AddLife — Interim / Quarterly Report 2017

Jul 17, 2017

INTERIM REPORT 1 JANUARY – 30 JUNE 2017

"Acquisitions strengthen growth"

1 APRIL – 30 JUNE 2017 (3 MONTHS)

• Net sales rose by 23 percent to SEK 572 million (465), of which organic growth totalled 3 percent and acquired growth totalled 17 percent.
• EBITA rose by 25 percent to SEK 57 million (47), corresponding to an EBITA-margin of 10.1 percent (10.0).
• Profit after tax rose by 12 percent and amounted to SEK 29 million (26).
• Cash flow from operating activities amounted to SEK 37 million (-6).

1 JANUARY – 30 JUNE 2017 (6 MONTHS)

• Net sales rose by 25 percent to SEK 1,148 million (918), of which organic growth totalled 7 percent and acquired growth totalled 15 percent.
• EBITA rose by 37 percent to SEK 111 million (82), corresponding to an EBITA-margin of 9.7 percent (8.9).
• Profit after tax rose by 30 percent and amounted to SEK 58 million (45).
• Earnings per share amounted to SEK 2.39 (2.11). For the 12-month period, earnings per share amounted to SEK 5.12 (3.99).
• Cash flow from operating activities amounted to SEK 84 million (9).
• The equity ratio amounted to 40 percent (50).
• Return on working capital (P/WC) amounted to 64 percent (57).
• Two acquisitions have been carried out during the interim period, TM Techno Medica AB and Hepro AS, with a combined annual sale of about SEK 195 million.
• After the reporting period Krabat AS has been acquired, with an annual sales of about SEK 30 million.

	3 months ending			6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	change	30 Jun 17	30 Jun 16	change	30 Jun 17	31 Dec 16
Net sales	572	465	23 %	1,148	918	25 %	2,168	1,938
EBITA	57	47	25 %	111	82	37 %	218	189
EBITA-margin, %	10.1	10.0		9.7	8.9		10.1	9.7
Profit before tax	38	35	11 %	76	59	30 %	159	142
Profit for the period	29	26	12 %	58	45	30 %	125	112
Earnings per share SEK	1.21	1.14	6 %	2.39	2.11	13 %	5.12	4.87

AddLife in brief

AddLife is an independent provider in Life Science that offers high-quality products, services and advice to both the private and public sector, mainly in the Nordic region. The Group is divided into two business areas: Labtech and Medtech. The Group comprises 33 operating subsidiaries that provide equipment, instruments, medical devices and reagents, as well as advice and technical support to customers primarily in healthcare, research and academia, along with the food and pharmaceutical industries. The Company is mainly active in the Nordic countries and is also represented by smaller businesses in Germany, the Benelux countries, Estonia, Italy, UK, China and USA. AddLife is the market leader in the Nordic region in several well-defined niches in the market areas of diagnostics, medical devices, biomedical research and laboratory analysis.

Comments by the CEO

Acquisitions strengthen growth

The acquisitions we completed over the past year have driven growth in the quarter and AddLife increased sales by 23 percent to SEK 573 million. The acquisitions accounted for 17 percent of the growth. Organic growth was 3 percent, largely as a result of a weaker performance in April due to the decline during the Easter period. Accumulated growth for the entire period was 7 percent, which is in line with the long-term organic growth the group have traditionally demonstrated. EBITA increased 25 percent in the quarter, and the EBITA margin of 10.1 percent remains at the same level as last year. Cash flow for both the quarter and the first half were strong, providing us with continued opportunities for investments in our operations.

Market trend

The trend in the market in which we operate continues to be favourable. Health care and social services in the Nordic countries are facing increased challenges with a growing and ageing with chronic diseases requiring longterm treatments. Changed working methods, digital opportunities and technological developments make it possible to maintain a good social safety net and continue to help people in the best way either in the hospital, through primary care, or at home. The healthcare system needs to be streamlined to meet future challenges and our companies have strong offerings for healthcare and diagnostic laboratories. The home care segment is growing in the Nordic region, as the number of hospital beds are not sufficient to meet future needs. AddLife sees the potential of medical devices at home, related to advanced technology as well as useful aids. We also provide high-tech

instruments, reagents and advanced advice to researchers to help them in their efforts to develop tomorrow's treatment methods for both acute and chronic diseases. There is a clear need for even more active cooperation between society, research and business.

The business climate in Sweden developed favourably and our companies have many interesting opportunities. Demand from the healthcare system regarding diagnostics, medical devices and home care products is continuously good, and last year's additions, such as Leica Biosystems and Medline, have been positively received by customers. Grants remain high for various research projects within Life Science in Sweden, amongst other, Vinnova's effort in making Sweden market leaders in the biological medicine area.

