Garo

Interim / Quarterly Report • Aug 25, 2017

Interim Report second quarter of 2017

Continued healthy growth and strong EBIT

• Net sales increased 21% to MSEK 192.0 (159.1).
• EBIT rose 22% to MSEK 22.5 (18.5).
• EBIT margin amounted to 11.7% (11.6).
• Net income was MSEK 17.9 (15.4).
• Earnings per share totaled SEK 1.79 (1.54).
• The equity ratio was 47.1% (48.4).

MSEK	Apr–Jun 2017	Apr–Jun 2016	%	Jan–Jun 2017	Jan–Jun 2016	%	R12**	2016
Net sales	192.0	159.1	21	373.6	308.7	21	722.7	657.8
EBIT	22.5	18.5	22	46.1	21.2	117	98.7	73.8
EBIT margin	11.7%	11.6%	-	12.3%	6.9%	-	13.7%	11.2%
Net income	17.9	15.4	16	36.4	17.7	106	7.57	57.0
Earnings per share	1.79	1.54	16	3.64	1.77	106	7.57	5.70
Adjusted EBIT	-	-	-	-	33.8*	36	-	86.4*
Adjusted EBIT margin	-	-	-	-	10.9%*	-	-	13.1%*
Adjusted net income	-	-	-	-	27.5*	32	-	66.8*
Adjusted EPS, SEK	-	-	-	-	2.75*	32	-	6.68*

*) Adjusted for items affecting comparability of MSEK -12.6 in EBIT and MSEK -9.8 in net income related to the IPO.

**) Rolling 12 months, July 2016–June 2017.

GARO develops, manufactures and supplies innovative products and systems for the electrical installations industry under its own brand. The company has operations in Sweden, Norway, Finland, Ireland and Poland, and the Group is organized in two business segments: GARO Sweden and GARO Other markets. GARO has a broad product assortment and is a market leader within several product areas. The Group had sales of approximately MSEK 658 in 2016 and has around 330 employees. Its head office is located in Gnosjö.

The business concept is "with a focus on innovation, sustainability and design, GARO provides profitable complete solutions for the electrical industry."

CEO's comments on the quarter

The second quarter trended in line with our expectations. Net sales increased 21% to MSEK 192.0 driven by strong growth in GARO Sweden and a favorable trend for construction-related product areas. A lower number of trading days during the quarter negatively affected net sales by five percentage points.

EBIT rose 22% to MSEK 22.5. The fewer number of sales days had approximately MSEK 3 negative impact on EBIT. The EBIT margin amounted to 11.7% compared with 11.6% the previous year. Results during the quarter were also negatively impacted by temporary costs for supply-capacity extension.

Product development is a key factor for Garo's long-term success. During the quarter, we launched a new generation of car block heaters with several new functions, enhanced design and that allow connection to cloudbased services. We believe that this will further strengthen our market leading position in the area.

Net sales for GARO Sweden rose 37% in a continued strong construction market with all product areas reporting healthy growth. The strongest trend was posted by the Project business product area, whose market position has been significantly strengthened with the acquisition of Emedius. The integration of Emedius is ongoing and progressing as planned.

Furthermore, the Temporary electric installations product area trended favorably — the key drivers being an attractive product portfolio, good sales efforts and a booming construction sector.

Net sales for GARO Other Markets declined 5%. The trend for construction-related products and electrical distribution products was healthy. However, the trend for the EV charging product area was weaker than expected in the Norwegian market. At the time of writing, demand is healthy and we expect rising volumes in this area moving forward.

Our market assessment remains firm. In the market for charger products, we have noted a continuing strong trend and the expansion of charging infrastructure is ongoing in all markets. The construction sector continued to be robust in Sweden and Ireland, and demand is healthy in Norway and Finland. Overall, we have a positive outlook for 2017.

As announced previously, Carl-Johan Dalin has been appointed as the new President and CEO for GARO. He will take up his position on September 4. I will be supporting Carl-Johan during the introduction period and would like to welcome him to the company.

Stefan Jonsson, President and CEO

Group

Net sales

The Group's net sales for the second quarter of 2017 increased 21% to MSEK 192.0 (159.1) as a result of organic growth of 8%, the acquisition of Emedius AB in the first quarter of 2017, which added 11% to growth, and a positive currency effect of 2%.

