Garo

Quarterly Report • Aug 16, 2024

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THE GARO GROUP1	Apr–Jun 2024	Apr–Jun 2023	+/- %	Jan–Jun 2024	Jan–Jun 2023	R12	Jan–Dec 2023

GARO AB (publ) Corp. Reg. No. 556071–7772 is a company that develops, manufactures and markets innovative products and systems for the electrical installations market under its own brand. GARO's customer offering is to provide complete solutions in the product areas of Electrical distribution products, E-mobility, Project business & Temporary Power with a focus on electrical safety, user-friendliness and sustainability. GARO was founded in 1939, has its head office in Gnosjö and is today an international company with operations in seven countries. The company's production units in Sweden are located in Gnosjö and Hillerstorp in Sweden and in Szczecin in Poland. GARO is listed on Nasdaq Stockholm under the ticker name GARO. For more information, see www.garo.se

CEO Patrik Andersson's comments on the quarter GARO Electrification reports a stable quarter while GARO E-mobility continues to face challenging market conditions

Net sales for the second quarter amounted to MSEK 306 (386), down 21% compared with the year-earlier quarter. The market, which slowed for both business areas at the end of 2023, remained cautious in the first half of 2024. The lower quarterly sales were mainly due to a cautious market in E-mobility, with low sales in Sweden and through our major international contracts. However, the Group's sales outside the Nordic reaion remained strong in the second quarter, confirming the results of our continued investments in Europe.

In GARO Electrification, sales gradually improved during the quarter compared with the year-earlier quarter, with a stable market in Sweden and a very strong market in Ireland.

EBIT amounted to MSEK -4.3 (18.2), which was essentially due to the low sales volume during the quarter compared with the same quarter of 2023. EBIT amounted to MSEK - 10.9 (45.9) for the January to June 2024 period, with GARO posting strong sales in GARO E-mobility in the first half of 2023

Garo e-mobility

Sales in GARO E-mobility amounted to MSEK 84, down 45% compared with the year-earlier quarter. The prevailing market situation with macroeconomic uncertainty is continuing to affect purchasing patterns and investment decisions, primarily in the Swedish market. Moreover, some of our major contract customers still have our products in inventory due to the current market climate. Our markets outside Sweden appear more positive, and GARO E-mobility is continuing its marketing activities in Germany and Poland. We are continuing the establishment of our sales company in Spain, and we expect to be able to carry out the first deliveries to customers in the second half of the year.

The recovery of the market in E-mobility is proceeding slower than expected, particularly in Sweden. We believe that the market will aradually improve and that the outlook for 2025 is more positive. Our long-term vision for the market remains unchanged: we anticipate a major transition to electric vehicles, increasing the need for destination charging. GARO possesses both the capacity and the product portfolio to provide the market with the right products and services.

There is a healthy number of inquiries for projects for tenant-owner associations, parking places and industry. GARO Entity, one of the market's most modern wall boxes, and popular for many reasons, is set to begin to report sales growth as soon as the market situation improves. We have completed our action program, which primarily involved adapting the production capacity to current volumes.

As a result of the current market situation, we continue to adapt costs and other parts of the organization to demand in the various geographical markets. Within the business area, we are also placing key focus on reducing our inventory levels.

GARO ELECTRIFICATION

Sales in GARO Electrification amounted to MSEK 222, a year-on-year decline of MSEK 12. A continued weak economic climate impacted by macroeconomic factors has led to a low production rate in the market for the construction of single-family homes and apartments in Sweden and the rest of the Nordic region. Demand is relatively healthy for commercial properties and industry in the public sector. This need is driven by new construction, renovation and energy enhancements, which are in turn creating a need for both standard and customized products in GARO Electrification. The weaker construction market in Sweden is expected to continue for the entirety of 2024, with housing construction expected to recover in 2025. The planned and already initiated interest-rate cuts are expected to have a positive impact on housing construction and investment willingness in Sweden.

The action program at GARO Electrification completed in autumn 2023 had its desired effect and the business area was able to present an EBIT margin in line with the financial targets, albeit from low volumes.

SYNERGY EFFECTS

The three product areas included in GARO Electrification combined with GARO E-mobility create major synergy effects and provide a stable foundation for GARO's operations. which is particularly important during times of sluggish demand in some product areas. Small, large and complex projects all require products and services from several of our product areas. We believe that part of our success lies in being active in several markets combined with a broad product offering, which is particularly important when faced with economic fluctuations.

The expansion of charging infrastructure is driving demand for products in both Electrical distribution products and Project business, creating a unique ability for GARO to offer attractive complete solutions to customers. This is a major competitive advantage in relation to other comparable market players.

market conditions

We expect lower arowth in the market for E-mobility in the short term. primarily for macroeconomic reasons. In the long term, we anticipate a continued strong trend with further expansion of charging infrastructure and the market for charging infrastructure growing structurally in line with the number of plug-in vehicles.

The construction of new housing in the Nordic region has declined considerably and new production of single-family homes and apartments is expected to be weak throughout 2024. On the other hand, demand for other commercial and public construction, combined with renovation requirements and energy efficiency, remains favorable.

All in all, we have a positive view of long-term market conditions, mainly driven by growth in charging infrastructure and its requirements for power supply as well as by the recovery of housing construction.

Patrik Andersson President and CEO

Earnings

NET SALES

Net sales for the second quarter amounted to MSEK 306.3 (386.0), down 21% or MSEK 80 compared with the same quarter in 2023. MSEK 68 of the decline was attributable to the Swedish market. Net sales for the first half of 2024 amounted to MSEK 598.8 (756.3), down 2 1% compared with the year-earlier period.