Demand in Denmark has been somewhat weaker in the second quarter. The academic sector has recovered after last year's cutbacks, though the pharmaceutical industry remains somewhat cautious. Several structural projects are ongoing simultaneously in the Danish healthcare sector, including investments in the construction of new super hospitals, major procurements from 2020 and the start-up of a national programme for gene sequencing of the Danish population.

In Norway, the positive trend in the quarter continues for our companies. Demand is high in the healthcare system, especially in primary care and home care. The initiatives in Life Science research in recent years continue and demand is growing for advanced products aimed at different research groups.

The Finnish market is showing an increasing number of positive signs, despite the reduction in research grants from the Finnish government to universities and colleges. Private research projects and innovative companies are active in the market and the healthcare system continues to invest. The government has postponed its comprehensive healthcare and social services reform until 2020.

Demand for our own products outside the Nordic region has developed well, especially in the European and Chinese markets.

Acquisitions

We completed two acquisitions during the first half of the year: Techno Medica on 12 January and the Hepro Group on 1 March. Techno Medica is primarily active in enteral nutrition and the company has been integrated into Mediplast during the quarter. The Hepro group is one of the leading companies in home care and well-fare technology in Norway. Together these two businesses are expected to contribute about SEK 195 million in annual sales. After the end of the second quarter, on 13 July, Krabat was acquired, which develops, manufactures and markets high quality aids for children and youths with special needs. Krabat has sales of approximately NOK 30 million and is primarily active in Norway. All acquisitions are part of the Medtech business area.

Kristina Willgard President and CEO

Group development in the quarter

Net sales in the second quarter increased by 23 percent to SEK 572 million (465). Organic growth totalled 3 percent and acquired growth totalled 17 percent. Exchange rate changes had a positive effect on net sales of 3 percent, corresponding to SEK 17 million, and a positive effect on EBITA of 4 percent corresponding to SEK 2 million.

EBITA increased by 25 percent to SEK 57 million (47) and EBITA-margin amounted to 10.1 percent (10.0). The increase in profit is mainly related to the acquisitions.

Net financial items amounted to SEK -2 million (-2) and profit after financial items reached SEK 38 million (35). Profit after tax for the quarter increased by 12 percent to SEK 29 million (26).

Group development during the interim period

During the interim period net sales increased by 25 percent to SEK 1,148 million (918). Organic growth totalled 7 percent and acquired growth totalled 15 percent. Exchange rate changes had a positive effect on net sales of 3 percent, corresponding to SEK 24 million, and a positive effect on EBITA of 3 percent corresponding to SEK 3 million.

EBITA increased by 37 percent to SEK 111 million (82) and EBITA-margin amounted to 9.7 percent (8.9).

Net financial items amounted to SEK -4 million (-4) and profit after financial items reached SEK 76 million (59). Profit after tax for the interim period increased by 30 percent to SEK 58 million (45) and the effective tax rate was 23 percent (24).

Development in the business areas

Labtech

The Labtech business area consists of 18 companies active in the market areas diagnostics, biomedical research and laboratory equipment.

	3 months ending			6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	change	30 Jun 17	30 Jun 16	change	30 Jun 17	31 Dec 16
Net sales	336	282	19 %	679	570	19 %	1,327	1 218
EBITA	39	35	10 %	74	67	11 %	157	150
EBITA-margin, %	11.4	12.4		10.9	11.7		11.9	12.3

Labtechs net sales increased in the second quarter by 19 percent to SEK 336 million (282), of which organic growth totalled 6 percent and acquired growth totalled 9 percent. EBITA increased to by 10 percent to SEK 39 million (35), corresponding to an EBITA-margin of 11.4 percent (12.4). Net sales increased during the interim period by 19 percent to SEK 679 million (570), of which organic growth totalled 8 percent and acquired growth totalled 8 percent. EBITA increased by 11 percent to SEK 74 million (67), corresponding to an EBITA-margin of 10.9 percent (11.7).

Business conditions for our companies in Labtech were positive both in second quarter and the entire period. Demand is high in all of the Nordic countries, especially in our diagnostics companies with respect to various tests in molecular and microbiology. Our traditional areas, such as blood gas, are also performing very well since consumption of our previously installed instruments is high. The trend in Norway is favourable, especially in primary care with point-of-care tests. We are also pleased to see a continued strong performance from our Finnish companies in terms of both sales and earnings.

