Annual Report • Apr 23, 2013
Annual Report
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| Number of shares1) |
Ownership capital/votes2) (%) |
Share of total assets (%) |
Value, SEK/share |
Value, 3) SEK m. |
Contribution to net asset value |
Value, SEK m.3) |
|
|---|---|---|---|---|---|---|---|
| 3/31 2013 | 3/31 2013 | 3/31 2013 | 3/31 2013 | 3/31 2013 | YTD 2013 | 12/31 2012 | |
| Core Investments4) | |||||||
| Listed | |||||||
| Atlas Copco | 206 895 611 | 16.8/22.3 | 18 | 50 | 37 985 | 1 340 | 36 645 |
| SEB | 456 089 264 | 20.8/20.9 | 14 | 39 | 29 845 | 5 905 | 25 194 |
| ABB | 182 030 142 | 7.9/7.9 | 13 | 35 | 26 921 | 2 550 | 24 371 |
| AstraZeneca | 51 587 810 | 4.1/4.1 | 8 | 22 | 16 704 | 1 520 | 15 807 |
| Ericsson | 174 303 252 | 5.3/21.4 | 6 | 18 | 13 943 | 2 823 | 11 120 |
| Electrolux | 47 866 133 | 15.5/29.9 | 4 | 11 | 7 927 | 81 | 8 157 |
| Wärtsilä | 17 306 978 | 8.8/8.8 | 2 | 7 | 5 055 | 300 | 4 866 |
| Saab | 32 778 098 | 30.0/39.5 | 2 | 6 | 4 622 | 194 | 4 428 |
| Sobi | 107 594 165 | 39.9/40.5 | 2 | 6 | 4 465 | 559 | 3 906 |
| NASDAQ OMX | 19 394 142 | 11.7/11.7 | 2 | 5 | 4 081 | 935 | 3 160 |
| Husqvarna | 97 052 157 | 16.8/30.4 | 2 | 5 | 3 667 | -135 | 3 802 |
| 73 | 204 | 155 215 | 141 456 | ||||
| Subsidiaries | |||||||
| Mölnlycke Health Care | |||||||
| Equity | 98/96 | 6 | 19 | 14 059 | -122 | 14 178 | |
| Mezzanine debt | 1 | 2 | 1 837 | -27 | 1 880 | ||
| Aleris | 98/99 | 2 | 5 | 3 930 | -1 | 3 930 | |
| Grand Hôtel/Vectura | 100/100 | 1 | 2 | 1 254 | -49 | 1 303 | |
| 10 | 28 | 21 080 | 21 291 | ||||
| 83 | 232 | 176 295 | 162 747 | ||||
| Financial Investments | |||||||
| EQT | 5 | 14 | 10 9235) | 144 | 10 984 | ||
| Investor Growth Capital | 5 | 14 | 10 701 | 87 | 10 727 | ||
| Partner-owned investments | |||||||
| Gambro | 48/49 | 3 | 7 | 5 4555) | - | 5 455 | |
| Lindorff | |||||||
| Equity | 58/50 | 2 | 6 | 4 152 | -48 | 4 200 | |
| Mezzanine debt | 0 | 0 | 283 | -1 | 284 | ||
| 3 Scandinavia | 40/40 | 1 | 3 | 2 381 | 14 | 2 367 | |
| Other partner-owned investments | n/a | 0 | 0 | 182 | -4 | 176 | |
| Other Investments6) | 1 | 2 | 1 508 | 204 | 951 | ||
| 17 | 46 | 35 585 | 35 144 | ||||
| Other Assets and Liabilities | 0 | 2 | 1 316 | -428 | |||
| Total Assets | 100 | 280 | 213 196 | 197 463 | |||
| Net debt | -10 | -29 | -22 166 | -22 765 | |||
| Net Asset Value | 90 | 251 | 191 0305) | 174 698 |
1) Holdings, including any shares pledged.
2) Calculated in accordance with the disclosure regulations of Sweden's Financial Instruments Trading Act (LHF). ABB, AstraZeneca, NASDAQ OMX and Wärtsilä in accordance with Swiss, British, U.S. and Finnish regulations.
3) Includes market value of derivatives related to investments if applicable.
4) Valued according to the class of share held by Investor, with the exception of Saab and Electrolux, for which the most actively traded class of share is used. Wärtsilä is valued based on our holding in Avlis AB.
5) Not adjusted for the signed agreement to divest Gambro (page 4 for further information). If Gambro is valued at the transaction value with Baxter, Gambro would have been valued at SEK 8,860 m., EQT at SEK 11,568 m. and total net asset value would be SEK 195,080 m.
6) Includes trading and smaller holdings.
Our total return was 11 percent in the first quarter and the Stockholm Stock Exchange (SIXRX) returned 10 percent. Our net asset value increased by 9 percent.
Some macro concerns erupted yet again and hung like an ash cloud over the European economy. This was hardly surprising and it will take some time before the ash cloud is dissolved. That said, we should not lose sight of the fact that Europe will solve its problem at some point in time. Near-term, uncertainty is prevailing in Asia and Latin America. The U.S. on the other hand, seems to gradually recover. The developments during the quarter provided further support to our focus on promoting flexible business models in our companies rather than spending time trying to predict the general economy. Additionally, while the stock market may go up or down short term, I think it can prove expensive to stay out of it for long-term owners. Times of uncertainty can provide good buying opportunities.
Recurring capital distribution from our core investments is important for us as long-term owners without exit strategy. It is through capital distribution, not exits, that we continuously realize value. We like our companies to pay a dividend that is sustainable and at the same time give them financial flexibility to act on value-creating strategic opportunities. If they are deemed over-capitalized after taking this into account, the capital base can always be adjusted through redemptions or share buy-backs. We expect to receive approximately SEK 5.4 bn. in dividends during 2013, compared to SEK 4.8 bn. last year.
Mölnlycke Health Care continues to perform strongly, although it had some headwind from Easter occurring in March. Also, investments in expanding the sales force, the geographic presence and R&D increased the operating expenses, hampering margins. We intend to refinance Mölnlycke Health Care during the second half of the year. Our ambition is to get an investment grade rating and to raise senior debt. This will lower financing costs, create higher flexibility and enable us to receive cash distributions.
The work to improve Aleris' operations continues. Healthcare in Sweden is still not performing to its potential while the operations in Denmark are gradually improving. Having been a major factor in establishing Aleris as one of the leading care and health care providers in Scandinavia and built a solid platform for future strong development, CEO Stanley Brodén has decided to step down during 2013. This is according to the plan set out when Investor acquired Aleris in 2010. The search for a new CEO is ongoing.
Aleris continues to make long-term investments and is financing research conducted by employees, as a means to develop the business and make more room for staff to develop professionally. As Investor will be deeply engaged in this sector for the long-run, we have also committed to financing a new external professorship in the field of innovative care and processes.
In March, we announced the acquisition of Permobil, a global leader in complex rehab powered wheelchairs for people with functional disabilities. Permobil has a strong corporate culture and a true devotion to improving the life of its end-users. Permobil has strong market positions, profitability and cash conversion.
Our ownership plan for Permobil centers around growth in existing, as well as, new markets. This requires continued investments in sales force expansion and R&D. Permobil's market leadership is built upon strong innovation, and we will continue investing to keep this edge. Over time, growing volumes should support profitability.
We do not have any exit strategy for our subsidiaries. It is through capital distribution that we realize value. We will use a gearing level in Permobil allowing for investments and the pursuit of growth opportunities. We expect the company to generate positive cash flow to equity already from the start, and with a moderate gearing of 3-4x EBITDA, the company has the capacity to distribute cash by 2015.
EQT contributed positively to net asset value with a value increase of 4 percent in constant currency. Investor Growth Capital's value increase was 1 percent.
The filing process to get the Gambro divestiture cleared by regulators is on track. We expect the transaction to close by the end of the second quarter, although slippage cannot be ruled out as it is difficult to exactly forecast how long the regulatory process will take. Total proceeds are expected to be SEK 10.5 bn., of which SEK 9.2 bn. will be received upon closing and the remainder in escrow.
Lindorff continues its strong trend, reaping the benefits of portfolio acquisitions and operational improvements made during the past years. The company has now established a strong market presence in the Nordics, Germany, The Netherlands and Spain. We believe that Lindorff has a good platform in place for future growth. However, there is further potential in improving operational excellence, which could provide additional upside.
The scope of our Financial Investments will not grow over time, but we maintain flexibility to act on attractive investment opportunities. Such investments could eventually turn out to be – indeed, financial investments, and leave the portfolio at some point – or they could become longer-term holdings. Our investment in Active Biotech should be viewed in light of this. We have also transferred two holdings from Investor Growth Capital which we believe are attractive holdings for Investor: Affibody and Atlas Antibodies. Both are based on Swedish, world-leading medical research and are included within our other financial investments.
At the end of the quarter, our leverage was 10.4 percent, slightly above our long-term target range of 5-10 percent. Pro forma, taking the Gambro proceeds (excluding escrow), the investment in Permobil and dividends paid and received into account, our leverage would be 8.5 percent.
Our strategy remains to build our net asset value, operate efficiently and pay a steadily rising dividend over time. I am confident that our portfolio of well-performing companies will allow us to achieve that goal.
Börje Ekholm
During the first quarter, the net asset value increased from SEK 174.7 bn. to SEK 191.0 bn. The change in net asset value was 9 percent during the first quarter (7) 1) . During the same period, the total return on the Stockholm Stock Exchange (SIXRX) was 10 percent.
1) For balance sheet items, figures in parentheses refer to year-end 2012 figures. For income statement items, the figures in parentheses refer to the same period last year.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| Changes in value | 14 123 | 9 265 |
| Dividends | 2 326 | 2 077 |
| Other operating income1) | 126 | 124 |
| Management costs | -90 | -113 |
| Other items2) | -290 | -440 |
| Profit (+)/Loss (-) | 16 195 | 10 913 |
| Non-controlling interest | 8 | 10 |
| Other effects on equity | 129 | 15 |
| Total | 16 332 | 10 938 |
1) Includes interest received on loans to associates.
