Balco Group

Quarterly Report • Oct 28, 2024

JANUARY – SEPTEMBER 2024

More than doubled order intake

Third quarter: July - September

• Net sales increased by 31 percent to 331 MSEK (253)
• Order intake increased by 111 percent to 285 MSEK (135)
• Order backlog increased by 25 percent to 1,329 MSEK (1,067)
• Adjusted operating profit (EBITA) amounted to 17 MSEK (15)
• Adjusted operating margin amounted to 5.0 percent (6.0)
• Net profit after tax amounted to 1 MSEK (6)
• Earnings per share amounted to -0.03 SEK (0.24)
• Operating cash flow amounted to -1 MSEK (18)

The interim period: January– September

• Net sales increased by 11 percent to 1,031 MSEK (925)
• Order intake increased by 49 percent to 1,017 MSEK (682)
• Adjusted operating profit (EBITA) amounted to 52 MSEK (74)
• Adjusted operating margin amounted to 5.0 percent (8.0)
• Net profit after tax amounted to 7 MSEK (40)
• Earnings per share amounted to 0.12 SEK (1.81)
• Operating cash flow improved to 81 MSEK (-2)

Events during the quarter and since the end of the quarter

• Structural change of Riikku's operations and company structure.

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Net sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9
Order intake	285,5	135,1	1 017,2	681,7	1 312,5	977,0
Order backlog	1 328,8	1 066,9	1 328,8	1 066,9	1 328,8	1 073,6
Adjusted operating profif (EBITA)	16,6	15,2	51,5	74,5	66,9	89,8
Adjusted operating margin (EBITA), %	5,0	6,0	5,0	8,0	5,1	7,4
Net profit for the period	0,9	5,6	6,7	39,9	13,3	46,5
Operating cash flow	-1,4	18,4	80,8	-2,0	86,4	3,6
Earnings per share, SEK before dilution	-0,03	0,24	0,12	1,81	0,40	2,09
Earnings per share, SEK, after dilution	-0,03	0,24	0,12	1,81	0,40	2,09

- Camilla Ekdahl, President and CEO

^" During the quarter, Balco AB received a major turnkey project in Borås in Sweden of approximately 60 MSEK. "

^" Our newly acquired Finnish company Suomen ohutlevyasennus Oy has been selected as a supplier for several major projects during the quarter and so far in October in total of 8 MEUR. "

Strong increase in order intake

Both order intake and sales increased during the quarter compared to the same period last year. Order intake increased sharply by 111 percent, of which 49 percent was organic. Net sales increased by 31 percent, with the entire increase in net sales coming from acquisitions.

Profit and net sales are still affected by the weaker order intake last year, but profitability remains stable with an adjusted EBITA margin of 5 percent. This is not a level we are satisfied with in the longer term but given the slowdown the market experienced when interest rates and inflation increased, we still have stability in our profitability, albeit at a level that is too low compared to our target.

The market situation

Both the willingness and ability to start renovation projects have increased due to the continued lowering of interest rates and inflation that has decreased. Customer activity has continued to increase, but the trend of longer process times for decisions remains and some of our companies are exposed to greater price pressure. This applies above all to the facade companies in Sweden and our balcony company in Denmark.

The need for renovation is great both for balconies and facades and continues to be a fundamental driving force for all our companies. The need is reinforced with the new EU directive on energy performance for buildings. Balco Group will be able to play an important role in future renovation projects by offering balcony glazing that can provide energy savings of up to 30 percent. In addition, we offer turnkey projects with other energy-saving measures such as facade renovations, window replacements, roof insulation, installation of solar panels and air-to-air heat pumps.

More new turnkey projects

Our newly acquired Finnish company Suomen ohutlevyasennus Oy has been selected as a supplier for several major projects during the quarter and so far in October. The total order value is approximately 8 MEUR, of which 1.9 MEUR is included in the order intake for the third quarter. The contracts involve a turnkey renovation of the façade, windows, doors and balconies for three tenantowner associations with a total of nine apartment buildings. The balconies will be supplied by our other Finnish company Riikku. The projects will start up at the end of the year.

During the quarter, Balco AB received a major turnkey project in Borås of approximately 60 MSEK which, in addition to glazed balconies, includes facade work, drainage and upgrading of green areas. Here we have had a longstanding dialogue with the customer, where we have continuously supported with financial expertise in the discussions both within the housing association and with banks and consultants.

New innovative solution

Balco continues to prove to be the leading developer in the balcony area with solutions that can provide energy savings for the residents. A patent has been applied for further development of our solution with air-to-air heat pumps. Balco's offer to supply glazed balconies where the air-to-air heat pumps are part of the overall offering continues to attract great interest in the Norwegian market.

Structural changes

We are constantly working on optimizing our processes and our organization. To achieve the best development from our newly acquired Finnish group Riikku, we have therefore taken a decision to restructure their operations and company structure. This means, among other things, that Riikku will create an additional business area of its own in its Finnish operations with focus on renovation, while at the same time the Swedish operations for new build will be transferred to RK Teknik.

Prospects

We are noticing an increase in activity from a low level for our balcony companies that work with renovation. The entire Group has a strong focus on order intake, but we will be cautious about entering into price-pressured projects. Net sales and profit will continue to be affected in the coming quarters, due to a lower order intake in the past year, as well as the lead time from order intake until the projects can start up and generate turnover. All companies in the Group have a strong focus on costs, while at the same time we work to create good longterm profitability. This means that the coming quarters will also have some overcapacity for certain resources in the Group.

Camilla Ekdahl

President and CEO

Group development

Third quarter: July – September

Net sales increased by 31 percent to 331 MSEK (253). Acquired growth was 43 percent, currency effect was -4 percent, and organic growth was -8 percent. Net sales for the renovation segment amounted to 247 MSEK (225) and net sales for the new build segment amounted to 84 MSEK (28).

Order intake increased by 111 percent to 285 MSEK (135). Acquired order intake was 62 percent and organically order intake increased by 49 percent. The renovation segment accounted for 250 MSEK (82) and the new build segment accounted for 35 MSEK (53).

The order backlog increased by 25 percent to 1,329 MSEK (1,067). The order backlog for the renovation segment amounted to 1,034 MSEK (899) and the order backlog for the new build segment increased to 295 MSEK (168).

Gross profit amounted to 54 MSEK (53), corresponding to a gross margin of 16.2 percent (21.1). Gross profit includes items affecting comparability of 2 MSEK (0) related to restructuring costs. Adjusted gross profit was 56 MSEK (53) and adjusted gross margin was 17.0 percent (21.1). The gross margin has decreased due to a different cost structure in the acquired companies with a lower gross margin than the Group average. In addition, the gross margin is affected by low occupancy in the Group's production facilities and in the project organization.

Sales costs amounted to 25 MSEK (25) and administrative costs amounted to 20 MSEK (17). The increase comes from the acquired companies. Items affecting comparability of -2 MSEK (-1) were taken in the quarter related to acquisition costs and restructuring of the organization.

Adjusted operating profit (EBITA) amounted to 16 MSEK (15), corresponding to an adjusted operating margin of 5.0 percent (6,0).

