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Group Management Report

of InVision AG for the Financial Year 2020

The following management report was prepared in accordance with the requirements under § 315 of the German Commercial Code (HGB) and contains information about InVision AG, Düsseldorf (hereinafter also referred to as “AG” or “Company”), and its consolidated subsidiaries (hereinafter together with the Company also collectively referred to as “InVision”, “InVision Group”, “the Group” or “we”). As the Group’s parent company, InVision AG performs group management functions and, at the same time, is the key member of the InVision Group. The explanations below generally relate to the Group, unless there has been an express reference to the Company itself.

The Company


The InVision Group develops and markets products and services for optimising workforce management and education, and is mainly active in Europe and the United States.


On 31 December 2020, InVision employed 118 people worldwide (including the Executive Board). The number of employees as of the balance sheet date was thus higher than in the previous year (31 December 2019: 110 employees). At the end of the year, 89 people were employed in Germany (31 December 2019: 86 employees), while 29 people were employed at the foreign subsidiaries (31 December 2019: 24 employees).

Research & Development

The research and development costs in the fiscal year decreased by 6.5 percent and totalled TEUR 5,282 (previous year: TEUR 5,650). Research and development costs as a percentage of revenues are at 41 percent (31 December 2019: 45 percent).

Information pursuant to § 315 a HGB

The Company’s registered share capital equals EUR 2,235,000 and is divided into 2,235,000 no-par value bearer shares. Each such share represents a notional share of the registered share capital of EUR 1.00. Each share entitles the holder to a single vote. Shareholders may exercise their rights and cast their votes at the Annual Shareholders’ Meeting in accordance with the Company’s articles of association and the statutory rules.

Pursuant to a resolution adopted by the Company’s Shareholders’ Meeting on 29 May 2020, the Executive Board was authorised in accordance with § 4 (4) of the Company’s articles of association but subject to the consent of the Company’s Supervisory Board, to increase the Company’s registered share capital one or more times by a total of up to EUR 1,117,500 on or before 28 May 2025 and to do so by issuing new, no-par bearer shares in exchange for cash and/or non-cash capital contributions (Authorised Capital Account 2020). The new shares can also be transferred to certain banks specified by the Executive Board, which assume the responsibility of offering them to shareholders (indirect subscription rights).

The Executive Board is authorised, however, with the consent of the Supervisory Board, to exclude the shareholders’ pre-emptive right to subscribe shares in the following cases:

  • for fractional amounts,
  • if the capital increase is carried out against cash capital contributions and the pro rata amount of registered share capital attributable to the new shares, for which the pre-emptive right is excluded, does not exceed 10 percent of the registered share capital available on the date that the new shares are issued and, in accordance with §§ 203 (1) and (2), 186 (3) sentence 4 AktG, the issue price of the new shares is not significantly lower than the stock market price of the same class of existing publicly listed shares (with the same features) at the time that the Executive Board definitively sets the issue price. Included in this maximum threshold amount for a pre-emptive right’s exclusion is the pro rata amount of the registered share capital that is attributable to shares, which had already been issued since 29 May 2020 from the authorised capital account of 2020 or which could be subscribed on the basis of the option and conversion rights granted since 29 May 2020 or on the basis of conversion duties also established since that time, if - upon utilising the authorised capital account or upon the granting of the warrant-linked and/or convertible bonds, the shareholder’s pre-emptive rights would be excluded pursuant to or consistently with § 186 (3) sentence 4 AktG. Also added to the maximum threshold is the pro rata amount of the registered share capital attributable to treasury (own) shares, which the Company has bought back since 29 May 2020 on the basis of the authorisation granted pursuant to § 71 (1) no. 8 AktG and have been sold to third parties in exchange for a cash payment without having granted a shareholder pre-emptive right, unless the sale was carried out either on the open stock market or based on a public offer made to the shareholders;
  • to the extent it would be necessary to grant to the holders of conversion or option rights under any convertible or warrant-linked bonds a subscription right, to which they would be entitled as shareholders after having exercised a conversion right or option right or after having discharged a conversion duty;
  • for capital increases in exchange for the non-cash capital contributions, specifically for purposes of acquiring companies, divisions of companies and equity holdings.

