Serneke Group

Interim / Quarterly Report • Aug 20, 2020

INTERIM REPORT JANUARY – JUNE

HISTORICALLY STRONG ORDER BACKLOG

APRIL – JUNE 2020

2020

• Order bookings amounted to SEK1,851million (2,663)
• Income amounted to SEK1,393million (1,616)
• The operating loss amounted to SEK139million (0), affected by non-recurring costs amounting to SEK 145 million
• Cash flow from operating activities amounted to an outflow of SEK156million (302)
• Cash flow for the period amounted to an outflow of SEK38million (210)
• The loss for the period amounted to SEK114million (2)
• The reorganization process is progressing and the effects of this are expected to achieve their full impact in 2021
• The maturity of the bonds was extended by 18 months, with certain changes also being made to the terms and conditions, including the removal of a liquidity commitment.

JANUARY – JUNE 2020

• Order bookings amounted to SEK4,826million (3,840) and the order backlog was SEK11,072million (7,149)
• Income amounted to SEK3,207million (3,096)
• The operating loss amounted to SEK288million (18)
• Cash flow from operating activities amounted to an outflow of SEK389million (564)
• At the end of the period, available cash and cash equivalents totaled SEK450million (692)
• The loss for the period amounted to SEK220million (profit 8)

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	1,393	1,616	3,207	3,096	6,836	6,725
Operating profit	-139	0	-288	18	-390	-84
Operating margin, %	-10.0	0.0	-9.0	0.6	-5.7	-1.2
Profit/loss for the period	-114	-2	-220	8	-310	-82
Earnings per share, SEK, before dilution	-5.08	-0.09	-9.81	0.36	-13.82	-3.66
Earnings per share, SEK, after dilution	-5.08	-0.09	-9.81	0.35	-13.82	-3.66
Equity per share, SEK, after dilution	87.14	100.07	87.14	100.07	87.14	96.92
Equity/assets ratio, %	34.7	40.7	34.7	40.7	34.7	38.0
Net debt	1,490	1,334	1,490	1,334	1,490	1,224
Net debt/EBITDA	-4.5	2.6	-4.5	2.6	-4.5	-36.0
Net debt/equity ratio, %	76.1	58.9	76.1	58.9	76.1	56.2
Order bookings	1,851	2,663	4,826	3,840	9,587	8,601
Order backlog	11,072	7,149	11,072	7,149	11,072	8,943

CEO STATEMENT

The second quarter of the year – as well as the summer that is now drawing to a close – were pervaded by the global situation caused by the corona pandemic. For us, the pandemic had a direct effect with the sale of Karlatornet not being possible to complete as planned. Nor have we yet seen the full impact of the uncertainty caused by the pandemic on society in general. Fortunately, our industry has yet to be affected to the same extent as others. Housing prices, for example, have held a relatively stable level despite the economic downturn.

I can say with some confidence that we responded dynamically and quickly, realigning our organization and adapting to a more uncertain existence. This has involved measures directly associated with the pandemic, including short-term furloughs, as well as longer-term efficiencyenhancement measures, including reducing the workforce by about 100 jobs. Considerable focus was devoted to implementing these measures during the quarter. The organization rallied superbly behind our approach of prioritizing profitability.

Although we have by no means finished. We envisage this process taking several years. Nor do we expect our initial measures to be immediately reflected in our numbers. As we have said previously, the measures will not reach their full, anticipated impact until 2021. We have nonetheless been resolute and vigorous in our response and our approach holds strong. At this very moment, we are building a stronger Serneke.

Over the quarter, we saw some loss of volumes, partly due to construction starts being postponed because of the pandemic, with our sales of SEK1,393million (1,616) being approximately 14percent down on the corresponding period last year. Our operating loss of SEK139million (0) was affected by non-recurring costs of SEK145million attributable to our realignment of the organization, primarily within our civil engineering and project development operations, including staff cuts affecting about 85 people and increased provisions for risks and disputes in our projects. Over the quarter, we continued working proactively to achieve the financing solution needed if we are to be able to resume full production at Karlatornet. We have good hopes of soon being able to resume construction, with as brief a lead-up as possible, minimizing the impact on the schedule.

Our cash and cash equivalents, including unutilized credit facilities, stand at SEK450million, down SEK137million on the end of this year's first quarter. To a great extent, this is

linked to sales falling slightly over the quarter, as well as to costs for the Karlastaden project.

During the quarter, our record-high order backlog of SEK11,072million, was further strengthened by order bookings for SEK1,851million. A number of new contracts in housing, educational facilities and other societal functions show that extensive underlying need remains in the market, and that we are in demand as a contractor. We have a longterm order backlog, affording us favorable stability for the future.

During the quarter, we also extended a bond loan by 18 months, eliminating the liquidity commitment set out in the previous terms. Looking ahead, this contributes both to stability and flexibility, while also demonstrating the market's confidence in our business.

After many years focusing strongly on growth, our company is now at a phase in which we are working extensively to build for the next stage in the Company's development. We have now launched our new business plan, which extends until 2025. In this, we set out a clear approach for first generating profitability and stability while retaining our strong corporate culture and then developing our offering and identifying attractive new markets, both in Sweden and around the world. For me, this new business plan expresses clearly that not only are we a company with the energy to quickly become one of the largest players in the market, but that we are also able to act thoughtfully and wisely, while taking heed of the challenges facing us. Our journey towards our long-term objectives continues – becoming a community builder able to make a difference for human health, well-being and a sustainable future. While we have not altered our course, we are now adjusting our pace and setting out a clear strategy for achieving our objectives.

Ola Serneke, President and CEO

Order bookings SEK million	Apr–Jun 2020	Apr–Jun 2019	Jan–Jun 2020	Jan–Jun 2019	Jul–Jun 2019/2020	Jan–Dec 2019
Contracting	1,851	2,663	4,826	3,840	9,587	8,601
Order backlog	Jun 30	Jun 30	Dec 31
SEK million	2020	2019	2019
Contracting	11,072	7,149	8,943

ORDER BOOKINGS AND ORDER BACKLOG

External order bookings amounted to SEK1,851million (2,663) for the quarter. Despite the prevailing uncertainty in the market caused by the ongoing pandemic, the Group continues to secure numerous new projects around Sweden. Assignments secured during the quarter largely comprise public properties, such as schools/preschools and sheltered housing, but also a number of residential projects with an emphasis on rental apartments. The largest individual order during the quarter was valued at SEK200million, comprising production of rental apartments in Stockholm.

While market development remains uncertain, underlying demand remains, although reflecting a certain shift from private clients for residential projects to local government clients, with increased orders for public spaces and public properties.