Grants remain high for various research projects, especially in Sweden and Norway, and growth has been strong for advanced research reagents, but weaker for laboratory instruments in the quarter. Demand is somewhat weaker in Denmark because of lower activity in the pharmaceutical industry.

Demand for our own advanced instruments has been robust, especially in Europe and China. Sales activities increased during the quarter in the US, resulting in increased orders.

Medtech

The Medtech business area consists of about 15 companies that provide medical device products within the medtech market, with a focus on surgery, thoracic medicine, neurology, wound care, anaesthesia, intensive care, ear, nose and throat, ostomies, and home healthcare.

	3 months ending			6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	change	30 Jun 17	30 Jun 16	change	30 Jun 17	31 Dec 16
Net sales	236	183	29 %	469	348	35 %	841	720
EBITA	21	14	59 %	42	26	64 %	73	57
EBITA-margin, %	9.2	7.5		9.0	7.4		8.7	7.9

In the second quarter Medtech´s net sales increased by 29 percent to SEK 236 million (183), of which comparable units decreased by 2 percent and acquired growth totalled 28 percent. EBITA increased by 59 percent and reached SEK 21 million (14), corresponding to an EBITA-margin of 9.2 percent (7.5). The increased result and EBITA-margin in the quarter is related to the acquisitions made within the business area. Net sales increased during the interim period by 35 percent to SEK 469 million (348) of which organic growth totalled 5 percent and acquired growth totalled 27 percent. EBITA increased by 64 percent to SEK 42 million (26), corresponding to an EBITA-margin of 9.0 percent (7.4).

The market for our MedTech businesses performed well and we are participating in and winning more and more contracts in the Nordic region. The expanded product portfolio we gained through the take-over of Medline has been positively received by the market. The negative organic growth in the quarter is a direct consequence of a weaker performance in the healthcare sector, due to the Easter period in April. Sales growth in the quarter therefore comes from the acquisitions, which contributed to our product portfolio with new product segments in enteral nutrition and home care. The proportion of own products is steadily increasing in medical devices, including ear, nose and throat products and surgical kits, though more importantly through our newly acquired companies in the home care segment. Own products account for about 30 percent of our sales in the business area, and consequently margins have improved. Growth in the quarter has been strongest in Sweden and Norway.

After the end of the quarter, Norwegian company Krabat was added to the business area, thereby further strengthening the product range in home care.

Financial position and cash flow

At the end of the interim period the equity ratio stood at 40 percent (50) and equity per share totalled SEK 29.72 (27.57). The return on equity at the end of the interim period was 18 percent (21). Return on working capital, P/WC (EBITA in relation to working capital) amounted to 64 percent (57). The change in return on working capital is primarily related to the improved result on EBITA.

The Group's interest-bearing net debt at the end of the period stood at SEK 605 million (296), including pension liabilities of SEK 60 million (62). The net debt/equity ratio, calculated on the basis of net debt including provisions for pensions, totalled 0.8, compared to 0.5 at the beginning of the financial year. The increase in interest bearing net debt and net debt/equity ratio, is due to financing of acquisitions.

Cash and cash equivalents, consisting of cash and bank balances, together with approved but non-utilised credit facilities, totalled SEK 231 million on 30 June 2017.

Cash flow from operating activities reached SEK 84 million (9) during the interim period. The improved cash flow is related to improved profit after financial items as well as a more efficient working capital management. Acquisitions of companies amounted to SEK 249 million (36). Investments in non-current assets during the interim period amounted to SEK 18 million (34). Disposals of non-current assets totalled SEK 0 million (0). Dividends paid to the shareholders of the Parent Company totalled SEK 37 million (277).

Employees

At the end of the period, the number of employees was 584, compared to 545 at the beginning of the interim period. During the period, implemented acquisitions led to an increase of 45 in the number of employees. The average number of employees during the latest 12-month period was 518 (418).

Acquisitions

Acquisitions completed from the 2016 financial year are distributed among the Group's business areas as follows:

Acquisitions	Time	Net sales, SEKm*	Number of employees*	Business area
V-Tech AB och Esthe-Tech AB, Sweden	April, 2016	50	11	Medtech
Svan Care AB, Sweden	October, 2016	35	13	Medtech
Biolin Scientific AB, Sweden	December, 2016	100	68	Labtech
TM Techno Medica AB, Sweden	January, 2017	30	5	Medtech
Hepro AS, Norway	March, 2017	165	40	Medtech
Krabat AS, Norway	July, 2017	30	13	Medtech

* Refers to conditions at the time of acquisition on a full-year basis.

