Annual Report 2012.pdf - Cherry

annUal report 2012
CHerry

Cherry turns 50 – and is reborn!
This year Cherry celebrates 50 years of successful gaming. For over half a century we have
responsibly been supplying our players with fun and exciting games. In recent years Cherry has
undergone important changes and taken a big step towards securing further profitable growth.
RESTAURANT CASINO
Part 1
About Cherry
Report from the CEO 4
Cherry – 50 year anniversary 6
Cherry’s vision 11
Online Gaming 12
Resturant Casino 14
Development Project 16
The share 18
Executives and management 20
50 years in the
services of players
As we know, Cherry is 50 this year.
Follow us on an exciting journey
that started in 1963 and still
continues today.
PAGE 6
Cherry’s lead is increasing
Thanks to working with procedures
and strategic acquisitions, Cherry
has increased the number of venues
and turnover per table.
PAGE 14
But we are far from satisfied.
– Emil Sunvisson, CEO
HISTORY ONLINE GAMING
Part 2
Annual Report
Introduction 21
Administration report 22
Group 28
Parent Company 32
Notes 36
Signatures 60
Auditor’s Report 61
Definitions 62
DEVELOPMENT PROJECTS
Cherry is playing to win
The foundation for further profitable
growth has been laid with the launch
of our own gaming platform.
PAGE 12
New gaming company with
innovative number games
Yggdrasil supplies innovative and exciting
number games on the internet,
which are sold to different operators.
PAGE 16

PART 1 REPORT FROM THE CEO
Report from the CEO:
Cherry turns 50
– and is reborn!
This year Cherry celebrates 50 years of
successful gaming. For over half a century
we have responsibly been supplying our
players with fun and exciting games.
In the recent year Cherry has undergone
important changes and taken a big step
towards securing further profitable growth.
But we are far from satisfied.
– Emil Sunvisson, CEO
4 | cherry 50 years
The traditional gaming operations onboard
ships have been sold, the cooperation regarding
the Automaten sites has been discontinued
and the trademarks have been sold. Cherry
now has Sweden’s best Restaurant Casino, a
completely new and modern platform that
we have developed for Online Gaming and
solid financial base. It is no overstatement to
say that after 50 years, Cherry is now facing
yet another new chapter.
With the right technology, competence and
resources, we are now focusing on creating
growth with exciting products and an growth
oriented marketing strategy.
NEW BUSINESS MODEL IN ONLINE GAMING
In November 2012 we launched Euro-
Slots.com, the platform we have developed for
Online Gaming, with our own gaming licence
in both Malta and Schleswig-Holstein. This
platform means that in addition to appear-
ance and functionality, we have full control
over our customers and product offerings.
The switching of our business model from
white label to our own platform means that
we can radically reduce variable costs, which
gives us the opportunity to achieve higher
margins with greater volumes.

The sale of the Automaten sites (Sverige-, Norges- and
DanmarksAutomaten) was completed earlier this year. It
has created a lot of value for Cherry’s shareholders and has
given us the financial strength we need to be successful as a
leading and independent operator. We are also very pleased
about the acquisition of one of the oldest online casinos –
CherryCasino.com – which obviously belongs at home with
us at Cherry.
Through the investment in Yggdrasil Gaming (read more
on page 16), Cherry has taken a further step in the development
of the exciting number games on the net. During the
year we will be launching several new exciting ventures to
create additional growth in Online Gaming.
Many of our competitors would
like to be in our place right now,
with a new platform based on the
latest technology combined with
significant market resources.
RAISING THE STAKES
Cherry continues to take market shares in the business
area Restaurant Casino. In 2012 we acquired an additional
three operators and once again succeeded to achieve growth
in a shrinking market.
Cherry has been campaigning for several years for a
review of gaming legislation and to increase the maximum
stake at tables. It now seems as if we have gained some
attention. Jan R Andersson (Conservative) who is a member
of the Swedish Parliament has submitted a motion to
increase the stakes, which will be considered by the Ministry
of Culture this spring. We estimate that an increase in the
stakes to SEK 200 at Blackjack will create 1 000 new jobs in
the industry, primarily in the 18–25 age group.
SOCIAL RESPONSIBILITY IS PART OF CHERRY’S BUSINESS CONCEPT
Social responsibility is extra important for Cherry as a
private gaming operator. We want to act responsibly, both
in relation to society by sponsoring teams, associations
and Swedish culture, and also towards our customers by
allowing players to easily set limitations to their playing.
Social responsibility is an integral part of our corporate
culture.
NARROWER AND STRONGER FOCUS
In October 2012 we completed the sale of the business
area Maritime Gaming. Our assessment was that the
opportunities for growth and satisfactory profitability in
Maritime Gaming are limited in the near future. Maritime
Gaming has been one of Cherry’s core business operations
for a long time, with many experienced and competent
employees. For Cherry this disposal means a strong
improvement in liquidity and increased focus on the growth
area Online Gaming.
LEGAL ACTION AGAINST NORWEGIAN GOVERNMENT
EuroLotto has been a much appreciated alternative to the
government lotteries, but not equally popular with the
old school monopolists. During the year we have issued a
lawsuit against the Norwegian government, which demands
that Cherry should close its offer of gaming for money at
EuroLotto.com.
We consider that the injunction is invalid, partly because it
is directed against Cherry AB in Sweden, which is the wrong
addressee, and also because it lacks legal grounds and conflicts
with the regulations in the EEA agreement concerning
free movement of products and services.
The Norwegian government is attempting with unjust
means to protect its monopoly and make it more difficult
for Norwegian players to turn to private providers. The
government is acting outside of its jurisdiction and
attempting to prohibit foreign companies from offering
Norwegians services that are lawful in Norway.
Cherry’s subsidiary intends to continue to offer the
opportunity to play EuroLotto for players in Europe – including
Norway.
A LIVELY FIFTY YEAR OLD
Cherry celebrated the jubilee year in grand style by gathering
nearly 500 capable, committed and party-hungry colleagues
to celebrate the lively fifty year old. It was a party we will
certainly not forget for a long time. We also congratulated
all the great colleagues who won prizes, especially the Best
Croupier in the Universe.
2013 HIGHLIGHTS THE START OF THE NEW CHERRY
The sale of the Automaten sites and the major investments
in the launch of new products in new markets means that
2013 will be different from previous years. I believe that the
investments will result in increased growth, but that the
business area Online Gaming will show poorer margins for
some time.
We are laying the foundation in 2013 for many years of
further profitable growth. Many of our competitors would
like to be in our place right now, with a new platform based
on the latest technology combined with significant market
resources.
We have made a lot of progress in just a couple of years.
A few years ago Cherry was running Restaurant Casino
and Maritime Gaming without particularly large funds.
Today we are one of the fastest growing companies in
Europe in Online Casino, with powerful resources to say
the least.
Newly
painted
Emil inspects the rooms at
Cherry’s new head office at
Blekholmstorget in Stockholm.
cherry 50 years |
5

PART 1 CHERRY – 50 YEAR ANNIVERSARY
6 | cherry 50 years
50 YEARS IN
THE SERVICES
OF PLAYERS
As we know, Cherry is 50 this year. It’s been 50 years
lined with great success, some misfortune – but above all –
fun & excitement. Follow us on an exciting journey that
started in 1963 and still continues today.
T
he year is 1963. A year that held many important
events. The Beatles released their first
album, the first James Bond film opened at
the cinema, John F Kennedy was assassinated in
Dallas and the Swedish Parliament introduced a
new law on four weeks holiday.
AB Restaurang Rouletter was founded on the
Saint Lucia Day, December 13, that very year by Bill
Lindwall and Rolf Lundström. It was the beginning
of the company that today, 50 years later, is called
Cherry and has experienced both impressive
success and tough setbacks.
The name clearly shows that the company was
engaged in roulette at restaurants. They mainly
had customers in central and southern Sweden,
and there were lots of students who wanted parttime
jobs as croupiers at their tables.
Two of these students, Per Hamberg and Lars
Kling, were keen on starting a company and trying
their own luck, with their main focus on northern
Sweden. The two companies were competitors for
some years, but in 1968 they decided it was better
to join together and work under the same flag.
Cherry was launched in 1972 as the name for
the joint company and the now famous cherries
began to be used as the logotype. The company
was ready to face new challenges and opportunities
– with a business concept based on fun & excitement
and responsibility.
The slot machine era
In 1972 Cherry began to understand what was
coming. So when a law came out the next year
that allowed slot machines at restaurants that has
licences to serve alcohol, Cherry was considerably
better equipped than its competitors.
Which soon proved to be the case – in a short
time Cherry took over half of the slot machine
market in Sweden. It became a nationwide company,
with offices in Solna, Gothenburg, Umeå
and Malmö. With the help of many young, newly
recruited, ambitious persons who received a lot of
freedom to take action.
from top left
roulette in the 60s
online gaming on a tablet 2012
entertainment in the 70s
branded slot machine
hi-tech anno 1978
cherry’s chips 2013
80s at casino orbis in poland

cherry 50 years |
7

PART 1 CHERRY – 50 YEAR ANNIVERSARY
19
63
8 | cherry 50 years
The 70s were a period of fantastic success for
Cherry – and at the same time a lot of hard work
to keep competitors at bay. Good service and competent
staff have been important components in
Cherry’s business concept from the very beginning.
Something that has been significant in maintaining
the lead in relation to competitors.
This was matched with curiosity and the thrill of
discovery – what was round the corner? What new
forms of gaming could be interesting and successful
in the time ahead?
The driving force to keep on thinking ahead led
Cherry to initiate cooperation in 1974 with a small,
newly started electronics company in California.
This company was Atari, a partner who undeniably
proved to be focused on future gaming experiences.
The successful era of slot machines came, however,
to an abrupt end. A decision was taken in 1978
to prohibit slot machines in Sweden. The decision
came into force on 1 January 1979 and Cherry had
to spend a lot of energy, time and money to change
the organisation and operations to the new gaming
regulations on the market.
Gaming on boats – and outside Sweden
A slimmer organisation began to look for new
business opportunities after the prohibition of
slot machines came into force. About 5 000 slot
machines stood along the walls in a warehouse in
the south of Stockholm.
Soon enough they came to the conclusion
that there ought to be possibilities of using the
machines in other places. Cherry had already begun
to widen operations outside the borders of Sweden,
AB Restaurang Rouletter was
founded by Bill Lindwall and Rolf
Lundström. It operates mainly in
southern and central Sweden.
19
68
19
72
19
73
Cooperation is established with AB Roulett
konsult & Spelautomater founded by Per
Hamberg and Lars Kling. The business
operation is now nationwide.
New legislation enables licensed
restaurants to provide slot machines
with winnings in Swedish kronor.
The Cherry name and the
cherry symbol are registered.
19
78
with organised branches in England, Norway and
Denmark. Moreover, Cherry was involved in casino
operations in Cadiz in Spain and in Majorca, with
agreements for slot machines with more than a
thousand bars and public places.
It also became clear that several Eastern European
countries were in a phase that was suitable for
the launch of slot machines on a broad front. For
several years successful operations were developed
in what were Yugoslavia, Czechoslovakia, the Soviet
Union and Poland. The expansion in the east was
complicated, however, by such things as soaring
inflation and, even here, governments who put
obstacles in the way.
In parallel with foreign expansion, Cherry also
found business opportunities in another inter-
national arena, namely the boats sailing on
international waters. Most of these permitted slot
machines, just because they were on international
waters. The Maritime part grew quickly in Sweden
and also spread to the Mediterranean.
The Internet emerges
In 1997 hardly as many as two million Swedes aged
between 15–74 used the Internet more than once
a month. Today around six million Swedes use the
Internet daily.
But in 1997 the combination of curiosity and
vision made itself felt in Cherry once again. It was
then Pontus Lindwall (son of one of the founders,
Bill Lindwall) set up guidelines for gaming experiences
via the Internet. It was subsequently revealed
that others were on the same track, but Cherry was
once again an early starter in this venture. They took
19
84
Cherry is acquiring several former profit generating
Swedish gaming companies and is financing these
acquisitions with the issue of new shares. The foundation
for a new group is being created.
1986 –
1991
The Swedish Parliament takes a decision
to prohibit slot machines. The platform
for Cherry’s operations disappears during
the course of one month. An extensive
reorganisation is begun.
Cherry operates slot
machines and casinos in
several Eastern European
countries.
19
92
Developments in Eastern
Europe causes Cherry
extensive losses. The
board decides to focus
on core markets and
to trim or discontinue
investments in Eastern
Europe.

19
93
slot machines on the move in eastern europe in the 80s cherry on the road (1977)
the risk of investing in a business operation that
would experience a few difficult years before it bore
fruit and became profitable – especially because of
all the air that went out of the Swedish IT bubble
with such incredible force around the year 2000,
just as Cherry’s first Internet casino Cherry-
Casino.com was launched. The company Net
Entertainment started as a development project in
Cherry to meet the demand for slot machines on
the Internet.
The online business began quickly expanding
on its own and through fruitful cooperations. In
2003 Cherry invested in a small but promising
company called Betsson, which with Cherry’s help
Cherry is once
again profitable.
19
94
19
96
Cherry acquires Casino
Invest in Umeå and
thereby reinforces its
position in Norrland and
Gothenburg.
Cherry’s B-share was listed on the SBI list
(NGM Equity) on 26 March. A business
venture with the so-called wheel of fortune
starts in February. The Swedish Parliament
takes a decision to prohibit the wheel of
fortune from 1 January 1997. Cherry introduces
a new generation of games for the
Swedish restaurant and bingo markets.
19
98
Cherry acquires 35 percent
of Net Entertainment
AB.
19
99
quickly got things moving.
The technology was refined and made gaming
on the Internet increasingly more attractive. At the
same time a gaming boom spread over Sweden,
and playing on the Internet quickly grew from
something somewhat suspect to something just as
natural as sitting with a bag of crisps on the sofa
watching television on a Friday night.
As a result of the different operations that developed
it was decided that the operations in Cherry at
that time would be better off in separate companies,
and in 2006 the company was divided into Betsson,
Net Entertainment and Cherry.
20
00
20
01
Cherry acquires First Casino. Maritime Gaming
starts in the Mediterranean. A cooperation
agreement is signed with AB Svenska Spel
concerning value slot machines. Cherry
invests excess liquidity in IT companies,
primarily in the Internet sector.
Cherry acquires Kinnevik’s holding in Net Entertainment.
Payment is made through a special issue of shares, whereby
Kinnevik becomes the largest owner in Cherry. The parent
company’s B-shares are listed on the OM Stockholm
Exchange’s O-list on 22 June. Cherry launches a new logo.
Cherry is forced to implement cost
savings and to write down goodwill
in Net Entertainment.
20
02
20
03
Cherry buys into the English sport
gaming company Betsson.com. Cherry
signs a large agreement with Danish
Shell on the establishment of gaming
environments at petrol stations.
Cherry implements the only oversubscribed rights issue for
the year, which brings SEK 20 million for existing shareholders.
Net Entertainment sells its first CasinoModule to
Expekt.com. The cooperation agreement with Svenska Spel
concerning Jack Vegas is discontinued according to plan.
cherry 50 years |
9

PART 1 CHERRY – 50 YEAR ANNIVERSARY
20
04
20
05
20
06
10 | cherry 50 years
Restaurant Casino – a stable base
Right from the very beginning, 50 years ago,
Cherry was at that time a dominant player on the
market for Restaurant Casino in Sweden. And so it
has remained throughout the years.
On the side of business operations such as slot
machines, international ventures, maritime gaming
and online gaming, restaurant casino has existed
as a secure and stable base. It is basically built
on the same business concept today as in 1963, i.e.
to offer manned gaming tables for gaming experiences
at restaurants and other places of entertainment.
The staff are an important part of the business
concept, and Cherry is famous for its high
level of service and competent personnel.
After 50 years in the industry, Cherry is stronger
than ever and has a full 60 percent of the Swedish
market. Cherry continues to grow by taking venues
from competitors and through acquisitions.
But the prospects for operations have changed
through the years, partly from fluctuating trends in
entertainment, and partly from competition in the
form of other attractions. The regulations around
restaurant casino have also made life tougher for
Cherry, namely because stakes have not been increased
in line with rising costs. It is becoming
more and more difficult to earn money at restaurant
casino in Sweden today, and a large number of job
opportunities are threatened unless the rules are
changed.
20
07
Net Entertainment delivers a significant
number of Casino Modules to
international customers. Partly owned
Betsson.com achieves its commercial
breakthrough.
Net Entertainment develops
strongly. Cherry
acquires the outstanding
parts of Betsson.
Cherry launches the product
EventCasino. Betsson distributes
Net Entertainment to shareholders.
20
08
Cherry changes its name to Betsson and
distributes Cherry Casino to shareholders.
A new group is established and listed on
AktieTorget.
Cherry launches the gaming
site PlayCherry.com. Cherry
launches 11 boxer tables for
Blackjack and discontinues
land-based gaming in
Denmark.
20
09
20
10
Cherry – today – and in the future
The company that still prides itself in the stylised
cherries is obviously a completely different company
to the one started 50 years ago. But the emphasis
is still the same, to offer fun & excitement in a very
responsible way.
The winds of change are now blowing for us
to vitalise our operations and establish the foundation
for another 50 years of growth. Cherry’s
gaming services are now mainly to be found on
the Internet and in restaurants. The business area
Maritime Gaming was sold in the autumn of 2012,
thereby concluding a long and important era in the
company.
Several new ventures have been launched on the
basis of Cherry’s new gaming platform, including
the net casino EuroSlots, the mega lottery EuroLotto
and the re-launch of CherryCasino. No one will be
surprised if other exciting ventures emerge, for
the objective of achieving more growth in Online
Gaming.
The existence of private gaming companies has
been questioned regularly throughout the years,
which makes it even more important for Cherry
to emphasise its work with social responsibility.
Cherry wants to take a far reaching social responsibility
by sponsoring associations and culture and
by giving players the opportunity to easily limit
their playing. Social responsibility is an integral
part of Cherry’s corporate culture.
Cherry receives a gaming licence for Casino on the net in
Schleswig-Holstein. Cherry sold in February trademarks and
domains related to the Automaten Group to Betsson AB
(publ). The proceeds amounted to SEK 286.0 million. Cherry
acquired the gaming site CherryCasino.com in February.
20
11
Cherry acquires the Automaten
group and becomes a leading
player in online slot machines.
Cherry acquires Astral
Marine Services Ltd and
Joker Casino. It reinforces
its position during the
year as market leader
in restaurant casino in
Sweden.
Cherry launches Europe’s
largest lottery with daily draws,
EuroLotto.com and the affiliate
portal, CherryAffiliates.com.
20
12
2013
Cherry acquires City-, Snättringe- and
Göteborg Casino and sells the business
area Maritime Gaming. Cherry
receives its own gaming license on
Malta. A new in-house developed
gaming platform is launched in 2012,
EuroSlots.com, and a new logo sees
the light of day. Cherry
invests in Yggdrasil.

Cherry’s vision
Cherry should be a leading gaming operator on all markets where we are active.
BUSINESS CONCEPT
Cherry offers fun & excitement with
entertaining and exciting games in
a safe environment.
OVERALL STRATEGY
` To respect the players by offering
user-friendly, entertaining and
exciting games in a safe environment.
` Develop new business ideas where
gaming or related products/services
will contribute to a moment of fun
and excitement.
` Seek growth and profitability.
Growth shall be organic as well as
through acquisition.
` Work for a re-regulated gaming
market in Sweden.
` To operate games with extensive
social responsibility.
OVERALL OBJECTIVES
The following overall objectives should
be a guiding principle for group activities
seen over a business cycle.
` Cherry should grow faster than the
market.
` The growth rate of profits should
exceed 10 percent a year.
` The equity ratio should amount to at
least 30 percent.
` Dividend shall be 50 percent
of net profit.
cherry 50 years |
11

PART 1 ONLINE GAMING
Online Gaming:
New trademarks and new technology
– Cherry is playing to win
Cherry’s business model has undergone a significant change in the last year in
the transfer from white label in cooperation with partners, to operation based
on its own licence and platform. With a completely new and modern gaming
platform and extensive marketing resources, Cherry has laid the foundation
for many years of profitable growth in the future.
From now on future growth will be created from our own
platform, where Cherry has control over its customers, products
and offerings. With the right technology, competence
and resources the focus is now on creating growth with exciting
products and an growth focused marketing strategy.
EUROPE’S NEWEST GAMING EXPERIENCE
In November 2012 Cherry launched EuroSlots.com – a
new product focusing on Cherry’s core area – online slot
12 | cherry 50 years
machines. EuroSlots offers many innovative functions and
games, but what makes the venture especially interesting is
what cannot be seen from the outside. EuroSlots has in fact
been built up from the bottom on a completely new in-house
developed platform.
“After extensive development work it is extremely pleasing
to finally have launched EuroSlots.com on our own platform
with our own gaming licence,” says Marius Andersen, CEO
of Cherry Malta Ltd.

