022, compared with an operating loss of NOK 54.3
million in 2021.
Annual Report 2022
Page 17
Net financial items in 2022 totalled NOK 1.5 million, up from NOK 0.9 million in 2021. This is attributable
primarily to interest on bank deposits. The tax expense in 2022 came to NOK 0.2 million, compared with NOK
0.1 million the year before.
The Group made a net loss of NOK 67.9 million in 2022, compared with a net loss of NOK 53.5 million in 2021.
This represents a loss in 2022 of NOK 1.31 per share on a fully-diluted basis, compared with a loss of NOK
1.13 per share in 2021.
Financial position
As at 31 December 2022, total assets came to NOK 178.2 million, compared with NOK 238.7 million at year-
end 2021. Total equity came to NOK 150.7 million, compared with NOK 213.4 million at year-end 2021.
Intangible assets amounted to NOK 24.9 million as at 31 December 2022, compared with NOK 33.4 million at
the close of 2021, reflecting amortisation over the year.
During the year, inventories increased by NOK 28.8 million to NOK 45.6 million at the close of 2022 (NOK 16.8
at year-end 2021). The increase in inventories mainly relates to wafers from ST Microelectronics and a higher
number of finished assembled units. The inventory build-up of components with long lead-times (e.g. wafers)
will improve readiness for potential volume customers.
Trade and other receivables totalled NOK 8.4 million (NOK 22.1 million in 2021 including VAT claim
receivables), hereof recognised government grants of NOK 4.6 million (NOK 7.3 million in 2021).
As at 31 December 2022, the company had cash and cash equivalents of NOK 84.2 million, compared with
NOK 157.8 million at the close of 2021. The change was mainly a function of liquidity consumed by operating
activities and inventory build-up.
Long-term liabilities totalled NOK 3.0 million at year-end 2022 (NOK 3.9 million in 2021) that is related to the
lease of the company’s headquarters in Horten, which was signed in the second quarter 2021. Total current
liabilities at year-end 2022 totalled NOK 24.6 million (NOK 21.3 million in 2021).
Cash flow
Net cash flow used in operating activities totalled NOK 63.6 million in 2022, compared with NOK 49.5 million
in 2021. The increase is attributable to the inventory build-up of NOK 28.7 million.
Net cash flow used in investing activities totalled NOK 9.2 million in 2022, compared with NOK 2.1 million
used in 2021. The increase is primarily due to investments of NOK 5.5 million in additional final test
equipment in both Taiwan and the Philippines. The equipment includes sorting features with respect to
various performance parameters.
Net cash flow used in financing activities totalled NOK 0.7 million in 2022. The positive cash flow from
financing activities in 2021 of NOK 132.3 million reflects the net proceeds from the share issues, which raised
NOK 130.3 million in net proceeds.
Financial development, parent company
In 2022, the parent company generated NOK 13.4 million in gross revenue, compared with NOK 10.0 million
the year before. It made an operating loss of NOK 71.3 million in 2022, after total operating expenses of NOK
Annual Report 2022
Page 18
79.8 million. In 2021, the parent company made a loss of NOK 55.9 million, after total operating expenses of
NOK 62.1 million.
Operating expenses in 2022 include employee expenses (including consultants engaged on long-term
contracts) of NOK 36.6 million, compared with NOK 38.4 million in the preceding year. The parent company
had on average 26 employees and consultants in 2022, compared with 19 in 2021. In 2022, other operating
expenses amounted to NOK 33.9 million, compared with NOK 12.9 million in 2021. (See Note 3 Specification
of operating expenses by nature).
poLight ASA made a net loss of NOK 68.6 million in 2022, compared with a loss of NOK 54.2 million in 2021.
The Board proposes that NOK 63.8 million be transferred from the share premium and NOK 4.8 million from
retained earnings. The Board does not propose payment of a dividend for 2022.
Share capital
As at 31 December 2022, poLight ASA had a share capital of NOK 2.1 million, consisting of 51,952,700 shares,
with a nominal value of NOK 0.04 each.
poLight employees have been granted options to subscribe for shares under share options schemes. The
Board is authorised to issue shares – in share option schemes – up to a total nominal value of NOK 207,717
(5,192,925 shares at a nominal value of NOK 0.04). As at 31 December, 4,238,645 share options (equal to
8.16% of shares outstanding) have been granted, all at a weighted average strike price of NOK 12.9 per share
with a range from NOK 3.78 to NOK 22.8. 220 000 share options have been granted during the year at strike
price of NOK 21 per share. 3,275,312 share options where exercisable at 31. December.
Risks and risk management
poLight’s risk management is based on the principle that risk assessment is an integral part of all business
activities. Reference is also made to the ESG risk assessment described in Sustainability chapter. As a
technology company with global operations, poLight is exposed to risk factors of a financial and operational
nature, which may affect business activities and the company’s financial position. poLight’s Board places a
high priority on managing risk and has established routines and policies to limit overall risk exposure.
Market risk: poLight develops highly innovative autofocus lenses for consumer and industrial products. The
markets for these products are undergoing rapid technological changes. poLight’s future success will depend
on the company’s ability to meet changing industry demands, develop new technologies that address
prospective customers’ increasingly sophisticated requirements, and ensure high-quality and cost-effective
mass production.
IPR-related risk: To protect the poLight’s intellectual property rights (IPR), poLight relies on a combination of
patents, copyright and trademark laws, trade secrets, confidentiality procedures and contractual provisions.
IPR constitutes one of poLight’s key assets and poLight actively seeks to protect its products and technologies
in the markets and geographic regions where it operates, and elsewhere as deemed relevant. In its use of
IPR, poLight faces several risks. For example, third parties may illegally copy or utilize the poLight’s IPR, third
parties may (with or without merit) claim that the poLight’s use of IPR infringes the IPR of that third party, or
the IPR of others may limit the poLight’s freedom to operate.
Annual Report 2022
Page 19
Foreign exchange risk: poLight is subject to certain financial risks associated with currency and interest rates.
While the company has had limited revenue so far, it does incur costs in various currencies. No single large
currency risk that could have a significant impact on the company’s net profit has been identified. Proceeds
from share issues are kept in NOK. poLight has not entered into any hedging agreements.
Liquidity risk: poLight currently operates at a loss. For the next 12 months, the Group's principal source of
liquidity will still be cash generated from financing, equity and debt, in addition to net cash flows generated
from sales. In April 2023 the company carried out an underwritten rights issue which raised NOK 100 million
in net proceeds. However, the company may in the future seek to raise further capital to finance R&D
activities and expansion plans.
Corporate governance
poLight aims to comply with the Code of Practice for Corporate Governance published by the Norwegian
Corporate Governance Board (NUES). A separate section of this annual report provides further details of the
poLight Group’s corporate governance.
Going concern and events in 2022
The risk factors associated with the Covid-19 pandemic relate to the supply chain. Difficulties in moving
employees/competence between Europe and Asia have been reduced after the lifting of many travel
restrictions. However, the implications of earlier Covid restrictions have significantly reduced spending and
impacted various OEMs’ sales volumes and consequently reduced demand from suppliers.
The current tensions between China and Taiwan could potentially have a negative impact on the company´s
operations. However, the company’s main TLens
©
assembly activities has been moved to the Philippines, and
only the final test is carried out in Taiwan. A similar capability is being established in the Philippines, which
will reduce the risk further.
Since poLight does not have any operations, customers or direct suppliers in Russia or Ukraine, the war in
Ukraine has, to date, not had any direct consequences of significance for the Group’s operations, other than
the general impact of the war on the global situation.
For the next 12 months, the Group's principal source of liquidity will still be cash generated from financing,
equity and/or debt, in addition to net cash flows generated from sales. Management and the Board of
Directors are continuously evaluating the Group’s liquidity requirements and in April 2023 poLight carried
out an underwritten rights issue which raised NOK 100 million in net proceeds.
Accordingly, these consolidated financial statements have been prepared under the assumption that both
the Group and the parent company are going concerns, and management confirms that this is an appropriate
assumption.
Outlook
The company’s high activity levels are reflected in a growing pipeline.
The company has been, and is still, using substantial resources to position itself for the smartphone market
and recently announced a design-win and first mass production purchase order. This is an important
milestone for the company. Smartphones undoubtedly represent the most important volume market. The
announced project relates to a flagship smartphone, and will hence be a low volume case. Nevertheless, it
Annual Report 2022
Page 20
will represent a key reference for the company in all market segments. The customer behind the announced
design-win is expressing interest in using TLens
also for future products.
The Augmented Reality (AR) market continues to develop very positively for poLight. We are already being
used in the latest Magic Leap AR enterprise glasses, Magic Leap 2, and it has been confirmed that TLens
will
be included in several other enterprise AR glasses to be released during 2023. Further the company is also
involved in projects aiming to develop AR glasses for the consumer market. The platform poLight have built
over the last year within the AR segment is impressive. Other market segments such as industrial, medical,
and longer term automotive also adds significant business opportunities future proofing poLight.
In April 2023 poLight successfully carried out an underwritten rights issue which raised NOK 100 million in
net proceeds to finance the Group’s growth plan. The share issue was oversubscribed by…..
Statement by the Board of Directors and the CEO
We confirm that, to the best of our knowledge, the consolidated financial statements for 2022 have been
prepared in accordance with IFRS, as adopted by the EU, as well as additional disclosure requirements set
out in the Norwegian Accounting Act; and that the financial statements for the parent company for 2022
have been prepared in accordance with the Norwegian Accounting Act and generally accepted accounting
practice in Norway; and that the information presented in the financial statements provides a true and fair
view of the parent company and the Group’s assets, liabilities, financial position and results for the period as
a whole; and that the Board of Directors’ report provides a true and fair view of the development,
performance and financial position of the parent company and the Group, and includes a description of the
material risks that the Board of Directors, at the time of writing this report, considers could have a significant
impact on the financial performance of the Group.
poLight ASA
Horten, 28 April 2023
Grethe Viksaas (sign)
Chair, Independent
Ann-Tove Kongsnes (sign)
Deputy chair
Thomas Görling (sign)
Board member
Svenn-Tore Larsen (sign)
Board member, Independent
Juha Alakarhu (sign)
Board member, Independent
Øyvind Isaksen (sign)
Chief Executive Officer
Annual Report 2022
Page 21
ENVIRONMENT, SOCIAL AND GOVERNANCE REPORT (ESG)
1. Introduction
poLight ASA was founded in 2005 and is a publicly-traded company (OSE: PLT) that offers a patented,
proprietary tunable optics technology, starting with its first product TLens®, which replicates “the human
eye” experience in autofocus cameras in devices such as smartphones, augmented reality glasses,
smartwatches, barcode scanners, machine vision systems and medical devices. poLight’s TLens® enables
better system performance and new user experiences due to differentiated advantages such as fastest
focus, smallest size, ultra-low power consumption, no magnetic interference, no gravity sensitivity, and
constant field of view.
poLight® has built a world-class team with expertise in optics, polymers, MEMS technology, imaging
applications and camera systems. This team is establishing poLight® as the world leader in tunable optics.
poLight® is a fabless company using MEMS foundry, assembly, and packaging services from well-established
suppliers. poLight® is headquartered in Horten, Norway, with employees in Finland, France, China, Taiwan,
US, UK, and Philippines.
2. Sustainability
poLight aims to be a responsible company with regard to working conditions, human rights, the environment
and anti-corruption efforts. The company promotes a healthy, safe and fair working environment in
accordance with applicable laws and regulations, including the UN Global Compact. poLight has established
a code of conduct as an initial step in developing formal guidelines, principles, procedures and standards
related to corporate social responsibility. poLight is not regulated by any environmental permits or regulatory
mandates.
Sustainability Statement
We create sustainable technology
We are committed to creating cutting-edge technology for a sustainable world and doing so in a sustainable
way. We will offer innovative products that remain highly efficient throughout their service life and support
a sustainable energy supply. Every technology we develop will be socially responsible and sustainable to
preserve a liveable environment.
We prioritize people
People are our biggest asset. We work proactively to ensure employee health, respect, safety and well-being
while maintaining a diverse, and participation-based corporate culture that establishes optimum conditions
for the sustainable commitment of our employees. We believe diversity enables innovation, stakeholder
engagement and supports growth.
We protect the planet
We commit to protecting the environment by mitigating the impact of our activities and minimizing our
footprint, thereby delivering our products and services in a way that minimizes their environmental impact.
All of our operations, processes, business practices and entire value chain will be firmly anchored in
sustainability principles. We are committed to achieving carbon neutrality and reducing all greenhouse gas
emissions in our operations, while also striving for zero waste.
Annual Report 2022
Page 22
We generate long-term value for all stakeholders
We believe we have an important role to play in sustainability and that we are stronger if we act collectively.
We are committed to collaborating with suppliers who share our values and to working locally to improve
the social, economic and environmental well-being of the communities where we operate.
3. ESG risk assessment
Management carries out an annual ESG (environmental, social and governance) assessment, including a risk
assessment, which is subject to evaluation by poLight ASA’s Board of Directors. The top three risks that are
of importance to both stakeholders and poLight are:
1. Quality risks – customer satisfaction
To ensure quality in customer deliveries, poLight makes significant efforts to support the customer in the
integration of the TLens
as well as thoroughly testing of the products before shipping.
2. Supply chain risks
poLight places great emphasis on qualifying and carrying out continuous improvement processes
together with manufacturing partners to ensure the quality, cost efficiency and robustness of the supply
chain. While managing supply chain partners in general is demanding, it is particularly complex when
preparing for various ramp-up scenarios in today’s challenging global supply chain situation.
3. Business ethics
poLight has high focus on anti-corruption efforts. Business associates have to apply to poLight’s code of
conduct with
The company is increasingly aware of its role in contributing to the UN Sustainable Development Goals. As
an example, poLight’s products are already in use in medical scientific equipment and hence contributes to
important research benefitting the greater society. From a business perspective this is not short- or medium-
term key for the company, but important to support for other reasons mentioned above. Also, poLight´s
technology might be used in compact surgical devices making surgical procedure safer and more efficient.
4. Environmental
poLight is still in an early phase commercially with low volume production.
Annual Report 2022
Page 23
Annual Report 2022
Page 24
Organisation
poLight had 11 full-time employees and two part-time employee at the close of 2022, compared to 12 full-
time and no part-time employees in 2021. In addition, 12 consultants were engaged on long-term contracts,
compared with ten in 2020. The employees and consultants were located in eight different countries and
represented 13 different nationalities. Women made up 25% of the workforce, compared with 22% in 2021.
poLight is committed to being a healthy workplace, which provides equal opportunities for development to
all employees, irrespective of gender, ethnicity or other characteristics.
poLight’s code of conduct states that: “poLight expects dedicated employees, who treat others with respect
and maintain open communications. There shall be no discrimination or harassment on the grounds of age,
gender, disabilities, race, sexual orientation, ethnic origin, religion or political affiliation. poLight shall be an
attractive workplace with an inclusive working environment. poLight expects its employees not to act in ways
that could harm the poLight brand. When we are working in cultures other than our own, we treat everyone
– individuals as well as organisations – with respect, and act in accordance with national laws and regulations.
