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Quarterly Report • Apr 27, 2023
2927_10-q_2023-04-27_302fb8ae-74ff-4767-b840-aab77a5f81d5.pdf
Quarterly Report
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Q1 Interim report first quarter
1 January – 31 March 2023
First quarter 2023
- Order intake increased by 14% to SEK 8,076 million (7,085). For comparable units, it was an increase of 3%.
- Net sales increased by 26% to SEK 8,063 million (6,398). For comparable units, it was an increase of 13%.
- EBITA increased by 28% to SEK 1,225 million (959), corresponding to an EBITA margin of 15.2% (15.0%).
- Profit for the quarter rose 18% to SEK 752 million (638), and earnings per share amounted to SEK 2.06 (1.75).
- Cash flow from operating activities amounted to SEK 632 million (276).
Financial Development
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Order intake | 8,076 | 7,085 | 14% | 28,692 | 27,701 |
| Net sales | 8,063 | 6,398 | 26% | 28,681 | 27,016 |
| Operating profit | 1,079 | 849 | 27% | 3,850 | 3,620 |
| EBITA | 1,225 | 959 | 28% | 4,364 | 4,098 |
| EBITA margin, % | 15.2 | 15.0 | 15.2 | 15.2 | |
| Profit before taxes | 981 | 814 | 21% | 3,607 | 3,440 |
| Net profit | 752 | 638 | 18% | 2,795 | 2,681 |
| Earnings per share before dilution, SEK | 2.06 | 1.75 | 18% | 7.67 | 7.36 |
| Return on capital employed, % | 22 | 23 | 22 | 23 | |
| Cash flow from operating activities | 632 | 276 | 129% | 2,728 | 2,372 |
| Net debt/equity ratio, % | 69 | 52 | 69 | 67 |
Q1 CEO's message
New record quarter with continued profitable growth
First quarter
Demand during the first quarter remained high and stable. Order intake was on par with invoicing and increased by 14% compared to the corresponding period previous year, of which 3% was organic. Order intake increased for the majority of companies during the quarter, with the strongest demand in companies with customers in the energy segment, engineering and process industries. Demand was also at a stable and high level in the medical technology and pharmaceutical customer segment. There was still, however, large variation in the demand between various companies, with the overall weakest development in infrastructure and construction.
Net sales increased by 26%, of which 13% organically and was, for the first time ever, above SEK 8 billion for a single quarter. Net sales increased organically in all business areas, with the strongest growth in the Benelux and Flow Technology business areas, where the majority of companies developed positively. Many companies experienced a continued easing of the disruptions in supply chains during the quarter, which had a positive impact on invoicing. Overall, however, delivery times are still long and some of the disruptions remain.
There was a continued positive trend in profitability during the first quarter and EBITA increased by 28% to SEK 1.2 billion, corresponding to an EBITA margin of 15.2% (15.0%), which is a new record for a first quarter. The improvement was driven by the strong organic growth in combination with a high, stable gross margin and positive contributions from newly acquired companies. The best performance came from the Flow Technology and Benelux business areas, which is primarily attributable to the robust growth in sales.
Good order intake, in combination with long lead times and further price increases from suppliers resulted in some additional inventory build-up during the quarter. On the other hand, cash flow improved significantly compared to the corresponding period previous year thanks to the high earnings and a lower increase in working capital. Despite the high acquisition pace, our financial position remains strong, with room for additional, value-creating acquisitions and organic growth initiatives.
We are continuously working on several initiatives and activities that strengthen our strategic platform. This includes investments in leadership and competence development as well as strengthening our resources in the business areas with the purpose of supporting our companies for organic growth. In this context, sustainability is a prioritised area
where we are, for example, working on the development of a climate training for all companies. Intensive work is also ongoing to ensure that our targets meet all the criteria in SBTi.
Acquisitions
Three companies were acquired early in the first quarter. We welcomed Sax Lift in Denmark, which specialises in scissor lift tables, and we continued strengthening our position in Germany via the acquisition of Hobe, a niche manufacturer of micro precision tools for the shaping of interior profiles. Lastly, we acquired the Dutch company, SKS, with annual sales of approximately SEK 390 million. It offers a diversified portfolio of high-quality, innovative and durable flow technology components to the food & beverage and pharmaceutical process industries.
Subsequent to the end of the quarter, we acquired yet another company – the Danish filter specialist, Safematic. Total annual sales for the companies acquired thus far in 2023 amount to SEK 655 million and all of them are stable and profitable, with good prerequisites for generating continued sustainable, profitable growth. Despite uncertainties about the economic situation, the inflow of interesting, well-managed and stable companies remains at a good level. We have discussions underway with several of them and I am looking forward to welcoming additional successful companies to Indutrade during the year.
Outlook
Overall, the market situation and demand were stable and positive throughout the entire first quarter. We did, however, notice some variation between companies and major uncertainties remain about the general economic outlook. Nevertheless, in several segments, the long-term outlook for our companies is favourable, which is linked to major investment programs in green technology, among others. During the second quarter, we will be faced with challenging comparison figures, but we still have a large, high quality order backlog, which gives us confidence for a positive sales and earnings trend in the near future.
Going forward, the Indutrade model will remain a strength and we have a stable platform that we are continuously developing and improving so that we can keep delivering sustainable, profitable growth.
Bo Annvik, President and CEO
Group performance
Order intake
Overall, demand was high and stable during the first quarter, increasing slightly compared to the corresponding period previous year. For the majority of companies, there was a continued increase in order intake compared to previous year. In the major customer segments, the strongest demand was in the energy segment, along with the engineering and process industries. A stable, high demand was also found in companies with customers in the medical technology & pharmaceutical segment. For infrastructure and construction, demand was somewhat lower than the corresponding period previous year.
Order intake was on a par with invoicing and amounted to SEK 8,076 million (7,085), which is an increase of 14% compared to the corresponding period previous year. For comparable units, order intake increased by 3%, acquisitions contributed with 8% and currency movements had a positive impact of 3%.
Order intake increased organically for seven of the eight business areas, with the strongest growth in Fluids & Mechanical Solutions and Flow Technology. There was a somewhat weaker development in the Finland business area compared to the corresponding period previous year, which is primarily attributable to the strong comparison figures previous year.
Net sales
Net sales continued to develop strongly during the first quarter and increased by 26% compared to the corresponding period previous year, amounting to SEK 8,063 million (6,398). Comparable units increased by 13%, acquisitions contributed with 9% and currency movements had a positive impact of 4%.
Net sales increased organically in all business areas, with the strongest growth in the Benelux and Flow Technology business areas, where the majority of companies and customer segments developed positively.
Disturbances in delivery chains continued to subside for many companies during the quarter. Overall, however, delivery times are still long and some of the disruptions remain.
All business with companies in Russia and Belarus is still suspended because of Russia's invasion of Ukraine at the beginning of last year. The overall direct and indirect exposure to these countries is very limited and the Group does not have any subsidiaries or employees in Russia, Ukraine or Belarus.
Earnings
Operating profit before amortisation of intangible assets attributable to acquisitions (EBITA) amounted to SEK 1,225 million (959) for the first quarter, which is an improvement of 28%. Comparable units increased by 14%, acquisitions contributed with 10% and currency movements had a positive impact of 4%. The EBITA margin increased and amounted to 15.2% (15.0%).
The higher EBITA margin is primarily attributable to the strong organic sales growth, along with good margins in newly acquired companies. Many companies continued raising their prices to customers during the quarter and the gross margin remained at a high level, amounting to 34.6% (34.6%).
