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CTT Systems

Quarterly Report Feb 8, 2023

3033_10-k_2023-02-08_61027b46-7351-4557-8551-323c6f878155.pdf

Quarterly Report

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Interim Report Fourth Quarter 20221 Year-end report 20221

FOURTH QUARTER 20222)

  • Net sales increased by 61% to MSEK 67.8 (42.1) $\bullet$ - Currency adjusted increase of 33%
  • Operating profit (EBIT) increased to MSEK 20.8 (8.0) $\bullet$
  • Operating margin (EBIT margin) increased to 31% (19)
  • Net profit amounted to MSEK 17.8 (4.3)
  • Earnings per share were SEK 1.42 (0.34) $\bullet$
  • Operating cash flow decreased to MSEK 17.9 (20.4)

JANUARY - DECEMBER 20222)

  • Net sales increased by 59% to MSEK 240.6 (151.2) $\bullet$ - Currency adjusted increase of 36%
  • Operating profit (EBIT) increased to MSEK 91.8 (26.8) $\bullet$
  • Operating margin (EBIT margin) increased to 38% (18) $\bullet$
  • Net profit amounted to MSEK 66.3 (14.2) $\bullet$
  • Earnings per share were SEK 5.29 (1.13)
  • Operating cash flow increased to MSEK 61.2 (30.3)
  • The Board of Directors proposes a dividend of SEK 4.05 per share (0.79)

FORECAST - FIRST QUARTER 2023 2)

The net sales forecast for the first quarter of 2023 is MSEK 68 - 73 (49.2).

CTT IN BRIEF

2022 Change from 2021 2022 2021 Rolling
(MSEK) 'Oct-Dec previous year Oct-Dec Jan-Dec Jan-Dec 12 months
Net sales 67.8 61% 42.1 240.6 151.2 240.6
Operating profit (EBIT) 20.8 160 % 8.0 91.8 26.8 91.8
Profit (loss) this period 17.8 314 % 4.3 66.3 14.2 66.3
Earnings per share (SEK) 1.42 318 % 0.34 5.29 1.13' 5.29
Operating cash flow 17.9 $-12%$ 20.4 61.2 30.3 61.2

CTT - WORLD LEADER IN ACTIVE HUMIDITY CONTROL IN AIRCRAFT

CTT is the leading supplier of active humidity control systems in aircraft. We solve the aircraft humidity paradox - with far too dry cabin air - and too much moisture in the fuselage - causing dehydration for people onboard and excess weight in the aircraft inducing larger environmental footprint. CTT offers humidifiers and dehumidifiers available for retrofit and line-fit on commercial aircraft as well as private jets. For more information about CTT and how active humidity control products make air traveling a little more sustainable and far more pleasurable, please visit: www.ctt.se

1) This Interim report is a translation of the original report published in Swedish. In the event of any deviations between the two reports, the Swedish version prevails.

2) Unless otherwise stated, outcome comparisons with a previous period in this Interim report refer to the corresponding period of the preceding year, and the value is given in brackets.

COMMENTS FROM THE CEO

Net sales in Q4 increased and met forecast

Net sales in Q4 met the forecast and increased for the seventh consecutive quarter, driven by higher sales in OEM and Private jet but offset by a small decline in aftermarket sales that remained at record-high level due to distributor inventory build-up.

When summarizing Full-Year 2022, net sales increased 59% to MSEK 241, mainly driven by aftermarket revenues that jumped 90% to MSEK 187. Favorable sales mix and currency tailwind underpinned net profit and boosted operating margin to 38% (18). This level is not sustainable as it derives from extraordinary conditions that jointly reinforced our margin in 2022. I reiterate that a weaker USD/SEK will have negative impact on profitability as well as when system sales increase faster than aftermarket sales.

Net sales forecast: MSEK 68 - 73

The forecast for the first quarter of 2023 is MSEK 68 - 73 in net sales, driven by quarter-to-quarter increase in OEM sales and higher booked revenues from Private jet projects, offset by a significant sales decrease in the aftermarket (due to high inventory level at distributors and airlines driven by the build-up in Q3 and Q4).