Net financial items amounted to -9 MSEK (-5), of which -0.3 MSEK (-0.3) relates to interest expenses linked to rights of use (leases) and -1 MSEK (0) relates to unrealized currency losses. Interest expenses of -6 MSEK (-5) have increased due to increased borrowing in connection with completed acquisitions.

Profit after tax amounted to 1 MSEK (6). Earnings per share amounted to -0.03 SEK (0.24).

Operating cash flow amounted to -1 MSEK (18). The timing of building permits and the phases of the projects affect the cash flow between quarters.

Order intake per segment, MSEK

Order backlog, MSEK

Interim period: January – September

Net sales increased by 11 percent to 1,031 MSEK (925). Acquired growth was 34 percent, currency effect was -1 percent, and organic growth was -22 percent. Net sales for the renovation segment amounted to 719 MSEK (846) and net sales for the new build segment amounted to 312 MSEK (79).

Order intake increased by 49 percent to 1,017 MSEK (682). Acquired order intake was 45 percent and organic order intake increased by 4 percent. The renovation segment accounted for 789 MSEK (570) and the new build segment accounted for 228 MSEK (112).

Gross profit amounted to 190 MSEK (195), corresponding to a gross margin of 18.4 percent (21.1). The gross result includes items affecting comparability of- 6 MSEK (-4) related to restructuring costs. Adjusted gross profit was 196 MSEK (199) and adjusted gross margin 19.0 percent (21.5). The gross margin has decreased due to a different cost structure in the acquired companies with a lower gross margin than the Group average. In addition, the gross margin is affected by low occupancy in the Group's production facilities and in the project organization.

Sales costs amounted to 90 MSEK (82) and administrative costs amounted to 72 MSEK (54). The increase comes from the acquired companies. Items affecting the comparability of -8 MSEK (-3) have been taken so far this year linked to acquisition costs and restructuring of the organization.

Adjusted operating profit (EBITA) amounted to 52 MSEK (74), corresponding to an adjusted operating margin of 5.0 percent (8,0).

Net financial items amounted to -21 MSEK (-10), of which -1.1 MSEK (-1.2) relates to interest expenses linked to rights of use (leases) and -1 MSEK (0) relates to unrealized currency losses. Interest expenses of -17 MSEK (-10) have increased, due to increased borrowing in connection with completed acquisitions.

Profit after tax amounted to 7 MSEK (40), while comprehensive income for the period amounted to 9 MSEK (43) after positive currency translation differences. Earnings per share amounted to 0.12 SEK (1.81).

Operating cash flow improved to 81 MSEK (-2). The timing of building permits and the phases of the projects affect the cash flow between quarters.

Net sales, MSEK

Adjusted operating profit, MSEK

Net sales per customer category, MSEK

	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Tenant-owner associations	180,6	130,5	528,8	599,7	719,4	790,3
Private landlords	20,1	30,1	67,1	79,2	106,4	118,5
Publicly owned companies	14,4	9,1	38,6	40,3	48,9	50,5
Construction companies	116,0	83,6	397,0	206,2	446,3	255,6
Total net sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9

Net sales per geographic market, MSEK

	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Sweden	137,8	148,3	439,8	585,8	606,6	752,6
Other Nordics	165,2	63,7	489,9	228,1	571,7	310,0
Other Europe	28,1	41,2	101,8	111,5	142,7	152,3
Total net sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9

Development per segment

Renovation

Third quarter

Net sales increased by 10 percent to 247 MSEK (225), corresponding to 75 percent (89) of total net sales.

Order intake increased by 205 percent to 250 MSEK (82), corresponding to 88 percent (61) of total order intake.

The adjusted operating profit (EBITA) amounted to 15 MSEK (16), corresponding to an adjusted operating margin of 6.0 percent (7.1).

Interim period

Net sales amounted to 719 MSEK (846), corresponding to 70 percent (91) of total net sales.

Order intake increased by 39 percent to 789 MSEK (570), corresponding to 78 percent (84) of total order intake.

The adjusted operating profit (EBITA) amounted to 36 MSEK (72), corresponding to an adjusted operating margin of 5.0 percent (8.5).

The order backlog increased by 15 percent to 1,034 (899), corresponding to 78 percent (84) of the total order backlog.

Renovation, MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Net sales	246,6	225,0	719,5	846,3	961,2	1 088,0
Adjusted operating profit (EBITA)	14,8	15,9	36,2	71,9	48,0	83,8
Adhusted operating margin (EBITA), %	6,0	7,1	5,0	8,5	5,0	7,7
Order intake	250,0	82,0	789,1	569,6	1 058,2	838,7
Order backlog	1 034,4	898,7	1 034,4	898,7	1 034,4	925,5

New build

Third quarter

Net sales increased by 198 percent to 84 MSEK (28), corresponding to 25 percent (11) of total net sales.

Order intake amounted to 35 MSEK (53), corresponding to 12 percent (39) of total order intake.

The adjusted operating profit (EBITA) amounted to 3 MSEK (1), corresponding to an adjusted operating margin of 3.8 percent (5.1).

Interim period

Net sales increased by 295 percent to 312 MSEK (79), corresponding to 30 percent (9) of total net sales.

Order intake increased by 103 percent to 228 MSEK (112), corresponding to 22 percent (16) of total order intake.

The adjusted operating profit (EBITA) improved to 16 MSEK (3), corresponding to an adjusted operating margin of 5.0 percent (4.0).

The order backlog increased by 75 percent to 294 MSEK (168), corresponding to 22 percent (16) of the total order backlog.

	Jul-Sep	Jul-Sep	Jan-Sep	Jan-Sep	Oct-Sep	Jan-Dec
New Build, MSEK	2024	2023	2024	2023	2023/24	2023
Net sales	84,4	28,3	312,0	79,1	359,8	126,9
Adjusted operating profit (EBITA)	3,2	1,5	15,6	3,1	17,2	4,8
Adhusted operating margin (EBITA), %	3,8	5,1	5,0	4,0	4,8	3,8
Order intake	35,4	53,0	228,1	112,1	254,3	138,3
Order backlog	294,4	168,2	294,4	168,2	294,4	148,1

Financial position and cash flow

Liquidity and financial position

Interest-bearing net debt including lease liabilities at the end of interim period amounted to 359 MSEK (223). Pro forma, including 12 months of earnings from acquired companies, interest-bearing net debt including lease liabilities in relation to adjusted EBITDA was 2.9 times (1.4).

Interest-bearing net debt excluding lease liabilities amounted to 298 MSEK (153). Pro forma, including 12 months of earnings from acquired companies, interest-bearing net debt excluding lease liabilities in relation to adjusted EBITDA was 2.8 times (1.1).

At the end of the interim period, the Group's equity amounted to 797 MSEK (758).

The Group's equity/assets ratio was 49 percent (56).

