Interim / Quarterly Report • Aug 20, 2020
Interim / Quarterly Report
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The second quarter
There were no material events subsequent to the end of the reporting period.
1 The calculation of the net asset value on 19 August was based on the value of the investment portfolio at 1 p.m. on 19 August, and the same values as at 30 June were used for the unlisted portfolio.
Investment AB Latour is a mixed investment company consisting primarily of a wholly-owned industrial operations and an investment portfolio of listed holdings in which Latour is the principal owner or one of the principal owners. The investment portfolio consists of nine substantial holdings that had a market value of SEK 59.6 billion as at 30 June 2020. The wholly-owned industrial operations are grouped into five business areas: Caljan, Hultafors Group, Latour Industries, Nord-Lock Group and Swegon. They generate annual sales amounting to approximately SEK 15 billion.
turbulence caused by the Covid-19 pandemic. We and our companies were quick to adapt our operations to the new conditions. Employee safety has been a top priority and considerable work has gone into understanding how much of an impact the pandemic would have. While the effects of the pandemic are far from over, we are pleased to report that we have come out of this difficult and highly uncertain quarter largely unscathed. We own well-managed companies that can be described as quality assets this is proved, in particular by the development in the second quarter. The key question now for us and many others is how the market in general will develop as we go forward, in both the short and long term.
Adjusted for acquisitions and foreign exchange effects, the order intake fell by 15 per cent and net sales fell by 13 per cent during the second quarter. The quarter's operating profit was down 8 per cent, as against the very strong yearago quarter, to SEK 474 m (512 m), with an operating margin of 13.4 (14.6) per cent, which we are very satisfied with considering the current circumstances.
Our operations have had a strong focus on cost awareness across their activities and taken significant measures to mitigate the effects of Covid-19. The business areas have benefited from state support programs where applicable, but only to a relatively small extent. Some operations have implemented short-time working. The restrictions imposed in various parts of the world have obviously impacted our operations to varying degrees, depending on the market and segments. Our portfolio is diversified and comprises holdings that are exposed to a range of geographic markets, customers and product segments, and this has reduced the negative impacts caused by the pandemic. It can be generally stated that the northern European countries have been impacted to a lesser extent, while the UK, France, Belgium, Spain and Italy have been affected far more severely. We have seen signs of recovery in the most affected regions towards the end of the quarter.
We have been cautious about new acquisitions during the quarter but have continued to apply our forward-thinking approach and invest in product development, sales and marketing for future business growth. We are also investing in our factories and currently have a high rate of investment. We are maintaining a strong focus on sustainability which is key to underpinning future growth.
In May, 7.8 million Tomra shares were sold from the investment portfolio, which meant we realised a small portion of the increase in value from our original investment amount in Tomra in 2011. The sale result in a wider scope for new investments while Latour still remains the largest shareholder in Tomra.
Since the start of the year, our investment portfolio has declined by 4.7 per cent, adjusted for changes in the portfolio and dividends, while the benchmark index SIXRX fell by 4.1 per cent. In light of the ongoing pandemic, second-quarter growth has also been good in our listed holdings. Several companies have experienced a considerable decline in the organic growth in sales, but are showing great resilience and are reporting strong operating profit. The net asset value in Latour decreased by 5.5 per cent to SEK 127 per share in the same period.
It is gratifying that we in the last quarter have been able to give two internal candidates the opportunity for a career development within Latour in competition with external candidates. Andreas Örje Wellstam, who has worked in Latour and Swegon since 2010, has been appointed new CEO of Swegon. In addition, Ole Kristian Jødahl, former CEO of Hultafors Group, was during the spring recruited to the position of CEO in our investment portfolio company Alimak Group.
Latour's Board revised the dividend proposal from SEK 2.75 to SEK 1.25 per share. This was approved by the Annual
Johan Hjertonsson President and Chief Executive Officer
In the second quarter, the order intake fell by 1 per cent to SEK 3,996 m (3,325 m), with organic growth accounting for minus 15 per cent of this. Invoicing increased 1 per cent to SEK 3,542 m (3,511 m), which represents a 13 per cent decrease for comparable entities adjusted for foreign exchange effects. The operating profit in the wholly-owned industrial operations decreased by 8 per cent to SEK 474 m (512 m) during the quarter. The operating margin was 13.4 (14.6) per cent.
The above figures only include subsidiaries of the whollyowned business areas. See the separate report on page 5.
There were no business acquisitions or sales in the whollyowned industrial operations in the second quarter.
Four transactions took place earlier on in the year. The acquisition of S+S Regeltechnik in Germany for Bemsiq AB within Latour Industries was finalised on 22 January.
On 28 January, MS Group, within Latour Industries, acquired the Spanish company Batec Mobility which generates annual sales of EUR 4.8 m and has 41 employees. The company's products offer manual wheelchair users greater freedom of movement. An electric-powered add-on motor allows users to travel more quickly over longer distances, even where there are steep slopes and rough ground.
On 30 January, Hultafors Group AB acquired 80 per cent of the shares in Daan Holding B.V., which in turn owns EMMA Safety Footwear B.V. ("EMMA") based in Kerkrade, the Netherlands. Leading up to the first quarter of 2023, Hultafors Group will successively acquire 100 per cent of the shares in Daan Holding B.V. EMMA has a strong presence in central Europe with a focus on the Benelux countries. In 2019, net sales totalled EUR 23 m, with a level of profitability in line with Hultafors Group's strategic goal. The company has some 140 employees and recently set up a new, state-of-the-art facility in Kerkrade, the Netherlands, for the production of safety footwear. This acquisition is part of Hultafors Group's strategy to strengthen its position in personal protective equipment in Europe and North America. It is expected that the acquisition will further expand the company's sales and marketing capabilities in Europe and will also strengthen the supply chain with a footwear production facility and other resources.
On 11 March, Swegon acquired the UK company Waterloo Air Products, a leading manufacturer of air terminal devices. This acquisition enhances Swegon's offering, which now comprises a full range of high-quality indoor climate products. The company employs 140 people and its head office and production site is in Aylesford. In 2019, the acquired operation reported net sales of GBP 12 m.
| Net sales | Operating profit | Operating margin % | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |
| SEK m | Q2 | Q2 | 6 mths | 6 mths | Q2 | Q2 | 6 mths | 6 mths | Q2 | Q2 | 6 mths | 6 mths |
| Caljan¹ | 219 | - | 441 | - | 27 | - | 56 | - | 12,2 | - | 12,8 | - |
| Hultafors Group | 839 | 689 | 1 684 | 1 337 | 114 | 90 | 222 | 178 | 13,6 | 13,1 | 13,2 | 13,3 |
| Latour Industries | 689 | 789 | 1 501 | 1 527 | 48 | 72 | 119 | 132 | 7,0 | 9,1 | 7,9 | 8,6 |
| Nord-Lock Group | 324 | 395 | 681 | 778 | 84 | 124 | 181 | 245 | 25,8 | 31,6 | 26,6 | 31,5 |
| Swegon | 1 472 | 1 639 | 2 866 | 3 009 | 201 | 226 | 344 | 373 | 13,7 | 13,8 | 12,0 | 12,4 |
| Eliminations | -1 | -1 | -1 | -2 | - | - | - | - | - | - | - | - |
| 3 542 | 3 511 | 7 172 | 6 649 | 474 | 512 | 922 | 928 | 13,4 | 14,6 | 12,9 | 13,9 | |
| Part-owned subsidiaries | 63 | 55 | 111 | 100 | 2 | 3 | 2 | 1 | 3,5 | 4,9 | 1,7 | 1,7 |
| 3 605 | 3 566 | 7 283 | 6 749 | 476 | 515 | 924 | 929 | 13,2 | 14,4 | 12,7 | 13,6 | |
| Gain/loss from sale/purchase of | ||||||||||||
| businesses | - | - | - | - | -10 | 108 | -27 | 107 | ||||
| Other companies and items | - | 1 | - | 3 | -9 | -25 | -17 | -26 | ||||
| 3 605 | 3 567 | 7 283 | 6 752 | 457 | 598 | 880 | 1 010 | |||||
| IFRS 16 | - | - | - | - | 4 | 1 | 6 | 2 | ||||
| 3 605 | 3 567 | 7 283 | 6 752 | 461 | 599 | 886 | 1 012 |
| Operating capital ² | Return on operating capital % | Growth in net sales, 2020 % | |||||||
|---|---|---|---|---|---|---|---|---|---|
| SEK m | 2020 Trailing 12 |
2019 Trailing 12 |
2020 Trailing 12 |
2019 Trailing 12 |
Total | Organic | Currency | Acquisitions | |
| Caljan¹ | 1 611 | - | 4,7 | - | - | - | - | - | |
| Hultafors Group | 3 532 | 2 331 | 12,9 | 16,8 | 26,0 | -1,1 | 1,1 | 26,0 | |
| Latour Industries | 3 311 | 3 046 | 7,7 | 8,0 | -1,7 | -11,5 | -0,1 | 11,2 | |
| Nord-Lock Group | 1 167 | 1 077 | 29,7 | 40,8 | -12,5 | -14,1 | 1,9 | - | |
| Swegon | 3 301 | 3 215 | 20,8 | 20,3 | -4,7 | -7,2 | -0,1 | 2,7 | |
| Total | 12 922 | 9 669 | 14,1 | 17,9 | 7,9 | -7,6 | 0,5 | 16,2 |
¹ The figures for the previous year and trailing 12 months refer to the time from the acquisition date on 1 December 2019.