During the interim period two company acquisitions have been completed;

On 12 January 2017, all shares in TM Techno Medica AB was acquired to the business area Medtech. The company has 5 employees and net sales of approximately SEK 30 million. The acquisitions represent an expansion in the areas of enteral nutrition, patient hygiene and incontinence

On 1 March 2017, all shares in Hepro AS, Mektron AS and Hepro Sverige AB were acquired to the business area Medtech. The companies have 40 employees and combined sales of approximately SEK 165 million. The acquisition represents an expansion into the field of home care and welfare technology.

The combined effect of the acquisitions on the AddLife Group's net sales was SEK 58 million, on EBITA SEK 11 million, on operating profit SEK 7 million and on profit after tax for the period SEK 5 million. Had the acquisitions been completed on 1 January 2017, their impact would have been approximately SEK 81 million on consolidated net sales, on EBITA about SEK 13 million and on operating profit about SEK 8 million and SEK 5 million on profit after-tax for the period.

The fair value of not yet paid contingent consideration for acquisitions made during the interim period is calculated to SEK 13 million. which is approximately 45 percent of the maximum outcome. The outcome depends on the results achieved in the companies and has a set maximum level.

According to the preliminary acquisition analyses, the assets and liabilities included in the acquisitions carried out during the first six months of 2017 were as follows:

	Fair value
Intangible non-current assets	176
Other non-current assets	1
Inventories	28
Other current assets	43
Deferred tax liability/tax asset	-40
Other liabilities	-44
Acquired net assets	164
Goodwill	97
Consideration 1)	261
Less: cash and cash equivalents in acquired businesses	-5
Less: acquired debt to acquired companies	-5
Contingent consideration not yet paid	-13
Effect on the Group's cash and cash equivalents	238

1) The consideration is stated excluding acquisition expenses.

The goodwill resulting from the acquisitions is attributable to expectations that the Group's position in the market in question for each acquisition will grow stronger and to the knowledge accumulated in the companies acquired. Transaction costs for the acquisitions totalled SEK 2 million and are recognized as selling expenses.

Shares structure

The share capital at the end of the interim period stood at SEK 50.1 million.

Share class	Number of shares
Class A shares	1,011,766
Class B shares	23,605,327
Total number of shares before repurchases	24,617,093
Of which repurchased class B shares	-230,000
Total number of shares after repurchases	24,387,093

The own holding of 230,000 Class B shares corresponds to 0.9 percent of the total number of shares and 0.7 percent of the votes. The treasury shares cover the company's undertaking in outstanding call options program from 2016. The average purchase price for shares held in treasury amounts to SEK 143.93 per share. The average number of treasury shares held during the year was 230,000 (-). The share price at 30 June 2017 was SEK 171.50 and the most recent price paid for the AddLife share on 14 July 2017 was SEK 182.00.

In accordance with a resolution of the May 2017 AGM, 27 members of management were offered the opportunity to acquire 215,000 call options on repurchased shares. The programme was fully subscribed. If fully exercised, the number of B shares outstanding will increase by 215,000, equivalent to about 0.9 percent of the total number of shares and about 0.6 percent of the votes in the Company. The call options were transferred at a price of SEK 13.70 per option, equivalent to the market value of the options based on an independent valuation conducted in accordance with the Black-Scholes model. The redemption price of the call options is SEK 222,50, corresponding to 120 percent of the average share price during the measurement period 30 May – 12 June 2017. Expiration period is from 16 June 2020 through 28 February 2021.

Issued call options for treasury shares have resulted in a dilution effect of 0.1 percent (-) during the interim period.

Parent company

The Parent Company's net sales for the interim period amounted to SEK 14 million (11) and profit after financial items for the interim period amounted to SEK -6 million (28). At the end of the interim period the Parent Company's net financial debt stood at SEK 835 million (454). The share capital at the end of the interim period was SEK 50.1 million (50.1)

Accounting policies

This interim report was prepared as per IFRSs and IAS 34 Interim Financial Reporting. Information in accordance with IAS 34. 16A exist, except in the financial statements and the related notes also in other parts of the interim report. The interim report for the parent company was prepared in accordance with the Swedish Annual Accounts Act (1995:1554) and the Securities Market Act (2007:528) in compliance with recommendation RFR 2 Accounting for Legal Entites, of the Swedish Financial Reporting Board. The accounting policies and basis for calculations applied in the 2016 annual report for AddLife AB were also used here. The new and revised IFRS standards and IFRIC interpretations effective from financial year 2017 have not had any material effect on the consolidated financial statements.