At the end of the second quarter, the external order backlog was at its highest to date, amounting to SEK11,072million (7,149). This entails an increase of 55percent compared with the corresponding quarter last year.

NEW ORDERS VALUED AT MORE THAN SEK 100 million IN THE PERIOD APRIL – JUNE 2020

Assignment	Location	Order value (SEK million)	Anticipated start of construction
Housing	Stockholm	200	Third quarter 2020
Housing	Helsingborg	179	Fourth quarter 2020
Housing	Lund	177	Third quarter 2020
Housing	Gothenburg	168	Second quarter 2022
Housing	Trollhättan	155	First quarter 2021
Housing	Halmstad	107	Third quarter 2020
Housing	Trollhättan	100	Second quarter 2021

In Helsingborg, Serneke is to construct two buildings with a total of 87 apartments. One of the buildings will be 16 stories tall with a great view of the Sound.

INCOME AND PROFIT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	1,393	1,616	3,207	3,096	6,836	6,725
Operating profit	-139	0	-288	18	-390	-84
Net financial items	-8	-3	-13	-13	-27	-27
Earnings after financial items	-147	-3	-301	5	-417	-111
Tax	33	1	81	3	107	29
Profit/loss for the period	-114	-2	-220	8	-310	-82

APRIL – JUNE 2020

Consolidated income amounted to SEK1,393million (1,616), a decrease of 14percent. Income from the contracting operations fell by 9percent, amounting to SEK1,517million (1,666). The decrease is mainly attributable to lower activity in the civil engineering operations. Income from project development during the quarter amounted to SEK20million (26), with no housing cooperative projects being handed over to clients.

The operating loss amounted to SEK139million (0) and was negatively affected by ongoing structural changes in our civil engineering and project development operations, as well as by continuing expenditure associated with our cost-cutting program.

Net financial items were negative in the amount of SEK8million (3). During the quarter, borrowing expenses of SEK11million (2) on project properties were capitalized.

The Group reported an estimated tax expense of SEK33million (1). The positive tax effect is primarily explained by deferred tax related to tax loss carryforwards.

The loss for the period amounted to SEK114million (2) and earnings per share after dilution for the quarter were a negative SEK5.08 (0.09).

JANUARY – JUNE 2020

Consolidated income for the first half of the year amounted to SEK3,207million (3,096), an increase of 4percent. The contracting operations reduced income by 3percent to SEK3,092million (3,181). Income from project development amounted to SEK447million (55), with the increase being attributable to three housing cooperative projects having been handed over to the clients during the first quarter, contributing income of SEK390million (0).

The operating loss amounted to SEK288million (18) and was negatively affected by ongoing structural changes in our civil engineering and project development operations, as well as by continuing expenditure associated with our cost-cutting program.

Net financial items were negative in the amount of SEK13million (13). During the period, borrowing expenses of SEK25million (4) on project properties were capitalized.

The Group reported an estimated tax expense of SEK81million (3). The positive tax effect is attributable partly to the Group not having taxable income and a change in deferred tax related to tax loss carryforwards.

The loss for the period amounted to SEK220million (profit 8) and the loss per share after dilution was SEK9.81 (profit 0.35) for the period.

Operating profit per quarter

FINANCIAL POSITION

2020
	2019	2019
5,651	5,564	5,734
1,959	2,263	2,179
1,490	1,334	1,224
-4.5	2.6	-36.0
74	0	162
34.7	40.7	38.0

The consolidated balance sheet total amounted to SEK5,651million (5,734) as of June 30, and the equity/assets ratio was 34.7percent (38.0). At the end of the period, cash and cash equivalents amounted to SEK74million (162), in addition to which, the Group has a credit framework of SEK500million, of which SEK124million had been utilized, with SEK24million pertaining to a bank overdraft facility and the remainder to guarantees provided. At the end of the period, available cash and cash equivalents totaled SEK450million (692).

As of June 30, equity amounted to SEK1,959million (2,179). The change comprises the loss for the year of SEK220million.

As of June 30, net debt amounted to SEK1,490million (1,224). The foremost changes pertain to increased lease liabilities associated with new leases and loans of SEK276million from the Swedish Tax Agency due to the corona pandemic. Net debt in relation to EBITDA was a negative 4.5 (positive 2.6).

Net debt	Jun 30	Jun 30	Dec 31
SEK million	2020	2019	2019
Bank loans	169	207	169
Utilized bank overdraft facility	24	10	-
Construction credits, housing cooperative projects	57	269	308
Bonds	723	693	695
Financial lease liabilities	90	78	85
Additional lease liabilities, IFRS 16	267	88	158
Loans from the Swedish Tax Agency	276	-	-
Other interest-bearing liabilities	8	22	8
Interest-bearing receivables	-50	-33	-37
Cash and cash equivalents	-74	0	-162
Net debt	1,490	1,334	1,224

The SEK500million credit facility at Nordea carries one covenant, requiring the Group to maintain an equity/assets ratio of 25percent and another requiring that net debt in relation to EBITDA not exceed a multiple of 2.5. On the reporting date of June 30, 2020, the equity/assets ratio was 34.7percent and the debt /equity ratio was negative. For this, Nordea has waived the covenant in the credit facility agreement. The waiver is valid until the next reference date, September 30, 2020.

CAPITAL STRUCTURE

One of the Group's financial targets is for the equity/assets ratio to exceed 25percent.

The liquidity reserve shall amount to at least 5percent of income in the past 12-month period.

Liquidity reserve

CASH FLOW

			Jan–
	Apr–Jun	Apr–Jun	Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Cash flow from operating activities	-156	-302	-389	-564	-470	-645
Cash flow from investment activities	1	-33	-15	-45	241	211
Cash flow from financing activities	117	125	316	220	303	207
Cash flow for the period	-38	-210	-88	-389	74	-227
Cash and cash equivalents at beginning of period	112	210	162	389	0	389
Cash and cash equivalents at end of period	74	0	74	0	74	162

APRIL – JUNE 2020

Cash flow from operating activities amounted to an outflow of SEK156million (302), of which cash flow from changes in working capital amounted to an inflow of SEK30million (outflow 298).

Cash flow from investing activities amounted to an inflow of SEK1million (outflow 33).

Cash flow from financing activities amounted to an inflow of SEK117million (125) and is mainly explained by loans of SEK276million from the Swedish Tax Agency due to the corona pandemic and a reduction in the utilized bank overdraft facility by SEK166million compared with the first quarter.

Cash flow for the period amounted to an outflow of SEK38million (210).