EBIT

EBIT was MSEK -4.3 (18.2) for the quarter, providing an EBIT margin of -1.4% (4.7). The negative result was primarily attributable to weak sales in GARO E-mobility. Overall, the gross margin remained at the same level as the preceding quarter, with the improved margin in GARO Electrification offset by a lower gross margin in GARO E-mobility, which was the result of a changed product mix and production redundancies.

Negative currency effects in EBIT for the quarter amounted to MSEK 1.0, compared with the corresponding quarter of 2023 when EBIT was charged with MSEK 8.3 for these effects.

EBIT for the January to June period amounted to MSEK -10.9 (45.9) providing an EBIT margin of - 1.8% (6.1). Positive currency effects in EBIT for the first half of 2024 amounted to MSEK 0.1 compared with a negative effect of MSEK 14.2 in the preceding year.

A project to update GARO's business system has been ongoing since autumn 2023, which will enable improved processes and collaboration between the Group's different units. Parts of the costs for the project were capitalized during the quarter, while costs that could not be capitalized were recognized in full to the business area GARO Electrification.

FINANCIAL ITEMS

The Group's net financial items amounted to MSEK -5.4 (7.2) for the quarter and included currency effects from loans and hedging. Net interest income for the quarter amounted to MSEK -3.1 (-2.3).

TAX

Net income amounted to MSEK -8.9 (20.0) for the quarter, and loss per share to MSEK -0.18 (earnings: 0.40). Tax amounted to MSEK +0.9 (-5.4).

Net income for the January to June period amounted to MSEK -16.7 (40.6) and earnings per share amounted to MSEK -0.33 (0.81). Tax for the January to June period amounted to MSEK -0.4 (-12.1).

CASH FLOW AND INVESTMENTS

Cash flow from operating activities before changes in working capital amounted to MSEK -1.7 (+26.0), while cash flow from operating activities after changes in working capital amounted to MSEK -9.3 (-3.5). Capital tied-up in inventory increased by MSEK 12 net. GARO has also paid a deposit to a supplier for materials ordered but not yet called off. The deposit amounted to approximately MSEK 45 at the end of the period having increased MSEK 5 during the quarter.

Investments for the quarter amounted to MSEK 6.3 (26.1), of which MSEK 3.3 was attributable to product development (8.3). Investments for the January to June 2024 period amounted to MSEK 10.6 (76.2). In the first half of 2023, MSEK 53.4 pertained to investments in the new production facility in Poland.

During the quarter, right-of-use assets (leases and rental contracts) declined net by MSEK 2.8 (+0.5).

EBIT. GROUP

LIQUIDITY AND FINANCIAL POSITION

The Group's net debt at the end of the period amounted to MSEK 293.2 (308.6). The Group's net debt excluding lease liabilities, which is to say effects of IFRS 16, amounted to MSEK 224.9 (236.1). Available liquidity in the Group, including unutilized overdraft facilities, amounted to MSEK 64.8 (79.8) and the equity ratio was 49.6% (49.4).

BUSINESS AREAS

GARO divides its operations into two business areas: GARO E-mobility and GARO Electrification.

THE GARO SHARE

At the end of the period, the number of shares amounted to 50,000,000 (50,000,000). The average number of shares amounted to 50,000,000 (50,000,000) for the first quarter of 2024. On June 28, 2024, the share price closed at SEK 26.75 (62.85).

EVENTS AFTER THE END OF THE QUARTER

GARO has started the recruitment of a new CEO. Patrik Andersson will remain in his role as CEO until a new CEO takes office, according to a separate press release.

In addition to this and until the publication of this report, no significant events or conditions have occurred, favorable or unfavorable, that would require further disclosures.

		Apr-Jun	Apr-Jun	Jan-Jun	Jan-Jun	R12	Jan-Dec
GARO E-MOBILITY KEY FIGURES		2024	2023	2024	2023		2023
Net sales	MSEK	84.4	152.1	168.8	274.3	356.5	462.0
Growth	%	-45	47	-38	10	-20	10
EBIT	MSEK	-24.7	4.5	-48.3	11.2	-96.7	-37.2
EBIT margin	%	-29.8	3.0	-28.9	4.1	-27.2	-8.1
Investments	MSEK	3.4	24.6	6.2	70.8	32.3	96.9
Depreciation	MSEK	8.1	6.3	15.7	9.1	28.9	22.3
Number of employees		166	219	166	219	205	197

For definitions of key figures, see pages 18-20

GARO E-mobility business area

NET SALES AND EARNINGS

Net sales in the GARO E-mobility business area amounted to MSEK 84.4. compared with MSEK 152.1 for the same quarter of 2023. which resulted in negative growth of 45% or MSEK 68. Major deliveries of public chargers took place in the second quarter of 2023, which created challenging comparative figures for the business area.

EBIT was MSEK -24.7 (4.5) for the quarter, providing an EBIT margin of -29.8% (3.0). Low sales, a weaker gross margin with production redundancies, and an organization that is built for growth are the main reasons for the negative earnings.

As a result of the current market situation, GARO continues to adapt costs and other parts of the organization to demand in the various geographical markets. Within the business area, we are also placing key focus on reducing our inventory levels.

OPERATIONS

During the quarter, sales declined for the business area, mainly due to the prevailing market situation. GARO Entity Compact, the market's only wall box for charging at home that is third-party certified according to current charging standards, is facing a market that is under severe price pressure. GARO's uncompromising focus on safety remains firm.