Analysis of change from	Apr–Jun	Apr–Jun	Apr–Jun	Apr–Jun
net sales	2017 (MSEK)	2017 (%)	2016 (MSEK)	2016 (%)
Year-earlier period	159.1	-	131.6	-
Organic growth	13.1	8	31.1	24
Acquisitions and structural changes	17.5	11	0.0	0
Exchange-rate effects	2.3	2	-3.6	-3
Current period	192.0	21	159.1	21
Analysis of change from	Jan–Jun	Jan–Jun	Jan–Jun	Jan–Jun
net sales	2017 (MSEK)	2017 (%)	2016 (MSEK)	2016 (%)
Year-earlier period	308.7	-	250.5	-
Organic growth	35.4	11	65.7	26
Acquisitions and structural changes	24.1	8	0.0	0
Exchange-rate effects	5.4	2	-7.5	-3
Current period	373.6	21	308.7	23

The underlying market remained strong in Sweden and Ireland in all product areas where GARO operates. The construction market in Norway remained healthy, and growth in Finland trended favorably. Growth was negatively impacted by five percentage points during the quarter due to the reduced number of trading days compared with the year-earlier period.

EBIT

EBIT rose 22% to MSEK 22.5 (18.5) for the period and was mainly due to the acquisition of Emedius AB and due to the positive development for GARO Sweden. The operating profit was negatively affected by approximately MSEK 3 due to the lower number of trading days. The EBIT margin was 11.7% (11.6). Results in the quarter were also negatively impacted by temporary costs for supplycapacity extension.

GARO Group		Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun		Jan–Dec
Key figures		2017	2016	2017	2016	R12	2016
Net sales	MSEK	192.0	159.1	373.6	308.7	722.7	657.8
Growth	%	21	21	21	23	18	19
EBIT	MSEK	22.5	18.5	46.1	21.2	98.7	73.8
EBIT margin	%	11.7	11.6	12.3	6.9	13.7	11.2
Adjusted EBIT	MSEK	-	-	-	33.8*	-	86.4*
Adjusted EBIT margin	%	-	-	-	10.9*	-	13.1*
Investments	MSEK	6.0	3.1	23.9	5.2	31.5	12.8
Depreciation	MSEK	3.0	2.8	5.6	5.6	11.0	11.0
Return on equity	%	42.3	29.8	42.3	29.8	42.3	32.4
Equity ratio	%	47.1	48.4	47.1	48.4	47.1	52.0
Number of employees		330	261	330	261	330	274

*) Adjusted for items affecting comparability of a MSEK -12.6 in the first quarter of 2016 related to the IPO.

Net income

Net income for the second quarter amounted to MSEK 17.9 (15.4) and earnings per share amounted to MSEK 1.79 (1.54). The increase in net income was due to a stronger EBIT, which was partially offset by a decline in net financial items. Tax during the quarter amounted to MSEK -4.4 (-4.1). The average effective tax rate for the Group in the first half of 2017 was 20.5% (20.6).

Cash flow and investments

Cash flow from operating activities in the second quarter amounted to MSEK 12.5 (5.8), as a result of an improved EBITDA and a lower increase in working capital this year (MSEK 7.7) compared with the year-earlier period (MSEK 8.4). Cash flow was negatively affected by a paid tax liability of MSEK 6.1 pursuant to the previously announced tax ruling. Investments during the quarter increased to MSEK 6.0 (3.1) as a result of the plant extension for the Polish operations. The plant extension is progressing as planned and is expected to be completed in September 2017.

Liquidity and financial position

The Group's net debt at the end of the period amounted to MSEK 40.0 compared with MSEK 21.7 at the end of the second quarter of 2016 and net cash of MSEK 17.3 at year-end 2016. The increase in net debt was due to the acquisition of Emedius.

Available liquidity in the Group, including unutilized overdraft facilities, amounted to MSEK 81.4 (66.3) and the equity ratio was 47.1% (48.4).

Parent Company

The Parent Company's operations encompass a significant part of the Swedish operations and Group Management, as well as certain Group-wide functions and the Group's Finance function. Net sales for the Parent Company in the second quarter of 2017 amounted to MSEK 103.4 (85.7). Of this amount, MSEK 32.0 (24.6) comprised internal sales to other Group companies. EBIT amounted to MSEK 9.6 (5.8).