EuroSlots.com
Launched in November 2012
in seven different languages,
based on the platform developed
by Cherry. Offers online
slot machines with the focus
on user-friendliness.
CherryAffiliates.com
A separate portal for all our
competent affiliates, where
they can follow their own
results, collect marketing
material and take part in
campaigns.
With its own platform Cherry can create a completely
new flexibility, which among other things provides access
to new markets.
“We obtain better control over the product offering and
strong financial leverage with low variable costs, which over
time improves our margins.”
EuroSlots offers a wide range of the best games available
online. The platform is designed from the bottom up with
the help of the latest technology and is focused on simplicity
and security.
“EuroSlots has been developed with the player in the
centre and gives us the opportunity to connect in principle
all types of games. There is also well-integrated functionality
for responsible gaming, where players can set the limits
themselves.”
The platform is prepared to meet all the requirements set
in different markets. Europe is moving towards a patchwork
of regulations and a flexible platform that can be adapted to
current rules and regulations is an import factor for success.
JACKPOT WITH AUTOMATEN SITES
Cherry sold the Automaten sites (Sverige-, Norges- and
DanmarksAutomaten) in January 2013 for a total of SEK
286 million. This is a very substantial increase in Cherry’s
resources.
“The sale is an importance piece of the puzzle in the new
start of our operations on the Internet, where future growth
is created from our own platform,” adds Marius Andersen.
In conjunction with the sale of the Automaten sites Cherry
acquired the CherryCasino.com site. This will be incorporated
in the EuroSlots platform and consists of an important
piece of the puzzle to gain synergies between Restaurant
Casino and Online Gaming.
EuroLotto.com
Europe’s largest daily lottery
draw with a mega jackpot.
Sponsors Special Olympics,
the largest sports event for
persons with intellectual
disabilities.
SpilleAutomater.com
Starts in the spring of 2013
with a strong focus on online
slot machines based on
Cherry’s platform.
CherryCasino.com
A classical casino on the
Internet started by Cherry in
2000, and which once again
is being managed by the
company.
EuroSlots offers a wide range of
the best games available online.
The platform is designed from
the bottom up with the help of
the latest technology.
A GATEWAY TO GERMANY
Cherry’s subsidiary PlayCherry Ltd (Malta) received a
licence in January 2013 in the German federal state
Schleswig-Holstein to offer online casino.
“We see the casino licence as an acknowledgement that
our platform and organisation complies with the high
requirements set to be able to compete on regulated
markets. The licence means that we will be able to market
our gaming in an effective way.”
Schleswig-Holstein is expected to join the other 15 federal
states soon, but in all probability it will not be possible to recall
already issued licences. The licence is an important part
in successfully being able to address the German market.
CONTINUED FOCUS ON EXPANSION
Cherry will continue to work in 2013 with the roll out and
marketing of the EuroSlots platform in new markets, both
under the trademark EuroSlots.com and under local trademarks,
e.g. SpilleAutomater.com.
“We are keeping our sharp focus on growth, with further
investments in new and innovative products. This is fundamental
to create future value,” says Marius Andersen in
conclusion.
cherry 50 years |
13

PART 1 RESTAURANT CASINO
Restaurant Casino:
Cherry’s lead is increasing
more and more
The business area Restaurant Casino experienced its best year yet in 2012. Both
turnover and profits reached new heights. Yet despite a good year for the restaurant
sector, the market for Restaurant Casino continues to shrink in Sweden. Thanks to
ongoing work with procedures and strategic acquisitions, Cherry has succeeded in
increasing both the number of venues and the turnover per table.
14 14 | | cherry 50 50 åryears

Cherry has been successful in its efforts to start gaming in
many new restaurants, but at the same time has been forced to
close other venues because operations were unprofitable.
“In total we have seen an increase in the number of
venues, thanks to our proactive efforts. We are maintaining
and increasing turnover on a market that overall continues to
shrink” says Ulf Bergström, Business Area Manager at Cherry
Casino AB.
INCREASED GAMING PER TABLE
At the venues where Cherry is still open, customers are playing
more than ever before, largely thanks to a series of implemented
measures.
“We have raised the lowest stake level at most venues to
SEK 40 or 50. We have also continued to work on refining
the training of our personnel, so that there is a higher level
of competence than ever before.”
NEW ACQUISITIONS INCREASE TURNOVER
During the year Cherry acquired three competitors –
Göteborgs Casino, Snättringe Casino and City Casino – and
thereby took over operations at several well-known pubs and
restaurants in Gothenburg and Stockholm.
BETTER CONTROL WITH NEW SYSTEM
The launch of the new cash terminals, which in addition to
card payment facilities offer full integration with the new
statistics and business system, is now ready.
“The new system works excellently. All data and statistics
go directly into the system.”
Cherry now has much better statistics and opportunities
for follow-up, and can optimise staffing and opening hours
with better control of statistics on individuals and tables. The
system permits full control of the flow of markers and money
over time, and provides much faster reporting directly
from the venues.
“Legislation hasn’t kept up”
Gustaf Hoffsted (Conservative) is a member of the Swedish Parliament in the Standing
Committee on Cultural Affairs. He explains his standpoint for raising the stake levels.
Why is it important to implement
this motion?
“Today’s gaming legislation concerning
Restaurant Casino from 1995 has not
kept up with the general cost trends. In
practice the maximum stake with a SEK
50 chip has remained unchanged for 18
years. Restaurant Casino has been de-
clining for many years, and if we don’t
introduce a certain adjustment of the
stakes the survival of the entire industry
will be at risk. This risks job opportunities.
I also think that Restaurant Casino is a
nice part of the integrated entertainment
on offer in our restaurants.
Which social consequences can an
increase involve?
“Above all it should be possible to
secure the 1 200 jobs that exist today,
while at the same time it should be
possible to create an additional 1 000 job
opportunities by increasing the stakes. I
believe that restaurant casino can continue
to maintain its low level of problematic
gaming, even after a certain increase in
the stakes. In comparison with the alternatives
offered at Casino Cosmopol or
foreign based gaming on the Internet, the
stake levels are very low and the problems
of addiction to gaming limited.
FURTHER IMPROVEMENTS
Cherry continues to make small changes within the strict
framework of laws and restrictions surrounding the industry.
“We try to get better in all areas, so that we can give our
guests a few moments of fun and excitement,” promises Ulf
Bergström, who is proud to have taken part in building up
Sweden’s largest restaurant casino.
EAGERLY AWAITED MOTION FOR RAISING THE STAKES
The reason for the shrinking Restaurant Casino market
is the legal maximum limit for stakes, which has not been
raised in line with the expenses of gaming operators. The
maximum stake today is about SEK 73, but in practice SEK
50 – which it has been now for almost 20 years. The current
legislation is from 1995 and it has quite simply not kept
up with the times. This has meant a constant decline and
halving of the industry since year 2000.
But after Cherry has spent a long time working to inform
politicians and decision-makers, a member of the Swedish
Parliament has finally written a motion to increase the
stakes. Jan R Andersson (Conservative) proposes raising the
stakes from today’s SEK 70 to 200.
“The next step is for the motion to be considered by the
Ministry of Culture in the spring. At the very best we could
see a change in the law by the end of the year, but there is a
big risk that it will take longer,” adds Ulf Bergström.
The proposed raising of the stakes is a pure case of survival
for Cherry, because wage costs and other costs are rising at
a higher rate than earnings.
“With the raised levels of stakes we would be able to open
more venues and keep them open for more days in the week.
This is estimated to create up to 1 000 new job opportunities,
primarily openings for young unemployed persons.
If the stakes are not raised this will have consequences for
our business operations and job opportunities will be lost
over time.
Which groups will benefit most from the
newly created jobs?
“The industry employs today mainly
young people aged between 18–25 in all
parts of the country. Newly created jobs
will in all likelihood be “openings” that
help us to keep unemployment down
among young people, while also providing
a valuable introduction to working
life.
cherry 50 years |
15

PART 1 dEVELOPMENT PROjECTS
Yggdrasil Gaming:
New gaming company with
innovative number games
16 | | cherry 50 years

Yggdrasil Gaming is a completely new gaming company founded by industry
veteran Fredrik Elmqvist. Yggdrasil supplies innovative and exciting number
games on the Internet, which are sold to different operators. Cherry is both
a pilot customer and a financial investor in the company. For Cherry this
investment is a step towards standing out from the rest and keeping one
step ahead of competitors.
Fredrik Elmqvist, former CEO of Net Entertainment Malta, is
running Yggdrasil together with a close-knit team of colleagues
with solid backgrounds in both online casino and state regulated
lotteries.
Number games are deeply rooted in our consciousness, but
Yggdrasil is the first on the market to make use of the popularity
of number games and combine them with other well-proven
gaming concepts.
“Most people often have one or more favourite numbers, so
we start by giving the player opportunities to play their favourite
numbers by clicking, choosing, doubling up and scratching their
favourite numbers,” says Fredrik Elmqvist, CEO of Yggdrasil
Gaming.
With their concept “NUMB3RS L0V3RS”, Yggdrasil offers a
In 2011 the lottery market
amounted to $ 262 billion. A
large part of the lottery market is
expected to move online, in what
is called “the Final Frontier”.
wide range of lottery games, including the action packed 3D-
Keno, and scratch lotteries for occasional players and high-rollers.
The games are available on computers, mobiles and tablets, and
offer support for 11 European languages and several different
currencies.
In 2011 the lottery market amounted to $ 262 billion. A large
part of the lottery market is expected to move online, in what
is called “the Final Frontier” in the gaming market, after sport
gaming, bingo, casino and poker have successfully established
themselves online.
“We intend to be a key player for operators who want to take
market shares for number games on the Internet,” continues
Fredrik Elmqvist. “We therefore offer our licensed customers
a full-scale product portfolio of innovative games for both newcomers
and veterans.”
Yggdrasil’s business concept is to supply its gaming portfolio
to licensed gaming operators, with the focus on Europe. There
is a big demand for many operators to reinforce their offering
in number games, which today is an underrepresented product
category at private gaming operators on the Internet.
Cherry will as a pilot customer be able to derive significant
benefits from Yggdrasil Gaming’s innovative gaming catalogue.
The products will be offered on Cherry’s web pages.
“As a financial investor we hope that the investment will gene-
rate a good yield for our shareholders,” says Emil Sunvisson, CEO
of Cherry.
The tree of life
The regenerative power in Yggdrasil is our innovative
gaming catalogue, according to Fredrik Elmqvist.
“In the gaming industry everything is called something like
Game, Tech, Play, Bet–and so on,” says Fredrik Elmqvist.
“Reasonably generic. I wanted to have something
that stood out, but still has associations with the
Nordic. And then the name Yggdrasil wasn’t
charged with values, so you could more or
less fill it with whatever you wanted to.”
“Yggdrasil is the tree of life in the old
mythology. We try to create different worlds
for our games and at the same time create
our own world on the basis of the experiences
and lessons we have brought
with us to the business adventure.”
cherry 50 years |
17

PART 1 AkTIEN
The share
Cherry’s B-share is listed on AktieTorget.
SHARE STRUCTURE
At the end of the year Cherry had
12 805 642 shares, divided into
997 600 A-shares and 11 805 042
B-shares. Each A-share carries 10 votes
per share, while each B-share carries
one vote. The shares have equal rights
to the assets and profits in Cherry.
SHARE ISSUES
In 2010 Cherry completed a non-cash
issue of 100 000 A-shares and 6 301 321
B-shares in conjunction with the acqui-
sition of the Automaten group. Cherry
also completed in 2010 a preferential
share issue for acquisition of the Auto-
maten group consisting of 336 600
A-shares and 2 063 895 B-shares at
a subscription price of SEK 12 per
share. The shares were subscribed to
315 percent, of which 99 percent with
the support of preferential rights and
216 percent without the support of
preferential rights, which 99 percent
with the support of preference rights
and 216 percent without the support of
preference rights, which gave Cherry
Share price 12/2011–12/2012
30
27
24
21
18
15
dec 2011
18 | | cherry 50 years
mar 2012
SEK 28 805 940 before issue costs.
The number of shares increased to a
total of 8 801 816 shares via the preferential
share issue and to 12 802 642 for
the issue in kind, divided into 997 600
A-shares and 11 085 042 B-shares.
The share capital increased by SEK
4 840 998.80 from SEK 2 200 454.30
to SEK 7 041 453.10.
In 2009 Cherry also completed the
issue in kind of 45 454 B-shares in conjunction
with the acquisition of operations
in Knock Out AB (Joker Casino).
The company’s share capital thereby
increased by SEK 24 999.70 to SEK
2 200 454.30.
CONVERTIBLES AND OPTIONS PROGRAMME
At an extraordinary general meeting on
19 October 2011 a decision was taken
to introduce a long-term incentive programme
for leading executives and key
persons in Cherry. The decision involves
the issue of a maximum of 500 000
subscription options to persons with
permanent positions in Cherry to
subscribe to the same number of new
jun 2012
shares in Cherry AB.
455 000 subscription options have
been offered to permanent employees,
of which 100 percent have been subscribed
to. The subscription options
were issued at the market price, which
was set at SEK 0.93 and brought in equity
of SEK 423 thousand for the group.
The subscription price for the shares
was set to SEK 22.94, which consists of
130 percent of the average share price
during 20 days of trading before the
date of the meeting, 19 October. The
subscription of shares can take place
during the period 1 November to 30
November 2014. An additional 45 000
subscription options are held by the
wholly-owned subsidiary Cherry Casino
Syd AB. In that the share price from
the introduction of the programme and
as of the balance sheet date exceeds the
subscription price SEK 22.94 the options
had a dilution effect on profit per
share for 2012. In total the options have
exceeded the subscription price for 331
days as of 31-12-2012. This has involved
a dilution effect of 403 548 shares.
sep 2012
dec 2012

19
OWNERSHIP STRUCTURE
As of 31 December 2012 the number
of shareholders in Cherry amounted to
1 932 (1 956).
Several larger holdings in the company
are registered in foreign banks.
This practice means that the board has
incomplete information as to who the
ultimate owners of Cherry are.
LIQUIDITY GUARANTEE
Cherry appointed Remium on 26
September 2007 as a liquidity guarantor
for Cherry’s B-share. The policy
employed by the board of having a liquidity
guarantor is to ensure a lower
investment cost and less risk for investors
trading with the share.
A total of 622 631 (667 317) shares
have changed owners during the year,
which corresponds to approx. 5 (6)
percent of the average total number of
issued B-shares.
PRICE MOVEMENTS AND TURNOVER
The price (last paid) on the balance
sheet date 31 December 2012 was SEK
29.00 in comparison with SEK 17.70
on 31 December 2011. The market
capitalization in 2012 increased to SEK
371.4 million from SEK 226.7 million
on 31 December 2011, which corresponds
to an increase of 64 percent.
The average price per trading day in
2012 was SEK 26.6 (24.0). The highest
official quotation was SEK 30.90 on
28 May and the lowest was SEK 17.80
on 3 January.
Total turnover in 2012 amounted
to SEK 16 583 827 (16 032 717), which
The 21 largest shareholders as of 31 December 2012
Name A-shares B-shares
equals an average of just over SEK
65 809 (63 121) per trading day.
A standard trading unit in Cherry B
is 200 shares.
TRANSFER TO SHAREHOLDERS VIA
SHARE REDEMPTION PROGRAMME
The board proposes that the annual
general meeting decides upon a transfer
to shareholders of SEK 143.4 million
(9.6), corresponding to SEK 11.20 per
share (0.75) through a share redemption
programme, of which SEK 1.20 per
share corresponds to an ordinary
transfer and SEK 10.00 per share to
an extraordinary transfer to the shareholders.
The full proposal will be presented
in good time prior to the annual
general meeting.
Proportion of
share capital. %
Proportion of
residual value. %
Per Hamberg family 295 621 529 753 6.4 16.0
Morten Klein 65 660 2 776 000 22.2 15.8
Lars Kling family 295 621 409 942 5.5 15.5
Lorang Andreassen with family 34 340 1 804 474 14.4 9.9
Rolf Lundström 104 400 150 989 2.0 5.5
Lindwall family 89 761 182 812 2.1 5.0
CAIL 56 098 397 015 3.5 4.4
Arild Karlsen via company 0 919 836 7.2 4.2
Altraplan Bermuda Ltd 56 099 216 345 2.1 3.6
Björn Hornerud Grene via company 0 768 843 6.0 3.5
Knutsson Holdings and Knutsson family 0 575 344 4.5 2.6
BP2S PARIS/NO CONVENTION 406 385 3.2 1.9
EFG PRIVATE BANK S.A.. W8IMY 0 237 759 1.9 1.1
Anders Holmgren via company 0 207 528 1.6 1.0
Rolf Åkerlind family 0 180 800 1.4 0.8
Emil Sunvisson via company 0 176 000 1.4 0.8
Gunnar Lind 0 171 720 1.3 0.8
JP Morgan Bank 0 138 630 1.1 0.6
Fredrik Sidfalk 0 134 816 1.1 0.6
Provibis Invest AB 0 121 749 1.0 0.6
LÄNSFÖRSÄKRINGAR SMÅBOLAGSFOND 0 120 000 0.9 0.6
Other shareholders 0 1 178 302 9.2 5.4
Total 997 600 11 805 042 100.0 100.0
cherry 50 years |
19

PART 1 LEAdING ExECUTIVES ANd BOARd OF dIRECTORS
Leading executives Board of Directors
20 | cherry 50 years
Emil Sunvisson
born 1971, Gnesta
CEO Cherry AB (plc)
Employed in the group since 2011
Former board member since 2006
Share holding: 176,600 B-shares via company
200,000 subscription options
Fredrik Burvall
born 1972, Nacka
CFO and vice CEO Cherry AB (plc)
responsible for investor relations (IR)
cherry ab (publ)
Employed in the group since 2006
Share holding: 49,900 B-shares
50,000 subscription options
Marius Andersen
born 1974, Malta
business area manager Online Gaming
Employed in the group since 2010
Share holding: 50,000 subscription options
Per-Anders Persson
born 1959, Solna
business area manager Restaurant Casino
region north
Employed in the group since 1979
Share holding: 37,240 B-shares
20,000 subscription options
Ulf Bergström
born 1966, Kungsbacka
business area manager Restaurant Casino
region south
Employed in the group since 1986
Share holding: 37,168 B-shares
20,000 subscription options
Aron Moberg-Egfors
born 1977, Borås
sales manager Restaurant Casino
Employed in the group since 2009
Share holding: 102,598 B-shares
30,000 subscription options
Auditors
PwC:
Appointed at AGM 20-05-2010 for period to AGM 2014.
Senior auditor: Niklas Renström, Auditor, born 1974,
Saltsjö-Boo, authorised public accountant.
Rolf Åkerlind
born 1943, Saltsjöbaden
chairman
Member of the board since 2006
Other assignments: Chairman i SEAB AB and
Stark Fasadrenovering and board
member in Constant Clean AB
Share holding: 180,800 B-shares. Includes holding via
family members and endowment assurance.
Morten Klein
born 1969, Oslo
board member
Member of the board since October 2011
Other assignments: Chairman in Klein Holding AS,
Norwandia AS, Morten Klein AS and
Yes Games AS
Share holding: 65,660 A-shares, 2,776,000 B-shares
Anders Holmgren
born 1973, Stockholm
board member
Member of the board since 2010. Founder of gaming site Betsson.
Other assignments: Chairman Northberry AB,
Fu Sheng, Interactive Ltd and member
in NASP AB
Share holding: 207,528 B-shares via company
Martin Wattin
born 1974, Stockholm
board member
Member of the board since annual general meeting 2011
Other assignments: Chairman Rabble Communications AB,
Apotekslinsen AB, member in i Mostphotos
AB and CEO of Inbox Investment AB
Share holding: 27,361 B-shares
Kjell Berggren
born 1958, Stockholm
board member
Member of the board since 2010
Other assignments: Senior Vice President, Global Head of
Expansion/Development Esprit
Share holding: No shareholding
Jörgen Olsson
born 1976, Gävle
employee representative, board member
Appointed by HRF as employee representative since 2007
Share holding: 750 B-shares via associated company

Cherry’s
Annual Report 2012
The Board of Directors and the CEO of Cherry AB (plc), corporate identity number
556210-9909, with registered office in Stockholm, is hereby submitting the annual
report for the fiscal year 2012 for the Parent Company and for the Group. The
Annual Report including the Auditor’s Report comprises the pages 22– 61.
Cherry has during 2012 changed the name of the Parent Company from
Cherryföretagen AB (plc) to Cherry AB (plc).
21

Part 2 AdministrAtion report
The results of the year’s activities and the position of the parent company and the group are
presented in the administration report and the following income statements and balance sheets,
cash flow statements, specifications of equity and other related notes and comments. The reporting
currency for the parent company and the group is Swedish kronor (SEK). The consolidated income
statements and balance sheets for the group and the parent company are subject to the approval
of the annual general meeting on 7 May 2013.
Administration report
ABOUT CHERRY
Cherry’s business concept is to offer fun &
excitement with entertaining and exciting
gaming in a safe environment. Cherry’s activities
during the most part of 2012 have been
divided into three business areas, along with
group-wide and development projects. One
business area, Maritime Gaming, was discontinued
in November 2012.
ONLINE GAMING
Online gaming via the websites EuroSlots.com,
SverigeAutomaten.com, NorgesAutomaten.com,
DanmarksAutomaten.com and EuroLotto.com,
including affiliate activities from Cherry-
Affiliates.com, is all managed by subsidiaries
from Malta. SverigeAutomaten.com, Norges-
Automaten.com and DanmarksAutomaten.com
were divested in the first quarter of 2013, while
Cherry acquired CherryCasino.com.
RESTAURANT CASINO
Traditional casino gaming (Blackjack and Roulette)
is managed at some 250 Swedish restaurants
and night clubs. Event casino is also offered
to companies and private persons.
MARITIME GAMING
Discontinued in November 2012.
GROUP-WIDE AND DEVELOPMENT PROJECTS
Cherry has several development projects managed
within the group to create new services and
products that support Cherry’s business concept,
expansion and development strategy. Up
until the time the product or service in launched
and established, the cost is taken centrally within
the group and reported in segment reporting as
”Development Projects” to create transparency
in what the group’s different business areas
generate. Cherry invested in Yggdrasil in 2012
within the framework of a development project.
Yggdrasil supplies innovative and exciting
number games on the internet, which is sold to
different operators. Cherry is both a pilot customer
and a financial investor.
22 | annual report 2012
THE PAST YEAR
THE GROUP – FISCAL YEAR 2012
Group sales increased by 28 percent to SEK 473.1
million (368.7). EBITDA increased by 161 percent
and amounted to SEK 115.9 million (45.3)
and EBIT amounted to SEK 36.8 million (40.0).
Adjusted for comparative items, revaluation
of additional purchase price and goodwill, sales
increased by 16 percent to SEK 399.7 million
(344.9) and EBIT by 122 percent to SEK 36.8
million (16.6).
Group profit after financial items amounted
to SEK 32.6 million (39.0) and profit after tax
amounted to SEK 31.0 million (38.0), corresponding
to SEK 2.35 (3.08) per share after
dilution and minority interest.
Return on equity was 9 percent (13) and on
total capital 8 percent (9). Cash holdings in the
group amounted to 59.0 MSEK (30.4) at the
end of the period, and the equity ratio amounted
to 86 percent (70).
ONLINE GAMING – FISCAL YEAR 2012
Earnings for the fiscal year increased by 21 percent
to 265.1 MSEK (219.1) and operating profit
(EBIT) improved by 95 percent to 33.7 MSEK
(17.3).
NorgesAutomaten, SverigeAutomaten and
DanmarksAutomaten continued to deliver
stable results. Earnings from CherryAffiliates.
com continued to develop positively. EuroSlots.
com, which is based on Cherry’s own platform,
was launched on 21 November. EuroSlots has
been launched in Finland and during December
the customer database at PlayCherry.com
migrated from IGT (International Game Technology)
to Cherry’s platform. Volumes on the
platform remain relatively small, but are growing
at a fast percentage rate. During the fiscal
year Cherry focused on maintaining the large
customer database taken in via EuroLotto.
Deposited amounts increased in 2012 by 6
percent to SEK 665.9 million (627.3) and the
number of active customers amounted as of
31-12-2012 to 30 565 (40 316). The number of
new customers amounted in 2012 to 107 399
(128 568) and the number of registered customers
amounted at the end of the period to
325 901 (218 502).
IMPORTANT EVENTS IN ONLINE GAMING
DURING THE FISCAL YEAR OF 2012:
• Cherry launched a new product on 21 November,
EuroSlots.com, focusing on online
slot machines. EuroSlots is based on a newly
developed platform with its own licence in
Malta issued by LGA (Lotteries and Gaming
Authority). EuroSlots offers many creative
functions and games from Net Entertainment
and Microgaming. The launch means
that Cherry has full control over the product
offering and also better financial leverage
with low variable costs. This allows Cherry
to maintain its focus on growth in Online
Gaming with further investments in new
innovate products, which is fundamental to
create future value.
• Cherry received a licence in October from
LGA (Lotteries and Gaming Authority) in
Malta.
IMPORTANT EVENTS AFTER THE REPORTING
PERIOD:
• Cherry’s subsidiary PlayCherry Ltd (Malta)
received a licence in January 2013 in the
German federal state Schleswig-Holstein
to offer online casino. Schleswig-Holstein
adopted a new law in 2012 which makes it
possible to issue licences for online gaming
to private actors. A total of 20 casino licences
have been issued, and the local tax is 20
percent of gaming earnings.
• Cherry sumbitted a lawsuit in January 2013 at
Oslo City Court against the Norwegian state
concerning the injunction issued against
Cherry AB. In the injunction Lotteri- og Stiftelsestilsynet
demands that Cherry AB close
its offer of gaming for money and stops marketing
in relation to Norwegian citizens for
EuroLotto.com. Cherry will await the decision
of the court before taking any measures.
• In February Cherry Malta Ltd sold its trademarks
and domains related to SverigeAutomaten,
NorgesAutomaten and Danmarks-
Automaten to Betsson AB (plc). The proceeds
amounted to SEK 286.0 million. In conjunction
with the sale, Cherry acquired the
gaming site CherryCasino.com for SEK 1.0
million. Cherry has the right to earning and
profits from the Automaten sites up until