Alternative performance measures

AddLife presents certain financial measures in the interim report that are not defined according to IFRS. The Company believes that these measures provide valuable supplemental information to investors and the Company's management as they allow for evaluation of trends and the Company's performance. Since all companies do not calculate financial measures in the same way these are not always comparable to measures used by other companies. These financial measures should therefore not be considered to be a replacement for measurements as defined under IFRS. This report provides information in greater detail regarding definitions of financial performance measures.

Transactions with related parties

No transactions with related parties that materially affected the Group's position and earnings took place during the interim period.

Events after the reporting period

On July 13, 2017, Krabat AS was acquired. The company will be part of the business area Medtech. The company has 13 employees and annual net sales totals about SEK 30 million. Krabat develops, manufactures and markets high quality aids for forchildren and youths with special needs. The acquisition is expected to have a marginal positive effect on AddLife's earnings per share. The work to establish the acquisition balance is not completed and will be reported in the next interim report.

No other events of significance to the Group occurred after the end of the reporting period.

Risks and uncertainties

AddLife's earnings and financial position, as well as its strategic position, are affected by various internal factors within AddLife's control and various external factors over which AddLife has limited influence. AddLife's most significant external risks are the state of the economy and market trends combined with public sector contracts and policy decisions, as well as competition. The risks and uncertainties are the same as in previous periods. For more information, see the section "Risks and uncertainties" in the administration report (37-40), in AddLife's annual report 2016. The Parent Company is indirectly affected by the above risks and uncertainties through its function in the Group.

Stockholm, 17 July 2017

Kristina Willgård President and CEO

This report has not been subject to review by the company's auditor.

Financial calendar

The interim report for the period 1 January - 30 September 2017 will be published on 26 October 2017, at 08.00 am. The year-end report for 1 January – 31 December 2017 will be published on 13 February 2018, at 08.00 am.

Teleconference

Investors, analysts and the media are invited to a teleconference at which CEO Kristina Willgård and CFO Martin Almgren will present the year-end report. The presentation will be given in Swedish and takes about 20 minutes, after which there will be an opportunity to ask questions.

The teleconference will be at 10:00 a.m. on 17 July 2017. The presentation will be available via the following link: https://5569958126.globalmeet.com/MartinAlmgren Please call on: +46 8 22 90 90 code: 113242

Affirmation

The Board of Directors and the President deem that the interim report gives a true and fair picture of the Company's and the Group's operations, position and earnings, and describes the significant risks and uncertainty factors to which the Company and the Group are exposed.

Stockholm 17 July 2017

Johan Sjö Birgit Stattin Norinder Håkan Roos Chairman of the Board Director Director

Eva Nilsagård Fredrik Börjesson Stefan Hedelius Director Director Director

Kristina Willgård President and CEO

For further information, please contact: Kristina Willgård, President and CEO, +46 70 510 12 23 Martin Almgren, CFO, +46 70 228 15 45

Business areas

Net sales by business area		2017				2016
Quarterly data, SEKm	Q2	Q 1	Q 4	Q 3	Q 2	Q 1
Labtech	336	343	402	246	282	288
Medtech	236	233	209	163	183	165
Parent Company and Group items	-	-	-	-	-	-
AddLife Group	572	576	611	409	465	453

EBITA by business area	2017			2016
Quarterly data, SEKm	Q2	Q 1	Q 4	Q 3	Q 2	Q 1
Labtech	39	35	62	21	35	32
Medtech	21	21	19	12	14	12
Parent Company and Group items	-3	-2	-5	-2	-2	-9
EBITA	57	54	76	31	47	35
Depreciation intangible assets	-17	-14	-12	-10	-10	-9
Operating profit	40	40	64	21	37	26
Finance income and expenses	-2	-2	-3	1	-2	-2
Profit after financial items	38	38	61	22	35	24

Net sales by business area

	3 months ending			6 months ending		12 months ending
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16		30 Jun 17	31 Dec 16
Labtech	336	282	679	570		1,327	1,218
Medtech	236	183	469	348		841	720
Parent Company and Group items	-	-	-	-		-	-
AddLife Group	572	465	1,148	918		2,168	1,938

EBITA and EBITA-margin by business area and operating profit for the Group

			3 months ending			6 months ending			12 months ending
MSEK	30 Jun 17	%	30 Jun 16	%	30 Jun 17	%	30 Jun 16	%	30 Jun 17	%	31 Dec 16	%
Labtech	39	11.4	35	12.4	74	10.9	67	11.7	157	11.9	150	12.3
Medtech	21	9.2	14	7.5	42	9.0	26	7.4	73	8.7	57	7.9
Parent Company	-3		-2		-5		-11		-12		-18
and Group items
EBITA	57	10.1	47	10.0	111	9.7	82	8.9	218	10.1	189	9.7
Depreciations of	-17		-10		-31		-19		-53		-41
intangible non
current assets
Operating profit	40	7.1	37	7.8	80	7.0	63	6.8	165	7.6	148	7.6
Financial income	-2		-2		-4		-4		-6		-6
and expenses
Profit after financial	38		35		76		59		159		142
items

