Looking ahead – Projection of 2009

We are currently finalizing the budget for 2009, which is looking very promising.

This will be communicated in the next Investor Newsletter after the Board has approved this later this month. We are taking into consideration the difficult business environment looming for 2009, but our value proposition is to help big brands saving money by implementing global marketing campaigns “the new way” through our proven SaaS software; Brand master attached with our professional services on smart online and offline ad templates creation. We have seen examples of companies cutting 70 % of their ongoing software
projects, but increasing their effort on implementing our Brand master Software to be more cost efficient on a day to day basis. The global rollout of Brand master for the Daimler Group is a great reference and we have invested in more senior software sales staff in the UK to capture the opportunity we foresee in 2009.
Overall, we have 50 major customers and over 15.000 marketing executives worldwide using the system.

Our service department on the creative side has very strong relationships towards Universal, Paramount, EA, and many others. The latest additions in our portfolio are Sony Play station, Harrods and Vodafone.

Vertical Group ASA has already almost secured the entire Q1 2009 budget cash flow for approximately NOK 20 Mill. We are targeting towards 2009 an overall 30 % growth versus 2008 levels, with a 20 % operating profit.
We are currently in discussions with industrial players as well as our AIM brokers with the objective to seek exit opportunities for Vertical Group shareholders within 2009.

Hard work pays off

Vertical Group ASA has had a very eventful year in 2008.
We decided to stop our planned IPO towards Oslo Access in January, due to the current market conditions and our future market predictions.
In retrospect, we believe it was the right decision.
We managed to complete the 100% purchase of the Norwegian software company T4M, which was a key piece in our overall strategy.
In April, we also raised additional capital to remove all debts occurring from the previous IPO process.
We have now a complete Due Diligence legal and financial trail, provided by Selmer and PwC for all entities of Vertical Group ASA.
We also adopted all historic accounts for the group towards IFRS and set up processes in order to enable us to continue under the same standard with monthly reporting.

Vertical Group ASA has a signed mandate letter with UK broker HB Corporate for a potential AIM listing. This means that
we can fast track for IPO, when the timing is right. We have done appropriate management and employee
replacements throughout our entities during 2008. The ambition of Vertical Group was, for the year 2008, to have integrated all the companies with cost efficient internal processes, drive synergies, have motivated staff, satisfied customers, 100 % cost control and positive cash flow on monthly basis. We are happy to say that we now have achieved all these goals.

The second half of this Year will be profitable within the entire Vertical Group, with Q4 confirming the increasing performance trend.
Please find below a graph showing the development of the Group throughout 2008.

Quarterly Results Vertical Group 2008