31-03-2013, which will be reported in the results
for discontinued operations. The initial
net proceeds of SEK 225 million have been
regulated through the delivery of a corresponding
1 063 895 new issue of Betsson
B-shares. The shares were sold on 21 February
and the transaction provided Cherry with SEK
228.7 million before deductions for transaction
costs. The sale was executed to a discount
of approx. 2.0 percent in relation to
the trading price for the Betsson share at the
time. The remaining proceeds will be regulated
with liquid assets after twelve months. The
Automaten sites sites generated earnings in
2012 of SEK 168.2 million. CherryCasino.
com generated earnings in 2012 of SEK 1.5
million. Goodwill arising in conjunction with
the acquisition of the Automaten group,
and which as of 31 December 2012 amounted
to SEK 260.6 million, was written down as a
result of the sale to SEK 0.0 million.
THE AUTOMATEN GROUP
• The terms and conditions required for payment
of the additional purchase price have
not been met. The liability for the additional
purchase price has therefore been valued to
zero as of 31-12-2012. Since the acquisition
was implemented according to IFRS 3 began
to be applied, the revaluation of the additional
purchase price of SEK 73 446 thousand
(23 828) has been reported in the income statement
(included in Other operating income)
in the consolidated financial statements.
• The goodwill attributable to the Automaten
Group has undergone an impairment test,
whereby a write-down requirement of SEK
73 447 thousand was identified.
• The acquisition of the Automaten Group has
given Cherry a lot of experience and knowhow,
despite the fact that the high thresholds
to reach the additional purchase price have
not been met.
RESTAURANT CASINO – FISCAL YEAR 2012
Earnings for the fiscal year increased by 7
percent and amounted to SEK 134.5 million
(125.8). Operating profit (EBIT) improved by 22
percent and amounted to SEK 12.3 million
(10.1). The main explanation for the increase
in earnings and improvement in profit is that
Cherry has taken venues from competitors,
and acquired Snättringe and City Casino in
July 2012, and Göteborgs Casino in December.
Cherry has in 2012 signed 60 new Restaurant
Casino agreements in Sweden. At the
same time 44 venues have been closed as a result
of unprofitability, conceptual changes, loss
of alcohol licences or bankruptcy, and two venues
were closed for the season at the year end.
Cherry’s market share increased and amoun-
ted to 58 percent (55) of the active gaming tables
according to statistics from Lotteriinspektionen
(Gaming Authority of Sweden) for December
2012. Cherry had at the end of the quarter gaming
at 254 venues (240) with a total of 349 tables (345).
IMPORTANT EVENTS IN 2012:
• Cherry signed an agreement in July with
Gröne Jägaren in Stockholm, which is one the
most well-known restaurants in Stockholm.
• In July Cherry took over the casino business
from City Casino AB and Snättringe
Restaurang AB, which includes 16 venues.
The agreement with City Casino AB and
Snättringe Restaurang AB is based on the
allocation of earnings over a limited period.
Cherry estimates that annual sales will increase
by approx. SEK 8 million as a result of
the acquisition and that it will have a positive
effect on profit, starting from the acquisition.
The venues are in the Stockholm area and the
most well-known venues include Victoria,
Collage, Vasakoppen Café, O´Learys Södertälje
and Soft Bar & Kök.
• On 26 September a motion was submitted
to the Swedish Parliament (2012/13:Kr221)
with the implication that the maximum stake
for Blackjack should be adjusted to SEK 200
from the current level of just over SEK 70. The
motion is expected to be considered by the
Ministry of Culture in the spring of 2013.
An increase in the stake level is estimated to
provide prospects for 1 000 new job opportunities
for young people aged 18–25. In addition
to this, indirect jobs are expected in the restaurant
sector as a result of improved profitability.
• In December Cherry took over the casino business
from Göteborgs Casino AB, which includes
11 venues in and around Gothenburg.
Cherry estimates that the acquisition will increase
sales by approx. SEK 6 million a year
and that it will have a positive effect on profit,
starting from the acquisition. Some of the
most well-known places taken over include
Jamesons Pub, P C Restaurang, Restaurang
Babar, Restaurang Bryggeriet Göteborg,
Restaurang Excet/Lemon bar, The Flying
Scotsman and Tribeca.
SALE OF MARITIME GAMING
The Maritime business area has been divested
during the year.
Cherry completed on 8 November 2012 the
sale of all shares in Cherry Maritime Gaming
AB, Astral Maritime Services Ltd and Cherry
Services Ltd to Bell Casino AB. Bell Casino AB
took over the companies from 30-09-2012.
In total Cherry has received SEK 36.3 million
in proceeds from the sale of the shares, dividends
from the sold subsidiaries and repayment
of debt to the parent company, and Cherry’s net
cash holdings increased with SEK 27.8 million.
Cherry reported a result for the fiscal year from
the sale of Maritime Gaming of SEK -0.6 million.
Earnings from discontinued operations
Cost of discontinued operations
Result for discontinued operations to
time of disposal
Capital loss
Result discontinued operations
annual report 2012 |
67.7
-68.3
-0.6
0.0
-0.6
Cherry applied IFRS 5 for disposal of the maritime
segment. IFRS 5 specifies how discontinued
operations should be presented and what
information should be issued for discontinued
operations. The results of discontinued operations
should be reported in a separate income
statement, and in the company’s income statement
is taken up under the item “Result from
discontinued operations” (net after tax). A further
analysis of the result from discontinued
operations is included in Note 32.
GROUP-WIDE AND DEVELOPMENT PROJECTS
Cherry focuses on finding profitable products
and services that support the group’s business
concept and long-term strategy. Earnings for
the fiscal year 2012 in development projects
amounted to SEK 0.0 million (0.0) and were
charged to operating profit (EBIT) by SEK -0.4
million (-0.2).
During the period 2012 to 2007 the group
has launched the following development projects,
including acquisitions:
2012:
• Investment in Yggdrasil, which develops innovative
online number gaming and which
in 2013 will be sold to different operators.
• Launch of own platform through the website
EuroSlots.com – European online slot
machines.
• Acquisition of three restaurant casino companies,
Snättringe-, City- and Göteborgs Casino.
2011:
• Launch of Europe’s largest lottery with daily
draws, EuroLotto.com
• Launch of CherryAffiliates.com – which will
in time increase sales and profitability in
Online Gaming.
GROUP-WIDE
The parent company supplies and sells internal
services to other group companies, primarily
within finance, economics, and business development,
and supplies the listing platform,
administration and management. The Parent
Company also has some revenues from external
licences. The parent company changed its name
in 2012 from Cherryföretagen AB to Cherry AB.
23

Part 2 AdministrAtion report / mAnAgement And control
INVESTMENTS
The investments of the Cherry Group in intangible,
tangible and financial fixed assets
amounted during the year to SEK 15.2 million
(6.4).
LIQUID ASSETS AND CASH FLOW
Liquid assets for the group amounted on 31
December to SEK 59.9 million (30.4). Interest
bearing liabilities amounted to SEK 1.8 million
(15.8). Cherry has in the fourth quarter amortised
in advance the last part of the acquisition
loan related to the acquisition of the Automaten
group in 2010 of SEK 6.7 million.
The cash flow from operations amounted
to SEK 41.1 million (24.8). The equity ratio
amounted to 86 percent (70) at the year end.
EMPLOYEES
The average number of employees (number of
employees converted to full-time jobs) within
the group amounted to 204 (203) for the year.
At the end of the year the number of employees
amounted to 677 (722) persons. The majority
of employees in the group are active as
croupiers or dealers at the Swedish Restaurant
Casino. Most of them are young people who
combine their studies with part time work in
the evenings and at weekends.
FUTURE PROSPECTS
The business area Online Gaming is estimated
to grow more quickly than the online gaming
market. H2 Gambling Capital estimated in
November 2012 that the global online gaming
market would grow by 9.1 percent in 2013. Online
gaming is characterized by severe competition
and rules and regulations, which can quickly
change in the different European countries. Cherry
estimates that the company will report negative
margins in the business area Online Gaming
in the second and third quarters in 2013 as a result
of the investment in growth and the sales of
the Automaten sites. Cherry will launch several
products and services that will be accommodated
within the business area Development Projects
to support Cherry’s business concept and longterm
strategy.
The legal situation for gaming on the Internet
changes on a regular basis in different geographical
markets. Pressure is still being exerted on
countries in the EU to adapt national legislation
to the applicable EU laws, with the free movement
of products and services. Several countries
have advised that they are working with new legislation
that will be compatible with the requirements
of EU.
The market for Restaurant Casino is shrinking
every year. An increase in the stakes would
be able to create growth and job opportunities.
Jan R Andersson (Conservative) has submitted a
24 | annual report 2012
motion to the Riksdag (2012/13:Kr221) with the
implication that the maximum stake for Blackjack
should be adjusted to SEK 200 from the
current level of just over SEK 70. The motion is
expected to be taken up for consideration by the
Ministry of Culture in the spring of 2013.
Cherry is not issuing a forecast for 2013.
ESSENTIAL RISKS AND
UNCERTAINTY FACTORS
POLITICAL DECISIONS
Gaming on most national markets is strictly
regulated by law and all gaming activities are
in principle subject to licence. Cherry’s operations
are therefore influenced to a considerable
extent by political decisions. The legal situation
for gaming on the Internet changes on a regular
basis in different geographical markets.
Cherry is actively engaged in remaining informed
of any changes concerning gaming
legislation in Europe.
LEGAL DISPUTES
Persons who suffer from an addiction to
gaming may come to sue companies within the
Cherry Group for their gaming abuse. Even if
such claims are overruled, they could give rise
to substantial legal costs and possibly a loss of
confidence in Cherry, which by extension would
lead to a reduction in earnings. Cherry’s gaming
sites give customers the opportunity to
decide for themselves how much they want to
play for and there are several gaming responsibility
tools for players on the sites, where the
player can decide to switch off, or limit the
amount to play etc. Cherry also works together
with our partners with Global Gambling Guidance
Group (G4), an organisation that certifies
responsible gaming websites on the Internet.
Concerning traditional gaming we have the opportunity
via physical croupiers to refuse players
who have, for example, been drinking too
much. The stakes in Restaurant Casino are restricted,
which minimises the risk of addiction.
Cooperation agreements with partners and
customers can result in legal disputes and applications
for summons.
During 2011 Cherry received a claim from
Norway’s Lotteri- og stiftelsetilsyn (Gaming
and Foundation Authority) where they demanded
that Cherry should stop its marketing
of gaming on EuroLotto.com in relation to Norwegian
players. Cherry finds that the claims of
Norway’s Lotteri- og stiftelsetilsyns are invalid
in that they are directed towards the parent
company Cherry AB (plc) and not EuroSlots
Ltd, and also because they are in conflict with
EEA law, which is superordinate to Norwegian
legislation. Cherry issued an appeal on 5 May.
On 8 July Norway’s Lotteri- og stiftelsetilsyn informed
that the case will be referred to Lotteri-
nemnda (Lottery Committee) in Norway. On 28
October Norway’s Lotterinemnda announced
that the injunction of Lotteri- og stiftelsetilsynet
against Cherry remained in place. On 9 January
2012 the Ministry of Culture announced that
the claim remained in place. No penalties have
been announced.
Cherry submitted a lawsuit in January
2013 at Oslo City Court against the Norwegian
state concerning the injunction issued against
Cherry AB. Cherry will await the decision of
the court before taking any measures.
Cherry has in 2012 initiated a legal process
against a supplier in Online Gaming. Cherry
has won in the first instance and feels confident
of winning the legal process, which would
have a positive financial effect on Cherry.
Cherry estimates that the process will be resolved
in 2013, or in the first half of 2014.
There are no other legal disputes in progress
from previous years and no lawsuits or other
claims other than the above that have been
directed at Cherry during the year or after the
year end.
COMPETITION
The Swedish restaurant casino market is a mature
market and characterised by a large number
of small players. In line with a possible
reconciliation of Swedish gaming legislation to
international legislation, the board expects that
competition may increase. The board considers
that Cherry has an established and solid position
on the Swedish restaurant casino market.
Further political decisions with a negative
effect for the Cherry Group, or increased competition
from financially stronger competitors,
can result in significant negative effects
for Cherry. There are many competitors with
similar products in online gaming and this
competition can in the future come to further
increase from Internet based players. Online
gaming is a highly competitive market, and
one that requires a lot of marketing. Cherry is
actively engaged in strategic policies to handle
any increase in the competition.
RELIANCE ON LARGE CUSTOMERS
There are more than 200 customers in the
business areas in the Cherry Group. No single
customer accounts for more than ten percent
of group sales. Cherry is actively engaged in reinforcing
its customer relations in all business
segments.
CUSTOMER AGREEMENTS
Some of the customer agreements in the
Cherry Group in Restaurant Casino can be
cancelled, i.e. if the restaurant or night club in
which the activity is conducted is transferred,
sold or its management is taken over by another

operator. This is a standard regulation in the
industry. Even if Cherry signs long-term agreements
there is therefore no guarantee that a
contractual obligation will persist during the
term of the agreement.
ECONOMIC SITUATION
The restaurant casino sector has historically
followed developments in the restaurant sector.
Online gaming is relatively insensitive to
changes in economic activity.
CHANGES IN CONSUMER BEHAVIOUR
Cherry’s traditional gaming is challenged by
online gaming. One risk to which Cherry is
exposed is that in the future it could become
too expensive to adapt to what customers want
to have for gaming options, or that laws prohibit
traditional gaming from offering equally
attractive forms of gaming as on the Internet.
Cherry has through its own platform EuroSlots
taken a major step towards becoming an important
player in online gaming, and also sees
opportunities that traditional gaming and online
gaming will come closer to each other,
which could also produce new opportunities.
Management and control
LEGISLATION AND ARTICLES OF ASSOCIATION
Cherry AB (plc) shall in the first instance
apply the Swedish Companies Act and the
regulations that follow from the listing of the
share at AktieTorget. Cherry shall also in its
activities follow the regulations specified in
Cherry’s articles of association. This is available
on Cherry’s website.
ANNUAL GENERAL MEETING
Notice is given of the annual general meeting
no earlier than six weeks and no later than four
weeks prior to the meeting. The notice contains
information on application and on the right to
participate and vote at the meeting, the listed
agenda and the issues that are to be considered,
information on proposed dividends, and the
main content of other proposals. Shareholders
or their representatives can vote for the full
number of shares owned or represented. Proposals
to the meeting should be addressed to the
Board of Directors and submitted in good time
before notice is issued. The minutes from the
meeting are submitted to shareholders on request,
and are available at the company’s website.
Nomination procedures are carried out by one
of the largest shareholders appointed to the
CASH HANDLING
Cash is handled in the Cherry Group, which
does involve the risk of theft and robbery. In
addition to this only a certain part of cash handling
is insured. The risks involved with handling
cash in Restaurant Casino have nevertheless
been reduced in that the physical handling
of cash at most of the venues is not handled
by the Cherry Group. Most of the handling
is managed by the customers instead (restaurants
and night clubs). The Cherry Group also
cooperates with Nokas, Loomis and others in
Restaurant Casino. Cash is still handled and
transported, however, at some venues in the
group. Theft has occurred at some of Cherry’s
venues, but this is thoroughly investigated and
the group cooperates with Säkert Företag in
Malmö. Cherry continuously strives to improve
security for our personnel and the handling of
cash by developing new and better systems,
reviewing routines, and increasing credit and
cash card handling at our venues. Cherry also
has an internal control system, which quickly
detects deviations and thefts.
RELIANCE ON PARTNERS AND KEY PERSONS
Cherry relies on the agreements companies enter
into with restaurants and night clubs in Restaurant
Casino activities. If Cherry loses a large
nomination committee. The following nomination
committee has been appointed prior to
the annual general meeting in 2013:
Morten Klein (appointed by Morten Klein
AS), John Wattin (appointed by the Hamberg
family), Pontus Lindwall (appointed by the
Kling family) and Rolf Åkerlind (Chairman of
Cherry AB). Rolf Åkerlind gives notice of the
nomination committee. The AGM in 2012
appointed Rolf Åkerlind and Anders Holmgren
to the audit committee. The full Board of Directors
is included in the remuneration committee.
BOARD OF DIRECTORS
Board members are elected annually at the
AGM for the period until the next AGM is held.
There are no rules concerning the longest
period of time a member can be included on
the board. There are six members in Cherry’s
board. Five of the members are elected at the
AGM and one member is appointed by the
employee organisation HRF. The members
include persons linked to Cherry’s large shareholders,
Morten Klein and Martin Wattin, as
well as persons independent of them. The CEO
is not included in the board.
By the definition of the Stockholm Stock Ex-
number of such agreements this would have a
negative effect on operations.
In Online Gaming operations Cherry has
signed an agreement with Otto Malta Ltd for
EuroLotto, where Cherry utilises their licence and
technology. Cherry engages several consultants
and partners for the development, management
and marketing of Cherry’s online operations. If
any of these consultants or partners should fail
to meet their obligations in relation to Cherry
this could have a negative effect on operations.
For a description of financial risks, refer to
Note 3.
RESEARCH AND DEVELOPMENT
Cherry does not undertake research activities.
Development work is reported as assets in the
balance sheet, where it complies with the requirements
set in IFRS. Cherry has conducted
development projects in 2012 in Online Gaming,
which comply with these requirements and are
reported as intangible assets. SEK 5.6 million
(1.2) has been activated for development costs
in 2012.
ENVIRONMENT
Cherry does not conduct any activities subject
to licence or notification in accordance with the
Environment Act.
change the number of board members independent
of the company should be 80 percent and the
number of members independent of the larger
shareholders 40 percent. More than half of the
board members and more than half of the members
of the group executive have underdone training
courses in the regulations of the Stockholm
Stock Exchange. The CEO is presenting facts to
the board. Occasionally persons from the management
team participate in board meetings as
presenters of special issues. The CFO acts as the
board’s secretary.
The board held twelve meetings at which
minutes were taken in 2012. The board has
paid special attention to strategic, financial and
accounting issues, major investments, disposals
of operations and development projects, as
well as decisions regarding advance payments
of gaming shares to venue owners. The work
of the board follows a plan to ensure that
it receives all the required information.
The companies that Cherry jointly owns
with external owners have their own functional
board. Cherry’s representatives in these
boards consist of persons from Cherry’s management
team and/or other Cherry employees
with suitable competence profiles. The compa-
annual report 2012 |
25