Pursuant to a shareholder resolution adopted on 29 May 2020, the registered share capital was increased conditionally by up to EUR 1,117,500 (Conditional Capital Account 2020). The conditional capital increase must carried out only to the extent that the creditors, to whom convertible or warrant-lined bonds were issued by the Company on the basis of the authorising resolution of the Shareholders’ Meeting on 29 May 2020, exercise their conversion rights on or before 28 May 2025 and the Company has not satisfied the conversion claim in some other manner. The new shares will be entitled to draw dividends as of the beginning of the fiscal year in which they are issued. The Executive Board is authorised, with the consent of the Supervisory Board, to stipulate the details concerning the implementation of the respective conditional capital increase.

Pursuant to the shareholder resolution adopted on 29 May 2020, the Company was authorised to buy back its own shares in an amount representing a 10 percent pro rata amount of the registered share capital of EUR 223,500. The repurchased shares, together with the other treasury shares, which the Company has previously acquired and still holds or which must be attributed to the Company under § 71 a et seq. AktG, cannot exceed 10 percent of the Company’s registered share capital. The authorisation is in effect until 28 May 2025. The shares purchased on the basis of the authorisation may be used for all legally permissible purposes.

The authorisation to buy back the Company’s own shares was granted to the Company in order, inter alia, to flexibly adjust the equity capital to meet the changing business needs and to be able react to favourable stock market conditions. In addition, the acquired shares may be used as consideration when acquiring companies or when making equity investments in companies.

On the reporting date, the Company did not hold any treasury shares.

To the Company’s knowledge, as of 31 December 2020, the following shareholders held more than 10 percent of the Company’s registered share capital:

  • Peter Bollenbeck, Düsseldorf, Germany (35.14%), thereof 17.00% direct, 18.14% indirect via InVision Holding GmbH
  • InVision Holding GmbH, Düsseldorf, Germany (18.14%)
  • Matthias Schroer, Maurach, Austria (11.32%)
  • Investmentaktiengesellschaft für langfristige Investoren TGV, Bonn, Germany (10.08%)
  • Armand Zohari, Bochum, Germany (10.00%)

Executive Board members are appointed and dismissed in accordance with §§ 84 et seq. of the AktG.

According to Section 6 (1) sentence 1 of the articles of association, the Management Board consists of at least one person. Alternative members of the Executive Board may be appointed. Pursuant to § 6 (2) of the articles of association, the Supervisory Board is responsible for determining the number of, and appointing the regular Executive Board members and alternate Executive Board members and has the authority to revoke such appointments. The Supervisory Board is also responsible for selecting a member of the Executive Board to serve as that body’s chairman and for selecting other Executive Board members to serve that body’s deputy chairmen. § 8 sentence 2 of the articles of association specifies sole representation if only one member of the Executive Board has been appointed.

Amendments to the articles of association are adopted by the Shareholders’ Meeting if, in accordance with § 179 AktG, a majority of at least three-quarters of the registered share capital represented at the meeting votes in favour of the amendment.

Pursuant to § 10 (2) of the articles of association, the Supervisory Board is authorised to amend the articles, provided the amendment involves only the wording. Pursuant to § 21 (1) of the articles of association, the shareholder resolutions require a simple majority of the votes cast, unless the laws prescribe another majority. In those cases in which the laws require a majority of the registered share capital represented at the time the resolution is adopted, a simple majority of the represented registered share capital will suffice, unless the laws prescribe a higher majority.

There are no significant agreements which are subject to a restriction relating to a change of control resulting from a takeover offer. Likewise, no agreements for indemnifying employees or members of the Executive Board in the event of a takeover offer have been reached.

General Business Conditions

According to the International Monetary Fund, the economic output in the euro area decreased by 7.2 percent in 2020 and 3.4 percent in the United States. According to Bitkom Research GmbH, the market for information technology decreased by 0.7 percent during 2020.

Business Development

The most significant financial performance indicators of the InVision Group are the Group revenues and the EBIT margin (ratio of consolidated earnings before interest and taxes as a percentage of revenues). Due to the Group’s business model, a positive or negative development of these performance indicators has a correlating effect on the development of the net assets and financial position.