² Calculated as total assets less cash and other interest-bearing assets and less non-interest-bearing liabilities. Calculated on the average for the past 12 months.
| 2020 2019* | 2020 | 2019 | 2019 Trailing | |||
|---|---|---|---|---|---|---|
| (MEUR) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Net sales | 21 | 27 | 41 | 45 | 92 | 88 |
| EBITDA | 3 | 4 | 6 | 7 | 14 | 14 |
| EBITDA¹ | 3 | 4 | 6 | 7 | 14 | 13 |
| EBITA¹ | 3 | 4 | 6 | 6 | 13 | 13 |
| EBIT¹ | 3 | 4 | 5 | 6 | 13 | 12 |
| EBITA %¹ | 13.0 | 15.9 | 13.6 | 13.5 | 14.2 | 14.3 |
| EBIT %¹ | 12.5 | 15.9 | 13.1 | 13.5 | 14.2 | 14.0 |
| Total growth % | -23.3 | -8.8 | ||||
| Organic % | -23.3 | -9.1 | ||||
| Exchange effects % | 0.1 | 0.3 | ||||
| Acquisitions % | - | - | ||||
| Average number of employees | 487 | 484 | 465 | |||
| ¹ Excl. IFRS 16. |
* Pro forma
| (MEUR) | Q2 | 2020 2019* Q2 |
2020 6 mths |
2019 | 6 mths Full Year | 2019 Trailing 12 mths |
|---|---|---|---|---|---|---|
| Telescopics | 13 | 20 | 28 | 31 | 56 | 53 |
| Document Handling & Labelling | 1 | 1 | 2 | 2 | 9 | 9 |
| Depot Automation Solutions | 1 | 0 | 2 | 2 | 5 | 5 |
| Aftermarket | 5 | 6 | 10 | 10 | 22 | 21 |
| 21 | 27 | 41 | 45 | 92 | 88 |
*Pro forma
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
|---|---|---|---|---|---|---|
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Net sales | 839 | 689 | 1,684 | 1,337 | 2,896 | 3,243 |
| EBITDA | 130 | 102 | 254 | 203 | 462 | 513 |
| EBITDA¹ | 123 | 95 | 241 | 189 | 435 | 487 |
| EBITA¹ | 116 | 91 | 227 | 180 | 416 | 463 |
| EBIT¹ | 114 | 90 | 222 | 178 | 412 | 456 |
| EBITA %¹ | 13.9 | 13.2 | 13.5 | 13.4 | 14.4 | 14.3 |
| EBIT %¹ | 13.6 | 13.1 | 13.2 | 13.3 | 14.2 | 14.1 |
| Total growth % | 21.7 | 15.6 | 26.0 | 24.6 | 20.3 | |
| Organic % | -3.1 | 1.6 | -1.1 | 5.5 | 3.2 | |
| Exchange effects % | -0.1 | 2.8 | 1.1 | 3.5 | 3.2 | |
| Acquisitions % | 25.8 | 10.6 | 26.0 | 14.2 | 13.1 | |
| Average number of employees | 978 | 855 | 980 | 852 | 885 | |
| ¹ Excl. IFRS 16. |
| (SEK m) | 2020 Q2 |
2019 Q2 |
2020 6 mths |
2019 | 2019 6 mths Full Year |
Trailing 12 mths |
|---|---|---|---|---|---|---|
| PPE/Workwear | 462 | 395 | 938 | 770 | 1,660 | 1,828 |
| Hardware | 376 | 294 | 746 | 567 | 1,236 | 1,415 |
| 839 | 689 | 1,684 | 1,337 | 2,896 | 3,243 | |
| Pro forma adjustment¹ | 212 | |||||
| Trailing 12 month pro forma | 3,455 |
¹ Pro forma for completed acquisitions.
Caljan is a global supplier of automation technology for parcel handling in the logistics and e-commerce sectors. Caljan's products help packing companies, distributors and manufacturers around the world to optimise their supply chains. Flows are increased, costs are reduced and working environments are made safer and more ergonomic. Caljan has its head office in Aarhus, Denmark, and subsidiaries in the USA and several European countries.
Hultafors Group offers products in the Personal Protective Equipment/Workwear and Hardware segments. The products are marketed under brands with strong positions in their respective markets: Snickers Workwear, Dunderdon, CLC, Kuny's Leather, Solid Gear, Toe Guard, Hultafors, Wibe Ladders, Johnson Level, Hellberg Safety and EMMA. Hultafors Group is also a distributor for the German manufacturing company Fein in the Swedish market.
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
|---|---|---|---|---|---|---|
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Net sales | 689 | 789 | 1,501 | 1,527 | 3,075 | 3,050 |
| EBITDA | 76 | 99 | 175 | 186 | 379 | 368 |
| EBITDA¹ | 63 | 86 | 150 | 160 | 327 | 317 |
| EBITA¹ | 52 | 76 | 127 | 140 | 285 | 272 |
| EBIT¹ | 48 | 72 | 119 | 132 | 267 | 255 |
| EBITA %¹ | 7.6 | 9.6 | 8.5 | 9.2 | 9.3 | 8.9 |
| EBIT %¹ | 7.0 | 9.1 | 7.9 | 8.6 | 8.7 | 8.4 |
| Total growth % | -12.6 | 12.7 | -1.7 | 14.8 | 12.4 | |
| Organic % | -19.8 | 4.6 | -11.5 | 6.5 | 3.8 | |
| Exchange effects % | -1.4 | 1.5 | -0.1 | 1.9 | 1.7 | |
| Acquisitions % | 10.5 | 6.2 | 11.2 | 5.8 | 6.5 | |
| Average number of employees | 1,545 | 1,477 | 1,539 | 1,465 | 1,465 | |
| ¹ Excl. IFRS 16. |
| (SEK m) | 2020 Q2 |
2019 Q2 |
2020 6 mths |
2019 | 2019 6 mths Full Year |
Trailing 12 mths |
|---|---|---|---|---|---|---|
| Bemsiq | 173 | 122 | 370 | 247 | 497 | 620 |
| Aritco Group | 183 | 195 | 405 | 367 | 792 | 830 |
| Vimec | 84 | 135 | 185 | 246 | 541 | 480 |
| MS Group | 109 | 139 | 237 | 283 | 529 | 483 |
| LSAB | 105 | 145 | 236 | 291 | 533 | 478 |
| Densiq | 37 | 55 | 72 | 97 | 193 | 168 |
| Elimination | -2 | -3 | -3 | -4 | -10 | -9 |
| 689 | 789 | 1,501 | 1,527 | 3,075 | 3,050 | |
| Pro forma adjustment¹ | 158 | |||||
| Trailing 12 month pro forma | 3,208 |
¹ Pro forma for completed acquisitions.
