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Beijer Alma

Annual Report Feb 14, 2017

3006_10-k_2017-02-14_c6141951-016f-4861-b5ee-41ef6cf367dc.pdf

Annual Report

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Year-end report 2016

Strong end to the year

  • Net revenues amounted to MSEK 887 (841) for the quarter and MSEK 3,528 (3,522) for the full year.
  • Profit after net financial items totaled MSEK 113 (113) for the quarter and MSEK 447 (467) for the year.
  • Earnings per share amounted to SEK 2.48 (2.91) for the quarter and SEK 10.87 (11.74) for the year.
  • Cash flow after capital expenditures, excluding corporate acquisitions, totaled MSEK 69 (82) for the quarter and MSEK 252 (252) for the full year.
  • Net debt on the balance-sheet date amounted to MSEK 313 (194).
  • The Board proposes an unchanged dividend of SEK 9.50.
  • Lesjöfors acquired the spring manufacturer Spiralspecialisten in December.

CEO's comments

2016 ended on a strong note. While Beijer Tech delivered a weaker performance, both Lesjöfors and Habia reported higher invoicing than in the preceding year. For the Group as a whole, order bookings and invoicing rose 6 percent during the quarter and the stock of orders increased. Adjusted for acquisitions, growth amounted to 4 percent. Several key areas, including Chassis Springs in Lesjöfors and Telecom in Habia, began reporting positive growth.

Profit after net financial items, which was charged with nonrecurring costs in Beijer Tech, amounted to MSEK 113 (114). Excluding these nonrecurring costs, profit was MSEK 7 higher than in the preceding year and the operating margin was largely unchanged.

Cash flow remained positive during the quarter and totaled MSEK 69 (82). Net debt amounted to MSEK 313 (194), corresponding to a net debt/equity ratio of 16.5 percent.

Lesjöfors

Lesjöfors had a strong end to the year in both Chassis Springs and Industry. Invoicing rose a total of 11 percent. Adjusted for acquisitions, invoicing increased 6 percent.

Sales of chassis springs recovered after a number of weak quarters. The UK market, which was previously exposed to significant pressure, has now returned to the same level as in late 2015 and several other markets, including Germany and Russia, are experiencing favorable growth. Sales of chassis springs increased a total of 10 percent during the fourth quarter. However, the company's fullyear figures were adversely impacted by the weak start to the year and declined 6 percent. Demand remained strong in early 2017.

Sales in the Industry business area rose 11 percent. The acquisition of the Asian company John While Group contributed positively to this increase. Adjusted for this acquisition, growth amounted to 5 percent. From a geographical perspective, the company's performance was varied. The strongest trend was noted in the US market, following a weak start to the year. The German market continued to perform well, while the UK – as in earlier quarters – reported somewhat lower invoicing. The Nordic region and Asia were relatively stable.

Operating profit for the Lesjöfors Group increased to MSEK 96 (86), marking the company's strongest fourth-quarter result to date. The operating margin was in line with the preceding year.

Habia

Habia's invoicing rose 6 percent during the fourth quarter.

Demand in the telecom segment showed the strongest improvement after a number of weak quarters. This increase was attributable to the Asian market, particularly India, China and South Korea. Europe and the US, on the other hand, made a weaker contribution during 2015. Demand remained favorable in early 2017.

In other customer segments, which as a whole were in line with the corresponding quarter in the preceding year, defense displayed growth while nuclear power declined slightly. Full-year sales of cables to customers in the nuclear power segment increased 20 percent to a new record-breaking level. However, the stock of orders declined, indicating that sales in 2017 can be expected to be somewhat weaker.

Operating profit amounted to MSEK 30, which was in line with the preceding year. The operating margin fell slightly during the quarter.

Beijer Tech

Beijer Tech ended the year on a weak note. Sales and order bookings declined 6 percent during the fourth quarter. This decrease was entirely attributable to Industrial Products and the fact that the comparative data for the fourth quarter of 2015 included a high level of machinery sales. Fluid Technology displayed growth.

Earnings for the fourth quarter were charged with nonrecurring costs amounting to MSEK 8 related to the liquidation of inventories and personnel cuts. Adjusted for these costs, earnings were in line with the preceding year. At the start of 2017, costs had decreased compared with the average level for 2016.

Bertil Persson President and CEO

Group

During the fourth quarter, order bookings amounted to MSEK 897 (844), up 6 percent. Invoicing increased 6 percent to MSEK 887 (841). Adjusted for acquisitions, order bookings and invoicing rose 4 percent. Exchange rates had a marginal impact on both order bookings and invoicing.