The strongest growth in EBITA margin during the quarter came from the Flow Technology and Benelux business areas, primarily due to the robust organic sales growth.
Net financial items during the first quarter amounted to SEK -98 million (-35). The higher financial costs were due to increased borrowing and higher interest rates. Tax on profit for the quarter amounted to SEK -229 million (-176), corresponding to a tax charge of 23% (22%). Profit for the quarter increased by 18% to SEK 752 million (638). Earnings per share before dilution increased by 18% and amounted to SEK 2.06 (1.75).
Return
Return on capital employed remained at a high level but decreased somewhat compared to previous year and amounted to 22% (23%), which is primarily attributable to a higher amount of tied-up capital. Return on equity amounted to 24% (23%).
Business Areas
Benelux
The companies in this business area offer custom-manufactured niche products, design solutions, aftermarket service and assembly, and customisation. The business area includes companies with a considerable amount of own manufacturing and proprietary products. Customers are in the energy, construction & infrastructure, and healthcare segments. Product areas include valves, hydraulic and industrial equipment, and measurement technology. The business area has strong market positions in the Benelux area (Belgium, the Netherlands and Luxembourg).
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 1,405 | 949 | 48% | 4,540 | 4,084 |
| EBITA | 229 | 138 | 66% | 690 | 599 |
| EBITA margin, % | 16.3 | 14.5 | 15.2 | 14.7 |
Net sales increased by 48% during the first quarter to SEK 1,405 million (949). Comparable units increased by 25%, acquisitions contributed with 15% and currency movements had a positive impact of 8%.
Overall, demand during the quarter was somewhat higher than in the corresponding period previous year and order intake increased in the majority of companies. A strong performance was exhibited by valves for power generation, while a weaker performance from companies with customers in construction counteracted this somewhat. Order intake was 7% lower than invoicing during the quarter.
EBITA increased during the first quarter by 66% to SEK 229 million (138), corresponding to an EBITA margin of 16.3% (14.5%). Comparable units increased by 39%, acquisitions contributed with 18% and currency movements had a positive impact of 9%.
The higher EBITA margin is primarily attributable to the strong performance from valves for power generation.
DACH
This business area includes companies that offer custom manufactured niche products, design solutions, aftermarket service and assembly, and customisation. The business area includes companies with a considerable amount of own manufacturing and proprietary products. Customers are in the construction & infrastructure, engineering, healthcare and chemical industries. Product areas include construction material, hydraulic and industrial equipment and valves. Each of the individual companies has a strong market position in the DACH area (Germany, Austria and Switzerland), and most companies are market leaders in their fields.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 626 | 504 | 24% | 2,233 | 2,111 |
| EBITA | 91 | 70 | 30% | 337 | 316 |
| EBITA margin, % | 14.5 | 13.9 | 15.1 | 15.0 |
Net sales increased by 24% during the first quarter to SEK 626 million (504). Comparable units increased by 6%, acquisitions contributed with 8% and currency movements had a positive impact of 10%.
Order intake during the quarter increased organically in approximately half of the business area's companies and overall, demand was somewhat higher than in the corresponding period previous year. Demand improved in the engineering sector, among others, but was counteracted by strong comparison figures for companies with customers in the medical technology and pharmaceutical industry. Order intake was 5% higher than invoicing during the quarter.
EBITA increased during the first quarter by 30% to SEK 91 million (70), corresponding to an EBITA margin of 14.5% (13.9%). Comparable units increased by 5%, acquisitions contributed with 15% and currency movements had a positive impact of 10%.
The improved EBITA margin was primarily driven by good margins in newly acquired companies.
Finland
The Finland business area includes companies that offer sales of components as well as customisation, combinations and installations of products from various suppliers. Customers are in the construction & infrastructure, engineering, water/wastewater, energy and chemical industries. Products range from hydraulics and industrial equipment to measurement technology, valves, service, filters and process technology. The business area has a strong market position in Finland.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 550 | 505 | 9% | 2,265 | 2,220 |
| EBITA | 72 | 73 | -1% | 369 | 370 |
| EBITA margin, % | 13.1 | 14.5 | 16.3 | 16.7 |
Net sales increased by 9% during the first quarter to SEK 550 million (505). Comparable units increased by 2% and currency movements had a positive impact of 7%.
During the quarter, order intake decreased for the majority of the business area's companies and demand was overall lower than in the corresponding period previous year, primarily due to the strong comparison figures. Order intake was 9% higher than invoicing during the quarter.
EBITA decreased during the first quarter by 1% to SEK 72 million (73), corresponding to an EBITA margin of 13.1% (14.5%). Comparable units decreased by 7% and currency movements had a positive impact of 6%.
The lower EBITA margin is primarily attributable to a higher level of activity and overhead costs in many companies.
Flow Technology
Companies in this business area offer components and systems for controlling, measuring, monitoring and regulating flows. The business area includes companies that specialise in various areas of industrial flow technology. Customers are in the process industry, food and pharmaceutical industries, water/wastewater, energy and marine industries. Product areas include valves, pipes and pipe systems, measurement technology, pumps, hydraulics and industrial equipment. The business area has a strong market position especially in Sweden, but also in the Northern Europe.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 1,607 | 1,265 | 27% | 5,749 | 5,407 |
| EBITA | 284 | 200 | 42% | 966 | 882 |
| EBITA margin, % | 17.7 | 15.8 | 16.8 | 16.3 |
Net sales increased by 27% during the first quarter to SEK 1,607 million (1,265). Comparable units increased by 23%, acquisitions contributed with 1% and currency movements had a positive impact of 3%. Divestments had a marginal impact.
Overall, demand during the quarter was higher than during the corresponding period previous year, with positive order development in the majority of the business area's companies. A good demand was exhibited, among others, from customers in the energy, water & wastewater and marine segments. Order intake was 3% lower than invoicing during the quarter.
EBITA increased during the first quarter by 42% to SEK 284 million (200), corresponding to an EBITA margin of 17.7% (15.8%). Comparable units increased by 37%, acquisitions contributed with 2% and currency movements had a positive impact of 3%. Divestments had a marginal impact.
The higher EBITA margin was primarily attributable to the strong sales trend for comparable units.
Fluids & Mechanical Solutions
Companies in this business area offer technological components (both hydraulic and mechanic), as well as solutions that have a high technological content to the industry in, primarily Scandinavia and Europe, but also USA and Asia. The companies have a considerable amount of own manufacturing and proprietary products, as well as technical trading companies. Important product areas include filters, hydraulics, auto repair, tools & transmission, industrial springs, water & wastewater and lighting. The business area has a strong market position in the Nordic region.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 942 | 722 | 30% | 3,190 | 2,970 |
| EBITA | 144 | 113 | 27% | 484 | 453 |
| EBITA margin, % | 15.3 | 15.7 | 15.2 | 15.3 |
Net sales increased by 30% during the first quarter to SEK 942 million (722). Comparable units increased by 7%, acquisitions contributed with 21% and currency movements had a positive impact of 2%.
Overall, demand was higher than in the corresponding period previous year and order intake increased in the majority of companies. The strongest demand came from companies with customers in the automotive aftermarket, as well as the medical technology & pharmaceuticals segments. Order intake was 2% higher than invoicing during the quarter.
EBITA increased during the first quarter by 27% to SEK 144 million (113), corresponding to an EBITA margin of 15.3% (15.7%). Comparable units increased by 10%, acquisitions contributed with 15% and currency movements had a positive impact of 2%.
The lower EBITA margin is primarily explained by weak performance from the infrastructure & construction customer segment.