Demand for public charging points is the main driver of sales in the business area. During the quarter, sales in Sweden and the Nordic region were 66% and 48% lower, respectively, compared with the same quarter of 2023. GARO is primarily affected by the market trend in Nordic markets, where the company holds considerable market share. In parallel, growth of 3% was noted for other markets in Europe.

During the quarter, the French market showed considerable interest in GARO's 43 kW charger for heavy vehicles.

Product development for new variants of the LS4 public charging stations is ongoing, as well as separate payment stations to ensure compliance with the new EU Alternative Fuels Infrastructure Regulation (AFIR'). GARO welcomes this initiative as it creates new sales opportunities. The Group is at the forefront of meeting tougher requirements for payment solutions and the ability to communicate between chargers and cars.

The newly established sales company in Germany recorded a healthy first half of the year. The company gained a number of new customers for deliveries both of the Eichrecht-compliant LS4 and Twin+. The company also commenced sales of charging stations for heavy traffic during the quarter. GARO will expand its product portfolio to include Eichrechtcompliant GARO Entity chargers in late autumn 2024 and will certify its factory in Poland for production in accordance with the Eichrecht standard.

GARO also continued the establishment of a sales company in Spain during the quarter. The Spanish sales company is expected to complete its first deliveries to customers in the second half of 2024.

The regulatory amendments enacted in the UK regarding digital security impact two of GARO's products. Until a solution is implemented, GARO will not sell these products for semi-public environments.

THE MARKET

The market for home chargers is subdued and weaker than expected, due to the prevailing market situation with macroeconomic uncertainty, which is affecting purchasing patterns and investment decisions. Increased activity was noted during the quarter regarding inquiries for the expansion of charging stations for major projects at, for example, commercial properties, tenant-owner associations and public places.

¹ Alternative Fuels Infrastructure Regulation.

EBIT, GARO E -MOBIILITY

GARO Electrification business area

GARO ELECTRIFICATION KEY FIGURES		Apr-Jun 2024	Apr-Jun 2023	Jan-Jun 2024	Jan-Jun 2023	R12	Jan-Dec 2023
Net sales	MSEK	221.9	233.9	430.0	481.9	855.8	907.9
Growth	%	-5	-5	-11	O	-12	-6
EBIT	MSEK	20.4	13.7	37.3	34.8	90.8	88.3
EBIT margin	%	9.2	5.8	8.7	7.2	10.6	9.7
nvestments	MSEK	2.9	। .5	4.3	5.4	10.2	11.3
Depreciation	MSEK	6.5	6.7	13.1	13.3	26.0	26.2
Number of employees		268	325	268	325	299	281
Share of sales, Electrical distribution products	%	63	61	63	60	64	62
Share of sales, Project business	%	32	રૂ રે	32	રૂ રે	28	33
Share of sales, Temporary Power	96	5	4	5	5	8	ર

For definitions of key figures, see pages 18-20

NET SALES AND EARNINGS

Net sales in the business area amounted to MSEK 221.9, compared with MSEK 233.9 for the year-earlier quarter, which was a decline of 5%.

EBIT for the quarter amounted to MSEK 20.4 (13.7), providing an EBIT margin of 9.2% (5.8). The completed efficiency program had its desired effect, which can be noted in the improved EBIT. In Ireland, which is an important market for GARO, both the market and GARO performed strongly in Q2. This trend was partly attributable to a broadened product range that is able to address a price-sensitive market but also create the prerequisites for an improved margin.

OPERATIONS

Year-on-year, sales for the product area Electrical distribution products declined MSEK 2 and sales for the Project business product area declined MSEK 11. This was due to market conditions with reduced demand for new construction of single-family homes and apartments, primarily in the Nordic reaion. During the quarter, GARO won two major orders for engine heaters with expected delivery in Q3.

For the Temporary Power product area, growth of 12% compared with the year-earlier quarter was noted, albeit from low volumes. The increased demand in Temporary Power is an indication that the market in GARO Electrification may now have bottomed out and market conditions are expected to recover moving forward.

During periods of sluggish sales in certain areas, the synergy effects between both business areas and product areas become particularly important. GARO's breadth of products and solutions are beneficial for customers and end users as the company is able to offer a complete solution.

THE MARKET

The market for the new construction of single-family homes and apartments in Sweden is assessed to have bottomed out. Positive signs such as lower inflation and falling interest rates are expected to lead to a rise in housing construction in 2025. This will result in a gradual increase in demand for GARO Electrification's products in this area.

New construction in the public sector, commercial properties, industry and infrastructure remain healthy. The market connected to the electrification of society and the green transition is assessed to be stable. However, these volumes will not be able to fully compensate for the lower volume of new construction in the short term.

NET SALES, GARO ELECTRIFICATION

EBIT, GARO ELECTRIFICATION

Sustainability

SUSTAINABILITY WORK

GARO's sustainability work is based on three cornerstones that are all part of the strategic framework: Climate, Circular economy and Ethical and responsible business. The strategy is the foundation that allows GARO to respond to regulatory requirements, meet growing market expectations and pursue growth and return for investors, while also focusing on strengthening GARO's social capital by attracting, encouraging and retaining employees. GARO's operations are to be conducted in a sustainable manner in which all employees are to be offered safe and comfortable workplaces. The products and services that GARO provides create the preconditions for and enable the growth of a sustainable society.