2) Other items include among other share of results of associates and net financial items.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| Core Investments | 15 837 | 9 779 |
| Financial Investments | 381 | 1 428 |
| Investor groupwide | 114 | -269 |
| Total | 16 332 | 10 938 |
Net debt totaled SEK 22,166 m. on March 31, 2013 (22,765), corresponding to leverage of 10.4 percent (11.5). The average maturity of Investor AB's debt financing is 10.4 years (10.6). There are no maturities before 2016.
| SEK m. | 1/1-3/31 2013 | 1/1-12/31 2012 |
|---|---|---|
| Opening net debt | -22 765 | -16 910 |
| Core Investments | ||
| Dividends | 7511) | 4 782 |
| Net investments | -3 | -6 147 |
| Financial Investments | ||
| Dividends | 113 | 685 |
| Net investments | -222 | 107 |
| Investor groupwide | ||
| Other | -40 | -719 |
| Dividends paid | - | -4 563 |
| Closing net debt | -22 166 | -22 765 |
1) Dividends from listed core investments of SEK 1,565 m. was pending over the end of the quarter and has been accounted for as receivable in Other Assets and Liabilities.
The divestment of Investor's holding in Gambro to Baxter was announced in December 2012, and the transaction is expected to close late in the second quarter 2013, subject to regulatory approval. The value of Gambro, based on the equity method, is reported as assets held for sale and will remain unchanged until the transaction is completed.
Assuming that the divestment had been completed at the agreed enterprise value of SEK 26.5 bn., generating proceeds of SEK 10.5 bn. (of which SEK 1.3 bn. in escrow), as of March 31, 2013, Investor's reported net asset value would have amounted to SEK 195,080 m. (SEK 256 per share), compared to the reported SEK 191,030 m. (SEK 251 per share). Net debt would have been SEK 11,693 m., compared to the reported SEK 22,166 m.
Core Investments contributed to the net asset value with SEK 15,837 m. during the first quarter (9,779). The listed holdings contributed with SEK 16,072 m. (9,802), and the subsidiaries contributed with SEK -199 m. (9).
Read more at www.investorab.com under "Our Investments" >>
SEK 3 m. was invested in the subsidiaries.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| Changes in value, listed | 13 756 | 7 866 |
| Dividends, listed | 2 316 | 1 936 |
| Change in reported value, subsidiaries | -199 | 9 |
| Management cost | -36 | -32 |
| Total | 15 837 | 9 779 |
| Core Investments Overview | |||||
|---|---|---|---|---|---|
| Type of investment | Type of ownership | Valuation methodology | Goal | ||
| Core Investments – Listed |
Well-established, global companies. Long ownership horizon. |
Significant minority ownership for strategic influence. |
Share price (bid) for the class of share held by Investor, in some cases the most actively traded class is used. |
8-9 percent long term annual return. |
|
| Core Investments – Subsidiaries |
Medium- to large-size companies with international operations. Long ownership horizon. |
Majority ownership for strategic influence. |
Subsidiaries are valued according to the acquisition method. |
8-9 percent long term annual return. |
Listed core investments contributed to net asset value with SEK 16,072 m. during the first quarter (9,802). The combined total return for the listed core investments amounted to 11.5 percent during the period.
Read more at www.investorab.com under "Our Investments" >>
No shares were purchased or divested in the first quarter.
Dividends from listed core investments totaled SEK 2,316 m. during the first quarter (1,936), of which SEK 1,565 m. (SEB and Electrolux) was pending and reported in Other Assets and Liabilities. We expect to receive approximately SEK 5.4 bn. in total during 2013.
| Total return for Investor1) 2013 (%) | |
|---|---|
| Atlas Copco | 3.7 |
| SEB | 23.4 |
| ABB | 10.5 |
| AstraZeneca | 9.6 |
| Ericsson | 25.4 |
| Electrolux | 1.0 |
| Wärtsilä | 6.22) |
| Saab | 4.4 |
| Sobi | 14.3 |
| NASDAQ OMX | 29.63) |
| Husqvarna | -3.6 |
1) Calculated as the sum of share price changes and dividends added back, including add-on investments and/or divestments during the period.
2) The corresponding return in EUR terms was 9.7 percent for the period.
3) The corresponding return in USD terms was 29.6 percent for the period.
A global leader in compressors, construction and mining equipment, power tools and assembly systems. The group operates in more than 170 countries.
| Market value, Investor's holding, SEK m. | 37 985 |
|---|---|
| Investor's ownership (capital), % | 16.8 |
| Share of Investor's total assets, % | 18 |
Investor's view: Atlas Copco has world-leading market positions and a strong corporate culture. For quite some time, the company has had best-in-class operational performance and has generated a total return significantly higher than its peers. Over the last few years, Atlas Copco has focused on strengthening its positions in key growth markets such as China, India and Brazil, and on building world class aftermarket operations. These initiatives have been instrumental to the company's strong performance. Going forward, the company's strong market positions, a flexible business model and focus on innovation provide an excellent platform for capturing business opportunities and continuing to outperform its peers. Thanks to its stable cash flow, the company is able to distribute significant capital to shareholders, while simultaneously retaining the flexibility to act on its growth strategy.
Read more at www.abb.com >>
A global leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact.
| Market value, Investor's holding, SEK m. | 26 921 |
|---|---|
| Investor's ownership (capital), % | 7.9 |
| Share of Investor's total assets, % | 13 |
Investor's view: Both the power and automation industries are attractive with large emerging market exposure and structural growth drivers in terms of electricity build-out and an increased focus on energy efficiency. The power market is facing price pressure but ABB is mitigating this through operational efficiencies. ABB is well positioned to benefit from the future growth potential due to its strong brand and market positions. The company was early in establishing a presence in China and India with strong local product offerings. We believe that this is critical to long-term success in these industries. Operational performance has been good and the company has strengthened its position in the automation market through a number of acquisitions. ABB's balance sheet remains healthy, supporting further growth and continued distribution to shareholders.
Read more at www.seb.se >>
A leading Nordic financial services group. SEB is present in some 20 countries, with main focus on the Nordic countries, Germany and the Baltics.
| Market value, Investor's holding, SEK m. | 29 845 |
|---|---|
| Investor's ownership (capital), % | 20.8 |
| Share of Investor's total assets, % | 14 |
Investor's view: SEB continues to focus on sustainable growth within its key growth areas: the Nordic and German corporate franchises, Swedish small and medium-sized enterprises and long-term savings. Accordingly, it should now be able to capitalize on established platforms. Non-core businesses have been divested and earnings stability has improved, alongside a strengthened balance sheet and increased focus on efficiency. While some uncertainty still remains regarding the final global and local regulatory outcome, SEB has proactively increased capitalization and liquidity positions. Our view is that SEB is well prepared to meet the new regulatory requirements.
Read more at www.astrazeneca.com >>
A global, innovation-driven, integrated biopharmaceutical company.
| Market value, Investor's holding, SEK m. | 16 704 |
|---|---|
| Investor's ownership (capital), % | 4.1 |
| Share of Investor's total assets, % | 8 |
Investor's view: AstraZeneca must cope with patent expirations for some of its key products and strengthen its research pipeline. Improved R&D productivity remains the most important driver of long-term value for AstraZeneca and the entire pharmaceutical industry. It is also important that AstraZeneca continues to expand in emerging markets and strives for operational excellence.
The world's leading provider of communications technology and services. Ericsson operates in 180 countries and employs more than 100,000 people.
| Market value, Investor's holding, SEK m. | 13 943 |
|---|---|
| Investor's ownership (capital), % | 5.3 |
| Share of Investor's total assets, % | 6 |
Investor's view: Mobile data traffic is growing significantly in the world's mobile networks and as the global leader in the mobile equipment industry, Ericsson is well positioned to capitalize on this development. As customers' networks are undergoing significant modernizations to meet the demand for mobile data, the industry has become increasingly competitive. For Ericsson to maintain its market position, it needs to sustain its technological leadership and continue to improve its cost and capital efficiency. The services business in Ericsson has developed into a stable and growing business with attractive recurring revenues.
Read more at www.wartsila.com >>
A global leader in complete lifecycle power solutions for the marine and energy markets. The company has operations in nearly 170 locations in 70 countries.
| Market value, Investor's holding, SEK m. | 5 055 |
|---|---|
| Investor's ownership (capital), % | 8.8 |
| Share of Investor's total assets, % | 2 |
Investor's view: Wärtsilä has leading global marketpositions and high emerging market exposure, which provide an excellent platform for profitable growth. To counteract the end-market cyclicality, the company has an assetlight business model focused on the design and development of engines and inhouse manufacturing of critical components. The company also has a sizeable aftermarket business in 70 countries to support both marine and power customers. We support Wärtsilä's current strategy and see good longterm potential driven by environmental regulations, smart power generation and an increased penetration of natural gas-powered engines.
A global leader in household appliances and appliances for professional use, selling more than 40 million products to customers in more than 150 markets every year.
| Market value, Investor's holding, SEK m. | 7 927 |
|---|---|
| Investor's ownership (capital), % | 15.5 |
| Share of Investor's total assets, % | 4 |
Investor's view: The global appliances industry is highly competitive due to low growth in mature markets and a tough industry structure. Growth in emerging markets is high, supported by a fast growing middle class and increased appliance penetration. Industry margins are low, but returns are nevertheless healthy thanks to high capital turnover. Electrolux is the second largest global appliance company with strong presence across the globe. In recent years, Electrolux has strengthened its positions in emerging markets through organic growth as well as acquisitions. The company is successfully executing its strategy and we see good potential for a higher long-term operating margin based on the ongoing strategic initiatives. To achieve a higher margin, it is critical to improve performance in the important European market.