Industrial Components
Companies in this business area are mainly technical trading companies and offer a wide range of technically advanced components and systems for industrial production and maintenance, as well as medical technology equipment. The products consist mainly of consumables. Its customers exist in the following segments: engineering, healthcare, construction and infrastructure. The product areas include hydraulics and industrial equipment, chemical technology and fasteners. The business area has a strong market position in the Nordic region.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 1,509 | 1,270 | 19% | 5,635 | 5,396 |
| EBITA | 243 | 218 | 11% | 892 | 867 |
| EBITA margin, % | 16.1 | 17.2 | 15.8 | 16.1 |
Net sales increased by 19% during the first quarter to SEK 1,509 million (1,270). Comparable units increased by 9%, acquisitions contributed with 9% and currency movements had a positive impact of 1%.
Demand during the quarter was stronger than in the corresponding period previous year, with an order growth in approximately half of the companies. The medical technology segment had the strongest demand compared to the corresponding period previous year, but there was a positive trend from companies with customers in the engineering industry as well. Order intake was 2% higher than invoicing during the quarter.
EBITA increased during the first quarter by 11% to SEK 243 million (218), corresponding to an EBITA margin of 16.1% (17.2%). Comparable units increased by 1%, acquisitions contributed with 10% and currency movements had a marginal effect.
The lower EBITA margin was primarily attributable to a somewhat lower gross margin for comparable units.
Q1 Measurement & Sensor Technology
Companies in this business area sell measurement instruments, measurement systems, sensors, control and regulating technology, and monitoring equipment for various industries. All of the business area's companies have proprietary products based on advanced technological solutions and own development, design and manufacturing. Its customers exist in a variety of areas, such as various types of manufacturing industries like electronics, vehicles and energy. Companies in this business area work globally and have the entire world as the market for their products, with established production and sales companies on six continents.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 911 | 687 | 33% | 3,173 | 2,949 |
| EBITA | 157 | 131 | 20% | 561 | 535 |
| EBITA margin, % | 17.2 | 19.1 | 17.7 | 18.1 |
Net sales increased by 33% during the first quarter to SEK 911 million (687). Comparable units increased by 13%, acquisitions contributed with 14% and currency movements had a positive impact of 6%.
Overall, demand during the quarter was somewhat higher than in the corresponding period previous year, with order growth in approximately half of the companies. There was a strong performance from, among others, companies with customers in the engineering and electronics industries. Order intake was 1% higher than invoicing during the quarter.
EBITA increased during the first quarter by 20% to SEK 157 million (131), corresponding to an EBITA margin of 17.2% (19.1%). Comparable units increased by 6%, acquisitions contributed with 11% and currency movements had a positive impact of 3%.
The lower EBITA margin was partly attributable to a lower gross margin for comparable units and partly to a slightly weak start to the new year for a couple of the newly acquired companies.
UK
The companies in this business area offer custom-manufactured niche products, design solutions, aftermarket service and assembly, and customisation. They have a considerable amount of own manufacturing and proprietary products. Customer segments include construction and infrastructure, engineering and commercial vehicles. Examples of product areas are springs, piston rings, press work, valve channels, pipes and pipe systems. The individual companies all have strong market positions in the UK, and most are market leaders in their respective niches.
| 2023 | 2022 | 2022/23 | 2022 | ||
|---|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Change | Moving 12 mos | Jan-Dec |
| Net sales | 541 | 520 | 4% | 2,015 | 1,994 |
| EBITA | 65 | 68 | -4% | 228 | 231 |
| EBITA margin, % | 12.0 | 13.1 | 11.3 | 11.6 |
Net sales increased by 4% during the first quarter to SEK 541 million (520). Comparable units increased by 1%, acquisitions contributed with 2% and currency movements had a positive impact of 1%.
Overall, demand during the quarter was higher than in the corresponding period previous year and order intake increased in approximately half of the companies. Companies with customers in, for example, the energy segment, defence sector and aerospace experienced a good demand. Order intake was 4% higher than invoicing during the quarter.
EBITA decreased during the first quarter by 4% to SEK 65 million (68), corresponding to an EBITA margin of 12.0% (13.1%). Comparable units decreased by 8%, acquisitions contributed with 3% and currency movements had a positive impact of 1%.
The lower EBITA margin is primarily explained by higher overhead costs, in turn driven by a higher activity level and higher energy prices. There was also a negative impact on earnings from nonrecurring items in a couple of companies.
Other financial information
Financial position
Shareholders' equity amounted to SEK 13,600 million (11,038) and the equity ratio to 43% (48%). Cash and cash equivalents amounted to SEK 2,102 million (1,189). In addition to that, there were unutilised credit commitments of SEK 6,236 million (4,982). Interest-bearing net debt amounted to SEK 9,390 million (5,766) at the end of the quarter. The increase compared to the corresponding period previous year is primarily attributable to a high rate of acquisition and a somewhat lower operating cash flow during the last year. The net debt/equity ratio was 69% (52%) at the end of the period. Net debt in relation to EBITDA was 1.8x (1.4x).
Indutrade's financing is primarily managed by the Parent Company and it consists of loans from financial institutions, corporate bonds and commercial paper programmes. During the quarter, unsecured bond loans totalling SEK 1,000 million with a duration of 5 years were issued and an agreement was also signed for a new bank loan of EUR 100 million with a duration of 2.5 years, primarily to fund bond repayments and general business purposes. An agreement was also signed during the quarter for an increase in the long-term unutilised bank facilities.
At the end of the quarter, the Parent Company's shortterm borrowing amounted to SEK 600 million and long-term unutilised credit facilities amounted to SEK 5,500 million.
1) Pertains to the Parent Company, which is responsible for most of the Group's financing. Excluding leasing according to IFRS 16.
Cash flow, capital expenditures and depreciation
Cash flow from operating activities increased during the quarter compared to the corresponding period previous year and amounted to SEK 632 million (276). The improvement was partly attributable to higher earnings and partly to a lower increase in working capital compared to the corresponding period previous year. Inventories continued to increase somewhat during the quarter for comparable units, primarily driven by good order intake, long delivery times from suppliers and price increases. The rate of increase was, however, lower than the corresponding period previous year. Working capital efficiency, measured as working capital in relation to net sales on a moving 12-month basis for comparable units, was, due to the higher inventory levels, lower than the corresponding period previous year.
The Group's net capital expenditures, excluding company acquisitions, totalled SEK 140 million (130).
Cash flow after net capital expenditures in intangible non-current assets and in property, plant and equipment (excluding company acquisitions) amounted to SEK 492 million (146).
Depreciation of property, plant and equipment totalled SEK 210 million (174). Investments in company acquisitions amounted to SEK 760 million (101). In addition, payments pertaining to previous years' acquisitions totalled SEK 122 million (57). Divestments amounted to SEK 0 million (0).
In cash flow from operating activities, depreciation of leased assets in the amount of SEK 117 million (96) was added back during the period January – March in accordance with IFRS 16. Lease amortisation is reported as cash flow from financing activities.
Employees
The number of employees was 9,224 at the end of the period, compared with 9,128 at the start of the year.
Company acquisitions
The Group acquired the following companies, which are consolidated for the first time in 2023.
| Month acquired |
Acquisitions | Business area | Net sales/SEK m* | No. of employees* |
|---|---|---|---|---|
| January | Sax Lift A/S | Fluids & Mechanical Solutions | 130 | 34 |
| January | Hobe GmbH | DACH | 80 | 32 |
| January | Siersema Komponenten Service B.V. | Benelux | 390 | 50 |
| Total | 600 | 116 |
*) Estimated annual sales and number of employees at the time of acquisition.
Further information about completed company acquisitions can be found on page 19 of this interim report.