Results of operation

During the reporting year, consolidated revenues increased by 1 percent to TEUR 12,752 (previous year: TEUR 12,618). The Company merged the development and sales organisations of the two product areas “Workforce Management” and “Education” in the second half of 2020 and therefore no longer publishes the respective revenue shares.

Other operating income decreased by 51 percent to TEUR 65 (previous year: TEUR 133).

Personnel expenses increased by 7 percent to TEUR 8,703 in the reporting year (previous year: TEUR 8,162). The personnel expenses ratio thus amounts to 68 percent (previous year: 65 percent).

Depreciation of intangible assets and property, plant and equipment decreased by 10 percent to TEUR 663 (previous year: TEUR 737). Of the reported depreciation and amortisation, TEUR 188 (previous year: TEUR 182) relate to the rights of use from leasing contracts to be capitalised under IFRS 16 since the beginning of the 2019 financial year.

Other operating expenses decreased by 19 percent to TEUR 2,316 in the fiscal year 2020 (previous year: TEUR 2,868) and thus represent 18 percent in relation to the consolidated revenues (previous year: 23 percent). This development essentially reflects the financial consequences of the Company’s measures in response to the Covid-19 pandemic. The Group’s business premises were temporarily closed to protect the workforce. Travel activities were scaled back to a minimum. Business operations were maintained in a remote setup without interruption. Services for customer projects were also provided exclusively remotely.

Expenses for cloud services increased by 1 percent to TEUR 768 (previous year: TEUR 762). The expenses for online advertising activities reported under cloud services until the last financial year were reclassified to marketing expenses. For reasons of better comparability, the prior-year comparative figures have been adjusted and TEUR 44 reclassified accordingly. At TEUR 447, consulting expenses were 10 percent higher than in the previous year (previous year: TEUR 407). Office space expenses decreased by 21 percent to TEUR 293 (previous year: TEUR 370), which is mainly due to the temporary termination of the leased office space for InVision Software Inc., Chicago, USA, and the temporary closure of the other offices of the InVision Group. Marketing expenses decreased by 4 percent to TEUR 223 (previous year: TEUR 233). Travel expenses decreased by 79 percent to TEUR 78 (previous year: TEUR 366). Recruitment costs increased by 10 percent to TEUR 75 (previous year: TEUR 68). Other personnel expenses fell by 65 percent to TEUR 58 (previous year: TEUR 166) and mainly relate to staff catering. Communication expenses fell by 39 percent to TEUR 55 in the reporting year (previous year: TEUR 90).

The operating result (EBIT) for the reporting period amounts to TEUR 1,135 and is 16 percent above the previous year (TEUR 981). The EBIT margin rose to 9 percent (previous year: 8 percent).

At TEUR 107, interest expenses were on the previous year’s level (previous year: TEUR 108). This is mainly due to a commitment loan of TEUR 6,000 that was taken out in 2018, of which TEUR 5,000 was drawn down in the fiscal year (previous year: TEUR 1,000). According to IFRS 16, lease payments are divided into repayments and interest payments. The interest portion was recognised accordingly in the income statement under interest expense.

Taxes on income and earnings show a total amount of TEUR -614 (previous year income: TEUR 2,106). On the one hand, this includes tax expenses of TEUR -112 for taxes on profits of the companies injixo AG, Zug, Switzerland, InVision Software SAS, Paris, France, InVision Software Ltd., London, United Kingdom, and InVision Software B.V., Utrecht, Netherlands. In the opposite direction, income of TEUR 185 was recognised for the loss carryback of InVision AG, Düsseldorf.

On the other hand, expenses for the release of deferred tax assets of TEUR -687 were recognised in the income statement. This was mainly based on the intra-group sale of software licences for workforce management from injixo AG, Zug, Switzerland, to InVision AG, Düsseldorf, in the amount of TEUR 11,500. In 2019, the transaction led to the capitalisation of intangible assets in the financial statements of InVision AG, Düsseldorf, and thus to a temporary difference between the consolidated balance sheet and the commercial/tax balance sheet, for which deferred tax assets of TEUR 3,450 had to be recognised. These will be reversed pro rata temporis up to and including 2024 in line with the corresponding useful lives of the licenses.

In the financial year 2020, the consolidated net income amounts to TEUR 372 (previous year: TEUR 2,995). Earnings per share amount to EUR 0.17 (previous year: EUR 1.34), based on an average of 2,235,000 shares (previous year: 2,235,000 shares).

