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Addtech AB Interim / Quarterly Report 2021
7327_10-k_2021-05-18_2e4022e4-2bbe-429b-92ff-7f2da7c5fe11.pdf
Interim / Quarterly Report
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ADDTECH
YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
FOURTH QUARTER (1 JANUARY - 31 MARCH 2021)
- Net sales amounted to SEK 2,927 million (3,038).
- Operating profit before amortisation of intangible non-current assets (EBITA) amounted to SEK 335 million (407) corresponding to an EBITA margin of 11.4 percent (13.4).
- Operating profit amounted to SEK 266 million (352) corresponding to an operating margin of 9.1 percent (11.6).
- Profit after tax amounted to SEK 190 million (265) and earnings per share before/after dilution amounted to SEK 0.65 (0.95).
FULL YEAR (1 APRIL 2020 - 31 MARCH 2021)
- Net sales amounted to SEK 11,336 million (11,735).
- Operating profit before amortisation of intangible non-current assets (EBITA) amounted to SEK 1,251 million (1,364) corresponding to an EBITA margin of 11.0 percent (11.6).
- Operating profit amounted to SEK 989 million (1,161) corresponding to an operating margin of 8.7 percent (9.9).
- Profit after tax amounted to SEK 729 million (873) and earnings per share before/after dilution amounted to SEK 2.60 (3.20).
- Return on working capital (P/WC) amounted to 52 percent (56).
- Return on equity amounted to 23 percent (32) and the equity ratio amounted to 35 percent (36).
- Cash flow from operating activities amounted to SEK 1,503 million (1,117). Cash flow per share from operating activities amounted to SEK 5.60 (4.15).
- During the year, we have completed 14 acquisitions and closed another four after the end of the year. In total, this equals approximately SEK 1,450 million in annual sales.
- The Board of Directors proposes a dividend of SEK 1.20 (1.00) per share.
| Group Summary | 3 months | Rolling 12 months | ||||
|---|---|---|---|---|---|---|
| SEKm | 31 Mar 2021 | 31 Mar 2020 | Δ | 31 Mar 2021 | 31 Mar 2020 | Δ |
| Net sales | 2,927 | 3,038 | -4% | 11,336 | 11,735 | -3% |
| EBITA | 335 | 407 | -18% | 1,251 | 1,364 | -8% |
| EBITA-margin % | 11.4 | 13.4 | 11.0 | 11.6 | ||
| Profit after financial items | 251 | 333 | -24% | 937 | 1,105 | -15% |
| Profit for the period | 190 | 265 | -28% | 729 | 873 | -17% |
| Earnings per share before dilution, SEK | 0.65 | 0.95 | -32% | 2.60 | 3.20 | -19% |
| Earnings per share after dilution, SEK | 0.65 | 0.95 | -32% | 2.60 | 3.20 | -19% |
| Cash flow from operating activities per share, SEK | - | - | 5.60 | 4.15 | ||
| Return on equity, % | 23 | 32 | 23 | 32 | ||
| Equity ratio, % | 35 | 36 | 35 | 36 |
All calculations of key figures for SEK per share has been restated to take the share split (4:1) completed in September 2020 into account.
Comparisons in parentheses refer to the corresponding period of the previous year, unless stated otherwise.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
CEO'S COMMENTS
In many ways, the 2020/2021 financial year was extraordinary, mainly due to the effects of the Covid-19 pandemic. On the whole, we can assert that Addtech demonstrated a favourable resilience and, given the high pace of business and good cost control, we managed to maintain a respectable operating margin. Despite the uncertainty, we also carried out 14 successful acquisitions in attractive niche areas. All of this combined, again shows the strength and stability of our long-term business model. Following two years strongly influenced by external factors, during which our employees truly demonstrated their capacity to identify new opportunities and adapt quickly to new circumstances, we now look ahead to a new year. Better equipped than ever and with a good order backlog.
FOURTH QUARTER – Continued favourable demand
The recovery in demand continued in the fourth quarter, with a positive trend in most key segments. The most positive impact derived from the favourable market situation in segments including the forest industry and wind power, as well as a continued clear recovery in the engineering industry and special vehicles. As expected, the strengthened market situation was partly offset by a reduced number of project deliveries during the quarter, which mainly affected the Automation business area. In the Energy business area, the inflow of new projects involving infrastructure products for the national and regional grids decreased from very high levels, as had been expected. Our belief remains that this market will continue to be favourable for a long time to come. On the whole, all of the business areas developed according to plan, although sales were slightly down on a very strong fourth quarter last year.
Maintaining a good cost control and our long-term streamlining measures, we managed to achieve an operating margin for the quarter that was almost in line with last year's strong closing, adjusted for revaluations of contingent purchase considerations, which impacted this year's quarter negatively by SEK 15 million and the previous year positively by SEK 30 million.
FULL-YEAR – Good hedge gave stable outcome
Due to the pandemic, the business climate over the year was weak in several of the Group's markets, with demand recovering sequentially. Overall, sales and earnings for the full-year decreased for comparable units. Adjusted for the sharp slowdown in scrubber-related sales, and with the sales and profits contributed by completed acquisitions, both sales and earnings increased, with an improved margin.
In particular, the pandemic has posed challenges for our units operating in the marine, special vehicles and mechanical industry segments. At the same time, other segments with great development potential have performed well, such as transmission, wind power and the forest and sawmill industries. The business situation has generally been stable in electronics, data and telecom as well as medical technology. Towards the end of the financial year, the business situation normalised, and demand increased in most of the Group's important market segments.
Geographically, Sweden and Denmark had a stable development, viewed over the full-year. Finland has been negatively affected by the deteriorating business situation, particularly in the mechanical industry, and Norway by the lack of willingness to invest in oil and gas. Countries outside the Nordic region are hardest hit by pandemic shut-downs and restrictions. However, over the second half of the financial year, the market situation for our companies with operations in these markets improved sequentially.
Throughout the year, the units experiencing a deteriorating business situation worked actively with measures on costs and working capital. These measures are ongoing and, in total, the adjustments have encompassed 250 employees. The measures entail a cost level better adapted to current sales volumes and will offset the costs that are expected to recur as the companies' marketing activities gradually increase as volumes improve.
For the full-year, cash flow was significantly better than for the preceding year, at SEK 1,503 million (1,117), thanks to stable margins and measures for more efficient working capital. We managed to achieve a P/WC of 52 percent despite the fact that the accumulated operating profit for the year decreased. Our liquidity remains good, and we have satisfactory credit head room for continued investment opportunities.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
ACQUISITIONS – Strong acquisition pace
We have maintained a strong acquisition pace which proves the strength of our acquisition strategy. A total of 14 acquisitions were made during the year and four more after the end of the year. In total, these 18 acquisitions add approximately SEK 1,450 million to sales and approximately 420 new employees to the Group.
Acquisitions of successful, market-leading companies in various technical niches represent an important part of our growth strategy. Several of this year's acquisitions also have a clear sustainability profile and thus fit well into our long-term sustainability vision. We continue to see good acquisition opportunities, both in the Nordic region and in selected parts of Europe.
OUTLOOK – Catalyst for sustainable growth
Our decentralised organisational structure and entrepreneurial culture, with decisions made close to the customer, has once again shown its strength and the past financial year is also clear proof of the strength of our business model. The starting position for the current year is good, the order backlog is well filled, with demand remaining favourable in April. However, we are humbled by the situation surrounding the development of the pandemic. There is also some uncertainty about how the ongoing supply chain constraints will affect our companies' delivery capacity in the upcoming quarters.
We are continuing our development towards the new normal, where sustainable technology solutions and digitalisation are increasingly coming into focus. We are very well positioned to take advantage of the growth opportunities in selected segments and niches in structurally driven development areas. By balancing organic growth and acquisitions with good cost control, we will continue to be a catalyst for sustainable growth.