System deliveries to rebound

As international air traffic rebounds, conditions gradually improve for our OEM and Retrofit businesses. The positive momentum we have generated in 2022 gives us confidence in our growth expectations of both sales and orders in 2023. We will benefit from a rebound in aircraft production rates of Boeing 787 and Airbus A350. Further, we expect that the better business environment will start to generate Retrofit orders (again). We also have good momentum in our Private jet business.

As part of our strategy, we continue to invest to reach new opportunities. We particularly focus to extend and improve our offering in Private jet. The cooperation with Airbus Corporate Jets is a success in the marketplace and marks a paradigm-shift when the humidification system is offered by the OEM. We have initiated similar discussions with other OEMs in the Private Jet market.

Aftermarket demand to grow but at significantly slower pace

In most regions utilization of our products is back to normal but remains at low level in Asia/China. During 2023 the pandemic rebound effect gradually will fade and demand in the aftermarket will then again track population size. The drivers of installed base will be new system deliveries and when ready-built Boeing 787s enter-into-service (with CTT products already on board - representing approx. 10 % population growth to CTT). Underlying demand in the aftermarket will therefore grow at slower pace compared to past years (driven by strong pandemic rebound in utilization from low level). Our actual sales in the aftermarket need some quarters to consolidate supply and demand, as we enter the year with high inventory level at distributors and airlines.

As part of our long-term strategy, we continue to invest to protect our aftermarket. We have strengthened our partnerships and made investments to improve and add functionality as well as to enable better availability of our consumables and spares. In 2022, we took measures to inform the industry about a pad PMA1 that is available for use in our humidifiers on Boeing 787 aircraft. The third-party pad does

not meet the specs set by Boeing and it comprises substantial performance and quality issues. This PMA product uses a commodity pad-material that is not designed for aviation and does not comply with several requirements. The original by CTT is a highly qualified product with a specific pad material that is developed accordingly by specs from Airbus and Boeing. Competition in the aftermarket is inevitable, but CTT is in a strong position with leading application knowledge, unique material and with a battle-proven product that meets all requirements.

Strong position to grow sales in 2023

We generated operating cash flow of MSEK 61 (30) and ended the year with a net cash position of MSEK 15. We have a strong financial position and cash flow that enable both a good return to our shareholders and investments for growth. The Board of Directors proposes an ordinary dividend of SEK 4.05 per share (same level as 2018 and 2019).

Finally. I am proud be part of this fantastic company. As a team and in collaboration with our customers and partners, we can continue to generate strong and sustainable value to customers and shareholders. I really look forward to my first full year at CTT.

Henrik Höjer, CEO

1 Parts Manufacturer Approval (PMA) is an approval granted by the United States Federal Aviation Administration (FAA) to a manufacturer of aircraft parts

EVENTS DURING THE QUARTER

√ 13.12.2022: CTT Systems AB receives an Inflight Humidification ("IFH") VIP system order from PMV Engineering to be installed on an Airbus ACJ320 aircraft. The system consists of two humidifiers and one anti-condensation unit and is scheduled to be delivered in the first quarter of 2023. This is the fourth order on ACJ320 in cooperation with ACJ and PMV.

SIGNIFICANT EVENTS DURING THE YEAR

$\checkmark$ 17.03.2022: CTT Systems AB signs a development agreement with Airbus Corporate Jets (ACJ) regarding Inflight Humidification (IFH) system for the ACJ TwoTwenty Xtra large business jet. Under the partnership CTT and ACJ will design the system together and CTT will develop the humidification system consisting of four humidifiers and one anti-condensation unit.

OTHER EVENTS DURING THE YEAR

  • $\checkmark$ .01.03.2022: CTT Systems AB stops all deliveries to Russia, according to current sanctions. Russia's share of 2021 revenues were 4%, mainly from the Retrofit area. CTT has no employees nor suppliers in Russia, Belarus or Ukraine. No deliveries to Russia during 2022.
  • ✓ 01.04.2022: CTT Systems ABs new CEO Henrik Höjer takes office as planned.
  • ✓ 15.09.2022: CTT Systems AB presents the Nomination Committee for the Annual General Meeting 2023

EVENTS AFTER THE END OF THE REPORTING PERIOD

No significant events have occurred after the end of the reporting period.

