AddLife — Interim / Quarterly Report 2020

Oct 21, 2020

Interim Report 1 January – 30 September 2020

Another strong quarter!

1 JULY – 30 SEPTEMBER 2020 (3 MONTHS)

• Net sales increased by 55 percent to SEK 1,241 million (802), of which organic growth amounted to 48 percent and acquired growth amounted to 12 percent.
• EBITA increased by 209 percent to SEK 199 million (65), corresponding to an EBITA-margin of 16.1 percent (8.1).
• Profit after tax increased by 370 percent to SEK 127 million (27).
• Earnings per share amounted to SEK 1.14 (0.24).
• Cash flow from operating activities amounted to SEK 184 million (61).
• During the quarter, one acquisition has been completed and another one has been signed, which is subject to review decision from Italian authorities. Three more acquistions were completed post quarter end. Expected annual net sales amounts to approximately SEK 375 million. 12 months amounted to 3.13 SEK (1.28). • Cash flow from operating activities amounted to SEK 391 million (225). • The equity ratio was 49 percent (45). • Return on working capital (P/WC) amounted to 81 percent (51). • The Board of directors proposes a dividend of SEK 0.50 per share. Extraordinary

1 JANUARY – 30 SEPTEMBER 2020 (9 MONTHS)

• Net sales increased by 42 percent to SEK 3,542 million (2,491), of which organic growth amounted to 33 percent and acquired growth amounted to 12 percent.
• EBITA increased by 139 percent to SEK 486 million (203), corresponding to an EBITA-margin of 13.7 percent (8.1).
• Profit after tax increased by 224 percent to SEK 301 million (93).

• Earnings per share amounted to SEK 2.69 (0.84). Earnings per share for the last

• general meeting will be held at 19 November 2020.

	3 months ending			9 months ending	12 months ending
SEKm								30-Sep-20 30-Sep-19 change 30-Sep-20 30-Sep-19 change 30-Sep-20 31-Dec-19
Net sales	1,241	802	55%	3,542	2,491	42%	4,530	3,479
EBITA	199	65	209%	486	203	140%	588	305
EBITA-margin, %	16.1%	8.1%		13.7%	8.1%		13.0%	8.8%
Profit before tax	165	34	385%	383	115	233%	450	182
Profit for the period	127	27	370%	301	93	224%	350	142
Earnings per share before dilution, SEK	1.14	0.24	375%	2.69	0.84	220%	3.13	1.28
Earnings per share after dilution, SEK	1.13	0.24	371%	2.68	0.84	219%	3.12	1.28

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 in Europe. The Group is divided into two business areas: Labtech and Medtech. The Group comprises some 50 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.

EBITA GROWTH

Q3 2020

Comments by the CEO

business concept is to provide added value to our customers, of our products and solutions, will be able to improve and save been able to contribute to healthcare in these difficult times.

The third quarter is normally our weakest quarter, but this year, we are tallying up a record-breaking quarter. The demand, especially from health services and diagnostic laboratories, remained extremely high throughout the quarter even though the number of seriously ill COVID-19 patients declined in most countries during the summer.

Our companies have done a fantastic job of supporting the customers and have delivered large volumes of critical products the third quarter through considerably increased volumes and continued restrained expenses.

Sales for the quarter increased by 55 percent to SEK 1,241 million, of which organic growth was 48 percent. EBITA increased by 209 percent to SEK 199 million and EBITA margin amounted to 16.1 percent. Accumulated for the interim period, sales increased by 42 percent to SEK 3,542 million and EBITA rose by 140 percent to SEK 486 million. We estimate that SEK 800 million, hence the underlying business shows continued growth. We have a strong cash flow from operating activities both in the qaurter and accumulated, which strengthens our ability to continue on our growth journey. remedied in the third quarter and we have delivered large

The business situation in all of our markets has been impacted by the pandemic and the actions of the different countries to reduce the spread of infection. Most European countries have expanded their test capacity for COVID-19 and the testing is expected to continue over a long period of time. This development has led to strongly increased sales in our diagnostic companies.

The enormous shortage of medical equipment has been volumes of quality-approved medical device products and personal protective equipment to Swedish and Norwegian customers. Meanwhile, hospitals have built up some stockpile for personal protective equipment in particular, for which reason we expect lower demand for these products in the coming quarters. In general, patients have chosen to abstain from non-acute

healthcare and the number of elective surgeries continues to be lower than normal. In September we saw signs that activity has increased. However, we see a clear risk of setbacks in elective surgical procedures, depending on how COVID-19 is spreading. The huge queues for medical care that we see in many countries will unfortunately take a long time to handle, but the patient needs remains and the demand will be great moving forward.

As more and more research laboratories have reopened after the shutdown in the previous quarter, activity has returned to normal. Research teams working on COVID-19 projects are receiving increased funding and demand has been high for both instruments and various research reagents related to virus research. Sales to our pharmaceutical customers have been stable. Sales of our own advanced instruments in the US and China, however, have been lower than in previous years.

Despite the challenging business situation for our companies in home care, sales growth has been favorable. Demand and the need for increased and safe eldercare are continuously strong, but the infection preventive measures have caused delays in deliveries for several projects in the third quarter. Some restrictions were eased in September, which allowed delivery of adapted bathroom aids to new senior housing facilities.