This year, it will be 20 years since Addtech was spun off as an independent listed company. Our average annual earnings growth has been 18 percent, demonstrating our ability to deliver long-term sustainable growth and favourable returns for shareholders. For us as a group, we have formulated a new vision to act as a guiding light for our continued successful growth – Leading technical solutions for a sustainable tomorrow. This vision provides inspiration for the entire group, while of course we continue to safeguard our strongly entrepreneurial culture based on decentralised responsibility.
Finally, I would like to thank all of our committed employees for their invaluable efforts over the year. We look forward to the coming year with great confidence and continued sustainable profitable growth.
Niklas Stenberg
President and CEO
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
GROUP DEVELOPMENT
Sales development
Net sales in the Addtech Group in the fourth quarter amounted to SEK 2,927 million (3,038). The organic effect amounted to -10 percent and acquired growth amounted to 9 percent. Exchange rate changes affected net sales negatively with 3 percent, corresponding to SEK 81 million.
Net sales in the Addtech Group during the financial year amounted to SEK 11,336 million (11,735). The organic effect amounted to -8 percent and acquired growth amounted to 7 percent. Exchange rate changes had a negative effect of 2 percent on net sales, corresponding to SEK 298 million.
Profit development
Operating profit during the quarter amounted to SEK 266 million (352) and the operating margin amounted to 9.1 percent (11.6). Net financial items amounted to SEK -15 million (-19) and profit after financial items amounted to SEK 251 million (333).
Profit after tax during the quarter amounted to SEK 190 million (265) corresponding to earnings per share before dilution of SEK 0.65 (0.95).
EBITA for the financial year amounted to SEK 1,251 million (1,364). Operating profit amounted to SEK 989 million (1,161) and the operating margin amounted to 8.7 percent (9.9). Net financial items were SEK -52 million (-56) and profit after financial items amounted to SEK 937 million (1,105).
Profit after tax for the financial year amounted to SEK 729 million (873) and the effective tax rate amounted to 22 percent (21). Earnings per share before dilution for the financial year amounted to SEK 2.60 (3.20).
Net Sales and EBITA margin, rolling 12 months
Sales per customer segment
Sales per geographic market
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
DEVELOPMENT IN THE BUSINESS AREAS
AUTOMATION
Net sales in Automation in the fourth quarter amounted to SEK 614 million (694) and EBITA amounted to SEK 77 million (99). Net sales during the financial year amounted to SEK 2,384 million (2,425) and EBITA amounted to SEK 245 million (267).
Market
Overall, the Automation business area was affected marginally negatively by Covid-19. Very tough comparisons with last year's final quarter and fewer planned deliveries of projects meant that sales decreased sequentially from the third quarter. Demand was good in the engineering industry, while the business situation was stable in other important segments such as medical technology, the defence industry, and data and telecom. The market situation among the companies operating in the markets outside the Nordic region remained affected by shut-downs and restrictions, although the market situation improved sequentially. Profit was affected positively in the quarter by a revaluation of contingent purchase considerations by approximately SEK 10 million, the margin was also being positively affected as a result of the year's streamlining measures.
Automation - Sales per customer segment
- Building & Installation (4%)
- Data & Telecommunication (12%)
- Electronics (3%)
- Energy (8%)
- Vehicle (4%)
- Medical technology (20%)
- Mechanical industry (21%)
- Forest & Process (12%)
- Transportation (6%)
- Other (10%)
Automation - Sales per geographic market
- Sweden (23%)
- Denmark (21%)
- Finland (17%)
- Norway (11%)
- Other Europe (23%)
- Other countries (5%)
COMPONENTS
Net sales in Components in the fourth quarter amounted to SEK 534 million (578) and EBITA amounted to SEK 59 million (65). Net sales during the financial year amounted to SEK 2,015 million (2,082) and EBITA amounted to SEK 196 million (218).
Market
The Components business area was marginally negatively affected by Covid-19 and ended the financial year stably despite tough comparisons with the fourth quarter of the preceding year. The market situation in Denmark was favourable in the quarter and stable in Sweden and Finland, while the business situation in Norway was weak due to the low willingness to invest in oil and gas. Demand remained good in the wind power market, as well as in electronics, and the recovery continued in the special vehicle and engineering industries. This year's cost savings have had an effect on the margin trend, which was back to normal levels for the quarter.
Components - Sales per customer segment
- Building & Installation (6%)
- Data & Telecommunication (3%)
- Electronics (15%)
- Energy (15%)
- Vehicle (16%)
- Medical technology (7%)
- Mechanical industry (17%)
- Forest & Process (3%)
- Transportation (4%)
- Other (14%)
Components - Sales per geographic market
- Sweden (30%)
- Denmark (20%)
- Finland (16%)
- Norway (12%)
- Other Europe (15%)
- Other countries (7%)
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
ENERGY
Net sales in Energy in the fourth quarter amounted to SEK 593 million (604) and EBITA increased by 4 percent to SEK 82 million (78). Net sales during the financial year increased by 6 percent to SEK 2,566 million (2,412) and EBITA increased by 16 percent to SEK 329 million (282).
Market
The Energy business area was affected marginally negatively by Covid-19. The market situation in infrastructure products for the rebuilding and expansion of national and regional grids remains favourable, although the inflow of new projects decreased from very high levels, as expected. Long permit periods and lack of consulting capacity affect how quickly the build-out can occur. In wind power, demand remained at high levels and the market situation continued to recover for the units active in sales of niche products for power distribution, as well as in building and installation. A minor revaluation of contingent purchase considerations and currency differences have had a positive effect on the margin for the quarter.
Energy - Sales per customer segment
Energy - Sales per geographic market
INDUSTRIAL PROCESS
Net sales in Industrial Process in the fourth quarter amounted to SEK 729 million (732) and EBITA amounted to SEK 52 million (113). Net sales during the financial year amounted to SEK 2,785 million (3,204) and EBITA amounted to SEK 288 million (445).
Market
The Industrial Process business area was affected strongly negatively by effects of Covid-19, primarily due to the continued low demand for scrubber installation solutions, where sales decreased by about 80 percent compared with the same period in the preceding year. The market situation for the companies in special vehicles and the engineering industry continued to develop positively. The business situation in the process industry and demand for projects in the forest industry also remained favourable. Profits were negatively affected by a revaluation of contingent purchase considerations of approximately SEK 31 million for the quarter.
Industrial Process - Sales per customer segment
Industrial Process - Sales per geographic market
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
POWER SOLUTIONS
Net sales in Power Solutions increased in the fourth quarter by 6 percent to SEK 462 million (434) and EBITA amounted to SEK 63 million (68). Net sales during the financial year amounted to SEK 1,606 million (1,630) and EBITA amounted to SEK 209 million (231).
Market
The Power Solutions business area was affected moderately negatively by the effects of Covid-19. Sales of products in special vehicles also developed positively in the fourth quarter, with demand continuing to increase. Demand was favourable for customized battery solutions, as well as in data and telecom, medical technology and defence. The business situation in wind power was stable during the quarter, while sales decreased for the companies operating in power supply. Margins have recovered to normal levels thanks to cost savings and the recovery in special vehicles.
Power Solutions - Sales per customer segment
Power Solutions - Sales per geographic market
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
OTHER FINANCIAL INFORMATION
Profitability, financial position and cash flow
The return on equity at the end of the financial year was 23 percent (32), and return on capital employed was 15 percent (21). Return on working capital P/WC (EBITA in relation to working capital) amounted to 52 percent (56).
At the end of the financial year the equity ratio amounted to 35 percent (36). Equity per share, excluding non-controlling interest, totalled SEK 11.95 (11.25). The Group's net debt at the end of the financial year amounted to SEK 2,798 million (2,253), excluding pension liabilities of SEK 336 million (332). The net debt/equity ratio, calculated on the basis of net debt excluding provisions for pensions amounted to 0.8 (0.7).