Sustainable production processes are a prerequisite for maintaining a position as a competitive supplier in the market. Production processes provide the basis for efficient resource use, reduced environmental impact and respond to market demand for sustainable alternatives.

Sustainability is integrated and embedded in the GARO Group's strategy and decision-making processes. The sustainability governance structure ensures that regular follow-ups of compliance with the sustainability goals are carried out and that progress and results are actively reported to meet the growing needs for materials and energy with a focus on ecological, social, regulatory and compliance requirements.

FOCUS AREAS

GARO's overall climate target is to become climate neutral by 2040 and develop into a circular Group. GARO works toward the UN Sustainable Development Goals (SDGs). From the 17 SDGs, the Group has selected six that we believe we can create the greatest value and make the most difference.

• . 7 - Affordable and clean energy
• 8 Decent work and economic growth
• 11 Sustainable cities and communities
• 12 Responsible consumption and production
• 13 Climate action
• 16 Peace, justice and strong institutions

As different areas of materiality have varying degrees of impact, which may also change over time, GARO adapts measures, action plans and resources on a step-by-step basis. Reporting and monitoring of KPIs involves broad collaboration and continuous dialog to ensure responsible and effective measurement of progress towards the SDGs.

For more information about GARO's goals for a more sustainable future, refer to GARO's 2023 Annual Report, pages 28-41.

GARO's financial targets

PARENT COMPANY

The Parent Company's operations comprise salestical distribution product development, Group Management, Group-wide functions and the Group's finance function.

Net sales for the Parent Company in the second quarter amounted to MSEK 12.8 (15.5) comprised internal sales. EBT for the quarter amounted to MSEK 9.2 (5.0). Net sales for the January to June period anounted to MSEK 156.4 (189.5) and EBT amounted to MSEK 17.1 (14.3).

ASSURANCE BY THE BOARD AND CEO

The CEO and Board assure that this interim report provides a fair revew of the Group's operations, financial position and earnings, and describes significant risks and uncertainties faced by the Parent Companies included in the Group.

Gnosjö, August 16, 2024

GARO AB (publ), (Corp. ID. No. 55605 1-7772)

Rickard Blomqvist Chairman

Johan Paulsson Board member Susanna Hilleskog Board member

Lars Kongstad Board member Martin Althén Board member

Mari-Katharina Kadowaki Board member

Jonas Lohtander Board member

My Bäck Employee representative Patrik Andersson President and CEO

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
----------------------------------------------------------

	Apr–Jun 2024	Apr–Jun 2023	Jan–Jun 2024	Jan–Jun 2023	R12	Jan–Dec 2023
	306.3
	0.1
	306.4
	1.7			2.2
	-172.8
	-43.7
	-80.3
	-1.1
	-14.6
Other comprehensive income:

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Amount in MSEK	Jun 30, 2024	Jun 30, 2023	Dec 31, 2023
ASSETS
Fixed assets
Intangible assets	135.8	138.8	145.9
Tangible assets	282.2	331.8	285.2
Financial assets	2.7	4.7	4.2
Total fixed assets	420.7	475.3	435.3
Current assets
Inventories	405.1	391.6	395.2
Accounts receivable	273.6	364.4	252.6
Other current receivables	84.5	63.2	65.5
Cash and cash equivalents	21.4	13.8	50.0
Total current assets	784.6	833.2	763.3
TOTAL ASSETS	1,205.3	1,308.7	1,198.6
EQUITY AND LIABILITIES
Share capital	20.0	20.0	20.0
Other reserves	18.1	21.9	13.8
Other contributed capital	1.5	1.5	ાં .5
Other equity including net income for the period	557.5	603.5	574.2
Total equity	597.1	646.9	609.5
Long-term liabilities
Liabilities to credit institutions	75.9	36.0	22.2
Lease liabilities	51.7	57.1	56.1
Other provisions	6.6	9.2	7.0
Deferred tax liabilities	0	0	O
Total long-term liabilities	134.2	102.3	85.3
Short-term liabilities
Liabilities to credit institutions	170.3	214.1	177.6
Lease liabilities	16.7	15.4	16.2
Accounts payable	167.0	188.4	183.3
Other short-term liabilities	120.0	141.7	126.7
Total short-term liabilities	474.0	ર રહેતું રે	503.8
TOTAL EQUITY AND LIABILITIES	1,205.3	1,308.7	1,198.6

condensed consolidated statement of changes in equity

Equity attributable to shareholders in the Parent Company			Other contributed	Retained
Amount in MSEK	Share capital	Reserves	capital	earnings	Total equity
Equity at January 1, 2023	20.0	9.7	1.5	582.9	614.1
Net profit for the period				40.6	40.6
Other comprehensive income for the period		12.2		0	12.2
Dividend to shareholders				-20.0	-20.0
Closing equity, June 30, 2023	20.0	21.9	1.5	603-5	646.9
Equity at January 1, 2024	20.0	13.8	1.5	574.2	609.5
Net loss for the period				-16.7	-16.7
Other comprehensive income for the period		4.3		0	4.3
Dividend to shareholders					0
Closing equity, June 30, 2024	20.0	18.1	1.5	557.5	597.1