New sales projects, customer visits and product installation have been a challenge this year. The majority of our employees continue to work from home, meeting customers and business partners digitally. There have been fewer procurement processes in our markets during the interim period compared to previous years and customers have chosen to extend existing contracts or engaged in direct procurement to quickly gain access to critical products. Given the challenges and opportunities we have in our business, I am very proud of our employees, who have been doing an outstanding job in a difficult time. The creativity and commitment in our companies is huge, enabling AddLife to continue to achieve success in the market. Increased acquisition activity potential. This work has been affected by the COVID-19 pandemic and during spring we decided to put several ongoing for patients with chronic pulmonary diseases and the same markets and sells advanced surgical products in Italy. Closing of

AddLife is constantly searching for interesting new acquisition candidates and suppliers with Nordic and European acquisition discussions on hold. These discussions resumed during summer and in the quarter we acquired TechniPro PulmoMed in Australia to the business area Medtech, and also signed an agreement for the acquisition of SIAD Healthcare in Italy. Together with EuroClone, which was acquired in the first

TechniPro PulmoMed markets and sells products to care agency is already distributed in the Nordics. SIAD Healthcare the acquisition is subject to review by the Italian authorities and we expect a decision in the fourth quarter.

After the quarter, three additional acquisitions were added to the Medtech business area: Ropox in Denmark and Zafe Care Systems in Sweden, both of which are active in home care, as well as Dach Medical Group in Austria, active in advanced surgery.

quarter, this year's acquisitions have an expected annual net sales of SEK 655 million.

Kristina Willgård President and CEO

Group development in the quarter

Net sales in the quarter increased by 55 percent to SEK 1,241 million (802). Organic growth was 48 percent and acquired growth totalled 12 percent. Exchange rate changes had a negative impact on net sales of 5 percent, corresponding to SEK 41 million. EBITA increased by 209 percent to SEK 199 million (65) and EBITA-margin amounted to 16.1 percent (8.1). The higher margin is due increased volumes and restrained costs. The Group's EBITA has not been impacted by governmental support or other contributions related to COVID-19 pandemic. Received contributions have been fully provided for and are being reimbursed. Exchange rate changes had a negative effect on EBITA, corresponding to SEK 5 million. Net financial items amounted to SEK -4 million (-2) and profit after financial items amounted to SEK 165 million (34). Profit after tax for the quarter increased with 370 percent amounting to SEK 127 million (27) and the effective tax rate was 23 percent (22).

Group development in the interim period

Net sales in the interim period increased by 42 percent to SEK 3,542 million (2,491). Organic sales increased by 33 percent and acquired growth totalled 12 percent. Exchange rate changes had a negative effect on net sales of 3 percent, corresponding to SEK 68 million. EBITA increased by 139 percent to SEK 486 million (203) and EBITA-margin amounted to 13.7 percent (8.1). The higher margin is due to increased volumes and restrained costs. The Group's EBITA has not been impacted by governmental support or other contributions related to COVID-19 pandemic. Received contributions have been fully provided for and are being reimbursed. Exchange rate changes had a negative effect on EBITA of 4 percent, corresponding to SEK 9 million. Net financial items amounted to SEK -11 million (-8) and profit after financial items increased by 233 percent to SEK 383 million (115). Profit after tax for the period increased by 224 percent to SEK 301 million (93) and the effective tax rate was 21 percent (19). The difference in effective tax is due to last year's non-taxable income and revaluation of deferred tax in Norway. 2016 2017 2018 2019 2020

Development in the business areas

Labtech

Companies in the Labtech business are active in the market areas diagnostics, biomedical research and laboratory equipment.

3 months ending					9 months ending	12 months ending
SEKm	30-Sep-20	30-Sep-19		change 30-Sep-20	30-Sep-19	change	30-Sep-20	31-Dec-19
Net sales	727	445	63%	2,056	1,413	45%	2,624	1,981
EBITA	131	41	219%	312	132	136%	382	202
EBITA-margin, %	18.1%	9.3%		15.2%	9.3%		14.6%	10.2%

Labtech's net sales increased by 63 percent in the third quarter to SEK 727 million (445), of which organic growth increased by 49 percent, acquired growth totalled 19 percent and exchange rate changes had a negative effect of 4 percent. EBITA increased by 219 percent to SEK 131 million (41), corresponding to an EBITA-margin of 18.1 percent (9.3).

Labtech's net sales increased by 45 percent in the interim period to SEK 2,056 million (1,413), of which organic growth increased by 29 percent, acquired growth totalled 18 percent and exchange rate changes had a negative effect of 2 percent. EBITA increased by 136 percent to SEK 312 million (132), corresponding to an EBITA-margin of 15.2 percent (9.3).

The Labtech business area has undergone strong growth in all geographic markets. The increase in the third quarter in diagnostics companies is mainly related to certified COVID-19 tests. In all countries, intensive testing of citizens for COVID-19 is carried out and several countries plan to continue testing for a long time. Our companies mainly offer so-called PCR tests used to detect ongoing infection, from several different suppliers. Customer demand continues to be significantly higher than the supply, due to suppliers prioritising their home market. During the quarter, sales of for example bloodgas was lower and back to more normal volumes, since fewer COVID-19 patients were admitted to hospital ICU wards. Also other tests, for example for Alzheimer's and hematology, declined during the pandemic, as a consequense of patients choosing not to seek healthcare. As activity increases in healthcare sales is expected to be normalised. Growth in the quarter in diagnostics has been strongest in Denmark, Finland, Norway, Poland, Romania and Austria.