We also pay attention to local etiquette and values in the countries where we are working. In meetings with
contacts outside poLight, we behave with professionalism and courtesy. poLight supports and respects
internationally recognised human rights, including those set out in the International Labour Organization’s
conventions. The company respects the right to freedom of association and opposes any form of
child labour, forced labour or discrimination, and requests all representatives and suppliers to abide by the
same principles. All employees, partners, etc., are made aware of these guidelines.”
poLight is committed to the health, safety and welfare of its employees and their families, and its customers.
Sickness absence came to 1.1% in 2022, compared with 0.7% in 2021. Sickness absence remains well below
the Norwegian national average of approximately 6.8% (2021: 6.4%). No work-related accidents caused
personal injuries or material damage in 2022.
Annual Report 2022
Page 25
CORPORATE GOVERNANCE REPORT
5. Governance principles and objectives
poLight ASA (“poLight” or the “company”) seeks to create sustained shareholder value and pays due respect
to the company’s various stakeholders. These include its shareholders, employees, business partners, society
in general and the public authorities. poLight is committed to maintaining a high standard of corporate
governance and has established principles and guidelines that define the roles and relationship between the
shareholders, the Board of Directors (the “Board”) and the company’s executive management
(“management”).
poLight is incorporated and registered in Norway and subject to Norwegian law. The company’s shares are
listed on the Oslo Stock Exchange. As an issuer of shares, the company must comply with rules applicable to
companies listed on the Oslo Stock Exchange and rules applicable to public limited companies in general.
The company observes the Norwegian Code of Practice for Corporate Governance, issued by the Norwegian
Corporate Governance Board (the “Code of Practice”). The Code of Practice is available at www.nues.no.
Application of the Code of Practice is based on the “comply or explain” principle, which stipulates that any
deviations from the code, should be explained. poLight seeks to follow the Code of Practice, and any deviation
will be explained in the corporate governance report included in its annual report. poLight’s corporate
governance policy is available on its website, www.polight.com, in accordance with the company’s IR policy.
The principles and implementation of corporate governance are subject to annual review by the company’s
Board of Directors. The corporate governance policy was last reviewed and approved 11 January 2021.
6. Business
The operations of the company comply with the business objective set forth in its Articles of Association,
which reads as follows:
“The company’s purpose is to develop and deliver optical components and all naturally related activities,
including ownership of shares and other securities in other companies.”
The Board of Directors has established goals, strategies and a risk profile for the company within the
definition of its business objective which are described in the Annual Report. These are subject to annual
review by the Board.
poLight has adopted a set of ethical guidelines (code of conduct) which represents the foundation of poLight’s
corporate culture. The guidelines define the core principles and ethical standards for the company’s
operations, and the integration of stakeholder considerations and how these relate to the value creation by
the company. The code of conduct applies to the members of the Board, all employees and representatives
of poLight as well as direct business partners such as agents or re-sellers. The code is available at
www.polight.com.
Annual Report 2022
Page 26
7. Equity and dividends
Capital adequacy
As at 31 December 2022, poLight's consolidated equity totalled NOK 150.7 million, which is equivalent to
85% of total assets. Liabilities were mainly trade payables and other payables. The Board of Directors is
responsible for ensuring that poLight is adequately capitalised relative to the company’s goals, strategy and
risk profile.
Dividend policy
poLight has not previously distributed any dividends to its shareholders and does not expect to pay any
dividend in the foreseeable future. The company is focused on developing and commercialising its technology
and intends to retain any future earnings to finance development activities, operations and business growth.
Any future decision to pay a dividend will depend on the company's financial position, operating profit and
capital requirements.
Authorisations to the Board of Directors
On 25 May 2022, the annual general meeting (AGM) granted the Board of Directors an authorisation to issue
new shares to holders of share options in poLight who exercise their rights to subscribe for new shares. The
authorisation to issue new shares at a nominal value of NOK 0.04 each, up to the share capital equivalent of
NOK 207,717, is valid until the date of the 2023 AGM, or 30 June 2023 at the latest. As at 31 December 2022,
shares equal to a share capital of NOK 1,089 have been issued under this authorisation.
The AGM on 25 May 2022 granted the Board a general authorisation to issue shares and to increase the share
capital by a maximum of NOK 415,434. The authorisation is valid until the 2023 AGM, or 30 June 2023 at the
latest. As at 31 December 2022, no shares have been issued under this authorisation.
The AGM also granted the Board an authorisation to buy back shares equal to a share capital of NOK 207,717.
The authorisation is valid until the 2023 AGM, or 30 June 2023 at the latest. The authorisation had not been
utilised as at 31 December 2022.
8. Equal treatment of shareholders and transactions with related parties
Pre-emption rights to subscribe
In the event of an increase in share capital, the Board shall propose that existing shareholders be granted
pre-emptive rights. If the Board decides to waive the pre-emptive rights of existing shareholders pursuant to
an authorisation granted to it by a general meeting of shareholders, the reason therefor shall be publicly
disclosed in a stock exchange announcement.
Trading in treasury shares
Any trading undertaken by the company in its own shares shall be carried out through the stock exchange,
and always at prevailing market prices. If there is limited liquidity in the company’s shares, other ways shall
be considered to ensure that all shareholders are treated equally. There has been no trading in treasury
shares after the IPO in 2018.
Approval of agreements with shareholders and related parties
In the event of not immaterial transactions between the company and its shareholders, a shareholder’s
parent company, members of the Board, executive personnel or close associates of any such party, the Board
shall arrange for an independent third-party valuation. There were no transactions with close non-group
Annual Report 2022
Page 27
related parties in 2022. For further details see Note 18 Related parties to the financial statements in the
Annual Report.
9. Shares and negotiability
poLight ASA has one class of shares and each share carries equal rights, including the right to participate in
general meetings. All shareholders shall be treated equally, unless there is just cause for treating them
differently. The company’s shares are freely negotiable.
10. General meetings
The general meeting of shareholders is the company’s highest decision-making body. The Board shall ensure
that the general meeting is an effective forum for communication between the shareholders and the Board,
and enable as many shareholders as possible to exercise their rights through their attendance. Extraordinary
general meetings (EGM) may be called by the Board at any time, or by shareholders representing at least 5%
of the shares.
Notification
The Board will ensure that proposed resolutions and any supporting material shall be sufficiently detailed
and comprehensive to enable shareholders to understand and form an opinion on all matters to be
considered at the general meeting.
Registration and proxies
Deadlines for shareholders to give notice of their attendance at the general meeting shall be set as close to
the date of the general meeting as practically possible. Shareholders who cannot attend the general meeting
may vote by proxy on each individual matter.
Agenda and execution
The agenda for the general meeting is set by the Board. The agenda shall include detailed information on the
resolutions to be considered, as well as the Nomination Committee’s recommendations. The shareholders
attending may vote to determine who will chair the general meeting.
The Board and the general meeting’s chair shall ensure that the shareholders are able to vote separately on
each candidate nominated for election.
Representatives of the Board and the Nomination Committee’s chair shall be present at general meetings.
Although general meetings will normally be chaired by the Board’s chair, the Board must also ensure that the
general meeting can appoint an independent chairperson.
In 2022, poLight held its AGM on 25 May.
11. Nomination Committee
Composition
The company shall have a nomination committee consisting of two to three members, see section 7 of its
Articles of Association. The general meeting elects the Nomination Committee’s members and chair, and
determines their remuneration.
Annual Report 2022
Page 28
As at 31 December 2022, the Nomination Committee consisted of the following three members: Thomas
Wrede Holm (Investinor) as chair, Jan Erik Hæreid (independent) and Anne E. H. Worsøe (independent). The
committee’s members were elected by the AGM for terms lasting until the company's AGM in 2023 or 2024.
None of the Nomination Committee’s members are members of the Board or executive management. The
majority of the Nomination Committee’s members are deemed to be independent of the company’s Board
and executive management.
Tasks
The Nomination Committee is responsible for recommending candidates for election to the Board and the
Board’s chair, and the remuneration payable to members of the Board and its sub-committees. It also
recommends candidates for election to the Nomination Committee itself. The objectives, responsibilities
and functions of the committees are detailed in the company’s “Guidelines for the Nomination
Committee”.
All shareholders are entitled to nominate candidates for election to the Board of poLight ASA. Nominations
are submitted by sending an e-mail to the Nomination Committee’s chair at the following address:
thomas.wrede-holm@investinor.no. Nominations must be received well in advance to be considered for
election at poLight’s AGM. All proposals should include information about the candidate, grounds for
consideration and contact details for the person nominating the candidate concerned.
12. The Board of Directors – composition and independence
According to the company’s Articles of Association, the Board of Directors shall consist of up to five members.
At 31 December 2022, the Board consisted of the following five members: Grethe Viksaas (Chair), Ann-Tove
Kongsnes (Deputy chair), Thomas Görling, Juha Alakarhu and Svenn-Tore Larsen.
The Board’s chair has been elected by the general meeting. Members of the Board are elected for a term of
up to two years at a time and may be re-elected. poLight’s annual report and website provide details of board
members’ background and expertise.
All members of the Board are considered independent of executive management and material business
associates. Further, Grethe Viksaas, Juha Alakarhu and Svenn-Tore Larsen are independent of the company’s
major shareholder(s). The Board of Directors does not include executive personnel.
Name Role
Considered
independent
Served
since Term expires
Participation
at Board
Meetings 2022
Shares in poLight
31 December
(direct/ indirect)
Grethe Viksaas Chair Yes June 2018 AGM 2023 100%
Ann-Tove
Kongsnes
Deputy
c
hair
No December
2011
AGM 2024 86% 5,244,125 (1)
Thomas Görling Board
member
No May 2021 AGM 2023 100% 2,408,642 (2)
Juha Alakarhu Board
member
Yes May 2019 AGM 2023 86%
Svenn-Tore
Larsen
Board
member
Yes May 2019 AGM 2023 71%
Annual Report 2022
Page 29
1) Ann-Tove Kongsnes is Investment Director and Head of International Affairs at Investinor AS. Investinor Direkte AS held
5.24 million shares in poLight ASA at 31 December 2022
2) Thomas Görling is a Senior Investment Director at Stiftelsen Industrifonden, which held 2.4 million shares in poLight ASA at
31 December 2022
Members of the Board of Directors are encouraged to own shares in the company.
13. The work of the Board of Directors
The Board of Directors’ tasks
The Board of Directors is elected by the shareholders to oversee executive management, and to make sure
that the long-term interests of shareholders and other stakeholders are properly served. The Board has
ultimate responsibility for management and the company’s activities in general. Its main responsibilities
include the company’s organisation and planning, and the control and supervision of its operations.
The Board shall also ensure that the organisation of the company’s accounting and cash management is
compliant and under satisfactory control. The Board adopts an annual plan for its work, with particular
emphasis on objectives, strategy and implementation.
Instructions to the Board of Directors
The Board has issued instructions for its own work, as well as for the CEO, to allocate duties and
responsibilities between the CEO and the Board of Directors. The instructions are based on applicable laws
and well-established practices. The current instructions were last amended by the Board in April 2015.
Members of the Board of Directors and the company’s executive management shall notify the Board in the
event of any material direct or indirect interest in a transaction entered into by the company.
The Board’s instructions state that, in situations when its chair cannot, or should not, lead the work of the
Board, the longest-serving director shall chair the Board, until an interim chairperson has been elected by
and from among the directors present.
Audit and Sustainability Committee
The Audit and Sustainability Committee supports the Board with respect to the assessment and control of
financial risk, financial and sustainability reporting, auditing and control, and prepares discussions and
resolutions for board meetings. The Audit and Sustainability Committee does not make decisions on behalf
of the Board, and the establishment of the committee does not alter the Board’s legal responsibilities or
tasks. In addition, under the whistleblower procedure, complaints from employees and other concerned
parties are received and followed up by the Audit and Sustainability Committee. The Chief Financial Officer
participates in the meetings. The committee meet quarterly as a minimum but may meet more frequently if
deemed advisable. One meeting per year is held with the auditor without the Chief Financial Officer or any
other members of the Group Management and administration being present.
The Audit and Sustainability Committee held five meetings in 2022 and was in regular contact with the
company’s auditor regarding audits of the statutory accounts. The committee also assesses and monitors the
auditor’s independence, including non-audit services provided by the auditor.
The committee makes recommendations to the Board with respect to;
the Company’s financial statements, accounting and financial reporting processes and financial
statement audits
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the Company’s compliance with legal and regulatory requirements
the Company’s independent auditors’ qualifications, independence and performance
The tasks and rules of procedure of the Audit Committee are further regulated in the Audit and Sustainability
Committee Charter.
The Audit and Sustainability Committee shall consist of at least two members of the Board. The committee
shall in total have the expertise that, based on the company’s organisation and operations, is necessary to
carry out its tasks. At least one of the members of the committee is to be independent of the operations and
have accounting or auditing qualifications. The Board shall appoint one member of the committee to be its
chair.
As at 31 December 2022, the Audit and Sustainability Committee consisted of the following two members:
Ann-Tove Kongsnes and Grethe Viksaas.
Remuneration Committee
The Board of Directors has established a remuneration committee which assists and facilitates decision-
making related to the remuneration of executive personnel. The purpose of the Remuneration Committee is
to ensure thorough and independent preparation of matters relating to compensation to the executive
personnel. The Remuneration Committee puts forth a recommendation for the Board of Directors’ guidelines
for remuneration to senior executives in accordance with section 6-16a of the Norwegian Public Limited
Liability Companies Act.
The Remuneration Committee shall consist of at least two members of the Board of Directors. The
Remuneration Committee’s members and chair are appointed for a term of two years. All members must be
independent of the company’s executive management.
As at 31 December 2022, the Remuneration Committee consisted of the following three members: Ann-Tove
Kongsnes, Grethe Viksaas and Thomas Görling.
Evaluation of the Board
The Board evaluates its performance and expertise annually.
14. Risk management and internal control
The Board places a high priority on managing risk, and has established routines and policies to limit overall
risk exposure. The rules and guidelines take into account the extent and nature of the company’s activities
and the integration of stakeholder considerations in the company’s value creation through its corporate
values, ethical guidelines and corporate social responsibility policies.
The Board conducts an annual review of the company’s most important areas of risk exposure and its internal
control arrangements.
poLight’s risk management is based on the principle that risk assessment is an integral part of all business
activities. As a technology company with global operations, poLight is exposed to various risk factors of a
financial and operational nature, which may affect business activities and the company’s financial position.