CONDENSED CONSOLIDATED CASH-FLOW STATEMENT

	Apr-Jun 2024	Apr-Jun 2023	Jan-Jun 2024	Jan-Jun 2023	R12	Jan-Dec 2023
Amount in MSEK
Cash flow from operating activities
EBIT	-4.3	18.2	- 10.9	45.9	-5.9	51.1
Depreciation/amortization and impairment	14.6	13.0	28.8	22.4	55.0	48.5
Interest paid/received, income tax and adjustment for
non-cash items	-11.9	-5.2	-9.2	-15.1	-51.1	-57.1
Cash flow from operating activities before changes in
working capital	-1.7	26.0	8.7	53.2	-2.0	42.5
Change in working capital
Increase(-)/decrease(+) in inventories	-12.4	-25.3	-2.5	-31.5	-14.0	-43.2
Increase(-) / decrease(+) in operating receivables	-21.7	19.4	-35.2	-47.5	67.0	60.8
Increase(+) / decrease (-) in operating liabilities	26.5	-23.6	-24.0	-24.4	-28.2	-34.5
Cash flow from operating activities	-9.3	-3.5	-53.0	-50.2	22.8	25.6
Investing activities
Investments in intangible assets	-3.3	-8.3	-3.3	-18.0	-20.0	-34.8
Investments in subsidiaries	0	0	0	- 1 . 1	1.1	O
Investments in tangible assets	-3.0	-17.8	-7.3	-58.2	-22.5	-73.4
Disposal of tangible assets	0	0	0	0	57.2	57.2
Cash flow from investing activities	-6.3	-26.1	-10.6	-77.3	15.8	-51.0
Financing activities
Net borrowing/amortization of loans	29.7	54.9	42.2	139.2	2.8	99.9
Amortization of lease liability	-4.4	-4.2	-8.7	-8.5	-15.2	- 14.9
Warrant liquidity received	0	0	0	0	0	0
Dividend paid to shareholders	0	-20.0	0	-20.0	-20.0	-40.0
Cash flow from financing activities	25.3	30.7	33.5	1 10.7	-32.3	45.0
Cash flow for the period	9.7	1.1	-30.1	-16.8	6.3	19.6
Currency effect in cash and cash equivalents	0.4	0.8	1.5	1.1	1.3	0.9
Cash and cash equivalents, start of the period	11.3	11.9	50.0	29.5	13.8	29.5
Cash and cash equivalents, end of the period	21.4	13.8	21.4	13.8	21.4	50.0

condensed parent company income statement

	Apr-Jun	Apr-Jun	Jan-Jun	Jan-Jun	Jan-Dec
Amount in MSEK	2024	2023	2024	2023	2023
Operating income
Net sales	80.2	93.0	156.4	189.5	354.8
	23.2	19.7	47.9	39.5
Other operating income					90.8
Total income	103.4	112.7	204.3	229.0	445.6
Operating expenses
Raw materials and consumables	-52.0	-64.2	-99.8	128.8	-231.4
Other external expenses	-18.9	-17.5	-41.9	35.6	-79.3
Personnel expenses	-21.9	-24.3	-42.7	-46.8	-87.7
Depreciation/amortization of tangible and intangible
assels	-1.4	-1.7	-2.8	-3.5	-6.8
EBIT	9.2	5.0	17.1	14.3	40.4
Result from financial items
Profit/loss from participations in Group companies	0	-0.3	-0.3	-0.7	-1.4
Net interest income and similar items	5.2	7.0	11.1	10.1	18.2
Net interest expenses and similar items	-4.1	0	-4.8	0	-5.9
Profit before tax	10.3	11.7	23.1	23.7	51.5
Appropriations	0	0	0	0	-26.6
Income tax	-2.1	-2.2	-4.8	-4.7	-5.6
Net income	8.2	છે.5	18.3	19.0	19.3

The Parent Company does not have any items recognized as other comprehensive income which is why total compresponds b net income.

CONDENSED PARENT COMPANY BALANCE SHEET

	Jun 30, 2024	Jun 30, 2023	Dec 31, 2023
Amount in MSEK
ASSETS
Fixed assets
Intangible assets	6.3	24.9	31.0
Tangible assets	18.7	30.8	18.9
Participations in Group companies	83.3	81.2	84.0
Other financial assets	153.5	161.0	166.9
Total fixed assets	261.8	297.9	300.8
Current assets
Inventories	29.1	35.0	30.8
Accounts receivable	62.0	83.0	70.2
Other receivables	358.8	292.0	281.8
Cash and bank balances	0	0	0
Total current assets	449.8	410.0	382.8
TOTAL ASSETS	711.6	707.9	683.6
EQUITY AND LIABILITIES
Share capital	20.0	20.0	20.0
Fund for internal development expenses	23.1	40.5	29.5
Statutory reserve	2.6	2.6	2.6
Non-restricted equity including net income for the period	340.7	324.6	316.0
Total equity	386.4	387.7	368.1
Provisions	1.2	3.4	1.2
Long-term liabilities
Liabilities to credit institutions	16.9	21.7	18.7
Total long-term liabilities	16.9	21.7	18.7
Short-term liabilities
Short-term interest-bearing liabilities	163.8	125.3	96.8
Short-term non-interest-bearing liabilities	143.2	169.8	198.8
Total short-term liabilities	307.1	295.1	295.6
TOTAL EQUITY AND LIABILITIES	711.6	707.9	683.6

Overview

NATURE OF OPERATIONS

GARO develops, manufactures and markets innovative products and systems for the electrical installations market under its own brand. The company has operations in Sweden, Norway, Finland, Ireland, Germany, Poland and the UK. The Group is organized in two business areas: GARO Electrification and GARO E-mobility. GARO has a broad product assortment and is a market leader within several product areas.