More and more research laboratories have reopened during the quarter and demand has been strong in our niche research companies in the Nordic region and Italy. Many research teams are working on various COVID-19-related projects and they have received increased funding for their research from both private and public sources, resulting in high demand for various products. Despite the strong focus on virus research, underlying sales to other research areas and pharmaceutical companies are also performing well. However, sales have been weaker to veterinary and foods customers, as have sales of our advanced instruments in material analysis to academic customers in China and the US.

Medtech

Companies in the Medtech business provides medical device products within the medtech market and assistive equipment within home healthcare.

3 months ending				9 months ending	12 months ending
SEKm	30-Sep-20	30-Sep-19		change 30-Sep-20	30-Sep-19	change	30-Sep-20	31-Dec-19
Net sales	514	357	45%	1,486	1,078	38%	1,906	1,498
EBITA	72	26	177%	185	79	112%	222	116
EBITA-margin, %	14.0%	7.3%		12.4%	7.3%		11.6%	7.7%

For the quarter, Medtech's net sales increased by 45 percent to SEK 514 million (357), including organic growth of 47 percent and acquired growth of 3 percent, while exchange rate fluctuations had a negative effect of 5 percent. EBITA rose 177 percent to SEK 72 million (26) and EBITA margin amounted to 14.0 percent (7.3).

For the interim period, Medtech's net sales increased by 38 percent to SEK 1,486 million (1,078), including organic growth of 36 percent and acquired growth of 5 percent, while exchange rate fluctuations had a negative effect of 3 percent. EBITA rose 134 percent to SEK 185 million (79) and EBITA margin amounted to 12.4 percent (7.3).

The Medtech business has shown strong growth during the quarter, especially in the Nordic countries. We have delivered extremely large volumes of medical device products and personal protective equipment to meet the needs of hospitals and its employees' needs to create a safe working environment with respect to COVID-19. Since fewer seriously ill COVID-19 patients have been treated during the quarter, the hospitals have been able to build up their own inventory to be prepared for future expected outbreaks. We therefore expect that sales of COVID-19-related products will decline in the coming quarters. The exceptional situation that arose within health care in several countries during the pandemic with challenges regarding secure delivery chains, product quality, and stockpiled supplies has led to in-depth and rewarding discussions with several of our larger customers regarding future collaborations.

Patients have generally been cautious about seeking medical care and the number of elective surgical procedures continues to be lower than usual. Care providers in several countries have also recommended that patients should not seek care for non-acute illnesses during the pandemic. Hence, the overall demand for our non COVID-19 related products have been lower than usual. However, at the end of the quarter, we saw increased sales in several product segments attributable to normal medical care and elective procedures and demand and needs are high as care queues have increased to record levels during the pandemic. It will take a long time for most countries to deal with the long queues. Unfortunately, we see a clear risk of setbacks in elective surgical procedures, depending on how COVID-19 is spreading.

It is gratifying, that our home care companies have had positive sales growth during the quarter. The business situation is challenging, as it has been difficult to carry out customer visits, testing of products and installations of welfare technology to the extent that both we and the customers would have desired. Visitor restrictions for external people to senior housing facilities have caused delays in deliveries for several projects in the third quarter. At the end of the quarter we were able to deliver adapted bathroom-related assistive devices to newly built senior housing facilities in Sweden. In Finland the market continues to be weaker. We hope that in the coming quarter we will be able to begin to fulfill several of the municipal contracts that we received in Norway regarding welfare technology, though we need to adapt to the development of COVID-19 here as well.

In the quarter we acquired TechniPro PulmoMed in Australia, and also signed an agreement for the acquisition of SIAD Healthcare in Italy. After the quarter, as of 1 October, three additional acquisitions were added to the business area: Ropox in Denmark, Dach Medical Group in Austria and Zafe Care Systems in Sweden. The acquired annual net sales is expected to amount to approximately SEK 655 million.

Financial position and cash flow

At the end of the interim period the equity ratio stood at 49 percent (45). Equity per share totaled SEK 15.54 (13.07) and the return on equity at the end of the interim period was 22 percent (10). Return on working capital, P/WC (EBITA in relation to working capital) amounted to 81 percent (51). The increase is mainly due to the increased EBITA result.

The Group's interest-bearing net debt at the end of the interim period totalled SEK 814 million (902), including pension liabilities of SEK 80 million (80) and leasing liabilities of SEK 220 million (216). The net debt/equity ratio, calculated on the basis of net debt including provisions for pensions and leasing liability, totalled 0.5 compared to 0.6 at the beginning of the interim period.

Cash and cash equivalents, consisting of cash and bank balances, together with approved but non-utilised credit facilities, totalled SEK 828 (439) million on 30 September 2020. The increase in cash and cash equivalents was due to AddLife signing new credit arrangements with Handelsbanken and Danske Bank and therefore increased available credits with additional SEK 200 million to a total of SEK 1,200 million.