MSEK	30-sep 2024	30-sep 2023	31-dec 2023
Non-current liabilities to credit institutions	337,0	174,7	174,2
Leasing liabilities non-current	48,1	54,3	51,2
Current liabilities to credit institutions	-	0,4	-
Leasing liabilities current	13,1	14,8	19,0
Cash and cash equivalents	-39,4	-21,6	-2,8
Interest-bearing net debt incl leasing debt	358,8	222,6	241,6
Interest-bearing net debt excl leasing debt	297,6	153,5	171,4
Interest-bearing net debt incl. leasing/EBITDA (12 months), times	3,3 x	1,5 x	1,9 x
Interest-bearing net debt incl. leasing/EBITDA (proforma) (12 months), times	2,9 x	1,4 x	1,9 x
Interest-bearing net debt excl. leasing/EBITDA (12 months), times	3,3 x	1,2 x	1,6 x
Interest-bearing net debt excl. leasing/EBITDA (proforma) (12 months), times	2,8 x	1,1 x	1,6 x
Equity/assets ratio, %	48,9	57,5	58,9

Cash flow, investments and amortization/depreciation

For the interim period, cash flow from operating activities amounted to 32 MSEK (-44).

Cash flow from investing activities amounted to -87 MSEK (-50), of which -1 MSEK (-2) was replacement investments and -5 MSEK (-9) expansion investments and -81 MSEK (-39) acquisition of shares in subsidiaries.

Cash flow from financing activities amounted to 93 MSEK (62) with the largest item relating to increased utilization of the revolving credit facility.

Cash flow for the interim period amounted to 38 MSEK (-31).

Depreciation for the interim period amounted to -39 MSEK (-33), of which -14 MSEK (-15) relates to depreciation related to rights of use (lease) and -7 MSEK (-5) relates to amortization of acquired intangible assets.

Parent company

The Parent Company is headquartered in Växjö and conducts business directly and through Swedish and foreign subsidiaries. The activities of the Parent Company are mainly focused on strategic development, financial management, corporate governance issues, board work and banking relations.

External interest-bearing net debt In relation to EBITDA (proforma)

Operating cash flow R12, MSEK

Operations and segment description

Balco Group is a market leader in the balcony industry and offers a range of services, from development and manufacturing to sales and installation of in-house manufactured open and glazed balcony systems. Balco has a unique method, known as the Balco method, to deliver glazed balconies and balcony solutions. The method involves removing existing balconies and replacing them with new, larger, glazed balconies with a lifespan of over 90 years, which provides the market's most economical and sustainable solution.

To offer complete and customized solutions in the balcony industry, Balco Group has several subsidiaries that work together to offer a complete solution in areas such as the manufacture and delivery of balconies, masonry and tile services, technical solutions and façade services such as renovation, window replacement and façade cleaning. Balco Group strives to meet the customer's needs and requirements by offering a combination of specialized services and expertise. Balco Group's offering contributes to increased quality of life, security and value increase for residents in apartment buildings and provides energy savings of up to 30 percent. The Group takes full responsibility for the project and guides the customer through the entire process from project planning to final inspection and service.

Sjøsiden Boligpark, Norway New Road Rainham, UK

The segment includes the replacement and expansion of existing balconies, mainly glazed balconies. The main driving force is the pent-up need for renovation and the age profile of the properties. The offer also includes façade renovation.

Sales development per quarter, MSEK Operating margin per quarter, %

Segment - Renovation Segment - New Build

The segment includes balconies in the construction of multidwelling properties. Demand is driven by the pace of new housing production. The offer also includes façade work in new construction.

Sustainability

Sustainability is a prerequisite for long-term profitability for Balco Group. By focusing on sustainability, we can create a strong brand, increase customer trust, and improve our competitiveness in the long term. We will continue to work hard to incorporate sustainability into all aspects of our business.

Sustainability is a focus area in the construction industry and affects all parts of the value chain. This is especially true of the market for balconies where Balco Group operates. Property developers and property owners are demanding economically advantageous and climate-smart solutions with a long lifespan.

As an important step in our sustainability work and goal to be a leader in the climate transition in its industry, Balco Group has committed to developing short-term and long-term emission reduction targets including net zero targets in line with the Science Based Targets initiative (SBTi).

Other information

Employees

The number of full-time employees in Balco Group amounted to 631 (501) as of the end of September 2024. The increase comes from the acquired companies Riikku Group Oy and Suomen ohutlevyasennus Oy.

Seasonality

Balco's sales and earnings are partly affected by the timing of orders, seasonal variations and the fact that the general meeting season in tenant-owner associations normally falls in the second and fourth quarters. Furthermore, the Group is positively affected by months with many working days and lack of time off, as well as negatively by weather factors where winters with significant snowfall mean increased costs.

Shares, share capital and shareholders

As of the end of September 2024, the number of shares in Balco Group AB amounted to 23,021,648 shares, corresponding to a share capital of 138,135,310 SEK. The number of shareholders was 5,025. The five largest shareholders were Familjen Hamrin, Skandrenting AB, Lannebo Kapitalförvaltning, Swedbank Robur fonder and AB Tuna Holding.

Related party transactions

The related parties consist of the Board of Directors, Group Management and the CEO, partly through ownership in Balco and partly through the role of senior executive. The related parties also include the company's largest shareholders, the Hamrin family, which is represented on the board by Carl-Mikael Lindholm, and Skandrenting, which is represented on the board by Johannes Nyberg. Transactions with related parties are carried out on a market basis. For further information, see the Annual Report 2023 on pages 79 and 99.

Incentive program

Balco Group AB has two long-term incentive programs aimed at the company's senior executives and additional key employees, a total of approximately 40 employees. The incentive programs comprise a maximum of 450,000 warrants in total, which entitle the holder to subscribe for a maximum of the corresponding number of shares. Balco's total cost for the incentive programs during the term of the programs is expected to amount to approximately 3 MSEK. The programs entail a dilution corresponding to approximately 2 percent of the company's total number of shares. The senior executives of Balco have acquired 120,000 warrants amounting to a total value of 549,800 SEK. The purpose of the incentive programs is to encourage broad shareholding among Balco's employees, facilitate recruitment, retain competent employees and increase the motivation to achieve or exceed the company's financial targets. For more information, see the Annual Report 2023 on pages 76, 78 and 113.

Risks and uncertainty factors

The Group and the Parent Company are exposed to various types of risks through their operations. The risks can be divided into industryand market-related risks, business-related risks and financial risks. Industry- and market-related risks include, among other things, changes in demand because of a weaker economy or other macroeconomic changes, a changed price picture for raw materials that are central to Balco's production, and changes in competition or price pressure. Business-related risks include Balco's ability to develop and sell new innovative products and solutions, that the Group can attract and retain qualified employees, and that Balco's profitability is dependent on the results of the individual projects, i.e. the Group's ability to predict, calculate and deliver the projects within set financial frameworks. The financial risks are summarized under financing risk, liquidity risk, credit risk and interest rate risk. Balco's risks and uncertainties are described on pages 30–35, 42, 87–88, 91 and 94 of the Annual Report for 2023.

Outlook

Balco Group is one of the few complete balcony suppliers on the market that provides customized and innovative balcony solutions on a turnkey contract. Balco Group is the market leader in the Nordic region and has a challenging position in other markets where the Group operates. The market is fragmented and growing throughout Northern Europe. The value of the balcony market in the countries where Balco Group is represented is estimated at just over 40 billion SEK.

Balco Group continuously evaluates selective acquisitions that can strengthen our market position in existing markets. The timing of building permits affects cash flow between quarters. The lower order intake over the past year will affect sales and earnings in the coming quarters. We continue to focus on costs and adjust the organization based on changes in occupancy and order intake but retain important expertise so that the company is not damaged in the long term.