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
|---|---|---|---|---|---|---|
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Net sales | 324 | 395 | 681 | 778 | 1,448 | 1,351 |
| EBITDA | 98 | 140 | 211 | 275 | 471 | 408 |
| EBITDA¹ | 92 | 134 | 199 | 263 | 446 | 382 |
| EBITA¹ | 86 | 127 | 186 | 250 | 420 | 357 |
| EBIT¹ | 84 | 124 | 181 | 245 | 411 | 347 |
| EBITA %¹ | 26.5 | 32.2 | 27.3 | 32.1 | 29.0 | 26.4 |
| EBIT %¹ | 25.8 | 31.6 | 26.6 | 31.5 | 28.4 | 25.7 |
| Total growth % | -17.8 | 15.7 | -12.5 | 20.7 | 10.7 | |
| Organic % | -18.2 | 9.3 | -14.1 | 12.7 | 4.4 | |
| Exchange effects % | 0.4 | 4.9 | 1.9 | 6.1 | 5.4 | |
| Acquisitions % | - | 0.8 | - | 0.9 | 0.5 | |
| Average number of employees | 562 | 607 | 576 | 598 | 594 | |
| ¹ Excl. IFRS 16. |
| (SEK m) | 2020 Q2 |
2019 Q2 |
2020 6 mths |
2019 | 2019 6 mths Full Year |
Trailing 12 mths |
|---|---|---|---|---|---|---|
| EMEA | 123 | 172 | 302 | 344 | 652 | 610 |
| Americas | 79 | 108 | 179 | 204 | 394 | 370 |
| Asia Pacific | 122 | 114 | 200 | 230 | 402 | 372 |
| 324 | 395 | 681 | 778 | 1,448 | 1,351 | |
| Pro forma adjustment¹ | - | |||||
| Trailing 12 month pro forma | 1,351 |
¹ Pro forma for completed acquisitions.
Nord-Lock Group is a world leader in secure bolting solutions. The Group offers a wide range of innovative technologies including Nord-Lock wedge-locking, Superbolt multi-jackbolt tensioning, Boltight hydraulic tensioning and Expander System pivot technology. With a global sales organization and international partners the customers benefit from bolting expertise and the optimum solution for any bolting challenge.
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
|---|---|---|---|---|---|---|
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Net sales | 1,472 | 1,639 | 2,866 | 3,009 | 5,986 | 5,844 |
| EBITDA | 241 | 265 | 420 | 451 | 873 | 842 |
| EBITDA¹ | 223 | 248 | 387 | 417 | 804 | 774 |
| EBITA¹ | 205 | 230 | 352 | 381 | 733 | 704 |
| EBIT¹ | 201 | 226 | 344 | 373 | 717 | 688 |
| EBITA %¹ | 13.9 | 14.0 | 12.3 | 12.7 | 12.2 | 12.0 |
| EBIT %¹ | 13.7 | 13.8 | 12.0 | 12.4 | 12.0 | 11.8 |
| Total growth % | -10.2 | 21.7 | -4.7 | 21.9 | 16.5 | |
| Organic % | -11.9 | 12.4 | -7.2 | 12.6 | 8.0 | |
| Exchange effects % | -1.4 | 2.3 | -0.1 | 2.8 | 2.5 | |
| Acquisitions % | 3.4 | 5.8 | 2.7 | 5.3 | 5.3 | |
| Average number of employees | 2,634 | 2,514 | 2,614 | 2,471 | 2,454 | |
| ¹ Excl. IFRS 16. |
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
|---|---|---|---|---|---|---|
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Sweden | 328 | 332 | 634 | 632 | 1,188 | 1,190 |
| Rest of Nordic region | 292 | 278 | 566 | 535 | 1,046 | 1,077 |
| Rest of world | 852 | 1,029 | 1,666 | 1,842 | 3,752 | 3,577 |
| 1,472 | 1,639 | 2,866 | 3,009 | 5,986 | 5,844 | |
| Pro forma adjustment¹ | 105 | |||||
| Trailing 12 month pro forma | 5,949 | |||||
| ¹ Pro forma for completed acquisitions. | ||||||
| 2020 | 2019 | 2020 | 2019 | 2019 | Trailing | |
| (SEK m) | Q2 | Q2 | 6 mths | 6 mths Full Year | 12 mths | |
| Commercial Ventilation | 1,147 | 1,320 | 2,221 | 2,405 | 4,778 | 4,595 |
| Residential | 141 | 132 | 276 | 243 | 476 | 509 |
| North America | 82 | 88 | 158 | 169 | 342 | 331 |
| UK | 153 | 180 | 328 | 335 | 662 | 655 |
| Eliminations | -51 | -81 | -117 | -143 | -272 | -246 |
| 1,472 | 1,639 | 2,866 | 3,009 | 5,986 | 5,844 |
Swegon provides components and innovative system solutions that create a good indoor climate and contribute to significant energy savings in all types of buildings. Swegon's products constitute a turnkey solution for the perfect indoor climate.
In order to facilitate the evaluation of Latour's net asset value, Latour provides an estimated range of the value (Enterprise Value) for each business area based on EBIT multiples. These multiples have been calculated by comparing valuations of listed companies in comparable industries. Since there are variations in the listed companies' valuations, this is reflected in the table by valuing each business area in a range. Deductions are then made for the Group's net debt. The evaluation of comparable companies is based on the share price on the balance sheet date. Any price changes after the balance sheet date have therefore not been taken into consideration. A more detailed description can be found on page 25 of Latour's Annual Report for 2019.
In some cases, the valuation multiples for comparable companies span over a very big range. For this reason, the multiples may be adjusted in order to avoid unreasonable values. The indicative value stated below is not a complete market valuation of Latour's holdings.
During the period, the net asset value declined from SEK 136 per share at the start of the year to SEK 127. The net asset value thus decreased by 5.5 per cent, while the SIXRX benchmark index decreased by 4.1 per cent. The valuation multiples for Hultafors Group and Swegon, which were adjusted downward after the first quarter 2020, have been adjusted back to their previous range due to the recovery in market value for companies in related industries for these business areas during the second quarter.
| SEK m | Net sales¹ | EBIT¹ | EBIT multiple | Valuation² Range |
Valuation² Average |
Valuation² SEK/share³ Range |
||
|---|---|---|---|---|---|---|---|---|
| Caljan | 941 | 130 | 15 19 |
1,952 2,472 |
2,212 | 3 | 4 | |
| Hultafors Group | 3,455 | 486 | 11 15 |
5,351 7,297 |
6,324 | 8 | 11 | |
| Latour Industries | 3,208 | 297 | 12 16 |
3,569 4,758 |
4,163 | 6 | 7 | |
| Nord-Lock Group | 1,351 | 347 | 12 16 |
4,161 5,548 |
4,855 | 7 | 9 | |
| Swegon | 5,949 | 695 | 13 17 |
9,034 11,814 |
10,424 | 14 | 19 | |
| 14,904 | 1,956 | 24,067 31,890 |
38 | 50 | ||||
| Industrial operations valuation, average | 27,978 | 44 | ||||||
| Listed shares (see table on page 10 for breakdown) | 59,624 | 93 | ||||||
| Unlisted part-owned holdings | ||||||||
| Neuffer⁴, 66.1 % | 149 | 0 | ||||||
| Oxeon⁴, 31.6 % | 18 | 0 | ||||||
| Other assets | 0 | 0 | ||||||
| Short trading portfolio | 0 | 0 | ||||||
| Dilution effect of option programme | -84 | 0 | ||||||
| Consolidated net debt (excl IFRS 16) | -6,267 | -10 | ||||||
| Estimated value | 81,418 | 127 | ||||||
| (77 507 85 330) |
(121 | 134) |
¹ Trailing 12 months for current company structure (proforma). EBIT is, as appropriate, reported before restructuring costs.