Cash flow from operating activities reached SEK 391 million (225) during the interim period. The increased sales has led to tied up captial in trade receivables and inventories to guarantee future deliveries. Acquisitions of companies amounted to SEK 74 million (290). Investments in non-current assets during the interim period amounted to SEK 61 million (56). Disposals of non-current assets amounted to SEK 6 million (3). Repurchase of treasury shares amounted to SEK 31 million (43). Exercised and issued call options amounted to SEK 39 million (12) and paid dividend was SEK 0 million (62). Long term financial goals

Average profit growth since listing in March 2016 amounts to 39 percent

Acquisitions

Acquisitions completed from the 2019 financial year are distributed among the Group's business areas as follows:

		Net	Number of	Business
Acquisitions	Time	Sales,	employees*	area
Business from Wellspect HealthCare, Sweden	April, 2019	170	14	Medtech
Lab-Vent Controls A/S och Koldt & Ryø El A/S, Denmark	August, 2019	52	20	Labtech
Fysionord i Sollefteå AB, Sweden	September, 2019	6	2	Medtech
Funksjonsutstyr AS, Norway	December, 2019	50	7	Medtech
EuroClone S.p.A, Italy	January 2020	280	58	Labtech
TechniPro PulvoMed Pty Ltd, Australia	September, 2020	13	5	Medtech
Ropox A/S, Denmark	October, 2020	95	73	Medtech
Dach Medical Group Holding AG, Austria	October, 2020	145	23	Medtech
Zafe Care Systems AB, Sweden	October, 2020	35	21	Medtech
* Refers to conditions at the time of acquisition on a full-year basis.		846	223

On 28 November 2019 AddLife signed an agreement on the acquisition of 100 percent of the shares in EuroClone S.p.A, the acquisition became effective as of 8 January 2020. The company is expected to contribute about SEK 280 million to annual sales. The Italian EuroClone is a leading supplier of instruments and consumables in the field of cell and molecular biology in Italy. The acquisition represents AddLife's entry into the Italian market in a segment in which the company is already an established supplier in the Nordic market.

On August 31 2020 AddLife signed an agreement on the acquisition of all the shares in the Australian entity Technipro-Pulmomed Pty Limited to the business area Medtech. The company has five employees and annual net sales of SEK 13 million. The company is a distributor of medical devices i.a for chronic respiratory diseases, same agency as on the Nordic markets. The company will be integrated to our existing company in Australia.

The effect of the acquisitions on the AddLife Group's net sales was SEK 228 million, on EBITA SEK 19 million, on operating profit SEK 14 million and on profit after tax for the interim period SEK 7 million.

The fair value of not yet paid contingent consideration for acquisitions made during the interim period is calculated to SEK 14 million, which is approximately 84 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 interim period 2020 were as follows:

Fair value
80
13
35
105
-21
-148
64
45
109
-21
-14
74

1) The consideration is stated excluding acquisition expenses.

Transaction costs for the acquisitions totalled SEK 4 million and are recognized as selling expenses.

On 18 September 2020 AddLife signed an agreement with SIAD Healthcare s.p.a to acquire their business in the product area of advanced surgery. In conjunction with the acquisition, the business will be transferred to a newly formed company, which AddLife is acquiring. The business has 17 employees and annual sales of approximately EUR 8 million. Possession is subject to a review and decision on foreign direct investments by Italian authorities, which has not been receieved at the end of the interim period.

The Share

The share capital at the end of the interim period amounted to SEK 58 million (58).

At the annual general meeting on May 7, 2020, it was resolved on a share split 4:1. After the split the total number of shares amounts to 114,498,292 of which 4,625,216 Class A shares and 109,873,076 Class B shares. The new shares were registered on the shareholder's accounts on May 29, 2020. Since the share split the numbers of share owners has increased with approximately 30 percent and the average number of transactions per day have increased by approximately 300 percent.

The number of repurchased own shares amounts to 2,256,110 Class B, corresponding to 2.0 percent of the total number of shares and 1.4 percent of the votes. The average purchase price for shares held in treasury amounts to SEK 52.12 per share. The average number of treasury shares held during the interim period was 2,271,999 (1,795,986). The share price at 30 September 2020 was SEK 139.12 and the most recent price paid for the AddLife share on 20 October 2020 was SEK 141.00.

Turnover and trading	Jan-Sep 2020
Lowest price, SEK	59.75
Highest price, SEK	153.00
Average daily turnover, SEK	8,181,495
Number of traded shares, no	14,778,200
Number of transactions, no	76,823

AddLife has four outstanding call option programmes totalling 2,925,152 Class B shares. Issued call options for treasury shares have resulted in a calculated dilution effect based on average share price for the year of approximately 0.4 percent (0.1). 127,212 options out of 215,000 options from the 2017/2021 program have been exercised during the period, corresponding to 508,848 B-shares.

Totalt	722,788	2,925,152
2017/2021	87,788	351,152	0.0%	53.20	16 Jun 2020 – 28 Feb 2021
2018/2022	170,000	714,000	0.6%	56.00	16 Jun 2021 – 28 Feb 2022
2019/2023	215,000	860,000	0.8%	76.60	20 Jun 2022 – 28 Feb 2023
2020/2024	250,000	1,000,000	0.9%	98.40	19 jun 2023 - 28 feb 2024
program	options	B-shares	shares	price	Expiration period
Outstanding	Number of	number of	Proportion of total	Exercise
		Corresponding

On 30 September the number of share holdes amounted to 6,283, where of 52 percent are Swedish owners with respect to capital share. The 10 biggest shareholders controlled 57 percent of number of capital and 67 percent of votes.