Cash flow before financing

JANUARY – JUNE 2020

Cash flow from operating activities amounted to an outflow of SEK389million (564), of which cash flow from changes in working capital amounted to an outflow of SEK126million (526). The change in working capital has been adversely affected by investments of approximately SEK260million in the Karlastaden project, as well as positively by settled receivables of SEK84million from housing cooperatives.

Cash flow from investing activities amounted to an outflow of SEK15million (45).

Cash flow from financing activities amounted to an inflow of SEK

316million (220) and is mainly explained by newly raised loans of SEK276million from the Swedish Tax Agency due to the corona pandemic, contributions of SEK247million paid into housing cooperatives, repayments of loans in housing cooperatives of SEK249million and a utilized bank overdraft facility of SEK24million.

Cash flow for the period amounted to an outflow of SEK88million (389).

OVERVIEW SEGMENTS

The Serneke Group is divided into three segments: Contracting, Project Development and Other, which are reported as individual operating segments.

The Contracting segment conducts integrated construction, civil engineering and infrastructure-related operations. The segment conducts construction contracting for both external customers, as well as the Project Development segment.

The Project Development segment develops project and development properties by acquiring

developed or undeveloped land that is being refined into residential and commercial properties. The Project Development segment reports sales both as a contractor and as a developer.

The Other segment develops the Group's corporate holdings, including its holdings in associated companies.

Under Eliminations and Group-wide, central companies, Group functions and internal profit eliminations are reported.

SALES

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Contracting	1,517	1,666	3,092	3,181	6,341	6,430
Project Development	20	26	447	55	960	568
Other	27	33	53	57	96	100
Eliminations and Group-wide	-171	-109	-385	-197	-561	-373
Total	1,393	1,616	3,207	3,096	6,836	6,725

OPERATING PROFIT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Contracting	-90	36	-177	61	-208	30
Project Development	-48	-14	-120	-23	-152	-55
Other	0	1	1	2	-4	-3
Group-wide	-1	-23	8	-22	-26	-56
Total	-139	0	-288	18	-390	-84

Seasonal variations

To a certain extent, Serneke's operations are subject to seasonal effects. The contracting operations normally experience lower activity in the first quarter of the year due to fewer production days and, to a greater extent than normal, the weather during the winter months. Earnings are also affected by where public holidays fall, as this affects the number of production days.

CONTRACTING

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	1,517	1,666	3,092	3,181	6,341	6,430
Operating profit	-90	36	-177	61	-208	30
Operating margin, %	-5.9	2.2	-5.7	1.9	-3.3	0.5

APRIL – JUNE 2020

Income amounted to SEK1,517million (1,666), a decrease of 9percent. The decrease is mainly attributable to lower activity in the civil engineering operations.

The operating loss amounted to SEK90million (profit 36) and the operating margin ended up at a negative 5.9percent (positive 2.2). The margin was impacted negatively over the quarter. This was partly a consequence of the ongoing reorganization with its associated costs, but also reflects the operations' considerably more critical stance on the profitability of ongoing projects, resulting in impairment being recognized.

JANUARY – JUNE 2020

Income amounted to SEK3,092million (3,181), a decrease of 3percent. The decrease is mainly attributable to lower activity in the civil engineering operations.

The operating loss amounted to SEK177million (profit 61) and the operating margin ended up at a negative 5.7percent (positive 1.9). The margin was impacted negatively over the quarter. This was partly a consequence of the ongoing reorganization with its associated costs, but also reflects the operations' considerably more critical stance on the profitability of ongoing projects, resulting in impairment being recognized.

During the quarter, an agreement was signed with Wallfast to build 117 new rental apartments in the Södermalm district of Stockholm.

PROJECT DEVELOPMENT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	20	26	447	55	960	568
Share in profit of associates and joint
ventures	2	3	9	5	16	12
Operating profit	-48	-14	-120	-23	-152	-55
Operating margin, %	-240.0	-53.8	-26.8	-41.8	-15.8	-9.7

APRIL – JUNE 2020

Income amounted to SEK20million (26), a decrease of 23percent. No transactions were conducted during the quarter.

The share in the profit of associates and joint ventures amounted to SEK2million (3).

The operating loss amounted to SEK48million (14). Operating earnings were impacted negatively over the quarter.

This was partly a consequence of the ongoing reorganization with its associated costs, but also reflects the operations' considerably more critical stance on the profitability of ongoing projects, resulting in impairment being recognized.

At the end of the quarter, a total of three production projects were in progress, excluding Karlastaden, including one through a joint venture, comprising a total of 140 homes of which 119, or 85percent, had been sold.

JANUARY – JUNE 2020

Income amounted to SEK447million (55), an increase of 713percent. The increase is attributable to completed transactions for a total SEK399million of which three housing cooperative projects were handed over to clients, generating income of SEK390million.

The share in the profit of associates and joint ventures amounted to SEK9million (5).

The operating loss amounted to SEK120million (23). Operating earnings were impacted negatively over the quarter. This was partly a consequence of the ongoing reorganization with its associated costs, but also reflects the operations' considerably more critical stance on the profitability of ongoing projects, resulting in impairment being recognized. Completed sales of housing cooperative projects contributed SEK73million to operating profit.

Project development portfolio

The total book value of the project development portfolio amounted to SEK3,284million (3,274) as of June 30, 2020.

Development rights	Jun 30	Jun 30	Dec 31
Number (GFA)	2020	2019	2019
Development rights on own balance sheet	258,780	394,656	310,162
Development rights through joint ventures	106,354	60,436	58,011
Agreed development rights not yet taken into possession	574,839	433,429	482,247
Total	939,973	888,521	850,420

Housing construction projects developed in-house		Jun 30	Jul/Jun	Dec 31
	2020	2019	2019/2020	2019
Number of housing units under construction during the period	24	33	107	116
Number of housing units sold during the period	43	61	126	144
Total number of housing units under construction at the end of the period	732	801	758	827
Number of repurchased housing units on the Company's own balance sheet at the end of the period	4	-	5	1

PARENT COMPANY

The operations of Serneke Group AB (publ) consist mainly of Group Management and Group-wide services.

Income for April – June amounted to SEK12million (44) and consisted primarily of intra-Group services. The decrease in revenues is explained by the ongoing reorganization in which the central functions are being cut back. Operating profit for the same period amounted to SEK8million (4).

Income for the period January – June amounted to SEK49million (88), with the operating loss amounting to SEK4million (5).

The Parent Company is indirectly affected by the risks described in the section Significant risks and uncertainty factors.