² EBIT and EV/sales recalculated taking into consideration the listed share price on 30 of June 2020 for comparable companies in each business area.
³ Calculated on the basis of the number of outstanding shares.
⁴ Valued according to the book value.
INTERIM REPORT JANUARY JUNE 2020 9
In the first six months, the value of the investment portfolio decreased by 4.7 per cent, adjusted for changes in the portfolio and dividends, while the benchmark index (SIXRX) decreased by 4.1 per cent.
In May, 7.8 million shares in Tomra were sold. Latour remains as principal owner with 21.1 per cent of the shares. During the six-month period, the shareholding in Fagerhult increased to 47.2 per cent following the acquisition of 1,590,000 shares. The shareholding in Alimak increased to 29.6 per cent following the acquisition of 210,000 shares.
| Cost | Listed share price ² | Market value | Share of votes | Share of equity | ||
|---|---|---|---|---|---|---|
| Share ¹ | Number | SEK m | SEK | SEK m | % | % |
| Alimak Group | 16,016,809 | 2,134 | 101 | 1,614 | 29.7 | 29.6 |
| Assa Abloy ³ | 105,495,729 | 1,697 | 190 | 19,991 | 29.5 | 9.5 |
| Fagerhult | 83,708,480 | 1,854 | 35 | 2,888 | 47.5 | 47.2 |
| HMS Networks | 12,109,288 | 250 | 174 | 2,105 | 25.9 | 25.9 |
| Nederman | 10,538,487 | 306 | 111 | 1,170 | 30.0 | 30.0 |
| Securitas ³ | 39,732,600 | 1,081 | 126 | 4,990 | 29.6 | 10.9 |
| Sweco ³ ⁴ | 32,622,480 | 445 | 418 | 13,649 | 21.3 | 26.9 |
| Tomra ⁵ | 31,200,000 | 1,600 | 353 NOK | 10,576 | 21.1 | 21.1 |
| Troax | 18,060,000 | 397 | 146 | 2,640 | 30.1 | 30.1 |
| Total | 9,764 | 59,624 |
¹ All holdings are reported as associated companies in the balance sheet.
² The last price paid is used as the listed share price.
as the companies' class B shares. Holdings consisting of both class A and B shares are reported in the table as unit. ³ Due to the limited trading in class A shares in Sweco, and the fact that the class A shares in Assa Abloy and Securitas are unlisted, they have been given the same listed share price
⁴ The cost of the class B shares are SEK 34 m higher than in the parent company through the exercise of call options.
⁵ At the end of the report period, the listed share price was NOK 353,10 which has been translated to SEK at the exchange rate on the balance sheet date.
Movements in investment portfolio values (SEK billion). These figures include acquired and divested shares but not dividends.
The Group's profit after financial items was SEK 2,925 m (3,575 m). Profit after tax was SEK 2,746 m (3,372 m), which is equivalent to SEK 4.29 (5.27) per share. A write-down of the holding in Alimak negatively impacted the income statement by SEK -617 m, and capital gains had a positive impact of SEK 1,976 m. The business areas have received offered state support in those cases where it is justified, but to a relatively small extent. In total, we have received SEK 50 m, of which SEK 10 m in Sweden.
The Group's cash in hand and liquid investments reached SEK 4,673 m (734 m). Interest-bearing debt, excluding pension liabilities and lease liabilities, totalled SEK 10,862 m (4,522 m). The Group's net debt was SEK 6,843 m (5,279 m). Net debt, excluding lease liabilities, was SEK 6,267 m (4,613 m). The equity ratio was 82 (88) per cent calculated on reported equity in relation to total assets, including undisclosed surpluses in associated companies.
In the first quarter, Latour updated the base prospectus for its existing MTN programme and, at the same time, increased the framework amount to SEK 10 billion at the Swedish Financial Supervisory Authority. In March, Latour issued two new bonds with a total value of SEK 2.5 billion. All in all, Latour has seven outstanding bonds with a total value of SEK 7 billion.
There have been no transactions with related parties that have had a material effect on the results or financial position of the Group.
During the period, SEK 282 m (55 m) was invested in property, plant and equipment, of which SEK 128 m (42 m) was machinery and equipment, SEK 12 m (10 m) was vehicles, and SEK 142 m (3 m) was buildings. Fixed assets in newly acquired companies account for SEK 129 m (4 m) of investments for the year.
The parent company's profit after financial items was SEK 2,875 m (1,385 m). The parent company's equity ratio was 63 (70) per cent.
The number of class A shares issued is 47,641,048 and the number of class B shares is 592,198,952. Not including repurchased shares, the number of outstanding shares on 30 June 2020 amounted to 639,379,500. At the end of the period, Latour holds 460,500 repurchased class B shares.
The total number of issued call options is 1,668,500, which give the right to purchase the same amount of shares.
There were no material events subsequent to the end of the reporting period.
The main risk to which the Group and the parent company are exposed is the risk attributable to adverse changes in the values of financial instruments, including a general decline in the stock market or in the value of an individual holding. This includes uncertainties relating to changes in exchange rates and interest rates. Latour has a well-diversified holding of shares, spread across nine listed holdings and five whollyowned business areas. This means that the development and performance of an individual holding will not have a drastic impact on the portfolio as a whole. As the wholly-owned industrial operations have increased in size, Latour is generally influenced to a higher degree by changes attributable to these operations. On the whole, Latour is deemed to have a good risk diversification in its portfolio, which covers several industries, with a certain emphasis on sectors linked to the construction industry. Construction can also be divided into several dimensions, such as new builds or government-subsidised repair, conversion or extension work, locally or globally, and housing, office and industrial premises or infrastructure projects. No material risks are deemed to have arisen other than those described in Note 35 of Latour's 2019 Annual Report, except any possible effects of the Corona pandemic that are commented on in other parts of this report.
This interim report has been prepared in accordance with the Swedish Annual Accounts Act and IAS 34 Interim Reporting in respect of the Group, and in accordance with the Annual Accounts Act and Recommendation RFR 2 Accounting for Legal Entities of the Swedish Financial Reporting Board in respect of the parent company.
New accounting standard requirements that came into effect on 1 January 2020 have not had any impact on the Group's or parent company's accounting as of 30 June 2020.
The Latour Group uses a number of economic indicators that are not defined in the set of accounting rules used by the Group, so-called alternative performance measures. Definitions of the economic indicators can be found on page 20 of this report and in Latour's latest Annual Report. For an explanation of how the financial performance measures have been calculated for the current and prior periods, please see the table in this report and Latour's latest Annual Report.
The Annual Reports for 1986 to 2019 are available for viewing on Latour's website www.latour.se.
This report has not been formally audited by the company's auditors.
Gothenburg, 20 August 2020 Johan Hjertonsson President and CEO
The Board of Directors and the Chief Executive Officer declare that the statements for the six-month period give a true and fair view of the company's and the Group's operations, financial positions and performance, and describe the principal risks and uncertainties faced by the company and the Group's companies.