Operations and segments

GARO divides its operations into two operating segments based on how the Group is organized: GARO Sweden and GARO Other markets. GARO Other markets includes operations in Norway, Finland, Ireland and Poland.

Group Management comprises seven individuals and the functions of: President and CEO, CFO, IR Director, CMO, CTO, CEO GARO Norway and two business area managers who are responsible for their respective business areas/segment.

GARO Sweden

Net sales and earnings

Net sales for GARO Sweden increased 37% to MSEK 133.5 (97.6) during the second quarter of 2017, with continued good volume growth in all product areas. EBIT rose 49% to MSEK 13.4 (9.0) and the EBIT margin amounted to 10.0% (9.2).

Product areas

The electrical distribution products market, in which GARO is represented at all major wholesalers, is estimated to have grown by approximately 2% during the quarter and approximately 8% in the first six months. However, the Easter weekend was in the second quarter this year as opposed to the first quarter last year. After elimination of the effect of the difference in trading days, the underlying market is assessed as approximately as strong in the second quarter as in the first quarter. All constructionrelated product areas have enjoyed growth that has been significantly higher than the underlying markets.

The Project business product area reported the strongest trend during the quarter, and its market position has been significantly strengthened by the acquisition of Emedius AB. The company was consolidated within GARO from March 2017 and contributed MSEK 17.5 to the Group's sales. The integration of Emedius AB has progressed in line with expectations.

The Temporary electric installations product area also started the year well, especially within lighting products, and is benefiting from high levels of construction activity. The business is expanding and, in March, operations moved from the existing premises in Gnosjö to a new facility in Värnamo with more production space and good logistics.

The EV charging product area continues to increase rapidly, albeit slightly slower than the preceding quarter. GARO is a market leader in safe solutions for charging electric cars. Due to increased sales of electric cars, the network of charging stations is being expanded, which benefits GARO. Across the country, there are now 36,000 rechargeable cars and more than 3,600 public charging stations.

Operations

The focus of operations has been on meeting increased demand by expanding production capacity in all product areas, while maintaining short delivery times.

GARO Sweden		Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun		Jan–Dec
Key figures		2017	2016	2017	2016	R12	2016
Net sales	MSEK	133.5	97.6	255.3	188.6	485.7	419.0
Growth	%	37	17	35	17	29	20
EBIT	MSEK	13.4	9.0	29.6	3.5	62.2	36.1
EBIT margin	%	10.0	9.2	11.6	1.9	12.8	8.6
Adjusted EBIT*	MSEK	-	-	-	16.1	-	48.7*
Adjusted EBIT margin*	%	-	-	-	8.5	-	11.6*
Investments	MSEK	1.1	2.0	15.4	4.0	21.7	10.3
Depreciation	MSEK	2.4	2.1	4.4	4.3	8.9	8.8
Number of employees		217	173	217	173	217	181

*) Adjusted for IPO expenses of MSEK -12.6 in the first quarter of 2016.

GARO Other markets

Net sales and earnings

Net sales in GARO Other markets declined 5% to MSEK 58.5 (61.5). Volume growth in constructionrelated product areas in general and the Project business product area in particular was favorable while sales in EV charging were weaker year-on-year.

During the quarter, GARO Norway posted a positive trend in construction-related products, but a negative trend in EV charging. In 2015, GARO received a large order for quickchargers from a customer, which in 2015 and 2016, expanded a comprehensive network of quickchargers in the rapidly growing electric car market in Norway. Deliveries for this contract were substantial in the first three quarters of 2016. Comparative figures are therefore difficult to surpass. However, sales of home chargers have trended robustly.

GARO Ireland reported continued healthy growth and is following the positive trend in construction, while GARO Finland reported a weaker start to the first half, compared with the corresponding yearearlier period.