Cash and cash equivalents consisting of cash and bank equivalents and approved but non-utilised credit facilities amounted to SEK 2,119 million (2,407) at 31 March 2021.
Cash flow from operating activities amounted to SEK 1,503 million (1,117) during the financial year. Company acquisitions and disposals including settlement of contingent consideration regarding acquisitions implemented in previous years amounted to SEK 1,219 million (430). Investments in noncurrent assets totalled SEK 90 million (109) and disposal of non-current assets amounted to SEK 11 million (6). Repurchase of treasury shares amounted to SEK 0 million (42) and repurchase of call options amounted to SEK 23 million (23). Exercised and issued call options totalled SEK 48 million (39). Dividends paid to the shareholders of the Parent Company totalled SEK 269 million (336), corresponding to SEK 1.00 (1.25) per share. The dividend was paid out in the second quarter.
Employees
At the end of the financial year, the number of employees was 3,133, compared to 2,981 at the beginning of the financial year. During the financial year, completed acquisitions resulted in an increase of the number of employees by 321. The average number of employees in the latest 12-month period was 3,068.
Ownership structure
At the end of the financial year the share capital amounted to SEK 51.1 million.
| Class of shares | Number of shares | Number of votes | Percentage of capital | Percentage of votes |
|---|---|---|---|---|
| Class A shares, 10 votes per share | 12,885,744 | 128,857,440 | 4.7% | 33.1% |
| Class B shares, 1 vote per share | 259,908,240 | 259,908,240 | 95.3% | 66.9% |
| Total number of shares before repurchases | 272,793,984 | 388,765,680 | 100.0% | 100.0% |
| Repurchased class B shares | -3,519,272 | 1.3% | 0.9% | |
| Total number of shares after repurchases | 269,274,712 |
Addtech has four outstanding call option programmes for a total of 3,590,000 shares. Call options issued on repurchased shares entail a dilution effect of about 0.3 percent during the latest 12-month period. Addtech's own shareholding is estimated to meet the needs of the outstanding call option programmes.
| Outstanding programme | Number of options | Corresponding number of shares | Proportion of total shares | Exercise price per option | Exercise price per share | Expiration period |
|---|---|---|---|---|---|---|
| 2020/2024 | 250,000 | 1,000,000 | 0.4% | 538.10 | 134.53 | 4 Sep 2023 - 5 Jun 2024 |
| 2019/2023 | 300,000 | 1,200,000 | 0.4% | 321.80 | 80.45 | 5 Sep 2022 - 2 Jun 2023 |
| 2018/2022 | 300,000 | 1,200,000 | 0.4% | 232.90 | 58.23 | 6 Sep 2021 - 3 Jun 2022 |
| 2017/2021 | 47,500 | 190,000 | 0.1% | 178.50 | 44.62 | 14 Sep 2020 - 4 Jun 2021 |
| Total | 897,500 | 3,590,000 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
Acquisitions and disposals
During the period, 1 April to 31 December 2020 the following acquisitions were completed: Elkome Group Oy, Kaptas Oy and Elsystem i Perstorp AB was acquired to become part of the Automation business area. Fluidcontrol Oy and Satco Komponent AB was acquired to become part of the Components business area. Peter Andersson AB and Skyltar & Märken Gruppen AB was acquired to become part of the Energy business area. Valutec Group AB and Martin Bruusgaard AS was acquired to become part of the Industrial Process business area. OF-Beteiligungs AG was acquired to become part of the Power Solutions business area.
On 4 January, Synective Labs AB, Sweden, was acquired to become part of the Automation business area. Synective Labs are specialized in high performance systems, creating optimized hardware and software designs within FPGA and ASIC designs. The company has 27 employees and sales of around SEK 30 million.
On 5 January, Powernor AS, Norway, was acquired to become part of the Power Solutions business area. Powernor is based in Norway, where they specify, design and deliver complete UPS systems with battery backup in demanding applications for hospitals, infrastructure and industry. Powernor has a turnover of approximately NOK 35 million and have 6 employees.
On 21 January, Impact Air Systems Ltd. and Impact Technical Services Ltd., Great Britain, was acquired to become part of the Industrial Process business area. Impact provides waste and trim extraction and separation systems to various industries and recycling facilities around the world. The company's bespoke solutions contribute to a more sustainable management of waste and the circular economy. The company has 33 employees and sales of around GBP 8 million.
On 2 March, Fairfield Trading Company Ltd., Great Britain, was acquired to become part of the Power Solutions business area. Fairfield Trading Company Ltd. is a distributor specialising in the supply of batteries for a wide range of markets. The company has sales of about GBP 3 million and 8 employees.
The purchase price allocation calculations for the acquisitions completed during the period 1 April 2019 - 31 March 2020 have now been finalised. No significant adjustments have been made to the calculations. Acquisitions completed as of the 2019/2020 financial year are distributed among the Group's business areas as follows:
| Acquisitions (disposals) | Closing | Net sales, SEKm* | Number of employees* | Business Area |
|---|---|---|---|---|
| Omni Ray AG, Switzerland | April, 2019 | 330 | 65 | Automation |
| Thume Teknik AB, Sweden | April, 2019 | 100 | 19 | Industrial Process |
| AB N.O. Rönne, Sweden | April, 2019 | 8 | 4 | Industrial Process |
| Best Seating Systems Walter Tausch GmbH, Austria | May, 2019 | 23 | 5 | Power Solutions |
| Thiim A/S, Denmark | June, 2019 | 70 | 15 | Automation |
| Profelec Oy, Finland | July, 2019 | 6 | 2 | Energy |
| BKC Products Ltd., Great Britain | August, 2019 | 12 | 5 | Industrial Process |
| Promector Oy, Finland | August, 2019 | 24 | 20 | Automation |
| Wireco-NB Oy, Finland | February, 2020 | 23 | 6 | Energy |
| Caligo Industria Oy, Finland | February, 2020 | 70 | 9 | Industrial Process |
| DMC Digital Motor Control GmbH, Germany | March, 2020 | 30 | 10 | Power Solutions |
| Q-tronic B.V., Netherlands | March, 2020 | 45 | 10 | Power Solutions |
| Elkome Group Oy, Finland | April, 2020 | 85 | 38 | Automation |
| Peter Andersson AB, Sweden | April, 2020 | 30 | 9 | Energy |
| Valutec Group AB, Sweden | April, 2020 | 350 | 45 | Industrial Process |
| Fluidcontrol Oy, Finland | September, 2020 | 41 | 20 | Components |
| Kaptas Oy, Finland | September, 2020 | 41 | 27 | Automation |
| Elsystem i Perstorp AB, Sweden | September, 2020 | 40 | 18 | Automation |
| Martin Bruusgaard AS, Norway | September, 2020 | 108 | 30 | Industrial Process |
| Satco Komponent AB, Sweden | October, 2020 | 18 | 2 | Components |
| Skyltar & Märken Gruppen AB, Sweden | October, 2020 | 60 | 23 | Energy |
| OF-Beteiligungs AG, Switzerland | December, 2020 | 170 | 35 | Power Solutions |
| Powernor AS, Norway | January, 2021 | 35 | 6 | Power Solutions |
| Synective Labs AB, Sweden | January, 2021 | 30 | 27 | Automation |
| Impact Air Systems Ltd. och Impact Technical Services Ltd., Great Britain | January, 2021 | 95 | 33 | Industrial Process |
| Fairfield Trading Company Ltd., Great Britain | March, 2021 | 37 | 8 | Power Solutions |
| Hydro-Material Oy, Finland | April, 2021 | 52 | 5 | Components |
| ESi Controls Ltd., Great Britain | April, 2021 | 93 | 15 | Power Solutions |
| IETV Elektroteknik AB, Sweden | May, 2021 | 80 | 38 | Energy |
| AVT Industriteknik AB, Sweden | May, 2021 | 70 | 42 | Automation |
- Refers to assessed condition at the time of acquisition and disposal, respectively, on a full-year basis.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
If all acquisitions which have taken effect during the financial year had been completed on 1 April 2020, their impact would have been an estimated SEK 1,080 million on Group net sales, about SEK 100 million on operating profit and about SEK 80 million on profit after tax for the period.