RELATED-PARTY TRANSACTIONS

The nature and extent of transactions by related parties can be found in Note 36 of the 2019 Annual Report. During the year, related-party transactions have taken place with property company Adapta AB, Ludwig Mattson, Ola Serneke Invest AB, Ludwig Matsson, JV Sersund AB and associate Änglagården. Transactions with related parties have been made on market terms.

Transactions with Adapta AB are considered to constitute related-party transactions since the principal owner, Ludwig Matsson, is a member of the Board of Serneke Group. These transactions mainly comprised construction income and rental of Serneke's headquarters, with income amounting to SEK1million and purchases to SEK6million as of June 30, 2020. Transactions have also been conducted with private individual Ludwig Matsson regarding construction income of SEK3million. Transactions with Ola Serneke Invest AB are considered to be related party transactions, as Ola Serneke is the principal owner, CEO and a member of the Board of Serneke Group AB. As of June 30, 2020, income primarily comprised rent and amounted to SEK2million. Transactions with JV Sersund AB comprised construction income of SEK33million. Transactions with associate Änglagården consist mainly of contracted personnel, rental of premises, as well as rental of the venue name, with income amounting to SEK2million and purchases to SEK8million on June 30, 2020.

SIGNIFICANT RISKS AND UNCERTAINTIES

Serneke's operations entail several types of risks, both operational and financial. Operational risks are related to the daily operations and can apply to tenders or project development, assessment of profits, risks linked to production or the price trend. Operational risks are managed by the internal business management that has been developed within the Group. Identifying and managing Serneke's risks is crucial to the Group's profitability. Each segment manages its risks based on the business management and developed procedures and processes. Serneke's financial risks such as interest rate, liquidity, financing and credit risks are managed centrally in order to minimize and control risk exposure. The liquidity situation is assessed on an ongoing basis and, at the end of the second quarter, was considered adequate in relation to future needs. Should the situation or assessment change, contingencies are in place to safeguard the continued financing of the operations.

For further information on risks, as well as critical estimates and assessments, see the Board of Directors' Report and Notes 3 and 4 in the 2019 Annual Report. The descriptions in the Annual Report remain relevant. The Annual Report is published at www.serneke.group.

OTHER SIGNIFICANT EVENTS DURING THE REPORT PERIOD

Extension of bond maturity

On June 24, the terms were approved for extending the maturity of the bonds by 18 months until December 1, 2022. Among other things, the new terms also entail a liquidity undertaking (financial covenant) being removed and SEK200million being repaid by June 1, 2021. The amended terms are available on the Company's website https://ir.serneke.se/sv/obligationslan.

SIGNIFICANT EVENTS FOLLOWING THE REPORT PERIOD

Lawsuit filed by Upplands-Brohus

In July, a lawsuit was filed against Serneke by municipal housing company Upplands-Brohus. The dispute concerns the delivery of 178 rental apartments in Upplands-Bro, which were ready for tenants to move in at the end of 2017. According to the customer, Upplands-Brohus, there were shortcomings in the delivery and scheduling of the project. In Serneke's view, however, construction was executed in accordance with the contract. In its lawsuit, the customer seeks damages and costs totaling approximately SEK152million. Serneke has received the subpoena and will now prepare its defense, with proceedings not expected to commence in the District Court before 2021.

THE SERNEKE SHARE (SRNKE)

Serneke Group AB has two share series, Series A and B. On June 30, 2020, Serneke had approximately 7,700 shareholders and the closing price on June 30, 2020 was SEK47.3.

Serneke's ten largest shareholders, Jun 30, 2020

	Series A shares	No. of B shares	Total number of shares	Percentage of shares outstanding, %	Percentage of votes, %
Ola Serneke Invest AB	3,710,000	2,400,244	6,110,244	27.24%	56.98%
Lommen Holding AB	540,000	3,457,803	3,997,803	17.82%	12.78%
Christer Larsson i Trollhättan AB	380,000	497,000	877,000	3.91%	6.20%
Ledge Ing AB	330,000	456,061	786,061	3.50%	5.42%
Vision Group i väst AB	250,000	551,000	801,000	3.57%	4.40%
Svolder Aktiebolag	0	1,327,609	1,327,609	5.92%	1.92%
Cliens fonder	0	795,000	795,000	3.54%	1.15%
Nordnet Pensionsförsäkring AB	0	343,770	343,770	1.53%	0.50%
Försäkringsaktiebolaget Avanza	0	295,896	295,896	1.32%	0.43%
Bert-Åke Eriksson	0	271,687	271,687	1.21%	0.39%
Total, 10 largest	5,210,000	10,396,070	15,606,070	69.57%	90.15%
Other shareholders	0	6,827,395	6,827,395	30.43%	9.85%
Total shares outstanding	5,210,000	17,223,465	22,433,465	100.00%	100.00%
Repurchased shares	0	814,987	814,987
Total shares registered	5,210,000	18,038,452	23,248,452

Source: Euroclear and Serneke

Share series, number of shares and votes, Jun 30, 2020

Share class	Shares	Votes
Series A shares	5,210,000	5,210,000
Series B shares	17,223,465	1,722,346.5
Total	22,433,465	6,932,346.5

FINANCIAL CALENDAR

Interim Report January – September Nov 5, 2020 Year-end report 2020 Feb 26, 2021 Interim Report January – March May 6, 2021 Interim Report January – June August 19, 2021

The Board of Directors and the CEO certify that this Interim Report provides a fair overview of the Parent Company and Group's operations, position and performance and describes significant risks and uncertainties facing Serneke.

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

Gothenburg, August 20, 2020 Serneke Group AB (publ)

Board of Directors

Jan C. Johansson Chairman

Mari Broman Member

Ludwig Matsson Member

Ola Serneke CEO

Veronica Rörsgård Member

Anna Belfrage Member

Fredrik Alvarsson Member

Per Åkerman Member

For further information:

Michael Berglin, Deputy CEO E-mail: Michael.berglin@serneke.se Phone: +46 (0) 31712 97 00

Anders Düring, CFO E-mail: anders.antonsson@serneke.se Phone:: +46 (0)70 88 87 733

This information is such that Serneke Group AB (publ) is obliged to publish pursuant to the EU Market Abuse Regulation. The information was submitted for publication on August 20, 2020, at 8:00 a.m.