			Share in %
Shareholders 2020-09-30	Class A-shares	Class B-shares	of capital	of votes
Roosgruppen AB	2,156,572	7,090,564	8.08	18.36
Tom Hedelius	2,066,572	23,140	1.83	13.25
Verdipapirfond Odin	0	11,037,084	9.64	7.07
SEB Fonder	0	9,745,047	8.51	6.22
Swedbank Fonder	0	8,527,740	7.45	5.03
State Street Bank & Trust Company	0	8,392,280	7.33	5.52
NTC Fidelity Funds Northern Trust	0	6,478,044	5.66	4.15
J.P. Morgan Chase & Co	0	4,597,647	4.02	2.94
Sandrew AB	0	2,800,000	2.45	2.21
Lannebo Fonder	0	2,790,375	2.44	1.84
Total the 10 biggest shareholders	4,223,144	61,481,921	57.38	66.59
Other shareholders	402,072	46,135,045	40.64	31.96
Total outstanding shares	4,625,216	107,616,966	98.03	98.55
Repurchased own shares Class B	-	2,256,110	1.97	1.45
Total registered shares	4,625,216	109,873,076	100.00	100.00
Source: Euroclear

AddLife Interim period 1 January–30 September 2020 8

Employees

At the end of the interim period, the number of employees was 988, compared to 932 at the beginning of the interim period. During the period, the acquisitions have led to an increase of 63 employees. The average number of employees for the last 12 month period was 965 (903).

Parent company

The Parent Company's net sales for the interim period amounted to SEK 32 million (28) and profit after financial items amounted to SEK -1 million (-3). At the end of the interim period, the Parent Company's net financial debt amounted to SEK 447 million (660). The share capital at the end of the interim period was SEK 58 million (58).

Accounting policies

This interim report was prepared in accordance with IFRS 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 Entities of the Swedish Financial Reporting Board. The accounting policies and basis for calculations applied in the 2019 annual report for AddLife AB were also used in the interim report. The amendments to IFRSs applicable from January 1, 2020 have no effects to AddLife's financial reports for the interim period ended September 30, 2020.

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 as 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 financial position and earnings took place during the interim period.

Nomination committee

The 2020 Annual General Meeting authorised the Board Chairman to establish a nomination committee for upcoming elections to the Board, by appointing members from among representatives of the five shareholders who controlled the largest number of votes in the Company at 30 September 2020, to serve with the Chairman on the nomination committee. In accordance with the above, the Committee comprises these appointed members: Johan Sjö, (Chairman of the Board), Stefan Hedelius (appointed by Tom Hedelius), Håkan Roos (appointed by RoosGruppen AB), Jonathan Schönbäck (appointed by Odin Fonder), Christofer Geijer (appointed by SEB Investment Management) and Natalie Falkman (appointed by Swedbank Robur Fonder). Information on how to contact the Nomination Committee is available on the AddLife website, www.add.life/en/investors/. All of the shares in the Danish company bolaget Ropox A/S. The entity develops, designs and produces aids for elderly

Events after the end of the interim period

On 1 October AddLife signed three acquisitions to the business area Medtech:

• people and others with special needs. The company has 73 employees and annual net sales of approximately DKK 65 million.
• All of the shares in Dach Medical Group to the business area Medtech. The group is operating in Austria, Switzerland and Germany within the product area advanced surgery. The company has 23 employees and annual net sales of EUR 14 million.
• All of the shares in Zafe Care systems AB. The company is a well-established provider of welfare technology. The enity has 21 employees and annual net sales of SEK 34 million.

No other events of significance to the Group occurred after the end of the interim 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 (page 32-36), in AddLife's annual report 2019. The Parent Company is indirectly affected by the above risks and uncertainties through its function in the Group.

Stockholm 21 October 2020

Kristina Willgård President and CEO

Conference call

Investors, analysts and the media are invited to a conference call where CEO Kristina Willgård and CFO Martin Almgren will present the interim report. The presentation will be held in English 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 21 October 2020 The presentation will be available via the following link: https://5569958126.globalmeet.com/MartinAlmgren2 Please call on: +46 8 22 90 90 code: 327497 The presentation is also available on AddLife's YouTube channel, see link: AddLife YouTube

Proposal to extraordinary general meeting, 19 November 2020

Extraordinary general meeting will be held in Stockholm, Downtown Camper by Scandic, Brunkebergstorg 9, on 19 november 2020 at 1.00 p.m (CET)

At the annual general meeting on 7 May 2020 it was decided in accordance with the Boards changed proposal that no dividend should be distributed to the shareholders in the light of the general uncertainties around COVID-19 and the preventive infection measures. The board already then saw an opportunity to call for an extraordinary general meeting later this year depending on the development. Over the last couple of months uncertainties have declined, eventhough there is still reason to be restrained. Hence, The Board have decided to propose a dividend of SEK 0.50 per share.