Read more at www.saabgroup.com >>
Serves the global market with world-leading products, services and solutions for military defense and civil security.
| Market value, Investor's holding, SEK m. | 4 622 |
|---|---|
| Investor's ownership (capital), % | 30.0 |
| Share of Investor's total assets, % | 2 |
Investor's view: Saab provides state-of-the-art products and is well positioned in many niche markets globally. The Swedish government is still the largest customer and with decreasing Swedish defense spending over the last decade, Saab has focused on developing cost efficient products. Growth outside of Sweden continues to be imperative, and with pressure on defense budgets in most parts of the world, Saab's cost competitive product portfolio becomes increasingly attractive. Focus continues to be on operational efficiency to be able to support internal R&D investments and marketing efforts in international markets, thereby creating a strong platform for the future.
Read more at www.sobi.com >>
A leading integrated biopharmaceutical company with international market presence, developing and commercializing pharmaceuticals for patients with rare diseases.
| Market value, Investor's holding, SEK m. | 4 465 |
|---|---|
| Investor's ownership (capital), % | 39.9 |
| Share of Investor's total assets, % | 2 |
Investor's view: Near-term, continuing to improve operational performance and extending the life of the existing products and commercial agreements are the main drivers for Sobi's business. During 2012, Sobi reported positive phase III data for its two hemophilia products under development. Longer term, securing the full commercial potential of Sobi's hemophilia assets is the key focus for the company.
Read more at www.husqvarnagroup.com >>
The world's largest producer of outdoor power products for garden, park and forest care, European leader in watering products, and a world leader in cutting equipment and diamond tools to the construction industry.
| Market value, Investor's holding, SEK m. | 3 667 |
|---|---|
| Investor's ownership (capital), % | 16.8 |
| Share of Investor's total assets, % | 2 |
Investor's view: Total shareholder return for Husqvarna since the spin-off from Electrolux has been below expectations. The company has been negatively impacted by weak markets for outdoor products and an unsatisfactory operational performance in North America. However, we still believe in Husqvarna's long-term potential based on its world-leading market positions, strong brands and global sales organization. The company is addressing its current problems and has recently announced actions to improve the operational performance and reduce its fixed cost base. Nearterm, it is important to turn around the North American business.
One of the world's largest exchange operators, which offers listings, trading, exchange technology and public company services across six continents.
| Market value, Investor's holding, SEK m. | 4 081 |
|---|---|
| Investor's ownership (capital), % | 11.7 |
| Share of Investor's total assets, % | 2 |
Investor's view: NASDAQ OMX has strong market positions and a unique brand in an industry that we know well. An exchange is at the core of the financial system's infrastructure and we believe that more financial products will become traded on exchanges. Our view is that continued focus on capturing growth opportunities, such as expansion into new asset classes and adjacent businesses, should create value. The company's strong cash flow supports continued growth initiatives as well as shareholder cash distributions.
The subsidiaries contributed to the net asset value with SEK -199 m. during the first quarter (9). The reported net asset value of Mölnlycke Health Care was impacted by SEK -405 m. in foreign exchange rate related effects.
Read more at www.investorab.com under "Our Investments" >>
On March 27, 2013, Investor signed an agreement to acquire Permobil, a global leader in advanced powered wheelchairs, for an enterprise value of SEK 5.1 bn. Investor expects to inject SEK 3.7 bn. in equity and the transaction is expected to close during the second quarter, subject to customary regulatory approval.
Investor invested SEK 3 m. in Mölnlycke Health Care.
| 3/31 2013 | 12/31 2012 | |||
|---|---|---|---|---|
| SEK/share | SEK m. | SEK/share | SEK m. | |
| Mölnlycke Health Care | ||||
| Equity | 19 | 14 059 | 19 | 14 178 |
| Mezzanine debt | 2 | 1 837 | 2 | 1 880 |
| Aleris | 5 | 3 930 | 5 | 3 930 |
| Grand Hôtel/Vectura | 2 | 1 254 | 2 | 1 303 |
| Total | 28 | 21 080 | 28 | 21 291 |
| SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|
| Mölnlycke Health Care | -1491) | 161) |
| Aleris | -12) | 122) |
| Grand Hôtel/Vectura | -49 | -19 |
| Total | -199 | 9 |
1) Affected by SEK -136 m. deriving from acquisition related amortizations on intangible assets (-139) and SEK -405 m. in negative exchange rate related effects (-148).
2) Affected by SEK -31 m. deriving from acquisition related amortizations on intangible assets (-35).
Read more at www.molnlycke.com >>
A world-leading manufacturer of single-use surgical and wound care products and services for the professional health care sector.
The Wound Care division generated good growth in the quarter. Advanced Wound Care continued to deliver strong growth, especially in North America. Some European markets delivered good growth while others were impacted by reduced healthcare spending.
The Surgical division had a stable quarter in difficult market conditions with ProcedurePak® and Staff Clothing continuing to deliver good growth.
| Income statement items, EUR m. | Q1 2013 | Q1 2012 | Rolling 4 quarters |
|---|---|---|---|
| Sales | 277 | 267 | 1 129 |
| Sales growth, % | 4 | 9 | |
| Sales growth, constant currency, % | 4 | 6 | |
| EBITDA | 74 | 71 | 324 |
| EBITDA, % | 27 | 27 | 29 |
| Balance sheet items, EUR m. | 3/31 2013 | 12/31 2012 | |
| Net debt | 1 399 | 1 383 | |
| Cash flow items, EUR m. | Q1 2013 | Q1 2012 | |
| EBITDA | 74 | 71 | |
| Change in working capital | -38 | -26 | |
| Capital expenditures | -12 | -8 | |
| Operating cash flow | 24 | 37 | |
| Acquisitions/divestments | - | -18 | |
| Shareholder contribution/distribution | - | - | |
| Other1) | -40 | -37 | |
| Increase(-)/decrease (+) in net debt | -16 | -18 | |
| Key ratios | Rolling 4 quarters |
||
| Working capital/sales, % | 13 | ||
| Capital expenditures/sales, % | 5 | ||
| 3/31 2013 | 3/31 2012 | ||
| Number of employees | 7 265 | 6 750 |
1) Includes effects of exchange rate changes, interest, tax and other non-cash items.
| Initial investment year | 2007 |
|---|---|
| Total capital invested, SEK m. | |
| Equity, SEK m. | 11 442 |
| Mezzanine debt, SEK m. | 1 743 |
| Investor's ownership (capital), % | 98 |
| Share of Investor's total assets, % | 7 |
| Reported value, Investor's share, SEK m. | |
| Equity, SEK m. | 14 059 |
| Mezzanine debt, SEK m. | 1 837 |
Investor's view: Mölnlycke Health Care is a true leader in its industry segments. Historically, the company has delivered strong growth and outperformed most of its key peers in terms of growth, profitability and cash conversion. The company has a highly competitive product portfolio with leading positions in key addressable end-markets. Continued focus on product innovation, investments in marketing/sales in existing markets, and geographic expansion into new markets will drive future growth.
Read more at www.aleris.se >>
A leading private provider of health care and care services in the Nordic region.
| Income statement items, SEK m. | Q1 2013 | Q1 2012 | Rolling 4 quarters |
|---|---|---|---|
| Sales | 1 756 | 1 656 | 6 832 |
| Sales growth, % | 6 | 55 | |
| Organic growth, constant currency, % | 6 | 11 | |
| EBITDA | 85 | 130 | 285 |
| EBITDA, % | 5 | 8 | 4 |
| Balance sheet items, SEK m. | 3/31 2013 | 12/31 2012 | |
| Net debt | 2 190 | 2 161 | |
| Cash flow items, SEK m. | Q1 2013 | Q1 2012 | |
| EBITDA | 85 | 130 | |
| Change in working capital | -90 | -40 | |
| Capital expenditures | -39 | -29 | |
| Operating cash flow | -44 | 61 | |
| Acquisitions/divestments | - | -40 | |
| Shareholder contribution/distribution | - | 300 | |
| Other1) | 15 | -42 | |
| Increase(-)/decrease (+) in net debt | -29 | 279 | |
| Key ratios | Rolling 4 quarters |
||
| Working capital/sales, % | -2 | ||
| Capital expenditures/sales, % | 3 | ||
| 3/31 2013 | 3/31 2012 | ||
| Number of employees | 5 995 | 5 360 |
1) Includes effects of exchange rate changes, interest, tax and other non-cash items.
| Initial investment year | 2010 |
|---|---|
| Capital invested, SEK m. | 4 341 |
| Investor's ownership (capital), % | 98 |
| Share of Investor's total assets, % | 2 |
| Reported value, Investor's share, SEK m. | 3 930 |
Investor's view: The Scandinavian healthcare and care market offers longterm sustainable growth potential, where private providers can outgrow the overall market given the ongoing long-term outsourcing and deregulation trend. Aleris has a strong market position and an attractive platform for growth. Near-term, however, focus should be on integrating recent acquisitions and improving the performance within units currently operating unsatisfactory. Delivering high-quality and cost-efficient service is the main differentiating and sustainable factor for this business over the long-term, which is why efforts to constantly improve quality and service for patients and payers are the top priority.
Read more at www.grandhotel.se >>
Scandinavia's leading five-star hotel, opened in 1874. It occupies a landmark building with a unique location on the waterfront in central Stockholm.
| Income statement items, SEK m. | Q1 2013 | Q1 20121) | Rolling 4 quarters1) |
|---|---|---|---|
| Sales | 73 | 76 | 380 |
| Sales growth, % | -4 | ||
| EBITDA | -15 | -7 | -8 |
| EBITDA, % | -21 | -9 | -2 |
| 3/31 2013 | 3/31 2012 | ||
| Number of employees | 220 | 245 |
1) Pro forma. As of the fourth quarter 2012, the Grand Hôtel operations were split between Grand Hôtel and Vectura.
Investor's view: Grand Hôtel has a unique brand and location. In recent years, wide-scale renovations have been made to the hotel, new facilities have been opened and various initiatives have been implemented in order to cope with the challenging economic climate. It is important that Grand Hôtel continues to develop its offering, reach new customer segments, increase the occupancy rate, and focus on efficiency, without compromising its status as a superior hotel.
| Investor's ownership (capital), % | 100 |
|---|---|
| Share of Investor's total assets, % | 1 |
| Reported value, Investor's share, SEK m. | 1 254 |
| Net debt, Vectura & Grand Hôtel, SEK m. | 876 |
Brief facts: Through Vectura, a wholly-owned subsidiary of Investor, Investor has consolidated its various real estate assets in order to operate them more efficiently. Grand Hôtel's hotel operations are managed and reported separately. The reported value and net debt are reported for Vectura and Grand Hôtel as a combined entity.