Addtech normally employs an acquisition structure comprising basic purchase consideration and contingent consideration. The outcome of contingent purchase considerations is determined by the future earnings reached by the companies and is subject to a fixed maximum level. Of considerations not yet paid for acquisitions during the financial year, the discounted value amounts to SEK 205 million. The contingent purchase considerations fall due for payment within three years and the outcome is subject to a maximum of SEK 263 million.
Transaction costs for acquisitions that resulted in an ownership transfer during the financial year, amounted to SEK 12 million (7) and are reported under Selling expenses.
Revaluation of contingent consideration had a negative net effect of SEK -9 million (52) during the financial year. The impact on profits are reported under Other operating income and Other operating expenses, respectively.
According to the finalised acquisitions analyses, the assets and liabilities included in the acquisitions were as follows, during the year:
| SEKm | Carrying amount at acquisition date | Adjustment to fair value | Fair value |
|---|---|---|---|
| Intangible non-current assets | 26 | 778 | 804 |
| Other non-current assets | 35 | - | 35 |
| Inventories | 138 | - | 138 |
| Other current assets | 444 | - | 444 |
| Deferred tax liability/tax asset | -5 | -156 | -161 |
| Other liabilities | -236 | -31 | -267 |
| Acquired net assets | 402 | 591 | 993 |
| Goodwill 1) | 773 | ||
| Non-controlling interests 2) | -163 | ||
| Consideration 3) | 1,603 | ||
| Less: cash and cash equivalents in acquired businesses | -285 | ||
| Less: consideration not yet paid | -199 | ||
| Effect on the Group's cash and cash equivalents | 1,119 |
1) Goodwill is justified by expected future sales trend and profitability as well as the personnel included in the acquired companies.
2) Non-controlling interests has been measured at fair value, which entails that goodwill is also reported for non-controlling interests.
3) The consideration is stated excluding acquisition expenses.
With the acquisition of Valutec Group AB comes a commitment to acquire the remaining 14 percent of the company and this commitment is valued to SEK 111 million. With the acquisition of Martin Bruusgaard AS comes a commitment to acquire the remaining 20 percent of the company and this commitment is valued to SEK 27 million. These commitments are reported as a non-current interest-bearing liability.
Parent Company
Parent Company net sales amounted to SEK 58 million (71) and profit after financial items was SEK 378 million (-41). Net investments in non-current assets were SEK 0 million (0). The Parent Company's financial net debt was SEK 286 million (341) at the end of the financial year.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
OTHER DISCLOSURES
Accounting policies
The interim report has been prepared in accordance with IFRS as adopted by the EU, with IAS 34 Interim Financial Reporting being applied. Apart from in the financial statements and their accompanying notes, disclosures in accordance with IAS 34.16A also appear in other parts of the interim report. The interim report for the Parent Company has been prepared in accordance with the Annual Accounts Act and the Securities Market Act, which is in accordance with the provisions of RFR 2 Accounting for Legal Entities.
In the interim report, the same accounting principles and bases of calculation have been applied as in the most recent annual report, with the exception of the amended accounting principles described below.
New and amended standards for the 2020/2021 financial year
Other new or amended IFRS are not expected to have any significant effects on the Addtech Group.
Governmental support measures
Those governmental support measures that have been received or will be received as an effect of the Covid-19 pandemic will be recognized in the income statement when it is reasonably certain that the conditions for receiving the support have been met or will be met.
Alternative performance measures
The Company 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, they 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. For definitions and reconciliation tables of the performance measures that Addtech uses, please see page 22-25.
Risks and factors of uncertainty
Addtech's profit and financial position, as well as its strategic position, are affected by a number of internal factors under Addtech's control and by a number of external factors over which Addtech has limited influence. The most important risk factors are the state of the economy, combined with structural change and the competitive situation.
The Covid-19 pandemic that erupted during the beginning of 2020 affects the entire world market and also affect Addtech. Addtech continues to follow the recommendations of the relevant authorities and takes relevant health precautions to protect staff and reduce the spread of infection in society. There are challenges in the supply chain and uncertainties exist about our customers' ability to keep their businesses running at full capacity. All companies in the Group have action plans and cost-cutting programs ready to be executed to protect earnings, liquidity and cash flow if the situation should change.
Addtech has a few operating subsidiaries within the UK as well as a few other subsidiaries doing business with the UK. Addtech Group's total exposure to possible negative effects from Brexit is not considered material.
Beside this, risks and uncertainty factors are the same as in previous periods, please see section Risks and uncertainties (page 41-43) in the annual report for 2019/2020 for further details.
The Parent Company is indirectly affected by the above risks and uncertainty factors due to its role in the organisation.
Effects of the Covid-19 pandemic
After the outbreak of the Covid-19 pandemic the Swedish government has decided on a number of government support measures. The same has also been decided in other countries where the Addtech group operates. Addtech has analyzed the conditions for these support measures and has applied where the criterias are judged to be met.
At the end of the fourth quarter, approximately 250 of the Group's total approximately 3,100 employees have been notified of redundancy and a further 120 employees are affected by short-term lay-offs. For the group in total EBITA was marginally positively affected during the fourth quarter and during the period there has been a positive effect of approximately the equivalent of 0.4% of sales due to governmental support measures. These grants are recognised under other operating income, or as a reduction in personnel expenses, depending on local practices in different countries.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
Sales are estimated to have been moderately negatively affected during the fourth quarter and in the period as a whole, with a sequential improvement after the first six-month period. It is primarily sales in the special vehicles, the marine and the mechanical industry segments that have been affected. No significant write-downs have been done due to the current pandemic.
Transactions with related parties
No transactions between Addtech and related parties that have significantly affected the Group's position and earnings have taken place during the period.
Seasonal effects
Addtech's sales of high-tech products and solutions in the manufacturing industry and infrastructure are not subject to major seasonal variations. The number of production days and customers' demand and willingness to invest can vary over the quarters.
Annual Report 2020/2021
The annual report for 2020/2021 will be published on Addtech's website www.addtech.com in July 2021. A printed version will be distributed to the shareholders who request this.
Annual General Meeting 2021
The Annual General Meeting (AGM) of Addtech AB will take place at 2:00 p.m on Thursday 26 August 2021. A notice of the AGM will be published in July 2021 and will also be available on www.addtech.com.
The Board of Directors proposes dividend of SEK 1.20 (1.00) per share, which corresponds to a dividend payment of about SEK 323 million (269), which is in line with Addtech's dividend policy with the objective of a dividend that exceeds 30 percent of average Group profit after tax over a business cycle.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
12
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
Events after the end of the financial year
On 1 April, ESi Controls Ltd., Great Britain, was acquired to become part of the Power Solutions business area. ESi (Energy Saving Innovative) Controls is a UK based company designing and delivering energy efficient electronic controls for heating and smart building applications. ESi Controls Ltd. has a turnover of approximately GBP 8 million and have 15 employees.
On 1 April, Hydro-Material Oy, Finland, was acquired to become part of the Component business area. Hydro-Material delivers hydraulic solutions and cooling systems to primarily the market segments special vehicles and the manufacturing industry. Hydro-Material Oy has sales of approximately EUR 5 million and 5 employees.
On 3 May IETV Elektroteknik AB, Sweden, was acquired to become part of the Energy business area. IETV Elektroteknik AB is a knowledge company that offers qualified services in power supply to railways, hydropower and industry. IETV Elektroteknik AB has 38 employees and has annual sales of approximately SEK 80 million.