GARO's business concept is to, with a focus on innovation, sustainability and design, provide profitable complete solutions for the electrical industry.

SEASONAL VARIATIONS

GARO's operations are, to a certain degree, subject to seasonal variations. GARO's sales are generally stable from one quarter to the next, but can fluctuate monthly within the quarter. Sales can be somewhat lower during the vacation months (July-August) and from December to January. During periods of high production, GARO is normally tied up in working capital. Cash and cash equivalents are freed from working capital after the busy season, when the finished products have been installed in customers' facilities and invoices have been paid.

RISKS AND UNCERTAINTIES

As a geographically diversified international group, GARO is exposed to a number of strategic, business-related and financial risks. Strategic risk in GARO is defined as risks that emerge that have a long-term impact on operations such as changes in technology and the macroeconomic trend. Business risks can be divided into operational, sustainability, compliance as well as legal and commercial risks. Financial risks include currency risk, interest-rate risk, raw material price risk, etc. All of these risk areas could negatively impact the business in both the short and the long term, but they can also create business opportunities if they are well managed. Risk management at GARO is based on the operational management groups where material risks for the operations are identified. An assessment is then made of the likelihood that the risks wil materialize and their potential impact. Following this, an evaluation is conducted and decisions are made concerning any actions taken to eliminate or mitigate the risks. More detailed information on GARO's risks and uncertainties can be found in Note 3 on pages 60-63 of the 2023 Annual Report. The Annual Report is available at www.garogroup.se.

RELATED-PARTY TRANSACTIONS

Related-party transactions take place in accordance with the principles described in the 2023 Annual Report. There were no related party transactions during the year except for the payment of fees to the Board of Directors, the remuneration of senior executives and transactions with Group companies.

EMPLOYEES

The number of employees in the Group on June 30, 2024 was 434 (544) excluding persons dismissed and exempted from work. At December 31, 2023, the number of employees was 478.

accounting policies

GARO applies the International Financial Reporting Standards (IFRS) as adopted by the EU, the Swedish Annual Accounts Act (1995: 1554) and the recommendations and statements of the Swedish Financial Reporting Board. This year-end report has been prepared in accordance with IAS 34 Interim Financial Reporting. Disclosures in accordance with IAS 34, 16A are presented in the financial statements and their notes in the interim information on pages 1-20, which constitute an integrated part of this financial statement. In addition, disclosures according to IAS 34.16A are presented in the financial statements and their notes as well as other parts of the interim report.

The Parent Company's interim report was prepared in accordance with Chapter 9 of the Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2.

GARO AB applies the same accounting policies as in the most recent Annual Report.

AUDITORS' STATEMENT

This interim report has not been reviewed by the company's auditors.

SALES AND EBIT BY BUSINESS AREA

	GARO E-mobility GARO Electrification Elimination			Group
Business area information	Q2 2024	Q2 2023	Q2 2024	Q2 2023	Q2 2024	Q2 2023	Q2 2024	Q2 2023
Income
Total external income	287.8	307.2	137.3	251.0	-118.8	-172.2	306.3	386.0
Total internal income	-65.9	-73.3	-52.9	-98.9	118.8	172.2	0	O
Income from contracts with customers	221.9	233.9	84.4	152.1	0	0	306.3	386.0
EBIT	20.4	13.7	-24.7	4.5	0	0	-4.3	18.2
Net financial expenses							-5.4	7.2
Income tax							0.9	-5.4
Net income							-8.9	20.0

REVENUE PER CUSTOMER'S GEOGRAPHIC LOCATION (APR-JUN)

Business Area		GARO Electrification	GARO E-mobility				Total
	Apr-Jun 2024	Apr-Jun 2023	growth, %	Apr-Jun 2024	Apr-Jun 2023	growth, %	Apr-Jun 2024	Apr-Jun 2023	growth, %
Sweden	127.3	145.5	-12	25.5	75.7	-66	152.8	221.2	-31
Nordic region excl. Sweden	31.1	30.9		20.3	38.7	-48	51.4	69.6	-26
Europe excl. Nordic region	63.5	57.5	10	38.7	37.7	က	102.1	95.2	7
Total	221.9	233.9	-5	84.4	152.1	-45	306.3	386.0	-21 -

REVENUE PER CUSTOMER'S GEOGRAPHIC LOCATION (JAN-JUN)

Business Area		GARO Electrification			GARO E-mobility			Total
	Jan-Jun 2024	Jan-Jun 2023	growth, %	Jan-Jun 2024	Jan-Jun 2023	growth, %	Jan-Jun 2024	Jan-Jun 2023	growth, %
Sweden	251.2	304.2	-17	54.1	131.8	-59	305.3	436.0	-30
Nordic region excl. Sweden	55.6	61.3	-9	40.1	77.6	-48	95.7	138.9	-31
Europe excl. Nordic region	123.3	116.4	6	74.6	64.9	15	197.8	181.3	o
Total	430.0	481.9	-11	168.8	274.3	-38	598.8	756.3	-21 -