Part 2 mAnAgement And control
nies Cherry owns on Malta have autonomous
boards.
The company auditors report their observations
from their audit of the annual report
and their assessment of the company’s internal
routines and control to the audit committee
and the board. The board has adopted an
agenda and issued instructions concerning
the allocation of work between the board and
the CEO, as well as information that the board
should receive on a regular basis.
MANAGEMENT TEAM
The board has delegated the operative responsibility
for the administration of the company
and the group to the company’s CEO. Most subsidiaries
normally only have a formal executive
board, consisting of the CEO and, or CFO, or the
business area manager. The CEOs of the subsidiaries
therefore report internally directly
to Cherry’s CEO. Instructions have been prepared
for respective CEOs in the wholly owned
subsidiaries, which are transparent with the
instructions for Cherry’s CEO.
Cherry’s management team consisted at
the year-end of six persons: Cherry’s CEO,
the CFO who is also responsible for IR and
vice CEO for the Cherry Group, two business
area managers for Restaurant Casino divided
into two geographical areas (South and North),
the sales manager for Restaurant Casino, and
a business area manager for Online Gaming.
The group executive met on two occasions in
2012. The meetings dealt with earning trends,
reports and issues prior to and after board
meetings. Issues dealt with also concerned
the budget, forecasts, investments, security,
risks within the group and policies, as well as
reviews of market trends and the general economic
situation. Business area related projects
were also discussed and decided upon. In addition
to group executive meetings, regular management
meetings are held with the management
in respective segments, where specific
segment issues are dealt with.
REMUNERATION
Remuneration to the board, CEO and other
leading executives during the year is indicated
in Note 7.
INCENTIVE PROGRAMMES 2011–2014
At an extraordinary general meeting on 19
October 2011 a decision was taken to introduce
a long-term incentive programme for leading
executives and key persons in Cherry. The
decision involves the issue of a maximum of
500 000 subscription options to persons with
permanent positions in Cherry to subscribe to
the same number of new shares in Cherry AB.
455 000 subscription options have been offered
to permanent employees, of which 100 percent
26 | annual report 2012
have been subscribed to.
An additional 45 000 subscription options
are held by the wholly owned subsidiary Cherry
Casino Syd AB. More information on the options
programme is available in Note 7.
AUDIT
PwC was chosen as auditor in 2010, with
authorised public accountant Niklas Renström
as senior auditor up until the AGM in 2014. PwC
conducts audits of Cherry AB and all the Swedish
subsidiaries, and all the companies in Malta.
The audit of the annual report and consolidated
financial statements takes place in
January–February. An audit of internal routines
and the control system also takes place
throughout the year, which is reported to the
audit committee, the board and executive.
Reports are submitted to both the audit committee
and the board of observations made
during the audit of the annual accounts and
assessment of the company’s internal routines
and financial control. In addition to the audit
assignment, Cherry has also used PwC for consultations
in accounting issues. The remuneration
paid is indicated in Note 8.
DISCHARGE OF LIABILITY
The board has been authorised at the AGM in
2012 during the period to the next AGM, on
one or more occasions and with or without
preferential rights for shareholders, to take
a decision on the non-cash issue of a total of
1 280 000 shares in the B series in conjunction
with the acquisition of companies. The issue
price for the new shares will be based on the
market price of the company share.
The purpose of this authorisation is to enable
efficient acquisition by means of payment
with shares.
GUIDELINES FOR REMUNERATION AND OTHER
COMPENSATION TO LEADING EXECUTIVES
The Swedish Companies Act stipulates that
the board shall at the annual general meeting
set out proposals for guidelines in relation to
salaries and other compensation for leading
executives. The annual general meeting shall
thereafter decide upon the guidelines to apply
for compensation from the company to leading
executives. The leading executives in this context
refer to the persons who together with the
CEO constitute the group executive.
UPDATED GUIDELINES
A decision was taken at the annual general
meeting in 2012 that the remuneration to the
board would amount to SEK 780 000, of which
SEK 290 000 to the chairman and SEK 110 000
to each of the other board members, and including
SEK 50 000 to the chairman in the
audit committee.
It was decided that compensation would be
paid to the auditor on approval of the accounts.
It was decided that the level of remuneration
for leading executives would be in line
with the market and competitive, with a view
to attracting and retaining competent executives.
Remuneration shall consist of fixed salaries,
and where appropriate variable salaries,
and include pension commitments and other
benefits such as a company car.
Any variable remuneration offered to leading
executives shall be determined on the basis
of the fulfilment of group-wide and individual
targets set in advance in relation to the results
of their administration and the financial development
of the company, and in consideration
of the personal development of the executives
concerned. Variable remuneration may only be
paid up to 100 percent of the fixed salary.
The normal retirement age is 65. Pensions
shall be in line with the market and based on
defined contributions. Pension premiums are
maximised to 35 percent of annual salary, including
bonuses.
The employment termination notice period
is normally six to twelve months if notice
is given on the initiative of the company, and
six months if such notice is at the initiative of
the executive. If notice is given by the company,
severance pay can be paid to an amount corresponding
to 12 months salary.
The board may depart from any such guidelines
if there are special grounds to do so in
individual cases.
PROPOSED GUIDELINES FOR 2013
Remuneration is paid to the chairman, board
members and the audit committee in accordance
with the decision of the annual general
meeting. Remuneration to the CEO and other
leading executives consists of a basic salary, in
some cases variable salary, pension commitments
and other benefits, and is decided by the
remuneration committee.
Remuneration to the CEO shall consist of
a fixed basic salary and a variable salary based
on the results for the group and pension commitments
in accordance with the ITP plan. The
variable part shall be maximised to the scale of
the fixed remuneration. Remuneration to the
CEO is negotiated by the chairman and decided
by the board.
Remuneration to other leading executives
shall consist of a fixed basic salary and in some
cases a variable salary and pension commitments
in accordance with the ITP plan. The
variable part shall be maximised to 100 percent
of the fixed remuneration, and shall be paid on
the basis of the performance targets approved
by the board. Salaries for leading executives
are negotiated by the CEO and decided by the
chairman.

The normal retirement age is 65. Pensions
shall be in line with the market and based on
defined contributions. Pension premiums are
maximised to 35 percent of annual salary, including
bonuses.
The period of notice is normally six to
twelve months if notice is given on the initiative
of the company, and six months if such
notice is at the initiative of the executive. If
notice is given by the company, severance pay
can be paid to an amount corresponding to 12
months salary.
The board proposes that remuneration to
the auditor is paid on current account.
The board may depart from any such guidelines
if there are special grounds to do so.
INFORMATION ON PARENT COMPANY
The parent company supplies and sells internal
services to other group companies, primarily
within finance, economics, business development,
administration and management, as
well as other external licence earnings. Earnings
for the fiscal year amounted to SEK 2.0
million (1.8) and profit/loss before tax amounted
to SEK -18.5 million (38.6). The fall in profits
in the parent company is attributable to losses
incurred on disposal of the share in the Maritime
operations and because no anticipated
dividends from remaining subsidiaries has
been reported, which took place in the year end
accounts for 2011.
The investments of the parent company in
tangible and intangible assets amounted to SEK
162 thousand (496). Liquid assets amounted at
the year end to SEK 41.3 million (17.8).
LISTING AND OWNERSHIP
The Cherry B-share has been listed on Aktie-
Torget since 12 September 2006. Cherry had
12 802 642 shares at the end of the year, divided
into 997 600 A-shares and 11 805 042
B-shares. Each A-share carries 10 votes, while
each B-share carries one vote. The shares have
equal rights to the assets and profits in Cherry.
The company had a total of 1 932 shareholders
at the end of the year. The largest owners
are the Hamberg family with 6.4 percent of
the capital and 16.0 percent of the votes, and
Morten Klein with a 22.2 percent holding and
15.8 percent of the votes. See also page 19 for
additional information on the owners.
PROPOSED ALLOCATION OF PROFITS
The board proposes that no dividends are paid
for the fiscal year of 2012 and that previously
communicated dividends are replaced by a redemption
programme as below.
The full proposal will be presented in good
time prior to the annual general meeting.
The following assets remain
at the disposal of the AGM: (TSEK)
Unappropriated profits and free funds 363 544
Profit/loss for the year
-18 470
Total
345 074
The board proposes that the whole amount,
345 074 thousand, should be carried forward.
TRANSFER TO SHAREHOLDERS VIA
SHARE REDEMPTION PROGRAMME
The board proposes that the annual general
meeting decides upon a transfer to shareholders
of SEK 143.4 million (9.6), corresponding to
SEK 11.20 per share (0.75) through a redemption
programme, of which SEK 1.20 per share corresponds
to an ordinary transfer to shareholders
and SEK 10.00 per share corresponds to an
extraordinary transfer to shareholders. After the
redemption programme is completed the unappropriated
profit and free funds in Cherry AB
will amount to SEK 201.7 million.
STATEMENT BY THE BOARD AS PER 20 CHAP.
8 § OF THE COMPANIES ACT (2005:551)
With respect to the proposal of the board concerning
a reduction of the share capital with
repayment to shareholders, the board hereby
issues the following statement in accordance
with 20 chapter 8 § of the Companies Act.
The unappropriated profit in the company as
of 31 December 2012 amounted to SEK 345.1
million, and net profit/loss for the year amounted
to SEK -18.5 million. The annual general meeting
thereby has an unappropriated profit of
SEK 345.1 million at its disposal.
There is full coverage for the restricted
equity in the company after the proposed share
redemption programme. The board has taken
into consideration the consolidation requirements
and liquidity for the company and the
group through an overall assessment of the financial
position of the company and the group
and their opportunity to meet their obligations
in the long term. The proposed share redemption
programme does not endanger the capacity
of the company to make the investments deemed
to be necessary. The financial position of the
company does not give rise to any other assessment
than that the company can continue its
operations and that the company is expected to
fulfil its obligations in the short and long term.
In addition to the assessment of the company’s
consolidation and liquidity requirements,
the board has also taken into consideration all
other known circumstances that can be of
importance for the financial position of the
company.
With reference to the above the board considers
the share redemption programme to be
justified in relation to the requirements set by
the type of operations, scope and risks for the
equity in the company the group, and the consolidation,
liquidity and other requirements for
the company and the group.
REPORT BY THE BOARD AS PER 20
CHAP. 13 § OF THE COMPANIES ACT
With reference to the proposal by the board as
above, the board hereby submits the following
report in accordance with 20 chapter 13 § of the
Companies Act.
The proposed share redemption programme
implies that the board proposes to reduce share
capital by SEK 3 520 726.55 through the withdrawal
of 997 600 shares of the A series and
11 805 042 shares of the B shares for repayment
to shareholders. The shares to be withdrawn
consist of the shares which after allocation of
the shares as above are designated redemption
shares. Payment for each redemption share
shall be SEK 11.20, which exceeds the nominal
value of the share by approx. SEK 10.93. Any
withdrawn redemption shares of the A and B
series held by the company shall be withdrawn
without repayment and such amounts shall be
allocated to free funds to be disposed of by the
annual general meeting. The total redemption
value thereby amounts to SEK 143 389 thousand,
which constitutes approx. 41 percent of
the unrestricted equity in the company and
approx. 40 percent of the equity in the group.
It can be seen from the annual report
for 2012 that the equity ratio for the group
amounts to 86 percent. The proposal by the
board implies a reduction of the share capital
in the company by SEK 3 520 726.55. To
achieve an efficient redemption process without
the need for approval from the Swedish
Companies Registration Office or general court
of law, the board proposes that the annual general
meeting decides to restore the share capital
in the company to its original amount by increasing
the share capital by SEK 3 520 726.55
through a bonus issue of shares, which means
a transfer from the unrestricted equity in the
company to the share capital in the company.
No new shares will be issued in conjunction
with the increase in share capital.
Taken as a whole the proposal of the board
as above means that dividends in the company
will be reduced by no more than SEK 143 389
thousand to approx. SEK 201 685 thousand
in accordance with the balance sheet on 31
December 2012. The restricted equity and
share capital in the company will remain unchanged
after the issue of bonus shares.
annual report 2012 |
27

Part 2 group
Consolidated income statement
(Amounts in TSEK) NOTE 2012 2011
Income from gaming operations 399 588 343 289
Other operating income 6 73 587 25 465
Total 4 473 175 368 754
Operating expenses
Running costs in gaming operations -248 917 -217 364
Other external expenses 8, 14 -21 926 -21 369
Personnel expenses 7 -86 079 -84 639
Other operating expenses 10 -322 -179
Operating profit before depreciation and write-downs 115 931 45 203
Depreciation and write-down of intangible and tangible fixed assets 9 -5 654 -5 110
Write-down of goodwill 15 -73 447 -
Total operating expenses -436 345 -328 661
Operating profit 36 830 40 093
Financial items
Interest income and other similar items 11 252 98
Interest expenses and other similar items 11 -4 410 -1 176
Total financial items -4 158 -1 078
Profit before tax 32 672 39 015
Tax 12 -1 670 -991
Profit for year from remaining operations 31 002 38 024
Discontinued operations
Profit for the year from discontinued operations 32 -624 -4 187
Profit for the year 30 378 33 837
Attributable to:
Parent company shareholders 30 396 36 030
Holdings without controlling influence -18 -2 193
Profit for period 30 378 33 837
Earnings per share, calculated on profit attributable to parent company shareholders during the year
Earnings per share after dilution
13
Earnings from remaining operations 2.42 2.97
Earnings from discontinued operations -0.05 -0.16
Earnings for the year 2.37 2.81
Earnings per share after dilution
Earnings from remaining operations 2.35 2.97
Earnings from discontinued operations -0.05 -0.16
Net income 2.30 2.81
Proposed dividend per share (SEK) 1.20 0.75
Consolidated statement of comprehensive income
(Amounts in TSEK) 2012 2011
Profit for the year 30 378 33 837
Other comprehensive income
Conversion differences -12 753 -2 182
Total other comprehensive income -12 753 -2 182
TOTAL COMPREHENSIVE INCOME
Attributable to
17 625 31 655
Parent company shareholders 17 642 33 858
Holdings without controlling influence -17 -2 203
28 | annual report 2012

Consolidated balance sheet
Assets (amounts in TSEK) NOTE 2012-12-31 2011-12-31
Fixed assets
Intangible fixed assets 15 272 164 352 994
Tangible fixed assets 16 7 263 28 685
Deferred tax claims 12, 17 17 157
Other long-term receivables 17 430 595
Total fixed assets 279 874 382 431
Current assets
Stock 608 995
Accounts receivable 19 26 580 19 574
Tax receivables 12 9 006 10 726
Other receivables 20 7 833 17 060
Prepaid expenses and accrued income 21 3 192 6 714
Liquid assets 59 057 30 457
Total current assets 106 276 85 526
TOTAL ASSETS 386 150 467 957
Equity and liabilities (amounts in TSEK) NOTE 2012-12-31 2011-12-31
Equity
22
Share capital 7 041 7 041
Other added capital 297 159 297 159
Unappropriated funds including profit for year 27 946 18 843
Equity referable to parent company shareholders 332 146 323 043
Holdings without controlling influence 89 2 443
Total equity 332 235 325 486
Long-term liabilities
Long-term interest bearing liabilities 24 1 083 8 377
Other long-term liabilities 24 - 72 825
Deferred tax liabilities 12 116 432
Total long-term liabilities 1 199 81 634
Current liabilities
Current interest bearing liabilities 26 693 7 359
Accounts payable 25 6 235 9 062
Tax liabilities 12 10 842 12 205
Other liabilities 26 11 742 15 376
Accrued expenses and prepaid income 27 23 204 16 835
Total current liabilities 52 716 60 837
TOTAL EQUITY AND LIABILITIES 386 150 467 957
Memorandum items
Pledged assets 28 6 529 10 206
Contingent liabilities None None
annual report 2012 |
29

Part 2 group
Consolidated statement of changes in equity
(Amounts in TSEK)
30 | annual report 2012
Share
capital
Equity referable to parent company shareholders
Other
added
capital
Conversion
reserves*
Unappropriated
funds including
profit for year Total
Holdings without
controlling influence
Opening equity 01-01-2011 7 041 296 736 -32 165 26 751 298 363 4 646 303 009
Comprehensive income - - - - - - 0
Profit for the year - - - 36 030 36 030 -2 193 33 837
Other comprehensive income
Conversion differences - - -2 172 - -2 172 -10 -2 182
Total other comprehensive income 0 0 -2 172 0 -2 172 -10 -2 182
Total comprehensive income 0 0 -2 172 36 030 33 858 -2 203 31 655
Contributions from and value transfers to shareholders, reported directly in equity
Option premiums - 423 - - 423 - 423
Issue costs - - - - 0 - 0
Dividends - - - -9 601 -9 601 - -9 601
Total contributions from and value transfers to
shareholders, reported directly in equity
0 423 0 -9 601 -9 178 0 -9 178
Closing equity 31-12-2011 7 041 297 159 -34 337 53 180 323 043 2 443 325 486
Opening equity 01-01-2012 7 041 297 159 -34 337 53 180 323 043 2 443 325 486
Comprehensive income - - - - - -
Profit for the year - - - 30 396 30 396 -18 30 378
Other comprehensive income - - - - - - 0
Conversion differences - - -12 754 - -12 754 1 -12 753
Total of other comprehensive income 0 0 -12 754 0 -12 754 1 -12 753
Total comprehensive income 0 0 -12 754 30 396 17 642 -17 17 625
Contributions from and value transfers to shareholders, reported directly in equity
Acquisition of minority interest - - - 1 062 1 062 -2 444 -1 382
Contribution from minority interest - - - - 0 107 107
Dividends - - - -9 601 -9 601 - -9 601
Total contributions from and value transfers to
shareholders, reported directly in equity
0 0 0 -8 539 -8 539 -2 337 -10 876
Closing equity 31-12-2012 7 041 297 159 -47 091 75 037 332 146 89 332 235
* The conversion reserve is in its entirety attributable to revaluation of net assets in foreign subsidiaries.
Total
equity

Consolidated cash flow statement
Including discontinued operations* (amounts in TSEK) NOTE 2012 2011
Operating activities
Profit after financial items
Adjustments for items not included in cash flow
32 044 35 306
- Accumulated depreciation and write-downs 82 730 11 390
- Revaluation of additional payments -73 447 -23 828
- Other items 384 -508
Income tax paid -1 335 201
Cash flow from operating activities before changes in working capital 40 376 22 561
Changes in working capital
Changes in inventories 201 97
Changes in current receivables -11 881 -2 795
Changes in current liabilities 12 495 4 990
Cash flow from operating activities 41 191 24 853
Investments
Acquisition of intangible fixed assets 15 -9 136 -1 505
Acquisition of tangible fixed assets 16 -6 097 -4 909
Disposal of tangible fixed assets 135 319
Disposal of operations 27 789 -
Outgoing payments of restaurant loans - -75
Incoming payments of restaurant loans 165 -
Cash flow from investment operations 12 856 -6 170
Financing activities
Option premiums 22 - 423
Change in long-term loans -13 339 -5 327
Dividends paid -9 601 -9 601
Minority payments -1 275 -
Cash flow from financial activities -24 215 -14 505
Change in liquid assets 29 832 4 178
Opening liquid assets 30 457 26 380
Exchange rate differences, liquid assets -1 232 -101
Closing liquid assets 59 057 30 457
Supplementary information
Unutilised credits amounted to 15 000 15 000
During the period interest received amounted to 251 85
During the period interest paid amounted to -546 -1 214
* For information concerning cash flow attributable to discontinued operations, see Note 32.
annual report 2012 |
31

Part 2 pArent compAny
Parent company income statement
(Amounts in TSEK) NOTE 2012 2011
Net sales 5 1 864 1 780
Other operating income 6 87 48
Total 1 951 1 828
Operating expenses
Other external expenses 8, 14 -4 998 -4 533
Personnel expenses 7 -7 934 -9 304
Depreciation and write-down of intangible and tangible fixed assets 9 -276 -290
Other operating expenses 10 -182 -
Total operating expenses 5 -13 390 -14 127
Operating profit -11 439 -12 299
Financial items
Result from participations in group companies 11 -3 620 51 717
Interest income and other similar items 11 210 222
Interest expenses and other similar items 11 -3 621 -1 083
Total financial items -7 031 50 856
Profit before tax -18 470 38 557
Tax 12 - -
NET PROFIT/LOSS FOR THE YEAR -18 470 38 557
Parent company statement of comprehensive income
(Amounts in TSEK) 2012 2011
Profit for the year -18 470 38 557
Other comprehensive income
Total of other comprehensive income 0 0
TOTAL COMPREHENSIVE INCOME -18 470 38 557
32 | annual report 2012

Parent company balance sheets
Assets (amounts in TSEK) NOTE 2012-12-31 2011-12-31
Fixed assets
Intangible fixed assets
Trademarks 15 182 89
Total intangible fixed assets 182 89
Tangible fixed assets
Inventories 16 190 397
Total tangible fixed assets 190 397
Financial fixed assets
Participations in group companies 17, 18 306 975 408 447
Total financial fixed assets 306 975 408 447
Total fixed assets 307 347 408 933
Current assets
Receivables from group companies 26 200 56 905
Tax receivables 12 - 15
Other receivables 20 500 452
Prepaid expenses and accrued income 21 363 542
Liquid assets 41 252 17 768
Total current assets 68 315 75 682
TOTAL ASSETS 375 662 484 615
Equity and liabilities (amounts in TSEK) NOTE 2012-12-31 2011-12-31
Equity
Restricted equity
22
Share capital 7 041 7 041
Statutory reserve 1 924 1 924
Total restricted equity 8 965 8 965
Unrestricted equity
Share premium reserve 256 391 256 391
Unappropriated profit 107 153 78 197
Profit for the year -18 470 38 557
Total unrestricted equity 345 074 373 145
Total equity 354 039 382 110
Provisions
Other provisions 23 - 71 483
Total provisions 0 71 483
Long-term liabilities
Long-term interest bearing liabilities 24 - 6 667
Total long-term liabilities 0 6 667
Current liabilities
Current interest bearing liabilities 26 - 6 667
Accounts payable 25 320 560
Liabilities to group companies 17 138 12 309
Tax liabilities 12 298 -
Other liabilities 26 205 195
Accrued expenses and prepaid income 27 3 662 4 624
Total current liabilities 21 623 24 355
TOTAL EQUITY AND LIABILITIES 375 662 484 615
Memorandum items
Pledged assets 28 8 313 21 778
Contingent liabilities None None
annual report 2012 |
33