Financial targets

Revenue growth

Balco shall achieve growth of 10 percent per year during a business cycle.

Profitability

Earnings per share shall grow by 20 percent per year during a business cycle.

Capital structure

Interest-bearing net debt shall not exceed 2.5 times operating profit before depreciation and amortization (EBITDA), other than temporarily.

Dividend policy

Balco shall distribute 30-50 percent of profit after tax, taking into consideration the needs for Balco's long-term growth and prevailing market conditions

The interim report has been subject to a review of ISRE 2410 by the company's auditors.

This information comprises such information as Balco Group AB is obliged to publish in accordance with the EU Market Abuse Regulation. The information was provided by the contact person below for publication on October 28, 2024, at 13:00 CET.

Camilla Fkdahl President and CEO

Web conference

A webcast conference call will be held at 14:00 CET October 28, 2024, where CEO and President Camilla Ekdahl and CFO Michael Grindborn will present the report and answer questions.

To follow the webcast presentation and send written questions, please use this link: https://www.finwire.tv/webcast/balcogroup/g3-2024/

To participate via teleconference and be able to ask questions, call in:

SE: +46 8 5052 0017 PIN: 835 5857 5016 #

For more information, please contact:

Camilla Ekdahl, President and CEO, Tel: +46 70 606 30 32, camilla.ekdahl@balco.se Michael Grindborn, CFO and Head of IR. Tel: +46 70 670 18 48, michael.grindborn@balco.se

Calendar 2024

Year-end report Jan-Dec 2024 ...... February 10, 2025 Annual Report 2024 ...... March 14, 2025 Interim report Jan-Mar 2025 ..... April 28, 2025 Annual General Meeting 2025...... May 6, 2025 Interim report Jan-Jun 2025 ......July 14, 2025 Interim report Jan-Sep 2025..... October 27, 2025

Consolidated statement of comprehensive income

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Net sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9
Production and project costs	-277,5	-199,9	-841,6	-730,5	-1 080,7	-969,5
Gross profit	53,6	53,4	189,8	194,9	240,3	245,4
Sales costs	-25,5	-25,3	-89,7	-81,5	-116,5	-108,4
Administration costs	-19,8	-17,2	-72,4	-54,3	-94,8	-76,7
Other operating income	1,2	1,4	2,2	3,5	9,0	10,3
Other operating expenses	-0,0	-0,1	-0,0	-0,2	-0,1	-0,2
Operating profit	9,5	12,3	29,9	62,3	38,0	70,4
Finance income	0,4	0,9	2,7	2,7	3,7	3,7
Finance costs	-9,2	-5,8	-23,8	-12,7	-29,2	-18,1
Profit before tax	0,8	7,3	8,8	52,4	12,5	56,0
Income tax	0,2	-1,7	-2,1	-12,4	0,8	-9,5
Net profit for the period	0,9	5,6	6,7	39,9	13,3	46,5
Net result attributable to parent company's shareholders	-0,7	5,3	2,7	39,7	8,9	45,9
Net result attributable to non-controlling interest	1,6	0,3	4,0	0,2	4,4	0,6
Net profit for the period	0,9	5,6	6,7	39,9	13,3	46,5
Other comprehensive income
Items that may later be reclassified to the income
statement
Translation difference when translating foreign operations	-1,5	-4,5	1,9	3,4	1,9	3,4
Comprehensive income for the period	-0,5	1,1	8,7	43,4	15,2	49,9
Comprehensive income attributable to parent company's shareholders	-2,2	0,8	4,7	43,2	10,8	49,2
Comprehensive income attributable to non-controlling interest	1,6	0,3	4,0	0,2	4,4	0,6
Comprehensive income for the period	-0,5	1,1	8,7	43,4	15,2	49,9
Earnings per share, SEK, before dilution	-0,03	0,24	0,12	1,81	0,40	2,09
Earnings per share, SEK, after dilution	-0,03	0,24	0,12	1,81	0,40	2,09
Average number of shares before dilution, thousands	23 022	21 909	22 936	21 909	22 680	21 909
Average number of shares after dilution, thousands	23 022	21 909	22 936	21 909	22 680	21 909

Consolidated balance sheet in summary

MSEK	30-sep 2024	30-sep 2023	31-dec 2023
ASSETS
Non-current assets
Intangible assets
Goodwill	515,0	485,4	485,2
Other intangible assets	276,6	142,2	142,2
Total intangible assets	791,6	627,6	627,3
Tangible assets
Right-to-use assets	59,0	67,8	70,5
Property, plant and equipment	224,6	162,9	161,9
Total tangible assets	283,6	230,6	232,4
Financial assets	3,6	-	-
Deferred tax assets	0,8	0,7	0,3
Total non-current assets	1 079,6	858,9	860,1
Current assets
Inventory	70,7	58,6	51,5
Accounts receivables	179,8	158,6	138,0
Contract assets	207,3	156,2	177,1
Other current receivables	51,5	62,7	37,7
Cash and cash equivalents	39,4	21,6	2,8
Total current assets	548,6	457,8	407,2
TOTAL ASSETS	1 628,2	1 316,7	1 267,2
EQUITY AND LIABILITIES
Equity
Share capital	138,1	131,5	131,5
Other capital contributions	450,8	406,3	406,3
Reserves	13,6	11,7	11,6
Retained earnings, incl. profit for year	191,5	207,0	196,7
Equity attributable to Parent Company's shareholders	794,0	756,5	746,1
Non-controlling interest	4,6	1,4	1,8
TOTAL EQUITY	798,6	757,9	748,0
LIABILITIES
Non-current liabilities
Liabilities to credit institutions	337,0	174,7	174,2
Leasing liabilities	48,1	54,3	51,2
Other non-current liabilities	36,6	13,8	1,4
Deferred tax liabilities	69,5	42,1	41,7
Total non-current liabilities Current liabilities	491,2	284,9	268,5
Liabilities to credit institutions	-	0,4	-
Leasing liabilities	13,1	14,8	19,0
Contract liabilities	61,0	70,3	50,0
Accounts payables	147,1	101,7 86,7	91,0 90,7
Other current liabilities Total current liabilities	117,1 338,3	273,9	250,7

Consolidated changes in Shareholders' Equity

				Retained
	Share	Addition al paid-in		earnings including	Non controlling	Total
MSEK	Capital		capital Reserves	comprehensive	interest	equity
Opening balance 1 Jan 2023	131,5	406,3	8,3	183,7	1,2	731,0
Comprehensive income for the period
Profit for the period	-	-	-	39,7	0,2	39,9
Other comprehensive income for the period	-	-	3,4	-	-	3,4
Total comprehensive income for the period	-	-	3,4	39,7	0,2	43,3
Transactions with shareholders:
Distributed dividend	-	-	-	-16,4	-	-16,4
Total transactions with Company owners	-	-	-	-16,4	-	-16,4
Closing balance 30 Sep 2023	131,5	406,3	11,7	207,0	1,4	757,9
Opening balance 1 Jan 2024	131,5	406,3	11,6	196,7	1,8	748,0
Comprehensive income for the period
Profit for the period	-	-	-	2,7	4,0	6,7
Other comprehensive income for the period	-	-	1,9	-	-	1,9
Total comprehensive income for the period	-	-	1,9	2,7	4,0	8,7
Transactions/ acquisitions/ disposald in holdings without
control	-	-	-	-7,9	-1,2	-9,1
Transactions with shareholders:
New shares issue	6,7	43,5	-	-	-	50,2
New warrants issue	-	0,9	-	-	-	0,9
Total transactions with Company owners	6,7	44,5	-	-	-	51,1
Closing balance 30 Sep 2024	138,1	450,8	13,6	191,5	4,6	798,6