NET SALES

Net sales increased by 61% in the fourth quarter to MSEK 67.8 (42.1). Adjusted for currency, sales increased by 33%2, driven by the gradual improvement in the aftermarket and revenue arowth from Private jet projects. Quarterly revenues from the aftermarket exceeded underlying demand and remained at the record high level of the previous quarter, partly due to inventory build-up at distributors. OEM revenues decreased to MSEK 4.1 (5.5), mainly due to the decreased aircraft production rate by Boeing in the 787-program. Private jet revenues increased to MSEK 5.5 (2.6). No Retrofit deliveries during the quarter.

Net sales in the full year of 2022 increased by 59% to MSEK 240.6 (151.2). Adjusted for currency, sales increased by 36%, driven mainly by gradual improvement in the aftermarket and increased revenues in Private jet mainly driven by the ACJ cooperation.

CTT has reported seven consecutive quarters with net sales growth, from pandemic low point in the first quarter of 2021, mainly driven by the recovery and growth in the aftermarket.

The graph above shows quarterly net sales and rolling four quarters average.

$12$ The average USD currency rate in the third quarter was 10,96 (8.85).

BREAKDOWN OF NET SALES

NET SALES (MSEK) Q121 Q221 Q321 Q421 2021 0122 Q 222 0322 Q422 2022
System Sales
0EM 4.8 8.0 6.3 5.5 24.7 7.2 6.4 2.5 4. 20.2
Retrofit 1.3 0.0 1.7 4.5 7.6
Private jet 3.2 2.5 1.4 2.6 9.7 2.5 8.5 4.0 5.5 20.5
Total 9.3 10.5 9.5 12.6 42.0 9.7 14.9 6.4 9.7 40.7
Aftermarket 20.5 24.3 27.8 25.9 98.6 36.7 40.1 56.1 54.0 186.9
Sales in addition to the core business activities 1.7 2.6 2.9 3.5 10.7 2.8 3.4 2.8 4.1 13.0
TOTAL 31.4 37.5 40.2 42.1 151.2 49.2 58.4 65.3 67.8 240.6
Of which projects where there is recognition of 3.2 0.3 1.5 2.6 7.6 2.5 8.5 3.6 5.5 20.2

profits that is reported as revenue over time.

(Other income is recognised at a defined point in time,

i.e. upon delivery.)

The breakdown of net sales for the quarters is presented above.

FINANCIAL RESULTS

The operating profit (EBIT) increased to MSEK 20.8 (8.0), corresponding to a margin of 31% (19). The EBIT increase was mainly driven by increased volume in aftermarket sales and positive impact from currency. compared to last year. The US dollar rate has however weakened during the quarter, resulting in negative currency effects from AR/AP valuation by MSEK 3.7 (1.9). Finance net was positively affected by currency effects of MSEK 2.4 (-2.3) from USD loans. Higher result leads to increased allocation for variable remuneration to the employees with MSEK 2.5 (0.7). mainly explaining the increased other costs. Profit for the period was MSEK 17.8 (4.3). Earnings per share increased to SEK 1.42 (0.34).

EBIT bridge Q4 2021 to Q4 2022 (MSEK)

For the full year 2022 the operating profit (EBIT) was MSEK 91.8 (26.8), corresponding to a margin of 38% (18). The EBIT increase was mainly driven by gradual improvement in the aftermarket and from a stronger USD rate. Profit for the year was MSEK 66.3 (14.2). Earnings per share increased to SEK 5.29 (1.13).

Average USD / SEK exchange rate according to Riksbanken

FORECAST - FIRST QUARTER 2023

The net sales forecast for the first quarter of 2023 is MSEK 68 - 73 (49.2).

FOURTH QUARTER 2022 FORECAST AND ACTUAL OUTCOME

In the third quarter report (2022). CTT made the following forecast for the fourth quarter of 2022: "The net sales forecast for the fourth quarter of 2022 is MSEK 65 - 70 (42.1), and MSEK 238 - 243 (151.2) for the full year."

The actual net sales amounted to MSEK 67.8 for the quarter and MSEK 240.6 for the full year.