Part 2 pArent compAny
Parent company statement of changes in equity
(Amounts in TSEK)
34 | annual report 2012
Share
capital Statutory reserve
Share premium
reserve
Unappropriated profit
including profit for year
Opening equity 01-01-2011 7 041 1 924 256 391 87 799 353 155
Comprehensive income - - - - -
Profit for the year - - - 38 557 38 557
Total of other comprehensive income 0 0 0 0 0
Total comprehensive income 0 0 0 38 557 38 557
Contributions from and value transfers to shareholders, reported directly in equity
Dividends - - - -9 602 -9 602
Total contributions from and value transfers to
shareholders, reported directly in equity
0 0 0 -9 602 -9 602
Closing equity 31-12-2011 7 041 1 924 256 391 116 754 382 110
Opening equity 01-01-2012 7 041 1 924 256 391 116 754 382 110
Comprehensive income - - - - -
Profit for the year - - - -18 470 -18 470
Total of other comprehensive income 0 0 0 0 0
Total comprehensive income 0 0 0 -18 470 -18 470
Contributions from and value transfers to shareholders, reported directly in equity
Dividends - - - -9 601 -9 601
Total contributions from and value transfers to
shareholders, reported directly in equity
0 0 0 -9 601 -9 601
Closing equity 31-12-2012 7 041 1 924 256 391 88 683 354 039
Total
equity

Parent company cash flow statement
Operating activities (amounts in TSEK) 2012 2011
Profit after financial items -18 470 38 557
Adjustments for items not included in cash flow
- Accumulated depreciation and write-downs 276 290
- Profit from sale of subsidiaries 19 982 -
- Profit liquidation of subsidiaries - -7 016
- Group contributions -11 862 -12 432
- Other* 4 182 -5
Income tax paid 476 1 895
Cash flow from operating activities before changes in working capital -5 416 21 289
Changes in working capital
Changes in current receivables 6 984 -1 308
Changes in current liabilities 14 296 8 921
Cash flow from operating activities 15 864 28 902
Investments (amounts in TSEK) 2012 2011
Acquisition of intangible fixed assets -139 -64
Acquisition of tangible fixed assets -23 -432
Disposal of shares and participations in subsidiaries 30 716 -
Liquidation of subsidiaries - 861
Cash flow from investment operations 30 554 365
Financing operations (amounts in TSEK) NOTE 2012 2011
Amortisation loans 22 -13 333 -6 666
Dividends paid -9 601 -9 602
Cash flow from financing operations -22 934 -16 268
Change in liquid assets 23 484 12 999
Opening liquid assets 17 768 4 769
Closing liquid assets 41 252 17 768
Supplementary information
Unutilised credits amounted to 15 000 15 000
During the period interest received amounted to 210 52
During the period interest paid amounted to -465 -1 083
* 2012: Other refers to current value calculation of additional purchase of SEK 1 962 thousand and discontinued operations of SEK 2 220 thousand.
annual report 2012 |
35

Part 2 notes
Note 1:
General information
Cherry AB (parent company, CIN 556210-9909)
and its subsidiaries (collectively Cherry or the
group) is a Swedish group which via subsidiaries
and partners offers fun & excitment on land
and online. Cherry offers its partners gaming,
gaming systems, personnel, equipment and expertise
on the gaming market.
Gaming operations are run via subsidiaries
at restaurant in Sweden and on the Internet
(NorgesAutomaten.com, SverigeAutomaten.com,
DanmarksAutomaten.com, PlayCherry.com, Euro-
Lotto.com and CherryAffiliates.com) from Malta.
The Maritime operations were discontinued
in November. These offered gaming at sea onboard
ships in the North Sea/Baltic, the English
Channel/the Irish sea and the Mediterranean.
The parent company is a Swedish limited
company (plc) with its head office in Stockholm.
The address of the company is Blekholmstorget
30, SE-111 64 Stockholm. The parent
company B-share is listed on AktieTorget.
This annual report and consolidated financial
statements have been approved for publication
by the board on 6 April 2013 and will be presented
to the annual general meeting on 7 May
2013 for adoption.
Note 2:
Accounting principles
GENERAL ACCOUNTING PRINCIPLES
The group applies IFRS.
The consolidated financial statements have
been prepared in accordance with the Swedish
Annual Accounts Act, RFR 1 Supplementary
Accounting Regulations for Groups, International
Financial Reporting Standards (IFRS)
and interpretations from IFRIC, such as have
been approved by the Commission of the European
Communities for application in the EU.
The parent company applies the same accounting
principles as the group, with the exception
of in those cases indicated below in the
section “Parent company accounting principles”.
The applied accounting principles correspond
with those applied in the previous year,
with the exception of the following.
NEW AND CHANGED STANDARDS
APPLIED BY THE GROUP 2012
As of 1 January 2012 the group will apply the
following new items and supplements in IFRS.
IFRS 7 “Financial instruments: Disclosures”,
changes concerning removal of financial assets
from the balance sheet.
IAS 12 “Income taxes” changes concerning
reporting of deferred tax depending on whether
36 | annual report 2012
the reported value of assets will be recovered
by means of use in operations or through sale.
None of the IFRS or IFRIC interpretations,
which for the first time are mandatory for the
fiscal year that began on 1 January 2012, have
had any essential impact on the group.
NEW STANDARDS, CHANGES AND INTER-
PRETATIONS OF EXISTING STANDARDS
THAT HAVE STILL NOT COME INTO FORCE
AND WHICH HAVE NOT BEEN APPLIED IN
ADVANCE BY THE GROUP
Several new standards and changes of interpretations
and existing standards came into
force in the fiscal year that begins after 1 January
2012 and have not been applied during the
preparation of the consolidated financial statements.
None of these are expected to have any
essential impact of the consolidated financial
statements, with the exception of the following:
In IAS 1 “Structure of financial statements”
changes have been introduced concerning
other comprehensive income. The most important
change in the changed IAS 1 is the
requirement that the items reported in “other
comprehensive income” should be presented
as divided into two groups. This allocation is
based on whether the items may come to be
reclassified in the income statement (reclassification
adjustments), or not. The change does
not consider the issue of which items should
be included in “other comprehensive income”.
IFRS 13 “Fair value measurement” is to ensure
that valuations to fair value will be more
consistent and less complex in that the standard
provides an precise definition and mutual
source in IFRS for fair value valuations and
related disclosures. The standard provides
guidance for fair value valuations for all types
of assets and liabilities, financial and nonfinancial.
This requirement does not expand
the application area for when fair value should
be applied, but provides guidance around how
it should be applied when other IFRS already
require or permit valuation to fair value.
IAS 19 “Remuneration to employees” was
changed in June 2011. Costs for employment
in previous years will not be reported immediately.
Interest expenses and expected yields on
administration assets will be replaced by a net
interest calculated with the help of the discount
interest, based on the net surplus or net deficit
in the defined benefit plan. The group has still
not evaluated the effect.
IFRS 9 “Financial instruments” concerns
the classification, valuation and recognition
of financial liabilities and assets. IFRS 9 was
issued in November 2009 for financial assets
and in October 2010 for financial liabilities,
and replaces the parts in IAS 39 related to
classification and valuation of financial instruments.
IFRS 9 specifies that financial assets
should be classified in two different categories;
valuation to fair value, or valuation to accrued
acquisition value. Classification is determined
on the first accounting occasion on the basis
of the company’s business model and characteristic
attributes in the contractual cash flows.
No significant changes have occurred for financial
liabilities in comparison with IAS 39. The
main amendment refers to liabilities that are
identified to fair value. For these, the part of the
change in fair value attributable to the credit
crisis will be recognized in other comprehensive
income instead of income, in so far as this
does not lead to an accounting mismatch. The
group intends to apply the new standard by
the fiscal year that starts on 1 January 2015 and
has therefore not yet evaluated the effects. The
group will assess the effects of the remaining
phases concerning IFRS 9 when they are completed
by IASB.
IFRS 10 “Consolidated financial statements”
is based on already existing principles
when it identifies control as the decisive factor
to determine if a company should be included
in the consolidated financial statements. The
standard provides further guidance to assist
with the establishment of control when this
is difficult to assess. The group intends to apply
IFRS 10 for the fiscal year that begins on
1 January 2013 and has still not assessed the
full effect on the financial statements.
IFRS 12 “Disclosures of interests in other
entities” includes disclosure requirements for
subsidiaries, joint arrangements, associated
companies and non-consolidated structured
companies. The group intends to apply IFRS
12 for the fiscal year that begins on 1 January
2013 and has still not assessed the full effect on
the financial statements.
None of the other IFRS or IFRIC interpretations
that have so far not come into force are
expected to have any essential impact on the
group.
APPLIED VALUATION PRINCIPLES
Assets and liabilities are reported at historic
acquisition values, with deductions for value
depreciation and write-downs in those cases
where this is applicable. Some financial instruments
are valued to their fair value.
Fixed assets and long-term liabilities consist
of amounts that are expected to be recovered or
paid after more than twelve months from the
balance sheet date. Current assets and current
liabilities consist of amounts that are expected
to be recovered or paid within twelve months
from the closing of the accounts.

FUNCTIONAL AND
REPORTING CURRENCY
The parent company uses Swedish kronor (SEK)
as its functional currency, which is also used
as the reporting currency for the group and
the parent company. Financial reports are
therefore presented in Swedish kronor and all
amounts are, unless otherwise stated, rounded
off to the nearest thousand.
FOREIGN CURRENCY
TRANSACTIONS AND BALANCE SHEET
ITEMS IN FOREIGN CURRENCY
Transactions in foreign currency are converted
to the functional currency according to the exchange
rates applicable on the transaction date,
or the date when the items are re-valued. Exchange
rate profits and losses incurred during
the payment of such transactions are reported
in the income statement as other operating income
or other operating expenses.
Receivables and liabilities related to operations
in foreign currency are valued at the yearend
rate. Exchange rate differences incurred
during conversion are reported in the income
statement as other operating income or other
operating expenses.
Currency rate profits and losses attributable
to loans and liquid assets are reported in the income
statement as financial income or expenses.
CONVERSION OF FOREIGN OPERATIONS
Assets and liabilities in foreign operations are
converted in the consolidated financial statements
from the functional currencies of the
operations at the year-end rates. Earnings and
costs are converted at the average rate for the
year. The currency rates are taken from the
Riksbank. Conversion differences incurred
during conversion are reported in other comprehensive
income and accumulated in a separate
component in equity, designated conversion
differences.
Goodwill and adjustments of fair value incurred
during the acquisition of a foreign operation
are treated as assets and liabilities for this
activity, and are converted at the year-end rate.
Exchange rate differences are reported in other
comprehensive income.
ASSESSMENTS AND ESTIMATES
The preparation of financial statements in
accordance with IFRS requires the executive
management to make assessments and estimates
and to make assumptions that influence
the application of the accounting principles
and reported amounts for assets, liabilities,
earnings and costs.
Estimates and assumptions are regularly reviewed
and based on historical experience and
other factors, including expectations of future
events, that are considered to be justified in
the prevailing conditions. The results of these
estimations and assumptions are used to assess
the reported values of assets and liabilities,
which otherwise would not be clear from other
sources. The actual result can deviate from
these estimations and assessments.
During the preparation of Cherry’s consolidated
financial statements the board and the
CEO have come to the conclusion that the valuation
of gaming agreements and concessions,
customer and restaurant receivables and the
write-down of goodwill are the critical areas
where other estimates and assessments would
have an effect on the financial position and
results.
WRITE-DOWNS
When the group assesses the write-down requirements
for gaming agreements and concessions
the utility value is assessed on the basis
of forecast future cash flows from the cash
generating units defined as ventures. The most
important assumptions in these calculations
refer to the expected rate of growth of turnover
and development of the operating margin.
The write-down requirement for goodwill
is assessed annually be comparing the recovery
value with the reported value of the asset.
The most important assumptions in these calculations
refer to the expected rate of growth
of turnover, growth rate or forecast period,
and interest. Write-downs of goodwill are not
restored. For a description of write-downs of
goodwill in 2012, see Note 15.
CUSTOMER AND RESTAURANT RECEIVABLES
Customer and restaurant receivables constitute
an important part of Cherry’s balance sheet.
Provisions for uncertain receivables are based
on the credit worthiness of the debtor and
the amount that expected to be received. For
a more detailed description of the executive’s
assessment of customer and restaurant receivables,
see Note 19 and 20.
SUPPLEMENTARY PAYMENTS
In conjunction with the acquisitions made in
recent years the acquisition price has been made
up of supplementary payments paid during an
agreed time after the acquisition, and based on
the development of turnover and earnings and
other parameters. The executive assess on a regular
basis the expected result of supplementary
payments. The fair value of conditional purchase
amounts is estimated through the application
of the so-called productive value method.
The estimates are based on a discount rate of
interest with the assumption of an expected re-
sult of the supplementary payment.
As of 31 December 2012 there were no supplementary
payments related to the acquisitions
of the last few years that would involve payments
in the future. The terms and conditions
required for payment have not been achieved
and the revaluation of previously reported liabilities
is reported in the income statement as
other operating income.
CONSOLIDATED FINANCIAL
STATEMENTS – GROUNDS FOR
CONSOLIDATION
The consolidated financial statements include
the parent company Cherry AB and all the
subsidiaries. The subsidiaries are all the companies
where the group is entitled to arrange
financial and operative strategies with a view to
achieving financial benefits, in a way normally
employed for a shareholding of more than half
of the voting rights. Subsidiaries are included
in the consolidated financial statements as of
the date the controlling influence is transferred
to the group. They are excluded from the consolidated
financial statements as of the date
when the controlling influence is no longer
valid.
The group applies the acquisition method
for acquisitions.
ACQUISITIONS 2010 AND LATER
All payments to acquire a business operation
are reported at the fair value on the date of acquisition.
The revaluation of any supplementary
payments over and above what was assessed at
the time of the acquisition is reported in the
income statement. Holdings without a controlling
interest in the acquired business can
optionally for each acquisition be valued at either
the fair value or the proportional share of
the net assets in the acquired business, which
are held without controlling interest. All acquisition
related transaction costs are recognised
and reported in the consolidated income statement
as sales and administration expenses.
The excess consisting of the difference between
the acquisition value and the fair value
of the group’s share of identifiable acquired
assets, liabilities and contingent liabilities is
reported as goodwill.
ACQUISITIONS 2009 AND EARLIER
All payments to acquire a business operation
are reported at the fair value on the date of acquisition.
The revaluation of any supplementary
payments over and above what was assessed
at the time of the acquisition is adjusted in relation
to the acquisition value. All acquisition related
transaction costs are reported as a part of
the acquisition value for the acquired business
annual report 2012 |
37

Part 2 notes
operations. If the cost of the acquisition of the
company exceeds the fair value of the identifiable
assets, liabilities and contingent liabilities,
the difference is reported as goodwill. If the fair
value of the acquired net assets exceeds the cost
of the acquisition, the identification and calculation
of the value of the acquired net assets
will be reassessed. Any excess amounts after
this reassessment are immediately reported in
the income statement.
The consolidated income statement includes
the income statements for the parent
company and the directly or indirectly owned
subsidiaries after the elimination of internal
group transactions and depreciation of revaluations
made in conjunction with acquisition.
The earnings and costs of subsidiaries are
included in the consolidated financial statements
from the date the controlling influence
arises (acquisition date) and the date it ceases.
Internal group receivables and liabilities, including
transactions between companies in the
group and thereby associated profits, are eliminated
in their entirety.
HOLDINGS WITHOUT
CONTROLLING INFLUENCE
Holdings without controlling interest are reported
in the consolidated statement of the financial
position in equity, separately from the
equity of parent company owners.
Receivables in parent company ownerships
in subsidiaries that do not lead to a loss of the
controlling influence are reported as equity
transactions. The reported values for the holdings,
with and without controlling influence,
are adjusted so that they reflect changes in
their relative holdings in the subsidiary. Any
differences between the amount with which
the holding without controlling influence is adjusted
and the fair value of the paid or received
compensation are reported directly in equity
and allocated to parent company shareholders.
REPORTING OF DISCONTINUED
OPERATIONS
Cherry applies IFRS 5 Fixed assets held for sale
and discontinued operations. IFRS 5 implies
that such operations are reported separately
from remaining operations in the consolidated
income under the heading “Result from discontinued
operations”. Comparative periods
have been re-valued correspondingly.
In the consolidated financial statements for
2012, the Maritime operations have been reported
as discontinued. Note 32 indicates the
effects of these adjustments for 2012 and 2011
in the income statement.
38 | annual report 2012
REPORTING OF BUSINESS AREAS
Group operations are divided up into business
areas on the basis of which parts of the operations
the company’s highest executive follows
up, the so-called management approach, or
executive perspective. In this annual report we
have chosen to call segments for business areas
in accordance with IFRS 8. The basis for the
division of the business areas corresponds with
the group’s operative structure and the internal
reporting to the CEO and the board.
Cherry’s business areas are divided up into
Online Gaming and Restaurant Casino. The
business area Maritime Gaming has been disposed
of in 2012 and is reported in discontinued
operations. Cherry also runs several development
projects. Up until the time the product
or service is launched these costs are reported
under the heading “Joint and other” in the
business area reporting to clarify what the respective
business areas in the group generate.
EARNINGS
Earnings are reported in the income statement
when in all probability the future financial benefits
will accrue to the group and these benefits
can be calculated in a reliable way. Earnings in
the group consist of gaming income, consultancy
and service income, licence revenues and
other revenues.
EARNINGS FROM GAMING ACTIVIES
This item includes gaming income and consultancy
and service income.
Earnings from gaming activities in the
group are reported net after deductions for
player winnings, and for poker, casino, gaming
and bingo after deductions for player winnings,
bonuses and loyalty programmes. Gaming income
is reported when payment is received,
because this concurs with the date when the
gaming/service took place or was delivered.
Assignments in consultancy and service
activities are normally of short duration and income
from these is reported when the assignment
has been completed.
Internal group sales are eliminated in the
consolidated financial statements.
OTHER OPERATING INCOME
Other operating income mainly includes licence
revenues, recovered write-downs of receivables,
exchange profit in operations and
the results of sales of fixed assets. Licence revenues
are periodised linearly over the period the
revenues refer to. Other earnings are reported
when the risks and benefits associated with the
ownership rights have been transferred to the
buyer and the earned amount can be calculated
reliably.
RUNNING COSTS IN
GAMING OPERATIONS
Running costs in gaming operations for Restaurant
& Event Casino and Maritime Gaming
refer to gaming shares to venues and shipping
companies, gaming tax, licence fees, purchased
materials and purchased services directly related
to gaming operations.
Running costs in gaming operations for
Online Gaming refer to shares to gaming operators,
support, and purchased services directly
related to gaming operations.
Running costs in gaming operations are
periodised in line with delivery of the gaming
or service.
WRITE-DOWNS
Assessment of the residual value of assets and
useful period is carried out on an annual basis.
If there is an indication that tangible or
intangible assets with a fixed useful period, or
financial fixed assets in the group, have an excessively
high book value, then an analysis is
made where the recovery value is determined
for individual or naturally associated types of
assets. If the reported value exceeds the calculated
recovery value, this value is immediately
written-down.
For intangible assets with an indeterminate
useful period and intangible assets that are still
not ready for use, the recovery value is determined
every year. Write-downs are reported
when an asset’s reported value exceeds the recovery
value.
A write-down is reversed if there has been a
change in the circumstances used to determine
the recovery value, with the exception of writedowns
of goodwill which are not recovered.
A reversal is made at the most up to a value
that does not exceed the book value that should
have been reported, with deduction for depreciation,
if no write-down should have been made.
Write-downs are included in the income
statement item, Depreciation and write-downs.
TAXES
Income tax reported in the income statement
includes the actual tax, i.e. the tax that should
be paid or received in the year, adjustments for
tax in previous years, and deferred tax.
Items reported in the income statement
therefore include such related tax effects. Items
reported directly to equity include associated
tax effects directly to equity.
The valuation of all tax liabilities and receivables
is made at nominal amounts and in
accordance with the stipulated tax regulations
and tax rates, or those that have been advised
and will in all probability be applied.
Deferred tax is calculated in accordance

with the balance sheet method on the basis of
temporary differences between reported and
tax values of assets and liabilities, with the application
of the tax rates and tax regulations that
are decided or advised at the year-end. Temporary
differences are not taken into consideration
in group-wide goodwill, nor in differences
attributable to participations in subsidies and
associated companies, which are not expected
to be taxed within the foreseeable future.
Deferred tax receivables concerning deductible
temporary differences and deficit deductions
are only reported to the extent that it
is likely that they will be utilised and result in
lower tax payments in the future. The determining
factor for whether a deferred tax receivable
concerning a deficit deduction will be
reported or not is whether an assessment can
be made of how likely it is that the group will
be able to utilise it for settlement in relation to
future taxable profits. Consideration is taken in
this context to expected taxable income in coming
periods and the opportunity of legal set-off
in relation to profits in companies in the same
country.
FINANCIAL ASSETS AND LIABILITIES
Cherry classifies its financial instruments in
the following categories:
1. Loans receivable and other receivables.
2. Financial assets or liabilities at fair value
via the income statement.
3. Other financial liabilities.
4. Financial assets and liabilities that can be sold.
1. CLASSIFICATION AS “LOANS RECEIVABLE
AND ACCOUNTS RECEIVABLE”
Operating receivables, including accounts receivable,
are classified as “Loans receivable
and accounts receivable” are valued to the accrued
acquisition value. In the balance sheet
these are reported as accounts receivable and
liquid assets, with the exception of items with
a due date more than twelve months after the
balance sheet date, which are classified as financial
fixed assets. Bank balances and loans
receivable and accounts receivable are valued at
the accrued acquisition value. Returns on bank
balances and short-term investments are reported
as financial income in the consolidated
income statement.
The value of loans receivable and accounts
receivable is reviewed on a regular basis and
write-downs are reported in operating expenses.
2. CLASSIFICATION AS “FINANCIAL ASSETS/
LIABILITIES VALUED AT FAIR VALUE VIA
THE INCOME STATEMENT”
When assets in this category are held, changes
in value are reported on a regular basis at fair
value. The revaluation of derivatives held to
minimise transaction risks for the operative
business is reported in operating profit, and
derivatives held to minimise transaction risks
for the financial business are reported in net
finance. A financial asset is classified in this
category if it is held for trading purposes, i.e.
has mainly been acquired with a view to disposal
in the short term, or if the group executive
has classified it as such. Cherry has not held
any assets classified in this category during the
reported periods. When liabilities in this classification
are held they are reported in the same
way as “Financial assets valued to fair value
via the income statement”. Liabilities in this
category refer to the allocation of supplementary
payments, which are reported as other longterm
liabilities in the balance sheet.
3. CLASSIFICATION AS “OTHER
FINANCIAL LIABILITIES”
This category includes loan liabilities and accounts
payable. Liabilities in this category are
valued to the accrued acquisition value with
the application of the effective interest method.
Loan liabilities are also reported initially at the
received amount after deduction for transaction
costs. If the fair value differs from what should
be repaid on the due date, the loan liability is
then reported to the accrued acquisition value,
which means that the difference is periodised
in accordance with the effective interest method
as an interest expense. Cherry applies IAS 23,
Loan expenses. In accordance with this standard
loan expenses referring to borrowing directly
attributable to acquisition, performance and
production of qualified assets, are included as
part of the acquisition value of the investment.
Cherry has, however, no borrowing attributable
to such investments at the present time, which
is why costs for borrowing are charged to the
income statement. Loan liabilities, short-term
investments and liquid assets are reported in
accordance with the business date principle.
Borrowing is classified as short-term liabilities
if the group does not have an unconditional
right to defer payment of the debt for at least
twelve months after the balance sheet date.
4. CLASSIFICATION AS “FINANCIAL ASSETS
THAT CANNOT BE SOLD”
Cherry has no financial liabilities or assets
classified in this category.
On the balance sheet date there were no tangible
differences between book value and fair
value in the group’s assets and liabilities. For
allocation in respective category, see Note 29.
INTANGIBLE FIXED ASSETS
GOODWILL
Goodwill corresponds to the positive difference
between the acquisition price and fair
value of the group’s share of the identifiable
net assets in the acquired company or business
operation as of the date of acquisition. Because
goodwill has an indeterminate useful period it
is reviewed annually in relation to write-down
requirements and is reported at its acquisition
value with the deduction of any accumulated
write-downs. Profits and losses in conjunction
with the disposal of companies include the
book value of the goodwill that is attributable
to discontinued company. Write-downs of goodwill
are not restored.
Goodwill is allocated to cash-generating
units during the examination of any writedown
requirements. This allocation is made
to the cash-generating units or groups of
cash-generating units, determined in accordance
with the group’s operating segments,
which are expected to benefit from the acquisition
where the goodwill item arose.
OTHER INTANGIBLE FIXED ASSETS
Other intangible assets include acquired gaming
agreements and concessions, trademarks
and development costs. The intangible assets
are reported in the balance sheet at the acquisition
value, with deductions for accumulated
depreciation and write-downs. Depreciation is
based on the original acquisition value, reduced
by the estimated residual value and taking into
write-downs made.
Linear depreciation is applied over the useful life
of the assets as follows:
Acquired gaming agreements and
concessions
Trademarks
Development costs
Tenancy rights
annual report 2012 |
3-6 years
5 years
2-5 years
7 years
39