Events after the end of the reporting period
Safematic A/S was acquired on 13 April. For more information, please see page 20.
AGM and dividend
Indutrade's Annual General Meeting was held on 29 March 2023. The shareholders were also able to exercise their voting rights at the Annual General Meeting by postal voting in accordance with the provisions of Indutrade's Articles of Association.
The AGM adopted the Board of Directors' proposal that a dividend of SEK 2.60 per share be paid for the 2022 financial year.
Bo Annvik, Susanna Campbell, Anders Jernhall, Kerstin Lindell, Ulf Lundahl, Katarina Martinson, Krister Mellvé and Lars Pettersson were re-elected as directors for the period until the end of the next AGM. Katarina Martinson was re-elected as Chair of the Board.
The AGM resolved to approve the Board of Directors' proposal regarding the implementation of a long-term incentive programme (LTIP 2023) and hedging arrangements (equity swap agreement) in respect thereof. LTIP 2023 consists of performance shares and compromises members of the group management, including the CEO, business unit leaders, as well as subsidiary MDs and other key employees.
Change in Group management
Morgan O'Brien, SVP Business Development & President UltraPure International, has decided to leave Indutrade and his employment will end on 31 July this year. Coordination responsibility for the UltraPure International activities will be taken over by the business areas where those operations exist.
Parent company
The main functions of Indutrade AB are to take responsibility for business development, talent development, sustainability, acquisitions, financing, business control, analysis and communication. The Parent Company's net sales, which consist entirely of internal invoicing of services, amounted to SEK 0 million (0) during the period January – March. The Parent Company's financial fixed assets consist mainly of shares in subsidiaries. During the period January – March, the Parent Company acquired shares in one company. The Parent Company has not made any major investments in intangible assets or in property, plant and equipment. The number of employees as of 31 March was 20 (21).
Risks and uncertainties
The Indutrade Group conducts business in some 30 countries, on six continents, via more than 200 companies. This diversification, together with a large number of customers in various industries and a large number of suppliers, mitigates the business and financial risks. Besides the risks and uncertainties described in the Indutrade Annual Report for 2022, Indutrade has assessed that no additional significant risks or uncertainties have arisen or dissipated.
Since the Parent Company is responsible for the Group's financing, it is exposed to financing risk. The Parent Company's other activities are not exposed to risks other than indirectly via subsidiaries. For a more detailed account of risks that affect the Group and Parent Company, please see the 2022 Annual Report.
Related party transactions
No transactions took place during the period between Indutrade and related parties that have significantly affected the Company's financial position or result of operations.
Accounting principles
Indutrade reports in accordance with International Financial Reporting Standards (IFRS). This interim report has been prepared in accordance with IAS 34 and RFR 1. The Parent Company applies RFR 2. The same accounting principles and calculation methods have been used for the Group and Parent Company in this report as those in the most recent annual report. There are no new IFRSs or IFRIC pronouncements endorsed by the EU that are applicable for Indutrade or that have a significant impact on the Group's result of operations and position in 2023.
Financial Calendar
- 20 July 2023: Interim report 1 January – 30 June 2023
- 27 October 2023: Interim report 1 January – 30 September 2023
- 1 February 2024: Year-end report 1 January – 31 December 2023
Stockholm, 27 April 2023 Indutrade AB (publ)
Bo Annvik President and CEO
This report has not been reviewed by the company's auditors.
Note
The information in this report is such that Indutrade AB is obligated to make public in accordance with the EU Market Abuse Regulation. The information was submitted for publication by the agency of the following contact persons on 27 April 2023 at 7.30 CEST.
Further information
For further information, please contact: Bo Annvik, President and CEO, tel. +46 8 703 03 00, Patrik Johnson, CFO, tel. +46 70 397 50 30
This report will be commented upon as follows:
A webcast of the report will be presented on 27 April at 9.30 CEST via the following link: https://ir.financialhearings.com/indutrade-q1-2023/register
To participate in the conference call and ask questions, please register yourself via the link below. Once you have registered, you will be given the telephone number and a conference ID to login to the conference call.
https://conference.financialhearings.com/teleconference/?i d=5007983
Q1 Indutrade consolidated income statement – condensed
| 2023 | 2022 | 2022/23 | 2022 | |
|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Net sales | 8,063 | 6,398 | 28,681 | 27,016 |
| Cost of goods sold | -5,271 | -4,186 | -18,739 | -17,654 |
| Gross profit | 2,792 | 2,212 | 9,942 | 9,362 |
| Development costs | -95 | -76 | -353 | -334 |
| Selling costs | -1,134 | -937 | -4,172 | -3,975 |
| Administrative expenses | -483 | -377 | -1,666 | -1,560 |
| Other operating income and expenses | -1 | 27 | 99 | 127 |
| Operating profit | 1,079 | 849 | 3,850 | 3,620 |
| Net financial items | -98 | -35 | -243 | -180 |
| Profit before taxes | 981 | 814 | 3,607 | 3,440 |
| Income Tax | -229 | -176 | -812 | -759 |
| Net profit for the period | 752 | 638 | 2,795 | 2,681 |
| Net profit, attributable to: | ||||
| Equity holders of the parent company | 751 | 637 | 2,796 | 2,682 |
| Non-controlling interests | 1 | 1 | -1 | -1 |
| 752 | 638 | 2,795 | 2,681 | |
| EBITA | 1,225 | 959 | 4,364 | 4,098 |
| Operating profit includes: | ||||
| Amortisation of intangible assets 1) | -158 | -121 | -561 | -524 |
| of which attributable to acquisitions | -146 | -110 | -514 | -478 |
| Depreciation of property, plant and equipment | -210 | -174 | -770 | -734 |
| Earnings per share before dilution, SEK | 2.06 | 1.75 | 7.67 | 7.36 |