Consolidated Cash Flow Statements in summary

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Operating activities
Operating profit (EBIT)	9,5	12,3	29,9	62,3	38,0	70,4
Adjustment for non-cash items	12,5	8,9	22,9	34,0	27,9	38,9
Interest received	0,7	0,9	2,5	2,7	3,5	3,7
Interest paid	-7,5	-5,5	-20,4	-11,5	-25,5	-16,5
Income tax paid	-5,7	-7,4	-14,3	-32,4	12,4	-5,8
Cash flow from operating activities before changes in working capital	9,5	9,2	20,6	55,1	56,2	90,7
Changes in working capital
Increase (-)/Decrease (+) in inventories	-0,0	0,8	-2,0	0,2	5,2	7,4
Increase (-)/Decrease (+) in current assets	22,2	10,0	18,5	7,5	15,3	4,3
Increase (+)/Decrease (-) in current liabilities	-51,5	-14,0	-5,2	-106,4	-27,3	-128,5
Cash flow from operating activities	-19,8	5,9	31,9	-43,6	49,3	-26,1
Cash flow from investing activities
Investments in intangible fixed assets	-1,5	-0,5	-2,5	-3,5	-4,6	-5,6
Investments in tangible fixed assets	-0,5	-1,4	-2,9	-6,8	-3,8	-7,7
Acquisitions of operations	0,3	-	-80,8	-39,5	-80,8	-39,5
Changes in other non-current assets/liabilities	-0,4	-	-0,8	-	-0,8	-
Cash flow from investing activities	-2,0	-1,9	-87,0	-49,8	-90,0	-52,9
Cash flow from financing activities
Changes in bank loans	-14,2	-5,0	108,3	94,4	99,7	85,8
Changes in leasing	-4,9	-4,0	-15,1	-15,7	-22,8	-23,4
New warrants issue	0,9	-	0,9	0,0	0,9	0,0
Distributed dividend to non-controlling interest	-1,2	-	-1,2	-	-1,2	-
Distributed dividend to parent company's shareholders	-	-	-	-16,4	-16,4	-32,9
Cash flow from financing activities	-19,3	-9,0	92,9	62,3	60,2	29,6
Cash flow for the period	-41,2	-5,0	37,8	-31,1	19,5	-49,4
Cash and cash equivalents at beginning of the period	81,2	27,5	2,8	51,9	21,6	51,9
Exchange rate differential cash and cash equivalents	-0,7	-0,9	-1,2	0,8	-1,7	0,4
Cash and cash equivalents at end of the period	39,4	21,6	39,4	21,6	39,4	2,8

Key ratios

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Net sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9
Order intake	285,5	135,1	1 017,2	681,7	1 312,5	977,0
Order backlog	1 328,8	1 066,9	1 328,8	1 066,9	1 328,8	1 073,6
Gross profit	53,6	53,4	189,8	194,9	240,3	245,4
Adjusted Gross Profit	56,2	53,4	195,8	198,7	249,9	252,9
EBITDA	22,4	22,3	69,4	95,7	88,4	114,7
Adjusted EBITDA	27,4	23,5	83,6	102,8	108,2	127,4
Operating profit (EBITA)	11,6	13,9	37,3	67,4	47,0	77,1
Adjusted operating profit (EBITA)	16,6	15,2	51,5	74,5	66,9	89,8
Operating profit (EBIT)	9,5	12,3	29,9	62,3	38,0	70,4
Adjusted operating profit (EBIT)	14,5	13,5	44,2	69,4	57,9	83,0
Gross profit margin, %	16,2	21,1	18,4	21,1	18,2	20,2
Adjusted gross margin, %	17,0	21,1	19,0	21,5	18,9	20,8
EBITDA margin, %	6,8	8,8	6,7	10,3	6,7	9,4
Adjusted EBITDA margin, %	8,3	9,3	8,1	11,1	8,2	10,5
Operating profit margin (EBITA), %	3,5	5,5	3,6	7,3	3,6	7,9
Adjusted operating profit margin (EBITA), %	5,0	6,0	5,0	8,0	5,0	8,4
Operating profit margin (EBIT), %	2,9	4,8	2,9	6,7	2,9	5,8
Adjusted operating profit margin (EBIT), %	4,4	5,3	4,3	7,5	4,4	6,8
Operating cash flow	-1,4	18,4	80,8	-2,0	86,4	3,6
Operating cash conversion, %	-5,1	78,2	96,6	-2,0	79,8	2,8
Capital employed, average	1 144,0	978,9	1 070,3	906,9	1 066,0	911,2
Capital employed, excl. goodwill, average	629,7	493,4	570,2	435,2	565,8	439,7
Equity, average	793,7	756,1	770,1	743,2	775,3	738,0
Interest-bearing net debt incl leasing debt	358,8	222,6	358,8	222,6	358,8	241,6
Interest-bearing net debt excl leasing debt	297,6	153,5	297,6	153,5	297,6	171,4
Interest-bearing net debt incl. leasing/Adjusted EBITDA 12 months, times	3,3	1,5	3,3	1,5	3,3	1,9
Interest-bearing net debt excl. leasing/EBITDA (12 months), times	3,3	1,2	3,3	1,2	3,3	1,6
Return on capital employed, %, (12 months)	5,1	10,5	5,4	11,3	5,4	9,1
Return on capital employed, excl. goodwill, %, (12 months)	9,2	20,8	10,1	23,6	10,2	18,9
Return on invested capital, %, (12 months)	1,7	8,7	1,7	8,9	1,7	6,3
Equity/assets ratio, %	48,8	57,5	53,2	56,9	52,7	57,6
Number of full-time employees on the closing date	631	501	631	501	631	490
Average number of shares before dilution, thousands	23 022	21 909	22 936	21 909	22 680	21 909
Average number of shares after dilution, thousands	23 022	21 909	22 936	21 909	22 680	21 909
Equity per share, SEK	34,49	34,53	33,57	33,92	34,18	33,68

Parent Company, income statement in summary

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Net sales	6,0	6,2	17,8	18,4	25,8	26,4
Administrative expenses	-4,5	-3,9	-15,4	-13,3	-26,8	-24,7
Operating profit	1,4	2,3	2,4	5,1	-1,0	1,7
Interest income and similar profit/loss items	3,1	0,8	7,6	4,0	10,6	6,9
Interest expenses and similar profit/loss items	-5,2	-5,0	-18,2	-14,4	-23,3	-19,4
Dividend / result from group company	4,8	-	277,5	12,7	302,7	37,9
Profit/loss after financial items	4,1	-2,0	269,3	7,3	289,1	27,0
Appropriations	-	-	-	-	47,9	47,9
Tax	0,1	0,4	1,7	1,1	-7,2	-7,7
Net profit/loss for the period	4,3	-1,6	271,0	8,4	329,8	67,1

In the Parent Company there are no items that are reported as other comprehensive income, so total comprehensive income is consistent with the profit for the period.