Overall, and despite the global impact of the Covid-19 pandemic, revenue development and thus also business performance in 2020 were in line with expectations.

Net assets and financial position

The liquid funds increased by 198 percent to TEUR 7,791 as of 31 December 2020 (previous year: TEUR 2,616). The commitment loan totaling TEUR 6,000, which was taken out in 2018, was fully drawn down in the fiscal year by calling TEUR 5,000 (previous year: TEUR 1,000).

As of the balance sheet date, trade receivables were at TEUR 995, and thus 14 percent below the comparable prior-year figure (previous year: TEUR 1,159). Income tax refund claims increased to TEUR 367 (previous year: TEUR 44). In addition to InVision AG, these relate to the subsidiaries in France and the United Kingdom. Prepaid expenses and other current assets amounted to TEUR 240 (previous year: TEUR 136). In the year under review, intangible assets went down by 17 percent to TEUR 247 (previous year: TEUR 298). Property, plant and equipment totalled TEUR 8,573 (previous year: TEUR 8,937). The rights of use for leased office space in Leipzig and Paris recognised in accordance with IFRS 16 amount to TEUR 1,384 (previous year: TEUR 1,522). Deferred tax assets decreased by 20 percent to TEUR 2,794 (previous year: TEUR 3,481). The intra-group sale of software licenses in fiscal year 2019 led to the capitalisation of intangible assets in the financial statements of InVision AG, and thus to a temporary difference between the consolidated balance sheet and the commercial/tax balance sheet, for which deferred tax assets had to be recognised. These will be reversed pro rata temporis up to and including 2024 in line with the corresponding useful lives of the licenses. As in the previous year, other non-current assets exclusively comprise security deposits paid for rented office space.

The available commitment loan of TEUR 6,000 was fully utilised in the fiscal year by drawing down TEUR 5,000 (previous year: TEUR 1,000). This loan was taken out to refinance investments and to make further investments, and was reported in the balance sheet as current and non-current financial liabilities in accordance with their maturities. Since the third quarter of 2020, the loan has been repaid quarterly in the amount of TEUR 240 each.

Trade payables fell by 42 percent to TEUR 94 as of the balance sheet date (previous year: TEUR 162). Provisions fell by 13 percent to TEUR 209 (previous year: TEUR 239).

Income tax liabilities decreased by 32 percent to TEUR 817 (previous year: TEUR 1,202). These relate primarily to injixo AG, Zug, Switzerland, and InVision AG, Düsseldorf.

Customer contract liabilities and other current liabilities decreased by 1 percent to TEUR 849 (previous year: TEUR 859).

Reserves amounted to TEUR 1,191 at the end of the reporting period (previous year: TEUR 1,191). The consolidated balance sheet result amounts to TEUR 10,474 (previous year: TEUR 10,102).

As of 31 December 2020, the balance sheet total equalled TEUR 22,398 (previous year: TEUR 18,214). Equity capital was at TEUR 13,413 (previous year: TEUR 13,125), and the equity ratio equalled 60 percent (previous year: 72 percent).

Basic Principles of the Compensation System

The members of the Company’s Supervisory Board are paid a fixed fee of EUR 12,500. The Chairman of the Supervisory Board receives twice that amount, and the Deputy Chairman receives one and one-half times that amount. The fee is paid at the latest by the end of the fiscal year.

The Executive Board compensation consists of a fixed-base salary as well as an allowance to cover their costs for health insurance and long-term care insurance. Moreover, the Company has executed a D&O insurance policy with a deductible.

Risk Report

For the InVision Group, a comprehensive and self-contained risk management programme is a significant component of the Group’s corporate strategy. A company-wide monitoring system ensures the systematic identification and assessment of risks regarding any likelihood of occurrence or the possible quantitative effects on corporate value.

Risk management is intended to identify, at an early stage, specifically any risks which threaten the Company’s very existence in an effort to launch effective counter-measures for avoiding the risks. Another goal is to minimise the possible adverse effects, which all risks could have on the net assets, financial position and results of operation, while largely preserving the corresponding opportunities.