Management reports monthly to the Board of Directors on key operational developments, including project
Annual Report 2022
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risk assessments, and on financial performance. In addition, quarterly financial reports are prepared and
distributed to the financial market, in accordance with the Oslo Stock Exchange’s requirements.
Detailed information on the company’s operational and financial risks are included in the Annual Report.
15. Remuneration of the Board of Directors
The remuneration payable to board members is decided by the AGM, based on the Nomination Committee’s
recommendation. The remuneration paid shall reflect the Board of Directors’ responsibilities, competence,
time involved, and the complexity of the business.
The remuneration of the Board of Directors shall not be performance-based and shall not contain option
elements. Members of board sub-committees shall be compensated separately. The company shall not
provide loans to board members. Detailed information on the remuneration of board members is specified
in Note 20 to the consolidated financial statements.
Members of the Board of Directors and/or companies with which they are associated should not take on
specific assignments for the company in addition to their directorships. Should they do so, however, this must
be disclosed to the full Board. The remuneration for such additional duties must be approved by the Board
of Directors.
16. Remuneration of executive management
The Board of Directors prepares guidelines for the remuneration of the company’s executive management.
These guidelines are communicated annually to the Annual General Meeting. A separate remuneration
report will be published on poLight's website as a part of the notification of the Annual General Meeting.
The remuneration paid to members of executive management consists of a fixed salary in combination with
certain benefits in kind and an performance-based bonus, in addition to participation in a share option
scheme. See Note 5.2 Employee benefits expense, in the consolidated financial statements for further details.
Performance-related remuneration of executive personnel in the form of share options, bonus programmes,
or the like, shall be linked to value creation for the shareholders or the company’s earnings performance over
time.
17. Information and communications
The Board places great emphasis on open, honest and timely dialogue with shareholders, potential investors,
analysts and other participants of the capital markets. The primary purpose of poLight’s external information
activities, is to provide the financial markets with sufficient information to accurately appraise the company’s
shares. Such information shall be presented factually and soberly, and shall be issued using methods and
channels that ensure simultaneous, fair and wide distribution. All information is published in English, which
is poLight’s corporate language.
The company’s primary channels for communication are its interim reports, the annual report and associated
financial statements. poLight also issues other notices to shareholders when appropriate. All reports and
notices are issued and distributed in accordance with the Oslo Stock Exchange’s rules and practices, and are
made available on the company’s website, and at www.newsweb.no.
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poLight has adopted an investor relations policy and guidelines for the company’s contact with shareholders
other than through general meetings. The CEO and the CFO are responsible for communicating with
shareholders, the stock exchange, analysts and the media. The general meeting provides a forum for
shareholders to raise issues with the Board. The Board of Directors will review and evaluate the content of
the IR policy at least annually.
18. Takeovers
General
In the event of a takeover bid, the Board of Directors and the company’s executive management each have
an individual responsibility to ensure that the company’s shareholders are treated equally, and that the
company’s activities are not unnecessarily interrupted. The Board has a special responsibility to ensure that
the shareholders have sufficient information and time to form an informed opinion about the offer.
The Board has established guiding principles for how it will act in the event of a takeover bid. These are
available at www.polight.com.
If an offer is made for the company’s shares, the Board shall issue a statement evaluating the offer, and make
a recommendation as to whether, in the Board’s opinion, the shareholders should or should not accept the
offer. If the Board finds itself unable to give a recommendation to shareholders on whether or not to accept
the offer, it should explain the reasons for this. The Board of Director’s statement on a takeover bid shall
make it clear whether the views expressed are unanimous, and if this is not the case, it shall explain the
reasons why specific members of the Board do not endorse the statement.
The Board shall consider whether to arrange a valuation from an independent expert. If any member of the
Board, or close associates of such member, or anyone who has recently held such a position but has ceased
to do so, is either the bidder or has a particular personal interest in the bid, the Board shall arrange an
independent valuation. This shall also apply if the bidder is a major shareholder. Any such valuation should
either be enclosed with the Board’s statement or reproduced or referred to in the statement.
19. Auditor
The company’s external auditor is KPMG. Each year, the Audit and Sustainability Committee ensures that it
receives a presentation of the auditor’s plan for its annual audit of the company. Additionally, the Audit and
Sustainability Committee requires the auditor to participate in committee meetings where any of the
following is on the agenda: the annual financial statements, accounting principles, assessment of any
important accounting estimates and matters of importance on which there has been disagreement between
the auditor and the company’s management.
At least once a year, the Audit and Sustainability Committee and the auditor will jointly review the company’s
internal control procedures, including identification of weaknesses and proposals for improvement. The
auditor also at least once a year meets with the committee without the presence of the CEO and CFO.
The remuneration paid to the auditor is approved by shareholders at the AGM. The Audit and Sustainability
Committee will provide the AGM with a breakdown of the fee paid for audit work and fees paid for other
services, if any.
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GROUP FINANCIAL STATEMENTS
Consolidated statement of comprehensive income for the year ended 31 December
(in NOK 000) Note
2022
2021
Sale of goods 4
Rendering of services
Revenue
Cost of sales 12
Gross profit
Research and development expenses 5.3
-32 907
-25 360
Sales and marketing expenses 5.4
-13 122
-7 224
Operational / supply chain expenses 5.5
-9 179
-9 139
Administrative expenses 5.6
-12 068
-6 868
Depreciation and amortisation and net impairment losses 8,9,11
-10 400
-11 923
Operating profit / loss (
-
)
-
-
Finance income 5.8
Finance costs 5.8
-2 145
-887
Net financial items
Profit / loss (
-
) before tax
-
-
Income tax expense 6
-242
-93
Profit / loss (
-
) for the year
-
-
Attributable to:
Equity holders of the parent
-67 886
-53 481
Non-controlling interests
Earnings per share:
Basic, attributable to ordinary equity holders of the parent (NOK) 7
-1.31
-1.13
Diluted, attributable to ordinary equity holders of the parent (NOK) 7
-1.31
-1.13
Annual Report 2022
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Consolidated statement of other comprehensive income for the year ended 31 December
(in NOK 000) Note
2022
2021
Profit / loss (
-
) for the year
-
-
Other comprehensive income
Exchange differences on translation of foreign operations 95
-5
Income tax effect 0
Net other comprehensive income to be reclassified to profit or loss in subsequent
periods 95
-5
Total comprehensive income for the year, net of tax -67 791
-53 486
Attributable to:
Equity holders of the parent -67 791
-53 486
Non-controlling interests 0
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Consolidated statement of financial position as at 31 December
(in NOK 000) Note
2022
2021
ASSETS
Property, plant and equipment 8
Intangible assets 9
Right-of-use assets 11
Total non-current assets
Inventories
12
Trade and other
receivables
13.1,14
Prepayments
Cash and cash equivalents 15
Total current assets
Total assets
EQUITY AND LIABILITIES
Share capital 16
Share premium 16
Reserves
Retained earnings
Total equity
Lease liabilities 11
Total non-current liabilities
Trade and other payables
13.2
Current lease liabilities
11
Provisions
17
Total current liabilities
Total liabilities
Total equity and liabilities
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Consolidated statement of changes in equity for the year ended 31 December
Attributable to equity holders of the parent
(in NOK 000) Note
Share
capital
Share
premium
Retained
earnings
Translation
reserve
Total
As at 1 January 2021
Profit / loss (-) for the year
-53 481
-53 481
Other comprehensive income
-5
-5
Total comprehensive income
-53 481
-5
-53 486
Issue of ordinary shares 16
Share options exercised
16
Transaction costs 16
-7 530
-7 530
Equity-settled share-based payments 5.2
Allocation to retained earnings
-49 836
At 31 December 2021
Profit / loss (-) for the year
-
-
Other comprehensive income
Total comprehensive income
-67 886
-67 791
Issue of ordinary shares 16
Share options exercised 16
Transaction costs 16
Equity-settled share-based payments 5.2
Allocation to retained earnings
-63 788
At 31 December 2022
Annual Report 2022
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Consolidated statement of cash flows for the year ended 31 December
(in NOK 000)
Note
2022
2021
Operating activities
Profit / loss (-) before tax
-67 644
-53 388
Adjustments for:
Depreciation and impairment of property, plant and equipment and right-of-
use assets
8
Amortisation and impairment of intangible assets
9
Net finance income
5.8
-1 496
-944
Equity-settled share-based payments
5.2
Other non-cash items
-430
Changes in unrealised net foreign exchange rate differences/fluctuations
Changes in working capital:
Increase (-) in trade and other receivables and prepayments
-11 332
Increase (-) in inventories
12
-28 741
-7 669
Increase (+) in trade and other payables
Changes in provisions and government grants
17,14
-2 954
Interest received 5.8
Interest paid 5.8
-330
-203
Income tax paid
-
-
Net cash flows used in operating activities
-63 600
-49 546
Investing activities
Purchase of property, plant and equipment 8, 9
-9 202
-2 142
Net cash flows used in investing activities
-9 202
-2 142
Financing activities
Proceeds from issuance of ordinary shares 16
Proceeds from exercise of share options
16
Transaction costs on issuance of shares 16
-7 530
Payment of lease liabilities 11
-964
-1 355
Net cash flows
from / (used in) financing activities
-
Net increase in cash and cash equivalents
-73 513
Effect of exchange rate changes on cash and cash equivalents
-49
-26
Cash and cash equivalents at 1 January 15
Cash and cash equivalents at 31 December 15
Annual Report 2022
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Notes to the Consolidated Financial statements
1 Corporate information
registered office is Innlaget 230, N-3185 Skoppum, Norway.
experiences due to benefits such as extremely fast focus, small footprint, no magnetic interference, low power consumption and
constant field of view. For more information, visit www.polight.com.
Information on the Group and related parties are presented in Note 18 Related parties.
The consolidated financial statements of poLight ASA and its subsidiaries (collectively, poLight or the Group) for the year ended 31
December 2022 were authorised for issue in accordance with a resolution of the Board of Directors on 28 April 2023, to be approved
by the annual general meeting on 24 May 2023.
2 Significant accounting policies
2.1 Basis of preparation
The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards Board (IASB) and adopted by the EU (IFRS).
The consolidated financial statements have been prepared on a historical cost basis. The consolidated financial statements are
presented in Norwegian kroner (NOK), and all values are rounded off to the nearest thousand (NOK 000), unless otherwise indicated.
2.2 Basis of consolidation
The consolidated financial statements comprise the financial statements of poLight ASA and its subsidiaries.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of
the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year, are included in the
consolidated financial statements from the date the Group gains control, until the date the Group ceases to control the subsidiary.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with
the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions
between members of the Group are eliminated in full on consolidation.
2.3 Summary of significant accounting policies
The following are the significant accounting policies applied by the Group in preparing its consolidated financial statements:
Current versus non-current classification
The Group presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset
is current when it is:
• Expected to be realised or intended to be sold or consumed in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realised within twelve months after the reporting period, or
• Cash or cash equivalent, unless restricted from being exchanged or used to settle a liability for at least twelve months after
the reporting period
All other assets are classified as non-current.
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A liability is current when:
• Expected to be settled in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be settled within twelve months after the reporting period, or
• The Group does not have an unconditional right to defer settlement of the liability for at least twelve months after the
reporting period
The Group classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
Revenue from contracts with customers
During 2022 the group had two revenue streams:
• Sales of TLenses and related driver ASICs.
The Group recognizes revenue from sale of TLenses and other components at the point in time when the control of goods is
transferred to the customer at an amount that reflects the consideration to which the Group expects to be entitled in
exchange for those goods. Revenue is generally recognised on delivery of the goods.
• Non-recurring engineering (“NRE”) services related to customer development projects.
In certain cases, when the counterparty to the contract is a customer or a potential customer, the Group will engage in
customer development projects financed by the customer. In general, income is recognised when the project is finalised
according to the contract and the customer can obtain the benefits from the project. Revenue may be recognised over time
when one of the following criteria are met:
• Customer consumes benefits as the Group performs the service
• Customer controls benefits as the Group performs the service
Earned revenue for the period is earned revenue at the balance sheet date, less earned revenue in prior periods. If the project
is ongoing, income will be recognized continuously in accordance with the agreement, based on actual deliveries.
The Group has for the periods presented limited sales and revenues. Further information on revenue recognition or disclosures
according to IFRS 15 is consequently not relevant for these financial statements.
Foreign currencies
The Group’s consolidated financial statements are presented in Norwegian kroner (NOK), which is also the parent company’s
functional currency. For each entity, the Group determines the functional currency, and items included in the financial statements of
each entity are measured using that functional currency. The Group uses the direct method of consolidation, and on disposal of a
foreign operation, the gain or loss that is reclassified to profit or loss reflects the amount that arises from using this method.
Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency spot rate, at the
date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currencies are retranslated
at the functional currency spot rate of exchange at the reporting date.
Differences arising on settlement or translation of monetary items are recognised in profit or loss. Non-monetary items that are
measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial
transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date
when the fair value is determined.
On consolidation, the assets and liabilities of foreign operations are translated into NOK at the rate of exchange prevailing at the
reporting date, and the statement of profit or loss are translated at average monthly exchange rates. The exchange differences arising
on the translation are recognised in OCI. Exchange differences arising from the translation of net investment in subsidiaries and
Annual Report 2022
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borrowings are included in OCI. At December 31, 2022 and 2021 an intercompany subordinated loan to poLight France SAS of EUR
2,750,000 was regarded as a part of the net investment in poLight France SAS.
Government grants
Government grants are recognised when there is reasonable assurance that the grant will be received, and that all attached
conditions will be complied with. When the grant relates to an expense item, it is deducted from the related expense on a systematic
basis over the periods that the costs, which it is intended to compensate, are expensed. Where the grant relates to an asset, it reduces
the carrying amount of the asset. The grant is then recognised as income over the useful life of the depreciable asset, by way of a
reduced depreciation charge.
Taxes
Current income tax
Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid
to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted, or substantively
enacted at the reporting date in the countries where the Group operates and generates taxable income.
Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations
are subject to interpretation, and it establishes provisions where appropriate.
Deferred tax
Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities, and their
carrying amounts, for financial reporting purposes at the reporting date.
Deferred tax liabilities are recognised for all taxable temporary differences.
Deferred tax assets are recognised for: all deductible temporary differences: the carry forward of unused tax credits and unused tax
losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable
that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax
assets are reassessed at each reporting date, and are recognised, to the extent that it has become probable that future taxable profits
will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected
to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the end of the reporting period.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised
in correlation to the underlying transaction, either in other comprehensive income or directly in equity.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against
current income tax liabilities, and the deferred taxes relate to the same taxable entity and the same taxation authority.