GARO Other markets		Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun		Jan–Dec
Key figures		2017	2016	2017	2016	R12	2016
Net sales	MSEK	58.5	61.5	118.3	120.1	237.0	238.8
Growth	%	-5	28	-1	35	1	17
EBIT	MSEK	9.1	9.5	16.5	17.7	36.5	37.7
EBIT margin	%	15.6	15.4	13.9	14.7	15.4	15.8
Investments	MSEK	4.9	1.1	8.5	1.2	9.8	2.5
Depreciation	MSEK	0.6	0.7	1.2	1.3	2.1	2.2
Number of employees	Number	113	88	113	88	113	93

EBIT was MSEK 9.1 (9.5) and the EBIT margin amounted to 15.6% (15.4).

Accounting policies

This interim report has been prepared in accordance with IAS 34, Interim Financial Reporting and the Swedish Annual Accounts Act. The Parent Company's accounts were prepared in accordance with Chapter 9 of the Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2.

The accounting policies applied correspond with the accounting policies and valuation principles presented in the 2016 Annual Report. The 2016 Annual Report is available at www.garo.se.

Performance measures together with the definitions of performance measures in this report are deemed to be sufficient to comply with the new guidelines. The performance measures in this report take into account the nature of the operations and are deemed to provide relevant information to shareholders and other stakeholders and also enable comparability with other companies.

Risks and uncertainties

GARO's risks and uncertainties are described on pages 57–59 of the 2016 Annual Report. The Annual Report is available at www.garo.se. No significant changes have arisen that alter the view of risks and uncertainties.

Related-party transactions

Related-party transactions took place at the same extent as previously, and the same principles were applied as those described in the 2016 Annual Report.

Gnosjö, August 25, 2017

Chairman Board member Board member

Anders Pålsson Sofia Axelsson Rickard Blomqvist

Per Holmstedt Lars Svensson Stefan Jonsson

Board member Board member President and CEO

The information in this interim report is unaudited.

GARO Q2 REPORT, AUG 25, 2017

GARO Group

GARO Sweden

GARO Other markets

Consolidated income statement

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	R12	Jan–Dec
Amount in MSEK	2017	2016	2017	2016		2016
Net sales	192.0	159.1	373.6	308.7	722.7	657.8
Other operating income	-	0.5	0.2	0.8	1.4	2.0
Total income	192.0	159.6	373.8	309.5	724.1	659.8
Operating expenses
Raw materials and consumables	-94.8	-82.8	-187.4	-163.2	-365.2	-341.0
Other external expenses	-23.4	-19.4	-45.7	-37.2	-90.3	-81.8
Personnel expenses Depreciation/amortization of	-48.3	-36.1	-89.0	-69.7	-158.9	-139.6
tangible and intangible assets	-3.0	-2.8	-5.6	-5.6	-11.0	-11.0
Other operating expenses	-	-	-	-12.6	-	-12.6
EBIT	22.5	18.5	46.1	21.2	98.7	73.8
Result from financial items
Net financial income/expenses	-0.2	1.0	-0.3	1.1	-2.4	-1.0
Profit before tax	22.3	19.5	45.8	22.3	96.3	72.8
Income tax	-4.4	-4.1	-9.4	-4.6	-20.6	-15.8
Net income	17.9	15.4	36.4	17.7	75.7	57.0
Other comprehensive income: Items that may be reclassified to the income statement
Translation differences	-0.1	0.4	0.7	0.7	1.6	1.6
Other comprehensive income,
net	-0.1	0.4	0.7	0.7	1.6	58.6
Total comprehensive income for the year	17.8	15.8	37.1	18.4	77.3	58.6
Net income and total comprehensive income for the year is attributable to shareholders of the Parent company
Key ratios per share
Average number of shares	10,000,000	10,000,000	10,000,000	10,000,000	10,000,000	10,000,000
Earnings per share, SEK	1.79	1.54	3.64	1.77	7.57	5.70