Group summary

Income statement	3 months ending		6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16	30 Jun 17	31 Dec 16
Net sales	572	465	1,148	918	2,168	1,938
Cost of sales	-362	-301	-733	-594	-1,407	-1,268
Gross profit	210	164	415	324	761	670
Selling expenses	-131	-101	-257	-200	-472	-415
Administrative expenses	-32	-27	-69	-61	-121	-113
Research and Development	-4	-	-8	-	-10	-2
Other operating income and expenses	-3	1	-1	0	7	8
Operating profit	40	37	80	63	165	148
Financial income and expenses	-2	-2	-4	-4	-6	-6
Profit after financial items	38	35	76	59	159	142
Tax	-9	-9	-18	-14	-34	-30
Profit for the period	29	26	58	45	125	112
Attributable to:
Equity holders of the Parent Company	29	26	58	45	125	112
Non-controlling interest	-	-	-	-	-	-
Earnings per share (EPS), SEK*	1.21	1.14	2.39	2.11	5.12	4.87
Average number of shares '000s	24,387	23,098	24,387	21,396	24,438	22,950
Number of shares at end of the period, '000	24,387	24,617	24,387	24,617	24,387	24,387
* Calculated based on equity holders' portion of profit for the period.
EBITA	57	47	111	82	218	189
Depreciations included in operating expenses
– Property, plant and equipment	-4	-4	-9	-8	-19	-18
– intangible non-current assets from	-14	-8	-26	-16	-45	-35
acquisitions
- other intangible non-current assets	-3	-2	-5	-3	-8	-6

Statement of comprehensive income
	3 months ending		6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16	30 Jun 17	31 Dec 16
Profit for the period	29	26	58	45	125	112
Components that will be reclassified to
profit for the year
Foreign currency translation
differences for the period	-4	6	-13	10	-8	15
Components that will not be
reclassified to profit for the year
Revaluations of defined benefit	-	1	-	11	-3	8
pension plans
Tax attributable to items not to be	-	0	-	-2	-	-2
reversed in profit or loss
Other comprehensive income	-4	7	-13	19	-11	21
Total comprehensive income	25	33	45	64	114	133
Attributable to:
Equity holders of the Parent Company	25	33	45	64	114	133
Non-controlling interests	-	-	-	-	-	-

Balance sheet, SEKm	30 Jun 17	31 Dec 16	30 Jun 16
Goodwill	627	524	496
Other intangible non-current assets	499	346	277
Property, plant and equipment	71	68	67
Financial non-current assets	15	11	12
Total non-current assets	1,212	949	852
Inventories	278	252	232
Current receivables	316	361	269
Cash and cash equivalents	22	15	13
Total current assets	616	628	514
Total assets	1,828	1,577	1,366
Total equity	725	717	679
Interest-bearing provisions	60	60	62
Non-interest-bearing provisions	73	40	58
Non-current interest-bearing liabilities	7	11	158
Non-current non-interest-bearing liabilities	1	0	0
Total non-current liabilities	141	111	278
Non-interest-bearing provisions	6	6	8
Current interest-bearing liabilities	560	310	89
Current non-interest-bearing liabilities	396	433	312
Total current liabilities	962	749	409
Total equity and liabilities	1,828	1,577	1,366

Statement of change in Group
equity, SEKm		1 Jan 17 – 30 Jun 17		1 Apr 16 − 31 Dec 16		1 Jan 16 – 30 Jun 16
	Equity excl. non controlling interests	Total equity	Equity excl. non controlling interests	Total equity	Equity excl. non- control ling interests	Non- control ling interests	Total equity
Amount at beginning of period	717	717	347	321	321	0	321
Rights issue	-	-	300	300	300	-	300
Issue expenses	-	-	-1	-1	-1	-	-1
Call options issued	-	-	2	-	-	-	-
Repurchase of treasury shares	-	-	-33	-	-	-	-
Dividend	-37	-37	-	-	-	-	-
Change non-controlling interests	-	-	-	-5	-5	-0	-5
Total comprehensive income	45	45	102	64	64	-	64
Amount at the end of the period	725	725	717	679	679	0	679