Operating profit totaled MSEK 115 (115) and the operating margin was 13.0 percent (13.7). Profit after net financial items amounted to MSEK 113 (114). Earnings per share totaled SEK 2.48 (2.91). Fluctuations in exchange rates had an insignificant impact on earnings.

Cash flow after capital expenditures was MSEK 69 (82), excluding corporate acquisitions of MSEK 38 (0). Net debt totaled MSEK 313 (194) and the net debt/equity ratio was 16.5 percent (10.6).

During the full year, order bookings decreased 1 percent to MSEK 3,530 (3,548). Invoicing amounted to MSEK 3,528 (3,522). Corporate acquisitions and exchange-rate fluctuations had a net positive effect of 0.5 percent on order bookings and invoicing.

Operating profit for the full year totaled MSEK 455 (477) and the operating margin was 12.9 percent (13.6). Profit after net financial items amounted to MSEK 447 (467) and earnings per share totaled SEK 10.87 (11.74). Forward agreements and fluctuations in exchange rates had a marginally negative impact on earnings. Cash flow after capital expenditures, excluding corporate acquisitions of MSEK 78 (0), amounted to MSEK 252 (252).

An impairment test of consolidated goodwill did not give rise to any impairment.

Subsidiaries

Lesjöfors

Lesjöfors is a full-range supplier of standard and specially produced industrial springs as well as wire and flat strip components. The company is a dominant player in the Nordic region and one of the largest companies in its industry in Europe. Lesjöfors has manufacturing operations in Sweden, Denmark, Finland, Germany, Latvia, the UK, Slovakia, the US, Mexico, Singapore, Thailand and China.

During the quarter, order bookings amounted to MSEK 506 (452). Invoicing totaled MSEK 485 (437). Adjusted for exchange-rate fluctuations and corporate acquisitions, order bookings increased 7 percent and invoicing 6 percent. Operating profit amounted to MSEK 96 (86).

During the full year, order bookings reached MSEK 2,028 (1,998), up 2 percent. Invoicing increased 1 percent to MSEK 2,009 (1,996). Fluctuations in exchange rates and corporate acquisitions had a net positive impact of 1 percentage point on invoicing and order bookings. Operating profit totaled MSEK 380 (388).

Habia Cable

Habia Cable is one of Europe's largest manufacturers of custom-designed cables for customers in the telecom, transport, nuclear power, defense and other industries. The company has manufacturing operations in Sweden, Germany, China and Poland, and conducts sales worldwide.

During the quarter, order bookings amounted to MSEK 205 (195), up 5 percent. Invoicing increased 6 percent to MSEK 217 (206). Operating profit totaled MSEK 30 (31).

During 2016, order bookings fell 3 percent to MSEK 770 (790). Invoicing increased 3 percent to MSEK 787 (765). Operating profit amounted to MSEK 97 (99).

Beijer Tech

Beijer Tech specializes in industrial trading in the Nordic region and represents several of the world's leading manufacturers. The company's operations are conducted in two business areas: Industrial Products and Fluid Technology/Industrial Rubber.

During the quarter, order bookings and invoicing declined 6 percent compared with the year-earlier period and totaled MSEK 185 (197). Operating profit was charged with nonrecurring costs of MSEK 8, resulting in operating loss of MSEK 5 (profit: 3).

During the full year, order bookings and invoicing fell 4 percent to MSEK 731 (761). Operating profit amounted to MSEK 8 (18).

Parent Company

The Parent Company, Beijer Alma AB, is a holding company that does not conduct external invoicing. The Parent Company reported an operating loss of MSEK 6 (loss: 6) for the quarter and an operating loss of MSEK 30 (loss: 28) for full-year 2016. Net profit for the full year amounted to MSEK 277 (288) and included dividends and Group contributions totaling MSEK 312 (322).