Property, plant and equipment
Office/lab upgrades and equipment are stated at cost, net of accumulated depreciation and/or accumulated impairment losses, if
any. Such cost includes the cost of replacing parts of the facility upgrades and equipment. Repair and maintenance costs are
recognised in the profit or loss as incurred. Refer to Significant accounting judgements, estimates and assumptions (Note 3).
Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:
• Leased building: The duration of the lease agreement
• Equipment: 3 to 5 years
An item of office/lab upgrade and equipment is derecognised upon disposal, or when no future economic benefits are expected from
its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in the statement of profit or loss when the asset is derecognised.
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The residual values, useful lives and methods of depreciation of office/lab upgrade and equipment are reviewed at each financial
year end, and adjusted prospectively, if appropriate.
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control
the use of an identified asset for a period of time in exchange for consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value
assets. The Group recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the
underlying assets.
i) Right-of-use assets
The Group recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for
use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct
costs incurred, and lease payments made at or before the commencement date less any lease incentives received.
Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the
assets, as follows:
• Office & lab lease, headquarter
The right-of-use assets are also subject to an impairment assessment.
ii) Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments to
be made over the lease term. The lease payments include fixed payments (including in substance fixed payments).
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease commencement date
because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease
liabilities is reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change
in an index or rate used to determine such lease payments).
iii) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of office leases in Finland and China (i.e., those
leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also
applies the lease of low-value assets recognition exemption to leases of office equipment that are considered to be low value. Lease
payments on short-term leases and leases of low value assets are recognised as expense on a straight-line basis over the lease term.
Intangible assets
Intangible assets acquired separately, are measured on initial recognition at cost. Following initial recognition, intangible assets are
carried at cost less accumulated amortisation and accumulated impairment losses, if any. Internally generated intangible assets,
excluding capitalised development costs, are not capitalised, and expenditure is recognised in the statement of profit or loss when it
is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite lives are amortised over their useful lives, and assessed for impairment whenever there is an indication
that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite
useful life are reviewed at least at the end of each year. Changes in the expected useful life are accounted for by changing the
amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on
intangible assets with finite lives is recognised in the statement of profit or loss.
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Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds
and the carrying amount of the asset, and are recognised in the statement of profit or loss when the asset is derecognised.
Development costs
Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset
when the Group can demonstrate:
• The technical feasibility of completing the intangible asset, so that it will be available for use or sale
• Its intention to complete and its ability to use or sell the asset
• How the asset will generate future economic benefits
• The availability of resources to complete the asset
• The ability to measure reliably the expenditure during development
Following initial recognition of the development expenditure as an asset, the cost model is applied, requiring the asset to be carried
at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development
is complete, and the asset is available for use. It is amortised over the period of expected future benefit. During the period of
development, the asset is tested for impairment annually.
Software license
The Group made upfront payments to purchase software licenses. Licences for the use of intellectual property are granted for periods
A summary of the policies applied to the Group’s intangible assets is as follows:
Software licence Development costs
Useful lives Finite (3-5 years) Finite (3-7 years)
Amortisation method used Amortised on a straight- line basis
over the lives of the licences
Amortised on a straight- line basis over
the period of expected consumption of
future economic benefits from the
related project
Internally generated or acquired Acquired Internally generated
Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity, and a financial liability or equity instrument of
another entity.
i) Financial assets
The Group´s financial assets are trade receivables, government grant receivables, accruals and cash.
Trade receivables are measured at the transaction price determined under IFRS 15 Revenue from contracts with customers. The
other financial assets are measured initially at fair value plus transaction costs.
Subsequently the assets are measured at amortised cost. Gains and losses are recognised in profit or loss when the asset is
derecognised, modified or impaired.
ii) Financial liabilities
Financial liabilities are recognised initially at net of directly attributable transaction costs and subsequently measured at amortised
cost.
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
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Impairment of financial assets
For trade receivables and contract assets, the Group applies a simplified approach in calculating expected credit losses (ECLs).
Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each
reporting date.
A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.
Inventories
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition, are accounted for as follows:
Components:
• Purchase cost on a first-in, first-out basis
Finished goods and work in progress:
• Cost of direct materials and services from subcontractors
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the
estimated costs to sell. When determining the net realisable value, the Group assesses the provision for obsolescence. Customers’
demand and age are parameters that are considered when assessing this provision.
Impairment of non-financial assets
Disclosures relating to impairment of non-financial assets are summarised in the following notes:
• Disclosures of significant assumptions Note 3
• Property, plant and equipment Note 8
• Intangible assets Note 9
• Research and development costs Note 10
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or
when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable
amount is the higher of an asset’s or Cash-Generating Unit (CGU)’s fair value less costs of disposal and its value in use. The recoverable
amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those
from other assets, or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is
considered impaired, and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value, using a discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of
disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model
is used.
Value in use impairment calculation is based on detailed budgets and forecasts and with use of scenario analyses. These budgets and
forecast calculations are generally covering a period of five years. A long-term growth rate is calculated and applied to project future
cash flows after the fifth year.
Impairment losses are recognised in the consolidated statement of comprehensive income.
Cash and short-term deposits
Cash and short-term deposits in the statement of financial position comprise cash at banks and on hand, and short-term deposits
with a maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purpose of the consolidated statement cash flows, cash and cash equivalents consist of cash and short-term deposits as
defined above, as they are considered an integral part of the Group’s cash management.
Annual Report 2022
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Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, when it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and when a reliable
estimate can be made of the amount of the obligation. The expense relating to a provision is presented in the statement of profit or
loss.
If the effect of the time value of money is material, provisions are discounted, using a current pre-tax rate that reflects, when
appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is
recognised as a finance cost.
Pensions and other post-employment benefits
The Group operates one defined contribution plan. Contributions are recognised in the statement of income in the period in which
the contribution amounts are earned by the employee.
Share option plans
Employees (including senior executives) of the Group have received remuneration in the form of share options in poLight ASA (equity-
settled transactions). The fair value of share options that are granted has been calculated using the Black-Scholes option pricing
model. The basis for the valuation comprises several factors that affect the calculated fair value of granted share options like the
share price at the date of the grant, exercise price (strike), the expected number of share options that will ultimately vest, risk-free
interest rate and the volatility that is deemed based on historic volatility of the poLight share.
The cost of equity-settled transactions is recognised in employee benefits expense (Note 5.2 Employee benefits expense), together
with a corresponding increase in equity (other equity) over the period in which the service and, where applicable, the performance
conditions are fulfilled (the vesting period). The cumulative expense recognised for equity-settled transactions at each reporting date
until the vesting date, reflects the extent to which the vesting period has expired, and the Group’s best estimate of the number of
equity instruments that will ultimately vest. The share options expense includes accrued social security expenses that are calculated
based on the number of vested share options and a proportion of share options under vesting multiplied by the difference between
market price and exercise price at the end for the period. The expense in the consolidated statement of income for a period,
represents the movement in cumulative expense recognised as at the beginning and end of that period.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share
(further details are given in Note 7).
3 Significant accounting judgements and key sources of estimation uncertainty
3.1 Significant judgements in applying the Group’s accounting policies
Development costs
Initial capitalisation of costs is based on management’s assessment that technological and economic feasibility is likely, usually when
a product development project has reached a defined milestone, according to an established project management model. Cost of
material used in manufacturing line until status of “mass production” is achieved is recognised as development costs to the extent
that it is not sellable parts. In determining the amounts to be capitalised, management makes assumptions regarding the expected
future cash generation of the project, discount rates to be applied, and the expected period of benefits.
3.2 Key sources of estimation uncertainty – significant accounting estimates
The preparation of poLight’s consolidated financial statements requires the use of accounting estimates. Management also needs to
exercise judgment in applying poLight’s accounting policies. These estimates and judgments affect the reported amounts of assets,
liabilities, income and expenses, and the accompanying disclosures. Accounting estimates and assumptions, which are continuously
reviewed, are based on historical experience and various other factors that are believed to be reasonable and appropriate under the
circumstances. Uncertainty about these estimates and assumptions could result in outcomes that require a material adjustment
Annual Report 2022
Page 45
to the carrying amount of assets or liabilities affected in future periods. Changes in accounting estimates and judgments in the
application of accounting policies are recognized in the period in which the estimates and judgments are revised, if the revisions
affect only that period, or in the period of the revisions and future periods if the revisions affect both current and future periods.
The following summarizes the most significant judgments and estimates used in preparing the consolidated financial statements.
Impairment of non-financial assets
Cash-generating units are reviewed for impairment when indicators exists. Judgements are required to determine if impairment
indicators are present. If an impairment test is performed, changes in key assumptions may result in an impairment. See Note 10
Research and development costs for further details.
Share option plans
Estimating fair value for share option plans transactions requires determination of the most appropriate valuation model, which
depends on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the
valuation model, including the expected life of the share option, volatility and dividend yield, and assumptions about the inputs.
For determining the fair value of equity-settled transactions with employees at the grant date, the Group uses the Black-Scholes
option pricing model. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed
in Note 5.2 Employee benefits expense.
Provision for obsolescence
When estimating net realisable value of the inventory the Group assesses the provision for obsolescence. Customers’ demand,
expected sales prices obtainable in the market and age are parameters that are considered when assessing this provision. Customers’
demand for each product and each variant of the products are determined based on feedback from customers using the TLens® in
released products as well as completed and ongoing PoC’s. Specifically, poLight has made provision on most of the first generation
of the TLenses as it most likely is not addressable to the smart phone market or other mass market products as was intended originally
when the wafers were produced. A provision has also been made for low volume units with high purchase price and lenses that are
yet to be tested are partly written down as it is expected that some items will not pass the pre-test and final quality control. In
addition, a general provision has been made for aging of wafers. As there have been limited sales volumes to date, the provisions
made are subject to significant estimation uncertainty.
The provision is disclosed in Note 12 Inventories.
3.3 Measurement of fair values
A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial
assets and liabilities.
The Group has an established control framework with respect to the measurement of fair values. Significant valuation issues are reported
to the Group’s Audit and Sustainability Committee.
When measuring the fair value of an asset or a liability, the Group uses observable market data as far as possible. Fair values are
categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value
measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the
entire measurement. IFRS 13.95 The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting
Annual Report 2022
Page 46
period during which the change has occurred. Further information about the assumptions made in measuring fair values is included in
the following notes:
Note 5.2 Employee benefits expense, Share option plans
Note 12 Inventories
4 Segment information
The Group has only one operating segment – the TLens® technology platform, consistent with the reporting to the CEO and the
Board.
poLight’s product TLens® may be used in devices such as smartphones, wearables, barcode, machine vision systems and various
medical equipment. poLight's TLens® enables better system performance and new user experiences due to benefits such as extremely
fast focus, small footprint, no magnetic interference, low power consumption and constant field of view.
Geographical distribution
Revenue
(in NOK 000)
2022
2021
America
2 198
2 618
Asia
6 222
6 026
Europe
4 943
1 388
Total
13 363
10 032
Geographical distribution
Right-of-use assets
Machinery & equipment
Development costs
(in NOK 000)
2022
2021
2022
2021
2022
2021
Norway
3 871
4 778
2 689
2 097
24 855
33 377
France
0
0
21
16
0
0
Finland
0
0
50
26
0
0
Taiwan
0
0
1 490
184
0
0
The Philippines
0
0
6 461
0
0
0
China
0
0
36
34
0
0
Total
3 871
4 778
10 748
2 356
24 855
33 377
All patents and most of the economic IP (intellectual property) is owned by parent company based in Norway. A sales office has been
established in China, with a parent holding company in Hong Kong.
5 Other income/expenses
5.1 Specification of operating expenses by nature
(in NOK 000)
Note
2022
2021
Employee benefits expense
1)
5.2
45 614
46 866
Depreciation and amortisation
10 400
11 923
Other operating expenses
2)
21 663
1 726
Total operating expenses
77 676
60 514
1) Including consultants engaged on long-term contracts
Annual Report 2022
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2) The positive outcome of the VAT appeal resulted in approximately NOK 12 million being recognised as a cost reduction in
2021
5.2 Employee benefits expense
(in NOK 000)
2022
2021
Included in Research and development expenses:
Wages and salaries
10 533
10 495
Consultants engaged on long-term contracts
8 540
3 979
Social security costs
1 935
2 190
Pension costs
554
374
Other benefits and social costs
422
511
Share based compensation costs (share options)
893
1 951
Grants
-802
-2 162
Included in Sales and marketing expenses:
Wages and salaries
3 354
2 929
Consultants engaged on long-term contracts
3 292
1 509
Social security costs
616
611
Pension costs
176
104
Other benefits and social costs
135
143
Share based compensation costs (share options)
1 883
880
Included in Operational / supply chain expenses:
Wages and salaries
1 679
1 940
Consultants engaged on long-term contracts
3 574
2 342
Social security costs
308
405
Pension costs
88
69
Other benefits and social costs
67
95
Share based compensation costs (share options)
466
1 530
Included in Administrative expenses:
Wages and salaries
8 770
7 808
Consultants engaged on long-term contracts
80
0
Social security costs
1 611
1 630
Pension costs
461
278
Other benefits and social costs
352
380
Share based compensation costs (share options)
-3 375
6 875
Total employee benefits expense
45 614
46 866
Average number of full-time equivalents, employees
23
21
Average number of full-time equivalents, total including long-term contractors
35
27
All employees are included in a cash bonus programme, with identical bonus criteria for all employees except the CEO. The bonus is
calculated based on fixed salary, with maximum 50% for the CEO, 30% for management, 20% for department managers and 10% for
other employees.
Pensions
poLight ASA (the Group’s Norwegian company) is subject to the requirements of the Mandatory Occupational Pensions Act, and the
company’s pension scheme follows the requirements of the Act. As the subsidiaries in France, Finland and China are not subject to
mandatory pension schemes in addition to the national insurance schemes, no pension scheme has been established there.
The pension scheme in Norway is based on a defined contribution plan, and the premium is calculated on the basis of the employees’
income. In 2022 7% of the salary between 0G (1G=NOK 111,477) and 7.1G, and 15% of the salary between 7.1G and 12G was
Annual Report 2022
Page 48
calculated. In 2021 5.55% of the salary between 1G (1G=NOK 106,399) and 7.1G, and 8% of the salary between 7.1G and 12G was
calculated. The period’s contributions are recognised in the Consolidated statement of income as pension cost for the period.
(in NOK 000)
2022
2021
Defined contribution plan
1 195
734
Social security tax
168
104
Total pension cost
1 363
838
Share option plans (equity-settled)
Share options in the parent company are granted to all employees. The exercise price of the share options is equal to, or higher than,
the market price of the underlying shares on the date of grant. The company have two programs.
Program 1: The share options in each agreement are vested over 3 years, and exercisable with 1/36 each month over 3 years,
at the expiry of each calendar month, starting at the date of grant. The company is liable for corporate taxes including National
Insurance up to 20%.