Financial calendar

Extraordinary general meeting will be held 19 November 2020, at 1 p.m, Stockholm The Year-end report for the period 1 January - 31 December 2020 will be published on 3 February 2021. The interim report for 1 January - 31 March 2021 will be published on 28 April 2021 The Annual General Meeting (AGM) of AddLife AB (publ) will be held on 5 May 2021, 4 PM, Stockholm The interim report for 1 January - 30 June 2021 will be published on 15 July 2021

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

Review report

AddLife AB (publ)

Corp. Id. 556996-8126

Introduction

We have reviewed the condensed interim financial information (interim report) of AddLife AB (publ) as of 30 September 2020 and the nine-month period then ended. The Board of Directors and the Managing Director are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and other generally accepted auditing practices and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

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

Stockholm 21 October 2020

KPMG AB KPMG AB

Håkan Olsson Reising Jonas Eriksson Authorized Public Accountant Authorized Public Accountant Auditor in charge

Business areas

Net sales by business area			2020				2019
Quarterly data, SEKm	Q3	Q2	Q1	Q4	Q3	Q2	Q1
Labtech	727	718	611	568	445	464	504
Medtech	514	530	442	420	357	380	341
AddLife Group	1,241	1,248	1,053	988	802	844	845
EBITA by business area			2020				2019
Quarterly data, SEKm	Q3	Q2	Q1	Q4	Q3	Q2	Q1
Labtech	131	109	72	70	41	39	52
Medtech	72	76	37	37	26	31	22
Parent Company and Group items	-4	-4	-3	-5	-2	-2	-4
EBITA	199	181	106	102	65	68	70
Depreciation intangible assets	-30	-30	-32	-29	-29	-26	-25
Operating profit	169	151	74	73	36	42	45
Finance income and expenses	-4	-2	-5	-6	-2	-4	-2
Profit after financial items	165	149	69	67	34	38	43

Net sales by revenue type	3 months ending 9 months ending					12 months ending
SEKm	30-Sep-20	30-Sep-19	30-Sep-20	30-Sep-19	30-Sep-20	31-Dec-19
Products
Labtech	524	299	1,523	1,002	1,889	1,368
Medtech	441	307	1,289	941	1,658	1,310
The Group	965	606	2,812	1,943	3,547	2,678
Instruments
Labtech	163	101	404	290	545	431
Medtech	68	43	180	119	218	157
The Group	231	144	584	409	763	588
Service
Labtech	41	45	131	121	192	182
Medtech	4	7	15	18	28	31
The Group	45	52	146	139	220	213
Total	1,241	802	3,542	2,491	4,530	3,479

Net sales by business area	3 months ending			9 months ending			12 months ending
SEKm	30-Sep-20		% 30-Sep-19	30-Sep-20		% 30-Sep-19	30-Sep-20		% 31-Dec-19
Labtech	727	63	445	2,056	45	1,413	2,624	32	1,981
Medtech	514	45	357	1,486	38	1,078	1,906	28	1,498
AddLife Group	1,241	55	802	3,542	42	2,491	4,530	30	3,479

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

	3 months ending			9 months ending				12 months ending
SEKm	30-Sep-20		% 30-Sep-19		% 30-Sep-20		% 30-Sep-19		% 30-Sep-20		% 31-Dec-19	%
Labtech	131	18.1		41 9.3	312	15.2	132	9.3	382	14.6	202 10.2
Medtech	72	14.0		26 7.3	185	12.4		79 7.3	222	11.6	116	7.7
Parent Company and Group items	-4		-2		-11		-8		-13		-13
EBITA	199	16.1		65 8.1	486	13.7	203	8.1	588	13.0	305	8.8
Depreciations of intangible non-current assets	-30		-29		-93		-80		-122		-109
Operating profit	169	13.6		36 4.5	394	11.1	123	4.9	467	10.3	196	5.6
Financial income and expenses	-4		-2		-11		-8		-16		-14
Profit after financial items	165		34		383		115		451		182

Consolidated income statement, condensed

Income statement		3 months ending		9 months ending	12 months ending
SEKm					30-Sep-20 30-Sep-19 30-Sep-20 30-Sep-19 30-Sep-20 31-Dec-19
Net sales	1,241	802	3,542	2,491	4,530	3,479
Cost of sales	-811	-522	-2,331	-1,632	-2,980	-2,281
Gross profit	430	280	1,211	859	1,550	1,198
Selling expenses	-188	-194	-625	-576	-826	-777
Administrative expenses	-64	-54	-184	-170	-247	-233
Research and Development	-5	-5	-16	-17	-23	-24
Other operating income and expenses	-4	9	8	27	13	32
Operating profit	169	36	394	123	467	196
Financial income and expenses	-4	-2	-11	-8	-17	-14
Profit after financial items	165	34	383	115	450	182
Tax	-38	-7	-82	-22	-100	-40
Profit for the period	127	27	301	93	350	142
Attributable to:
Equity holders of the Parent Company	126	26	300	92	349	141
Non-controlling interests	1	1	1	1	1	1
Earnings per share (EPS) before dilution, SEK	1.14	0.24	2.69	0.84	3.13	1.28
Earnings per share (EPS) after dilution, SEK	1.13	0.24	2.68	0.84	3.12	1.28
Average number of shares after repurchases '000s	112,226	112,446	112,053	110,693	112,154	111,083
Number of shares at end of the period, '000	112,242	112,237	112,242	112,237	112,242	111,297
EBITA	199	65	486	203	588	305
Depreciations included in operating expenses
- property, plant and equipment	-34	-30	-105	-90	-139	-124
- intangible non-current assets from acquisitions	-24	-25	-78	-67	-103	-92
- other intangible non-current assets	-6	-4	-14	-13	-18	-17

Statement of comprehensive income	3 months ending			9 months ending	12 months ending
SEKm					30-Sep-20 30-Sep-19 30-Sep-20 30-Sep-19 30-Sep-20 31-Dec-19
Profit for the period	127	27	301	93	350	142
Components that may be reclassified to profit for the period
Foreign currency translation differences for the period	0	6	-30	46	-56	20
Components that will not be reclassified to profit for the period
Revaluations of defined benefit pension plans	-	-15	-	-15	3	-12
Tax attributable to items not to be reversed in profit or loss	-	3	-	3	0	3
Other comprehensive income	0	-6	-30	34	-53	11
Total comprehensive income	127	21	271	127	297	153
Attributable to:
Equity holders of the Parent Company	126	21	270	126	296	152
Non-controlling interests	1	1	1	1	1	1