Cash flow statement	3 months ending		6 months ending			12 months ending
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16	30 Jun 17	31 Dec 16
Profit after financial items	38	35	76	59	159	142
Adjustment for items not included in cash	18	17	39	35	59	55
flow
Income tax paid	-7	-2	-16	-22	-31	-37
Changes in working capital	-12	-56	-15	-63	21	-27
Cash flow from operating activities	37	-6	84	9	208	133
Net investments in non-current assets	-10	-9	-18	-34	-28	-44
Acquisitions and disposals	-	-32	-249	-36	-367	-154
Cash flow from investing activities	-10	-41	-267	-70	-395	-198
Dividend paid to shareholders	-37	-	-37	-277	-37	-277
Rights issue	-	299	-	299	-	299
Repurchase of treasury shares	-	-	-	-	-33	-33
Other financing activities	8	-253	227	-80	263	-44
Cash flow from financing activities	-29	46	190	-58	193	-55
Cash flow for the period	-2	-1	7	-119	6	-120
Cash and cash equivalents at beginning of	22	12	15	130	13	130
period
Exchange differences on cash and cash	2	2	0	2	3	5
equivalents
Cash and cash equivalents at end of the	22	13	22	13	22	15
period

Fair values on financial instruments		30 Jun 2017			31 Dec 2016
SEKm	Carrying amount	Level 2	Level 3	Carrying amount	Level 2	Level 3
Derivatives held for trading purposes	-	-	-	0	0	-
Total financial assets at fair value per level	-	-	-	0	0	-
Derivatives held for trading purposes	1	1	-	-	-	-
Contingent considerations	26	-	26	13	-	13
Total financial liabilities at fair value per level	27	1	26	13	-	13

The fair value and carrying amount are recognized in the balance sheet as shown in the table above. For quoted securities, the fair value is determined on the basis of the asset's quoted price in an active market, level 1. For currency contracts and embedded derivatives, the fair value is determined on the basis of observable market data, level 2. For the Group's other financial assets and liabilities, fair value is estimated to be the same as the carrying amount.

Contingent considerations	3 months ending.		6 months ending		12 months ending.
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16	30 Jun 17	31 Dec 16
Carrying amount, opening	26	6	13	6	17	6
balance
Acquisitions during the year	-	11	13	11	19	17
Consideration paid	-	-	-	-	-6	-6
Reversed through profit or loss	-	0	-	0	-5	-5
Interest expenses	0	0	0	0	1	1
Exchange differences	0	0	-0	0	0	0
Carrying amount, closing balance	26	17	26	17	26	13

Key financial indicators	12 months ending
	30 Jun 17	31 Dec 16	30 Jun 16	31 Mar 16	31 Mar 15**
Net sales, SEKm	2,168	1,938	1,760	1,562	1,057
EBITA, SEKm	218	189	149	135	120
EBITA margin, %	10.1	9.7	8.4	8.7	11.3
Profit growth, EBITA, %	47	47	28	13	4
Return on working capital (P/WC), %	64	62	57	64	94
Profit for the period, SEKm	125	112	82	78	80
Return on equity, %*	18	21	21	25	30
Financial net liabilities, SEKm	605	366	296	538	19
Financial net liabilities/EBITDA, multiple	2.5	1.8	1.8	3.6	0.1
Net debt/equity ratio, multiple*	0.8	0.5	0.4	1.6	0.1
Equity ratio, %*	40	45	50	27	41
Average number of employees	518	452	418	370	284
Number of employees at end of the period	584	545	450	427	286

* Key financial indicators are calculated based on equity that includes non-controlling interests. For definitions of key financial indicators, see below. ** The comparative years have been prepared as combined financial statements. For accounting policies relating to combined financial statements, see AddLife's Annual Report 2015/2016.

.

Key financial indicators per share			12 months ending
	30 Jun 17	31 Dec 16	30 Jun 16	31 Mar 16	31 Mar 15
Earnings per share (EPS), SEK	5.12	4.87	3.99	4.15	5.06
Diluted EPS, SEK	5.12	4.87	-	-	-
Cash flow per share, SEK	8.51	5.79	4.82	6.27	7.58
Shareholders' equity per share, SEK*	29.72	29.40	27.57	17.60	16.46
Average number of shares after repurchases, '000s	24,438	22,950	20,540	18,749	15,892
Average number of shares adjusted for repurchases and dilution, '000s	24,440	22,950	-	-	-
Number of shares outstanding at end of the period, '000s	24,387	24,387	24,617	19,694	15,892

* Calculations based on proportion of equity attributable to the equity holders.