Program 2: The share options in each agreement are vested over 3 years, and exercisable when fully vested. The employee
covers all corporate taxes including National Insurance.
Both programs are conditional on the employee’s continued employment in poLight.
The share options can be exercised up to two years after the three-year vesting period. Exercisable share options may as a general
rule, be exercised and shares issued once per quarter each following the release of poLight ASA’s quarterly reports.
Share option expense
(in NOK 000)
2022
2021
Share based compensation costs
4 821
4 385
Accrued social security
-4 953
6 852
Recognised as employee benefits expense
-133
11 236
The share options expense includes accrued social security expenses that are calculated based on the number of vested share options
and a proportion of share options under vesting multiplied by the difference between market price and exercise price at the end for
the period.
The board is authorised to issue additional shares - in share option scheme - up to total par value of NOK 207 717 (5,192,925 shares
at par value of NOK 0.04).
Annual Report 2022
Page 49
Outstanding share options at December 31, 2022
Year issued
Exercise
price
(NOK)
Outstanding no. of
share options
Exercisable no. of
share options
Remaining
contractual life
(years)
Total expensed
(in NOK 000)
Remaining
estimated expense
(in NOK 000)
2018
10.00
1 617 296
1 617 296
0,80
6 320
0
2019
3.78
202 210
202 210
1,47
375
0
2019
5.40
248 875
248 875
1,47
303
0
2019
6.75
331 930
331 930
1,47
262
0
2020
14.98
948 335
755 835
2,67
6 333
149
2021
22.80
670 000
107 083
3,45
4 844
3 773
2022
21.00
220 000
12 083
4,83
364
1 443
Total
4 238 646
3 275 312
18 801
5 365
Reconciliation of outstanding share options
2022
2021
Number of share
options
WAEP
Number of share
options
WAEP
Outstanding at 1 January
4 045 865
12.4
3 820 660
10.1
Granted during the year
220 000
21.0
670 000
22.8
Forfeited during the year
0
-27 220
8.3
Exercised during the year
-27 221
9.4
-417 575
8.1
Expired during the year
0
0
Outstanding at 31 December
4 238 646
12.9
4 045 865
12.4
In % of outstanding shares
8.16 %
7.79 %
Exercisable at 31 December
3 275 312
10.6
2 734 115
9.8
The weighted average exercise price (WAEP) for the share options exercised during 2022 was NOK 9.4 (2021: NOK 8.1), and the
average market price at the exercise dates was NOK 25.1 (2021: NOK 26.42).
The weighted average exercise price for the share options outstanding as at 31 December 2022, was NOK 12.9 (2021: NOK 12.4) with
a range from NOK 3.78 to NOK 22.80. The weighted average remaining contractual life for the share options outstanding as at 31
December 2022 was 2.01 years (2021: 2.85 years).
At the end of the year, the weighted average exercise price was NOK 10.6 (2021: NOK 9.8) on exercisable options.
In the case of an offeror becomes the owner of at least 9/10 of the issued shares of poLight, all of the unvested share options becomes
immediately vested.
Share option valuation
The fair value of the options granted in 2022 has been calculated to NOK 1.8 million excluding social security expenses (2021: NOK
5.8 million), by using the Black-Scholes option pricing model.
The basis for the valuation comprises several factors that affect the calculated fair value of granted options. The assumptions used
in the calculation was:
Annual Report 2022
Page 50
2022
2021
Program 1
Program 2
Price at grant date
NOK 20.05
NOK 20.05
NOK 22.88
Exercise price
NOK 21
NOK 21
NOK 22.80
Maximum
1)
option life
5 years
5 years
5 years
Assumed option life
2)
2.5 years
4 years
4 years
Risk-free interest rate
3.26%
3.26%
1.15%
Volatility
60 %
60 %
80 %
Fair value per share option
NOK 7.5
NOK 9.5
NOK 13.42
1) The share options expire 5 years from the date of the grant, but any vested options shall be exercised no later than 6
months after last day of service.
2) The option life reflects the vesting time plus one year.
Expected vesting is estimated based on employee turnover, and volatility is deemed based on historic volatility.
Sensitivity analysis
The fair value of the share options granted in 2022 of NOK 1.8 million was determined based on an assumption of a volatility of 60%.
At a volatility of 80%, holding other assumptions constants, would have increased the fair value with NOK 0.5 million over the three-
year vesting period. A decrease in the assumed lifetime of the share options with 1 year, would have decreased the fair value with
NOK 0.4 million over the vesting period.
5.3 Research and development expenses
(in NOK 000)
2022
2021
Employee benefits expense (incl. consultants)
22 878
19 500
Other operating expenses
14 922
17 747
Less government grants
-4 892
-11 886
Capitalized
0
0
Total Research and development expenses
32 907
25 360
Research and development costs that are not eligible for capitalisation have been expensed in the period incurred and are recognised
as Research and development expenses. None of the development projects were eligible for capitalisation during 2022 and 2021.
R&D costs that are expensed, includes R&D management, patents, improvements of the TLens (see Note 14 Government grants),
feasibility study of new concepts, software applications and costs related to integration of TLens in new customer
applications/products.
5.4 Sales and marketing expenses
(in NOK 000)
2022
2021
Employee benefits expense (incl. consultants)
9 457
6 176
Other operating expenses
3 666
1 048
Total Sales and marketing expenses
13 122
7 224
Annual Report 2022
Page 51
5.5 Operational/supply chain expenses
(in NOK 000)
2022
2021
Employee benefits expense (incl. consultants)
6 182
6 381
Other operating expenses
2 997
2 758
Total Operational / supply chain expenses
9 179
9 139
5.6 Administrative expenses
(in NOK 000)
2022
2021
Employee benefits expense
7 900
16 971
Refund of VAT claim
0
-11 624
Other operating expenses
4 168
1 521
Total Administrative expenses
12 068
6 868
On 16 December 2021, the Tax Appeals Board issued a final decision and upheld the appeal, giving poLight full refund of the VAT
claim. NOK 12.4 million was recognised in the fourth quarter 2021, whereof NOK 11.6 million as a reduction of administrative
expenses and NOK 0.8 as financial income (see Note 17 Provisions).
5.7 Auditor's remuneration
(in NOK 000)
2022
2021
Statutory audit fee
798
689
Audit related fee
34
55
Tax related fee
30
30
Other service fee
68
41
Total Auditor's remuneration
(excluding VAT)
930
814
5.8 Financial items
(in NOK 000)
2022
2021
Foreign exchange gain
1 391
465
Interest income
2 249
585
Interest income VAT appeal case
0
780
Finance income
3 640
1 830
Foreign exchange losses
1 776
599
Interest expense on lease liabilities
330
203
Finance expenses
38
84
Finance cost
2 145
887
Annual Report 2022
Page 52
6 Income tax
The significant components of income tax expense are:
(in NOK 000)
2022
2021
Consolidated statement of profit or loss
Current income tax expense
242
93
Deferred tax:
Relating to origination and reversal of temporary differences
0
0
Income tax expense reported in the statement of profit or loss
242
93
A reconciliation between tax expense and the product of accounting profit multiplied by Norway’s domestic tax rate, is as follows:
(in NOK 000)
2022
2021
Calculated income tax at statutory rate of 22%
-14 882
-11 746
Government grants exempt from tax
-1 015
-1 045
Tax effect of permanent differences
-41
2 117
Transaction costs share issues
0
-1 657
Change in unrecognised deferred tax assets
16 280
12 374
Change in tax rate
0
398
Effect of different tax rates compared with Norwegian tax rate
-71
-65
Foreign currency effects
-28
132
Adjustments previous year
0
-415
Income tax expense
242
93
Effective tax rate
0.4 %
0.2 %
Movements in deferred tax balances
Balance at 31 December
2022
(in NOK 000)
Net balance
at 1 January
Recognised
in profit or
loss
Recognised
in OCI
Net
Deferred tax
assets
Deferred tax
liabilities
Property, plant and equipment
427
-423
0
4
4
0
Intangible assets
5 301
-135
0
5 166
5 166
0
Inventories
2 903
74
0
2 978
2 978
0
Group loan
-1 070
0
-318
-1 387
0
-1 387
Provisions
110
110
0
220
220
0
Tax losses carried forward
145 452
17 070
0
162 522
162 522
0
Tax assets (liabilities) before set-
off
153 123
16 696
-318
169 502
170 889
-1 387
Set-off of tax
0
-1 387
1 387
Unrecognised deferred tax assets
-169 502
-169 502
Net tax assets (liabilities)
0
0
0
Annual Report 2022
Page 53
Balance at 31 December
2021
(in NOK 000)
Net balance
at 1 January
Recognised
in profit or
loss
Recognised
in OCI
Net
Deferred
tax assets
Deferred
tax
liabilities
Property, plant and equipment
501
-74
0
427
427
0
Intangible assets
5 436
-135
0
5 301
5 301
0
Inventories
2 788
116
0
2 903
2 903
0
Group loan
-1 361
0
291
-1 070
0
-1 070
Provisions
102
8
0
110
110
0
Tax losses carried forward
133 283
12 168
0
145 452
145 452
0
Tax assets (liabilities) before set-off
140 749
12 083
291
153 123
154 193
-1 070
Set-off of tax
0
-1 070
1 070
Unrecognised deferred tax assets
-153 123
-153 123
Net tax assets (liabilities)
0
0
0
Total unrecognised deferred tax assets net, relate to
(in NOK 000)
2022
2021
Norway (no expiry date)
162 193
146 746
France (no expiry date)
7 309
7 038
Total unrecognised deferred tax assets
169 502
153 784
7 Earnings per share
Basic earnings per share (EPS) is calculated by dividing the profit or loss for the year attributable to ordinary equity holders of the
parent, by the weighted average number of shares outstanding during the year.
The following table reflects the income and share data used in the basic and diluted EPS computations:
2022
2021
1)
Weighted average number of ordinary shares for basic EPS
51 939 025
47 341 744
Effect of dilution:
Share options in-the-money (average)
3 073 867
2 507 374
Anti-dilutive for the periods presented
-3 073 867
-2 507 374
Weighted average number of shares adjusted for the effect of dilution
51 939 025
47 341 744
1) Restated following a share split of 1:5 resolution on 31 May 2022
Fully vested and Exercisable share options have no dilution effect on EPS computations, because this would have decreased loss per
share.
There have been no other transactions involving ordinary shares, or potential ordinary shares, between the reporting date and the
date of authorisation of these financial statements.
Annual Report 2022
Page 54
(in NOK)
2022
2021
Profit / loss (-) attributable to ordinary equity holders of the parent
-67 886
-53 481
Earnings per share for income attributable to equity holders of poLight:
Basic
-1.31
-1.13
Diluted
-1.31
-1.13
8 Property, plant and equipment
(in NOK 000)
Building
Equipment
Total
Cost at 1 January 2021
287
12 268
12 554
Additions
1 126
1 016
2 142
Disposals at cost
-287
-313
-599
Foreign currency translation effect
0
-110
-110
Cost at 31 December 2021
1 126
12 861
13 987
Accumulated depreciation and impairment losses at 1 January 2021
-287
-11 428
-11 715
Depreciation
-113
-512
-625
Accumulated depreciation and impairment losses disposals
287
313
599
Effect of changes in foreign exchange
0
110
110
Accumulated depreciation and impairment losses at 31 December 2021
-113
-11 518
-11 631
Net book value at 31 December 2021
1 013
1 343
2 356
(in NOK 000)
Building
Equipment
Total
Cost at 1 January 2022
1 126
12 861
13 987
Additions
106
9 096
9 202
Foreign currency translation effect
0
124
124
Cost at 31 December 2022
1 232
22 081
23 313
Accumulated depreciation and impairment losses at 1 January 2022
-113
-11 518
-11 631
Depreciation
-236
-482
-717
Impairment losses
0
-94
-94
Effect of changes in foreign exchange
0
-122
-122
Accumulated depreciation and impairment losses at 31 December 2022
-348
-12 217
-12 565
Net book value at 31 December 2022
884
9 864
10 748
Estimated useful lives (years)
1)
3-5
1) Modifications and upgrades in leased premises are depreciated over the leasing period that is estimated to 5 years (including an
option to extend the lease with 2 years).
Annual Report 2022
Page 55
9 Intangible assets
(in NOK 000)
Development costs
and TLens patents
Software
license
Total
Cost at 1 January 2021
78 184
242
78 427
Disposals
0
-61
-61
Cost at 31 December 2021
78 184
181
78 365
Accumulated amortisation and impairment losses at 1 January 2021
-34 539
-242
-34 780
Amortisation
-10 269
0
-10 269
Disposals
0
61
61
Accumulated amortisation and impairment losses at 31 December
2021
-44 807
-181
-44 988
Net book value at 31 December 2021
33 377
0
33 377
(in NOK 000)
Development costs
and TLens patents
Software
license
Total
Cost at 1 January 2022
78 184
181
78 365
Cost at 31 December 2022
78 184
181
78 365
Accumulated amortisation and impairment losses at 1 January 2022
-44 807
-181
-44 988
Amortisation
-8 522
0
-8 522
Accumulated amortisation and impairment losses at 31 December
2022
-53 329
-181
-53 511
Net book value at 31 December 2022
24 855
0
24 855
Intangible assets with finite useful lives, are amortised systematically over their estimated economic lives, ranging between 3 and 7
years.
In 2008/2009, poLight acquired the core patents of the TLens® technology for NOK 5 million. The patents were granted in 10 different
countries in 2006. poLight has since invested substantial resources in research and product development of the TLens®.
poLight started amortising capitalised development costs for TLens Silver and the related ASIC driver in the second quarter of 2019
as they became ready for commercial shipments. The useful lives are deemed to be 7 years which correlates with the remaining
number of years of the first patent.
Research and development costs that are not eligible for capitalisation have been expensed in the period incurred and are recognised
in Research and development expenses net of government grants received.
10 Research and development costs
The part of poLight’s IP (intellectual property) that is recognised as an intangible asset, is the fundamental TLens® technology, which
can become a component in smartphones, wearables, augmented reality and various medical equipment, as well as a wide range of
industrial applications, such as barcode readers and machine vision/sensor applications.
Annual Report 2022
Page 56
(in NOK 000)
Carrying amount
before
impairment
Carrying amount
after impairment
Accumulated net
impairment loss
CGU: TLens® technology platform
At 31 December 2021
51 657
33 377
18 280
At 31 December 2022
43 135
24 855
18 280
The TLens® technology platform is poLight’s major asset. In January 2020, the first product using TLens Silver was launched within
the consumer market segment. A smartwatch phone for children, with a main camera with an advanced autofocus (AF) function
delivered by poLight. Since then, additional 9 design-wins have been achieved. Additional three in consumer products, one web cam
a second smartwatch and in January 2023 the first design-win in smartphone. poLight has also achieve several design wins in industrial
products like barcode, augmented reality (AR) and medical.