Consolidated Balance sheet, Condensed, SEKm	30-Sep-20	31-Dec-19	30-Sep-19
Goodwill	1,007	972	964
Other intangible non-current assets	783	789	783
Property, plant and equipment	364	353	345
Financial non-current assets	24	24	34
Total non-current assets	2,178	2,138	2,126
Inventories	553	452	471
Current receivables	792	585	566
Cash and cash equivalents	76	99	85
Total current assets	1,421	1,136	1,122
Total assets	3,599	3,274	3,248
Total equity	1,754	1,476	1,456
Interest-bearing provisions	106	104	114
Non-interest-bearing provisions	118	127	118
Non-current interest-bearing liabilities	179	150	130
Non-current non-interest-bearing liabilities	1	1	2
Total non-current liabilities	404	382	364
Non-interest-bearing provisions	7	3	3
Current interest-bearing liabilities	605	747	823
Current non-interest-bearing liabilities	829	666	602
Total current liabilities	1,441	1,416	1,428
Total equity and liabilities	3,599	3,274	3,248

	1 Jan 20 – 30 Sep 20			1 Jan 19 – 31 Dec 19
Statement of change in Group equity, SEKm	Equity excl. non controlling interests	Non controlling interests	Total equity	Equity excl. non controlling interests	Non controlling interests	Total equity
Amount at beginning of period	1,467	9	1,476	931	1	932
Right Issue	-	-	-	490	-	490
Exercised and issued call options	40	-	40	12	-	12
Repurchase of treasury shares	-31	-	-31	-43	-	-43
Dividend	-	-2	-2	-62	-2	-64
Non-controlling interests	-	-	-	-13	9	-4
Total comprehensive income	270	1	271	152	1	153
Amount at the end of the period	1,746	8	1,754	1,467	9	1,476

Cash flow statement, condensed		3 months ending		9 months ending		12 months ending
SEKm					30-Sep-20 30-Sep-19 30-Sep-20 30-Sep-19 30-Sep-20 31-Dec-19
Profit after financial items	165	34	383	115	450	182
Adjustment for items not included in cash flow	81	74	229	181	287	239
Income tax paid	-20	-14	-52	-43	-61	-52
Changes in working capital	-43	-33	-169	-28	-110	31
Cash flow from operating activities	183	61	391	225	566	400
Net investments in non-current assets	-20	-20	-55	-53	-84	-82
Acquisitions and disposals	-8	-123	-74	-290	-109	-325
Cash flow from investing activities	-28	-143	-129	-343	-193	-407
Dividend paid to shareholders	-	0	-	-62	-	-62
Exercised and issued call options	8	4	40	12	40	12
Right Issue	-	-	-	491	-1	490
Repurchase of treasury shares	-	-43	-31	-43	-31	-43
Other financing activities	-141	135	-288	-264	-379	-355
Cash flow from financing activities	-133	96	-279	134	-371	42
Cash flow for the period	22	14	-17	16	2	35
Cash and cash equivalents at beginning of period	54	69	99	61	85	61
Exchange differences on cash and cash equivalents	0	2	-6	8	-11	3
Cash and cash equivalents at end of the period	76	85	76	85	76	99

Fair values on financial instruments	30-Sep-20			31-Dec-19
SEKm	Carrying amount	Level 2	Level 3	Carrying amount	Level 2	Level 3
Derivatives measured at fair value through profit or loss	0	0	0	0	0	-
Total financial assets at fair value per level	0	0	0	0	0	-
Derivatives measured at fair value through profit or loss	1	1	0	1	1	-
Contingent considerations	31	-	31	18	-	18
Total financial liabilities at fair value per level	32	1	31	19	1	18

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. As at the reporting date the Group had no items in this category.

For currency contracts and embedded derivatives, the fair value is determined on the basis of observable market data, level 2.

For contingent considerations, a cash-flow-based valuation is performed, which is not based on observable market data, level 3. 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		9 months ending	12 months ending
SEKm					30-Sep-20 30-Sep-19 30-Sep-20 30-Sep-19 30-Sep-20 31-Dec-19
Carrying amount, opening balance	31	8	18	9	9	9
Acquisitions during the period	-	0	14	0	32	18
Consideration paid	-	-	-	-	-	-
Reversed through profit or loss	-	-7	-	-9	-9	-9
Interest expenses	-	-	-	0	-	0
Exchange differences	-	-1	-1	0	-1	0
Carrying amount, closing balance	31	0	31	0	31	18

	12 months ending
Key financial indicators					30-Sep-20 31-Dec-19 30-Sep-19 31-Dec-18 31-Dec-17 31-Dec-16
Net sales, SEKm	4,530	3,479	3,176	2,482	2,333	1,938
EBITA, SEKm	588	305	276	245	234	189
EBITA margin, %	13.0%	8.8%	8.7%	9.9%	10.0%	9.7%
Profit growth, EBITA, %	113%	25%	10%	5%	24%	47%
Return on working capital (P/WC), %	81%	51%	51%	62%	63%	62%
Profit for the period, SEKm	348	142	138	129	120	112
Return on equity, %	22%	10%	11%	16%	17%	21%
Financial net liabilities, SEKm	814	902	982	882	588	366
Financial net liabilities/EBITDA, multiple	1.1	2.1	3.2	3.3	2.3	1.8
Net debt/equity ratio, multiple	0.4	0.6	0.7	0.9	0.8	0.5
Equity ratio, %	49%	45%	45%	35%	40%	45%
Average number of employees	965	903	828	620	579	452
Number of employees at end of the period	988	932	927	873	592	545

Key indicators include IFRS 16 from 2019, comparative figures have not been restated. For definitions of key financial indicators, see page 17.