Parent company, balance sheet in summary

	30-sep	30-sep	31-dec
MSEK ASSETS	2024	2023	2023
Non-current assets
Financial assets
Shares in group companies	1 080,0	745,7	1 458,2
Other non-current assets	3,7	2,9	3,4
Total non-current assets	1 083,7	748,5	1 461,6
Current assets
Receivables from group companies	194,8	154,7	89,7
Other current receivables	17,0	39,1	6,2
Cash and cash equivalents	34,4	14,0	-
Total current assets	246,2	207,8	95,8
TOTAL ASSETS	1 329,9	956,4	1 557,4
EQUITY AND LIABILITIES
Equity
Restricted equity	138,1	131,5	131,5
Non-restricted equity	691,0	333,2	375,5
Total equity	829,1	464,7	507,0
LIABILITIES
Non-current liabilities
Liabilities to credit institutions	324,3	150,0	150,0
Other non-current liabilities	32,2	15,8	10,9
Total non-current liabilities	356,5	165,8	160,9
Current liabilities
Liabilities to credit institutions	-	-	3,4
Liabilities to group companies	120,7	316,1	874,7
Other current liabilities	23,7	9,8	11,4
Total current liabilities	144,3	325,9	889,6
TOTAL EQUITY AND LIABILITIES	1 329,9	956,4	1 557,4

Notes

Note 1 Accounting principles

This summary consolidated interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and relevant provisions of the Swedish Annual Accounts Act. The interim report for the Parent Company has been prepared in accordance with RFR 2 and Chapter 9, Interim Reports, of the Swedish Annual Accounts Act. For both the Parent Company and the Group, the same accounting policies and computation methods have been applied as in the 2023 Annual Report, which was prepared in accordance with International Financial Reporting Standards and Interpretations as adopted by the EU. The information on pages 1-9 relating to the part of the year covered by this interim report constitutes an integral part of this financial report.

Note 2 Financial instruments

The financial instruments measured at fair value are forward exchange contracts. Financial assets at fair value amounted to 0,0 MSEK (0.7) at the end of the period while financial liabilities at fair value amounted to 0,0 MSEK (1.0). The fair values of financial instruments are determined using valuation techniques. Market information is used as far as possible when available, while company-specific information is used as little as possible. If all key inputs required for the fair value measurement of an instrument are observable, the instrument is categorized in level 2. Reported value of trade receivables, other receivables, cash and cash equivalents, trade payables and other liabilities constitutes a reasonable approximation of fair value.

Note 3 Business segments

Balco reports the following segments:

Renovation: includes replacement and expansion of existing balconies and installation of new balconies on apartment buildings without balconies. The segment's main market driver is the age profile of the residential property portfolio. New Build: includes installation of balconies in conjunction with the construction of apartment buildings and balcony solutions in the

maritime	area.	The	segment	is	driven	mainly	by	the	rate of	new	residential		construction.
Jul-Sep				Renovation			New Build		Group-wide		Eliminations		Total
MSEK				2024	2023	2024	2023	2024	2023	2024	2023	2024	2023
Net sales – External revenue			246,6	225,0	84,4	28,3	-	-	-	-	331,0	253,3
Net sales – Internal revenue				-	-	-	-	6,0	6,2	-6,0	-6,2	-	-
Total sales				246,6	225,0	84,4	28,3	6,0	6,2	-6,0	-6,2	331,0	253,3
Operating profit (EBIT)				9,2	14,1	2,4	1,5	-2,2	-3,3	-	-	9,5	12,3
Depreciation included with				9,6	9,8	3,4	0,2	-	-	-	-	13,0	10,0
of which amortization				1,6	1,7	0,5	-	-	-	-	-	2,1	1,7
Items affecting comparison				3,9	0,2	0,3	-	0,7	1,0	-	-	5,0	1,2
Adjusted operating profit (EBITA)				14,8	15,9	3,2	1,5	-1,4	-2,2	-	-	16,6	15,2
Adjusted operating margin				6,0%	7,1%	3,8%	5,1%					5,0%	6,0%
Operating profit (EBIT)			9,2	14,1	2,4	1,5	-2,2	-3,3	-	-	9,5	12,3
Finance income				-	-	-	-	0,4	0,9	-	-	0,4	0,9
	Finance cost			-	-	-	-	-9,2	-5,8	-	-	-9,2	-5,8
Profit before tax				9,2	14,1	2,4	1,5	-10,9	-8,2	-	-	0,8	7,3

Jan-Sep	Renovation		New Build		Group-wide		Eliminations		Total
MSEK	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023
Net sales – External revenue	719,5	846,3	312,0	79,1	-	-	-	-	1 031,5	925,4
Net sales – Internal revenue	-	-	-	-	17,8	18,4	-17,8	-18,4	-	-
Total sales	719,5	846,3	312,0	79,1	17,8	18,4	-17,8	-18,4	1 031,5	925,4
Operating profit (EBIT)	24,7	61,9	11,6	3,0	-6,4	-2,5	-	-	29,9	62,3
Depreciation included with	30,0	31,2	9,5	2,2	-	-	-	-	39,5	33,4
of which amortization	4,2	4,9	3,2	0,2	-	-	-	-	7,4	5,1
Items affecting comparison	7,2	5,1	0,9	-	6,1	1,9	-	-	14,2	7,0
Adjusted operating profit (EBITA)	36,2	71,9	15,6	3,1	-0,2	-0,6	-	-	51,5	74,5
Adjusted operating margin (EBITA)	5,0%	8,5%	5,0%	4,0%					5,0%	8,0%
Operating profit (EBIT)	24,7	61,9	11,6	3,0	-6,4	-2,5	-	-	29,9	62,3
Finance income	-	-	-	-	2,7	2,7	-	-	2,7	2,7
Finance cost	-	-	-	-	-23,8	-12,7	-	-	-23,8	-12,7
Profit before tax	24,7	61,9	11,6	3,0	-27,5	-12,5	-	-	8,8	52,4

Note 4 Reconciliation with IFRS financial statements

Balco's financial statements include alternative performance measures, which complement the measures that are defined or specified in applicable rules for financial reporting. Alternative performance measures are presented since, as in their context, they provide clearer or more in-depth information than the measures defined in applicable rules for financial reporting. The alternative performance measures are derived from the Company's consolidated financial reporting and are not measured in accordance with IFRS.