QUARTERLY DATA AND MULTI-YEAR REVIEW

	Apr– Jun	Jan–Mar	Oct–Dec	Jul–Sep	Apr–Jun	Jan–Mar	Oct–Dec	Jul–Sep
SEK million	2020	2020	2019	2019	2019	2019	2018	2018
Income
Contracting	1517	1,575	1,837	1412	1666	1515	1,937	1,337
Project Development	20	427	484	29	26	29	149	62
Other	27	26	24	20	33	24	27	27
Eliminations and Group-wide	-171	-214	-92	-85	-109	-88	-122	-67
Total	1,393	1,814	2,253	1,376	1,616	1,480	1,991	1,359
Operating profit
Contracting	-90	-87	-37	5	36	25	55	-35
Project Development	-48	-72	-32	0	-14	-9	460	-6
Other	0	1	2	-7	1	1	-2	-1
Group-wide	-1	9	-30	-3	-23	1	-4	2
Total	-139	-149	-97	-5	0	18	509	-40
Operating margin, %	-10	-8.2	-4.3	-0.4	0.0	1.2	25.6	-2.9
Profit after net financial items
Profit/loss for the period	-147 -114	-154 -106	-85 -63	-30 -27	-3 -2	8 10	501 572	-50 -55
Balance sheet
Fixed assets	779	678	661	941	910	1,106	1,094	1,998
Current assets	4872	4927	5,073	4,753	4,654	4,546	4,461	2,725
Total assets	5,651	5,605	5,734	5,694	5,564	5,652	5,555	4,723
Shareholders' equity	1959	2,074	2,179	2,238	2,263	2,257	2,272	1,721
Non-current liabilities	1262	1,430	1,719	1,615	1,669	1,573	1,289	1,317
Current liabilities
	2430	2,101	1,836	1,841	1,632	1,822	1,994	1,685
Total equity and liabilities	5,651	5,605	5,734	5,694	5,564	5,652	5,555	4,723
Orders
Order bookings	1,851	2,975	2,969	1,792	2,663	1,177	1,000	1,236
Order backlog	11,072	10,576	8,943	7,662	7,149	5,973	6,382	7,303
Employees
Average number of employees	1202	1,195	1,153	1,173	1,178	1,134	1,110	1,096

KEY INDICATORS

IFRS-based key indicators

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2020	2019
Income	1,393	1,616	3,207	3,096	6,836	6,725
Earnings per share, SEK, before dilution	-5.08	-0.09	-9.81	0.36	-13.82	-3.66
Earnings per share, SEK, after dilution	-5.08	-0.09	-9.81	0.35	-13.82	-3.66
Weighted average number of shares before dilution	22,433,465	22,433,465	22,433,465	22,433,465	22,433,465	22,433,465
Weighted average number of shares after dilution	22,481,968	22,613,468	22,481,968	22,613,468	22,492,926	22,558,676

Other key indicators

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2020	2019
Operating profit	-139	0	-288	18	-390	-84
Growth, %	-13.8	-3.9	3.6	-2.2	6.1	3.2
Order bookings	1,851	2,663	4,826	3,840	9,587	8,601
Order backlog	11,072	7,149	11,072	7,149	11,072	8,943
Organic growth, %	-13.8	-3.9	3.6	-2.2	6.1	3.2
Operating margin, %	-10.0	0.0	-9.0	0.6	-5.7	-1.2
Cash flow before financing	-155	-335	-404	-609	-229	-434
Cash flow from operations per share,
before dilution	-6.95	-13.46	-17.34	-25.14	-20.95	-28.75
Cash flow from operations per share,
after dilution	-6.95	-13.46	-17.34	-25.14	-20.95	-28.75
Equity per share, SEK, before dilution	87.32	100.88	87.32	100.88	87.32	97.13
Equity per share, SEK, after dilution	87.14	100.07	87.14	100.07	87.14	96.92
Working capital	2,442	3,022	2,442	3,022	2,442	3,237
Capital employed	3,573	3,630	3,573	3,630	3,573	3,602
Return on capital employed, %	-10.7	16.2	-10.7	16.2	-10.7	-2.2
Return on equity after taxes, %	-14.7	26.0	-14.7	26.0	-14.7	-3.7
Equity/assets ratio, %	34.7	40.7	34.7	40.7	34.7	38.0
Net debt	1,490	1,334	1,490	1,334	1,490	1,224
Net debt/equity ratio, %	76.1	58.9	76.1	58.9	76.1	56.2
Net debt/EBITDA	-4.5	2.6	-4.5	2.6	-4.5	-36.0

SUMMARY FINANCIAL STATEMENTS

SUMMARY OF CONSOLIDATED INCOME STATEMENT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	1,393	1,616	3,207	3,096	6,836	6,725
Production and administration expenses	-1,503	-1,562	-3,432	-2,982	-7,070	-6,620
Gross profit	-110	54	-225	114	-234	105
Sales and administration expenses	-30	-55	-70	-100	-167	-197
Share in profit of associates and joint
ventures	1	1	7	4	11	8
Operating profit	-139	0	-288	18	-390	-84
Net financial items	-8	-3	-13	-13	-27	-27
Profit after financial items	-147	-3	-301	5	-417	-111
Tax	33	1	81	3	107	29
Profit/loss for the period	-114	-2	-220	8	-310	-82
Attributable to:
Parent Company shareholders	-114	-5	-220	5	-310	-85
Non-controlling interests	0	3	0	3	0	3
Earnings per share before dilution, SEK	-5.08	-0.09	-9.81	0.36	-13.82	-3.66
Earnings per share after dilution, SEK	-5.08	-0.09	-9.81	0.35	-13.82	-3.66
Average number of shares before dilution	22,433,465	22,433,465	22,433,465	22,433,465	22,433,465	22,433,465
Average number of shares after dilution	22,481,968	22,613,468	22,481,968	22,613,468	22,492,926	22,558,676

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Profit/loss for the period	-114	-2	-220	8	-310	-82
Other comprehensive income	0	0	0	0	0	0
Total comprehensive income	-114	-2	-220	8	-310	-82

CONDENSED CONSOLIDATED BALANCE SHEET

	Jun 30	Jun 30	Dec 31
SEK million	2020	2019	2019
Assets
Fixed assets
Intangible fixed assets	23	23	23
Other tangible fixed assets	408	217	298
Investments in associates/joint ventures	153	131	145
Non-current interest-bearing receivables	50	33	37
Other non-current receivables	145	506	158
Total fixed assets	779	910	661
Current assets
Project and development properties	3,284	3,253	3,274
Inventories	1	1	1
Accounts receivable	870	859	825
Accrued but not invoiced income	479	383	560
Other current receivables	164	158	251
Cash and bank balances	74	0	162
Total current assets	4,872	4,654	5,073
Total assets	5,651	5,564	5,734
Equity and liabilities
Shareholders' equity	1,959	2,263	2,179
Non-current liabilities
Non-current interest-bearing liabilities	856	1,174	962
Other non-current liabilities	144	145	162
Deferred tax liability	48	154	128
Other provisions	214	196	183
Total non-current liabilities	1,262	1,669	1,435
Current liabilities
		193	461
Current interest-bearing liabilities	758	8	12
Current tax liabilities Accounts payable	0 877	706	958
Invoiced but not accrued income	490	497	347
Other current liabilities	305	228	342
Total current liabilities	2,430	1,632	2,120
Total equity and liabilities	5,651	5,564	5,734