QUARTERLY FIGURES

External sales per business area Amount in MSEK	Q2 2024	Q1 2024	Q4 2023	Q3 2023	Q2 2023	Q1 2023	Q4 2022	Q3 2022	Q2 2022	Q1 2022	Q4 2021	Q3 2021
GARO E-mobility	84.4	84.3	93.9	93.8	152.1	122.2	80.6	92.1	103.3	146.4	134.4	91.2
GARO Electrification	221.9	208.2	217.3	208.5	233.9	248.1	261.2	224.9	246.9	235.2	235.7	202.7
Total Group	306.3	292.5	311.2	302.3	386.0	370.3	341.8	317.0	350.2	381.6	370.1	293.9
EBIT per business area Amount in MSEK	Q2 2024	Q1 2024	Q4 2023	Q3 2023	Q2 2023	Q1 2023	Q4 2022	Q3 2022	Q2 2022	Q1 2022	Q4 2021	Q3 2021
GARO E-mobility	-24.7	-23.6	-33.0	-15.3	4.5	6.6	-20.9	0.4	3.0	30.7	27.9	20.1
GARO Electrification	20.4	16.9	32.9	20.6	13.7	21.2	29.8	37.0	36.6	36.1	29.8	28.4
Total Group	-4.3	-6.7	-0.1	5.3	18.2	27.8	8.9	37.4	39.6	66.8	57.7	48.5

GARO GROUP MULTI-YEAR OVERVIEW*

		Apr-Jun 2024	Apr-Jun 2023	Jan-Jun 2024	Jan-Jun 2023	R12	2023	2022	2021	2020	2019
Net sales	MSEK	306.3	386.0	598.8	756.3	1,212.3	1,369.9	1,390.5	1,295.8	1,039.8	1,008.1
Growth	%	-21	10	-21	3	- 14	- 1	7	25	3	12
EBITDA	MSEK	10.3	31.1	17.8	68.3	49.2	99.6	188.8	243.0	163.2	134.9
EBITDA margin	ಗಂ	3.4	8.1	3.0	9.0	4.1	7.3	13.6	18.8	15.7	13.4
EBIT	MSEK	-4.3	18.2	-10.9	45.9	-5.9	51.1	152.8	207.2	136.2	112.6
EBIT margin	%	-1.4	4.7	-1.8	6.1	-0.5	3.7	11.0	16.0	13.1	11.2
Earnings per share, before and after dilution	SEK	-0.18	0.40	-0.33	0.81	-0.52	0.63	2.41	3.33	1.9	1.7
Equity per share	SEK	11.94	12.94	11.94	12.94	11.94	12.19	12.28	11.03	8.61	୧:৪୧
Dividend per share	SEK	n/a	n/a	n/a	n/a	n/a	0	0.80	1.40	0.95	0
Dividend	MSEK	n/a	n/a	n/a	n/a	n/a	0	40.0	70.0	47.5	O
Closing rate, share	SEK	26.75	62.85	26.75	62.85	26.75	43.52	108.6	216.0	127.0	61.4
Return on equity	ಗಂ	-4.2	12.1	-4.2	12.1	-4.2	5.1	20.7	34.0	24.7	26.8
Return on capital
employed	96	-0.9	12.6	-0.9	12.6	-0.9	7.9	22.1	39.2	32.2	30.4
Investments	MSEK	6.3	26.1	10.6	76.2	42.5	108.2	120.1	45.3	45.3	33.4
Depreciation	MSEK	14.6	13.0	28.8	22.4	55.0	48.6	36.0	35.8	26.9	22.3
Equity ratio	ಗಂ	49.6	49.4	49.6	49.4	49.6	50.9	53.2	58.9	57.9	52.2
Net debt	MSEK	293.2	308.6	293.2	308.6	293.2	222.1	143.7	-9.4	11.3	45.6
Net debt/EBITDA	multiple	6.0	2.3	6.0	2.2	6.0	2.2	0.8	0.0	0.1	0.3
Number of employees		434	544	434	544	504	478	521	498	412	421

* For definitions, see pages 18-20

Key figures and definitions

The performance measures in this report the nature of the operations and are deemed to provide relevant information to shareholders and other stakeholders and also enable comparability with other companies.

EBIT: Earnings before interest and tax

EBIT margin, %: EBIT as a percentage of net sales for the period

Operating expenses: The total of selling expenses, administrative costs, other operating expenses, excluding amorization and impairment of acquired intangible assets

Earnings per share, before and after dilution, SEK: Net income for the period divided by the average number of shares at the end of the period

Equity per share, SEK: Equity divided by the number of shares at the end of the period

Return on equity, %: Net income for the past 12 months divided by average equity

Return on capital employed, %: EBIT for the past 12 months divided by capital employed.

Equity ratio, %: Equity as a percentage of total assets

Capital employed, SEK: Total assets less short-term liabilities adjusted for cash and bank balances

Net debt/EBITDA, multiple: Net debt at the end of the period as a percentage of EBITDA for the past 12 months

Alternative performance measures

GARO uses certain financial measures – allernative performance measures – that are not defined in the rules for financial reporting that GARO applies. The goal of these performance measures is to creations of how the operations are performing. Investors should view these financial mecsures as a supplement rather than a reporting in accordance with IFRS. It must be stressed that hese cleendive performance measures, as defined, are not entirely comparable with performance measures of the same name used by other companies. GARO uses the following allernative performance measures:

Organic growth: Organic growth with adjustments for currencies other than SEK. This performance measure is expressed as a percentage of the preceding period's net sales.

CHANGE IN NET SALES	Apr-Jun 2024 (MSEK)	Apr-Jun 2024 (%)	Jan-Jun 2024 (MSEK)	Jan-Jun 2024 (%)
Preceding quarter/year	386.0		756.3
Organic sales/growth	-78.5	-20	-158.1	-21
Currency effects	-1.2	-1	0.6	o
Net sales from acquisitions	O		O
Recognized growth	-79.7	-21	-157.5	-21

R12: A summary of the outcome of the past 12 months

Number of employees: The number of employees at the end of the period excluding persons dismissed and exempted from work

EBITDA: A measure of EBIT before interest, taxes, depreciation, and amortization EBITDA margin, %: EBITDA as a percentage of net sales for the period.