MSEK	30-sep 2024	30-sep 2023	31-dec 2023
Interest-bearing net debt incl leasing debt
Non-current interest-bearing liabilities	385,1	229,0	225,4
Current interest-bearing liabilities	13,1	15,1	19,0
Cash and cash equivalents	-39,4	-21,6	-2,8
Interest-bearing net debt incl leasing debt	358,8	222,6	241,6
Adjusted EBITDA (R12)	108,2	147,7	127,4
Interest-bearing net debt/EBITDA (R12), times	3,3	1,5	1,9
Interest-bearing net debt excl leasing debt
Interest-bearing net debt incl leasing debt	358,8	222,6	241,6
Leasing liabilities non-current	-48,1	-54,3	-51,2
Leasing liabilities current	-13,1	-14,8	-19,0
Interest-bearing net debt excl leasing debt	297,6	153,5	171,4
Interest-bearing net debt/EBITDA excl leasing (R12), times Adjusted EBITDA (R12) Leasing depreciations (R12)	108,2 -18,8	147,7 -23,9	127,4 -20,2
Adjusted EBITDA (R12) excl leasing depreciations	89,5	123,9	107,1
Interest-bearing net debt/EBITDA excl leasing (R12), times	3,3	1,2	1,6
Return on capital employed
Equity	794,0	756,5	746,1
Interest-bearing net debt	358,8	222,6	241,6
Average capital employed	1 066,0	907,8	911,2
Adjusted operating profit (EBIT), (R12)	57,9	102,7	83,0
Return on capital employed, %	5,4	11,3	9,1
Equity/assets ratio
Equity attributable to owners of the parent company	794,0	756,5	746,1
Total assets	1 628,2	1 316,7	1 267,2
Equity/assets ratio, %	48,8	57,5	58,9

MSEK	Jul-Sep 2024	Jul-Sep 2023	Jan-Sep 2024	Jan-Sep 2023	Oct-Sep 2023/24	Jan-Dec 2023
Adjusted operating profit (EBIT)
Operating profit (EBIT	9,5	12,3	29,9	62,3	38,0	70,4
Items affecting comparison
Re-structuring costs	4,2	0,2	8,1	5,1	13,7	10,7
Acquisition costs	0,7	1,0	6,1	1,9	6,2	1,9
Adjusted operating profit (EBIT)	14,5	13,5	44,2	69,4	57,9	83,0
Operating profit (EBITA)	-	-	-	-	-	-
Operating profit (EBIT)	9,5	12,3	29,9	62,3	38,0	70,4
Amortization	2,1	1,7	7,4	5,1	9,0	6,8
Operating profit (EBITA)	11,6	13,9	37,3	67,4	47,0	77,1
Adjusted operating profit (EBITA)	-	-	-	-	-	-
Adjusted operating profit (EBIT)	14,5	13,5	44,2	69,4	57,9	83,0
Amortization	2,1	1,7	7,4	5,1	9,0	6,8
Adjusted operating profit (EBITA)	16,6	15,2	51,5	74,5	66,9	89,8
EBITDA
Operating profit (EBIT)	9,5	12,3	29,9	62,3	38,0	70,4
Depreciation and amortization	13,0	10,0	39,5	33,4	50,4	44,3
EBITDA	22,4	22,3	69,4	95,7	88,4	114,7
Adjusted EBITDA
Adjusted operating profit (EBIT)	14,5	13,5	44,2	69,4	57,9	83,0
Depreciation and amortization	13,0	10,0	39,5	33,4	50,4	44,3
Adjusted EBITDA	27,4	23,5	83,6	102,8	108,2	127,4
Investments, excluding expansion investments
Investments in intangible fixed assets Investments in tangible fixed assets	-1,5 -0,5	-0,5 -1,4	-2,5 -2,9	-3,5 -6,8	-4,6 -3,8	-5,6 -7,7
of which expansion investments	1,6	0,4	4,4	4,4	7,0	7,0
Investments, excluding expansion investments	-0,4	-1,5	-1,0	-5,9	-1,4	-6,4
Operating cash flow
Adjusted EBITDA	27,4	23,5	83,6	102,8	108,2	127,4
Changes in working capital	-28,5	-3,6	-1,8	-98,9	-20,4	-117,4
Investments, excluding expansion investments	-0,4	-1,5	-1,0	-5,9	-1,4	-6,4
Operating cash flow	-1,4	18,4	80,8	-2,0	86,4	3,6
Net Sales excluding acquisitions
Net Sales	331,0	253,3	1 031,5	925,4	1 321,0	1 214,9
Acquired net sales	-109,2	-18,1	-315,7	-58,2	-322,0	-64,6
Net Sales excluding acquisitions	221,8	235,1	715,8	867,2	999,0	1 150,3

Note 5 Acquisition

On January 22, Balco Group entered into an agreement on and completed the acquisition of all shares in Riikku Group Oy, one of Finland's leading companies in balcony glazing. The acquisition is consolidated from 1 January 2024 and is expected to contribute positively to earnings per share during the full year 2024.Through the acquisition, Balco Group establishes a strong position in the Finnish balcony market and strengthens the range in the new construction segment. The acquisition also strengthens Balco Group's market position in the Nordics, in line with the group's long-term strategy.

Riikku Group Oy was founded in 2005 and is one of Finland's two largest balcony glazing companies. The company mainly works with new build, but also sells in the renovation segment. Riikku's head office is in Alavus, Finland and has sales offices in several Finnish cities as well as subsidiaries in Sweden, Norway, and Finland. The Riikku Group had a turnover of approximately 40 MEUR in 2023 with an operating margin that was slightly lower than Balco Group's. Riikku has a modern and well-invested production facility of approximately 7,500 m2 in Alavus. Riikku and its subsidiaries will continue to be run by the current management with Joakim Petersen-Dyggve as Managing Director.

The agreed purchase price amounts to 15 MEUR on a cash and debt-free basis. 3 MEUR will be paid with newly issued shares to Riikku's former owners. The remaining 12 MEUR is financed with own cash and was paid half upon entry and half over the next four years with a quarter per year. The acquisition calculation is preliminary.

The purchase price comprises the following components (MSEK)

Cash payment	78,5
Present value calculated future payments	39,2
Aquired net assets	-117,7
Goodwill	-
The following assets and liabilities were included in the acquisition (M
Cash and cash equivalents	2,2
Tangible fixed assets	64,3
Intangible assets	104,6
Inventories	15,9
Receivables	84,3
Liabilities	-133,8
Deferred tax liabilities
Acquired net assets

On March 6, Balco Group entered into an agreement and completed the acquisition of sixty percent of the shares in Suomen ohutlevyasennus Oy, a Finnish general contracting and facade company. The acquisition is consolidated from 1 March 2024 and is expected to contribute positively to earnings per share during the full year 2024.

Through the acquisition, Balco Group further strengthens its position on the Finnish market and expands the offer in the renovation segment as well as in turnkey and green transformation. Balco Group's latest acquisition Riikku is a major supplier to Suomen Ohutlevyasennus and together the two acquisitions lead to the group establishing itself as a leading player in Finland.

Suomen ohutlevyasennus Oy was founded in 1984 and is a turnkey company with facade renovation as an area of expertise. The projects mainly include facade renovation with additional insulation and often installation of balcony glazing. Over 90 percent of the company's turnover comes from the renovation segment, and the customers are tenant-owned associations and construction companies. The company is located in Turku, Finland and had a turnover of just over 11 MEUR in 2023 with a higher operating margin than Balco Group's for several years. Suomen ohutlevyasennus will continue to be run by co-owners Jukka Stam and Mikko Jokinen.