Managing real estate in Sweden, including Investor's office, Näckström Fastigheter (operates real estate related to Aleris), Blasieholmen 54 (The Grand Hôtel property) and other land and real estate.
| Income statement items, SEK m. | Q1 2013 | Q1 20121) | Rolling 4 quarters1) |
|---|---|---|---|
| Sales | 20 | 23 | 113 |
| Sales growth, % | -13 | ||
| EBITDA | 5 | 14 | 49 |
| EBITDA, % | 25 | 61 | 43 |
1) Pro forma. Vectura was formed as of the fourth quarter 2012.
Investor's view: With all the properties within the Investor group concentrated into one unit, Vectura can provide efficient real estate management and realize synergies. Näckström Fastigheter, focusing on real estate projects related to Aleris, allows Aleris to focus on its core business in well-adapted facilities. Over time, the number of projects is likely to grow gradually as Aleris expands and relocates parts of its operations.
Financial Investments contributed to the net asset value with SEK 381 m. value during the first quarter (1,428).
Read more at www.investorab.com under "Our Investments" >>
First quarter
SEK 802 m. was invested and SEK 693 m. received in proceeds.
Investor subscribed for SEK 270 m. in a directed new issue in Active Biotech, paying SEK 45 per share for 6.0 million shares. Investor's ownership amounts to 8.0 percent of the capital and votes. Investor also acquired Investor Growth Capital's holdings in Atlas Antibodies and Affibody. These holdings are reported within Other.
On December 4, 2012, Investor (49 percent) and EQT (51 percent), signed an agreement to divest Gambro to the medical technology company Baxter International Inc. for an agreed total enterprise value of SEK 26.5 bn. According to the agreement, Gambro's equity value will be based on the enterprise value after deduction of the net debt at the closing of the transaction.
The impact on Investor's net asset value is estimated at SEK 4.0 bn., of which SEK 3.4 bn. from the direct ownership in Gambro and SEK 0.6 bn. through the ownership in the EQT IV fund. Total proceeds to Investor will be approximately SEK 10.5 bn., of which SEK 1.3 bn. in escrow. The transaction is subject to approval from the relevant competition authorities and is expected to be completed late in the second quarter 2013.
| 3/31 2013 | 12/31 2012 | |||
|---|---|---|---|---|
| SEK/Share | SEK m. | SEK/Share | SEK m. | |
| EQT | 14 | 10 923 | 15 | 10 984 |
| Investor Growth Capital | 14 | 10 701 | 14 | 10 727 |
| Partner-owned | ||||
| Gambro | 7 | 5 4551) | 7 | 5 455 |
| Lindorff | ||||
| Equity | 6 | 4 152 | 6 | 4 200 |
| Mezzanine debt | 0 | 283 | 0 | 284 |
| 3 Scandinavia | 3 | 2 381 | 3 | 2 367 |
| Other Partner-owned | 0 | 182 | 176 | |
| Other2) | 2 | 1 508 | 1 | 951 |
| Total | 46 | 35 585 | 46 | 35 144 |
1) The value of Gambro is reported as assets held for sale, and will remain unchanged
from the date of the divestment agreement until the transaction is completed. 2) Includes trading and smaller holdings, e.g. Active Biotech, Affibody, Atlas Antibodies and Newron.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| EQT | 144 | 495 |
| Investor Growth Capital | 87 | 651 |
| Partner-owned | ||
| Gambro | - | -13 |
| Lindorff | -49 | 35 |
| 3 Scandinavia | 14 | -13 |
| Other partner-owned | -4 | 0 |
| Other | 204 | 291 |
| Management cost | -15 | -18 |
| Total | 381 | 1 428 |
| Business Area Overview | ||||||||
|---|---|---|---|---|---|---|---|---|
| Type of investment | Type of ownership | Valuation methodology | Goal | |||||
| Financial Investments |
EQT | Largest investor in EQT's funds. | Unlisted holdings at multiple or third-party valuation, listed shares at share price (bid). |
15 percent annual return on average for the business area. |
||||
| Investor Growth Capital | Leading minority ownership in expansion stage companies. |
Unlisted holdings at multiple or third-party valuation, listed shares at share price (bid). |
||||||
| Partner-owned investments | Significant minority ownership for strategic influence. |
Equity method. Income and balance sheet items reported with one month's delay. |
The EQT private equity funds invest in companies in Northern and Eastern Europe, Asia and the U.S., in which EQT can act as a catalyst to transform and grow operations.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| Net asset value, beginning of period | 10 984 | 13 214 |
| Contribution to net asset value (value change) | 144 | 495 |
| Draw-downs (investments and management fees) | 375 | 311 |
| Proceeds to Investor (divestitures, fee surplus and | ||
| carry) | -580 | -1 711 |
| Net asset value at end of period | 10 923 | 12 309 |
As of March 31, 2013, the five largest investments were (in alphabetical order): Gambro (Sweden), ISS (Denmark), LBX (China), Sanitec (Finland), and Springer (Germany), representing 39 percent of the total value of Investor's investments in EQT funds.
| Initial investment year | 1994/1995 |
|---|---|
| Investor's share of funds, % | 6-64 |
| Market value, Investor's holding, SEK m. | 10 923 |
| Share of Investor's total assets, % | 5 |
Investor's view: Investor has been a sponsor of EQT's funds since its inception almost 20 years ago. Since then, EQT has delivered top investment performance in its industry and we have received returns on our limited partner interest in the top quartile of the industry. As a sponsor, we also have an ownership interest in the general partners of the funds, allowing us to capture a portion of both the carry and surplus from management fees. This represents a significant enhancement of our total return from the respective funds over time. Although "lumpy" by nature, depending on whether the funds are in an investment or divestment phase, our investments in the EQT funds are expected to continue to generate strong cash flow.
Read more at www.eqt.se >> Read more at www.investorgrowthcapital.com >>
Investor Growth Capital (IGC) makes expansion stage venture capital investments in growth companies within technology and healthcare in the U.S. and China.
| SEK m. | Q1 2013 | Q1 2012 |
|---|---|---|
| Net asset value, beginning of period | 10 727 | 10 188 |
| Contribution to net asset value (value change) | 87 | 651 |
| Capital contribution from Investor | - | 750 |
| Distribution to Investor | -113 | -257 |
| Net asset value at end of period | 10 701 | 11 332 |
| Of which net cash | 2 085 | 2 395 |
As of March 31, 2013, the U.S., Asian and European portfolios represented 74, 12 and 14 percent of the total value, excluding net cash. 26 percent of the market value was composed by listed holdings. Cash represented 19 percent of IGC's net asset value.
The five largest investments were (in alphabetical order): Aerocrine (Sweden), Aptalis (U.S.), China Greens (China), Greenway Medical Technologies (U.S.) and Mindjet Corporation (U.S.). In total, these holdings represented 29 percent of the total portfolio value, excluding net cash.
| 1995 |
|---|
| 100 |
| 10 701 |
| 5 |
Investor's view: With its new structure and focus on the U.S. and China, where the track record and return prospects are strongest, IGC has a solid platform for continued strong performance. The structural change leads to a clarified capital commitment from Investor and also creates the basis for a more sustainable cash flow to us.
A global medical technology company and a leader in developing, manufacturing and supplying products and therapies for kidney and liver dialysis, myeloma kidney therapy and other extracorporeal therapies for chronic and acute patients.
| Q1 2013 | Q1 2012 | Rolling 4 | ||
|---|---|---|---|---|
| Income statement items, SEK m. | (Dec-Feb) | (Dec-Feb) | quarters | |
| Sales | 2 693 | 2 716 | 10 813 | |
| Sales growth, % | -1 | -3 | ||
| Sales growth, constant currency, % | 2 | -5 | ||
| Normalized EBITDA | 335 | 318 | 1 693 | |
| Normalized EBITDA, % | 12 | 12 | 16 | |
| Balance sheet items, SEK m. | Q1 2013 | Q4 2012 | ||
| Net debt | 8 306 | 8 090 | ||
| Q1 2013 | Q1 2012 | |||
| Number of employees | 7 735 | 7 075 | ||
1) Income statement and balance sheet items are reported with one month's delay.
| Initial investment year | 2006 |
|---|---|
| Capital invested, SEK m. | 4 622 |
| Investor's ownership (capital), % | 48 |
| Share of Investor's total assets, % | 3 |
| Reported value, Investor's share, SEK m. | 5 455 |
Investor's view: The restructuring of Gambro has been challenging and taken longer than we originally anticipated. During the past couple of years however, Gambro has taken important steps to ensure operational efficiency and strengthen the focus on its core activities, especially following the launch of the new strategic plan in early 2012. We continue to believe that the improvement potential, both when it comes to revenue growth and margins, is substantial.
A leading European provider of debt-related administrative services. The company has operations in Denmark, Estonia, Finland, Germany, Latvia, Lithuania, The Netherlands, Norway, Russia, Spain and Sweden.
| Income statement items, EUR m. | Q1 2013 (Dec-Feb) |
Q1 2012 (Dec-Feb) |
Rolling 4 quarters |
|---|---|---|---|
| Sales | 103 | 842) | 397 |
| Sales growth, % | 22 | -1 | |
| Sales growth, constant currency, % | 20 | 1 | |
| EBITdA3) | 33 | 202) | 129 |
| EBITdA3) , % |
32 | 24 | 33 |
| Balance sheet items, EUR m. | Q1 2013 | Q4 2012 | |
| Net debt | 758 | 764 | |
| Q1 2013 | Q1 2012 | ||
| Number of employees | 2 620 | 2 460 |
1) Income statement and balance sheet items are reported with one month's delay.