Amount in MSEK	Apr-Jun 2024	Apr-Jun 2023	Jan-Jun 2024	Jan-Jun 2023	Jan-Dec 2023
Recognized EBIT	-4.3	18.2	-10.9	45.9	51.1
Reversal of depreciation/amortization	14.6	13.0	28.8	22.4	48.5
EBITDA	10.3	31.2	17.8	68.3	99.6

Net debt: Net debt is defined by how large financial borrowings are in the company in absolute terms less cash and cash equivalents. The performance measure is defined as interest-bearing lines in accordance with IFRS 16, less interest-bearing asses including cash and cash equivalent.

D	Jan-Jun	Jan-Jun	D Jan-Dec
Amount in MSEK	2024	2023	2023
Non-current interest-bearing liabilities	75.9	36.0	22.2
Short-term interest-bearing liabilities	170.3	214.1	177.6
Lease liability as defined under IFRS 16	68.4	72.5	72.3
Less cash and cash equivalents	-21.4	-13.8	-50.0
Net debt	293.2	308.6	222.1
Net debt in relation to total assets (%)	24.3	23.6	18.5

Net debt excluding IFRS I 6: Interest-bearing lecse liabilities in accordance with IFRS 16, less interes-bearing assess including cash and cash equivalents

	Jan-Jun	Jan-Jun	Jan-Dec
	2024	2023	2023
Amount in MSEK
Non-current interest-bearing liabilities	75.9	36.0	22.2
Short-term interest-bearing liabilities	170.3	214.1	177.6
Lease liability as defined under IFRS 16	68.4	72.5	72.3
Less cash and cash equivalents	-21.4	-13.8	-50.0
Reversal of Lease liability as defined under IFRS 16	-68.4	-72.5	-72.3
Net debt excluding IFRS 16	224.9	236.1	149.8

Working copital: GARO's working capital comprises a najor part of the balance sheet's value. In order to optimize the Group's cash generation, management focuses on the development of working capital, for which the performance measure is defined as cash and cash equivalents less short-term non-interest-bearing liabilities, all calculated at the period.

	Jan-Jun 2024	Jan-Jun 2023	Jan-Dec 2023
Amount in MSEK
Current assets	784.6	833.2	763.3
Less cash and cash equivalents	-21.4	-13.8	-50.0
Less short-term non-interest-bearing liabilities	-287.0	-330.1	-310.0
Working capital on balance-sheet date	476.2	489.3	403.3
Working capital in relation to sales (R12), %	39.3	34.6	29.4

Return on capital employed: This performance measure is defined as EBIT for the past 12 months divided by capital end of the period.

Amount in MSEK	Jan-Jun 2024	Jan-Jun 2023	Jan-Dec 2023
EBIT for the past 12 months	-5.9	92.3	51.1
Capital employed at the end of the period	654.0	735.1	643.8
Return on capital employed, %	-0.9	12.6	7.9

Return on equity: This performance measurement is defined as net income for the past 1 2 months divided at the end of he period.

	Jan-Jun 2024	Jan-Jun 2023	Jan-Dec 2023
Amount in MSEK
Net income for the past 12 months	-26.0	74.2	31.3
Equity at the beginning of the period	609.5	574.6	614.1
Equity at the end of the period	597.1	646.9	609.5
Average equity	603.3	611.8	611.8
Return on equity, %	-4.2	12.1	5.1

Economic information

INVITATION TO PRESENTATION FOR THE PRESS AND ANALYSTS

On August 16, 2024, at 9.30 a.m., (CEST), the Pesident and CFO Helena Claesson will present the report and respond to questions in a teleconference.

Telephone numbers:

Sweden:	+46 (0)20 089 0141
International:	+44 (0)207 107 0613

Code: 43 77 94 46

The presentation used during this teleconference can be downloaded at www.garogroup.se under Investor the teleconference will be available on the company's website afterwards.

FOR MORE INFORMATION, PLEASE CONTACT:

Patrik Andersson, President and CEO:	+46 76 148 44 44
Helena Claesson, CFO:	+46 70 676 07 50

FINANCIAL CALENDAR

Second quarter of 2024	August 16, 2024
Third quarter of 2024	November 15, 2024

FORWARD-LOOKING INFORMATION

Certain statements in this report are forward-looking and be significantly different. In addition to the specifically mentioned factors, other factors may have a material income. Such factors include, but are not limited to, the general economic climate, exchange-rate fluctuations and changes in interest rates, political developments products and the prices of such products, difficulties associaed with product development and commercialization, technical problems to the access to raw materials and credit losses attributable to major customers.

GARO IN BRIEF

GARO develops and manufactures innovative products and solution SARO targets both professionals and end users. GARO's brand is your guarantee for electrical sately, userfriendliness and sustainability. GARO was founded in southern Sweden where our distinct entrepreneurial spirit original office remains. There is not much else that is similar from that time. Today, GARO is an international Group with operations in even countries. The foundation of GARO's work is all of the knowledge and experience that the Group has collected since 1939 until today.

This information is such information that GARO AB publish in accordance with the EU Market Abuse Regultion and the Swedish Securities Market Act. The information was published by the abovementioned contact persons on August 16, 2024, at 8.30 a.m. (CET).