| Earnings per share after dilution, SEK | 2.06 | 1.75 | 7.67 | 7.36 |
| 1) Excluding impairment losses |
Indutrade consolidated statement of comprehensive income
| 2023 | 2022 | 2022/23 | 2022 |
|---|---|---|---|
| Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| 752 | 638 | 2,795 | 2,681 |
| 3 | 0 | 7 | 4 |
| -1 | 0 | -2 | -1 |
| 64 | 91 | 489 | 516 |
| - | - | 137 | 137 |
| - | - | -29 | -29 |
| 66 | 91 | 602 | 627 |
| 818 | 729 | 3,397 | 3,308 |
| 817 | 728 | 3,398 | 3,309 |
| 1 | 1 | -1 | -1 |
Indutrade consolidated balance sheet – condensed
| 2023 | 2022 | 2022 | |
|---|---|---|---|
| SEK million | 31-Mar | 31-Mar | 31-Dec |
| Goodwill | 8,283 | 5,564 | 7,649 |
| Other intangible assets | 4,598 | 3,321 | 4,408 |
| Property, plant and equipment | 4,245 | 3,454 | 4,045 |
| Financial assets | 175 | 208 | 160 |
| Inventories | 5,820 | 4,324 | 5,605 |
| Trade receivables | 5,094 | 4,060 | 4,452 |
| Other receivables | 1,285 | 962 | 954 |
| Cash and cash equivalents | 2,102 | 1,189 | 1,589 |
| Total assets | 31,602 | 23,082 | 28,862 |
| Equity | 13,600 | 11,038 | 12,773 |
| Non-current interest-bearing liabilities and pension liabilities | 9,712 | 5,143 | 7,903 |
| Other non-current liabilities and provisions | 1,368 | 972 | 1,300 |
| Current interest-bearing liabilities | 1,780 | 1,812 | 2,266 |
| Trade payables | 2,215 | 1,900 | 1,870 |
| Other current liabilities | 2,927 | 2,217 | 2,750 |
| Total equity and liabilities | 31,602 | 23,082 | 28,862 |
Indutrade consolidated statement of changes in equity – condensed
| Attributable to equity holders of the parent company SEK million |
2023 31-Mar |
2022 31-Mar |
2022 31-Dec |
|---|---|---|---|
| Opening equity | 12,759 | 10,292 | 10,292 |
| Total comprehensive income for the period | 817 | 728 | 3,309 |
| New issues | - | - | 11 |
| Dividend 1) | - | - | -837 |
| Hedging of incentive programme | - | - | -44 |
| Share-based payments | 9 | 6 | 32 |
| Acquisition of non-controlling interests | - | - | -4 |
| Closing equity | 13,585 | 11,026 | 12,759 |
| 1) Dividend per share for 2021 was SEK 2.30 | |||
| Equity, attributable to: | |||
| Equity holders of the parent company | 13,585 | 11,026 | 12,759 |
| Non-controlling interests | 15 | 12 | 14 |
| 13,600 | 11,038 | 12,773 |
Q1 Indutrade consolidated cash flow statement – condensed
| 2023 | 2022 | 2022/23 | 2022 | |
|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Operating profit | 1,079 | 849 | 3,850 | 3,620 |
| Non-cash items | 383 | 290 | 1,313 | 1,220 |
| Interests and other financial items, net | -47 | -27 | -166 | -146 |
| Paid tax | -325 | -242 | -847 | -764 |
| Change in working capital | -458 | -594 | -1,422 | -1,558 |
| Cash flow from operating activities | 632 | 276 | 2,728 | 2,372 |
| Net capital expenditures in non-current assets | -140 | -130 | -508 | -498 |
| Company acquisitions and divestments | -882 | -158 | -3,550 | -2,826 |
| Change in other financial assets | -11 | 6 | -10 | 7 |
| Cash flow from investing activities | -1,033 | -282 | -4,068 | -3,317 |
| Debt/repayment of debt, net | 905 | -280 | 3,002 | 1,817 |
| Dividend paid out | - | - | -837 | -837 |
| New issues | - | - | 11 | 11 |
| Cash flow from financing activities | 905 | -280 | 2,176 | 991 |
| Cash flow for the period | 504 | -286 | 836 | 46 |
| Cash and cash equivalents at start of period | 1,589 | 1,460 | 1,189 | 1,460 |
| Exchange rate differences | 9 | 15 | 77 | 83 |
| Cash and cash equivalents at end of period | 2,102 | 1,189 | 2,102 | 1,589 |
Key data
| 2023 | 2022 | 2022 | 2021 | 2020 | |
|---|---|---|---|---|---|
| Moving 12 mos | 31-Mar | 31-Dec | 31-Mar | 31-Dec | 31-Dec |
| Net sales, SEK million | 28,681 | 27,016 | 22,966 | 21,715 | 19,217 |
| Sales growth, % | 25 | 24 | 18 | 13 | 4 |
| EBITA, SEK million | 4,364 | 4,098 | 3,448 | 3,202 | 2,615 |
| EBITA margin, % | 15.2 | 15.2 | 15.0 | 14.7 | 13.6 |
| Capital employed at end of period, SEK million | 22,990 | 21,353 | 16,804 | 15,792 | 13,512 |
| Capital employed, average, SEK million | 19,607 | 18,111 | 15,141 | 14,516 | 13,541 |
| Return on capital employed, % 1) | 22 | 23 | 23 | 22 | 19 |
| Equity, average, SEK million | 11,883 | 11,272 | 9,773 | 9,297 | 7,899 |
| Return on equity, % 1) | 24 | 24 | 23 | 23 | 21 |
| Interest-bearing net debt at end of period, SEK million | 9,390 | 8,580 | 5,766 | 5,489 | 4,878 |
| Net debt/equity ratio, % | 69 | 67 | 52 | 53 | 56 |
| Net debt/EBITDA, times | 1.8 | 1.8 | 1.4 | 1.4 | 1.5 |
| Equity ratio, % | 43 | 44 | 48 | 47 | 48 |
| Average number of employees | 8,726 | 8,483 | 7,923 | 7,715 | 7,349 |
| Number of employees at end of period | 9,224 | 9,128 | 8,288 | 8,185 | 7,270 |
| Attributable to equity holders of the parent company Key ratios per share |
|||||
| Earnings per share before dilution, SEK | 7.67 | 7.36 | 6.24 | 5.76 | 4.60 |
| Earnings per share after dilution, SEK | 7.67 | 7.36 | 6.24 | 5.75 | 4.59 |
| Equity per share, SEK | 37.29 | 35.02 | 30.28 | 28.26 | 23.72 |
| Cash flow from operating activities per share, SEK | 7.49 | 6.51 | 7.25 | 7.84 | 7.66 |
| Average number of shares before dilution, '000 | 364,304 | 364,270 | 364,062 | 363,921 | 362,721 |
| Average number of shares after dilution, '000 | 364,316 | 364,303 | 364,234 | 364,180 | 363,320 |
| Number of shares at the end of the period, '000 | 364,323 | 364,323 | 364,188 | 364,188 | 363,615 |
1) Calculated on average capital and equity.
Q1
| 2023 | 2022 | 2022/23 | 2022 | |
|---|---|---|---|---|
| Net sales, SEK million | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Benelux | 1,405 | 949 | 4,540 | 4,084 |
| DACH | 626 | 504 | 2,233 | 2,111 |
| Finland | 550 | 505 | 2,265 | 2,220 |
| Flow Technology | 1,607 | 1,265 | 5,749 | 5,407 |
| Fluids & Mechanical Solutions | 942 | 722 | 3,190 | 2,970 |
| Industrial Components | 1,509 | 1,270 | 5,635 | 5,396 |
| Measurement & Sensor Technology | 911 | 687 | 3,173 | 2,949 |
| UK | 541 | 520 | 2,015 | 1,994 |
| Parent company and Group items | -28 | -24 | -119 | -115 |
| Total | 8,063 | 6,398 | 28,681 | 27,016 |
| 2023 | 2022 | 2022/23 | 2022 | |
| EBITA, SEK million | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Benelux | 229 | 138 | 690 | 599 |
| DACH | 91 | 70 | 337 | 316 |
| Finland | 72 | 73 | 369 | 370 |
| Flow Technology | 284 | 200 | 966 | 882 |
| Fluids & Mechanical Solutions | 144 | 113 | 484 | 453 |