Part 2 notes
TANGIBLE FIXED ASSETS
Tangible fixed assets are reported at their
historic acquisition cost after deduction for
accumulated depreciation and any writedowns.
Repairs and maintenance are recognised
on a regular basis. Depreciation is based
on the original acquisition value, reduced by
the estimated residual value and taking into
write-downs made.
Linear depreciation is applied over the useful life
of the assets as follows:
Slot machines in use
3-10 years
Product gaming
2 years
Recreational gaming
2-5 years
Casino tables
5 years
Casino wheels, Sweden
3-5 years
Scanning system (maritime slot machines) 3-5 years
Registering equipment (Swedish casino) 3 years
Other gaming inventories
max 5 years
Office inventories
5 years
Computers
3 years
Vehicles
3-5 years
INVENTORIES
Inventories are valued at the lower of the acquisition
cost after the requisite deduction for obsolescence
and net sales value. The acquisition
value for the inventory is calculated through
the application of the FIFO method.
LEASING
Leasing is classified as either financial or operational
leasing.
Leasing where an essential part of the risks
and advantages of the ownership are retained
by the lessor is classified as operational leasing.
Payments made during the leasing period
(after deductions for any incentives from the
lessor) are recognized in the income statement
linearly over the leasing period.
The group leases some tangible fixed assets.
Leasing agreements of fixed assets where the
group essentially holds the financial risks and
advantages associated with the ownership is
classified as financial leasing. At the start of the
leasing period financial leasing is reported in
the balance sheet at the lower of the fair value
of the leasing object and the current value of
minimum lease charges.
Each leasing payment is allocated between
amortisation of the liability and financial expenses.
The corresponding payment obligations,
after deduction of financial expenses, are
included in the balance sheet items Long-term
borrowing and Short-term borrowing. The interest
part in the financial expenses is reported
in the income statement, allocated over the
leasing period so that each accounting period
is charged with an amount that corresponds to
40 | annual report 2012
a fixed interest rate for liability reported during
respective periods. Fixed assets held in accordance
with financial leasing agreements are
written-down during the shorter period of the
asset’s useful life and leasing period.
The scope of Cherry’s operational leasing
agreements is reported in Note 14 and financial
leasing agreements are indicated in Note 16.
REMUNERATION TO EMPLOYEES
SHORT-TERM REMUNERATION
Short-term remuneration to employees is calculated
with discounting and reported as an
expense when the related services are received.
A provision for estimated bonus payments and
other contractual compensation is reported
when the group has legal or informal obligations
to make such payments as a result of the
fact that the services in question have been received
from the employees and the provision
amount can be estimated reliably.
PENSION COMMITMENTS
Pension plans are financed through payments
from respective group companies and in some
cases from the employees. All pensions are
reported as defined contributions. Group payments
concerning defined contribution pension
plans are recognised during the period
the employees have performed the services to
which the contributions refer. Pensions for employees
who have chosen the opportunity of an
alternative ITP and pensions for croupiers and
dealers are defined contributions.
Pension commitments for some the company’s
employees are secured through insurance
in Alecta. Alecta’s surplus can be distributed to
policy holders and/or the insured. At the end of
2012, Alecta’s surplus amounted in the form of
the collective consolidation level to 130 percent
(preliminary data, the last previous year it was
143 percent). The collective consolidation level
consists of the market value of Alecta’s assets
in percent of the insurance commitments calculated
in accordance with Alecta’s insurance
undertakings, which do not correspond with
IAS 19.
COMPENSATION ON NOTICE OF TERMINATION
Compensation on the termination of employment
is paid when an employee is given notice
by the company prior to the normal pension
date, or when an employee accepts a voluntary
retirement from in exchange for such compensation.
The group reports severance pay
when it is manifestly obliged to give notice to
an employee in accordance with a detailed formal
plan without the opportunity of recall. In
the event the company has issued an offer to
encourage voluntary retirement, the severance
pay is based on the number of employees who
are estimated to accept the offer. Benefits due
more than 12 months after the end of the reporting
period are discounted to current value.
INCENTIVE PROGRAMME
The 2011–2014 incentive programme for the
Cherry group does not come under IFRS 2 and
share related compensation. Employees are offered
options at market prices.
PROVISIONS
A provision is reported in the balance sheet
when the group has an existing legal or informal
obligation as a result of an event that has
occurred, and where it is likely that an outflow
of financial resources will be needed to regulate
the obligation and it is possible to make
a reliable estimation of the amount. A provision
for restructuring is reported when the
group has established a detailed and formal
restructuring plan, and the restructuring has
either been begun or has been officially acknowledged.
Provisions are reported in the balance
sheet under other current and long-term
liabilities. When the outflow of resources is
estimated to take place later than one year after
the balance sheet date, the expected future cash
flow is discounted and the provision is reported
at capitalised value.
CASH FLOW STATEMENT AND
DEFINITION OF LIQUID ASSETS
The cash flow statement is prepared in accordance
with the indirect method. The reported
cash flow only included transactions that permit
incoming or outgoing payments. Liquid
assets are classified as cash and bank balances
with a term shorter than three months, and
which are only exposed to a negligible risk of
fluctuations in value.
PARENT COMPANY
ACCOUNTING PRINCIPLES
The parent company accounting is prepared
in accordance with the Annual Accounts Act
and RFR 2 Accounting regulations for legal
entities. The parent company applies the same
principle as the group, with the exception
of the following. The principles remain unchanged
in comparison with previous years,
unless otherwise stated in Changes in accounting
principles.
Deviations between group and parent company
accounting principles are motivated by
the limitations the Annual Accounts Act imposes
in the application of IFRS in the parent
company and the tax regulations that enable
different accounting for legal entities than for
the group.

CHANGES IN ACCOUNTING PRINCIPLES 2012
Unless otherwise stated below the parent
company accounting principles in 2012 have
changed in line with what has been specified
for the group.
GROUP CONTRIBUTIONS AND SHARE-
HOLDER CONTRIBUTIONS
The parent company reports group contributions
received in accordance with the same
principle as ordinary dividends, i.e. as a financial
income. Group contributions are reported
as financial expenses. Shareholder contributions
are made directly to equity at the recipient
and activated in shares and participation at the
issuer, in so far as there are no write-downs.
FINANCIAL POLICY
The group’s financial operations are conducted
on the basis of the financial policy established
by the board and is characterised by a low level
of risk. Financial operations and the management
of financial risks are coordinated via the
parent company Cherry AB, which is also responsible
for the placement of excess liquidity.
Financing of subsidiaries mainly takes place via
the parent company and a cash pool, to which
all Swedish companies are linked. The operational
subsidiaries manage their own financial
risks within the framework established by the
board and in coordination with the parent
company. Disclosures on Cherry’s financial risk
management reflect the information issued
internally to leading executives.
CURRENCY EXPOSURE RISKS
The group is exposed to changes in the foreign
exchange rate as some of its sales take place
in currencies that differ from the costs (transaction
exposure). Results are also affected by
changes in foreign exchange rates when the
results of the foreign subsidiaries are converted
to Swedish kronor (translation exposure).
Group equity is also affected by changes in foreign
exchange rates when the assets and liabilities
in foreign subsidiaries are recalculated to
GROUP COMPANIES
Participations in group companies are reported
in the parent company at the acquisition value,
reduced by any write-downs. Conditional proceeds
are valued on the basis of the likelihood
that they will be received. Any changes in the
provision/receivable are added to, or reduce
the acquisition value.
DIVISION INTO RESTRICTED
AND UNRESTRICTED EQUITY
In the parent company balance sheet equity is
divided up into restricted and unrestricted equity
in accordance with the Annual Accounts Act.
Note 3: Financial risk management
Swedish kronor (translation exposure).
All the earnings of the business area Online
Gaming are in euro and majority of its costs
are also in euro. Cherry does not implement
hedging for this part at present.
Foreign companies are mainly financed
through equity and intergroup loans, which are
issued either in the parent company currency
or in the currency of the subsidiary. Hedging
of equity in foreign subsidiaries is not implemented.
If the Swedish currency fell by 5 percent
in relation to the euro, with all other variables
constant, profit after tax on 31 December 2012
would have been SEK 1.6 million higher mainly
as a result of gains from the conversion of the
results from Online Gaming.
Earnings items in foreign group and associated
companies are not hedged.
Exchange rates used in consolidated
financial statements
Average rate 2012 2011
EUR 8.71 9.03
GBP 10.73 10.41
Closing rate (Ultimo) 2012 2011
EUR 8.62 8.94
GBP 10.49 10.68
ANTICIPATED DIVIDENDS
The parent company reports anticipated dividends
from subsidiaries in those cases where
the parent company has the sole right to the
scope of the host transfer and if the parent
company has taken a decision on the scope
of the dividend before its financial reports
are published. No anticipated dividends were
reported in the annual accounts for the fiscal
year of 2012.
REFINANCING RISKS,
LIQUIDITY RISKS AND
CAPITAL MANAGEMENT
Group operations are mainly financed with their
own resources. As of the year end 31-12-2012
the group had no loans apart from financial
leasing. Cherry also has a standing overdraft
facility in Sweden for SEK 15 million.
The table below shows group liabilities allocated
by the time remaining to the contractual
due date. The amounts shown in the table are
the contractual, non-discounted cash flows.
Cherry has traditionally aimed for a low
level of debt with an equity ratio of at least 30
percent. The tangible fixed assets in the group
mainly consist of gaming and gaming equipment.
Future investments in tangible fixed assets
are mainly estimated to be financed with
internally generated resources. There may be a
need for external financing in the event of any
major acquisitions of companies. The objective
is primarily to implement acquisitions through
cash payment and, or the issue of shares.
INTEREST RISKS
Group earnings and cash flows from operations
are essentially independent of changes in
interest levels on the market. Excess liquidity
in the group is banked in accordance with
As of 31 December 2012 Less than 3 months From 3 months to 1 year From 1 to 2 years From 2 to 5 years More than 5 years
Acquisition loan - - - - -
Other long-term liabilities - - - - -
Financial leasing 172 520 1 083 - -
Accounts payable and other
liabilities
12 865 15 954 - - -
annual report 2012 |
41

Part 2 notes
group finance policy. Short terms are applied.
With the exception of financial leasing, Cherry
had no interest bearing loans as of 31-12-2012.
COUNTERPARTY RISKS AND CREDIT RISKS
Cherry has no essential concentration of credit
risks. The company estimates that it has more
than 200 customers in its business operations.
No single customer accounts for more than
10 percent of group sales. Concerning Online
Gaming, Cherry bears the responsibility for
any credit risks of customers and also for any
jackpots.
Cherry has its own platform for Online
Gaming, as well as white label solutions. For
white label solutions, Cherry’s partners are
responsible for all the credit risks of customers
and for any jackpots, where provisions are
made monthly. Concerning its own platform,
Cherry is responsible for credit risks and
jackpots. Provisions are also made monthly for
jackpots. Individual units in respective business
areas may, however, have a larger exposure to
individual customers. All jackpots are randomly
generated. Depending on the results, earnings
and profit may be affected in the short term.
Cherry has several partners who pay on a
monthly basis. There is risk of one or more of
these partners become insolvent and failing to
pay their debts to Cherry.
Cherry issues advance payments, so-called
restaurant loans, to some of the customers in
the group, which is a natural part of Cherry’s
gaming operations in Restaurant Casino. The
terms and conditions for repayment rates are
agreed individually with respective restaurant
42 | annual report 2012
owners. Cherry receives compensation corresponding
to the market interest rate for outstanding
loans. Restaurant loans are a competitive
factor in the industry and are of important
for the outcome of the business negotiations
concerning venue agreements. Their issue
involves a credit risk. To minimise this risk
the borrower takes out security in the form of
corporate or real estate mortgages, personal
guarantees and, or other mortgaging of property.
All loan issues undergo Cherry’s credit assessment.
In 2012 a credit resolution in excess
of SEK 300 thousand was taken by the board
of Cherry, a credit resolution of SEK 150-300
thousand by the president together with the
chairman, and a credit resolution of up the
SEK 150 thousand by the president.
In Cherry’s business operations no official
independent external credit rating service is
available for customers. Nevertheless, risk assessments
of customer credit worthiness are
made on the basis of their financial position,
previous experience and other factors. Individual
risk limits are established on the basis of
internal or external credit assessments in accordance
with the limits set by the board. The
use of credit limits is followed up regularly.
The credit quality of financial assets that
neither have fallen due for payment nor are
in need of a write-down is assessed through
reference to external credit ratings (if such
are available) or to the payment history of the
counterparty.
Cash handling in the Cherry group does
take place, but has significantly diminished
now that Maritime Gaming has been discon-
tinued. The risks involved with handling cash
in Restaurant Casino have nevertheless been
reduced in that the physical handling of cash at
most of the venues is not handled by the Cherry
Group, along with the introduction of card
terminals at almost all of the Cherry venues.
This has led to a significant reduction in the
handling of cash. In those cases where cash
handling does take place, most of the handling
is managed by our partners, i.e. restaurants,
hotels and night clubs. This does involve a
credit risk for Cherry. Reversal accounting of
internal control systems is used minimise this
risk, which quickly detects deviations. Security
companies such as Nokas, Loomis and others
are often used in those cases where Cherry
handles cash.
TAX RISKS
Cherry conducts its business operations
through subsidiaries in Malta, Gibraltar and
Sweden. Operations, including transactions
between group companies, are managed in accordance
with the company’s interpretation of
current tax laws, gaming agreements and regulations,
or by the interpretation of them by the
government agencies concerned. In addition,
these regulations can change, possibly with a
retroactive impact. The decisions of tax authorities
can have a negative effect on the previous
or current tax situation for the group. The company
and its subsidiaries are, in so far as this
can be known, not currently the object of any
form of tax audit.

Note 4: Reporting per business area
2012
Restaurant
Casino
Online
Gaming
Group-wide and
development projects
Discontinued operations
Maritime Gaming
annual report 2012 |
Total for
the group
Profit/loss
External income 134 526 265 115 87 - 399 728
Revaluation of supplementary proceeds - 73 447 - - 73 447
Intergroup income 7 2 313 1 863 - -
Total income 134 533 340 875 1 950 0 -
Operating profit (EBIT) 12 345 33 643 -9 158 - 36 830
Profit before tax - - - - 32 672
Profit after tax from remaining operations - - - - 31 002
Profit from discontinued operations - - - -624 -624
Net profit after tax - - - - 30 378
Other disclosures
Assets 19 304 325 335 41 511 - 386 150
Liabilities -22 713 -24 676 -6 526 - -53 915
Company acquisitions 2 500 - - - 2 500
Other investments 1 319 5 307 3 859 2 248 12 733
Depreciation and write-downs -2 670 -76 036 -395 -3 629 -82 730
2011
Restaurant
Casino
Online
Gaming
Group-wide and
development projects
Discontinued operations
Maritime Gaming
Total for
the group
Profit/loss
External income 125 819 219 059 48 - 344 926
Revaluation of supplementary proceeds - 23 828 - - 23 828
Intergroup income - 3 223 1 780 - -
Total income 125 819 246 110 1 828 0 -
Operating profit before depreciation (EBITDA) 11 992 43 412 -10 962 - 45 203
Operating profit (EBIT) 10 182 41 086 -11 925 - 40 093
Profit before tax - - - - 39 015
Profit after tax from remaining operations - - - - 38 024
Profit from discontinued operations - - - -4 187 -4 187
Net profit after tax - - - - 33 837
Other disclosures
Assets 20 003 384 493 19 374 44 087 467 957
Liabilities -19 276 -108 068 -5 378 -9 749 -142 471
Company acquisitions 264 - - - 264
Other investments 697 2 563 496 2 394 6 150
Depreciation and write-downs -2 483 -2 325 -290 -6 292 -11 390
For definition of business segments and group-wide and development projects, see page 22 in the annual report.
For further information on discontinued operations, see Note 32.
SALES, ASSETS AND INVESTMENTS PER GEOGRAPHICAL AREA
2012 Scandinavia Rest of Europe Group
External income 333 449 66 279 399 728
Assets 56 619 329 531 386 150
Company acquisitions 2 500 - 2 500
Other investments 2 722 10 011 12 733
2011 Scandinavia Rest of Europe Group
External income 302 447 42 479 344 926
Assets 58 440 409 517 467 957
Company acquisitions 264 - 264
Other investments 2 749 3 401 6 150
43

Part 2 notes
Note 5: Transactions with associated companies
The parent company has a close affiliation with its subsidiaries (see Note
18). Services sold to subsidiaries refer in similarity to the previous year
mainly to management services, rental and office costs, future invoiced
expenditures. Transactions with subsidiaries take place at market rates.
Remuneration the chairman of the board, board members and executives
is reported in Note 7.
None of the board members or executives in Cherry or its subsidiaries
have, or have had, any direct or indirect involvement in any business
transactions with Cherry or its subsidiaries that are, or have been, unusual
in terms of their character or conditions.
Note 6: Other operating income
44 | annual report 2012
The sellers of the Automaten group have been engaged as consultants to
Inprom Ltd on Malta.
Consultancy services have been included at market rates and in 2012
the amount of SEK 7 027 thousand (6 558) has been invoiced to Inprom
Ltd.
As of 31-12-2012 there were no receivables from or liabilities to associated
companies.
Cherry has not, nor have its subsidiaries, had or issued loans, set
guarantees or entered into personal guarantees on behalf of any of the
board members, or executives in Cherry or its subsidiaries.
Parent Company
Purchases and sales, group companies 2012 2011
Net sales of subsidiaries 1 864 1 780
Share of total earnings 100% 100%
Purchases from subsidiaries 563 750
Share of total operating expenses 0.0% 0.1%
Group Parent Company
2012 2011 2012 2011
Revaluation of condition proceeds 73 447 23 828 - -
Exchange rate differences in operations 74 1 338 41 2
Licence revenues 46 46 46 46
Recovered write-down of receivables 12 11 - -
Capital gains from sale of fixed assets 8 78 - -
Other - 164 - -
Total 73 587 25 465 87 48

Note 7: Personnel
2012 2011
Average number of employees including discontinued operations Total of which, men Total of which, men
Parent company
Sweden 4 75% 4 75%
Total for parent company 4 75% 4 75%
Subsidiaries
Sweden 132 30% 130 30%
England 7 40% 20 40%
Greece 25 29% 28 29%
Malta 30 50% 12 50%
Poland 6 0% 9 0%
Total for subsidiaries 200 30% 199 30%
Group total including discontinued operations 204 30% 203 31%
The average number of employees in discontinued operations amounted to 44 66
Group Parent Company
Salaries, other compensation and payroll overhead 2012 2011 2012 2011
Board, CEO, vice CEO and other executives -6 991 -8 779 -3 030 -5 628
Other employees -59 420 -57 714 -1 535 -517
Total -66 411 -66 493 -4 565 -6 145
Of which variable remuneration to CEO, other executives -1 382 -337 -20 -21
Payroll overhead (including pension expenses) -16 440 -16 926 -2 357 -2 851
Pension expenses including payroll tax
Board, CEO, vice CEO and other executives -1 287 -1 605 -721 -939
Other employees -1 893 -1 406 -94 -33
Total -3 180 -3 011 -815 -972
Of which in discontinued operations
Salaries and remuneration to executives -495 -749 - -
Salaries other employees -5 773 -9 088 - -
Payroll overhead (including pension expenses) -1 386 -1 974 - -
Pension expenses executives -116 -200 - -
Pension expenses other employees -291 -379 - -
DECISION AND DRAFTING PROCESS
Remuneration is paid to the chairman and board members in accordance
with the decision of the annual general meeting. No remuneration is paid for
committee work. No remuneration is paid to the employee representative.
The general meeting has decided on the following guidelines concerning
remuneration to executives.
Remuneration to the CEO and other executives consists of their basic
salary, variable remuneration, other benefits and pensions. Other executives
refer to the five persons who together with the CEO constitute the
group executive. For the composition of the group executive, see page 20.
The division between basic salary and variable remuneration should
stand in proportion to responsibility and authorization of the executive.
Variable remuneration for other executives is limited to SEK 200–500
thousand for 2012. The variable remuneration is based on results in relation
to individual set targets approved by the chairman. Pension benefits
and other benefits for the CEO and other executives are included as part of
the total remuneration.
annual report 2012 |
45