Gothenburg, 20 August 2020 Investment AB Latour
Mariana Burenstam Linder Board member
Olle Nordström Chairman
Anders Böös Board member
Carl Douglas Board member
Johan Hjertonsson Board member and Chief Executive Officer
Eric Douglas Board member
Lena Olving Board member Joakim Rosengren Board member
| 2020 | 2019 | 2020 | 2019 | 12 mths Jul-Jun | Full Year | |
|---|---|---|---|---|---|---|
| SEK m | Q2 | Q2 | 6 mths | 6 mths | 2019/2020 | 2019 |
| Net sales | 3,605 | 3,567 | 7,283 | 6,752 | 14,269 | 13,738 |
| Cost of goods sold | -2,209 | -2,137 | -4,443 | -4,041 | -8,703 | -8,301 |
| Gross profit | 1,396 | 1,430 | 2,840 | 2,711 | 5,566 | 5,437 |
| Sales costs | -545 | -575 | -1,152 | -1,122 | -2,299 | -2,269 |
| Administrative costs | -305 | -277 | -615 | -534 | -1,159 | -1,078 |
| Research and development costs | -102 | -87 | -205 | -171 | -363 | -329 |
| Other operating income | 45 | 115 | 70 | 141 | 113 | 184 |
| Other operating expenses | -28 | -7 | -52 | -13 | -165 | -126 |
| Operating profit | 461 | 599 | 886 | 1,012 | 1,693 | 1,819 |
| Income from interests in associates | 2,475 | 1,196 | 2,134 | 2,568 | 3,337 | 3,771 |
| Income from portfolio management | - | -23 | -7 | -12 | 223 | 218 |
| Management costs | -6 | 36 | -13 | 30 | -67 | -24 |
| Profit before financial items | 2,930 | 1,808 | 3,000 | 3,598 | 5,186 | 5,784 |
| Finance income | -95 | 30 | 14 | 98 | -46 | 38 |
| Finance expense | -26 | -54 | -89 | -121 | -65 | -97 |
| Profit after financial items | 2,809 | 1,784 | 2,925 | 3,575 | 5,075 | 5,725 |
| Taxes | -67 | -113 | -179 | -203 | -391 | -415 |
| Profit for the period | 2,742 | 1,671 | 2,746 | 3,372 | 4,684 | 5,310 |
| Attributable to: | ||||||
| Parent company shareholders | 2,741 | 1,670 | 2,745 | 3,371 | 4,701 | 5,327 |
| Non-controlling interests | 1 | 1 | 1 | 1 | -17 | -17 |
| Earnings per share regarding profit attributable to parent company | ||||||
| shareholders | ||||||
| Basic share, SEK | 4.29 | 2.61 | 4.29 | 5.27 | 7.35 | 8.33 |
| Diluted share, SEK | 4.27 | 2.60 | 4.28 | 5.26 | 7.33 | 8.31 |
| Average number of basic shares outstanding | 639,313,412 | 639,170,082 | 639,297,956 | 639,143,936 | 639,290,186 | 639,213,788 |
| Average number of diluted shares outstanding | 641,432,945 | 641,325,511 | 641,522,973 | 641,394,124 | 641,421,811 | 641,357,640 |
| Number of outstanding shares | 639,379,500 | 639,282,500 | 639,379,500 | 639,282,500 | 639,379,500 | 639,282,500 |
| 2020 | 2019 | 2020 | 2019 | 12 mths Jul-Jun | Full Year | |
|---|---|---|---|---|---|---|
| SEK m | Q2 | Q2 | 6 mths | 6 mths | 2019/2020 | 2019 |
| Profit for the period | 2,742 | 1,671 | 2,746 | 3,372 | 4,684 | 5,310 |
| Other comprehensive income: | ||||||
| Items that will not be recycled to the income statement | ||||||
| Restatement of net pension obligations | - | - | - | - | -15 | -15 |
| 0 | 0 | 0 | 0 | -15 | -15 | |
| Items that may subsequently be recycled to the income statement | ||||||
| Change in translation reserve for the period | -580 | 54 | -32 | 163 | -118 | 77 |
| Change in fair value reserve for the period | - | -2 | - | 23 | -157 | -134 |
| Change in hedging reserve for the period | 161 | 2 | -10 | -1 | 60 | 69 |
| Change in associated companies' equity | 586 | 176 | 6 | 272 | 262 | 528 |
| 167 | -36 | 457 | 47 | 540 | ||
| Other comprehensive income, net after tax | 167 | 230 | -36 | 457 | 32 | 525 |
| Comprehensive income for the period | 2,909 | 1,901 | 2,710 | 3,829 | 4,716 | 5,835 |
| Attributable to: | ||||||
| Parent company shareholders | 2,908 | 1,900 | 2,709 | 3,828 | 4,731 | 5,850 |
| Non-controlling interests | 1 | 1 | 1 | 1 | -15 | -15 |
| 2020 | 2019 | 2020 | 2019 | 12 mths Jul-Jun | Full Year | |
|---|---|---|---|---|---|---|
| SEK m | Q2 | Q2 | 6 mths | 6 mths | 2019/2020 | 2019 |
| Operating cash flows before movements in working capital | 529 | 518 | 904 | 940 | 1,828 | 1,864 |
| Movements in working capital | 190 | -70 | -92 | -293 | 144 | -57 |
| Operating cash flows | 719 | 448 | 812 | 647 | 1,972 | 1,807 |
| Acquisitions of subsidaries | -41 | - | -797 | -62 | -4,587 | -3,852 |
| Other investments | -94 | -59 | -182 | -89 | -321 | -228 |
| Portfolio management | 2,798 | 328 | 2,734 | 1,430 | 2,676 | 1,372 |
| Cash flow after investments | 3,382 | 717 | 2,567 | 1,926 | -260 | -901 |
| Financial payments | -1,329 | -1,888 | 1,092 | -1,968 | 4,210 | 1,150 |
| Cash flow for the period | 2,053 | -1,171 | 3,659 | -42 | 3,950 | 249 |
| SEK m | 2020/06/30 | 2019/06/30 | 2019/12/31 |
|---|---|---|---|
| ASSETS | |||
| Goodwill | 10,704 | 6,757 | 9,913 |
| Other intangible assets | 260 | 214 | 272 |
| Property, plant and equipment¹ | 1,903 | 1,628 | 1,669 |
| Financial assets | 19,879 | 19,027 | 20,466 |
| Inventories etc. | 2,378 | 1,940 | 2,111 |
| Current receivables | 3,439 | 2,952 | 3,142 |
| Cash and bank | 4,673 | 734 | 1,029 |
| Total assets | 43,236 | 33,252 | 38,602 |
| EQUITY AND LIABILITIES | |||
| Capital and reserves attributable to parent company shareholders | 27,886 | 23,977 | 26,010 |
| Non-controlling interests | 80 | 98 | 80 |
| Total equity | 27,966 | 24,075 | 26,090 |
| Inerest-bearing long-term liabilities | 9,100 | 5,157 | 7,977 |
| Non-interest-bearing long-term liabilities | 526 | 432 | 517 |
| Interest-bearing current liabilities | 2,435 | 889 | 1,195 |
| Non-interest-bearing current liabilities | 3,209 | 2,699 | 2,823 |
| Equity and liabilities | 43,236 | 33,252 | 38,602 |
| Share | Repurchased | Other | Profit brought | Non-controlling | ||
|---|---|---|---|---|---|---|
| SEK m | capital | treasury shares | reserves | forward | interests | Total |
| Opening balance 1 Jan 2019 | 133 | -60 | 432 | 21,263 | 95 | 21,863 |
| Total comprehensive income for the period | 10 | 5,840 | -15 | 5,835 | ||
| Issued call options | 8 | 8 | ||||
| Exercise of call options | 49 | -11 | 38 | |||
| Own shares repurchase | -56 | -56 | ||||
| Dividends | -1,598 | -1,598 | ||||
| Closing balance 31 December 2019 | 133 | -67 | 442 | 25,502 | 80 | 26,090 |
| Opening balance 1 Jan 2020 | 133 | -67 | 442 | 25,502 | 80 | 26,090 |
| Total comprehensive income for the period | -43 | 2,752 | - | 2,709 | ||
| Exercise of call options | 79 | -18 | 61 | |||
| Own shares repurchase | -95 | -95 | ||||
| Dividends | -799 | -799 | ||||
| Closing balance 30 June 2020 | 133 | -83 | 399 | 27,437 | 80 | 27,966 |
| 2020/06/30 | 2019/06/30 | 2019/12/31 | |
|---|---|---|---|
| Return on equity (%) | 20 | 29 | 22 |
| Return on total capital (%) | 15 | 23 | 15 |
| Equity ratio, incl IFRS 16 (%) | 65 | 72 | 68 |
| Equity ratio, excl IFRS 16 (%) | 66 | 74 | 69 |
| Adjusted equity ratio, incl IFRS 16 ¹ (%) | 82 | 88 | 85 |
| Adjusted equity ratio, excl IFRS 16 ¹ (%) | 82 | 89 | 86 |
| Adjusted equity ¹ (SEK m) | 67,933 | 66,481 | 71,398 |
| Surplus value in associated companies² (SEK m) | 39,967 | 42,406 | 45,308 |
| Net debt/equity ratio 1 (%) ³ | 10.1 | 7.9 | 11.3 |
| Net debt/equity ratio 2 (%) ⁴ | 7.8 | 6.1 | 9.4 |
| Listed share price (SEK) | 169 | 137 | 153 |
| Repurchased shares | 460,500 | 557,500 | 557,500 |
| Average number of repurchased shares | 542,044 | 696,064 | 626,212 |
| Average number of employees | 6,253 | 5,376 | 5,882 |
| Issued call options corresponds to number of shares | 1,668,500 | 1,748,000 | 2,330,500 |
¹ Incl. fair value gain in associated companies.