The agreed purchase price amounts to 5.4 MEUR for 60 percent of the shares on a cash and debt-free basis. 1.4 MEUR is paid with newly issued shares to Suomen ohutlevyasennus' previous owners. The remaining EUR 4 million is financed with own cash and the access was paid. The acquisition calculation is preliminary.

The purchase price comprises the following components (MSEK)

Cash payment Aquired net assets Goodwill The following assets and liabilities were included in the acquisition (M Cash and cash equivalents Tangible fixed assets	60,9 -34,8 26,1
	4,3
	9,8
Intangible assets	44,3
Receivables	11,1
Liabilities	-25,4
Deferred tax liabilities	-9,3
Acquired net assets	34,8

Alternative performance measures

This interim report contains references to several performance measures. Some of these measures are defined in IFRS, while others are alternative measures and are not reported in accordance with applicable financial reporting frameworks or other legislation. The measures are used by Balco to help both investors and management to analyze its operations. The measures used in this interim report are described below, together with definitions and the reason for their use.

Alternative performance measures	Definition	Reason for use
Return on equity	Income for the period divided by the average shareholder equity for the period. The average calculated as the average of the opening balance and the closing balance for the period.	Return on equity shows the return that is generated on the shareholders' capital that is invested in the company.
Return on capital employed	Adjusted EBITA as a percentage of average capi tal employed for the period. The average calcu lated as the average of the opening balance and the closing balance for the period.	Return on capital employed shows the return that is generated on capital employed by the company and is used by Balco to monitor profitability as it relates to the capital efficiency of the company.
Return on capital employed ex cluding goodwill	Adjusted EBITA as a percentage of average capi tal employed for the period excluding goodwill. Average calculated as the average of the opening balance and the closing balance for the period.	Balco believes that return on capital employed ex cluding goodwill together with return on capital em ployed shows a complete picture of Balco's capital ef ficiency.
Gross income	Revenue less production and project costs.	Shows the effectiveness of Balco's operations and to gether with EBIT provides a complete picture of the operating profit generation and expenses.
Gross margin	Gross income as a percentage of net sales.	Ratio is used for analysis of the company's effective ness and profitability.
EBITDA	Earnings before interest, tax, depreciation, and amortization.	Balco believes that EBITDA shows the profit generated by the operating activities and is a good measure of cash flow from operations.
Interest-bearing net debt relative to adjusted EBITDA	Interest-bearing external net debt divided by ad justed EBITDA.	Balco believes this ratio helps to show financial risk and is a useful measure for Balco to monitor the level of the company's indebtedness.
Adjusted EBITDA	EBITDA as adjusted for items affecting compara bility. For a reconciliation of adjusted EBITDA to income for the period.	Balco believes that adjusted EBITDA is a useful meas ure for showing the company's profit generated by the operating activities after adjusting for items af fecting comparability, and primarily uses adjusted EBITDA for purposes of calculating the company's op erating cash flow and cash conversion.
Adjusted EBITDA margin	Adjusted EBITDA as a percentage of net sales.	Balco believes that adjusted EBITDA margin is a useful measure for showing the company's profit generated by the operating activities after non-recurring items.
Adjusted EBIT margin	Adjusted EBIT as a percentage of net sales.	Balco believes that adjusted EBIT margin is a useful measure for showing the company's profit generated by the operating activities.
Adjusted EBIT	EBIT adjusted for items affecting comparability. For a reconciliation of adjusted EBIT to income for the period.	Balco believes that adjusted EBITA is a useful measure for showing the company's profit generated by the operating activities, and primarily uses adjusted EBIT for calculating the company's return on capital em ployed.
Adjusted EBITA margin	Adjusted EBITA as a percentage of net sales.	Balco believes that adjusted EBITA margin is a useful measure for showing the company's profit generated by the operating activities.
Adjusted EBITA	EBITA adjusted for items affecting comparability. For a reconciliation of adjusted EBIT to income for the period.	Balco believes that adjusted EBIT is a useful measure for showing the company's profit generated by the operating activities, and primarily uses adjusted EBIT for calculating the company's return on capital em ployed.
Items affecting comparability	Items affecting comparability are significant items reported separately due to their size or fre quency, e.g., restructuring costs, write-downs, di vestments, and acquisition costs.	Balco believes that adjustment for items affecting comparability improves the possibility of comparison

Alternative performance measures	Definition	Reason for use
		over time by excluding items with irregularity in fre quency or size. This is to give a more accurate picture of the underlying operating profit.
Operating cash conversion	Operating cash flow divided by adjusted EBITDA.	Balco believes this is a good measure for comparing cash flow with operating profit.
Operating cash flow	Adjusted EBITDA increased/decreased with changes in net working capital less investments, excluding expansion investments.	Operating cash flow is used by Balco to monitor busi ness performance.
Organic growth	Net sales excluding acquired growth current pe riod divided by net sales during the correspond ing period last year.	Organic growth excludes the effects of changes in the Group's structure, which enables a comparison of net sales over time.
Interest-bearing net deb	The sum of non-current interest-bearing liabili ties and current interest-bearing liabilities.	Balco believes interest-bearing net debt is a useful measure to show the company's total debt financing.
Net working capital	Current assets excluding cash and cash equiva lents and current tax assets less non-interest bearing liabilities excluding current tax liabilities.	This measure shows how much net working capital that is tied up in the operations and can be put in re lation to sales to understand how effectively net working capital tied up in the operations is used.
EBIT margin	EBIT as a percentage of net sales.	Balco believes EBIT margin is a useful measure to gether with net sales growth and net working capital to monitor value creation.
EBIT	Earnings before interest and tax.	Balco believes that EBIT shows the profit generated by the operating activities.
EBITA margin	EBITA as a percentage of net sales.	Balco believes EBITA margin is a useful measure to gether with net sales growth and net working capital to monitor value creation.
EBITA	EBIT excluding amortization on acquired intangi ble assets.	Balco's growth strategy includes acquiring compa nies. In order to better illustrate the development of the underlying business, the management has chosen to follow EBITA, which is an expression of the operat ing profit before depreciation and write-downs of ac quired intangible assets.
Equity/asset ratio	Equity divided on total assets.	Balco believes that equity to asset ratio is a useful measure for the company's survival.
Capital employed	Equity plus interest-bearing net debt.	Capital employed is used by Balco to indicate the general capital efficiency of the company.
Capital employed excluding good will	Capital employed minus goodwill.	Capital employed excluding goodwill is used together with capital employed by Balco as a measure of the company's capital efficiency.

Balco Group in brief

Balco Group is a market leader in the balcony industry, where we develop, manufacture, sell, and take responsibility for the installation of our own bespoke open and glazed balcony systems. The Group's customized products contribute to enhanced quality of life, security, and increased value for residents in multi-occupancy buildings. Furthermore, Balco Group's standardized glazing systems result in reduced energy consumption.

7 markets

1,321 MSEK net sales R12

35,000sqm total production area

631 employees Balco Group was established in 1987 and is a group consisting of producing and selling companies. The group is the market leader in the Nordics and operates in several markets in northern Europe. The head office is in Växjö, and the group has approximately 650 employees. A general and distinctive feature of the companies in the Group is that they control the entire value chain - from sales work to installed balcony through a decentralised and efficient sales process.