SUMMARY OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY

	Jun 30	Jun 30	Dec 31
SEK million	2020	2019	2019
Equity attributable to Parent Company shareholders
Balance at beginning of period	2,179	2,272	2,272
Share-related compensation	0	8	15
Conversion, convertible debenture loans	-	-	-1
Changed accounting policy	-	-25	-25
Comprehensive income for the period	-220	5	-82
Non-controlling interests
Acquisition of non-controlling interests	-	-	0
Comprehensive income for the period	-	3	0
Balance at end of period	1,959	2,263	2,179

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Operating activities
Cash flow before change in working capital	-186	-4	-263	-38	-277	-52
Change in working capital	30	-298	-126	-526	-193	-593
Cash flow from operating activities	-156	-302	-389	-564	-470	-645
Investing activities
Increase/decrease in investing activities	1	-33	-15	-45	241	211
Cash flow from investing activities	1	-33	-15	-45	241	211
Cash flow before financing	-155	-335	-404	-609	-229	-434
Financing activities
Newly raised borrowings	290	119	323	201	568	446
Amortization of liabilities	-13	-1	-275	-1	-532	-258
Increase/decrease in financing activities	-160	7	268	20	267	19
Cash flow from financing activities	117	125	316	220	303	207
Cash flow for the period	-38	-210	-88	-389	74	-227
Cash and cash equivalents at beginning of period	112	210	162	389	0	389
Cash and cash equivalents at end of the period	74	0	74	0	74	162

PARENT COMPANY CONDENSED INCOME STATEMENT

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Income	12	44	49	88	139	178
Sales and administration expenses	-4	-48	-53	-93	-152	-192
Operating profit	8	-4	-4	-5	-13	-14
Net financial items	-56	-14	-68	-24	-135	-91
Profit after financial items	-48	-18	-72	-29	-148	-105
Appropriations	-	-	-	-	-	-
Profit/loss before tax	-48	-18	-72	-29	-148	-105
Tax	10	3	15	5	13	3
Profit/loss for the period	-38	-15	-57	-24	-135	-102

PARENT COMPANY STATEMENT OF COMPREHENSIVE INCOME

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jul–Jun	Jan–Dec
SEK million	2020	2019	2020	2019	2019/2020	2019
Profit/loss for the period	-38	-15	-57	-24	-135	-102
Other comprehensive income	0	0	0	0	0	0
Total comprehensive income	-38	-15	-57	-24	-135	-102

PARENT COMPANY CONDENSED BALANCE SHEET

Parent Company condensed consolidated balance sheet

	Jun 30	Jun 30	Dec 31
SEK million	2020	2019	2019
Assets
Fixed assets
Tangible fixed assets	9	13	13
Investments in Group companies	303	211	300
Investments in associates and joint ventures	-	10	-
Deferred tax assets	28	15	13
Other non-current receivables	3	4	3
Total fixed assets	343	253	329
Current assets
Project and development properties	2	3	2
Other current receivables	1,518	1,784	1726
Cash and bank balances	0	-	66
Total current assets	1,520	1,787	1,794
Total assets	1,863	2,040	2,123
Equity and liabilities
Shareholders' equity	361	490	417
Non-current liabilities
Non-current interest-bearing liabilities	726	705	699
Other provisions	2	1	2
Total non-current liabilities	728	706	701
Current liabilities
Current interest-bearing liabilities	39	115	10
Accounts payable	14	9	20
Other current liabilities	721	720	975
Total current liabilities	774	844	1,005
Total equity and liabilities	1,863	2,040	2,123

NOTES

NOTE 1 – Accounting policies

This interim report has been prepared in accordance with IAS 34, Interim Financial Reporting. The Interim Report has been prepared in accordance with International Financial Reporting Standards (IFRS), as well as interpretations of current International Financial Reporting Interpretations Committee (IFRIC) standards as adopted by the EU. The Parent Company's reports have been prepared in compliance with the Annual Accounts Act and the Financial Reporting Board's recommendation RFR 2, Accounting for Legal Entities. ESMA's guidelines on alternative key indicators are applied in the report.

The Interim Report has been prepared in accordance with the same accounting principles and calculation methods as in the 2019 Annual Report, with the addition of IAS 20 as detailed below. For detailed information regarding accounting policies, see Serneke's 2019 Annual Report, see www.serneke.se.

IAS 20 Accounting for Government Grants and Disclosure of Government Assistance

In connection with the corona pandemic, Serneke has received government support, mainly in the form of opportunities to defer payments of taxes and fees, temporarily reduced employer contributions and support for short-term work.

Serneke has chosen to report support for short-term work under Other income (SEK8million). These items are included in the accounts when it is reasonably certain that these grants will be received and that any conditions for the grants have been met.

Payments of taxes and fees were deferred in the amount of SEK276million, which is reported under current interest-bearing liabilities.

NOTE 2 – Financial assets and liabilities at fair value

Financial assets and financial liabilities measured at fair value in the balance sheet are classified according to one of three levels based on the information used to establish the fair value. The Group only holds financial assets and liabilities valued in level 3, which is why levels 1 and 2 have been omitted in the table below. No transfers have been made between the levels during the periods. A more detailed description of the levels can be found in Note 4 of the 2019 Annual Report.

Level 1 – Valuation is made according to prices in active markets for identical instruments.

Level 2 – Financial instruments for which the fair value is established based on valuation models that are based on observable data for the asset or liability other than quoted prices included in Level 1.

Level 3 – Financial instruments for which fair value is established based on valuation models where significant inputs are based on non-observable data.

Group SEK million	Jun 30 2020	Jun 30 2019	Dec 31 2019
Financial assets
Available-for-sale financial assets*	2	2	2
Total financial assets	2	2	2
Financial liabilities
Other short- and long-term liabilities	23	58	23
Of which, additional purchase considerations**	23	58	23
Total financial liabilities	23	58	23

* In the fair value calculation of available-for-sale financial assets at level 3, the market price method has been applied and the yield value assumption has been used.

** In the fair value calculation of the additional purchase considerations at level 3, project estimates, budgets and forecasts have been applied.