² The difference between the carrying amount and market value.
³ The ratio of net debt to adjusted equity.
⁴ The ratio of net debt to the market vaule of total assets.
| SEK m | 2020 Q2 |
2019 Q2 |
2020 6 mths |
2019 6 mths |
12 mths Jul-Jun 2019/2020 |
Full Year 2019 |
|---|---|---|---|---|---|---|
| Income from interests i Group companies | 440 | 440 | 440 | 440 | 440 | 440 |
| Income from interest in associates companies | 2,440 | 953 | 2,440 | 953 | 2,440 | 953 |
| Income from portfolio management | - | - | - | - | - | - |
| Management costs | -5 | -4 | -10 | -8 | -21 | -19 |
| Profit before financial items | 2,875 | 1,389 | 2,870 | 1,385 | 2,859 | 1,374 |
| Interest income and similar items | 20 | 4 | 36 | 7 | 50 | 21 |
| Interest expense and similar items | 69 | -4 | -31 | -7 | -43 | -19 |
| Profit after financial items | 2,964 | 1,389 | 2,875 | 1,385 | 2,866 | 1,376 |
| Taxes | - | - | - | - | - | - |
| Profit for the period | 2,964 | 1,389 | 2,875 | 1,385 | 2,866 | 1,376 |
| SEK m | 2020 Q2 |
2019 Q2 |
2020 6 mths |
2019 6 mths |
12 mths Jul-Jun 2019/2020 |
Full Year 2019 |
|---|---|---|---|---|---|---|
| Profit for the period | 2,964 | 1,389 | 2,875 | 1,385 | 2,866 | 1,376 |
| Change in fair value reserve for the period | - | - | - | - | - | - |
| Total other comprehensive income | 0 | 0 | 0 | 0 | 0 | 0 |
| Comprehensive income for the period | 2,964 | 1,389 | 2,875 | 1,385 | 2,866 | 1,376 |
| SEK m | 2020/06/30 | 2019/06/30 | 2019/12/31 |
|---|---|---|---|
| ASSETS | |||
| Financial assets | 10,840 | 10,936 | 11,157 |
| Long-term receivables from Group companies | 6,250 | 3,100 | 6,000 |
| Current receivables from Group companies | 1,781 | - | - |
| Other current liabilities | 24 | 9 | 13 |
| Cash and bank | 12 | - | - |
| Total assets | 18,907 | 14,045 | 17,170 |
| EQUITY AND LIABILITIES | |||
| Equity | 11,891 | 9,850 | 9,849 |
| Interese-bearing long-term lilabilities | 7,000 | 3,100 | 6,000 |
| Non-interest-bearing long-term liabilities | - | - | - |
| Interese-bearing current liabilities | - | 1,089 | 1,307 |
| Non-interest-bearing current liabilities | 16 | 6 | 14 |
| Equity and liabilities | 18,907 | 14,045 | 17,170 |
| SEK m | 2020/06/30 | 2019/06/30 | 2019/12/31 |
|---|---|---|---|
| Amount at beginning of year | 9,849 | 10,081 | 10,081 |
| Total comprehensive income for the period | 2,875 | 1,385 | 1,376 |
| Issued call options | - | - | 8 |
| Exercise of call options | -18 | 39 | 39 |
| Repurchased treasury shares | -16 | -57 | -57 |
| Dividends | -799 | -1,598 | -1,598 |
| Amount at end of year | 11,891 | 9,850 | 9,849 |
| Industrial operations | ||||||||
|---|---|---|---|---|---|---|---|---|
| Hultafors | Latour | Nord-Lock | Portfolio | |||||
| SEK m | Caljan | Group | Industries | Group | Swegon | Other | management | Total |
| INCOME | ||||||||
| External sales | 441 | 1,684 | 1,500 | 681 | 2,866 | 111 | 7,283 | |
| Internal sales | 1 | 1 | ||||||
| RESULT | ||||||||
| Operating profit | 56 | 222 | 119 | 181 | 344 | -36 | 886 | |
| Income from portfolio management | 2,114 | 2,114 | ||||||
| Finance income | 14 | |||||||
| Finance expense | -89 | |||||||
| Taxes | -179 | |||||||
| Profit for the period | 2,746 | |||||||
| OTHER DISCLOSURES | ||||||||
| Investments in: | ||||||||
| property, plant and equipment | 98 | 108 | 33 | 4 | 27 | 12 | 282 | |
| intangible assets | - | 304 | 502 | 1 | 67 | - | 874 | |
| Depreciation/amortisation | 7 | 19 | 30 | 17 | 43 | 94 | 210 |
| Industrial operations | ||||||||
|---|---|---|---|---|---|---|---|---|
| Hultafors | Latour | Nord-Lock | Portfolio | |||||
| SEK m | Caljan | Group | Industries | Group | Swegon | Other | management | Total |
| INCOME | ||||||||
| External sales | - | 1,337 | 1,526 | 778 | 3,009 | 102 | 6,752 | |
| Internal sales | 1 | 1 | ||||||
| RESULTS | ||||||||
| Operating result | - | 178 | 132 | 245 | 373 | 84 | 1,012 | |
| Income from portfolio management | 2,586 | 2,586 | ||||||
| Finance income | 98 | |||||||
| Finance expense | -121 | |||||||
| Taxes | -203 | |||||||
| Profit for the period | 3,372 | |||||||
| OTHER DISCLOSURES | ||||||||
| Investments in: | ||||||||
| property, plant and equipment | - | 7 | 16 | 11 | 11 | 10 | 55 | |
| intangible assets | - | - | 53 | 1 | 14 | 68 | ||
| Depreciation/amortisation | - | 11 | 28 | 17 | 45 | 11 | 112 |
| SEK m | 2019/12/31 | Change in cash | Change in loans | Other changes | 2020/06/30 |
|---|---|---|---|---|---|
| Interest-bearing receivables | 48 | -29 | 19 | ||
| Cash | 1,029 | 3,601 | 43 | 4,673 | |
| Pensions provisions | -122 | 25 | -97 | ||
| Long-term liabilities | -7,855 | -980 | -168 | -9,003 | |
| Utilised bank overdraft facilities | -160 | 39 | -121 | ||
| Interest-bearing current liabilities | -1,035 | -1,279 | -2,314 | ||
| Interest-bearing net debt | -8,095 | 3,601 | -2,220 | -129 | -6,843 |
| SEK m | Jul-Jun 2019/2020 | 2019 | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|
| Net sales, SEK m | 14,269 | 13,738 | 11,785 | 9,930 | 8,344 |
| Operating profit, SEK m | 1,693 | 1,819 | 1,397 | 1,125 | 1,021 |
| Income from interest in associated companies, SEK m | 3,337 | 3,955 | 1,278 | 2,006 | 2,676 |
| Income from portfolio management, SEK m | 156 | 194 | 2 | -8 | 101 |
| Profit after finance items, SEK m | 5,075 | 5,725 | 2,646 | 3,069 | 3,754 |
| Earnings per share, SEK ¹ | 7 | 8 | 4 | 4 | 6 |
| Return on equity, % | 18 | 22 | 11 | 14 | 21 |
| Return on total capital, % | 13 | 17 | 9 | 13 | 17 |
| Adjusted equity ratio, % | 82 | 86 | 86 | 88 | 91 |
| Net debt/equity ratio, % | 10 | 11 | 9 | 8 | 3 |
| Listed share price, SEK ¹ | 169 | 153 | 112 | 101 | 86 |
¹ Comparative years recalculated with regard to the 4:1 share split carried out in June 2017.