2) Including impairment write-downs of EUR 9.3 m. in Q1 2012
3) EBITdA = EBITDA after portfolio depreciation.
| Initial investment year | 2008 |
|---|---|
| Capital invested, SEK m. | |
| Equity, SEK m. | 3 735 |
| Mezzanine debt, SEK m. | 234 |
| Investor's ownership (capital) (given conversion), % | 58 |
| Share of Investor's total assets, % | 2 |
| Reported value, Investor's share, SEK m. | |
| Equity, SEK m. | 4 152 |
| Mezzanine debt, SEK m. | 283 |
Investor's view: Lindorff has a good business mix with its two business areas, Collection and Capital. Collection's service-driven business model has low capital requirements and provides a stable earnings base. Capital has the capacity and ability to pursue portfolio acquisitions with good yield. The growth rate can be adapted to Lindorff's growth ambitions and market opportunities. We expect Lindorff to act on value creating opportunities in Europe. Internally, Lindorff should continue to focus on improving efficiency and operational excellence, as well as integrating recently made acquisitions. We remain confident in Lindorff's long-term growth potential.
A mobile operator providing mobile voice and broadband services in Sweden and Denmark. The company has more than two million subscribers and is recognized for its high-quality network.
| Q1 2013 | Q1 2012 | Rolling 4 quarters |
|
|---|---|---|---|
| Income statement items | (Dec-Feb) | (Dec-Feb) | |
| Sales, SEK m. | 2 442 | 2 260 | 9 523 |
| Sweden, SEK m. | 1 615 | 1 490 | 6 461 |
| Denmark, DKK m. | 719 | 645 | 2 635 |
| Sales growth, % | 8 | 7 | |
| Sweden | 8 | 14 | |
| Denmark | 11 | -4 | |
| EBITDA, SEK m. | 491 | 493 | 2 423 |
| Sweden, SEK m. | 329 | 327 | 1 714 |
| Denmark, DKK m. | 140 | 139 | 610 |
| EBITDA, % | 20 | 22 | 25 |
| Sweden | 20 | 22 | 27 |
| Denmark | 19 | 22 | 23 |
| Balance sheet items, SEK m. | Q1 2013 | Q4 2012 | |
| Net debt | 10 184 | 9 652 | |
| Q1 2013 | Q1 2012 | ||
| Number of employees | 1 980 | 1 9702) | |
| Other Key figures3) | 3/31 2013 | 3/31 2012 | |
| Subscribers | 2 488 000 | 2 236 000 | |
| Sweden | 1 593 000 | 1 428 000 | |
| Denmark | 895 000 | 808 000 | |
| ARPU4) , SEK |
272 | 306 | |
| Sweden, SEK Denmark, DKK |
296 199 |
304 254 |
|
| Non-voice ARPU4) , % |
45 | 46 |
1) Income statement and balance sheet items are reported with one month's delay.
2) Restated
3) Other key figures are reported without delay.
4) Average Monthly Revenue Per User (ARPU) refers to the past 12-month period.
| Initial investment year | 1999 |
|---|---|
| Capital invested, SEK m. | 6 366 |
| Investor's ownership (capital), % | 40 |
| Share of Investor's total assets, % | 1 |
| Reported equity value, Investor's share, SEK m. | 2 381 |
Investor's view: Over the past few years, 3 Scandinavia's strategic focus on building a high-quality mobile network has proven successful, as illustrated by strong subscriber intake and improved operating performance. With strong cost control in place, growth remains the key value driver, and 3 Scandinavia should continue to increase its market share and capture additional growth opportunities. With its spectrum portfolio and high-quality network, the company is well positioned to continue growing. Future revenue and profit growth should translate into enhanced cash flow generation.
| Q1 | FY | Q4 | Q3 | Q2 | Q1 | FY | Q4 | Q3 | Q2 | Q1 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2013 | 2012 | 2012 | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2011 | |
| Core Investments – Subsidiaries | |||||||||||
| Mölnlycke Health Care (EUR m.) | |||||||||||
| Sales | 277 | 1 119 | 294 | 279 | 279 | 267 | 1 014 | 267 | 250 | 253 | 244 |
| EBITDA1) | 74 | 321 | 89 | 81 | 80 | 71 | 296 | 82 | 76 | 71 | 67 |
| EBITDA (%) | 27 | 29 | 30 | 29 | 29 | 27 | 29 | 31 | 30 | 28 | 27 |
| Net debt | 1 399 | 1 383 | 1 383 | 1 450 | 1 488 | 1 500 | 1 482 | 1 482 | 1 506 | 1 527 | 1 578 |
| Employees | 7 265 | 7 175 | 7 175 | 7 170 | 7 175 | 6 750 | 6 755 | 6 755 | 6 835 | 6 880 | 6 985 |
| Aleris (SEK m.) | |||||||||||
| Sales | 1 756 | 6 732 | 1 779 | 1 569 | 1 728 | 1 656 | 5 123 | 1 593 | 1 334 | 1 125 | 1 071 |
| EBITDA | 85 | 330 | 58 | 38 | 104 | 130 | 410 | 138 | 103 | 88 | 81 |
| EBITDA (%) | 5 | 5 | 3 | 2 | 6 | 8 | 8 | 9 | 8 | 8 | 8 |
| Net debt | 2 190 | 2 161 | 2 161 | 2 684 | 2 586 | 2 532 | 2 811 | 2 811 | 2 630 | 2 233 | 1 997 |
| Employees | 5 995 | 6 010 | 6 010 | 5 955 | 5 785 | 5 360 | 5 150 | 5 150 | 4 975 | 4 865 | 3 825 |
| Grand Hôtel2) (SEK m.) | |||||||||||
| Sales | 73 | 383 | 112 | 95 | 100 | 76 | 388 | 120 | - | - | - |
| EBITDA | -15 | 0 | 2 | 1 | 4 | -7 | 25 | 18 | - | - | - |
| EBITDA (%) | -21 | 0 | 2 | 1 | 4 | -9 | 6 | 15 | - | - | - |
| Employees | 220 | 265 | 265 | 255 | 255 | 245 | 260 | 260 | - | - | - |
| Vectura2) (SEK m.) | |||||||||||
| Sales | 20 | 116 | 30 | 32 | 31 | 23 | 99 | 28 | - | - | - |
| EBITDA | 5 | 58 | 15 | 19 | 10 | 14 | 47 | 7 | - | - | - |
| EBITDA (%) | 25 | 50 | 50 | 59 | 32 | 61 | 48 | 25 | - | - | - |
| Net debt (Grand Hôtel & Vectura) | 876 | 820 | 820 | - | - | - | - | - | - | - | - |
| Financial Investments | |||||||||||
| EQT (SEK m.) | |||||||||||
| Reported value | 10 923 | 10 984 | 10 984 | 11 267 | 12 624 | 12 309 | 13 214 | 13 214 | 13 162 | 14 753 | 13 416 |
| Reported value change, % | 1 | 0 | -1 | -5 | 1 | 4 | 31 | -1 | 0 | 15 | 14 |
| Value change, constant currency, % | 4 | 3 | -2 | -2 | 2 | 5 | 31 | 1 | -2 | 13 | 16 |
| Draw-downs from Investor | 375 | 1 284 | 90 | 707 | 176 | 311 | 2 515 | 325 | 306 | 836 | 1 048 |
| Proceeds to Investor | 580 | 3 460 | 303 | 1 414 | 32 | 1 711 | 3 519 | 120 | 1 903 | 1 484 | 12 |
| Investor Growth Capital (SEK m.) | |||||||||||
| Reported value | 10 701 | 10 727 | 10 727 | 10 827 | 11 445 | 11 369 | 10 225 | 10 225 | 10 291 | 8 734 | 8 422 |
| Reported value change, % | 1 | 4 | 0 | -4 | 2 | 6 | 10 | 2 | 10 | -2 | 0 |
| Value change, constant currency, % | 1 | 9 | 0 | 1 | -3 | 10 | 6 | 1 | 4 | -3 | 5 |
| Capital contribution from Investor | - | 750 | - | - | - | 750 | 1 137 | - | 1 137 | - | - |
| Distribution to Investor | 113 | 607 | 81 | 155 | 114 | 257 | 674 | 229 | 445 | - | - |
| Partner-owned investments | |||||||||||
| Gambro3) (SEK m.) | |||||||||||
| Sales | 2 693 | 10 836 | 2 698 | 2 658 | 2 764 | 2 716 | 10 928 | 2 732 | 2 667 | 2 720 | 2 809 |
| Normalized EBITDA | 335 | 1 676 | 442 | 409 | 507 | 318 | 2 041 | 477 | 496 | 548 | 520 |
| Normalized EBITDA (%) | 12 | 15 | 16 | 15 | 18 | 12 | 19 | 17 | 19 | 20 | 19 |
| Net debt4) | 8 306 | 8 090 | 8 090 | 7 867 | 9 417 | 8 606 | 8 572 | 8 572 | 8 169 | 7 806 | 23 592 |
| Employees | 7 735 | 7 410 | 7 410 | 7 165 | 7 095 | 7 075 | 7 205 | 7 205 | 7 270 | 7 335 | 7 380 |
| Lindorff 3) (EUR m.) | |||||||||||
| Sales | 103 | 378 | 97 | 103 | 94 | 84 | 337 | 81 | 84 | 87 | 85 |
| EBITdA5) | 33 | 116 | 28 | 44 | 24 | 20 | 96 | 21 | 31 | 22 | 22 |
| EBITdA5) (%) | 32 | 31 | 29 | 43 | 26 | 24 | 28 | 26 | 37 | 25 | 26 |
| Net debt | 758 | 764 | 764 | 792 | 795 | 680 | 669 | 669 | 661 | 680 | 689 |
| Employees | 2 620 | 2 680 | 2 680 | 3 010 | 2 950 | 2 460 | 2 470 | 2 470 | 2 595 | 2 550 | 2 485 |
| 3 Scandinavia3) | |||||||||||
| Sales | 2 442 | 9 341 | 2 461 | 2 113 | 2 507 | 2 260 | 8 911 | 2 337 | 2 270 | 2 197 | 2 107 |
| Sweden, SEK m. | 1 615 | 6 336 | 1 666 | 1 386 | 1 794 | 1 490 | 5 762 | 1 529 | 1 480 | 1 449 | 1 304 |
| Denmark, DKK m. | 719 | 2 561 | 689 | 635 | 592 | 645 | 2 605 | 655 | 648 | 629 | 673 |
| EBITDA | 491 | 2 425 | 683 | 651 | 598 | 493 | 2 397 | 565 | 595 | 628 | 609 |
| Sweden, SEK m. | 329 | 1 712 | 478 | 458 | 449 | 327 | 1 781 | 398 | 478 | 489 | 416 |
| Denmark, DKK m. | 140 | 609 | 179 | 167 | 124 | 139 | 511 | 125 | 96 | 123 | 167 |
| EBITDA, % | 20 | 26 | 28 | 31 | 24 | 22 | 27 | 24 | 26 | 29 | 29 |
| Sweden | 20 | 27 | 29 | 33 | 25 | 22 | 31 | 26 | 32 | 34 | 32 |
| Denmark | 19 | 24 | 26 | 26 | 21 | 22 | 20 | 19 | 15 | 20 | 25 |
| Net debt, SEK m. | 10 184 | 9 652 | 9 652 | 9 841 | 10 391 | 10 353 | 10 472 | 10 472 | 10 333 | 10 408 | 10 241 |
| Employees | 1 980 | 1 980 | 1 980 | 2 220 | 2 185 | 1 970 | 1 930 | 1 930 | 2 280 | 2 265 | 2 255 |
1) Excluding the purchase price allocation, performed in conjunction with the acquisition of the majority in Mölnlycke Health Care, allocating EUR 49 m. to inventory. The consumption of this market value impacted EBITDA negatively by EUR 4 m. during the fourth quarter 2010 and EUR 45 m. during the first quarter 2011.