On 11 May, AVT Industriteknik AB, Sweden, was acquired to become part of the Automation business area. AVT designs and manufactures industrial automation equipment primarily for the manufacturing, pharma and automotive industry. The offering includes electrical and mechanical design, programming of PLC and industrial robots, vision technology, installation and service. The company has 42 employees and sales of around SEK 70 million.
Preliminary purchase price allocations have not yet been completed.
Stockholm May 18, 2021
Niklas Stenberg
CEO and President
FURTHER INFORMATION
Publication
This information is information that Addtech 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 persons set out below, at 8.15 a.m CET on 18 May 2021.
Future information
2021-07-16 Interim report 1 April - 30 June 2021
2021-08-26 Annual General Meeting 2021 will be held at 2.00 p.m
2021-10-28 Interim report 1 April - 30 September 2021
2022-02-08 Interim report 1 April - 31 December 2021
The Group's annual report for 2020/2021 will be published on Addtech's website in July 2021.
For further information, please contact:
Niklas Stenberg, President and CEO, +46 8 470 49 00
Malin Enarson, CFO, +46 705 979 473
REVIEW REPORT
INTRODUCTION
We have reviewed the summary interim financial information (year-end report) of Addtech AB (publ.), corp.ID 556302-9726, as of 31 March 2021 and the twelve-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.
FOCUS AND SCOPE OF THE REVIEW
We conducted our review in accordance with the International Standard on Review Engagements (ISRE) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity'. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different focus and is substantially smaller in scope than an audit conducted in accordance with ISA and other generally accepted auditing standards. The procedures performed in a review do not enable us to obtain a level of assurance that would make us aware of all significant matters that could have been identified in an audit. Therefore, the conclusion expressed on the basis of a review does not give the same level of assurance as a conclusion expressed on the basis of an audit.
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, 18 May 2021
KPMG AB
KPMG AB
Joakim Thilstedt
Johanna Hagström Jerkeryd
Authorised Public Accountant
Authorised Public Accountant
Auditor in Charge
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
BUSINESS AREAS
| Net sales by business area Quarterly data, SEKm | 2020/2021 | 2019/2020 | ||||||
|---|---|---|---|---|---|---|---|---|
| Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |
| Automation | 614 | 625 | 562 | 583 | 694 | 588 | 552 | 591 |
| Components | 534 | 498 | 487 | 496 | 578 | 489 | 511 | 504 |
| Energy | 593 | 657 | 633 | 683 | 604 | 596 | 593 | 619 |
| Industrial Process | 729 | 707 | 680 | 669 | 732 | 800 | 865 | 807 |
| Power Solutions | 462 | 398 | 365 | 381 | 434 | 377 | 402 | 417 |
| Group items | -5 | -4 | -4 | -7 | -4 | -4 | -6 | -4 |
| Addtech Group | 2,927 | 2,881 | 2,723 | 2,805 | 3,038 | 2,846 | 2,917 | 2,934 |
| EBITA by business area Quarterly data, SEKm | 2020/2021 | 2019/2020 | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |
| Automation | 77 | 58 | 60 | 50 | 99 | 51 | 57 | 60 |
| Components | 59 | 37 | 50 | 50 | 65 | 41 | 58 | 54 |
| Energy | 82 | 87 | 79 | 81 | 78 | 62 | 75 | 67 |
| Industrial Process | 52 | 86 | 77 | 73 | 113 | 95 | 134 | 103 |
| Power Solutions | 63 | 50 | 46 | 50 | 68 | 36 | 62 | 65 |
| Group items | 2 | -14 | -6 | 2 | -16 | -49 | -6 | -8 |
| EBITA | 335 | 304 | 306 | 306 | 407 | 236 | 380 | 341 |
| Depr. of intangible non-current assets | -69 | -66 | -64 | -63 | -55 | -48 | -51 | -49 |
| - of which acquisitions | -64 | -62 | -61 | -60 | -49 | -47 | -49 | -47 |
| Operating profit | 266 | 238 | 242 | 243 | 352 | 188 | 329 | 292 |
| Net sales | 3 months | Rolling 12 months | ||||||
| --- | --- | --- | --- | --- | ||||
| SEKm | 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | ||||
| Automation | 614 | 694 | 2,384 | 2,425 | ||||
| Components | 534 | 578 | 2,015 | 2,082 | ||||
| Energy | 593 | 604 | 2,566 | 2,412 | ||||
| Industrial Process | 729 | 732 | 2,785 | 3,204 | ||||
| Power Solutions | 462 | 434 | 1,606 | 1,630 | ||||
| Group items | -5 | -4 | -20 | -18 | ||||
| Addtech Group | 2,927 | 3,038 | 11,336 | 11,735 | ||||
| EBITA and EBITA-margin | 3 months | Rolling 12 months | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | |||||
| SEKm | % | SEKm | % | SEKm | % | SEKm | % | |
| Automation | 77 | 12.5 | 99 | 14.3 | 245 | 10.3 | 267 | 11.0 |
| Components | 59 | 11.1 | 65 | 11.2 | 196 | 9.7 | 218 | 10.5 |
| Energy | 82 | 13.8 | 78 | 13.0 | 329 | 12.8 | 282 | 11.7 |
| Industrial Process | 52 | 7.1 | 113 | 15.4 | 288 | 10.3 | 445 | 13.9 |
| Power Solutions | 63 | 13.5 | 68 | 15.7 | 209 | 13.0 | 231 | 14.2 |
| Group items | 2 | -16 | -16 | -79 | ||||
| EBITA | 335 | 11.4 | 407 | 13.4 | 1,251 | 11.0 | 1,364 | 11.6 |
| Depr. of intangible non - current assets | -69 | -55 | -262 | -203 | ||||
| - of which acquisitions | -64 | -49 | -247 | -192 | ||||
| Operating profit | 266 | 9.1 | 352 | 11.6 | 989 | 8.7 | 1,161 | 9.9 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
DISAGGREGATION OF REVENUE
| Net sales by the subsidiaries geographical location | 3 months 31 Mar 2021 | ||||||
|---|---|---|---|---|---|---|---|
| SEKm | Automation | Components | Energy | Industrial Process | Power Solutions | Group items | Addtech Group |
| Sweden | 192 | 228 | 192 | 273 | 243 | -2 | 1,126 |
| Denmark | 129 | 131 | 132 | 102 | 25 | -3 | 516 |
| Finland | 101 | 112 | 51 | 115 | 39 | 0 | 418 |
| Norway | 59 | 53 | 141 | 126 | 27 | 0 | 406 |
| Other Europe | 127 | 5 | 68 | 92 | 108 | 0 | 400 |
| Other countries | 6 | 5 | 9 | 21 | 20 | 0 | 61 |
| Total | 614 | 534 | 593 | 729 | 462 | -5 | 2,927 |
| Net sales by the subsidiaries geographical location | 12 months | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- |
| 31 Mar 2021 | |||||||
| SEKm | Automation | Components | Energy | Industrial Process | Power Solutions | Group items | Addtech Group |
| Sweden | 676 | 813 | 917 | 971 | 934 | -9 | 4,302 |
| Denmark | 574 | 524 | 556 | 422 | 92 | -9 | 2,159 |
| Finland | 410 | 440 | 211 | 531 | 141 | -1 | 1,732 |
| Norway | 229 | 199 | 579 | 493 | 92 | -1 | 1,591 |
| Other Europe | 469 | 18 | 261 | 254 | 272 | 0 | 1,274 |
| Other countries | 26 | 21 | 42 | 114 | 75 | 0 | 278 |
| Total | 2,384 | 2,015 | 2,566 | 2,785 | 1,606 | -20 | 11,336 |
| Net sales by the subsidiaries geographical location | 3 months | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- |
| 31 Mar 2020 | |||||||
| SEKm | Automation | Components | Energy | Industrial Process | Power Solutions | Group items | Addtech Group |
| Sweden | 200 | 234 | 174 | 210 | 271 | -2 | 1,087 |
| Denmark | 153 | 144 | 150 | 119 | 27 | -2 | 591 |
| Finland | 101 | 129 | 52 | 137 | 31 | 0 | 450 |
| Norway | 79 | 63 | 153 | 146 | 28 | 0 | 469 |
| Other Europe | 155 | 5 | 69 | 78 | 58 | - | 365 |
| Other countries | 6 | 3 | 6 | 42 | 19 | 0 | 76 |