	12 months ending
Key financial indicators per share		30-Sep-20 31-Dec-19 30-Sep-19 31-Dec-18 31-Dec-17 31-Dec-16
Earnings per share (EPS), SEK	3.13	1.28	1.27	1.29	1.19	1.22
Diluted EPS, SEK	3.12	1.28	1.27	1.29	1.19	1.22
Cash flow per share from operating activities, SEK	5.06	3.61	2.33	1.76	2.05	1.39
Shareholders' equity per share, SEK	15.54	13.07	13.38	9.08	7.43	7.06
Average number of shares after repurchases, '000s	112,099	111,083	108,088	100,458	101,302	97,729
Average number of shares adjusted for repurchases and dilution, '000s	112,434	111,297	108,220	100,458	101,302	97,729
Number of shares outstanding at end of the period, '000s	112,242	112,237	112,237	102,586	100,682	101,577

The number of shares from a historical perspective has been restated to take the bonus issue into account (i.e. the value of the subscription right) in the completed new share issue in 2019, as well as the share split (1:4) completed in May 2020 and has been used in all calculations of metrics for SEK per share. The conversion factor is 4.041.

Pledged assets and contingent liabilities in the Group, SEKm	30-Sep-20	31-Dec-19	30-Sep-19
Contingent liabilities	43	42	42

Reconciliation key ratios

Return on equity

Profit/loss after tax attributable to shareholders, as a percentage of shareholders' proportion of average equity.

	30-Sep-20	31-Dec-19	30-Sep-19
Profit/loss for the period (roll 12 months)	350	142	138
Average equity	1,605	1,362	1,225
Return on equity	350/1,605=22%	142/1,362=10%	138/1,225=11%

Return on working capital (P/WC)	EBITA in relation to average working capital.
		30-Sep-20 31-Dec-19
EBITA		588 305	276
Average working capital (WC)		728 598	547
P/WC	588/728=81%	305/598=51%	276/547=51%

EBITA 30-Sep-20 31-Dec-19 30-Sep-19 Operating profit (12 months rolling) 467 196 177 Amortization of intangible assets 121 109 99 EBITA 588 305 276 Operating profit before amortization of intangible assets.

EBITA marginal
	30-Sep-20	31-Dec-19	30-Sep-19
EBITA	588	305	276
Net sales	4,530	3,479	3,176
EBITA margin	588/4,530=13.0%	305/3,479= 8.8%	276/3,176=8.7%

Definitions

EBITA	Operating profit before amortization of intangible assets.
EBITDA	Operating profit before depreciation and amortization
Equity per share	Shareholders' proportion of equity divided by the number of shares outstanding at the end of the reporting period
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 last year's EBITA divided by last year's EBITA.
Financial net liabilities	Interest-bearing liabilities and interest-bearing provisions, less cash and cash equivalents.
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 14 and they are commented on pages 1-5.

The comparison figures for income and expense items relate to values for the period January–September 2019 and for balance sheet items as at 31 December 2019 if nothing else is stated.

Parent company summary

Income statement	3 months ending		9 months ending		12 months ending
SEKm					30-Sep-20 30-Sep-19 30-Sep-20 30-Sep-19 30-Sep-20 31-Dec-19
Net sales	11	10	32	28	45	41
Administrative expenses	-13	-12	-41	-37	-53	-49
Operating profit/loss	-2	-2	-9	-9	-8	-8
Interest income/expenses and similar items	2	2	8	6	4	2
Profit/loss after financial items	0	0	-1	-3	-4	-6
Appropriations	-	-	-	-	48	48
Profit/loss before taxes	0	0	-1	-3	44	42
Income tax expense	0	0	0	0	-6	-6
Profit/loss for the period	0	0	-1	-3	38	36

Balance sheet, SEKm	30-Sep-20	31-Dec-19	30-Sep-19
Intangible non-current assets	0	0	0
Tangible non-current assets	0	0	0
Non-current financial assets	2,125	2,084	2,095
Total non-current assets	2,125	2,084	2,095
Current receivables	191	110	38
Total current assets	191	110	38
Total assets	2,316	2,194	2,133
Equity	1,159	1,152	1,113
Untaxed reserves	56	56	47
Interest-bearing long-term liabilities	75	48	48
Non-interest-bearing long-term liabilities	0	1	3
Total long-term liabilities	75	49	51
Interest-bearing short-term liabilities	1,008	899	907
Non-interest-bearing short-term liabilities	18	38	15
Total short-term liabilities	1,026	937	922
Total equity and liabilities	2,316	2,194	2,133

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 7:45 a.m. CET on 21 October, 2020.

AddLife AB (publ), Box 3145, Brunkebergstorg 5, SE-103 62 Stockholm. info@add.life, www.add.life, org.nr. 556995-8126