2) Numbers up until the first quarter 2013 pro forma, see page 12.
3) Income and balance sheet items are reported with one month's delay.
4) Net debt reported under Gambro Holding until the second quarter 2011.
5) EBITdA=EBITDA after portfolio depreciation.
Net debt totaled SEK 22,166 m. on March 31, 2013 (22,765). Debt financing of the subsidiaries within Core Investments and the partner-owned investments within Financial Investments, is arranged on an independent ringfenced basis and hence not included in Investor's net debt. Investor guarantees SEK 4.2 bn. of 3 Scandinavia's external debt, which is not included in Investor's net debt.
| SEK m. | Consolidated balance sheet |
Deductions related to Core Investments subsidiaries and IGC1) |
Investor's net debt |
|---|---|---|---|
| Other financial instruments |
2 389 | -129 | 2 2602) |
| Cash, bank and short term investments |
8 573 | - 2 935 | 5 6382) |
| Receivables included in net debt |
549 | -2 | 5473) |
| Loans | -44 486 | 14 080 | -30 4063) |
| Provision for pensions | -722 | 517 | -2053) |
| Total | -33 697 | 11 531 | -22 166 |
1) IGC does not have any debt. Cash is excluded in Investor's net debt.
2) Included in cash and readily available placements.
3) Included in gross debt.
Investor's cash and readily available placements amounted to SEK 7,898 m. as of March 31, 2013 (7,697). The shortterm investments are invested conservatively, taking into account the risk-adjusted return profile. Gross debt excluding pensions for Investor amounted to SEK 29,859 m. at the end of the period (30,253).
The average maturity of the debt portfolio was 10.4 years on March 31, 2013 (10.6), excluding the debt of Mölnlycke Health Care, Aleris and Grand Hôtel/Vectura.
| SEK m. | Group - net financial items |
Deductions related to Core Investments subsidiaries |
Investor's net financial items |
|---|---|---|---|
| Interest income | 41 | -3 | 38 |
| Interest expenses | -485 | 225 | -260 |
| Unrealized result from revaluation of loans, swaps and short-term investments |
31 | - | 31 |
| Foreign exchange result | -177 | 76 | -101 |
| Other | -39 | 20 | -19 |
| Total | -629 | 318 | -311 |
The foreign exchange result consists primarily of unrealized currency translation differences from loans to Lindorff and Mölnlycke Health Care.
| SEK m. | Q1 2013 | Q1 2012 | 2012 |
|---|---|---|---|
| Core Investments | 36 | 32 | 139 |
| Financial Investments | 15 | 18 | 69 |
| Investor groupwide | 39 | 63 | 169 |
| Total | 90 | 113 | 377 |
Read more at www.investorab.com under "Investors & Media" >>
The price of the Investor A-share and B-share was SEK 184.40 and SEK 188.20 respectively on March 31, 2013, compared to SEK 165.80 and SEK 170.00 on December 31, 2012.
The total shareholder return on the Investor share amounted to 11 percent during first quarter 2013 (14).
The total market capitalization of Investor, adjusted for repurchased shares, was SEK 142,132 m. as of March 31, 2013 (128,048).
Investor's share capital amounted to SEK 4,795 m. on March 31, 2013 (4,795).
| Class of share |
Number of shares |
Number of votes |
% of capital |
% of votes |
|---|---|---|---|---|
| A 1 vote | 311 690 844 | 311 690 844 | 40.6 | 87.2 |
| B 1/10 vote | 455 484 186 | 45 548 418 | 59.4 | 12.8 |
| Total | 767 175 030 | 357 239 262 | 100.0 | 100.0 |
On March 31, 2013, Investor owned a total of 5,661,562 of its own shares (6,248,054). The decrease in holdings of own shares is attributable to transfer of shares and options within Investors long-term variable remuneration program.
The Parent Company's result after financial items was SEK 14,802 m. (9,630). The result is mainly related to listed Core Investments which contributed to the result with dividends amounting to SEK 2,188 m. (1,936) and value changes of SEK 12,646 m. (7,834). During the quarter, the Parent Company invested SEK 4,639 m. in financial assets (1,743), of which SEK 4,607 m. in Group companies (1,670) and purchases in listed Core Investments of SEK - m. (34). By the end of the period, shareholder's equity totaled SEK 176,220 m. (161,349).
The main risks that the Group and the Parent Company are exposed to are related to the value changes of the listed assets due to market price fluctuations. The development of the global economy is an important uncertainty factor in assessment of near-term market fluctuations. The uncertain market situation also affects the various unlisted holdings' opportunities for new investments and divestments. The development of the markets reflects the uncertainty about how the continuing global imbalances of the world economy, with many indebted states, will affect the economic situation at both macro and micro levels.
The Core Investments subsidiaries are, like Investor, exposed to commercial risks, financial risks and market risks. In addition these companies, through their business activities within respective sector, also are exposed to legal/ regulatory risks and political risks, for example political decisions on healthcare budgets and industry regulations.
Financing of Investor's Core Investments subsidiaries and the partner-owned investments are made on a ring-fenced basis, without guarantees from Investor, the guarantee to 3 Scandinavia being the exception.
Whatever the economic situation in the world, operational risk management requires continued high level of awareness and focused work in line with stated policies and instructions. Investors risk management, risks and uncertainties are described in detail in the Annual Report 2012, (Administration report and Note 3). No significant changes have been made subsequently, aside from changes in current macroeconomic and related risks.
For the Group, this Interim report was prepared in accordance with IAS 34 Interim Financial Reporting and applicable regulations in the Swedish Annual Accounts Act, and for the Parent Company in accordance with Sweden's Annual Accounts Act, chapter 9 Interim report. Unless otherwise specified below, the accounting policies that have been applied for the Group and Parent Company are in agreement with the accounting policies used in the preparation of the company's most recent annual report.
Changes in accounting policies due to new or amended IFRS
The following accounting policies are applied by the Group as of January 1, 2013:
requirements. The new standard does not have any material monetary effect on the Group or Parent Company. Disclosures in accordance with the new requirements are presented on pages 27 – 28.
Other new or revised IFRSs and interpretations from the IFRS Interpretations Committee have had no effect on the profit/loss, financial position or disclosures for the Group or Parent Company.
No new acquisitions have been made during the quarter. Finalization has been made of Aleris acquisitions related to Stureplans Husläkarmottagning, Södermalms Hemtjänst and Xyrinx Medical AB.
| Preliminary Purchase Price |
New | Final Purchase | |
|---|---|---|---|
| SEK m. | Allocation | valuation | Price Allocation |
| Property, plant and equipment |
11 | 0 | 11 |
| Deferred tax assets | 0 | 1 | 1 |
| Accounts receivables | 6 | 0 | 6 |
| Other current assets | 29 | -3 | 26 |
| Cash and cash equivalents | 21 | 0 | 21 |
| Non-current liabilities and | |||
| provisions | -8 | -4 | -12 |
| Deferred tax liabilities | -1 | 0 | -1 |
| Current liabilities | -25 | -1 | -26 |
| Net identifiable assets and liabilities |
33 | -7 | 26 |
| Consolidated goodwill | 81 | 12 | 93 |
| Consideration | 114 | 5 | 119 |
According to the preliminary purchase price allocations goodwill amounted to SEK 81 m. The purchase price allocations have now been fixed with a goodwill amounting to SEK 93 m. The increase in goodwill, of SEK 12 m., relates to adjustments in consideration and intangible assets.
| Preliminary Purchase | ||
|---|---|---|
| SEK m. | Price Allocation | Total |
| Inventory | 2 | 2 |
| Accounts receivables | 2 | 2 |
| Current liabilities | -2 | -2 |
| Net identifiable assets and liabilities | 2 | 2 |
| Consolidated goodwill | 77 | 77 |
| Consideration | 79 | 79 |
Due to the fact that the acquisition is relatively small, no further information is presented.
No material changes in pledged assets and contingent liabilities during the period.