| Total | 694 | 578 | 604 | 732 | 434 | -4 | 3,038 |
| Net sales by the subsidiaries geographical location | 12 months | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- |
| 31 Mar 2020 | |||||||
| SEKm | Automation | Components | Energy | Industrial Process | Power Solutions | Group items | Addtech Group |
| Sweden | 714 | 832 | 774 | 800 | 1,007 | -6 | 4,121 |
| Denmark | 557 | 546 | 568 | 540 | 97 | -10 | 2,298 |
| Finland | 347 | 461 | 187 | 629 | 117 | -1 | 1,740 |
| Norway | 245 | 227 | 593 | 686 | 107 | -1 | 1,857 |
| Other Europe | 545 | 10 | 277 | 268 | 209 | - | 1,309 |
| Other countries | 17 | 6 | 13 | 281 | 93 | 0 | 410 |
| Total | 2,425 | 2,082 | 2,412 | 3,204 | 1,630 | -18 | 11,735 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
CONSOLIDATED INCOME STATEMENT, CONDENSED
| SEKm | 3 months | Rolling 12 months | ||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | |
| Net sales | 2,927 | 3,038 | 11,336 | 11,735 |
| Cost of sales | -2,016 | -2,082 | -7,863 | -8,088 |
| Gross profit | 911 | 956 | 3,473 | 3,647 |
| Selling expenses | -497 | -483 | -1,843 | -1,869 |
| Administrative expenses | -162 | -172 | -637 | -707 |
| Other operating income and expenses | 14 | 51 | -4 | 90 |
| Operating profit | 266 | 352 | 989 | 1,161 |
| - as % of net sales | 9.1 | 11.6 | 8.7 | 9.9 |
| Financial income and expenses | -15 | -19 | -52 | -56 |
| Profit after financial items | 251 | 333 | 937 | 1,105 |
| - as % of net sales | 8.6 | 11.0 | 8.3 | 9.4 |
| Income tax expense | -61 | -68 | -208 | -232 |
| Profit for the period | 190 | 265 | 729 | 873 |
| Profit for the period attributable to: | ||||
| Equity holders of the Parent Company | 183 | 262 | 706 | 862 |
| Non-controlling interests | 7 | 3 | 23 | 11 |
| Earnings per share before dilution, SEK | 0.65 | 0.95 | 2.60 | 3.20 |
| Earnings per share after dilution, SEK | 0.65 | 0.95 | 2.60 | 3.20 |
| Average number of shares after repurchases, '000s | 269,234 | 268,441 | 269,051 | 268,493 |
| Number of shares after repurchases at end of the period, '000s | 269,275 | 268,594 | 269,275 | 268,594 |
The number of shares has been restated to take the share split (4:1) completed in September 2020 into account, and has been used in all calculations of key figures for SEK per share.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME, CONDENSED
| SEKm | 3 months | Rolling 12 months | ||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | |
| Profit for the period | 190 | 265 | 729 | 873 |
| Items that may be reclassified to profit or loss | ||||
| Cash flow hedges | 3 | 2 | -3 | 1 |
| Foreign currency translation differences for the period | 147 | 54 | -142 | 59 |
| Items that will not be reclassified to profit or loss | ||||
| Actuarial effects of the net pension obligation | 39 | 37 | 15 | -9 |
| Other comprehensive income | 189 | 93 | -130 | 51 |
| Total comprehensive income | 379 | 358 | 599 | 924 |
| Total comprehensive income attributable to: | ||||
| Equity holders of the Parent Company | 369 | 353 | 580 | 910 |
| Non-controlling interests | 10 | 5 | 19 | 14 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
CONSOLIDATED BALANCE SHEET, CONDENSED
| SEKm | 31 Mar 2021 | 31 Mar 2020 |
|---|---|---|
| Goodwill | 2,727 | 1,997 |
| Other intangible non-current assets | 1,769 | 1,243 |
| Property, plant and equipment | 1,008 | 936 |
| Other non-current assets | 60 | 64 |
| Total non-current assets | 5,564 | 4,240 |
| Inventories | 1,661 | 1,642 |
| Current receivables | 2,161 | 2,261 |
| Cash and cash equivalents | 420 | 363 |
| Total current assets | 4,242 | 4,266 |
| Total assets | 9,806 | 8,506 |
| Total equity | 3,450 | 3,076 |
| Interest-bearing provisions | 336 | 332 |
| Non-interest-bearing provisions | 388 | 284 |
| Non-current interest-bearing liabilities | 2,056 | 2,154 |
| Non-current non-interest-bearing liabilities | 9 | 2 |
| Total non-current liabilities | 2,789 | 2,772 |
| Non-interest-bearing provisions | 56 | 46 |
| Current interest-bearing liabilities | 1,162 | 462 |
| Current non-interest-bearing liabilities | 2,349 | 2,150 |
| Total current liabilities | 3,567 | 2,658 |
| Total equity and liabilities | 9,806 | 8,506 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY, CONDENSED
| SEKm | 31 Mar 2021 | 31 Mar 2020 |
|---|---|---|
| Opening balance | 3,076 | 2,520 |
| Exercised, issued and repurchased options | 25 | 16 |
| Repurchase of treasury shares | - | -42 |
| Dividend, ordinary | -269 | -336 |
| Dividend, non-controlling interests | -4 | -10 |
| Change non-controlling interests | 158 | 4 |
| Option debt, acquisition | -135 | - |
| Total comprehensive income | 599 | 924 |
| Closing balance | 3,450 | 3,076 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
CONSOLIDATED CASH FLOW STATEMENT, CONDENSED
| SEKm | 3 months | Rolling 12 months | ||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | |
| Profit after financial items | 251 | 333 | 937 | 1,105 |
| Adjustment for items not included in cash flow | 151 | 76 | 551 | 354 |
| Income tax paid | -81 | -86 | -320 | -273 |
| Changes in working capital | 132 | 127 | 335 | -69 |
| Cash flow from operating activities | 453 | 450 | 1,503 | 1,117 |
| Net investments in non-current assets | -34 | -29 | -79 | -102 |
| Acquisitions and disposals | -165 | -120 | -1,219 | -430 |
| Cash flow from investing activities | -199 | -149 | -1,298 | -532 |
| Dividend paid to shareholders | - | - | -269 | -336 |
| Repurchase of own shares/change of options | 5 | 8 | 25 | -26 |
| Other financing activities | -328 | -248 | 106 | -145 |
| Cash flow from financing activities | -323 | -240 | -138 | -507 |
| Cash flow for the period | -69 | 61 | 67 | 78 |
| Cash and cash equivalents at beginning of period | 454 | 316 | 363 | 295 |
| Exchange differences on cash and cash equivalents | 35 | -14 | -10 | -10 |
| Cash and cash equivalents at end of period | 420 | 363 | 420 | 363 |
FAIR VALUES ON FINANCIAL INSTRUMENTS
| SEKm | 31 Mar 2021 | 31 Mar 2020 | ||||
|---|---|---|---|---|---|---|
| Carrying amount | Level 2 | Level 3 | Carrying amount | Level 2 | Level 3 | |
| Derivatives - fair value, hedge instruments | 2 | 2 | - | 6 | 6 | - |
| Derivatives - fair value through profit | 2 | 2 | - | 5 | 5 | - |
| Total financial assets at fair value per level | 4 | 4 | - | 11 | 11 | - |
| Derivatives - fair value, hedge instruments | 3 | 3 | - | 1 | 1 | - |
| Derivatives - fair value through profit | 4 | 4 | - | 4 | 4 | - |
| Contingent considerations - fair value through profit | 267 | - | 267 | 151 | - | 151 |
| Total financial liabilities at fair value per level | 274 | 7 | 267 | 156 | 5 | 151 |
The fair value and carrying amount are recognised 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 | 31 Mar 2021 | 31 Mar 2020 |
|---|---|---|
| Opening balance | 151 | 198 |
| Acquisitions during the year | 170 | 63 |
| Reversed through profit or loss | 9 | -52 |
| Consideration paid | -64 | -65 |
| Interest expenses | 9 | 3 |
| Exchange differences | -8 | 4 |
| Closing balance | 267 | 151 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