The company has one major asset, the TLens® technology platform and the management has evaluated that the group as a whole is
one CGU for impairment testing. The remaining carrying value of development costs are NOK 24.9 million and are related to TLens®
technology platform, that includes the ASIC driver. Indicators of impairment of the TLens ® technology platform have been reviewed,
and none identified.
TLens® Platinum, that is a larger version of the TLens® is still under development. Engineering samples have been produced and have
already been tested by some potential customers. However, activity to prepare TLens® Platinum for mass production has been put
on hold until the product is closer to the anticipated market breakthrough. In December 2019 a management assessment was made
and an impairment charge of NOK 18.3 million was recognised related to this product. The recognition of impairment for accounting
purposes does not imply that the assets have no commercial value.
In addition, management has evaluated that the equity value of the company is an indication of the fair value of the CGU. The
company’s shares are listed on Oslo Stock exchange, and fair value is estimated based on the observed share price. The fair value
measurement is categorized within level 2 of the fair value hierarchy in accordance with IFRS 13. It is considerable headroom between
the carrying value and the fair value less cost of disposal.
11 Lease agreements
poLight has entered into commercial leases with regards to premises and office equipment used in its operations. In Norway, the
company leases lab facilities, including a clean room, and offices are leased in Norway, Finland and China. The premises in Norway
comprises 852 square meters. The contract expires in July 2024 with an option to extend the lease agreement with additional 2 years.
The option is assumed to be utilised determining the lease period, increasing the lease assets and liabilities.
The office lease terms in Finland and China are terminable by both lessee and lessor with twelve months’ notice or less. The leases
of office equipment are with low value. The Group applies the ‘short-term lease’ and ‘lease of low-value assets’ recognition
exemptions for these leases.
Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:
Building
(in NOK 000)
2022
2021
At 1 January
4 778
964
Additions
158
5 309
Termination of contract
0
-465
Depreciation expense
-1 066
-1 029
At 31 December
3 871
4 778
Set out below are the carrying amounts of lease liabilities and the movements during the period:
Annual Report 2022
Page 57
(in NOK 000)
2022
2021
At 1 January
4 876
1 048
Additions
159
5 309
Termination of contract
0
-522
Interest expense
330
243
Payments
-1 295
-1 202
At 31 December
4 070
4 876
Current, < 1 year
1 100
942
Non-current
2 970
3 934
The maturity analysis of lease liabilities are disclosed in Note 13.2 Financial liabilities.
The following are the amounts recognised in profit or loss:
(in NOK 000)
2022
2021
Depreciation expense of right-of-use assets
1 066
1 029
Interest expense on lease liabilities
330
243
Expense relating to short-term leases (included in research and development expenses)
407
389
Expense relating to short-term leases (included in sales and marketing expenses)
769
202
Expense relating to leases of low-value assets (included in administrative expenses)
46
40
Total amount recognised in profit or loss
2 617
1 904
The Group had total cash outflows for leases of NOK 2 516 in 2022 (2021: NOK 1 833). The Group also had non-cash additions to
right-of-use assets and lease liabilities of NOK 159 in 2022 (2021: NOK 5 309). The addition is attributable to the yearly adjustment
in lease payment for the company’s headquarters in Horten.
12 Inventories
(in NOK 000)
2022
2021
Components; mainly wafers (at cost)
50 143
25 304
Finished goods; lenses and driver ASICs (at cost)
8 968
4 730
Obsolescence provision (expensed as cost of sales)
-13 534
-13 198
Total inventories at the lower of cost and net realisable value
45 577
16 836
During 2022, NOK 0.3 million (2021: NOK 0.5 million) was recognised as an obsolescence expense for inventories carried at net
realisable value. This is recognised in cost of sales.
13 Financial assets and financial liabilities
poLight’s principal financial liabilities comprise trade and other payables, lease liabilities and provisions. poLight’s principal financial
assets include trade and other receivables, and cash.
poLight is exposed to foreign currency risk, credit risk and liquidity risk.
Annual Report 2022
Page 58
Foreign currency risk
Trade receivables, trade payables and inventory; poLight’s contracts with the suppliers of the actuator and the assembly of the
TLens®, are in USD. Foreign currency risk will be mitigated by entering sales contracts in USD or using hedging instruments. The group
had not entered into any hedging instruments as at 31 December 2022.
Research and development (“R&D”); a significant part of the R&D expenses is in foreign currency. Services from subsidiaries are
invoiced in EUR and development programs at manufacturing partners are invoiced in USD. These activities have not been hedged
as of today.
The following tables demonstrate the sensitivity to a reasonably possible change in EUR and USD exchange rates, with all other
variables held constant. The impact on the profit before tax is due to changes in the value of monetary assets and liabilities measured
in NOK. The impact on the equity is due to the effect on operating activities.
Change in EUR
rate
Effect on profit
before tax
Effect on equity
(in NOK 000)
(in NOK 000)
2022
+5%
-796
-428
-5%
796
428
2021
+5%
-800
-576
-5%
800
576
Change in USD
rate
Effect on profit
before tax
Effect on equity
2022
+5%
-1 151
-2 605
-5%
1 151
2 605
2021
+5%
-893
-893
-5%
893
893
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a
financial loss. poLight is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing
activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Historically, no bad debt has been recognised and since most receivables are current, no provision is made.
Credit quality of a customer is assessed based on D&B’s credit rating scorecard and are regularly monitored. As at 31 December 2022,
most of the receivables consisted of government grants with low credit risk.
Credit risk from balances with banks are mitigated using 5 different Norwegian banks with a deposit limit of NOK 40 million each.
Credit quality is assessed and regularly monitored.
Liquidity risk
At year-end, poLight had cash deposits of NOK 84 million. In April 2023 the company launched an underwritten preferential rights
issue. The rights issue is fully underwritten and will, when it completed at the beginning of May, raise NOK 135 million in gross
proceeds. All the conditions for the obligations of the underwriters have been met.
Annual Report 2022
Page 59
13.1 Financial assets
(in NOK 000)
2022
2021
Financial assets at amortised cost:
Trade receivables
3 026
2 506
Grants recognised, not received
4 614
7 280
VAT receivables, VAT claim (note 17)
0
11 215
Other receivables
747
1 078
Total financial assets
8 386
22 078
Total current
8 386
22 078
Total non-current
0
0
Trade receivables are non-interest bearing and generally on 30 day terms.
As at 31 December, the ageing analysis of the receivables is as follows:
Not past
due
Past due
(in NOK 000)
Total
< 30 days
30–60 days
61–90 days
91–120 days
> 120 days
2022
8 386
6 512
1 874
0
0
0
0
2021
22 078
21 721
322
35
0
0
0
13.2 Financial liabilities
(in NOK 000)
2022
2021
Financial liabilities at amortised cost, other than interest-bearing loans and
borrowings:
Trade payables
10 612
4 518
Other payables
7 923
6 490
Accrued employer’s NICs on share option plan (note 5.2)
3 945
8 898
Provisions
1 000
500
Total
23 480
20 406
Total current
23 480
20 406
Total non-current
0
0
For all the financial liabilities the carry amounts represent a reasonable approximation of fair value.
Terms and conditions of the above financial liabilities
• Trade payables are non-interest bearing, and are settled on 15–45 day terms
• Other payables are non-interest bearing, and have an average term of 2.6 months
• Accrued employer’s NICs on exercisable share options with remaining contractual life of 2.01 years as at 31 December
2022. See Note 5.2 Employee benefits expense for additional information.
Annual Report 2022
Page 60
Maturity analysis
The maturity analysis below shows the remaining contractual maturity of financial liability. The analysis shows contractual
undiscounted cash-flows (i.e., includes interest), and thus differs from the amounts recognised in the statement of financial position.
(in NOK 000)
< 3 months
3 to 12
months
1 to 5 years
> 5 years
Total
As at 31. December 2022
Lease liabilities
346
1 015
3 232
0
4 593
Trade and other payables
20 679
1 801
0
0
22 480
Total
21 025
2 816
3 232
0
27 073
(in NOK 000)
< 3 months
3 to 12
months
1 to 5 years
> 5 years
Total
As at 31. December 2021
Lease liabilities
317
952
4 445
0
5 715
Trade and payables
18 256
1 650
0
0
19 906
Total
18 574
2 603
4 445
0
25 621
Capital Management
The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital
ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust
the capital structure, the Group may issue new shares and/or debt.
The Group monitors cash monthly towards 5-year budgets and forecasts.
(in NOK 000)
2022
2021
Trade and other payables
23 480
20 406
Less: cash and short-term deposits
-84 249
-157 810
Net debt
-60 769
-137 403
The Group's capital structure is primarily based on deposits.
14 Government grants
(in NOK 000)
2022
2021
Receivable at 1 January
7 280
5 014
Received during the year
-7 558
-9 621
Grants recognised as reduction of research and development expenses in the consolidated
statement of income
4 892
11 886
Receivable at 31 December
4 614
7 280
The group have received grants for development of next generation optical components based on TLens® technology and analyses
and testing activities to understand better relations between micro failure in optical components and mechanical, physical and
riya
Annual Report 2022
Page 61
electric testing. The group has in addition received Tax Refund grants related to project for application reference design enabled by
poLight technology, autofocus lens and ASIC projects.
(in NOK 000)
2022
2021
Current
4 614
7 280
Non-current
0
0
Total
4 614
7 280
15 Cash and short-term deposits
(in NOK 000)
2022
2021
Cash at banks
82 936
156 365
Restricted cash, taxes withheld
1 313
1 263
Restricted cash, deposits
0
181
Cash and short-term deposits
84 249
157 810
Cash at banks earns interest at floating rates based on daily bank deposit rates.
16 Issued capital and reserves
2022
2021
Ordinary shares
51 952 700
51 925 480
1
2) Restated following a share split of 1:5 resolution on 31 May 2022
The shareholders are presented in Note 16 Share capital and shareholder information, in the financial statement of the parent
company, poLight ASA.
Shares issued and fully paid
Number of shares
Issued share capital
(in NOK 000)
At 1 January 2021 of NOK 0.20 each
9 048 822
1 810
Exercise of share options on 3 March 2021 each with a par value of NOK 0.20
79 378
16
Private placement on 13 September 2021 each with a par value of NOK 0.20
1 136 363
227
Exercise of share options on 29 September 2021 each with a par value of NOK 0.20
4 137
1
Subsequent offering on 21 October 2021 each with a par value of NOK 0.20
116 396
23
At 31 December 2021 of NOK 0.20 each
10 385 096
2 077
Exercise of share options on 1 March 2022 each with a par value of NOK 0.20
777
0
Exercise of share options on 25 May 2022 each with a par value of NOK 0.20
4 667
1
Share split of 1:5 on 31 May 2022, par value of NOK 0.04
41 562 160
At 31 December 2022 of NOK 0.04 each
51 952 700
2 078
Annual Report 2022
Page 62
(in NOK 000)
Share premium
At 1 January 2021
125 753
Exercise of share options on 3 March 2021 average of NOK 40.36 (NOK 8.07 after
spilt)
3 188
Private placement on 13 September 2021 of NOK 110 each (NOK 22 after split)
124 773
Exercise of share options on 29 September 2021 average of NOK 46.57 (NOK 9.31
after split)
192
Subsequent offering on 21 October 2021 of NOK 110 each (NOK 22 after split)
12 780
Decrease due to transaction costs for issued share capital
-7 530
Allocated to retain earnings
-49 836
At 31 December 2021
209 320
Exercise of share options on 1 March 2022 average of NOK 8.41 after split
33
Exercise of share options on 25 May 2022 average of NOK 9.54 after split
221
Allocated to retain earnings
-63 788
At 31 December 2022
145 785
To improve the consistency between the presented equity components in the Group and the parent company’s statement of financial
position, historical accumulated losses have been offset against share premium also in the consolidated statement of financial
position. Comparative figures have been restated for 2021.
The board is authorised to increase the share capital issuing new shares up to a total nominal value of NOK 415 434 (10 385 850
shares at par value of NOK 0.04) that is approximately 20 per cent of shares outstanding, in addition to shares through share option
schemes.
Share option schemes
The board is authorised to issue shares through share option schemes up to a total nominal value of NOK 207 717 (5 192 925 shares
at par value of NOK 0.04), that is approximately 10 per cent of shares outstanding. The company’s share option schemes, with the
opportunity to subscribe for shares in poLight, have been offered all employees (Note 5.2 Employee benefits expense).
17 Provisions
(in NOK 000)
Warranty
provision
Claims
Total
At 1 January 2021
0
1 189
1 189
New or increased provisions
500
0
500
Unused reversed as administrative expenses
0
-1 189
-1 189
At 31 December 2021
500
0
500
New or increased provisions
500
0
500
At 31 December 2022
1 000
0
1 000
Annual Report 2022
Page 63
Expected timing of cash flow
(in NOK 000)
Warranty
provision
Claims
Total
Current, < 1 year
1 000
0
1 000
Non-current
0
0
0
At 31 December 2022
1 000
0
1 000
Warranty provision
A general provision to meet potential claims under the warranty clause.
Claims
On 14 September 2018, the Norwegian Tax Administration for South Norway (Skatteetaten Sør-Norge) excluded poLight ASA from
the Norwegian VAT Register and claimed repayment of refunded VAT, with effect from 1 January 2013, totalling NOK 13.6 million.
The Norwegian Tax Administration claimed that the company was not capable of being profitable and did not therefore qualify as a
"business" pursuant to the Norwegian laws and regulations regarding VAT. In September 2018, the decision was appealed to the Tax
Appeals Board (Skatteklagenemda). The entire claim was paid in 2018, except the additional associated taxes of NOK 1.2 million, that
was accrued for as a provision.
On 28 August 2020, the tax authorities decided to re-register poLight ASA in the VAT Register with effect from July 2020 on ordinary
terms. The receivable of NOK 8.2 million was recognised in the third quarter 2020, whereof NOK 7.6 million as a reduction of
administrative expenses. The cash proceeds from this ruling were received in the fourth quarter 2020.
On 16 December 2021, Norway’s Tax Appeals Board issued a final decision and upheld the appeal filed by poLight giving full refund
of the VAT claim. NOK 12.4 million was recognised in the fourth quarter 2021, whereof NOK 11.6 million as a reduction of
administrative expenses and NOK 0.8 as financial income. The outstanding amount was received in January 2022.
18 Related parties
The financial statements include the financial statements of the Group and the subsidiaries listed in the following table:
Name
Principal activities
Country of
incorporation
2022
2021
poLight ASA
R&D, Sales and
management
100 %
100 %
poLight France SAS
R&D
France
100 %
100 %
poLight Finland Oy
R&D
Finland
100 %
100 %
poLight Hong Kong Limited
Holding company
HK, China
100 %
100 %
poLight (Shenzhen) Technical
Service Company Limited
Sales
China
100 %
100 %
the largest shareholder was Investinor Direkte AS, with an ownership of 17.13%.