For the Group's other financial assets and financial liabilities, the reported values are assessed as corresponding to FAIR VALUE. No significant changes in valuation models, assumptions or inputs were made during the period.

NOTE 3 – Pledged assets and contingent liabilities

The Group pledges collateral for external loans. The Group's contingent liabilities arise primarily in connection with different property disposals, whereby various operational guarantees may occur, as well as performance guarantees for future contracts. Serneke Group AB (publ) has also

entered into a guarantee undertaking, which means that the co-owners in Prioritet Serneke Arena are jointly responsible for the correct fulfillment of interest and repayment of the associate's liabilities to credit institutions in the event that the associate is unable to pay.

Pledged assets and contingent liabilities in the consolidated balance sheet:

	Jun 30	Jun 30	Dec 31
Group	2020	2019	2019
Pledged assets	1,887	2,089	2,044
Contingent liabilities	284	420	350
Parent Company
Pledged assets	500	500	500
Contingent liabilities	2,265	2,128	2,262

NOTE 4 – Breakdown of income

Apr–Jun 2020, SEK million	Contracting	Project Developmen t	Other	Eliminations and Group-wide	Total
Construction income	1,507	10	27	-171	1,373
Sale of properties and development rights	-	5	-	-	5
Rental income	0	0	-	-	0
Other income	10	5	0	-	15
Total income	1,517	20	27	-171	1,393
Date of income recognition:
At a specific time	10	10	-	-	20
Over time	1507	10	27	-171	1,373
Total income	1,517	20	27	-171	1,393

		Project Developmen		Eliminations and
Apr–Jun 2019, SEK million	Contracting	t	Other	Group-wide	Total
Construction income	1,655	5	33	-109	1,584
Sale of properties and development rights	-	-	-	-	-
Rental income	0	0	-	-	0
Other income	11	21	-	-	32
Total income	1,666	26	33	-109	1,616
Date of income recognition:
At a specific time	11	21	-	-	32
Over time	1655	5	33	-109	1,584
Total income	1,666	26	33	-109	1,616

Jan–Jun 2020, SEK million	Contracting	Project Developmen t	Other	Eliminations and Group-wide	Total
Construction income	3,080	24	53	-385	2,772
Sale of properties and development rights	-	404	-	-	404
Rental income	0	3	-	-	3
Other income	12	16	0	-	28
Total income	3,092	447	53	-385	3,207
Date of income recognition:
At a specific time	12	420	-	-	432
Over time	3080	27	53	-385	2,775
Total income	3,092	447	53	-385	3,207

Jan–Jun 2019, SEK million	Contracting	Project Development	Other	Eliminations and Group-wide	Total
Construction income	3,168	16	57	-197	3,044
Sale of properties and development rights	-	-	-	-	-
Rental income	0	15	-	-	15
Other income	13	24	-	-	37
Total income	3,181	55	57	-197	3,096
Date of income recognition:
At a specific time	13	24	-	-	37
Over time	3168	31	57	-197	3,059
Total income	3,181	55	57	-197	3,096

Construction income

Income from contracting agreements is reported in accordance with IFRS 15 Revenue from Contracts with Customers, either by fulfilling the performance undertaking over time (that is, gradually) or at one specific time. Contracting agreements entail the construction contract being performed on the customer's land, where an asset is created over which the customer gains control in pace with the completion of the asset. This entails income being recognized gradually (over time), applyingpercentage-of-completion. When applyingpercentage-of-completion, the input method applies whereby income is reported based on the degree of completion,

which is calculated as the ratio between the expenses incurred for work performed at the end of reporting period and the estimated total expenses for the assignment. Revaluations of the project's final forecasts entail corrections of previously accumulated earnings. If it is probable that the total contract expenses will exceed the total contract income, the anticipated loss should be immediately recognized as a cost in its entirety. Additional orders and amendments are included in the income from the assignment to the extent that they are approved by the customer.

Sale of properties and development rights

On disposal of properties or development rights directly or indirectly through a sale of shares, the underlying property or development right's value is recognized in the Group as income. Income from property sales is reported at the time at which the new owner takes possession. When contracts include property sales, development rights and construction contracting to the buyer of the planned building, an assessment is made regarding whether the property and/or development rights transactions and the construction contract are separate performance undertakings. Depending on the design and terms of the

agreement, the sale can be seen as one or several performance undertakings. Sales are reported at the point in time at which control is transferred to the buyer. Control is transferred over time if the seller has no alternative use for the property sold and the seller is entitled to payment from the customer for the work performed. In such cases, income is reported applyingpercentage of completion. If any of the above criteria are not met, income is reported at a single point in time, on completion and transfer to the customer.

Sales of development rights can be dependent upon decisions regarding future detailed development plans. An assessment is then made as to the likelihood of the respective detailed development plan. Sales income and earnings are recognized when the probability is deemed to be very high. When sales income is recognized, all remaining commitments in the sales earnings are also taken into account. Property projects are also on occasion sold with guarantees for a certain degree of leasing and, at the time of sale, any lease guarantees are reported as a reserve in the project, which then has a positive effect on thepercentage of completion as leases are signed.

Rental income

Income also includes rental income, which is to be considered as operating leasing. Rental income is invoiced in advance and recognized on a straight-line basis in the income statement based on the terms of the lease agreements. Advance rent is reported as prepaid rental income. In cases where the rental contract allows a reduced rent for a certain period of time, which is compensated for by higher rent during another period, this is allocated across the term of the contract.

Other income

Other income refers to income not classified as construction income, sales of properties and

development rights or rental income, including, for example, hotel income or income from central companies.