Consolidated balance sheet

Amount in MSEK	Jun 30, 2017	Jun 30, 2016	Dec 31, 2016
ASSETS
Fixed assets
Intangible assets	32.6	8.1	8.6
Tangible assets	82.0	57.4	58.8
Financial assets	-	-	-
Total fixed assets	114.6	65.5	67.4
Current assets
Inventories	126.7	97.0	97.3
Accounts receivable	163.2	136.2	163.5
Other current receivables	10.0	6.7	4.2
Cash and cash equivalents	15.7	15.6	41.6
Total current assets	315.6	255.5	306.6
TOTAL ASSETS	430.2	321.0	374.0
EQUITY AND LIABILITIES
Share capital	20.0	20.0	20.0
Other reserves	0.6	-1.1	-0.1
Other equity including net income for the period	182.0	136.4	174.5
Total equity	202.6	155.3	194.4
Long-term liabilities
Interest-bearing liabilities	24.3	11.2	10.5
Other provisions	1.5	0.9	1.6
Deferred tax liabilities	5.0	6.0	4.6
Total long-term liabilities	30.8	18.1	16.7
Short-term liabilities
Interest-bearing liabilities	31.4	26.1	13.8
Accounts payable	85.4	60.2	67.4
Other short-term liabilities	80.0	61.3	81.7
Total short-term liabilities	196.8	147.6	162.9
TOTAL EQUITY AND LIABILITIES	430.2	321.0	374.0
Key figures
Net debt	40.0	21.7	-17.3
Equity ratio	47.1%	48.4%	52.0%
Equity per share, SEK	20.3	15.5	19.4
Number of shares outstanding, '000	10,000.0	10,000.0	10,000.0

Changes in consolidated equity

Equity attributable to shareholders in the Parent Company Amount in MSEK	Share capital	Reserves	Retained profit	Total equity
Equity at January 1, 2016	14.0	-1.7	144.6	156.9
Net income for the period	-	-	57.0	57.0
Other comprehensive income for the period	-	1.6	-	1.6
Stock dividend per January 12, 2016	6.0	-	-6.0	-
Dividend to shareholders	-	-	-20.3	-20.3
Change in value, liability, put option	-	-	-0.8	-0.8
Closing equity, December 31, 2016	20.0	-0.1	174.5	194.4
Equity at January 1, 2017	20.0	-0.1	174.5	194.4
Net income for the period	-	-	36.4	36.4
Other comprehensive income for the period	-	0.7	-	0.7
Dividend to shareholders	20.0	-	-28.9	-28.9
Closing equity, June 30, 2017	20.0	0.6	182.4	202.6

Condensed consolidated cash-flow statement

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Rolling	Jan–Dec
Amount in MSEK	2017	2016	2017	2016	12m	2016
Operating activities
Cash flow from operating activities
before changes in working capital	20.2	14.2	36.3	11.6	89.5	64.8
Cash flow from changes in working capital	-7.7	-8.4	-8.6	-9.2	-15.8	-16.4
Cash flow from operating activities	12.5	5.8	27.7	2.4	73.7	48.4
Investing activities
Investments in intangible assets	-1.4	-0.7	-3.2	-1.2	-5.6	-3.6
Acquisition of subsidiaries	-0.1	-	-29.9	-	-29.9	-
Investments in tangible assets	-7.8	-2.4	-23.9	-4.0	-29.1	-9.2
Disposal of tangible assets	0.9	-	1.2	-	2.3	1.1
Cash flow from investing activities	-8.4	-3.1	-55.8	-5.2	-62.3	-11.7
Financing activities
Net borrowing/amortization of loans	16.7	-0.5	31.4	14.6	17.1	0.3
Dividend paid to shareholders	-28.9	-	-28.9	-20.0	-29.2	-20.3
Cash flow from financing activities	-12.2	-0.5	2.5	-5.4	-12.1	-20.0
Cash flow for the period	-8.1	2.2	-25.6	-8.2	-0.7	16.7
Currency effect in cash and cash equivalents	-0.2	0.5	-0.3	0.6	0.8	1.7
Cash and cash equivalents, start of the period	24.0	12.9	41.6	23.2	15.6	23.2
Cash and cash equivalents, end of the period	15.7	15.6	15.7	15.6	15.7	41.6