Transactions between group companies
Intercompany agreements are entered with all the subsidiaries in the Group. All sales in the subsidiaries are made with parent
company. All transactions are considered to be on an arm’s length basis.
Annual Report 2022
Page 64
(in NOK 000)
2022
2021
Purchases from subsidiaries
14 248
11 532
Outstanding balances
Currency
2022
2021
Subordinated loan agreement
EUR 000
2 750
2 750
Trade and other payables
NOK 000
1 217
511
A subordinated loan agreement was concluded on 29 December 2016, between poLight ASA and poLight France SAS. Only the part
that exceeds a prudent level, with regards to both equity and subordinated loan combined, shall be regarded as loan in respect to
interest accrual. For the financial year 2022, the entire principal is considered as equity, and not interest-bearing. Since the loan is
considered to be a part of the net investment in poLight France SAS, the currency translation effect is recognised in OCI. In the parent
company an impairment loss of NOK 27 112 950 related to the subordinated loan have been recognised, whereof NOK 643 750
recognised in 2022.
Transactions with other related parties
No transactions have been made with other related parties for the relevant financial years.
Compensation to management personnel and board of director’s
A separate remuneration report will be published on poLight's website as a part of the notification of the Annual General Meeting.
Management remuneration
In accordance with the Norwegian public Limited Companies Act §6-16 a, the board of directors prepares a separate statement
related to the determination of salary and other benefits for the corporate management. The statement shall be subject to an
advisory vote by the annual general meeting in accordance with §5-6 (3). The statement for 2022 will be submitted for approval in
the annual general meeting 24 May 2023 and will be available on poLight ASA’s website at the time the notice of the meeting is sent
to the shareholders.
The total remuneration to the management consists of fixed salary, bonus, benefits in-kind, share option program and pension
schemes. The fixed salary is subject to an annual evaluation, and any salary increases and other amendments to the employments
terms shall be based on a review by the CEO and the Board each year, taking into account trends in local labour markets, the results
achieved, and individual contributions to the development of the Company.
(in NOK 000)
Salaries
Bonus
Pension
costs
Other
benefits
Value
1)
share
options
Total 2022
2021
Øyvind Isaksen - CEO
3 274
791
160
377
415
5 016
5 653
Pierre Craen - CTO
2)
2 075
474
0
0
111
2 660
2 747
Alf Henning Bekkevik - CFO
1 363
35
152
18
0
1 569
1 661
Marianne Sandal - COO
1 714
387
178
47
111
2 438
2 354
Total management team
8 427
1 688
489
442
638
11 683
12 416
1) Fair value of the share options vested in 2022 are calculated using the Black-Scholes option pricing model at the date of the
grant. No share options were exercised in 2022.
Annual Report 2022
Page 65
2) Pierre Craen has for the period 1.1.2022-31.12.2022 invoiced NOK 2,549 (2021: NOK 2,172) thousand of the remuneration
through Tilia-Blue SRL as a consultant, included in the above figure.
If the company terminates the CEO’s employment, the CEO is entitled to nine months’ salary, in addition to a three months’ notice
period.
Below is an overview of poLight management's and board members' granted share options:
Opening
balance
Forfeited
options
Exercised
options
Granted
options
Ending
balance
Exercisable
options
Øyvind Isaksen - CEO
1 683 746
0
0
0
1 683 746
1 605 968
Pierre Craen - CTO
310 615
0
0
0
310 615
289 712
Alf Henning Bekkevik - CFO
251 115
0
0
0
251 115
251 115
Marianne Sandal - COO
358 615
0
0
0
358 615
337 712
Total management team
2 604 091
0
0
0
2 604 091
2 484 507
The exercise price on exercisable share options for the management’s balance at 31 December 2022 was NOK 9.88 per share in
average. No share options were exercised in 2022.
In the case of an offeror becoming the owner of at least 9/10 of the issued shares of poLight, all of the unvested share options
becomes immediately vested and exercisable.
Remuneration members of the board
(in NOK 000)
2022
2021
Grethe Viksaas - chair of the board
1)
338
213
Ann-Tove Kongsnes
2)
325
288
Svenn Tore Larsen
250
213
Juha Alakarhu
250
213
Thomas Görling
3)
250
125
Total Board of Directors
1 413
1 050
1) Chair of the board from May 25, 2022
2) Chair of the board to May 25, 2022
3) Member from May 26, 2021
There are no loans from poLight to the management or members of the board.
Remuneration of the nomination committee
(in NOK 000)
2022
2021
Thomas S. Wrede-Holm - chair
40
20
Jan-Erik Hæreid
35
20
Anne E. H. Worsøe
35
20
Total Nomination Committee
100
60
Annual Report 2022
Page 66
19 Events after the end of the reporting period
No events have occurred after the end of the reporting period that requires disclosure except that in April 2023 the company
launched an underwritten preferential rights issue. The rights issue is fully underwritten and will, when it completed at the beginning
of May, raise NOK 135 million in gross proceeds. All the conditions for the obligations of the underwriters have been met.
20 Standards issued, but not yet effective
Issued new standards and amendments are either not applicable for the Group or are not considered to have a significant impact on
the financial statements.
Annual Report 2022
Page 67
POLIGHT ASA FINANCIAL STATEMENTS
Statement of income poLight ASA – for the year ended 31 December
(in NOK 000)
Note
2022
2021
Sale of goods
2
10 034
8 683
Rendering of services
2
3 328
1 350
Revenue
13 363
10 032
Cost of sales
13
4 826
3 851
Gross profit
8 536
6 182
Research and development expenses
-34 547
-26 142
Sales and marketing expenses
-13 433
-7 866
Operational / supply chain expenses
-9 179
-9 139
Administrative expenses
-13 361
-8 127
Depreciation, amortisation and net impairment losses
10,11
-9 286
-10 855
Operating profit / loss (-)
-71 269
-55 948
Net financial items
8
2 660
1 728
Profit / loss (-) before tax
-68 609
-54 220
Income tax expense
9
0
0
Profit / loss (-) for the year
-68 609
-54 220
Allocated to/from:
Share premium
17
-63 788
-49 836
Retained earnings
17
-4 821
-4 385
Profit / loss (-) for the year
-68 609
-54 220
Annual Report 2022
Page 68
Balance sheet poLight ASA – as at 31 December
(in NOK 000)
Note
2022
2021
ASSETS
Property, plant and equipment
10
10 641
2 280
Intangible assets
11
24 855
33 377
Investments in subsidiaries
12
320
320
Subordinated loan to subsidiaries
14,20
1 800
1 000
Total non-current assets
37 615
36 977
Inventories
13
45 577
16 836
Trade receivables
14
3 026
2 506
Other receivables
14
5 608
20 325
Cash and cash equivalents
15
78 808
154 660
Total current assets
133 019
194 326
Total assets
170 634
231 303
EQUITY AND LIABILITIES
Share capital
16,17
2 078
2 077
Share premium
17
145 785
209 320
Total equity
147 863
211 397
Trade payables
14
11 311
4 932
Public duties payable
6 021
10 894
Other payables
14
5 440
4 080
Total current liabilities
22 771
19 906
Total liabilities
22 771
19 906
Total equity and liabilities
170 634
231 303
Horten, 28 April 2023
THE BOARD OF DIRECTORS OF POLIGHT ASA
Grethe Viksaas (sign)
Chair, Independent
Ann-Tove Kongsnes (sign)
Deputy chair
Thomas Görling (sign)
Board member
Svenn-Tore Larsen (sign)
Board member, Independent
Dr Juha Alakarhu (sign)
Board member, Independent
Dr Øyvind Isaksen (sign)
Chief Executive Officer
Annual Report 2022
Page 69
Statement of cash flows poLight ASA – for the year ended 31 December
(in NOK 000) Note
2022
2021
Operating activities
Profit before tax
-68 609
-54 220
Depreciation, amortisation and net impairment losses
10,11
9 286
10 855
Changes in inventories, accounts receivables and accounts payable
-22 883
-7 483
Changes in other accruals
15 224
-1 029
Net cash flows from / (used in) operating activities
-66 982
-51 877
Investing activities
Purchase of property, plant and equipment 10
-9 124
-2 099
Dividend from subsidiaries 8
0
504
Net cash flows from / (used in) investing activities
-9 124
-1 595
Financing activities
Proceeds from Issue of ordinary shares 17
0
137 803
Proceeds from exercise of share options 17
254
3 397
Transaction costs on issue of shares 17
0
-7 530
Net cash flows from / (used in) financing activities
254
133 670
Net increase in cash and cash equivalents
-75 852
80 198
Cash and cash equivalents at 1 January 15
154 660
74 462
Cash and cash equivalents at 31 December 15
78 808
154 660
Annual Report 2022
Page 70
Notes to the Financial statement poLight ASA
1 Significant accounting policies
The financial statements have been prepared in accordance with the Norwegian Accounting Act and generally accepted accounting
principles in Norway. The consolidated financial statements of the Group have been prepared in accordance with IFRS. The
Company’s accounting principles are similar to the accounting principles for the Group unless otherwise noted. Financial statement
disclosures for the Company that are substantially different from the disclosures from the disclosures for the Group are shown below.
See notes to the consolidated financial statements.
Use of estimates
The management has used estimates and assumptions that have affected assets, liabilities, incomes, expenses and information about
potential liabilities in accordance with generally accepted accounting principles in Norway.
Foreign currency translation
Transactions in foreign currency are translated at the rate applicable on the transaction date. Monetary items in a foreign currency
are translated into NOK, using the exchange rate applicable on the balance sheet date. Non-monetary items that are measured at
their historical price expressed in a foreign currency are translated into NOK, using the exchange rate applicable on the transaction
date. Non-monetary items that are measured at their fair value expressed in a foreign currency are translated at the exchange rate
applicable on the balance sheet date. Changes to exchange rates are recognised in the income statement as they occur during the
accounting period.
Revenue recognition
Revenues from the sale of goods are recognised in the income statement, once delivery has taken place and the risk and control has
been transferred.
Research and development
Development costs are capitalised, providing that a future economic benefit associated with development of the intangible asset
can be established and costs can be measured reliably. Otherwise, the costs are expensed as incurred. Capitalised development
cost is amortised straight-line over its useful life. Research costs are expensed as incurred.
Government grants
Government grants are recognised when there is reasonable assurance that the grant will be received, and that all attached
conditions will be complied with. When the grant relates to an expense item, it is deducted in the related expense on a systematic
basis over the periods that the costs it is intended to compensate, are expensed. Where the grant relates to an asset, it reduces the
carrying amount of the asset. The grant is then recognised as income over the useful life of the depreciable asset by way of a reduced
depreciation charge.
Income tax
The tax expense comprises tax payable and changes to deferred tax. Deferred tax/tax assets are calculated on all differences between
the book value and tax value of assets and liabilities. Deferred tax is calculated as 22% of temporary differences and the tax effect of
tax losses carried forward. Deferred tax assets are recorded in the balance sheet when it is more likely than not that the tax assets
will be utilized. Taxes payable and deferred taxes are recognised directly in equity, to the extent that they relate to equity
transactions.
Classification and valuation of balance sheet items
Current assets and short-term liabilities consist of receivables and payables due within one year, and items related to the operating
cycle. Other balance sheet items are classified as fixed assets/long-term liabilities.
Current assets are valued at the lower of cost and fair value. Short-term liabilities are recognised at nominal value.
Fixed assets are valued at cost, less depreciation and impairment losses. Long-term liabilities are recognised at nominal value.
Annual Report 2022
Page 71
Fixed assets
Property, plant and equipment is capitalised and depreciated straight-line over the estimated useful life. Significant fixed assets which
consist of substantial components with dissimilar economic life, have been unbundled; depreciation of each component is based on
the economic life of the component. Costs for maintenance are expensed as incurred, whereas costs for improving and upgrading
property, plant and equipment are added to the acquisition cost and depreciated with the related asset. If carrying value of a non-
current asset exceeds the estimated recoverable amount, the asset is written down to the recoverable amount. The recoverable
amount is the greater of the net realisable value and value in use. In assessing value in use, the discounted estimated future cash
flows from the asset are discounted.
Investments in subsidiaries
The investments in subsidiaries are valued as cost less any impairment losses. An impairment loss is recognised if the impairment is
not considered temporary, in accordance with generally accepted accounting principles. Impairment losses are reversed if the reason
for the impairment loss disappears in a later period.
Dividends, group contributions and other distributions from subsidiaries are recognised in the same year as they are recognised in
the financial statement of the subsidiaries. If dividends/group contribution exceeds withheld profits after the acquisition date, the
excess amount represents repayment of invested capital, and the distribution will be deducted from the recorded value of the
acquisition in the balance sheet for the parent company.
Inventory
Inventories are recognised at the lowest of cost and net selling price. The net selling price is the estimated selling price in the case of
ordinary operations, minus the estimated completion, marketing and distribution costs. The cost is arrived at using the FIFO method,
and includes the costs incurred in acquiring the goods and the costs of bringing the goods to their current state and location.
Receivables
Accounts receivable and other current receivables are recorded in the balance sheet at nominal value less provisions for doubtful
accounts. Provisions for doubtful accounts are based on an individual assessment of the different receivables. For the remaining
receivables, a general provision is estimated, based on expected loss.
Cash flow statement
The cash flow statement is presented using the indirect method. Cash and cash equivalents include cash, bank deposits and other
short-term, highly liquid investments with maturities of three months or less.
2 Revenue
(in NOK 000) 2022
2021
By business area
TLens® 13 363
10 032
Total 13 363
10 032
Geographical distribution
America 2 198
2 618
Asia 6 222
6 026
Europe
4
9
43
1 388
Total 13 363
10 032
Annual Report 2022
Page 72
3 Specification of operating expenses by nature
(in NOK 000) Note 2022
2021
Employee benefits expense
1)
5,
6
3
6
635
3
0
59
4
Depreciation, amortisation and net impairment losses 10,11 9 286
10 855
Other operating expenses
2)
7,18 33 885
20 680
Total operating expenses
79
805
62
130
1) Including consultants engaged on long-term contract
2) The positive outcome of the VAT appeal resulted in approximately NOK 12 million being recognised as a cost reduction in
2021
4 Government grants
(in NOK 000) 2022
2021
At 1 January 7 280
5 014
Received during the year -7 558
-9 621
Released to the statement of comprehensive income
4
8
92
11
886
At 31 December
4
614
7
280
poLight ASA has received grants for reimbursement of expenses related to technology and product development and customer
product design.