Part 2 notes
Remunerations and other benefits for executives in 2012
Remunerations and other benefits for executives in 2011
46 | annual report 2012
Basic
salary
Basic
salary
Variable
remuneration
* Other executives include Per-Anders Persson, Ulf Bergström, Aron Moberg-Egfors, Marius Andersen and Lars-Gunnar Persson.
For further information, see executives on page 20.
Variable
remuneration
Pension
expenses
Other
remuneration Total
Chairman of the board Rolf Åkerlind -200 - - -210 -410
Board member Kjell Berggren -100 - - - -100
Board member Per Hamberg -33 - - - -33
Board member Anders Holmgren -100 - - - -100
Board member Emil Sunvisson -58 - - -34 -92
Board member Morten Klein - - - - 0
Board member Martin Wattin -83 - - - -83
Total remuneration to the board, including to chairman -574 0 0 -244 -818
CEO Emil Sunvisson -650 - -170 - -820
Former CEO Gunnar Lind -1 011 - -458 -2 530 -3 999
Vice CEO Fredrik Burvall -854 -21 -127 - -1 002
Other executives* -2 316 -237 -375 - -2 928
Other executives in discontinued operations -670 -79 -161 - -910
Total -6 075 -337 -1 291 -2 774 -10 477
* Other executives include Per-Anders Persson, Ulf Bergström, Marius Andersen and Lars-Gunnar Persson.
For further information, see executives on page 20.
Pension
expenses
Other
remuneration Total
Chairman of the board Rolf Åkerlind -340 - - -33 -373
Board member Kjell Berggren -107 - - - -107
Board member Anders Holmgren -107 - - - -107
Board member Morten Klein - - - - 0
Board member Martin Wattin -107 - - - -107
Total remuneration to the board including to chairman -661 0 0 -33 -694
CEO Emil Sunvisson -1 491 -240 -440 - -1 931
Vice CEO Fredrik Burvall -810 -119 -140 - -970
Other executives* -3 501 -733 -361 - -4 356
Other executives in discontinued operations -495 -290 -116 - -701
Total -6 958 -1 382 -1 057 -33 -8 652

COMMENTS TO TABLE ON PREVIOUS PAGE:
• Basic salary refers to salary and other benefits, including car and fuel benefits.
• Variable remuneration refers to recognised variable remuneration, which
is based on achieved targets and is paid in 2013.
• Pension expenses refer to the cost that has affected net profit for the year
excluding payroll tax. The chairman and members of the board have not
received any remuneration in addition to the board remuneration in 2012.
• In 2011 the chairman received extra remuneration for extra commitments
concerning current operations to support the CEO.
OPTIONS PROGRAMME
At an extraordinary general meeting on 19 October 2011 the proposal by the
board to introduce an incentive programme for executives and key persons
in the Cherry group was approved. The programme involves an offer to
acquire options at market prices (as per Black & Scholes) for shares in the
B series in Cherry and 455 000 options have been subscribed to. The option
price was SEK 0.93 per option and the redemption price was set to SEK
22.94 per share. Each option entitles the acquisition of one share during the
redemption period 1–30 November 2014.
Changes in the number of outstanding share options and their weighted
average redemption price are as follows:
Average
redemption
price in SEK
per option
2012 2011
Options
(thousands)
Average
redemption
price in SEK
per option
Options
(thousands)
As of 1 January 22.94 455 000 -
Allocated 0 22.94 455 000
As of 31 December 22.94 455 000 22.94 455 000
The weighted average fair value for options allocated in 2011, determined
with the Black-Scholes valuation model, was SEK 17.64 per option. Important
input data in the model included the weighted average share price of
SEK 17.44 on the day of allocation, the above redemption price, volatility of
30 percent, and expected dividend of SEK 3.75, an expected term of 3 years
and an annual risk-free interest of 1.5 percent.
A total of 500 000 options have been issued in the programme for
2011–2014. These were subscribed free of charge by the subsidiary Cherry
Casino Syd AB and the options that were not subscribed, 45 000 options,
are still held by the subsidiary.
LOYALTY
With the objective of motivating executives, the board has decided to issue
remuneration for loyalty to be paid by 1 November 2014 to selected employees
who at the time of payment are still employed in Cherry.
The remuneration can be paid to an amount that net after tax corresponds
to a maximum of SEK 565 thousands including payroll overhead. This remuneration
including payroll overhead is recognised at the rate it is earned
during the period 1 November 2011–31 October 2014.
TERMS OF EMPLOYMENT FOR CEO
The CEO Emil Sunvission is employed until further notice, up to the age of 65.
In addition to a fixed salary the CEO has the opportunity to receive variable
remuneration. The scope of the CEO’s variable remuneration is related
to the achievement of the targets set by the board in this context.
In addition to pension benefits in accordance with the General Insurance
Act (ATP and AFP) the CEO is entitled to an extended pension premium.
Salary on which a pension is based does not include variable remuneration,
company car or other benefits. The pension is a defined contribution. No
agreement exists on the right to an early retirement pension before 65 years
of age. The pension is non-transferable.
If notice is given by Cherry, the CEO is entitled to a term of notice of six
months and severance pay corresponding to 12 months salary. No deduction
will be made from severance pay if a salary is received from another
position. If notice is given by the CEO, the term of notice is six months.
Severance pay will not be paid in this case.
TERMS OF EMPLOYMENT FOR EXECUTIVES
Employment contracts include regulations on remuneration and terms of
notice.
For business area managers and subsidiary managers variable remuneration
in 2012 has a limit of 100 percent of the fixed annual salary, excluding
benefits. Variable remuneration is based on an earning period of one year.
The result is based on to what extent to which an individual achieves set
targets in advance.
The targets are primarily quantitative and are set by the president after
approval by the chairman of the board.
An employee can normally give notice with a term of six months in the
contract. No severance pay is paid in this case. If notice is given by Cherry,
executives are entitled to a term of notice of six months and severance pay
corresponding to 6 months salary. No deduction will be made from severance
pay if a salary is received from another position.
The executive in Sweden is entitled to pensions in accordance with the
ITP system, or equivalent, and to a certain increase in person premiums.
Salary on which a pension is based does not include variable remuneration
or a company car. The total pension premium including extended pensions
does not exceed 10 price base amounts for anyone. No agreement exists on
the right to an early retirement pension before 65 years of age. Pensions
are defined contributions, with the exception of ITP premiums which are
defined benefit plans. Pensions are non-transferable.
For pensions concerning executives on Malta, Cherry’s subsidiaries only
pay salaries and payroll overheads since these persons handle their own
pensions.
Employment contracts normally include a competition clause that is
valid during the term of employment and for an additional 12 to 24 months.
2012 2011
Gender balance in corporate management Number of men Number of women Number of men Number of women
Board 6 - 6 -
Other executives 2 - 2 -
Total parent company 8 0 8 0
Other executives 4 - 4 -
Total group 12 0 12 0
annual report 2012 |
47

Part 2 notes
Note 8: Remuneration to auditors
Note 9: Depreciation and write-downs
48 | annual report 2012
Group Parent Company
2012 2011 2012 2011
Gaming agreements and concessions -1 372 -1 058 0 -
Development costs -1 652 -1 509 0 -
Trademarks and domain names -402 -422 -47 -68
Inventories and gaming equipment -2 229 -2 121 -230 -222
Total -5 654 -5 110 -276 -290
Note 10: Other operating expenses
Group Parent Company
2012 2011 2012 2011
PricewaterhouseCoopers AB
Audit assignment -517 -536 -183 -168
Auditing in addition to audit assignment -120 - -120 -
Tax advising -55 - -55 -
Other assignments - -57 - -57
Total
Other audit companies
-692 -593 -358 -225
Audit assignment -61 -70 - -
Auditing in addition to audit assignment - - - -
Tax advising - - - -
Other assignments 0 -155 - -
Total -61 -225 0 0
Total -753 -818 -358 -225
of which in discontinued operations -231 -291 -120 -
The audit assignment refers to remuneration for the audit stipulated by law, i.e. such work as is necessary to produce the audit report, as well as audit
advising issued in conjunction with the audit assignment.
Group Parent Company
2012 2011 2012 2011
Capital loss from sale of fixed assets -322 -179 -182 -
Total -322 -179 -182 0

Note 11: Financial items
Group Parent Company
2012 2011 2012 2011
Group contributions - - 11 862 12 432
Profit from disposal of subsidiaries - - -19 982 7 016
Result on liquidation - - - 7 016
Dividends from subsidiaries - - 4 500 32 269
Result from participations in group companies - - -3 620 58 733
Interest income 252 98 210 73
Changes in exchange rates, net - - - 149
Financial income 252 98 210 222
(of which group companies) - - - -
Interest expenses -2 510 -1 067 -2 428 -1 083
Interest expenses, financial leasing - -103 - -
Changes in exchange rates, net -1 900 -6 -1 193 -
Financial expenses -4 410 -1 176 -3 621 -1 083
(of which group companies) - - 0 -1 081
Total net finance -4 158 -1 078 -7 031 57 872
Note 12: Tax
Group Parent Company
Tax expenses in income statements 2012 2011 2012 2011
Allocation to current and deferred tax
Current tax -1 519 -1 564 - -
Deferred tax -151 573 - -
Total -1 670 -991 0 0
Group Parent Company
Difference between real tax expense and tax expense based on applicable tax rate 2012 2011 2012 2011
Reported profit before tax 32 672 39 015 -18 470 38 557
Tax as per applicable tax rate (26.3%) -8 593 -10 261 4 858 -10 140
Tax attributable to previous year - - - -
Difference in tax in foreign operations 7 073 3 614 - -
Tax effect of non-reported deficit deductions -18 -1 031 - -157
Tax effect of utilised loss deductions not reported previously 206 - 157 -
Tax effect of changes in tax rate 23 - - -
Tax effect of non-taxable/non-deductible items -361 6 687 -5 014 10 297
Total tax -1 670 -991 0 0
Specification of deferred tax:
Tax changes for temporary differences -35 -100 - -
Tax on group contributions from discontinued operations - 673 - -
Tax expenses on changes in balance sheet allocations -116 - - -
Total deferred tax -151 573 0 0
As a result of the change in the Swedish corporate tax from 26.3% to 22.0% applicable from 1 January 2013 the reported values for deferred tax concerned
has been recalculated. Deferred tax which was expected to be restored after 1 JanuarY 2013 has been calculated by using the effective tax rate of 22.0%.
For specification of changes in deferred tax receivables, see Note 17.
annual report 2012 |
49

Part 2 notes
50 | annual report 2012
Group Parent Company
Taxes in balance sheets 2012 2011 2012 2011
Deferred tax receivables
- Deferred tax receivables, temporary differences 17 157 - -
Total Long-term receivables 17 157 0 0
Of the reported deferred tax receivables, SEK 17 thousand is expected to be used within one year from the balance sheet date.
Current receivables
- Tax receivables 9 006 10 726 - 15
Total 9 006 10 726 0 15
Deferred tax liabilities
- Deferred tax, temporary differences - -432 - -
- Deferred tax, overdepreciation -116 - - -
Total -116 -432 0 0
Of the reported deferred tax liabilities, SEK 0 thousand is expected to be used within one year from the balance sheet date.
Current liabilities
- Tax liabilities -10 842 -12 205 -298 -
Total -10 842 -12 205 -298 0
Non-reported deferred tax receivables concerning deficit deductions amounted to SEK 1 056 thousand (2 071) . This reduction is attributable to
discontinued operations. No part of the deferred tax receivables concerning deficit deductions is limited in time.
Note 13: Earnings per share
Earnings per share before dilution is calculated by dividing the result
attributable to parent company shareholders by a weighted average
number of outstanding ordinary shares during the period, excluding any
redeemed shares held as shares by the parent company.
To calculate earnings per share after dilution the weighted average
number of outstanding shares is adjusted for the dilution effect of all
potential ordinary shares. The parent company only has one category of
potential ordinary shares with a dilution effect, i.e. share options. For
these a calculation is made for the number of shares that could have been
purchased at fair value (calculated as the average market price for the par-
Group
2012 2011
Net profit for remaining operations attributable to parent company shareholders. 31 020 38 024
Net profit for total operations attributable to parent company shareholders. 30 396 36 030
Total number of outstanding shares 1 January 12 802 642 12 802 642
Issue of shares during the year - -
Total number of outstanding shares 31 December 12 802 642 12 802 642
Average number of shares prior to dilution 12 802 642 12 802 642
Effect of options 403 548 -
Average number of shares after dilution 13 206 190 12 802 642
Earnings per share (SEK)
Earnings per share from remaining operations prior to dilution 2.42 2.97
Earnings per share from remaining operations after dilution 2.35 2.97
Earnings per share from total operations prior to dilution 2.37 2.81
Earnings per share from total operations after dilution 2.30 2.81
ent company shares), for an amount corresponding to the monetary value
of the subscription rights linked to the outstanding share options. The
number of shares calculated is compared with the number of shares that
would have been issued on the assumption that the share options were
utilised. The calculation shows that outstanding options (455 000 options
in the options programme 2011–2014) had a dilution effect for 331 days in
2012. A total of 500 000 options were set out, but the remaining 45 000
options have not been issued and are placed in Cherry Casino Syd AB.

Note 14: Leasing
Leasing and rental costs for equipment that is rented and included in the concept of operational leasing amounted to:
Group Parent Company
2012 2011 2012 2011
Recognised leasing and rent expenses -499 -507 -126 -147
Future minimum charges concerning non-terminable operational leasing and rental agreements will be incurred as below:
Group Parent Company
2012 2012
- in 2013–2016 -499 -155
- in 2014-2017 -259 -117
- after 2017 -155 -13
Total -913 -285
Note 15: Intangible fixed assets
Group Goodwill
Gaming
agreements
& concessions
2012 2011
Development
costs
Trade
marks &
domain
names Total Goodwill
Gaming
agreements
& concessions
Development
costs
Trade
marks &
domain
names Total
Opening acquisition value 346 792 9 345 2 989 1 428 360 554 349 014 12 563 1 823 1 370 364 770
Investments - 5 075 1 379 182 6 636 - 264 1 177 64 1 505
Increase through acquisition - 2 500 - - 2 500 - - - - 0
Discontinued operations - -3 147 - - -3 147 - - - - 0
Other sales & retirements - 0 - - 0 - -3 560 - - -3 560
Exchange rate differences -12 721 -21 -110 -39 -12 890 -2 222 -37 -12 -7 -2 278
Closing accumulated
acquisition value
334 071 13 752 4 258 1 572 353 653 346 792 9 230 2 988 1 427 360 437
Opening depreciation - -4 961 -1 494 -988 -7 443 - -4 047 - -571 -4 618
Depreciation &
write-downs in the year
-73 447 -1 372 -1 652 -402 -76 873 - -1 099 -1 509 -422 -3 030
Discontinued operations - 2 705 - - 2 705 - - - - 0
Depreciation and write-downs for
discontinued operations in the year
- - - - 0 - - - - 0
Other sales & retirements - 0 - - 0 - 216 - - 216
Exchange rate differences - 21 72 29 122 - -31 15 5 -11
Closing accumulated depreciation -73 447 -3 608 -3 074 -1 361 -81 489 0 -4 961 -1 494 -988 -7 443
Recognised value 260 624 10 144 1 184 211 272 164 346 792 4 269 1 494 439 352 994
2012 2011
Parent company Trademarks Total Trademarks Total
Opening acquisition value 378 378 313 313
Acquisitions in the year 139 139 64 64
Closing accumulated acquisition value 517 517 377 377
Opening depreciation -289 -289 -220 -220
Depreciation in the year -47 -47 -68 -68
Closing accumulated depreciation -335 -335 -288 -288
Recognised value 182 182 89 89
annual report 2012 |
51

Part 2 notes
WRITE-DOWN OF GOODWILL
The goodwill reported for the group derives from the acquisition of the
Automaten group in 2010.
The goodwill, which has a reported value of SEK 260 million, belongs
to the cash generating unit Online Gaming. Since goodwill is not writtendown,
a write-down test has been made in accordance with IAS 36 in the
fourth quarter of 2012 by comparing future discounted cash flows with
the reported value. The test showed there was a write-down requirement
of SEK 73 million.
The recovery value is based on cash flow forecasts based on actual
results in operations in 2011 and 2012 and a five year forecast, which is
52 | annual report 2012
based on a business plan and budget for 2013. The growth rate in the first
five years is expected to be in line with the industry.
Cash flows for the years after 2018 have been extrapolated by an annual
growth rate of 2 percent, which corresponds to an assumed average
future rate of inflation and lies at the level of expectations in the industry.
The forecasted cash flows have been discounted with an interest rate
of 13.7 percent before tax.
The discount interest reflects the specific risk applicable for the cash
flow generating unit Online Gaming.
The most important assumptions in the five year forecast and the methods used to estimate the values are as follows:
Important variables Method to estimate values
Sales
Operating margin
A forecast based on current market plans, updated annually on the basis of actual results. The forecast is based on previous
experiences and external sources of information.
The operating margin largely depends on which market investments are implemented. Amounts are determined in annual
budgets for the unit. The forecast is based on previous experiences and external sources of information.
The actual outcome of operations in 2012 for Cherry Online Gaming did
not live up the high expectations.
The following sensitivity analyses of the calculation of the present
value in conjunction with the write-down assessment have been made:
A general reduction of the sales growth rate by 1 percentage unit in the
forecast period, a general reduction of the operating margin by 1 percentage
unit in the forecast period, a general increase in WACC by 1 percentage
Note 16: Tangible fixed assets
unit, and a general reduction of the growth rate after the forecast period
by 0.5 percentage unit. The sensitivity analyses show that none of the
adjustments on their own will generate any essential write-down requirement.
In February 2013 the trademarks and domains related to Sverige-
Automaten, NorgesAutomaten and DanmarksAutomaten were sold to
Betsson AB (plc). For a more detailed description, see Note 33.
Group: Inventories and gaming equipment Parent company: Inventories
2012 2011 2012 2011
Opening acquisition value 90 658 84 090 1 073 694
Investments 6 097 4 909 23 433
Discontinued operations -73 397 - - -
Other disposals and retirements - -1 734 - -54
Reclassifications - 3 367 - -
Exchange rate changes -1 826 142 - -
Closing accumulated acquisition value 21 532 90 774 1 096 1 073
Opening depreciation -62 089 -54 866 -676 -508
Discontinued operations 52 749 - - -
Other disposals and retirements - 1 584 0 54
Annual depreciation -2 229 -2 121 -230 -222
Annual depreciation for discontinued operations -3 628 -6 239 - -
Reclassifications - -337 - -
Exchange rate changes 929 -110 - -
Closing accumulated depreciation -14 268 -62 089 -905 -676
Recognised value 7 263 28 685 190 397

This item includes leasing objects that the group holds in accordance with financial leasing agreements with the following amounts:
Participations in group companies 2012 2011
Acquisition value of activated financial leasing 3 367 3 367
Accumulated depreciation -1 684 -1 010
Future minimum charges concerning financial leasing agreements will have the following results:
- in 2013-2016
- in 2014-2017
- after 2017
Total
Note 17: Financial fixed assets
Group
Parent Company
annual report 2012 |
Group 2012
Participations in group companies 2012 2011
Opening acquisition value 408 447 435 649
Annual acquisitions - -
Disposal of subsidiaries -28 026 -
Liquidation of subsidiaries - -1 000
Revaluation of conditional proceeds -73 446 -26 202
Closing book value 306 975 408 447
Group Parent Company
Deferred tax receivables 2012 2011 2012 2011
Opening value 157 239 - -
Tax receivables attributable to discontinued operations -104 - - -
Changes in tax, deficit deductions - - - -
Tax changes for temporary differences -36 -82 - -
Exchange rate differences - - 0 0
Closing value 17 157 - -
Group Parent Company
Other long-term receivables 2012 2011 2012 2011
Opening value 595 520 - -
Changes in long-term receivables -165 75 - -
Closing value 430 595 0 0
-707
-993
-
-1 700
53

Part 2 notes
Note 18: Participations in group companies
Company CIN Head office Participation % No. of shares 2012 2011
Cherry Casino AB 556225-3806 Stockholm 100% 20 000 8 313 8 313
Cherry Casino Syd AB 556229-6730 Gothenburg 100% 20 000 6 972 6 972
Playcherry PR & Media AB 556420-9632 Stockholm 100% 5 000 1 670 1 670
Cherry Malta Ltd C 47263 Malta 100% 1 200 190 020 263 466
- Inprom Ltd C 43 921 Malta 100% 125 000 - -
- Esprom Ltd C 48657 Malta 100% 1 200 - -
- Playcherry Ltd C 43059 Malta 100% 280 000 - -
- Yggdrasil Holding Ltd C 57560 Malta 95% 100 000 - -
- Yggdrasil Ltd 108 560 Gibraltar 95% 2 000 - -
- Yggdrasil Gaming Ltd C 57683 Malta 95% 40 000 - -
Euroslots Gaming Ltd C 48654 Malta 100% 12 000 100 000 100 000
- EuroSlots Ltd C 48658 Malta 100% 1 200 - -
- Cherry Ltd Gibraltar 100% 2 000 - -
Astral Marine Services Ltd * 3522485 England 100% 200 000 - 14 561
Cherry Maritime Gaming AB * 556207-4335 Solna 100% 10 000 - 13 465
- Cherry Services Ltd * CY 10165761Q Cypern 55% 275 - -
- Briseis Development Corp ** Liberia 55% 500 - -
Total 306 975 408 447
Note 19: Accounts receivable
54 | annual report 2012
2012 2011
Accounts receivable 26 580 23 972
Minus: reserves for uncertain receivables -2 670 -4 398
Accounts receivable – net 23 910 19 574
2012 2011
Accounts receivable in euro 25 770 17 053
Accounts receivable in SEK 810 5 930
Accounts receivable in GBP - 989
Accounts receivable 26 580 23 972
Note 20: Current receivables
* Company sold during 2012 ** Company discontinued during 2012
Accounts receivable in the group have terms of payment of 10–30 days and
therefore the value in the balance sheet corresponds with the real value. The
maximum exposure to credit risks concerning accounts receivable as of the balance
sheet date is the reported net value for the receivables mentioned above.
In general Cherry does not have any guarantees for accounts receivable, but
there are guarantees for some restaurant loans and some accounts receivable.
As of 31 December 2012, SEK 19 676 thousand (8 497) of accounts receivable
were older than 30 days. Of these SEK 3 162 thousand (4 398) have been
reserved as uncertain. The due receivables for which no write-down has been
made refer to several customers where Cherry has a separate agreement concerning
the payment period. In total profit for the year has been charged with
expenses for suspected and confirmed customer losses of SEK 2 670 thousand
(3 616) concerning accounts receivable.
Group Parent Company
2012 2011 2012 2011
Short-term part of restaurant loan 1 708 2 664 - -
Receivable gaming cash, small change cash, money in slot machines 3 277 10 149 - -
Gaming shares 1 045 1 818 - -
VAT 390 948 131 188
Other 1 413 1 481 369 264
Total 7 833 17 060 500 452