Potential counter-measures for dealing with risk include, for example, avoiding high-risk activities, reducing individual areas of potential risk by utilising commercial alternatives with a lower potential for risk, diversifying and limiting individual risks, and shifting risks onto insurance carriers or contracting parties.

The Executive Board is responsible for administering the risk management. A fundamental review of all risks is made once each year, at least. There are standardised accounting rules used in the Group’s companies, the compliance with which is continuously monitored. This also guarantees that the accounts conform to the standard accounting rules applicable from time to time. An internal ad hoc report is prepared in the event that there are significant changes or newly emerged risks. All risk-relevant topics and the then-current economic situation over time are constantly monitored. If necessary, operational teams or external experts are called in to participate.

The risk management is described and detemined in a group risk management policy.

InVision depends on seasoned and well-trained teams of employees. The future success of InVision will also depend on finding and retaining, on a long-term basis, highly qualified employees. The competition for employees with scientific, technical or industry-specific expertise is quite intense. It is therefore possible that the Company will be unable to promptly recruit new staff on the open labour market and that this may give rise to additional costs. The loss of qualified staff or long-term difficulties in hiring suitable employees could result in InVision’s inability to successfully implement important decisions and courses of action, which in turn would impair its business operations. This particularly applies in the case of a zombie apocalypse.

In favour of the introduction of new product categories, InVision has given only secondary priority to the support of existing customers in recent years. This has had a negative impact on the overall satisfaction of these customers. It is thus possible that existing customers switch to products from InVision’s competitors, meaning that the previous sales streams are drying up sustainably. Unless InVision succeeds in stabilising customer satisfaction at a high level, this can have a permanently negative effect on the business activities.

The methods, processes and technologies used by InVision to date for introducing workforce management products had resulted in disproportionately long introduction cycles and often incompletely used functionality. This can result in customers experiencing only limited value from continuous use during or after the product launch, and subsequently deciding to discontinue the use of the product, so that existing revenue streams dry up sustainably and the possibility of establishing new revenue streams is restricted. If InVision does not succeed in changing the methods, processes and technologies used to date to introduce products to customers in such a way that customers quickly and permanently achieve a high value from the use of the products, this could have a lasting negative impact on its business activities.

The management of risks takes particular importance in times of the Covid-19 pandemic. Based on the current analysis, however, the risk structure of the InVision Group has not changed significantly compared to the previous fiscal year, even though the general risk of bad debts has generally increased as a result of macroeconomic developments. Measures have been taken to protect the workforce and to maintain business operations.

The aforementioned risks, both individually and collectively, could have adverse effects on the net assets, financial position and results of operation of the Company and of the InVision Group as a whole.

Compliance Statement

The current statement according to §161 AktG, the current statements on corporate governance practices, the operating principles followed by the Executive Board and the Supervisory Board as well as the composition and operations of their committees are available on the Company’s website under “Corporate Governance” at

Forecast Report & Opportunities

Anticipated global economic development

According to the forecasts made by the International Monetary Fund, the economic output in the euro area will increase by 4.2 percent in 2021, whereas the economic output in the United States will increase by 5.1 percent. According to the forecast made by Bitkom Research GmbH, the market for information technology will grow by 4.2 percent in 2021.

Anticipated development of InVision

From 2018 to 2020, we have repositioned InVision across all divisions, creating the structures for sustainable business growth. We operate a highly scalable business model, have an excellent strategic starting position and significant untapped growth potential with numerous growth options.

We therefore plan to invest significantly in the expansion of our business activities over the next five years. A key part of the investment program is the recruitment of up to 400 additional employees in all business areas. For 2021, the focus will be on the massive expansion of capacities in customer service and related areas. We expect that the investments will temporarily result in a negative EBIT, both in 2021 and 2022, of up to minus EUR 6 million in total. EBIT performance is therefore the key performance indicator for 2021. As a result, we expect sustainable average growth rates of at least 30 percent per year from 2022 to 2025. In 2025, we expect annual revenues of more than EUR 50 million and an EBIT margin of more than 25 percent.

We plan to establish an employee participation program in 2021 to improve the recruitment and long-term retention of highly qualified employees. We also reserve the right to examine options for a capital increase for further funding of growth in the course of 2021.

Düsseldorf, 19 March 2021

Peter Bollenbeck