FINANCIAL DEFINITIONS

Indicator	Definition				Purpose
Growth	Income for the period less income for the previous period	In the Company's view, the key indicator
	divided by income for the previous period.			allows investors, who so wish, to assess the
				Company's capacity to increase its earnings.
Organic	Income for the period, adjusted for acquired growth, less	In the Company's view, the key indicator
growth	income for the previous period, adjusted for acquired			allows investors, who so wish, to assess the
	growth, divided by income for the previous period,			Company's capacity to increase its income
	adjusted for acquired growth.	without acquiring operating companies.
	Apr–Jun Apr–Jun			Jan– Jan–Jun Jun Jul–Jun Jan–Dec
	Calculation of organic growth	2020	2019	2020	2019	2020	2019
Income current period		1,393	1,616	3,207	3,096	6,836	6,725
	Income corresponding to previous period	1,616	1,681	3,096	3,166	6,446	6,516
Income change		-223	-65	111	-70	390	209
	Adjustment for structural effect	0		0 0	0	0	0
Total organic growth		-223	-65	111	-70	390	209
Total organic growth (%)		-13.8%	-3.9%	3.6%	-2.2%	6.1%	3.2%
Order	The value of new projects and changes in existing projects			In the Company's view, this key indicator
bookings	during the period.			allows investors, who so wish, to assess the
							Company's sales in Business Area Contracting
				for the current period.
Order	The value of the Company's undelivered orders at the end		In the Company's view, this key indicator
backlog	of the period excluding cooperation agreements.		allows investors, who so wish, to assess the
				Company's income in Business Area
				Contracting over upcoming periods.
Operating	Operating profit divided by income.			In the Company's view, the key indicator
margin				allows investors, who so wish, to assess the Company's profitability.
Operating	Current assets less current liabilities.
capital				In the Company's view, the key indicator allows investors, who so wish, to assess the
				Company's tied-up capital in relation to its
				competitors.
Capital	Consolidated total assets less deferred tax assets less non			In the Company's view, this key indicator
employed	interest-bearing liabilities including deferred tax liabilities.			allows investors, who so wish, to assess the
					total capital placed at the Company's
	disposal by shareholders and creditors.
				Jun 30		Jun 30	Dec 31
	Calculation of capital employed				2020	2019	2019
	Total assets				5,651	5,564	5,734
	Deferred tax assets				0	0	0
	Less non-interest-bearing liabilities including deferred tax liabilities			-2,078		-1,934	-2,132
	Capital employed				3,573	3,630	3,602

Indicator	Definition	Purpose
Return on	Profit after net financial items plus financial expenses	In the Company's view, the key indicator
capital	divided by average capital employed for the period.	allows investors, who so wish, to assess the
employed	Accumulated interim periods are based on rolling 12-		Company's capacity to generate a return on
	month earnings.		the total capital placed at the Company's
		disposal by shareholders and creditors.
		Jun 30	Jun 30	Dec 31
	Calculation of average capital employed	2020	2019	2019
	Jun 30, 2020 (3,573) + Jun 30, 2019 (3,630) / 2	3,602
	Jun 30, 2019 (3,630) + Jun 30, 2018 (2,826) / 2		3,228
	Dec 31, 2019 (3,602) + Dec 31, 2018 (3,264) / 2			3,433
		Jun 30	Jun 30	Dec 31
	Calculation of return on capital employed	2020	2019	2019
	Profit after net financial items	-416	456	-111
	Plus financial expenses	29	67	36
	Average capital employed	3,602	3,228	3,433
	Return on capital employed	-10.7%	16.2%	-2.2%
Equity per	Total equity according to the balance sheet divided	The Company believes that key indicators give
share,	by the number of shares outstanding on the closing date. The difference between before and after	investors a better understanding of historical return
before/afte	dilution is accounted for by the convertibles issued		per share at the closing date.
r dilution	by the Group.
Cash flow	Cash flow from operating activities divided by the	It is the Company's view that the key indicator gives
from	average number of shares during the period. The difference between before and after dilution is	investors a better understanding of the operations'
operations	accounted for by the convertibles issued by the	cash flow in relation to the number of shares, adjusted for changes in the number of shares during
per share,	Group.
before/afte		the period.
r dilution
Earnings	Profit for the period divided by the average number of shares during the period. The difference between	It is the Company's view that the key indicator gives
per share,	before and after dilution is accounted for by the	investors a better understanding of profit per share.
before/afte r dilution	convertibles issued by the Group.

Indicator	Definition	Purpose
Return on equity	Profit for the period as apercentage of	In the Company's view, the key indicator allows investors,
	average shareholders' equity.		who so wish, to assess the Company's capacity to
	Accumulated interim periods are		generate a return on the capital shareholders have placed
	based on rolling 12-month earnings.		at the Company's disposal.
			Jun 30	Jun 30	Dec 31
	Calculation of average shareholders' equity	2020	2019	2019
	Jun 30, 2020 (1959) + Jun 30, 2019 (2,263) / 2		2,111
	Jun 30, 2019 (2,263) + Jun 30, 2018 (1,770) / 2			2,017
	Dec 31, 2019 (2,179) + Dec 31, 2018 (2,272) / 2				2,226
			Jun 30	Jun 30	Dec 31
	Calculation of return on shareholders' equity		2020	2019	2019
	Profit/loss for the period		-310	525	-82
	Average shareholders' equity		2,111	2,017	2,226
	Return on equity		-14.7%	26.0%	-3.7%
Equity/assets ratio	Shareholders' equity less minority	The equity/assets ratio shows the proportion of total
	interests as apercentage of total assets represented by shareholders' equity and has been
	assets.		included to allow investors to be able to assess the
			Company's capital structure.
Net debt	Interest-bearing liabilities less liquid		Net debt is a measure deemed relevant for creditors and
	assets less interest-bearing	credit rating agencies.
	receivables.
Net debt/equity ratio	Interest-bearing net debt divided by		Net debt/equity ratio is a measure deemed relevant for
	shareholders' equity.		creditors and credit rating agencies.
EBITDA	Operating profit excluding amortization/depreciation.		EBITDA is a measure deemed to provide investors a better
		understanding of the Company's earnings.
			Jun 30	Jun 30	Dec 31
	Calculation of EBITDA		2020	2019	2019
	Operating profit		-390	484	-84
	Depreciation		58	36	50
	EBITDA		-332	520	-34
Net debt/EBITDA	Interest-bearing liabilities less liquid
	assets less interest-bearing receivables divided by EBITDA.	Net debt/EBITDA is a measure deemed relevant for creditors and credit rating agencies.

SERNEKE IN BRIEF

Serneke is a growing corporate group providing comprehensive services in contracting and projectdevelopment with more than 1,100 employees. Through novel thinking, we drive development and create more effective and more innovative solutions for responsible construction. The business has a good mix of

Serneke Group AB (publ) Headquarters: Kvarnbergsgatan 2 SE-411 05 Gothenburg Phone: +46 (0)31-712 97 00 | info@serneke.se public and commercial assignments, providing strength over economic cycles.

Serneke's annual reports and other financial information are available under the tab Investors at www.serneke.se

Presentation of the Interim Report for January – June 2020

On August 20, 2020 at 9:00 a.m. (CET), Serneke Group will comment on this Interim Report in a conference call with an online presentation for investors, analysts and the media. The presentation will be held in Swedish and can be followed live via webcast athttps://tv.streamfabriken.com/serneke-q2-2020. Presentation materials for the presentation will be available on the website one hour before the webcast begins.

To participate, please dial: +46 8 505 58 350