Revenues and earnings per operating sector/segment

Net revenues

MSEK 2016 2016 2016 2016 2015 2015 2015 2015 2016 2015 2014
Full Full Full
Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 year year year
Lesjöfors 485.2 474.0 540.6 509.6 437.3 470.1 550.7 537.8 2,009.4 1,995.9 1,725.7
Habia Cable 217.3 196.3 168.7 204.5 205.9 198.2 171.6 189.4 786.8 765.1 790.2
Beijer Tech 184.6 169.8 189.1 187.6 197.4 170.3 204.9 188.0 731.1 760.6 782.1
Parent Company and intra-Group 0.1 0.1 0.1 0.1 0.1 0.2 0.3 0.2
Total 887.1 840.2 898.4 901.8 840.7 838.6 927.3 915.3 3,527.5 3,521.9 3,298.2
Operating profit
MSEK 2016 2016 2016 2016 2015 2015 2015 2015 2016 2015 2014
Full Full Full
Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 year year year
Lesjöfors 96.3 83.8 110.0 90.1 86.5 89.1 113.1 99.7 380.2 388.4 319.5
Habia Cable 30.2 29.1 15.7 22.0 31.0 29.7 17.8 20.5 97.0 99.0 93.6
Beijer Tech –4.8 4.2 4.5 4.0 3.4 6.0 7.4 0.7 7.9 17.5 44.1
Parent Company and intra-Group –6.5 –5.6 –11.0 –6.8 –5.5 –6.9 –9.8 –5.4 –29.9 –27.6 –29.7
Total operating profit 115.2 111.5 119.2 109.3 115.4 117.9 128.5 115.5 455.2 477.3 427.5
Net financial items –2.0 –2.2 –1.8 –2.2 –0.9 –2.3 –3.3 –3.9 –8.2 –10.4 –3.9

No sales are conducted between segments.

The Board's proposed dividend

The Board proposes that the Annual General Meeting approve a dividend of SEK 9.50 (9.50).

Annual General Meeting

The Annual General Meeting will be held on Wednesday, March 29, 2017 at 6:00 p.m. in the Main Hall (Stora Salen) of the Uppsala Concert and Conference Hall (Uppsala Konsert & Kongress), Vaksala torg 1, Uppsala. The Annual Report will be available at the company's office not more than three weeks prior to the Annual General Meeting and will be sent to shareholders around March 21, 2017.

Profit after net financial items 113.2 109.3 117.4 107.1 114.5 115.6 125.2 111.6 447.0 466.9 423.6

Corporate acquisitions

Lesjöfors acquired the spring manufacturer John While Group (JWG), with production operations in Singapore, Thailand and China. The acquisition strengthened Lesjöfors's position in the emerging markets in Asia. JWG specializes in the manufacturing of customized springs. Its customers mainly operate in the home electronics, white goods, automotive and engineering industries and predominantly include European and US companies with operations in Asia. The company has 115 employees and reported revenues of approximately MSEK 70 for 2015 with favorable profitability.

Acquisition calculation

Purchase consideration, of which MSEK 57.5 paid in
cash and the remainder to be paid within one year MSEK 70.5
(The acquisition included MSEK 17.5 in cash)
Acquired net assets measured at fair value MSEK 48.7
Goodwill MSEK 21.8

Goodwill was attributable to synergy effects within Lesjöfors and to inseparable customer relationships.

Total MSEK 48.7
Current non-interest-bearing liabilities MSEK –12.9
Bank deposits MSEK 17.5
Receivables MSEK 19.9
Inventories MSEK 14.3
Machinery MSEK 9.9
Net assets comprise:

The receivables guaranteed by the seller are assessed as having been transferred at fair value. Acquisition costs totaling a negligible amount were charged to net profit for the period.

Takeover occurred on May 1 and, since then, JWG has contributed MSEK 49 in invoicing and MSEK 5.3 in operating profit.

AB Spiralspecialisten

Lesjöfors acquired AB Spiralspecialisten, with production operations in Tyresö, Sweden. The company produces customized springs for Swedish and European customers in the engineering industry. Its risk spread across customers is favorable. Spiralspecialisten was founded in 1949 and has long-standing customer relationships with well-known engineering companies. The company's invoicing amounts to MSEK 45 with strong profitability.

Total MSEK 35.1
Deferred tax liability MSEK –5.2
Interest-bearing liabilities MSEK –0.3
Current non-interest-bearing liabilities MSEK –11.4
Bank deposits MSEK 6.4
Receivables MSEK 6.0
Inventories MSEK 4.1
Machinery MSEK 4.5
Buildings MSEK 31.0
Net assets comprise:
Goodwill was attributable to inseparable customer relationships and synergy effects.
Goodwill MSEK 9.4
Acquired net assets measured at fair value MSEK 35.1
(Including cash of MSEK 6.4)
Purchase consideration (paid in cash) MSEK 44.5
Acquisition calculation

The receivables are guaranteed by the seller and are assessed as having been transferred at fair value. Acquisition costs totaling an insignificant amount have been expensed.

Takeover occurred on December 31, 2016 and the acquisition had no impact on net revenues or earnings during 2016.