KEY FINANCIAL INDICATORS
| 12 months ending | ||||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 | |
| Net sales, SEKm | 11,336 | 11,735 | 10,148 | 8,022 |
| EBITDA, SEKm | 1,501 | 1,579 | 1,137 | 881 |
| EBITA, SEKm | 1,251 | 1,364 | 1,085 | 838 |
| EBITA-margin, % | 11.0 | 11.6 | 10.7 | 10.5 |
| Operating profit, SEKm | 989 | 1,161 | 910 | 701 |
| Operating margin, % | 8.7 | 9.9 | 9.0 | 8.7 |
| Profit after financial items, SEKm | 937 | 1,105 | 865 | 665 |
| Profit for the period, SEKm | 729 | 873 | 672 | 526 |
| Working capital | 2,416 | 2,415 | 2,029 | 1,591 |
| Return on working capital (P/WC), % | 52 | 56 | 53 | 53 |
| Return on equity, % | 23 | 32 | 29 | 28 |
| Return on capital employed, % | 15 | 21 | 21 | 22 |
| Equity ratio, % | 35 | 36 | 36 | 39 |
| Financial net debt, SEKm | 3,134 | 2,585 | 1,960 | 1,405 |
| Debt / equity ratio, multiple | 0.9 | 0.8 | 0.8 | 0.7 |
| Financial net debt / EBITDA, multiple | 2.1 | 1.6 | 1.7 | 1.6 |
| Net debt excl. pensions, SEKm | 2,798 | 2,253 | 1,700 | 1,176 |
| Net debt, excl pensions / equity ratio, multiple | 0.8 | 0.7 | 0.7 | 0.6 |
| Interest coverage ratio, multiple | 15.8 | 20.5 | 22.1 | 22.7 |
| Average number of employees | 3,068 | 2,913 | 2,590 | 2,283 |
| Number of employees at end of the period | 3,133 | 2,981 | 2,759 | 2,358 |
KEY FINANCIAL INDICATORS PER SHARE
| SEK | 12 months ending | |||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 | |
| Earnings per share before dilution | 2.60 | 3.20 | 2.45 | 1.90 |
| Earnings per share after dilution | 2.60 | 3.20 | 2.45 | 1.90 |
| Cash flow from operating activities per share | 5.60 | 4.15 | 1.95 | 2.00 |
| Shareholders' equity per share | 11.95 | 11.25 | 9.20 | 7.80 |
| Share price at the end of the period | 130.00 | 61.13 | 48.25 | 42.00 |
| Average number of shares after repurchases, '000s | 269,051 | 268,493 | 268,187 | 267,799 |
| Average number of shares adjusted for repurchases and dilution, '000s | 269,969 | 269,200 | 268,755 | 268,710 |
| Number of shares outstanding at end of the period, '000s | 269,275 | 268,594 | 268,228 | 267,969 |
The number of shares has been restated to take the share split (4:1) completed in September 2020 into account, and has been used in all calculations of key figures for SEK per share.
For definitions of key financial indicators, see page 22-24.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
PARENT COMPANY INCOME STATEMENT
| SEKm | 3 months | Rolling 12 months | ||
|---|---|---|---|---|
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2021 | 31 Mar 2020 | |
| Net sales | 11 | 24 | 58 | 71 |
| Administrative expenses | -18 | -17 | -73 | -108 |
| Operating profit/loss | -7 | 7 | -15 | -37 |
| Interest income and expenses and similar items | 396 | -7 | 393 | -4 |
| Profit after financial items | 389 | 0 | 378 | -41 |
| Appropriations | 260 | 310 | 260 | 310 |
| Profit before taxes | 649 | 310 | 638 | 269 |
| Income tax expense | -54 | -68 | -52 | -60 |
| Profit for the period | 595 | 242 | 586 | 209 |
| Total comprehensive income | 595 | 242 | 586 | 209 |
PARENT COMPANY BALANCE SHEET
| SEKm | 31 Mar 2021 | 31 Mar 2020 |
|---|---|---|
| Intangible non-current assets | 1 | 1 |
| Property, plant and equipment | 0 | 0 |
| Non-current financial assets | 4,243 | 2,808 |
| Total non-current assets | 4,244 | 2,809 |
| Current receivables | 819 | 563 |
| Cash and bank balances | - | - |
| Total current assets | 819 | 563 |
| Total assets | 5,063 | 3,372 |
| Restricted equity | 69 | 69 |
| Unrestricted equity | 779 | 437 |
| Total equity | 848 | 506 |
| Untaxed reserves | 211 | 131 |
| Provisions | 14 | 15 |
| Non-current liabilities | 1,618 | 1,727 |
| Current liabilities | 2,372 | 993 |
| Total equity and liabilities | 5,063 | 3,372 |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
DEFINITIONS
Return on equity¹²
Earnings after tax divided by equity. The components are calculated as the average of the last 12 months.
Return on equity measures the return generated on owners' invested capital.
Return on working capital (P/WC)¹
EBITA divided by working capital.
P/WC is used to analyse profitability and is a measure that encourages high EBITA and low working capital requirements, see the reconciliation table on page 25.
Return on capital employed¹
Profit before tax plus financial expenses as a percentage of capital employed. The components are calculated as the average of the last 12 months.
Return on capital employed shows the Group's profitability in relation to externally financed capital and equity, see the reconciliation table on page 25.
EBITA¹
Operating profit before amortisation of intangible assets.
EBITA is used to analyse the profitability generated by operating activities, see reconciliation table on page 25.
EBITA-margin¹
EBITA as a percentage of net sales.
EBITA margin is used to the show the degree of profitability in operating activities.
EBITDA¹
Operating profit before depreciation and amortisation.
EBITDA is used to analyse the profitability generated by operating activities, see reconciliation table on page 25.
Equity per share¹
Equity divided by number of shares outstanding at the reporting period's end.
This measures how much equity is attributable to each share and is published to make it easier for investors to conduct analyses and make decisions.
Financial net debt¹
The net of interest-bearing debt and provisions minus cash and cash equivalents.
Net debt is used to monitor changes in debt, analyse the Group indebtedness and its ability to repay its debts using liquid funds generated from the Group's operating activities if all debt fell due for repayment today and any necessary refinancing.
Financial net debt/EBITDA¹
Net financial debt divided by EBITDA.
Net financial debt compared with EBITDA provides a performance measure for net debt in relation to cash-generating earnings in the business, i.e. it gives an indication of the business' ability to repay its debts. This measure is generally used by financial institutions to measure creditworthiness.
Financial items¹
Finance income minus finance costs.
Used to describe changes in the Group's financial activities.
Acquired growth¹
Changes in net sales attributable to business acquisitions compared with the same period last year.
Acquired growth is used as a component to describe the change in consolidated net sales in which acquired growth is distinguished from organic growth, divestments and exchange rate effects, see reconciliation table on page 25.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
Cash flow from operating activities per share¹
Cash flow from operating activities, divided by the average number of outstanding shares after repurchase.
This measure is used so investors can easily analyse the size of the surplus generated per share from operating activities.
Net investments in non-current assets¹
Investments in non-current assets minus sales of non-current assets.
This measure is used to analyse the Group's investments in renewing and developing property, plant and equipment.