Parent Company income statement

	Apr–Jun	Apr–Jun	Jan–Jun	Jan–Jun	Jan–Dec
Amount in MSEK	2017	2016	2017	2016	2016
Net sales	103.4	85.7	197.8	161.3	357.3
Other operating income	1.8	1.8	3.5	3.5	7.2
Total income	105.2	87.5	201.3	164.8	364.5
Operating expenses
Raw materials and consumables	-59.4	-50.9	-114.5	-96.4	-210.1
Other external expenses	-10.5	-9.5	-21.7	-18.5	-43.7
Personnel expenses	-23.6	-19.3	-43.8	-37.1	-73.5
Depreciation/amortization of tangible and intangible assets
tangible assets	-2.1	-2.0	-4.0	-4.0	-8.3
Other operating expenses	-	-	-	-12.6	-12.6
EBIT	9.6	5.8	17.3	-3.8	16.3
Result from financial items
Profit from participations in Group companies	9.3	-	9.3	-	16.9
Net interest income and similar items	0.3	0.9	0.4	1.5	1.0
Net interest expenses and similar items	-0.2	0.2	-0.6	-0.1	-0.8
Profit before tax	19.0	6.9	26.4	-2.4	33.4
Appropriations	-	-	-	-	14.4
Income tax	-2.1	-1.4	-3.7	0.6	-7.0
Net income	16.9	5.5	22.7	-1.8	40.8

Amount in MSEK	Jun 30, 2017	Jun 30, 2016	Dec 31, 2016
ASSETS
Intangible assets	5.8	7.2	7.4
Tangible assets	50.7	34.8	35.8
Participations in Group companies	12.8	12.8	12.8
Other financial assets	27.9	8.8	8.0
Total fixed assets	97.2	63.6	64.0
Current assets
Inventories	60.3	46.5	44.2
Accounts receivable	72.1	64.4	78.3
Other receivables	35.2	34.1	49.4
Cash and cash equivalents	2.8	1.6	18.2
Total current assets	170.4	146.6	190.1
TOTAL ASSETS	267.6	210.2	254.1
EQUITY AND LIABILITIES
Share capital	20.0	20.0	20.0
Fund for internal development expenses	0.8	-	0.8
Statutory reserve	2.6	2.6	2.6
Non-restricted equity including net income for the period	122.3	86.3	128.1
Total equity	145.7	108.9	151.5
Untaxed reserves	6.2	10.6	6.2
Provisions	4.9	4.6	4.9
Liabilities
Long-term interest-bearing liabilities	15.6	8.6	7.8
Short-term interest-bearing liabilities	12.3	12.5	1.8
Short-term non-interest-bearing liabilities	82.9	65.0	81.9
Total liabilities	110.8	86.1	91.5
TOTAL EQUITY AND LIABILITIES	267.6	210.2	254.1

Parent Company balance sheet

		Sweden		Other markets		Elimination		Group
	Q2	Q2	Q2	Q2	Q2	Q2	Q2	Q2
Segment information	2017	2016	2017	2016	2017	2016	2017	2016
Sales
Total net sales	166.7	124.2	81.5	76.9	-56.2	-42.0	192.0	159.1
Internal net sales	-33.2	-26.6	-23.0	-15.4	56.2	42.0	-	-
External net sales	133.5	97.6	58.5	61.5	-	-	192.0	159.1
EBIT	13.4	9.0	9.1	9.5	-	-	22.5	18.5
Net financial income/expenses	-	-	-	-	-	-	-0.2	1.0
Tax expense for the year	-	-	-	-	-	-	-4.0	-4.1
Net income for the year	-	-	-	-	-	-	17.9	15.4

Sales and EBIT by segment

		Apr–	Apr–	Jan–	Jan–		Full	Full	Full	Full
GARO Group		Jun	Jun	Jun	Jun		year	year	year	year
Multi-year overview and key
ratios		2017	2016	2017	2016	R12	2016	2015	2014	2013
Net sales	MSEK	192.0	159.1	373.6	308.7	722.7	657.8	554.1	441.7	383.1
Growth	%	21	21	21	23	18	19	25	15	1
EBITDA	MSEK	25.5	21.3	51.7	26.8	109.7	84.8	74.3	50.6	34.8
EBITDA margin	%	13.3	13.4	13.8	8.7	15.2	12.9	13.4	11.5	9.1
EBIT	MSEK	22.5	18.5	46.1	21.2	98.7	73.8	62.4	39.8	24.0
EBIT margin	%	11.7	11.6	12.3	6.9	13.7	11.2	11.3	9.0	6.3
Adjusted EBIT	MSEK	-	-	-	33.8	-	86.4	62.4	39.8	24.0
Adjusted EBIT margin	%	-	-	-	10.9	-	13.1	11.3	9.0	6.3
Investments	MSEK	6.0	3.1	23.9	5.2	31.5	12.8	13.8	6.3	10.4
Depreciation	MSEK	3.0	2.8	5.6	5.6	11.0	11.0	11.9	10.8	10.8
Return on equity*	%	42.3	29.8	42.3	29.8	42.3	32.4	31.3	17.1	11.7
Equity ratio	%	47.1	48.4	47.1	48.4	47.1	52.0	49.8	48.5	51.3
Net debt	MSEK	40.0	21.7	40.0	21.7	40.0	-17.3	-0.4	19.3	39.5
	multip
Net debt/ EBITDA*	le	0.4	0.3	0.4	0.3	0.4	-0.2	0.0	0.4	1.1
No of employees		330	261	330	261	330	274	254	244	224