July 18 Interim Report January-June 2013 Oct. 17 Interim Report January-September 2013 Feb. 4, 2014 Year-End Report 2013 Apr. 23, 2014 Interim Report January-March 2014
Stockholm, April 23, 2013
Börje Ekholm President and Chief Executive Officer
Susanne Ekblom, Chief Financial Officer: +46 8 614 2000 [email protected]
Oscar Stege Unger, Head of Corporate Communications: +46 8 614 2059, +46 70 624 2059 [email protected]
Magnus Dalhammar, Investor Relations Manager: +46 8 614 2130, +46 73 524 2130 [email protected]
Investor AB (publ) (CIN 556013-8298) SE-103 32 Stockholm, Sweden Visiting address: Arsenalsgatan 8C Phone: +46 8 614 2000 Fax: + 46 8 614 2150 www.investorab.com
Ticker codes:
INVEB SS in Bloomberg INVEb.ST in Reuters W:ISBF in Datastream
The information in this interim report is such that Investor is required to disclose under Sweden's Securities Market Act.
The report was released for publication at 08:15 CET on April 23, 2013.
This Interim report and additional information is available on www.investorab.com
This Interim report is a translation of the original report in Swedish
This Interim report has not been subject to review by the company's auditors
| Dividends 2 326 2 077 Other operating income 126 124 Changes in value 14 123 9 265 Net sales 4 179 4 090 Cost of goods and services sold -2 838 -2 708 Sales and marketing cost -649 -642 Administrative, research and development and other operating cost -365 -381 Management cost -90 -113 Share of results of associates 4 -147 Profit/loss 16 816 11 565 Net financial items -629 -588 Profit/loss before tax 16 187 10 977 Income taxes 8 -64 Profit/loss for the period 16 195 10 913 Attributable to: Owners of the Parent Company 16 203 10 923 Non-controlling interest -8 -10 Profit/loss for the period 16 195 10 913 Basic earnings per share, SEK 21.29 14.36 Diluted earnings per share, SEK 21.26 14.35 Basic average number of shares, million 761.2 760.5 Diluted average number of shares, million 762.3 761.1 |
SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|---|
| SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|
| Profit for the period | 16 195 | 10 913 |
| Other comprehensive income for the period, including tax | ||
| Items that have been or may be recycled to profit/loss for the period |
||
| Cash flow hedges | 116 | 52 |
| Foreign currency translation adjustment | -40 | -115 |
| Share of other comprehensive income of associates | -21 | 88 |
| Total other comprehensive income for the period | 55 | 25 |
| Total comprehensive income for the period | 16 250 | 10 938 |
| Attributable to: | ||
| Owners of the Parent Company | 16 246 | 10 947 |
| Non-controlling interest | 4 | -9 |
| Total comprehensive income for the period | 16 250 | 10 938 |
| SEK m. | 3/31 2013 | 12/31 2012 | 3/31 2012 |
|---|---|---|---|
| ASSETS | |||
| Goodwill | 23 340 | 23 996 | 24 504 |
| Other intangible assets | 8 260 | 8 718 | 9 512 |
| Property, plant and equipment | 4 238 | 4 158 | 3 977 |
| Shares and participations | 178 500 | 164 318 | 155 419 |
| Other financial investments | 2 389 | 1 072 | 1 763 |
| Long-term receivables included in net debt | 548 | 947 | 461 |
| Other long-term receivables | 5 959 | 6 157 | 5 997 |
| Total non-current assets | 223 234 | 209 366 | 201 633 |
| Inventories | 1 256 | 1 264 | 1 164 |
| Shares and participations in trading operation | 270 | 113 | 2 325 |
| Short-term receivables included in net debt | 1 | 6 | 14 |
| Other current receivables | 5 019 | 3 073 | 5 035 |
| Cash, bank and short-term investments | 8 573 | 10 368 | 11 744 |
| Assets held for sale | 5 455 | 5 455 | - |
| Total current assets | 20 574 | 20 279 | 20 282 |
| TOTAL ASSETS | 243 808 | 229 645 | 221 915 |
| EQUITY AND LIABILITIES | |||
| Equity | 191 423 | 175 106 | 167 657 |
| Long-term interest bearing liabilities | 43 013 | 45 278 | 43 947 |
| Provisions for pensions and similar obligations | 722 | 728 | 670 |
| Other long-term provisions and liabilities | 2 777 | 2 873 | 3 798 |
| Total non-current liabilities | 46 512 | 48 879 | 48 415 |
| Current interest bearing liabilities | 1 473 | 1 210 | 1 628 |
| Other short-term provisions and liabilities | 4 400 | 4 450 | 4 215 |
| Total current liabilities | 5 873 | 5 660 | 5 843 |
| TOTAL EQUITY AND LIABILITIES | 243 808 | 229 645 | 221 915 |
| NET DEBT/NET CASH | |||
| Amounts in SEK m. | 3/31 2013 | 12/31 2012 | 3/31 2012 |
| Other financial investments | 2 389 | 1 072 | 1 763 |
| Receivables included in net debt | 549 | 953 | 475 |
| Cash, bank and short-term investments | 8 573 | 10 368 | 11 744 |
| Long-term interest bearing liabilities | -43 013 | -45 278 | -43 947 |
| Provisions for pensions and similar obligations | -722 | -728 | -670 |
| Current interest bearing liabilities | -1 473 | -1 210 | -1 628 |
| Adjustment related to subsidiaries1) | 11 531 | 12 058 | 13 260 |
| Total net debt/net cash | -22 166 | -22 765 | -19 003 |
| SEK m. | 1/1-3/31 2013 | 1/1-12/31 2012 | 1/1-3/31 2012 |
|---|---|---|---|
| Opening balance | 175 106 | 156 719 | 156 719 |
| Profit for the period | 16 195 | 24 175 | 10 913 |
| Other comprehensive income for the period | 55 | -318 | 25 |
| Total comprehensive income for the period | 16 250 | 23 857 | 10 938 |
| Dividends paid | - | -4 563 | - |
| Changes in non-controlling interest | -2 | -964 | - |
| Effect of long-term share-based remuneration | 69 | 57 | 0 |
| Closing balance | 191 423 | 175 106 | 167 657 |
| Attributable to: | |||
| Owners of the Parent Company | 191 030 | 174 698 | 167 008 |
| Non-controlling interest | 393 | 408 | 649 |
| Total equity | 191 423 | 175 106 | 167 657 |
1) Deductions relating to the ring-fenced subsidiaries within Core Investments and Investor Growth Capital.
| SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|
| Operating activities | ||
| Core Investments | ||
| Dividends received | 751 | 681 |
| Cash receipts | 4 055 | 3 938 |
| Cash payments | -3 751 | -3 473 |
| Financial Investments and management cost | ||
| Dividends received | 10 | 149 |
| Net cash flow, trading operation | 8 | -855 |
| Cash payments | -110 | -234 |
| Cash flows from operating activities before net interest and | ||
| income tax | 963 | 206 |
| Interest received/paid | -500 | -603 |
| Income tax paid | -49 | -88 |
| Cash flows from operating activities | 414 | -485 |
| Investing activities | ||
| Acquisitions | -762 | -968 |
| Divestments | 712 | 2 150 |
| Increase in long-term receivables | -9 | - |
| Decrease in long-term receivables | 32 | 39 |
| Acquisitions of subsidiaries, net effect on cash flow | -4 | -192 |
| Increase in other financial investments | -1 196 | - |
| Decrease in other financial investments | - | 210 |
| Net changes, short-term investments | 103 | 3 913 |
| Acquisitions of property, plant and equipment | -169 | -106 |
| Proceeds from sale of other investments | 0 | 1 |
| Net cash used in investing activities | -1 293 | 5 047 |
| Financing activities | ||
| Borrowings | 80 | 1 789 |
| Repayment of borrowings | -846 | -3 714 |
| Net cash used in financing activities | -766 | -1 925 |
| Cash flows for the period | -1 645 | 2 637 |
| Cash and cash equivalents at the beginning of the year | 7 696 | 4 312 |
| Exchange difference in cash | -36 | -4 |
| Cash and cash equivalents at the end of the period | 6 015 | 6 945 |
| Core | Financial | Investor | |||
|---|---|---|---|---|---|
| SEK m. | investments | investments | Groupwide | Elimination | Total |
| Dividends | 2 316 | 10 | - | - | 2 326 |
| Other operating income1) | 33 | 126 | - | -33 | 126 |
| Changes in value | 13 695 | 428 | - | - | 14 123 |
| Net sales | 4 202 | - | - | -23 | 4 179 |
| Cost of goods and services sold | -2 860 | - | - | 22 | -2 838 |
| Sales and marketing cost | -649 | - | - | - | -649 |
| Administrative, research and development and | |||||
| other operating cost | -337 | -28 | - | - | -365 |
| Management cost | -36 | -15 | -40 | 1 | -90 |
| Share of results of associates | 1 | 3 | - | - | 4 |
| Operating profit/loss | 16 365 | 524 | -40 | -33 | 16 816 |
| Net financial items | -354 | - | -308 | 33 | -629 |
| Income tax | 44 | - | -36 | - | 8 |
| Profit/loss for the period | 16 055 | 524 | -384 | - | 16 195 |
| Non-controlling interest | 8 | - | - | - | 8 |
| Net profit/loss for the period attributable to the | |||||
| Parent Company | 16 063 | 524 | -384 | - | 16 203 |
| Other effects on equity | -226 | -143 | 498 | - | 129 |
| Contribution to net asset value | 15 837 | 381 | 114 | - | 16 332 |
| Net asset value by business area 3/31 2013 | |||||
| Carrying amount | 176 295 | 35 585 | 1 316 | - | 213 196 |
| Net debt | - | - | -22 166 | - | -22 166 |
| Total net asset value | 176 295 | 35 585 | -20 850 | - | 191 030 |
| Core | Financial | Investor | |||
|---|---|---|---|---|---|
| SEK m. | investments | investments | Groupwide | Elimination | Total |
| Dividends | 1 936 | 141 | - | - | 2 077 |
| Other operating income1) | 5 | 124 | - | -5 | 124 |
| Changes in value | 7 861 | 1 395 | - | 9 | 9 265 |
| Net sales | 4 101 | - | - | -11 | 4 090 |
| Cost of goods and services sold | -2 718 | - | - | 10 | -2 708 |
| Sales and marketing cost | -642 | - | - | - | -642 |
| Administrative, research and development and other | |||||
| operating cost | -344 | -37 | - | - | -381 |
| Management cost | -32 | -18 | -63 | - | -113 |
| Share of results of associates | 1 | -148 | - | - | -147 |
| Operating profit/loss | 10 168 | 1 457 | -63 | 3 | 11 565 |
| Net financial items | -326 | - | -259 | -3 | -588 |
| Income tax | 47 | - | -111 | - | -64 |
| Profit/loss for the period | 9 889 | 1 457 | -433 | - | 10 913 |
| Non-controlling interest | 10 | - | - | - | 10 |
| Net profit/loss for the period attributable to the | |||||
| Parent Company | 9 899 | 1 457 | -433 | - | 10 923 |
| Other effects on equity | -120 | -29 | 164 | - | 15 |