| Industrial Components | 243 | 218 | 892 | 867 |
| Measurement & Sensor Technology | 157 | 131 | 561 | 535 |
| UK | 65 | 68 | 228 | 231 |
| Parent company and Group items | -60 | -52 | -163 | -155 |
| Total | 1,225 | 959 | 4,364 | 4,098 |
| 2023 | 2022 | 2022/23 | 2022 | |
| EBITA margin, % | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Benelux | 16.3 | 14.5 | 15.2 | 14.7 |
| DACH | 14.5 | 13.9 | 15.1 | 15.0 |
| Finland | 13.1 | 14.5 | 16.3 | 16.7 |
| Flow Technology | 17.7 | 15.8 | 16.8 | 16.3 |
| Fluids & Mechanical Solutions | 15.3 | 15.7 | 15.2 | 15.3 |
| Industrial Components | 16.1 | 17.2 | 15.8 | 16.1 |
| Measurement & Sensor Technology | 17.2 | 19.1 | 17.7 | 18.1 |
| UK | 12.0 | 13.1 | 11.3 | 11.6 |
| 15.2 | 15.0 | 15.2 | 15.2 |
Business area performance per quarter
| 2023 | 2022 | ||||
|---|---|---|---|---|---|
| Net sales, SEK million | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar |
| Benelux | 1,405 | 1,153 | 1,012 | 970 | 949 |
| DACH | 626 | 534 | 552 | 521 | 504 |
| Finland | 550 | 605 | 565 | 545 | 505 |
| Flow Technology | 1,607 | 1,370 | 1,387 | 1,385 | 1,265 |
| Fluids & Mechanical Solutions | 942 | 781 | 714 | 753 | 722 |
| Industrial Components | 1,509 | 1,514 | 1,270 | 1,342 | 1,270 |
| Measurement & Sensor Technology | 911 | 821 | 749 | 692 | 687 |
| UK | 541 | 480 | 490 | 504 | 520 |
| Parent company and Group items | -28 | -30 | -32 | -29 | -24 |
| Total | 8,063 | 7,228 | 6,707 | 6,683 | 6,398 |
| 2023 | 2022 | ||
|---|---|---|---|
| EBITA, SEK million | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar |
|---|---|---|---|---|---|
| Benelux | 229 | 167 | 139 | 155 | 138 |
| DACH | 91 | 80 | 88 | 78 | 70 |
| Finland | 72 | 96 | 105 | 96 | 73 |
| Flow Technology | 284 | 222 | 224 | 236 | 200 |
| Fluids & Mechanical Solutions | 144 | 116 | 108 | 116 | 113 |
| Industrial Components | 243 | 227 | 204 | 218 | 218 |
| Measurement & Sensor Technology | 157 | 142 | 134 | 128 | 131 |
| UK | 65 | 51 | 53 | 59 | 68 |
| Parent company and Group items | -60 | -20 | -20 | -63 | -52 |
| Total | 1,225 | 1,081 | 1,035 | 1,023 | 959 |
| 2022 | |
|---|---|
| EBITA margin, % | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar |
|---|---|---|---|---|---|
| Benelux | 16.3 | 14.5 | 13.7 | 16.0 | 14.5 |
| DACH | 14.5 | 15.0 | 15.9 | 15.0 | 13.9 |
| Finland | 13.1 | 15.9 | 18.6 | 17.6 | 14.5 |
| Flow Technology | 17.7 | 16.2 | 16.1 | 17.0 | 15.8 |
| Fluids & Mechanical Solutions | 15.3 | 14.9 | 15.1 | 15.4 | 15.7 |
| Industrial Components | 16.1 | 15.0 | 16.1 | 16.2 | 17.2 |
| Measurement & Sensor Technology | 17.2 | 17.3 | 17.9 | 18.5 | 19.1 |
| UK | 12.0 | 10.6 | 10.8 | 11.7 | 13.1 |
| 2022 | ||||
|---|---|---|---|---|
| 15.2 | 15.0 | 15.4 | 15.3 | 15.0 |
Q1 Disaggregation of revenue
Net sales per geographic market
| 2023 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Jan-Mar, SEK million | Benelux | DACH | Finland | FT | FMS | IC | MST | UK | Elim.1) | Total |
| Nordic countries | 31 | 4 | 478 | 858 | 677 | 1,329 | 168 | 25 | -10 | 3,560 |
| Other Europe | 1,193 | 598 | 50 | 633 | 229 | 152 | 338 | 461 | -11 | 3,643 |
| Americas | 93 | 14 | 12 | 10 | 24 | 18 | 256 | 28 | -3 | 452 |
| Asia | 67 | 9 | 9 | 82 | 8 | 8 | 127 | 24 | -3 | 331 |
| Other | 21 | 1 | 1 | 24 | 4 | 2 | 22 | 3 | -1 | 77 |
| 1,405 | 626 | 550 | 1,607 | 942 | 1,509 | 911 | 541 | -28 | 8,063 | |
| Timing of revenue recognition | Benelux | DACH | Finland | FT | FMS | IC | MST | UK | Elim.1) | Total |
| Over time | 16 | 80 | 0 | 0 | 72 | 3 | 71 | 0 | 0 | 242 |
| Point in time | 1,389 | 546 | 550 | 1,607 | 870 | 1,506 | 840 | 541 | -28 | 7,821 |
| 1,405 | 626 | 550 | 1,607 | 942 | 1,509 | 911 | 541 | -28 | 8,063 | |
| 2022 | ||||||||||
| Jan-Mar, SEK million | Benelux | DACH | Finland | FT | FMS | IC | MST | UK | Elim.1) | Total |
| Nordic countries | 16 | 5 | 412 | 674 | 545 | 1,110 | 133 | 32 | -10 | 2,917 |
| Other Europe | 814 | 478 | 41 | 439 | 143 | 142 | 249 | 429 | -9 | 2,726 |
| Americas | 55 | 12 | 7 | 5 | 24 | 14 | 205 | 26 | -3 | 345 |
| Asia | 46 | 8 | 12 | 138 | 8 | 4 | 78 | 27 | -1 | 320 |
| Other | 18 | 1 | 33 | 9 | 2 | 0 | 22 | 6 | -1 | 90 |
| 949 | 504 | 505 | 1,265 | 722 | 1,270 | 687 | 520 | -24 | 6,398 | |
| Timing of revenue recognition | Benelux | DACH | Finland | FT | FMS | IC | MST | UK | Elim.1) | Total |
| Over time | 12 | 76 | 0 | 0 | 48 | 3 | 60 | 0 | 0 | 199 |
| Point in time | 937 | 428 | 505 | 1,265 | 674 | 1,267 | 627 | 520 | -24 | 6,199 |
1) Parent company & Group items
FT - Flow Technology FMS - Fluids & Mechanical Solutions
IC - Industrial Components MST - Measurement & Sensor Technology
Acquisitions
Acquisitions during the interim period
All of the shares were acquired in Sax Lift A/S (Denmark), Hobe GmbH (Germany) and Siersema Komponenten Service B.V. (Netherlands).
Benelux
On 19 January, Siersema Komponenten Service B.V. (Netherlands) was acquired, with annual sales of SEK 390 million. SKS is a specialised technical trading company offering flow technology components to the food and pharmaceutical industries.
DACH
On 10 January, Hobe GmbH (Germany) was acquired, with annual sales of SEK 80 million. Hobe manufactures micro precision tools for the shaping of interior profiles in very small bores.
Fluids & Mechanical Solutions
On 3 January, Sax Lift A/S (Denmark) was acquired, with annual sales of SEK 130 million. Sax Lift manufactures standard and custom-made scissor lift tables.
Acquired assets and liabilities in 2023
Preliminary purchase price allocations
SEK million
| Purchase price, incl. contingent earn-out | |
|---|---|
| payment totalling SEK 36 million | 831 |
| Acquired assets and liabilities | Book value |
Fair value adjustment |
Fair value |
|---|---|---|---|
| Goodwill | 47 | 524 | 571 |
| Agencies, trademarks, customer | |||
| relations, licenses, etc. | 0 | 301 | 301 |
| Property, plant and equipment | 37 | - | 37 |
| Financial assets | 1 | - | 1 |
| Inventories | 121 | - | 121 |
| Other current assets 1) | 60 | - | 60 |
| Cash and cash equivalents | 35 | - | 35 |
| Deferred tax liability | 0 | -74 | -74 |
| Other operating liabilities | -222 | 1 | -221 |
| 79 | 752 | 831 |
1) Mainly trade receivables
Agencies, customer relationships, licences, etc. will be amortised over a period of 5–20 years, while trademarks are assumed to have indefinite useful life. Trademarks are included at a value of SEK 8 million (0).
