28 Segment reporting

For management purposes, SoftwareONE is organized by geographical areas. The following regional clusters are the group’s operating segments:

EMEA (Europe and South Africa);
NORAM (US, Canada);
LATAM (Latin America);
APAC (Asia Pacific, including India and Dubai).

No operating segments have been aggregated to reportable segments.

The Executive Board (CEO, CFO, COO, President of Sales and President of Services) is the Chief Operating Decision Maker (CODM) and assesses each of the reported segments separately for the purpose of evaluating performance and allocating resources. Gross profit and EBITDA are the key performance indicators used for internal management and monitoring purposes of the group and are reported as segment results. The group allocates revenue and expenses to regions based on the customer’s headquarter domicile since the region is responsible for the global client relationship. There are no intersegment revenues. Different average exchange rates are used in management reporting than for group consolidation purposes.

The group’s financing (including finance income and finance costs) and income taxes are managed on a group basis and are not allocated to the operating segments.

The segment totals are reconciled to the figures reported in the consolidated income statement (column 'Total') as follows:

The column 'Corporate' includes the group cost centers such as management and shared service costs. The column ‘FX & Consolidation’ eliminates the effect of using different average foreign exchange rates in the segment reporting and consolidation effects. The column 'Other' includes other reconciling items that are not allocated to the segments and corporate in internal reporting such as share-based payment plans (with the exception of LTIP and ESPP), earn-outs and integration costs as well as differences in accounting policies of IFRS 16 which are not reflected in the segment reporting. Additionally, the column 'Other' includes a reclassification of bad debt provisions which are presented in gross profit in the internal reporting but in operating expenses in the consolidated income statement.

Segment disclosure 2021

in CHF 1,000	EMEA	NORAM	LATAM	APAC	Total segments	Corporate	FX & Consoli- dation	Other	Total

Total revenue (external)	606,247	137,057	98,876	116,515	958,695	–	321	5,337	964,353
Third-party service delivery costs	–77,108	–10,203	–10,346	–10,069	–107,726	–2,344	1,251	–462	–109,281

Gross profit 1)	529,139	126,854	88,530	106,446	850,969	–2,344	1,572	4,875	855,072
Personnel expenses and other operating expenses/income	–310,002	–84,131	–71,722	–69,898	–535,753	–107,499	–532	–51,109	–694,893

EBITDA 2)	219,137	42,723	16,808	36,548	315,216	–109,843	1,040	–46,234	160,179

1) Total revenue net of third-party service delivery costs.

2) EBITDA from segment reporting reconciled to earnings before net financial items, taxes, depreciation and amortization.

The most relevant reconciliation items in the column ‘Other’ were related to:

in CHF 1,000	Share-based payment expenses	Earn-out expenses	Integration and M&A expenses	'Transformance' expenses	IFRS 16 leases	Bad debt provisions	Acquisition of HeleCloud & Centiq	Remaining	Total Other

Total revenue (external)	–	–	–	–	–	366	6,353	–1,382	5,337
Third-party service delivery costs	–	–	–	–	–	–	–501	39	–462

Gross profit 1)	0	0	0	0	0	366	5,852	–1,343	4,875
Personnel expenses and other operating expenses/income	–13,026	–26,888	–9,414	–9,757	17,522	–366	–6,153	–3,027	–51,109

EBITDA 2)	–13,026	–26,888	–9,414	–9,757	17,522	0	–301	–4,370	–46,234

1) Total revenue net of third-party service delivery costs.

2) EBITDA from segment reporting reconciled to earnings before net financial items, taxes, depreciation and amortization.

Segment disclosure 2020

in CHF 1,000	EMEA	NORAM	LATAM	APAC	Total segments	Corporate	FX & Consoli- dation	Other	Total

Total revenue (external) 1)	572,905	108,583	61,033	86,698	829,218	–	–8,734	11,916	832,400
Third-party service delivery costs 1)	–88,076	–5,036	–10,174	–5,522	–108,809	–1,102	7,597	–466	–102,780

Gross profit 2)	484,829	103,546	50,858	81,176	720,409	–1,102	–1,137	11,450	729,620
Personnel expenses and other operating expenses/income	–272,344	–66,971	–37,694	–53,680	–430,689	–85,075	264	–26,144	–541,644

EBITDA 3)	212,485	36,575	13,164	27,496	289,720	–86,177	–873	–14,694	187,976

1) Prior-year figures restated, refer to Note 2 Change in accounting policies.

2) Total revenue net of third-party service delivery costs.

3) EBITDA from segment reporting reconciled to earnings before net financial items, taxes, depreciation and amortization.

The most relevant reconciliation items in the column ‘Other’ were related to:

in CHF 1,000	Share-based payment expenses	Earn-out expenses	Integration expenses	IFRS 16 leases	Bad debt provisions	Acquisition of InterGrupo	Remaining	Total Other

Total revenue (external)	–	–	–	–	6,244	5,920	–248	11,916
Third-party service delivery costs	–	–	–	–	–	–466	0	–466

Gross profit 1)	0	0	0	0	6,244	5,454	–248	11,450
Personnel expenses and other operating expenses/income	–24,025	–4,084	–4,791	16,850	–6,244	–4,194	344	–26,144

EBITDA 2)	–24,025	–4,084	–4,791	16,850	0	1,260	96	–14,694

1) Total revenue net of third-party service delivery costs.

2) EBITDA from segment reporting reconciled to earnings before net financial items, taxes, depreciation and amortization.

Additional geographical information

Switzerland, the US, Germany and the Netherlands are the main geographical markets for SoftwareONE and represent approximately 52% (prior year: 55%) of total revenue. Revenue is reported based on the customer's headquarter domicile:

2021
in CHF 1,000	Germany	US	Netherlands	Switzerland	Other countries	Total

Revenue (external)	215,516	129,232	92,284	66,735	460,586	964,353
Non-current assets	183,797	25,586	108,597	95,320	234,525	647,825

2020
in CHF 1,000	Germany	Netherlands	US	Switzerland	Other countries	Total

Revenue (external) 1)	196,142	106,093	101,762	56,423	371,980	832,400
Non-current assets	210,498	101,203	16,511	82,710	164,467	575,389

1) Prior-year figures restated, refer to Note 2 Change in accounting policies.

No transactions with one single external customer exceed 10% of consolidated revenue of the group.

Non-current assets for this purpose consist of tangible, intangible assets, right-of-use assets and investments in associated companies and are allocated based on the location of the group company.