| Transfer date | Country | Business area | Number of employees | |
|---|---|---|---|---|
| 22 January 2020 | S+S Regeltechnik GmbH | Germany | Latour Industries | 65 |
| 28 January 2020 | Batec Mobility, S.L. | Spain | Swegon | 41 |
| 30 January 2020 | Emma Safety Footwear B.V. | Netherlands | Latour Industries | 140 |
| 11 March 2020 | Waterloo Air Products | UK | Hultafors Group | 140 |
| Consolidated carrying amount | |
|---|---|
| Intangible assets | 36 |
| Property, plant and equipment | 122 |
| Inventories | 107 |
| Account receivable | 97 |
| Other receivable | 24 |
| Cash | 43 |
| Long-term liabilities | -168 |
| Current liabilities | -136 |
| Net indentifiable assets and liabilities | 170 |
| Group goodwill | 879 |
| Total purchase price | 1,049 |
| Additional purchase price | -166 |
| Cash settlement purchase price | 883 |
| Acquisition of non-cash items | -43 |
| Acquired cash | -43 |
| Effect of Group cash | 797 |
During the first quarter of 2020, Latour acquired the entire shareholdings in S+S Regeltechnik GmbH, Batec Mobility SL, Emma Safety Footwear BV and Waterloo Air Products. The acquisition calculations are preliminary and may change if new information emerges.
S+S has contributed SEK 94 m in income and SEK 25 m in operating profit during the period. Batec has contributed SEK 16 m in income and SEK -1 m in operating profit during the period. Emma has contributed SEK 81 m in income and SEK 2 m in operating profit during the period. Waterloo has contributed SEK 38 m in income and SEK 2 m in operating profit during the period. The acquisition has been made with the aim of strengthening and developing the Latour Group's existing operations. Transaction costs for acquisitions made during the period amount to SEK 20 m.
THE GROUP 30 June 2020
| Financial assets | Derivatives | |||
|---|---|---|---|---|
| Available-for-sales | values at fair value | used for | Total carrying | |
| financial assets | via profit and loss | hedging purposes | amount | |
| FINANCIAL ASSETS | ||||
| Listed shares, management | 0¹ | 0 | ||
| Other long-term securities holdings | 3² | 3 | ||
| Other long-term receivables | 23³ | 23 | ||
| Listed shares, trading | 0¹ | 0 | ||
| Unrealised gains, currency derivatives | 62² | 62 | ||
| Other current receivables | 2 977³ | 2,977 | ||
| Cash | 4 673³ | 4,673 | ||
| Total | 65 | 0 | 7,673 | 7,738 |
| FINANCIAL LIABILITIES | ||||
| Long-term loans | 8 585³ | 8,585 | ||
| Bank overdraft facilities | 121³ | 121 | ||
| Current loans | 2 157³ | 2,157 | ||
| Other liabilities | 1 911³ | 1,911 | ||
| Unrealised gains, currency derivatives | 0² | 0 | ||
| Total | 0 | 0 | 12,774 | 12,774 |
¹ Level 1 valued at fair value based on quoted prices on an active market for identical assets.
² Level 2 valued at fair value based on other observable inputs for assets and liabilities than quoted price included in level 1.
³ Level 3 valued at fair value based on inputs for assets and liabilities unobservable to the market.
The basis of fair value for listed financial assets is the quoted market price at the balance sheet date. The basis of fair value for unlisted financial assets is determined using valuation techniques, such as recent transactions, the price of comparable instruments or discounted cash flows.
Hedging instruments consist of forward exchange contracts and interest rate and currency swaps and are included in level 2. Valuation at fair value of forward exchange contracts is based on levels established by the bank on an active market.
The fair value of accounts receivable and other receivables, current receivables, cash and other liquid funds, accounts payable and other liabilities as well as long-term liabilities are estimated to have the same value as their carrying amount. Market interest is not believed to materially deviate from the discount rate for interest-bearing long-term liabilities and therefore the carrying amount is considered in essence equal to the fair value.
The Group's valuation process is carried out by the Group finance and treasury department where a team works with valuation of the financial assets and liabilities held by the Group.
Revenue by category THE GROUP 30 June 2020
| 2020 | 2019 | 2019 | |
|---|---|---|---|
| SEK m | Q2 | Q2 | Full Year |
| Renenue from goods | 6,895 | 6,017 | 12,287 |
| Renenue from services | 388 | 735 | 1,451 |
| 7,283 | 6,752 | 13,738 | |
| Fix-price contract | 5,590 | 4,902 | 10,286 |
| Time-and-materials contracts | 1,693 | 1,850 | 3,452 |
| 7,283 | 6,752 | 13,738 | |
| Sold directly to consumers | 3,763 | 3,880 | 7,248 |
| Sold through intermediaries | 3,520 | 2,872 | 6,490 |
| 7,283 | 6,752 | 13,738 |
Latour's revenues are derived from a variety of operations that are conducted in about a hundred subsidiaries.
| 2020 | 2019 | 2018 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEK m | Q2 | Q1 | Full Year | Q4 | Q3 | Q2 | Q1 | Full Year | Q4 | Q3 | Q2 | Q1 |
| INCOME STATEMENT | ||||||||||||
| Net sales | 3,605 | 3,678 | 13,738 | 3,647 | 3,339 | 3,567 | 3,185 | 11,785 | 3,268 | 2,903 | 3,024 | 2,590 |
| Cost of goods sold | -2,209 | -2,234 | -8,301 | -2,219 | -2,041 | -2,137 | -1,904 | -7,073 | -1,984 | -1,743 | -1,802 | -1,544 |
| Gross profit | 1,396 | 1,444 | 5,437 | 1,428 | 1,298 | 1,430 | 1,281 | 4,712 | 1,284 | 1,160 | 1,222 | 1,046 |
| Costs etc. for the operation | -935 | -1,019 | -3,618 | -1,064 | -855 | -831 | -868 | -3,315 | -899 | -786 | -851 | -779 |
| Operating profit | 461 | 425 | 1,819 | 364 | 443 | 599 | 413 | 1,397 | 385 | 374 | 371 | 267 |
| Total portfolio management | 2,469 | -355 | 3,965 | 1,029 | 350 | 1,209 | 1,377 | 1,280 | 321 | 473 | 106 | 380 |
| Profit before financial items | 2,930 | 70 | 5,784 | 1,393 | 793 | 1,808 | 1,790 | 2,677 | 706 | 847 | 477 | 647 |
| Net financial items | -121 | 46 | -59 | -67 | 31 | -24 | 1 | -31 | -12 | -14 | -14 | 9 |
| Profit after financial items | 2,809 | 116 | 5,725 | 1,326 | 824 | 1,784 | 1,791 | 2,646 | 694 | 833 | 463 | 656 |
| Taxes | -67 | -112 | -415 | -79 | -133 | -113 | -90 | -322 | -67 | -90 | -95 | -70 |
| Profit for the period | 2,742 | 4 | 5,310 | 1,247 | 691 | 1,671 | 1,701 | 2,324 | 627 | 743 | 368 | 586 |
| KEY RATIOS | ||||||||||||
| Earnings per share, SEK | 4.29 | 0.01 | 8.33 | 1.98 | 1.08 | 2.61 | 2.66 | 3.66 | 1.00 | 1.16 | 0.58 | 0.92 |
| Cash flow for the period | 2053 | 1606 | 249 | 169 | 122 | -1171 | 1129 | 67 | 73 | 22 | 25 | -53 |
| Adjusted equity ratio, % | 82 | 80 | 86 | 86 | 87 | 88 | 87 | 86 | 86 | 87 | 87 | 88 |
| Adjusted equity | 67,933 | 59,626 | 71,398 | 71,398 | 65,229 | 66,481 | 62,720 | 52,395 | 52,395 | 58,490 | 56,880 | 54,105 |
| Net asset value | 81,418 | 72,863 | 86,974 | 86,974 | 81,027 | 81,276 | 76,054 | 63,980 | 63,980 | 69,105 | 66,841 | 63,016 |
| Net asset value per share, SEK | 127 | 114 | 136 | 136 | 127 | 127 | 119 | 100 | 100 | 108 | 105 | 99 |