In calculating the average number of shares outstanding it was assumed that the 500,000 shares at the time of AddLife AB's formation were present throughout the reporting periods. Subsequently, the bonus element of the bonus issue carried out in July 2015 was adjusted retroactively. Since there is no listed share price for AddLife during the historical financial years, the bonus issue element was calculated based on a value per share used in the time around the non-cash issue that occurred in connection with the acquisition of Mediplast. The non-cash issue itself, carried out after the three historical financial periods, is assumed in the calculation of earnings per share to have been made at fair value and therefore does not affect earnings per share for the three periods

Parent company summary

Income statement	3 months ending			6 months ending		12 months ending
SEKm	30 Jun 17	30 Jun 16	30 Jun 17	30 Jun 16	30 Jun 17	31 Dec 16
Net sales	7	6	14	11	26	23
Administrative expenses	-10	-10	-21	-23	-37	-39
Operating profit/loss	-3	-4	-7	-12	-11	-16
Profit/loss from shares in group cmpanies	-	-	-	42	33	75
Interest income/expenses and similar	0	-1	1	-2	4	1
items
Profit/loss after financial items	-3	-5	-6	28	26	60
Appropriations	-	-	-	-7	87	80
Profit/loss before taxes	-3	-5	-6	21	113	140
Income tax expense	0	1	1	-5	-8	-14
Profit/loss for the period	-3	-4	-5	16	105	126

Balance sheet, SEKm	30 Jun 17	31 Dec 16	30 Jun 16
Intangible non-current assets	0	0	0
Tangible non-current assets	0	0	0
Non-current financial assets	1,512	1,165	1,001
Total non-current assets	1,512	1,165	1,001
Current receivables	12	151	82
Total current assets	12	151	82
Total assets	1,524	1,316	1,083
Equity	646	688	609
Untaxed reserves	19	19	5
Interest-bearing long-term liabilities	123	65	210
Non-interest-bearing long-term liabilities	1	0	-
Total long-term liabilities	143	84	215
Interest-bearing short-term liabilities	712	514	244
Non-interest-bearing short-term liabilities	23	30	15
Total short-term liabilities	735	544	259
Total equity and liabilities	1,524	1,316	1,083

Note. Pledged assets and contingent liabilities for parent company

SEKm	30 Jun 17	31 Dec 16	30 Jun 16
Pledged assets	40	40	-
Contingent liabilities	-	-	-

Definitions

Return on equity	average equity.	Profit/loss after tax attributable to shareholders, as a percentage of shareholders' proportion of
Profit/loss for the period Average equity Return on equity	2017-06-30 125 704 125/704 = 18%	2016-12-31 112 545 112/545 = 21%	2016-06-30 82 327 82/327 = 25%
Return on working capital (P/WC)	EBITA in relation to average working capital.
Operating profit before amortization of intangible assets EBITA, P	2017-06-30 218	2016-12-31 189	2016-06-30 149
Average working capital (WC) P/WC	349 218/349 = 64%	304 189/304 = 62%	262 149/262 = 57%
EBITA	Operating profit before amortization of intangible assets.
Operating profit Depriciation of intangible assets Operating profit before amortization of intangible assets	2017-06-30 165 53 218	2016-12-31 148 41 189	2016-06-30 113 36 149
EBITA margin	EBITA in percentage of net sales.
Operating profit before amortization of intangible assets Net sales EBITA margin	2017-06-30 218 2,168 218/2,168 = 10.1%	2016-12-31 189 1,938 189/1,938 = 9.7%	2016-06-30 149 1,760 149/1,760 = 8.4%
EBITDA	Operating profit before depreciation and amortization of intangible assets and property, plant and equipment.
Equity per share	the reporting period.	Shareholders' proportion of equity divided by the number of shares outstanding at the end of
Cash flow per share		Cash flow from operating activities, divided by the average number of shares.
Net debt/equity ratio	Financial net liabilities in relation to shareholders' equity.
Earnings per share (EPS)	Shareholders' proportion of profit/loss for the year in relation to the average number of shares outstanding.
Profit growth EBITA	This year's EBITA decreased by previous year's EBITA divided by previous year's EBITA.
Financial net liabilities	Interest-bearing liabilities and interest-bearing provisions, less cash and cash equivalents.
Financial net liabilities/EBITDA	Financial net liabilities divided by EBITDA.
Equity ratio	Equity as a percentage of total assets

The key figures presented above are central in order to understand and evaluate AddLifes business and financial position. The key figures are presented in the "Key financial indicators" table on page 12 and they are commented on pages 1-4.

This information is information that AddLife AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08:00 a.m. CET on July 17, 2017.

AddLife AB (publ), Box 3145, Birger Jarlsgatan 43, SE-103 62 Stockholm. info@add.life, www.add.life, org.nr. 556995-8126