| Contribution to net asset value | 9 779 | 1 428 | -269 | - | 10 938 |
| Net asset value by business area 3/31 2012 | |||||
| Carrying amount | 146 248 | 39 041 | 722 | - | 186 011 |
| Net debt | - | - | -19 003 | - | -19 003 |
| Total net asset value | 146 248 | 39 041 | -18 281 | - | 167 008 |
1) Includes interest on loans
| SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|
| Dividends | 2 188 | 1 936 |
| Changes in value | 12 646 | 7 834 |
| Net sales | 1 | 1 |
| Operating cost | -87 | -110 |
| Impairment of associates | - | -39 |
| Operating profit/loss | 14 748 | 9 622 |
| Profit/loss from financial items | ||
| Other financial items | 54 | 8 |
| Profit/loss after financial items | 14 802 | 9 630 |
| Income tax | - | - |
| Profit/loss for the period | 14 802 | 9 630 |
| SEK m. | 1/1-3/31 2013 | 1/1-3/31 2012 |
|---|---|---|
| Profit for the period | 14 802 | 9 630 |
| Other comprehensive income for the period Items that have been or may be recycled to profit/loss for the period |
||
| Cash flow hedges | - | 6 |
| Total other comprehensive income for the period | - | 6 |
| Total comprehensive income for the period | 14 802 | 9 636 |
| SEK m. | 3/31 2013 | 12/31 2012 | 3/31 2012 |
|---|---|---|---|
| ASSETS | |||
| Intangible assets and Property, plant and equipment | 32 | 30 | 35 |
| Financial assets | 224 662 | 208 376 | 191 397 |
| Total non-current assets | 224 694 | 208 406 | 191 432 |
| Current receivables | 2 449 | 1 207 | 2 044 |
| Cash and cash equivalents | 0 | 0 | 0 |
| Total current assets | 2 449 | 1 207 | 2 044 |
| TOTAL ASSETS | 227 143 | 209 613 | 193 476 |
| EQUITY AND LIABILITIES | |||
| Equity | 176 220 | 161 349 | 152 269 |
| Provisions | 290 | 291 | 297 |
| Non-current liabilities | 27 639 | 28 563 | 27 664 |
| Total non-current liabilities | 27 929 | 28 854 | 27 961 |
| Total current liabilities | 22 994 | 19 410 | 13 246 |
| TOTAL EQUITY AND LIABILITIES | 227 143 | 209 613 | 193 476 |
| ASSETS PLEDGED AND CONTINGENT LIABILITIES | 3/31 2013 | 12/31 2012 | 3/31 2012 |
| Assets pledged | 243 | 95 | 85 |
| Contingent liabilities | 10 200 | 10 200 | 10 204 |
| SEK m. | 1/1-3/31 2013 | 1/1-12/31 2012 | 1/1-3/31 2012 |
|---|---|---|---|
| Opening balance | 161 349 | 142 633 | 142 633 |
| Profit/loss for the period | 14 802 | 23 057 | 9 630 |
| Other comprehensive income for the period | 166 | 6 | |
| Total comprehensive income for the period | 14 802 | 23 223 | 9 636 |
| Dividends paid | - | -4 563 | - |
| Effect of long-term share-based remuneration | 69 | 56 | 0 |
| Closing balance | 176 220 | 161 349 | 152 269 |
As of the first quarter 2013, IFRS requires the information below to be disclosed in the interim reports. The numbers are based on the same accounting- and valuation policies as used in the preparation of the company's most recent annual report.
The table below indicates how fair value is measured for the financial instruments recognized at fair value in the Balance Sheet. The financial instruments are categorized on three levels, depending on how the fair value is measured: Level 1: According to quoted prices in active markets for identical instruments
Level 2: According to directly or indirectly observable inputs that are not included in level 1
Level 3: According to inputs that are unobservable in the market
In order to enable reconciliation with the Balance sheet, financial instruments that are not measured at fair value and other assets and liabilities included in the Balance sheet items, have been included in "other" in the table below.
| Financial instruments - fair value | |||||
|---|---|---|---|---|---|
| Total carrying | |||||
| Group 3/31 2013 | Level 1 | Level 2 | Level 3 | Other | amount |
| Financial assets | |||||
| Shares and participations | 156 511 | 1 498 | 18 401 | 2 090 | 178 500 |
| Other financial investments | 2 260 | 129 | 2 389 | ||
| Long-term receivables included in net debt | 444 | 104 | 548 | ||
| Shares and participations in trading operation | 270 | 270 | |||
| Short-term investments included in net debt | 1 | 1 | |||
| Other current receivables | 101 | 4 918 | 5 019 | ||
| Cash, bank and short-term investments | 7 724 | 849 | 8 573 | ||
| Total | 166 765 | 2 893 | 18 505 | 7 137 | 195 300 |
| Financial liabilities | |||||
| Long-term interest bearing liabilities | 1 405 | 157 | 41 4511) | 43 0132) | |
| Current interest bearing liabilities | 702 | 771 | 1 473 | ||
| Other short-term provisions and liabilities | 238 | 68 | 4 094 | 4 400 | |
| Total | 238 | 2 175 | 157 | 46 316 | 48 886 |
1) The Groups loans are valued at amortized cost.
2) Fair value on loans amounts to SEK 44,690 m.
Transfers between levels that have occurred during a reporting period are presented based on the value at the end of the reporting period. During the first quarter no transfers between levels have taken place.
Shares and participations in level 2 consist of holdings in listed shares for which the classes are not actively traded. The measurement of these shares is based on the market price for the most traded class of shares for the same holding.
Derivatives in level 2 consist mainly of currency and interest rate swaps for which the valuation is based on discounted future cashflows according to the terms and conditions in the agreement and based on the market rate of interest for similar instruments with different durations.
Unlisted holdings are measured on the basis of the "International Private Equity and Venture Capital Valuation Guidelines". For directly owned holdings (i.e. those owned directly by a company in the Investor Group), an overall evaluation is made to determine the measurement method that is appropriate for each specific holding. It is first taken into account whether a recent financing round or "arms length transaction" has been made, after which a valuation is made by applying relevant multiples to the holding's key ratios (for example, EBITDA), derived from a relevant sample of comparable companies, with deduction for individually determined adjustments as a consequence of, for example, the size difference between the company being valued and the sample of comparable companies. In those cases when other measurement methods better reflect the fair value of a holding, this value is used.
Unlisted holdings in funds are measured at Investor's share of the value that the fund manager reports for all unlisted holdings in the fund (Net Asset Value, NAV) and is normally updated when a new valuation is received. If Investor's assessment is that the fund manager's valuation does not sufficiently take into account factors that affect the value of the underlying holdings, or if the valuation is considered to deviate considerably from IFRS principles, the value is adjusted. When estimating the fair value market conditions, liquidity, financial condition, purchase multiples paid in other comparable third-party transactions, the price of securities of other companies comparable to the portfolio company, and operating results and other financial data of the portfolio company are taken in considerations as applicable.
Representatives from Investor's management participate actively in the valuation process within Investor Growth Capital (IGC) and evaluates the estimated fair values for holdings in IGC and the EQT funds in relation to their knowledge of the development of the portfolio companies and the market.
The valuation of currency interest rate swaps with long duration and limited liquidity is based on discounted cash flows according to the terms and conditions of the agreement and based on an estimated market rate for similar instruments with diverse durations.
The table below indicates which valuation techiques and which important unobservable input that have been used in order to estimate the carrying amounts of financial instruments in level 3. The inputs in the table below are not indicative of all the unobservable inputs that may have been used for an individual investment
| Fair value | Valuation technique | Input | Range |
|---|---|---|---|
| 18 401 | Last round of financing | n.a. | n.a. |
| 1.6 – 8.4 | |||
| 0.2 – 4.6 | |||
| 3.9 – 8.0 | |||
| NAV | n.a. | n.a. | |
| 104 | Present value computation | Market interest rate | n.a. |
| 157 | Present value computation | Market interest rate | n.a. |
| Comparable companies Comparable transactions |
EBITDA multiples Sales multiples Sales multiples |
All valuations in level 3 are based on assumptions and judgments that management consider to be reasonable based on the circumstances prevailing at the time. Changes in assumptions may result in adjustments to reported values and the actual outcome may differ from the estimates and judgments that were made.
IGC's portfolio includes approximately 100 non-listed holdings, where each valuation is individually adapted for the holding. The majority of IGC's portfolio companies are measured based on comparable companies, and the value is to a high degree depending on the level of the multiples.
For the derivatives, a parallell shift of the interest rate curve upwards by one percentage point would affect the value positively by SEK 882 m.
| Group 3/31 2013 | Shares and participations | Long-term receivables included in net debt |
Long-term interest bearing liabilities |
|---|---|---|---|
| Opening balance | 18 323 | 372 | 93 |
| Total gain or losses in profit or loss statement | |||
| in line Changes in value | 433 | -268 | 64 |
| Reported in other comprehensive income | |||
| in line Foreign currency translation adjustment | 1 | ||
| Acquisitions | 492 | ||
| Divestments | -848 | ||
| Carrying amount at end of period | 18 401 | 104 | 157 |
| Total gains or losses for the period included in profit/loss for instruments held at the end of the period (unrealized results) |
|||
| Changes in value | 12 | -268 | 64 |
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