Events after the end of the period

No significant events occurred after the end of the period.

Risks and uncertainties

The Group's material risks and uncertainties include business and financial risks. Business risks may include major customer exposures to individual industries or companies. Financial risks primarily pertain to foreign currency risks that arise because more than 95 and 87 percent of sales for Habia and Lesjöfors, respectively, are conducted outside Sweden, while approximately 65 percent of production takes place outside Sweden. Beijer Tech does not have a corresponding foreign currency risk since about 71 percent of its sales are conducted in Sweden.

Management of the Group's financial risks is described in Note 30 of the 2015 Annual Report. The Group is deemed to have a favorable risk spread across industries and companies and the assessment is that the risk situation has remained unchanged during the year.

Condensed income statement

Group

MSEK 2016 2015 2016 2015 2014
Q4 Q4 Full-year Full-year Full-year
Net revenues 887.1 840.7 3,527.5 3,521.9 3,298.2
Cost of goods sold –584.6 –549.1 –2,381.7 –2,367.8 –2,229.1
Gross profit 302.5 291.6 1,145.8 1,154.1 1,069.1
Selling expenses –102.0 –98.3 –368.7 –366.1 –343.3
Administrative expenses –85.7 –78.3 –324.3 –313.2 –300.8
Other income 0.6
Profit
from
participations
in
associated
companies 0.4 0.4 2.4 2.5 1.9
Operating profit 115.2 115.4 455.2 477.3 427.5
Interest income 0.2 1.0 1.2 1.0 6.6
Interest expenses –2.2 –1.9 –9.4 –11.4 –10.5
Profit after net financial items 113.2 114.5 447.0 466.9 423.6
Tax on net profit for the period –38.7 –26.9 –119.4 –113.2 –104.3
Net profit attributable to Parent Company
shareholders 74.5 87.6 327.6 353.7 319.3
Other comprehensive income
Items that may be reclassified to profit or loss
Cash-flow hedges 2.9 3.8 –5.7 12.6 –4.7
Translation differences 8.7 –25.4 30.6 –19.7 60.3
Total other comprehensive income after tax 11.6 –21.6 24.9 –7.1 55.6
Total comprehensive income attributable to
Parent Company shareholders 86.1 66.0 352.5 346.6 374.9
Other comprehensive income pertains in its
entirety to items that may be reclassified to
profit or loss.
Net earnings per share
before and after dilution, SEK 2.48 2.91 10.87 11.74 10.60
Dividend per share, SEK
Includes amortization and depreciation in the
9.50 9.50 8.50
amount of, MSEK 29.9 27.1 117.3 110.6 98.4
Parent Company
MSEK 2016 2015 2016 2015 2014
Q4 Q4 Full-year Full-year Full-year
Administrative expenses –11.2 –10.0 –48.0 –45.8 –41.0
Other operating income 4.7 4.5 18.2 18.2 18.2
Operating profit –6.5 –5.5 –29.8 –27.6 –22.8
Group contributions 52.1 52.1 52.1 52.1 26.0
Income from participations in Group companies 260.0 270.0 260.0 270.0 246.0
Interest income and similar revenues 0.1 0.1 0.7 0.6 0.6
Interest expenses and similar expenses –0.2 –0.1 –0.7 –0.9 –0.8
Profit after net financial items 305.5 316.6 282.3 294.2 249.0
Tax on net profit for the period –10.3 –10.4 –5.8 –6.1 –1.2
Net profit 295.2 306.2 276.5 288.1 247.8

No items are attributable to other comprehensive income.

Condensed balance sheet

Group
MSEK 2016 2015 2014
Dec 31 Dec 31 Dec 31
Assets
Fixed assets
Intangible assets 550.6 508.6 546.6
Tangible assets 904.8 758.3 747.0
Deferred tax assets 19.1 18.6 25.6
Financial assets 30.3 28.7 27.8
Total fixed assets 1,504.8 1,314.2 1,347.0
Current assets
Inventories 717.9 673.3 636.5
Receivables 654.9 630.1 568.9
Cash and bank balances 273.6 252.2 191.3
Total current assets 1,646.4 1,555.6 1,396.7
Total assets 3,151.2 2,869.8 2,743.7
2016 2015 2014
Dec 31 Dec 31 Dec 31
Shareholders' equity and liabilities
Shareholders' equity
Share capital 125.5 125.5 125.5
Other contributed capital 444.4 444.4 444.4
Reserves 50.6 25.8 32.8
Retained earnings, including net profit for the period 1,281.0 1,239.6 1,142.0
Shareholders' equity attributable to Parent Company shareholders 1,901.5 1,835.3 1,744.7
Non-controlling interests 3.8 3.7 3.8
Total shareholders' equity 1,905.3 1,839.0 1,748.5
Non-current liabilities to credit institutions 242.8 206.0 229.1
Other non-current liabilities 66.2 56.3 84.8
Current liabilities to credit institutions 343.9 240.2 152.0
Current non-interest-bearing liabilities 593.0 528.3 529.3
Total liabilities 1,245.9 1,030.8 995.2
Total shareholders' equity and liabilities 3,151.2 2,869.8 2,743.7