RESTAURANT LOANS
Restaurant loans have different terms of payment, depending on the
agreements made with respective owners. Loans seldom have a life term
longer than one year. The part of the restaurant loan expected to be paid
later than one year from the balance sheet date is reported as long-term
receivables.
As of 31 December 2012, restaurant loans amounting to SEK 1 105
thousand (1 210) were due. Of these SEK 1 007 thousand (1 080) have
been reserved as uncertain.
RECEIVABLE GAMING CASH, SMALL CHANGE CASH,
MONEY IN SLOT MACHINES
These receivables have short terms and payment is normally received
within 15 to 30 days. As of 31 December 2012, SEK 174 thousand (301) of
receivables were older than 30 days. Of these SEK 77 thousand (83) have
been reserved as uncertain.
In total profit for the year has been charged with expenses for suspected
and confirmed losses concerning receivables of gaming cash, small change
cash and money in slot machines to an amount of SEK 31 thousand (31).
Note 21: Prepaid expenses and accrued income
Note 22: Equity
GAMING SHARES
Gaming shares refer to receivables at venues where the restaurant looks
after the cash takings, or where Cherry has other receivables from the
restaurant owner. The accounts are settled monthly in arrears, through
so-called “krögarbrev”. Krögarbrev (restaurant invoices) are due for payment
10 to 30 days after they are issued.
As of 31 December 2012, gaming shares amounting to SEK 496 thousand
(553) were due. Of these SEK 465 thousand (498) have been assessed
to be uncertain and have been reserved in their entirety.
In total profit for the year has been charged with expenses for suspected
and confirmed customer gaming share receivables to an amount of SEK
126 thousand (122).
OTHER CURRENT RECEIVABLES
In total, profit for the year has been charged with expenses for suspected
and confirmed customer losses of SEK 441 thousand (428) concerning
other receivables.
Group Parent Company
2012 2011 2012 2011
Rent 626 405 75 110
Insurance 126 413 93 281
Accrued interest income 70 - - -
Other prepaid expenses 2 370 5 896 195 151
Total 3 192 6 714 363 542
Composition of share capital 2012 2011
Parent company No. of shares Share capital No. of shares Share capital
Shares, A series (10 votes) 997 600 549 997 600 549
Shares, B series (1 vote) 11 805 042 6 493 11 805 042 6 493
Total shares 12 802 642 7 041 12 802 642 7 041
The nominal value of the share was SEK 0.55 as of 31-12-2012. Both A- and
B-shares have equal rights to assets and profits in the company.
An issue of 500 000 subscription options was decided at an extraordinary
general meeting on 19-10-2011. The company’s share capital can increase
by a total of SEK 275 thousand.
annual report 2012 |
55

Part 2 notes
Note 23: Other provisions
56 | annual report 2012
Parent Company
2012 2011
Other provisions
Conditional supplementary proceeds - -71 483
Total 0 -71 483
See also Note 30.
Note 24: Long-term liabilities
Group Parent Company
2012 2011 2012 2011
Long-term interest bearing liabilities
Liabilities to credit institutions - -6 667 - -6 667
Liabilities related to financial leasing -1 083 -1 710 - -
Total -1 083 -8 377 0 -6 667
Granted non-utilised credit amounted to 15 000 15 000 15 000 15 000
Long-term non-interest bearing liabilities
Guarantee liabilities - -1 342 - -
Condition proceeds - -71 483 - -
Total 0 -72 825 0 0
No part of long-term liabilities falls due for payment later than five years after the balance sheet date. Concerning conditional proceeds, see Note 30.
Note 25: Accounts payable
Accounts payable in the group have standard terms of payment and therefore the value in the balance sheet corresponds with the real value.
Note 26: Current liabilities
Group Parent Company
2012 2011 2012 2011
Current interest bearing liabilities
Liabilities to credit institutions - -6 667 - -6 667
Liabilities related to financial leasing -693 -692 - -
Total
Other current liabilities
-693 -7 359 - -6 667
Personnel tax -2 637 -2 459 -146 -157
Gaming taxes -1 453 -1 564 - -
Gaming shares to venues -3 910 -3 817 - -
VAT -3 167 -3 069 - -
Other -575 -4 467 -59 -38
Total -11 742 -15 376 -205 -195
Note 27: Accrued expenses and prepaid income
Group Parent Company
2012 2011 2012 2011
Accrued salaries -5 613 -6 494 -2 076 -3 441
Holiday pay -4 202 -4 276 -98 -68
Payroll overheads -3 062 -2 717 -326 -147
Other -10 327 -3 348 -1 162 -968
Total -23 204 -16 835 -3 662 -4 624

Note 28: Pledged assets relating to liabilities in company
Note 29: Financial assets and liabilities
Group Parent Company
2012 2011 2012 2011
Shares in subsidiaries 6 529 10 206 8 313 21 778
Total 6 529 10 206 8 313 21 778
Loans receivable
and accounts
receivable
Financial assets and
liabilities reported at fair
value via the income statement
Other financial
liabilities
Total
reported value
Non financial
assets
and liabilities
Non financial assets and liabilities include taxes and personnel related balance sheet items regulated by a standard other than IFRS 7.
annual report 2012 |
Total
balance sheet
Group 2012
Other long-term receivables 430 - - 430 - 430
Accounts receivable 26 580 - - 26 580 - 26 580
Other receivables 7 443 - - 7 443 12 588 20 031
Liquid assets 59 057 - - 59 057 - 59 057
Total 93 510 0 0 93 510 12 588 106 098
Long-term interest bearing liabilities - - 1 083 1 083 - 1 083
Current interest bearing liabilities - - 693 693 - 693
Accounts payable - - 6 235 6 235 - 6 235
Other liabilities - - 4 485 4 485 41 303 45 788
Total 0 0 12 496 12 496 41 303 53 799
Group 2011
Other long-term receivables 595 - - 595 - 595
Accounts receivable 19 574 - - 19 574 - 19 574
Other receivables 16 112 - - 16 112 18 388 34 500
Liquid assets 30 457 - - 30 457 - 30 457
Total 66 738 0 0 66 738 18 388 85 126
Long-term interest bearing liabilities - - 8 377 8 377 - 8 377
Other long-term liabilities - 72 825 - 72 825 - 72 825
Current interest bearing liabilities - - 7 359 7 359 - 7 359
Accounts payable - - 9 062 9 062 - 9 062
Other liabilities - - 8 284 8 284 36 132 44 416
Total 0 72 825 33 082 105 907 36 132 142 039
Parent company 2012
Other receivables 369 - - 369 494 863
Liquid assets 41 252 - - 41 252 - 41 252
Total 41 621 0 0 41 621 494 42 115
Accounts payable - - 320 320 - 320
Other liabilities - - 59 59 3 808 3 867
Total 0 0 379 379 3 808 4 187
Parent company 2011
Accounts receivable - - - 0 - 0
Other receivables 264 - - 264 745 1 009
Liquid assets 17 768 - - 17 768 - 17 768
Total 18 032 0 0 18 032 745 18 777
Long-term interest bearing liabilities - - 6 667 6 667 - 6 667
Other long-term liabilities - 72 825 - 72 825 - 72 825
Current interest bearing liabilities - - 6 667 6 667 - 6 667
Accounts payable - - 560 560 - 560
Other liabilities - - 38 38 4 781 4 819
Total 0 72 825 13 932 86 757 4 781 91 538
57

Part 2 notes
Note 30: Acquisition of companies
ADJUSTMENTS IN 2012 OF PREVIOUS ACQUISITIONS
AUTOMATENGRUPPEN
The terms and conditions required for payment of the conditional proceeds
have not been met. The liability for these proceeds has therefore
been valued to zero. Since the acquisition was implemented after IFRS 3
began to be applied, the revaluation of SEK 73 446 thousand (23 828)
has been reported in the income statement (included in Other operating
income) in the consolidated financial statements.
Note 32: Discontinued operations
MARITIME OPERATIONS
Cherry completed on 8 November 2012 the sale of all shares in Cherry
Maritime Gaming AB, Astral Maritime Services Ltd and Cherry Services
Ltd to Bell Casino AB. The discontinued operations have previously comprised
the Maritime segment, which has now been completely discon-
58 | annual report 2012
The goodwill attributable to the Automaten group has undergone an
impairment test, whereby a write-down requirement of SEK 73 447
thousand was identified. See also Note 15.
During the year no payments concerning conditional proceeds have
been made for the Automaten group.
Note 31: Transactions with holdings without controlling influence
TRANSACTIONS 2012
On 23 February 2012 Cherry reached an agreement on the acquisition of
additional shares in the partly-owned subsidiary Cherry Services Ltd and
in Briseis Development Corporation. Cherry previously owned 55 percent
of the shares and votes in the companies and the agreement concerns the
remaining 45 percent. The proceeds amounted to SEK 1 382 thousand
and were paid in cash on entry.
Since Cherry already had a controlling influence in the company, the acquisition
was reported as equity transactions in accordance with IAS 27.
Cherry Services Ltd and Briseis Development Corporation were included
in the Maritime business operations that were discontinued during the
year.
tinued as a result of the sale. Cherry received total proceeds of SEK 36.3
million for shares, dividends from the sold companies and repayment of
group loans that had been issued to the discontinued companies.
Analysis of results from discontinued operations 2012 2011
Earnings 67 733 99 108
Operating expenses -64 874 -96 538
Depreciation -3 637 -6 280
Result from discontinued operations before tax -778 -3 710
Income tax 154 -477
Result from discontinued operations after tax -624 -4 187
Capital loss - -
Profit for the year from discontinued operations -624 -4 187
Cash flow attributable to discontinued operations
Cash flow from operating activities -2 914 3 623
Cash flow from investment operations 24 386 -2 206
Cash flow from financing operations -1 774 324
Total cash flow 19 698 1 741

Note 33: Events after the end of the reporting period
In February 2013 the trademarks and domains related to SverigeAutomaten,
NorgesAutomaten and DanmarksAutomaten were sold to Betsson AB
(plc). The proceeds amounted to SEK 286.0 million, of which SEK 225
million has been regulated through the delivery of a corresponding new
issue of 1 063 895 Betsson B-shares and transfer of CherryCasino.com.
The remaining proceeds, SEK 60 million, will be regulated with liquid
assets after twelve months. In conjunction with the sale, Cherry acquires
the gaming site CherryCasino.com for SEK 1.0 million.
Cherry sold its shareholding in Betsson in February, which brought in
SEK 228.7 million before deductions for transaction costs.
Slot machine sites generated earnings in 2012 of SEK 168.2 million.
CherryCasino.com generated earnings in 2012 of SEK 1.5 million.
Goodwill arising in conjunction with the acquisition of the Automaten
group and which as of 31 December 2012 amounted to SEK 260.6 million,
was written-down as a result of the sale to zero in the first quarter of 2013.
annual report 2012 |
59

Part 2 signAtures / Auditor’s report
Signatures
The annual report and consolidated financial statements for Cherry AB
(plc) in the year 2012 have been approved for publication following a
decision taken by the board on 12 April 2013.
It is proposed that the annual report and consolidated financial statements
be adopted at the annual general meeting on 7 May 2013.
The board of directors and CEO hereby declare that the consolidated
accounts have been prepared in accordance with international financial
reporting standards IFRS, as adopted by the EU, and give a true and
fair view of the group’s financial position and results of operations. The
Stockholm, 12 april 2013.
Rolf Åkerlind
Chairman
Anders Holmgren
Board member
Emil Sunvisson
CEO
Our audit report was submitted on 12 April 2013.
PricewaterhouseCoopers AB
Niklas Renström
Authorised public accountant
60 | annual report 2012
Kjell Berggren
Board member
Martin Wattin
Board member
annual report has been prepared in accordance with generally accepted
accounting principles and gives a true and fair view of the financial position
and results of operations for the parent company.
The administration report for the group and parent company gives
a true and fair view of the development of group and parent company
operations, financial position and results of operations, and describes
essential risks and uncertainty factors that face the parent company and
the companies included in the group.
Morten Klein
Board member
Jörgen Olsson
Employee representative

Auditor’s report
TO THE ANNUAL MEETING OF THE SHAREHOLDERS OF CHERRY AB (PLC)
CORPORATE IDENTITY NUMBER 556210-9909
REPORT ON THE ANNUAL ACCOUNTS
AND CONSOLIDATED ACCOUNTS
We have audited the annual accounts and consolidated accounts of
Cherry AB for the year 2012. The annual accounts and consolidated
accounts of the company are included in the printed version of this
document on pages 22–60.
RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE CEO
AND PRESIDENT (“PRESIDENT”) FOR THE ANNUAL ACCOUNTS
AND CONSOLIDATED ACCOUNTS
The Board of Directors and the President are responsible for the preparation
and fair presentation of these annual accounts and consolidated
accounts in accordance with International Financial Reporting
Standards, as adopted by the EU, and the Annual Accounts Act, and for
such internal control as the Board of Directors and the President determine
is necessary to enable the preparation of annual accounts and consolidated
accounts that are free from material misstatement, whether due
to fraud or error.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion on these annual accounts and
consolidated accounts based on our audit. We conducted our audit in
accordance with International Standards on Auditing and generally
accepted auditing standards in Sweden. Those standards require that
we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the annual accounts and
consolidated accounts are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the annual accounts and consolidated
accounts. The procedures selected depend on the auditor’s judgement,
including the assessment of the risks of material misstatement of the annual
accounts and consolidated accounts, whether due to fraud or error. In
making those risk assessments, the auditor considers internal control
relevant to the company’s preparation and fair presentation of the annual
accounts and consolidated accounts in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the company’s internal control.
An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by
the Board of Directors and the President, as well as evaluating the overall
presentation of the annual accounts and consolidated accounts.
We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our audit opinion.
OPINIONS
In our opinion, the annual accounts have been prepared in accordance
with the Annual Accounts Act and present fairly, in all material respects,
the financial position of the parent company as of 31 December 2012 and
of its financial performance and its cash flows for the year then ended
in accordance with the Annual Accounts Act. The consolidated accounts
have been prepared in accordance with the Annual Accounts Act and
present fairly, in all material respects, the financial position of the group
as of 31 December 2012 and of their financial performance and cash
flows for the year then ended in accordance with International Financial
Reporting Standards, as adopted by the EU, and the Annual Accounts Act.
The statutory administration report is consistent with the other parts of
the annual accounts and consolidated accounts.
We therefore recommend that the annual meeting of shareholders
adopt the income statement and balance sheet for the parent company
and the group.
REPORT ON OTHER LEGAL
AND REGULATORY REQUIREMENTS
In addition to our audit of the annual accounts and consolidated accounts,
we have also audited the proposed appropriations of the company’s profit
or loss and the administration of the Board of Directors and the President
of Cherry AB for the year 2012.
RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE PRESIDENT
The Board of Directors is responsible for the proposal for appropriations
of the company’s profit or loss, and the Board of Directors and the President
are responsible for administration under the Companies Act.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion with reasonable assurance on
the proposed appropriations of the company’s profit or loss and on the
administration based on our audit. We conducted the audit in accordance
with generally accepted auditing standards in Sweden.
As a basis for our opinion on the Board of Directors’ proposed appropriations
of the company’s profit or loss, we examined the Board of Directors’
reasoned statement and a selection of supporting evidence in order to be
able to assess whether the proposal is in accordance with the Companies Act.
As a basis for our opinion concerning discharge from liability, in addition
to our audit of the annual accounts and consolidated accounts, we examined
significant decisions, actions taken and circumstances of the company
in order to determine whether any member of the Board of Directors
or the President is liable to the company. We also examined whether any
member of the Board of Directors or the President has, in any other way,
acted in contravention of the Companies Act, the Annual Accounts Act or
the Articles of Association.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinions.
OPINIONS
We recommend to the annual meeting of shareholders that the profit be
appropriated in accordance with the proposal in the statutory administration
report and that the members of the Board of Directors and the
President be discharged from liability for the financial year.
Stockholm April 12, 2013
PricewaterhouseCoopers AB
Niklas Renström
Authorized Public Accountant
annual report 2012 |
61

Part 2 definitions
Definitions
EARNINGS Gaming income is reported net after deductions for player winnings, bonuses and
loyalty programmes. Cherry reports its share of income from lotteries as income.
RUNNING COSTS IN GAMING OPERATIONS Running costs in gaming operations refer to direct costs such as gaming shares to
venues, gaming taxes and licences, purchasing of materials, and purchased services
directly related to gaming operations.
AVERAGE TOTAL CAPITAL Balance sheet total at the start of the fiscal year plus balance sheet total at the end of
the fiscal year divided by two.
AVERAGE EQUITY Equity at the start of the fiscal year plus equity at the end of the fiscal year, divided by two.
RETURN OF TOTAL CAPITAL Result after financial items plus financial expenses in relation to average total capital.
RETURN ON CAPITAL EMPLOYED Result after financial items plus financial expenses in relation to average capital employed.
RETURN ON EQUITY Profit/loss after tax in relation to average equity.
PROFIT MARGIN Result after financial items in relation of turnover for the period.
OPERATING MARGIN Operating profit in relation to turnover for the period.
OPERATING PROFIT BEFORE DEPRECIATION (EBITDA) Result before tax, financial items, depreciation and write-downs.
OPERATING PROFIT (EBIT) Result before tax and financial items.
EQUITY RATIO Equity at the end of the period in percent of balance sheet total at the end of the period.
ACID-TEST RATIO Current assets excluding inventories in relation to current liabilities, including proposed
but not adopted share dividends.
NUMBER OF EMPLOYEES The number of persons employed when salaries for the last month were paid out.
AVERAGE NUMBER OF EMPOYEES The number of employees converted to full-time employment (annual).
NUMBER OF SHARES The number of shares at the end of respective period.
AVERAGE NUMBER OF OUTSTANDING SHARES The weighted average number of outstanding shares during the period.
EARNINGS PER SHARE Profit after tax in relation to average number of outstanding shares during the period.
EARNINGS PER SHARE AFTER DILUTION Net income divided by the weighted average of the number of outstanding shares during
the year adjusted for the additional number of shares during conversion, including
options with dilution effect. Calculated according to IAS 33 Earnings per share.
CASH FLOW PER SHARE The cash flow in relation to the average number of outstanding shares during the period.
EQUITY PER SHARE Equity in relation to the number of shares at the end of the period.
DIVIDEND PER SHARE Completed/proposed dividend.
SHARE PRICE The last share price paid for the last share transaction of the period.
NUMBER OF (REGISTERED) SHAREHOLDERS The number of Euroclear and nominee registered shareholders according to the
Euroclear list of shareholders/share register.
62 | annual report 2012

www.cherry.se
info@cherry.se
Stockholm (HQ)
Cherry
Headquarters
Cherry AB (Publ)
Blekholmstorget 30
111 64 Stockholm
Tel: +468-514 969 40
Fax: +468-514 969 59
info@cherry.se
CEO Emil Sunvisson
CFO/IR Fredrik Burvall
Malta, Sliema
Online Gaming: EuroLotto.com, EuroSlots.com, CherryCasino.com,
SpilleAutomater.com and CherryAffiliates.com
Companies: EuroSlots Ltd, EuroSlots Gaming Ltd,
Cherry Malta Ltd, PlayCherry Ltd, Inprom Ltd,
Esprom Ltd.
71 Triq It-Torri, Level 3 & 4
Sliema, SLM1609, Malta
Tel: +356 -2276 6000
Fax: +356 - 2134 0665
CEO Marius Andersen
Malta, Sliema
Online Gaming: Yggdrasil Gaming
Companies: Yggdrasil Gaming Ltd, Yggdrasil Holding Ltd
71 Triq It-Torri, Level 3
Sliema, SLM1609, Malta
Tel: +356 9962 5104
CEO Fredrik Elmqvist
www.yggdrasilgaming.com
Cherry Casino
Umeå
Restaurant Casino Northern Sweden
(Söderhamn in the South to Riksgränsen in the North)
Cherry Casino AB
Kungsgatan 42
90 325 Umeå
Tel: +4690-12 57 30
Fax: +4690-13 37 13
Business area manager Per-Anders Persson, +46709-27 96 25
Stockholm
Restaurant Casino Middle Sweden
(Stockholm, Mälardalen, Östergötland)
Cherry Casino AB
Blekholmstorget 30
111 64 Stockholm
Tel: +468-514 969 40
Fax: +468-514 969 59
Business area manager Per-Anders Persson, +46709-27 96 25
Gothenburg
Restaurangcasino Southern Sweden
(Värmland, Skaraborg, Jönköping, Kronoborg
counties and south)
Cherry Casino AB
Fürstenbergsgatan 4
416 64 Göteborg
Tel: +4631-80 15 55
Fax: +4631-80 29 99
Business area manager Ulf Bergström, +46709-27 96 50