Indutrade typically uses an acquisition structure entailing a base level of consideration plus a contingent earn-out payment. Initially, the contingent earn-out payment is valued at the present value of the likely outcome, which for the acquisitions made during the year amounts to SEK 36 (59) million. The contingent earn-out payments fall due for payment within three years and can amount to a maximum of SEK 65 million (63). If the conditions are not met, the outcome can be in the range of SEK 0-65 million.
Transaction costs during the interim period totalled SEK 2 million (2) and are included in Other income and expenses in the income statement. Contingent earn-out payments were restated in the amount of SEK 4 million (22). The effect is reported under Other income and expenses in the amount of SEK 4 million (21) and under Net financial items in the amount of SEK 0 million (1).
The acquisition calculations for Autoroll UK Ltd och NTi Audio AG, which were acquired during the first quarter of 2022 have now been finalised. No significant adjustments have been made to the calculations. For other acquisitions, the acquisition calculations are preliminary. Indutrade regards the calculations as preliminary during the time that uncertainty exists with respect to, for example, the outcome of guarantees in the acquisition agreements concerning inventories and trade receivables.
Cash flow impact
SEK million
| Purchase price, incl. contingent earn-out payments | 831 |
|---|---|
| Purchase price not paid out | -36 |
| Cash and cash equivalents in acquired companies | -35 |
| Payments pertaining to previous years´acquisitions | 122 |
| Total cash flow impact | 882 |
Effects of acquisitions carried out in 2022 and 2023
| SEK million | Net sales | EBITA |
|---|---|---|
| Business area | Jan-Mar | Jan-Mar |
| Benelux | 145 | 25 |
| DACH | 42 | 11 |
| Finland | - | - |
| Flow Technology | 13 | 3 |
| Fluids & Mechanical Solutions | 152 | 17 |
| Industrial Components | 113 | 21 |
| Measurement & Sensor Technology | 96 | 14 |
| UK | 8 | 2 |
| Effect on Group | 569 | 93 |
| Acquisitions carried out in 2022 | 451 | 70 |
| Acquisitions carried out in 2023 | 118 | 23 |
| Effect on Group | 569 | 93 |
If all of the acquired units had been consolidated as of 1 January 2023, net sales would have amounted to SEK 8,093 million and EBITA to SEK 1,227 million.
Acquisitions after the end of the reporting period
On 13 April, Safematic A/S was acquired, with annual sales of approximately SEK 55 million. Safematic specialises in process and ventilation filtration, offering filter solutions to the food, energy and pharmaceutical industries, among others.
Share Data
At the end of the interim
| period the share capital amounted to SEK 729 million | |
|---|---|
| Number of shares at the beginning of the year | 364,323,000 |
|---|---|
| Number of newly subscribed shares | 0 |
| Total number of shares outstanding after new | |
| issues | 364,323,000 |
LTIP 2021 and 2022
The 2021 and 2022 AGMs resolved on new incentive programmes. LTIP 2021 covers around 235 employees and is aimed at senior executives and other key employees. It requires own investment and it consists of performance shares. The scope of the programme is, at most, 650,000 shares in Indutrade, which corresponds to approximately 0.18% of all shares and votes.
LTIP 2022 covers around 265 employees and is aimed at senior executives and other key employees. LTIP 2022 requires own investment and it consists of performance shares. The scope of the programme is, at most, 425,000 shares in Indutrade, which corresponds to approximately 0.12% of all shares and votes.
For both programmes, the participant shall receive performance shares provided that the employment is not terminated, the investment shares have been retained and the performance targets have been fulfilled. Performance targets are based on the development of earnings per share during the performance period.
During the interim period, SEK 9 million (6) (excluding social security contributions) were expensed as a result of the programme.
| Outstanding programme |
Number of investment shares |
Corresponding maximum number of performance shares |
Proportion of total shares |
Vesting period |
|---|---|---|---|---|
| Programme launch June 2021 – interim report publication first quarter | ||||
| LTIP 2021 | 116,735 | 373,234 | 0.1% | 2024 |
| Programme launch May 2022 – interim report publication first quarter | ||||
| LTIP 2022 | 57,500 | 186,915 | 0.1% | 2025 |
Outstanding incentive programmes
Q1 Financial assets and liabilities
| 31 Mar 2023, SEK million | Interest rate swaps and currency forward contracts in hedge accounting |
Amortised cost |
Holdings of shares and participation in unlisted companies |
Contingent earn-out payments |
Financial liabilities measured at amortised cost |
Total carrying amount |
Fair value |
|---|---|---|---|---|---|---|---|
| Valuation classification | Level 2 | Level 3 | Level 3 | ||||
| Other shares and participations |
- | - | 12 | - | - | 12 | 12 |
| Trade receivables | - | 5,094 | - | - | - | 5,094 | 5,094 |
| Other receivables | 10 | 50 | - | - | - | 60 | 60 |
| Cash and cash equivalents | - | 2,102 | - | - | - | 2,102 | 2,102 |
| Total | 10 | 7,246 | 12 | - | - | 7,268 | 7,268 |
| Non-current interest bearing liabilities |
- | - | - | 526 | 8,940 | 9,466 | 9,461 |
| Current interest-bearing liabilities |
- | - | - | 626 | 1,154 | 1,780 | 1,781 |
| Trade payables | - | - | - | - | 2,215 | 2,215 | 2,215 |
| Other liabilities | 5 | - | - | - | - | 5 | 5 |
| Total | 5 | - | - | 1,152 | 12,309 | 13,466 | 13,462 |
| 31 Dec 2022, SEK million | Interest rate swaps and currency forward contracts in hedge accounting |
Amortised cost |
Holdings of shares and participation in unlisted companies |
Contingent earn-out payments |
Financial liabilities measured at amortised cost |
Total carrying amount |
Fair value |
|---|---|---|---|---|---|---|---|
| Valuation classification | Level 2 | Level 3 | Level 3 | ||||
| Other shares and participations |
- | - | 13 | - | - | 13 | 13 |
| Trade receivables | - | 4,452 | - | - | - | 4,452 | 4,452 |
| Other receivables | 5 | 24 | - | - | - | 29 | 29 |
| Cash and cash equivalents | - | 1,589 | - | - | - | 1,589 | 1,589 |
| Total | 5 | 6,065 | 13 | - | - | 6,083 | 6,083 |
| Non-current interest bearing liabilities |
- | - | - | 979 | 6,681 | 7,660 | 7,626 |
| Current interest-bearing liabilities |
- | - | - | 241 | 2,025 | 2,266 | 2,266 |
| Trade payables | - | - | - | - | 1,870 | 1,870 | 1,870 |
| Other liabilities | 2 | - | - | - | - | 2 | 2 |
| Total | 2 | - | - | 1,220 | 10,576 | 11,798 | 11,764 |
Financial instruments are measured at fair value, based on the classification of the fair value hierarchy: other observable data for assets and liabilities than quoted prices [level 2], non-observable market data [level 3].