5 Employee benefits expense
(in NOK 000) 2022
2021
Wages and salaries
1
7
12
7
1
6
5
12
Consultants engaged on long-term contract 15 486
7 830
Social security costs 2 732
3 245
Pension costs (note 6) 1 280
825
Other benefits and social costs 945
938
Share based compensation costs -133
11 236
Grants -802
-2 162
Total employee benefits expense 36 635
38 424
Average number of full-time equivalents, employees 14
14
Average number of full-time equivalents, total including long-term contracts 26
19
All employees are included in a bonus programme, with identical bonus criteria for all, except the CEO. The bonus is calculated based
on fixed salary, with maximum 50% for the CEO, 30% for management, 20% for department managers and 10% for other employees.
All employees in the group are included in a share option programme. Details are presented in Note 5.2 Employee benefits expense,
in the consolidated financial statement.
Management and board member’s remuneration are presented in Note 18 Related parties, in the consolidated financial statement.
6 Pensions
PoLight ASA is subject to the requirements in the Mandatory Occupational Pensions Act, and the company’s pension scheme adheres
to the stipulations of the Act.
Annual Report 2022
Page 73
The pension scheme is based on a defined contribution plan, and the premium is calculated on the basis of the employee’s income.
In 2022 7% of the salary between 0G (1G=NOK 111,477) and 7.1G, and 15% of the salary between 7.1G and 12G was calculated. In
2021 5.55% of the salary between 1G (1G=NOK 106,399) and 7.1G, and 8% of the salary between 7.1G and 12G was calculated. At
31 December 2022, 18 members were covered by the plan.
(in NOK 000) 2022
2021
Defined contribution plan
1 195
734
Social security
168
104
Total pension cost
1 363
838
7 Auditor's remuneration
(in NOK 000) 2022
2021
Statutory audit fee 748
640
Audit related fee 34
55
Tax related fee 30
30
Other service fee 68
41
Total (excluding VAT) 880
765
8 Financial items
Finance income
(in NOK 000) 2022
2021
Interest income from group companies *) 0
0
Other interest income
2
247
1 365
Currency gain on loan to group companies 1 444
0
Reversal of impairment on group loan 0
1 324
Dividend subsidiaries 0
504
Other financial income (currency gain) 1 391
465
Total finance income 5 082
3 659
*) According to the subordinated loan (see Note 14 Intercompany balances with group companies) only the part that exceeds a
prudent level, both equity and subordinated loan combined, shall be regarded as loan in respect to interest accrual.
Finance expenses
(in NOK 000) 2022
2021
Other interest expenses 2
1
Currency loss on loan to group companies
0
1 324
Impairment of group loan 644
0
Other financial expenses (currency loss) 1 776
606
Total finance expenses 2 422
1 931
Annual Report 2022
Page 74
9 Income tax
Income tax expense
(in NOK 000)
202
2
202
1
Current income tax
expense
0
0
Changes in deferred tax 0
0
Total income tax expense 0
0
Tax base calculation
(in NOK 000)
202
2
202
1
Profit before income tax
-
68
6
0
9
-
54
220
Permanent differences -188
9 603
Transaction costs on issue of shares 0
-7 530
Government grants exempt from tax -4 614
-4 750
Temporary differences
-
2 4
9
9
-
390
Adjustments previous year 0
-1 888
Tax base
-75 910
-59 175
Temporary differences:
(in NOK 000)
202
2
202
1
Inventories
13
534
1
3
1
98
Fixed assets
18
1 940
Intangible assets 23 481
24 095
Group loan
20 806
21 606
Provisions
1 0
00
500
Tax losses carry forward 705 065
629 155
Net deferred tax assets/(liabilities) 763 903
690 493
22 % deferred tax asset/(liability) 168 059
151 908
Unrecognised deferred tax assets -168 059
-151 908
Recognised net deferred tax assets 0
0
Reconciliation of nominal tax rate to effective tax rate:
(in NOK 000)
2022
Calculated income tax at statutory rate of 22%
-15 094
Tax effect of permanent differences
-
4
1
Government grants exempt from tax
-1 015
Change in unrecognised deferred tax assets
16 150
Income tax expense
0
Effective tax rate
0,0 %
Annual Report 2022
Page 75
10 Property, plant and equipment
(in NOK 000)
Building
Equipment
Total
Cost at 1 January 202
2
1 126
10
88
2
1
2
0
08
Additions
106
9 018
9 124
Cost at 31 December 2022
1 232
19 901
21 133
Accumulated depreciation -348
-9 821
-10 169
Accumulated impairment losses
0
-
3
2
3
-
3
2
3
Accumulated depreciation and impairment losses at 31 December 2022 -348
-10 144
-10 492
Net book
value at 31 December 202
2
884
9
7
57
10
641
Depreciation for the year
236
434
670
Impairment losses for the year
0
94
94
Estimated useful lives (years)
1)
3-7
Amortisation plan
Linear
Linear
1) Modifications and upgrades in leased premises are depreciated over the leasing period.
11 Intangible assets
(in NOK 000)
Development
costs and
TLens patents
Software
license
Total
Cost at 1 January 2022
78 184
110
78 294
Disposals
0
0
0
Additions
0
0
0
Cost at 31 December 2022
78 184
110
78 294
Accumulated amortisation
-
35
049
-
110
-
35
159
Accumulated impairment losses
-18 280
0
-18 280
Accumulated amortisation and impairment losses at 31
December 202
2
-
53
329
-
110
-
53
439
Net book value at 31 December 2022
24 855
0
24 855
Amortisation for the year
8 522
0
8 522
Estimated useful lives (years)
3-7
3-7
Amortisation plan
Linear
Linear
In 2008/2009, poLight acquired the core patents of the TLens® technology for NOK 5 million. The patents were granted in 10 different
countries in 2006. poLight has since invested substantial resources in research and product development of the TLens®.
poLight started amortising capitalised development investments for TLens Silver and the related ASIC driver in the second quarter of
2019 as they became ready for commercial shipments. The useful lives are deemed to be 7 years which correlates with the remaining
number of years of the first patent.
Research and development costs that are not eligible for capitalisation have been expensed in the period incurred and are recognised
in Research and development expenses.
Annual Report 2022
Page 76
12 Investment in subsidiaries
Company
Date of
foundation
Location
Share
ownership
Voting
rights
poLight France SAS 19.08.2010 Lyon, France 100 % 100 %
poLight Finland Oy 15.09.2016 Tampere, Finland 100 % 100 %
poLight Hong Kong Limited 08.12.2016 HK, China 100 % 100 %
poLight (Shenzhen) Technical Service Company
Limited 24.04.2017 Shenzhen, China 100 % 100 %
Company Share capital
Number of
shares
Book value
Equity
Net profit
2022
NOK 000
NOK 000
NOK 000
NOK 000
poLight France SAS
80
10 000
0
-
23
137
37
2
poLight Finland Oy 23
100
23
1 687
959
poLight Hong Kong Limited 202
200 000
202
202
0
poLight (Shenzhen) Technical Service Company
Limited
246
200 000
94
1
816
295
The entities in France and Finland provide R&D services to poLight ASA, Norway. In China a sales office is established with a parent
holding company in Hong Kong.
13 Inventories
(in NOK 000)
2022
2021
Work in progress (at cost)
50 143
25 304
Finished goods (at cost)
8 968
4 730
Obsolescence provision (expensed as cost of sales)
-13 534
-13 198
Total inventories at the lower of cost and net realisable value
45 577
16 836
During 2022, NOK 0.3 million (2021: NOK 0.5 million) was recognised as an obsolescence expense for inventories carried at net
realisable value. This is recognised in cost of sales.
14 Intercompany balances with group companies
Receivables
(in NOK 000) 2022 2021
Trade receivable 0 0
Other receivables 0 0
Total 0 0
Annual Report 2022
Page 77
Subordinated loan
(in NOK 000) 2022 2021
Non-current receivables
28 913 27 469
Impairment
-27 113 -26 469
Total 1 800 1 000
A subordinated loan agreement was concluded on 29 December 2016, replacing all intercompany balance. Because of limited activity
in France, a significant part of the loan has been subject to impairment.
Payables
(i
n NOK 000)
202
2
202
1
Trade payables 1 217 511
Other payables
0
0
Total
1
217
5
11
15 Cash and short-term deposits
(in NOK 000)
202
2
202
1
Cash at banks and on hand 77 496
153 216
Restricted cash, taxes withheld 1 313
1 263
Restricted cash, deposits 0
181
Cash and short
-
term deposits
78
8
0
8
154
660
16 Share capital and shareholder information
Number of
shares
Par value
Book value
NOK
NOK 000
Ordinary shares
51 952 700
0.04
2 078
Shareholders of poLight ASA at December 31, 2022
Ordinary
shares
Share-
holding
Voting rights
%
%
Investinor Direkte AS
8 899 290
17.1 %
17.1 %
Stiftelsen Industrifonden
5 244 125
10.1 %
10.1 %
Nordnet Bank AB (nominee)
2 408 642
4.6 %
4.6 %
Nordnet Livsforsikring AS
2 156 769
4.2 %
4.2 %
Deutsche Bank Aktiengesellschaft (nominee)
1 950 930
3.8 %
3.8 %
VPF Nordea Avkastning
778 075
1.5 %
1.5 %
VPF Pareto Investment
628 000
1.2 %
1.2 %
VPF Nordea Kapital
506 222
1.0 %
1.0 %
Danske Bank A/S (nominee)
392 754
0
.
8 %
0
.
8 %
VPF Nordea Norge Plus
362 535
0.7 %
0.7 %
Stefan Sveen
338 000
0
.
7 %
0
.
7 %
Saxo Bank A/S (nominee)
325 465
0.6 %
0.6 %
LHH AS
310 000
0
.
6 %
0
.
6 %
Kjell Mossefin
307 500
0.6 %
0.6 %
Asbjørn John Buanes
307 465
0
.
6 %
0
.
6 %
Erik Schellhorn
305 497
0.6 %
0.6 %
Trond
Andersen
297 315
0
.
6 %
0
.
6 %
Annual Report 2022
Page 78
Fjellstuens Eftf. AS
296 285
0
.
6 %
0
.
6 %
Li Zhang
255 884
0.5 %
0.5 %
Åge Sverre Heggheim
222 000
0
.
4 %
0
.
4 %
Total number of shares owned by top 20 shareholders
26 292 753
50.6 %
50.6 %
Number of shares owned by other shareholders
25 659 947
49.4 %
49.4 %
Total number of shares
51 952 700
100.0 %
100.0 %
At 31 December 2022, Øyvind Isaksen, CEO, owned 124,280 shares (0.24%), through his company Oimacon AS.
17 Equity
(in NOK 000)
Share
capital
Share
premium
Retained
earnings
Total
Equity at 31 December 2022 2 077
209 320
0
211 397
Profit for the period
-68 609
-68 609
Share options exercised 1
253
0
254
Equity-settled share-based payment
4 821
4 821
Allocation to retained earnings
-63 788
63 788
0
Equity at 31 December 202
2
2 07
8
145
785
0
147
863
18 Operating lease agreements
poLight ASA has entered into commercial leases on premises and office equipment. The premises (lab facilities and offices) comprise
1,080 square meters, and the contract is renewed annually, with twelve months’ notice.
Future minimum rentals payable under non-cancellable operating leases are as follows:
(in NOK 000) 2022
2021
Within one year
1
365
1
273
After one year but not more than five years
3
232
4 445
More than five years 0
0
Total 4 597
5 718
19 Provisions
(in NOK 000)
Warranty
provision
Total
At 1 January 202
2
50
0
500
New or increased provisions
500
500
At 31 December 2022
1 000
1 000
Expected timing of cash flow
(i
n NOK 000)
Warranty
provision
Total
Current, < 1 year
1 000
1 000
Non
-
current
0
0
At 31 December 2022
1 000
1 000
Annual Report 2022
Page 79
Warranty provision
A general provision to meet potential claims under the warranty clause.
Claims
On 14 September 2018, the Norwegian Tax Administration for South Norway (Skatteetaten Sør-Norge) excluded poLight ASA from
the Norwegian VAT Register and claimed repayment of refunded VAT, with effect from 1 January 2013, totalling NOK 13.6 million.
The Norwegian Tax Administration claimed that the company was not capable of being profitable and did not therefore qualify as a
"business" pursuant to the Norwegian laws and regulations regarding VAT. In September 2018, the decision was appealed to the Tax
Appeals Board (Skatteklagenemda). The entire claim was paid in 2018, except the additional associated taxes of NOK 1.2 million, that
was accrued for as a provision.
On 28 August 2020, the tax authorities decided to re-register poLight ASA in the VAT Register with effect from July 2020 on ordinary
terms. The receivable of NOK 8.2 million was recognised in the third quarter 2020, whereof NOK 7.6 million as a reduction of
administrative expenses. The cash proceeds from this ruling were received in the fourth quarter 2020.
On 16 December 2021, Norway’s Tax Appeals Board issued a final decision and upheld the appeal filed by poLight giving full refund
of the VAT claim. NOK 12.4 million was recognised in the fourth quarter 2021, whereof NOK 11.6 million as a reduction of
administrative expenses and NOK 0.8 as financial income. The outstanding amount was received in January 2022.
20 Related parties
poLight ASA is the ultimate parent. None of the shareholders of poLight ASA has control of the company. As of 31 December 2022,
the largest shareholder is Investinor Direkte AS, with an ownership of 17.1%.
Transactions between group companies
Intercompany agreements are entered with all the subsidiaries in the group. All sales in the subsidiaries are made with the parent
company. All transactions are considered to be on an arm’s length basis.
A subordinated loan agreement (balance 31.12.2022: EUR 2,750,000) was concluded on 29 December 2016, between poLight ASA
and poLight France SAS. Only the part that exceeds a prudent level, with regards both to equity and subordinated loan combined,
shall be regarded as loan in respect to interest accrual. For the financial year 2022, the entire principal is considered as equity, and
not interest-bearing.
Transactions with other related parties
No transactions were made with other related parties for the relevant financial years.
21 Events after the balance sheet date
No events have occurred after the end of the reporting period that requires disclosure except that in April 2023 the company
launched an underwritten preferential rights issue. The rights issue is fully underwritten and will, when it completed at the beginning
of May, raise NOK 135 million in gross proceeds. All the conditions for the obligations of the underwriters have been met.
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CONTACT DETAILS
Homepage www.polight.com
HQ address Innlaget 230, 3185 Skoppum, Norway
Investor relations contacts:
Øyvind Isaksen CEO +47 90876398, oyvind.isaksen@polight.com
Alf Henning Bekkevik +47 91630514, alf.henning.bekkevik@polight.com
Annual Report 2022
Page 84
poLight ASA
Innlaget 230
NO-3185 Skoppum, Norway
Tel: +47 33 07 12 60
E
-
mail: info@polight.com