Parent Company

MSEK 2016 2015 2014
Dec 31 Dec 31 Dec 31
Assets
Fixed assets
Tangible assets 1.2 1.1 1.1
Financial assets 532.2 532.2 532.2
Total fixed assets 533.4 533.3 533.3
Current assets
Receivables 362.8 367.6 327.9
Cash and cash equivalents 3.1 9.3 1.4
Total current assets 365.9 376.9 329.3
Total assets 899.3 910.2 862.6
MSEK 2016 2015 2014
Dec 31 Dec 31 Dec 31
Shareholders' equity and liabilities
Share capital 125.5 125.5 125.5
Statutory reserve 444.4 444.4 444.4
Retained earnings 12.8 11.0 19.3
Net profit for the period 276.5 288.1 247.8
Total shareholders' equity 859.2 869.0 837.0
Current liabilities to credit institutions 14.7 19.1 6.0
Current non-interest-bearing liabilities 25.4 22.1 19.6
Total shareholders' equity and liabilities 899.3 910.2 862.6

Condensed cash-flow statement Group

MSEK 2016 2015 2016 2015 2014
Q4 Q4 Full-year Full-year Full-year
Cash flow from operating activities before change in working capital and
capital expenditures 98.1 116.1 436.5 456.0 422.4
Change in working capital, increase (–) decrease (+) 29.8 –23.4 28.5 –92.7 –19.8
Cash flow from operating activities 127.9 92.7 465.0 363.3 402.6
Investing activities –60.0 –10.4 –213.3 –111.5 –141.4
Acquired companies less cash and cash equivalents –38.1 –78.1 –115.2
Cash flow after capital expenditures 29.8 82.3 173.6 251.8 146.0
Financing activities 5.1 –27.5 –152.2 –190.9 –208.5
Change in cash and cash equivalents 34.9 54.8 21.4 60.9 –62.5
Cash and cash equivalents at beginning of period 238.7 197.4 252.2 191.3 253.8
Cash and cash equivalents at end of period 273.6 252.2 273.6 252.2 191.3
Approved but not utilized committed credit facilities 694.3 630.8 694.3 630.8 645.0
Available liquidity 967.9 883.0 967.9 883.0 836.3

Specification of changes in consolidated shareholders' equity

MSEK 2016 2015 2014
Full-year Full-year Full-year
Opening shareholders' equity attributable to Parent Company shareholders 1,835.3 1,744.8 1,610.9
Comprehensive income for the period 352.4 346.6 374.9
Dividend paid –286.2 –256.1 –241.0
Closing shareholders' equity attributable to Parent Company shareholders 1,901.5 1,835.3 1,744.8
Non-controlling interests 3.8 3.6 3.8
Total closing shareholders' equity 1,905.3 1,838.9 1,748.6

Specification of shareholders' equity attributable to Parent Company shareholders for the period

December 31, 2016 125.5 444.4 50.6 1,281.0 1,901.5
Comprehensive income for the period 24.8 327.6 352.4
Dividend paid –286.2 –286.2
December 31, 2015 125.5 444.4 25.8 1,239.6 1,835.3
MSEK Share capital Other contributed capital Reserves period Total
Retained earnings,
including net profit for the

Number of shares

2016 2015 2014
Dec 31 Dec 31 Dec 31
Number of shares outstanding 30,131,100 30,131,100 30,131,100
Total number of shares, after full dilution 30,131,100 30,131,100 30,131,100
Average number of shares, after full dilution 30,131,100 30,131,100 30,131,100

Of the total number of shares outstanding, 3,310,000 are Class A shares and the remaining shares are Class B shares.

Note 1 Accounting policies

Group

This interim report was prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the European Union (EU). The presentation of the interim report complies with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act.