*) Key ratios are calculated on the last 12 months.

Quarterly figures

Consolidated income statement Amount in MSEK	Q2 2017	Q1 2017	Q4 2016	Q3 2016	Q2 2016	Q1 2016	Q4 2015	Q3 2015	Q2 2015
Net sales	192.0	181.6	200.9	148.2	159.1	149.6	167.4	136.2	131.6
Operating expenses	-169.5	-158.0	-170.6	-125.9	-140.6	-146.9	-151.0	-115.7	-117.7
EBIT	22.5	23.6	30.3	22.3	18.5	2.7	16.4	20.5	13.9
Net financial income/expenses	-0.2	-0.1	-2.2	0.1	1.0	0.1	-1.5	-0.4	-1.0
Profit before tax	22.3	23.5	28.1	22.4	19.5	2.8	14.9	20.1	12.9
Tax	-4.4	-5.0	-6.4	-4.8	-4.1	-0.5	-3.9	-4.1	-3.2
Net income	17.9	18.5	21.7	17.6	15.4	2.3	11.0	16.0	9.7
Net sales per segment	Q2	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2
Amount in MSEK	2017	2017	2016	2016	2016	2016	2015	2015	2015
GARO Sweden	133.5	121.8	135.9	94.5	97.6	91.0	105.3	82.9	83.7
GARO Other markets	58.5	59.8	65.0	53.7	61.5	58.6	62.1	53.3	47.9
Total Group	192.0	181.6	200.9	148.2	159.1	149.6	167.4	136.2	131.6
EBIT per segment	Q2	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2
Amount in MSEK	2017	2017	2016	2016	2016	2016	2015	2015	2015
GARO Sweden	13.4	16.2	19.3	13.3	9.0	-5.5	8.2	13.0	6.0
GARO Other markets	9.1	7.4	11.0	9.0	9.5	8.2	8.2	7.5	7.9
Total Group	22.5	23.6	30.3	22.3	18.5	2.7	16.4	20.5	13.9

Definitions

EBITDA: Earnings before interest, tax, depreciation and amortization EBIT: Earnings before interest and tax EBITDA margin, %: EBITDA as a percentage of net sales for the period EBIT margin, %: EBIT as a percentage of net sales for the period Net debt: Interest-bearing liabilities minus assets including cash and cash equivalents Net debt/EBITDA, multiple: Net debt at the end of the period as a percentage of EBITDA for the past 12 months R12: Rolling 12 months Equity per share: Equity divided by the number of shares at the end of the period Return on equity, %: Net income for the past 12 months divided by average equity Equity ratio, %: Equity as a percentage of total assets Earnings per share:

Earnings for the period divided by average number of shares

Teleconference

A teleconference for investors will be held on August 25 at 9:30 a.m.

Telephone numbers: Sweden: +46 8 50 510 036 International: +44 20 3059 8125

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

For more information, please contact:

Stefan Jonsson, President and CEO: +46 70 588 66 73 Lars Kvarnsund, CFO: +46 70 516 59 98 Patrik Linzenbold, IR Director: +46 708 25 26 30

Financial calendar

Third quarter of 2017: October 31 Fourth quarter of 2017: 21 February 2018

This information is such information that GARO aktiebolag is obligated to publish in accordance with the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was published by the abovementioned contact persons on August 25, 2017, at 7:30 a.m.

Forward-looking information

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