No transfers were made between levels 2 and 3 during the period. Contingent earn-out payments have been discounted to present value using an interest rate that is judged to be in line with the market rate at the time of acquisition. Adjustments are not made on a regular basis for changes in the market interest rate, since the effects of these are judged to be negligible.
| Contingent earn-out payments | 2023 | 2022 |
|---|---|---|
| SEK million | 31-Mar | 31-Dec |
| Opening book value | 1,220 | 861 |
| Acquisitions during the year | 36 | 659 |
| Consideration paid | -119 | -235 |
| Reclassified via income statement | -5 | -139 |
| Interest expenses | 8 | 14 |
| Exchange rate differences | 12 | 60 |
| Closing book value | 1,152 | 1,220 |
Parent company income statement – condensed
| 2023 | 2022 | 2022/23 | 2022 | |
|---|---|---|---|---|
| SEK million | Jan-Mar | Jan-Mar | Moving 12 mos | Jan-Dec |
| Net sales | 0 | 0 | 11 | 11 |
| Gross profit | 0 | 0 | 11 | 11 |
| Administrative expenses | -38 | -35 | -149 | -146 |
| Operating profit | -38 | -35 | -138 | -135 |
| Financial income/expenses | 14 | 23 | 82 | 91 |
| Profit from participation in Group companies | 1 | - | 1,928 | 1,927 |
| Profit after financial items | -23 | -12 | 1,872 | 1,883 |
| Appropriations | - | - | 850 | 850 |
| Income Tax | 5 | 2 | -165 | -168 |
| Net profit for the period | -18 | -10 | 2,557 | 2,565 |
| Amortisation/depreciation of intangible assets and property, plant and equipment | 0 | 0 | -1 | -1 |
Parent company balance sheet – condensed
| 2023 | 2022 | 2022 | |
|---|---|---|---|
| SEK million | 31-Mar | 31-Mar | 31-Dec |
| Intangible assets | 1 | 0 | 1 |
| Property, plant and equipment | 1 | 1 | 2 |
| Financial assets | 11,247 | 7,102 | 9,785 |
| Current receivables | 9,421 | 8,057 | 10,939 |
| Cash and cash equivalents | 1,073 | 275 | 592 |
| Total assets | 21,743 | 15,435 | 21,319 |
| Equity | 9,938 | 8,246 | 9,956 |
| Untaxed reserves | 867 | 755 | 867 |
| Non-current interest-bearing liabilities and pension liabilities | 8,248 | 3,635 | 6,386 |
| Other non-current liabilities and provisions | 4 | 0 | 4 |
| Current interest-bearing liabilities | 2,570 | 2,720 | 3,710 |
| Current non-interest-bearing liabilities | 116 | 79 | 396 |
| Total equity and liabilities | 21,743 | 15,435 | 21,319 |
Q1 Definitions
Alternative Performance Measures
In this interim and Year-End report Indutrade presents Alternative Performance Measures (APMs) that complement the key financial ratios defined in IFRS. The company believes that these APMs provide valuable information to stakeholders, as they contribute to assessment of the company's performance, trends, ability to repay debt and invest in new business opportunities, and they reflect the Group's acquisition-intensive business model.
Since not all companies calculate their financial key ratios in the same way, they are not always comparable. They should therefore not be regarded as a substitute for the key ratios defined in IFRS. Following are definitions of Indutrade's key ratios, of which most are APMs.
Capital employed
Shareholders' equity plus interest-bearing net debt.
Earnings per share before dilution
Net profit for the period attributable to owners of the parent divided by the average number of shares outstanding. Definition according to IFRS.
Earnings per share after dilution
Net profit for the period attributable to owners of the parent divided by the average number of shares outstanding after dilution.
EBITA
Operating profit before amortisation of intangible noncurrent assets arising in connection with company acquisitions (Earnings Before Interest, Tax and Amortisation). EBITA is the principal measure of the Group's earnings.
EBITA-margin
EBITA divided by net sales.
EBITDA
Operating profit before depreciation and amortisation (Earnings Before Interest, Tax, Depreciation and Amortisation).
Equity per share
Shareholders' equity attributable to owners of the parent divided by the number of shares outstanding.
Equity ratio
Shareholders' equity divided by total assets.
Gross margin
Gross profit divided by net sales.
Interest-bearing net debt
Interest-bearing liabilities including pension liability and estimated earn-outs for acquisitions, less cash and cash equivalents.
Net capital expenditures
Purchases less sales of intangible non-current assets and of property, plant and equipment, excluding those included in acquisitions and divestments of subsidiaries and operations.
Net debt/equity ratio
Interest-bearing net debt divided by shareholders' equity.
Net debt/EBITDA
Interest-bearing net debt at the end of the period divided by EBITDA on a moving 12-month basis.
Return on equity
Net profit for the period on a moving 12-month basis divided by average shareholders' equity per month.
Return on capital employed
EBITA calculated on a moving 12-month basis divided by average capital employed per month.
Indutrade in brief
Indutrade is an international technology and industrial business group that today consists of approximately 200 companies in some 30 countries, mainly in Europe. In a decentralised way, we work to provide sustainable profitable growth by developing and acquiring successful companies managed by passionate entrepreneurs. Our companies develop, manufacture, and sell components, systems and services with significant technical content in selected niches. Our value-based culture, where people make the difference, has been the foundation of our success since the start in 1978.
Customers can be found in a wide range of industries, including infrastructure, medical technology/pharmaceuticals, engineering, energy, water/wastewater and food.
The Group is structured into eight business areas: Benelux, DACH, Finland, Flow Technology, Fluids & Mechanical Solutions, Industrial Components, Measurement & Sensor Technology and UK.
The Group's financial targets are that: Sales growth
• Average sales growth shall amount to a minimum of 10% per year over a business cycle. Growth is to be achieved organically as well as through acquisitions.
EBITA-margin
• The EBITA margin shall amount to a minimum of 14% per year over a business cycle.
Return on capital employed
• The return on capital employed shall be a minimum of 20% per year on average over a business cycle.
Net debt/equity ratio
• The net debt/equity ratio should normally not exceed 100%.
Dividend payout ratio
• The dividend payout ratio shall range from 30% to 50% of net profit.
1)Financial year 2022
This is an unofficial translation of the original Swedish text. In the event of any discrepancy between the English translation and the Swedish original, the Swedish version shall govern.
Indutrade AB (publ.)
Reg.no. 556017-9367. Box 6044, SE-164 06 Kista. Visiting address: Raseborgsgatan 9. Tel: +46 8 703 03 00 www.indutrade.com
Welcome Safematic!
In April, Indutrade acquired the Danish company, Safematic A/S, with annual sales of SEK 55 million. Safematic is specialised in process and ventilation filtration, offering highquality filter solutions to the food, energy and pharmaceutical industries, among others.
Based on its technical expertise in customer application areas, the company has a high degree of consultative sales and long-lasting relations with its customers and partners. Safematic has good prospects for sustainable, profitable growth and the acquisition strengthens Indutrade's cluster of filter companies in Denmark.
CEO's speech from the 2023 AGM
Indutrade's Annual General Meeting was held on 29 March 2023 at IVA Conference Center in Stockholm. Shareholders were also able to exercise their voting rights at the AGM via postal voting.
At the AGM, Indutrade's President and CEO, Bo Annvik, gave a speech, reflecting on the past year and commenting on both the current market situation and path forward for the group.
The speech was recorded and is available for viewing at the following link: https://creo-
live.creomediamanager.com/483dcb3e-def2-4b7e-a3d9- 9deddbebc13e
Annual report and sustainability report 2022
In March, Indutrade published its annual report and sustainability report for 2022. The report, which is available on our website, contains more information about Indutrade's strategy for sustainable, profitable growth, along with our sustainability work and progress in 2022.
We are convinced that systematic sustainability efforts, integrated into the business strategy, is a prerequisite for long-term value creation. The starting point for Indutrade's sustainability efforts is the principles stated in the UN Global Compact and it is founded on all companies working in a structured way with their own material sustainability areas and goals, together with the Group-wide focus areas and goals.