No new or revised IFRS that took effect in 2016 had a significant impact on the Group. Accounting policies and terms of calculation are unchanged compared with those applied in the 2015 Annual Report. Significant accounting and valuation policies are found on pages 48–51 of the 2015 Annual Report.

The fair value of financial assets and liabilities is deemed to correspond to the carrying amount.

Use of performance measures not defined in IFRS

As of the second quarter, Beijer Alma has applied the European Securities and Markets Authority's (ESMA) new Guidelines on Alternative Performance Measures. In short, an alternative performance measure is a financial measure of historical or future financial performance, financial performance or cash flows that is not defined or specified in IFRS. Definitions of the performance measures used in this interim report are available on the company's website.

Parent Company

The Parent Company, Beijer Alma AB, applies the Swedish Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2 Accounting for Legal Entities. These accounting policies correspond with the preceding year and with the consolidated accounting policies where applicable.

The interim report comprises pages 1–1 and pages 1–5 are an integrated part of this financial report.

Note 2 Pledged assets and contingent liabilities

Group Parent
Company
2016 2015 2016 2015
Pledged assets 606.6 651.2 13.4 13.4
Contingent liabilities 16.5 9.8

Key figures

2016 2015 2016 2015 2014
Q4 Q4 Full-year Full-year Full-year
Number of shares 30,131,100 30,131,100 30,131,100 30,131,100 30,131,100
Net revenues, MSEK 887.1 840.7 3,527.5 3,521.9 3,298.2
Operating profit, MSEK 115.2 115.4 455.2 477.3 427.5
Profit before tax, MSEK 113.2 114.5 447.0 466.9 423.6
Earnings per share after tax, SEK
Earnings per share after 22.0%
2.48 2.91 10.87 11.74 10.60
standard tax, SEK
Cash flow after capital expenditures,
2.93 2.96 11.57 12.09 10.96
excluding acquisitions per share, SEK 1.26 2.74 7.36 8.36 8.66
Return on shareholders' equity, % 19.0 19.8 18.7 20.3 19.7
Return on capital employed, % 18.9 20.5 19.1 21.7 21.3
Shareholders' equity per share, SEK 63.11 60.91 63.11 60.91 57.91
Equity ratio, % 60.3 64.0 60.3 64.0 63.6
Net debt/equity ratio, %
Cash and cash equivalents, including
16.5 10.6 16.5 10.6 10.9
unutilized credit facilities, MSEK 967.9 883.0 967.9 883.0 836.3
Investments in tangible assets, SEK 66.0 135.8 203.6 135.8 140.0
Interest-coverage ratio, multiple 54.2 69.9 48.8 41.8 41.3
Number of employees at end of period 2,340 2,342 2,340 2,342 2,179

It is our opinion that the year-end report for 2016 provides a true and fair overview of the Parent Company's and the Group's operations, financial position and earnings and describes the material risks and uncertainties to which the Parent Company and the companies included in the Group are exposed.

Uppsala, February 14, 2017

Beijer Alma AB (publ)

Johan Wall Carina Andersson Marianne Brismar Chairman of the Board Director Director

Anders G. Carlberg Peter Nilsson Caroline af Ugglas Director Director Director

Anders Ullberg Bertil Persson Director President and CEO

Review report on the condensed interim information (interim report) prepared in accordance with IAS 34 and Chapter 9 of the Swedish Annual Accounts Act

Introduction

We have reviewed the condensed interim financial information (interim report) of Beijer Alma AB (publ) as of December 31, 2016 and the 12-month period then ended. The Board of Directors and the President are responsible for the preparation and presentation of the interim financial information in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.

Scope of review

We conducted our review in accordance with the International Standard on Review Engagements ISRE 2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different focus and a substantially more limited scope compared with the focus and scope of an audit conducted in accordance with the International Standards of Auditing (ISA) and other generally accepted auditing practices. The procedures performed in a review do not enable us to obtain a level of assurance that would make us aware of all significant circumstances that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent Company.

Uppsala, February 14, 2017

Öhrlings PricewaterhouseCoopers AB

Leonard Daun Authorized Public Accountant

If you have any questions, please contact: Bertil Persson, President and CEO, Telephone +46 8 506 427 50, [email protected] Jan Blomén, Chief Financial Officer, Telephone +46 18 15 71 60, [email protected]

This information is information that Beijer Alma AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 11,25 a.m. on February 14, 2017.

______________________________________________________________________________________

Read more at: www.beijeralma.se

Visit our subsidiaries: www.lesjoforsab.com www.habia.com www.beijertech.se

Next report date: Interim report on May 4, 2017.

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