Net debt excluding pensions¹
The net of interest-bearing debt and provisions excluding pensions minus cash and cash equivalents.
A measure used to analyse financial risk, see reconciliation table on page 25.
Net debt excluding pensions/ equity ratio¹ ²
Net debt excluding pensions divided by shareholders' equity.
A measure used to analyse financial risk, see reconciliation table on page 25.
Organic growth¹
Changes in net sales excluding currency effects, acquisitions and divestments compared with the same period last year.
Organic growth is used to analyse underlying sales growth driven a change in volumes, product range and price for similar products between different periods, see reconciliation table on page 25.
Profit after financial items¹
Profit/loss for the period before tax.
Used to analyse the business' profitability including financial activities.
Earnings per share (EPS)
Shareholders' share of profit for the period after tax, divided by the weighted average number of shares during the period.
Earnings per share (EPS), diluted
Shareholders' share of profit for the period after tax, divided by the weighted average number of shares during the period, adjusted for the additional number of shares in the event of outstanding options being used.
Interest coverage ratio¹
Earnings after net financial items plus interest expense and bank charges divided by interest expense and bank charges.
This performance indicator measures the Group's capacity through its business operations and finance income to generate a sufficiently large surplus to cover its finance costs, see reconciliation table on page 25.
Working capital¹
Working capital (WC) is measured through an annual average defined as inventories plus accounts receivable less accounts payable.
Working capital is used to analyse how much working capital is tied up in the business, see reconciliation table on page 25.
Operating margin¹
Operating profit as a percentage of net sales.
This measure is used to specify the percentage of sales that is left to cover interest and tax, and to provide a profit, after the company's costs have been paid.
Operating profit¹
Operating income minus operating expenses.
Used to describe the Group's earnings before interest and tax.
Debt/equity ratio¹²
Financial net liabilities divided by equity.
A measure used to analyse financial risk.
Equity ratio¹²
Equity as a percentage of total assets.
The equity/assets ratio is used to analyse financial risk and show the percentage of assets that are funded with equity.
Capital employed¹
Total assets minus non-interest-bearing liabilities and provisions.
Capital employed shows the size of the company's assets that have been lent to the company's owners or that have been lent out by lenders, see reconciliation table on page 25.
Outstanding shares
Total number of shares less treasury shares repurchased by the Company.
¹The performance measure is an alternative performance measure according to ESMA's guidelines.
²Minority interest is included in equity when the performance measures are calculated.
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021
RECONCILIATION TABLES ALTERNATIVE PERFORMANCE MEASURES
| EBITA and EBITDA | ||||
|---|---|---|---|---|
| Addtech Group, SEKm | 12 months ending | |||
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 | |
| Operating profit (EBIT) | 989 | 1,161 | 910 | 701 |
| Amortization, intangible assets (+) | 262 | 203 | 175 | 137 |
| EBITA | 1,251 | 1,364 | 1,085 | 838 |
| Depreciation, tangible assets (+) | 250 | 215 | 52 | 43 |
| EBITDA | 1,501 | 1,579 | 1,137 | 881 |
| Working capital and return on working capital (P/WC) | ||||
| --- | --- | --- | --- | --- |
| Addtech Group, SEKm | 12 months ending | |||
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 | |
| EBITA (12 months rolling) | 1,251 | 1,364 | 1,085 | 838 |
| Inventory, yearly average (+) | 1,722 | 1,594 | 1,304 | 1,037 |
| Accounts receivables, yearly average (+) | 1,756 | 1,854 | 1,542 | 1,231 |
| Accounts payables, yearly average (-) | 1,062 | 1,033 | 817 | 677 |
| Working capital (average) | 2,416 | 2,415 | 2,029 | 1,591 |
| Return on working capital (R/RK) (%) | 52% | 56% | 53% | 53% |
| Acquired- and organic growth | ||||
| --- | --- | --- | --- | --- |
| 3 months | ||||
| Addtech Group | 31 Mar 2021 | 31 Mar 2020 | ||
| Acquired growth (SEKm,%) | 281 | (9%) | 193 | (7%) |
| Organic growth (SEKm,%) | -310 | (-10%) | -25 | (-1%) |
| Divestments (SEKm,%) | -1 | (0%) | -2 | (0%) |
| Exchange rate effect (SEKm,%) | -81 | (-3%) | 8 | (0%) |
| Total growth (SEKm,%) | -111 | (-4%) | 174 | (6%) |
| Interest coverage ratio | 12 months ending | |||
| --- | --- | --- | --- | --- |
| Addtech Group | 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 |
| Profit after financial items, SEKm | 937 | 1,105 | 865 | 665 |
| Interest expenses and bank charges (+), SEKm | 63 | 57 | 41 | 31 |
| Total | 1,000 | 1,162 | 906 | 696 |
| Interest coverage ratio, multiple | 15.8 | 20.5 | 22.1 | 22.7 |
| Net debt excl. pensions and net debt, excl pensions/equity ratio | ||||
| --- | --- | --- | --- | --- |
| Addtech Group | 12 months ending | |||
| 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 | |
| Financial net debt, SEKm | 3,134 | 2,585 | 1,960 | 1,405 |
| Pensions (-), SEKm | -336 | -332 | -260 | -229 |
| Net debt excluding pensions, SEKm | 2,798 | 2,253 | 1,700 | 1,176 |
| Equity, SEKm | 3,450 | 3,076 | 2,520 | 2,131 |
| Net debt to Equity ratio (excluding pensions), multiple | 0.8 | 0.7 | 0.7 | 0.6 |
| Capital employed and return on capital employed | ||||
| --- | --- | --- | --- | --- |
| Addtech Group, SEKm | 31 Mar 2021 | 31 Mar 2020 | 31 Mar 2019 | 31 Mar 2018 |
| Profit after financial items | 937 | 1,105 | 865 | 665 |
| Financial expenses (+) | 93 | 79 | 62 | 71 |
| Profit after financial items plus financial expenses | 1,030 | 1,184 | 927 | 736 |
| Total assets, yearly average (+) | 9,309 | 7,926 | 6,324 | 4,996 |
| Non-interest-bearing liabilities, yearly average (-) | -2,153 | -1,947 | -1,604 | -1,319 |
| Non-interest-bearing provisions, yearly average (-) | -413 | -379 | -378 | -335 |
| Capital employed | 6,743 | 5,600 | 4,342 | 3,342 |
| Return on capital employed, % | 15% | 21% | 21% | 22% |
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 - 31 MARCH 2021
This is Addtech
Addtech is a Swedish, listed technical solutions group that combines the flexibility and speed of a small company with the resources of a large company. We acquire, own and develop independent subsidiaries that sell various high-tech products and solutions to customers, primarily within industry and infrastructure. With in-depth expertise in a number of different niches, our subsidiaries generate added technical, financial and sustainable value for customers and suppliers alike, thus helping increase the efficiency and competitiveness of all involved. We currently own some 140 companies in 20 countries, and have a long history of sustainable, profitable growth.
Our vision
We are to be the leader in value-creating technical solutions for a sustainable tomorrow, perceived as the most skilled and long-term partner of our customers, suppliers and employees.
Business concept in brief
Addtech offers high-tech products and solutions for companies in the manufacturing and infrastructure sectors. Addtech contributes added technical and financial value by being a skilled and professional partner for customers and manufacturers.
We build shareholder value through:
- our 140 subsidiaries and their capacity to generate earnings growth
- corporate governance that ensures the companies achieve even better results and development
- acquisitions that bring in new employees, customers and suppliers
ADDTECH AB (PUBL.) Org.nr: 556302-9726, Box 5112, 102 43 Stockholm, Visiting address: Birger Jarlsgatan 43 Tel: +46 8 470 49 00, [email protected]
ADDTECH AB (PUBL.) YEAR-END REPORT 1 APRIL 2020 – 31 MARCH 2021