| Listed share price, SEK | 169 | 142 | 153 | 153 | 130 | 137 | 125 | 112 | 112 | 111 | 97 | 95 |
| NET SALES | ||||||||||||
| Caljan | 219 | 222 | 113 | 113 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Hultafors Group | 839 | 846 | 2,896 | 866 | 693 | 689 | 648 | 2,407 | 716 | 618 | 596 | 477 |
| Latour Industries | 689 | 812 | 3,079 | 810 | 739 | 790 | 740 | 2,758 | 747 | 660 | 700 | 652 |
| Nord-Lock Group | 324 | 357 | 1,448 | 330 | 340 | 395 | 384 | 1,309 | 333 | 332 | 341 | 303 |
| Swegon | 1,472 | 1,394 | 5,986 | 1,473 | 1,505 | 1,639 | 1,370 | 5,137 | 1,421 | 1,248 | 1,347 | 1,121 |
| 3,542 | 3,631 | 13,519 | 3,591 | 3,276 | 3,512 | 3,142 | 11,611 | 3,217 | 2,858 | 2,984 | 2,553 | |
| Other companies and eliminations | 63 | 47 | 219 | 56 | 63 | 55 | 43 | 174 | 51 | 45 | 40 | 37 |
| 3,605 | 3,678 | 13,738 | 3,647 | 3,339 | 3,567 | 3,185 | 11,785 | 3,268 | 2,903 | 3,024 | 2,590 | |
| OPERATING PROFIT | ||||||||||||
| Caljan | 27 | 30 | 20 | 20 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Hultafors Group | 114 | 108 | 412 | 138 | 97 | 90 | 88 | 375 | 119 | 93 | 98 | 65 |
| Latour Industries | 48 | 71 | 257 | 60 | 74 | 67 | 56 | 191 | 55 | 57 | 48 | 31 |
| Nord-Lock Group | 84 | 97 | 411 | 71 | 94 | 124 | 121 | 397 | 89 | 106 | 108 | 94 |
| Swegon | 201 | 143 | 717 | 145 | 199 | 226 | 147 | 514 | 138 | 144 | 143 | 89 |
| 474 | 449 | 1,817 | 434 | 464 | 507 | 412 | 1,477 | 401 | 399 | 397 | 279 | |
| Gain/loss from sale/purchase of | -10 | -17 | 29 | -63 | -15 | 108 | -1 | -38 | -17 | -10 | -10 | -1 |
| business | ||||||||||||
| Other companies and items | -7 | -8 | -27 | -7 | -6 | -17 | 2 | -42 | 1 | -15 | -16 | -11 |
| 457 | 424 | 1,819 | 364 | 443 | 598 | 413 | 1,397 | 385 | 374 | 371 | 267 | |
| OPERATING MARGIN (%) | ||||||||||||
| Caljan | 12.2 | 13.3 | 17.4 | 17.4 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Hultafors Group | 13.6 | 12.8 | 14.2 | 15.9 | 13.9 | 13.3 | 13.6 | 15.6 | 16.6 | 15.1 | 13.6 | 13.6 |
| Latour Industries | 7.0 | 8.8 | 8.3 | 7.4 | 10.0 | 7.7 | 7.6 | 6.9 | 7.3 | 8.6 | 4.7 | 4.7 |
| Nord-Lock Group | 25.8 | 27.3 | 28.4 | 21.6 | 27.8 | 40.8 | 31.4 | 30.3 | 26.8 | 31.9 | 30.9 | 30.9 |
| Swegon | 13.7 | 10.2 | 12.0 | 9.9 | 13.2 | 10.7 | 10.7 | 10.0 | 9.7 | 11.5 | 8.0 | 8.0 |
| 13.4 | 12.4 | 13.4 | 12.1 | 14.2 | 13.1 | 13.1 | 12.7 | 12.5 | 14.0 | 10.9 | 10.9 | |
Change in sales in comparable entities after adjustment for acquisitions and foreign exchange effects.
Earnings before interest, tax, depreciation of property, plant and equipment and amortisation of acquisition-related intangible assets, acquisition-related costs and income, and items impacting comparability.
Earnings before interest, tax, amortisation of acquisitionrelated intangible assets, acquisition-related costs and income, and items impacting comparability.
Earnings before interest, tax, amortisation of acquisitionrelated intangible assets, acquisition-related costs and income, and items impacting comparability, as a percentage of net sales.
Earnings before interest and tax.
Operating profit divided by net sales.
Operating capital
Total assets less cash and cash equivalents, other interestbearing assets and non-interest-bearing liabilities. Calculated on the average for the past 12 months.
Total growth
Increase in revenue for the period as a percentage of the previous year's revenue.
Currency-driven growth
Increase in revenue due to currency changes for the period as a percentage of the previous year's revenue.
Increase in revenue for the period, adjusted for acquisitions/disposals and exchange rate changes, as a percentage of the previous year's revenue adjusted for acquisitions and disposals.
Basic earnings per share
Profit for the period divided by the number of outstanding shares in the period.
Calculations:
Jan-June 2020: 2,746/639,297,956 x 1000=4.29 Jan-June 2019: 3,372/639,143,936 x 1000=5.27
Calculations:
Jan-June 2020: 2,746/641,522,973 x 1000=4.28
Jan-June 2019: 3,372/641,394,124 x 1000=5.26
The ratio of shareholder equity to total assets.
The ratio of shareholder equity plus gains in associated companies to total assets including gains in associated companies.
Net borrowings
Interest-bearing liabilities less cash and cash equivalents and interest-bearing receivables.
The ratio of net borrowings to either adjusted equity or the market value of total assets.
The ratio of net income booked in the income statement to average equity.
The ratio of profit/loss after financial items plus finance expense to average total assets.
Return on operating capital
The ratio of operating profit to average operating capital.
Direct return
Dividends as a percentage of the share purchase price.
EBIT multiple
The ratio of operating profit to market value adjusted for net debt.
The difference between the company's assets and liabilities, when the investment portfolio (incl. associated companies) is recognised at market value and operative subsidiaries that are owned at the end of the period are recognised in an interval based on EBIT multiples for comparable listed companies in each business area.
Share of voting rights is calculated after deduction for repurchased shares.
Share of equity is calculated on total number of issued shares.
Other
The amounts in tables and other charts have each been rounded off. There may therefore be minor differences in the totals due to rounding-off.
For further information, please contact: Johan Hjertonsson, President and CEO, tel. +46 (0)702-29 77 93. Anders Mörck, Chief Financial Officer, tel. +46 (0)706 46 52 11 or +46 (0)31 89 17 90.
Presentation of performance for the quarter:
Investment AB Latour invites you to participate in a conference call with Johan Hjertonsson and Anders Mörck commencing today at 10.00.
The number to call is +46 (0)8 505 583 58. The conference will be broadcast on the Internet. To follow the presentation, please visit our website, www.latour.se.
Financial dates:
The interim report for the period January September 2020 will be published on 5 November 2020 The 2020 Year-End Report will be published on 12 February 2021 The interim report for the period January March 2021 will be published on 29 April 2021 The interim report for the period January June 2021 will be published on 23 August 2021 The interim report for the period January September 2021 will be published on 9 November 2021
The information contained in this report constitutes information which Investment AB Latour (publ) is required to disclose under the EU Market Abuse Regulation. The information was provided by the above contact persons for publication on 20 August 2020, at 08.30 CEST.
Investment AB Latour (publ) Corporate ID no. 556026 3237 J A Wettergrens gata 7, Box 336, SE-401 25 Gothenburg, Sweden Tel +46 (0)31 89 17 90 [email protected], www.latour.se
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