ORDER INTAKE AND ORDER BACKLOG

During the fourth quarter, the Company's order intake amounted to MSEK 52 (46). The stronger order intake compared to previous vear is mainly explained by the recovery and growth in the aftermarket. OEM order intake was low due to lower build-rate by Boeing in the 787 program. CTT received one new Private jet order during the quarter, to be delivered during the first quarter 2023, with revenue recognition on delivery.

As of 31 December 2022, the order book totaled MSEK 73 (59), based on USD exchange rate of 10.55 (8.98).

CASH FLOW AND FINANCIAL POSITION

Cash flow before changes in working capital increased to MSEK 19.0 (8.1) in the fourth quarter, driven by better EBITDA (MSEK 22.7 compared to 9.7). The cash flow from operating activities decreased to MSEK 17.9 (20.4). Changes in working capital was in total MSEK -1.1 (12.3), where the inventory temporally increased by MSEK 2.1, offset by positive changes in account receivables and account pavables by MSEK 1.0 in total. Net cash flow in the reporting period was MSEK 16.4 (17.7). The change in the quarter is described in the graph on the right.

Cash flow before changes in working capital increased to MSEK 93.0 (27.7) during January - December. The cash flow from operating activities increased to MSEK 61.2 (30.3), mainly driven by the improved financial performance (EBITDA). Paid income tax amounts to only MSEK 5.2 during the year, as CTT received tax refund for 2021 and paid too low a preliminary tax for 2022. Debt at the end of 2022 is MSEK 7.3. Dividend and variable renumeration affected cash flow with MSEK 12.2.

Cash flow bridge 03 2022 to 04 2022 (MSEK)

See Cash flow analysis on page 12

Long-term interest-bearing loan liabilities decreased to MSEK 44 (71). The decline from previous year is mainly related to an amortization of an USD credit facility of MSEK 32 in the first quarter.

Overall. CTT has a strong financial position, with its equity ratio at 31 December 2022 amounting to 71% (65). Cash and cash equivalents amounted to MSEK 60 (49), and in addition CTT has available credit facilities of MSEK 51. Net debt as of 31 December 2022 amounted to MSEK -15 (23), and equity to MSEK 269 (213).

INVESTMENTS

Investments in the fourth quarter amounted to MSEK 1.1 (2.3) and during the full year 2022 MSEK 7.6 (8.6) related to ongoing development projects, many in the final stage which explains the relative low investment level.

PERSONNEL

The average number of employees during the fourth quarter was 73 (76). For the full year 2022 the corresponding number was 74 (82).

Risks and uncertainties

The risks in the Company's business operations can generally be divided into operational risks related to its business operations and financial risks related to its financial activities. No significant changes in material risks or uncertainties have arisen during the period. but CTT, as before, has an unusually one-sided currency impact since basically all sales are made in USD. The company has chosen not to use forward hedging of USD, however, purchases and bank loans in USD are sought. Major changes in the USD/SEK exchange rate lead to material currency effects. The high inflation and interest rate environment have no material impact during the period. A detailed account of CTT's risks, uncertainties and their management can be found on pages 54 - 58 of the Company's Annual Report for 2021.

SHAREHOLDERS

Number
CTT's five largest shareholders as at 31/12/2022 of shares Capital Votes
Tomas Torlöf 1 678 336 $13.4\%$ 13.4%
SEB Funds 1 175 018 9.4% 9.4%
Collins Aerospace 1 133 154 9.0% 9.0%
ODIN Funds 1 100 000 8.8% 8.8%
Third Swedish National Pension Fund 559 036 4.5% 4.5%

For information about the Company's 20 largest shareholders, please refer to the company's website www.ctt.se.

RELATED PARTY TRANSACTIONS

There have been no significant transactions with related parties during the quarter or the year.

To the extent that transactions and agreements for services with related parties are entered into, these are always entered into and performed under market conditions.

ACCOUNTING AND VALUATION POLICIES

This report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act, taking into account the exceptions and additions to IFRS as set out in the Swedish Financial Reporting Board's Recommendation RFR 2 -Accounting for Legal Entities. Unless stated otherwise below, the accounting policies applied correspond with the accounting policies applied in the preparation of the most recent annual financial statements.

New and amended accounting policies 2022

No new or updated standards issued by the IASB and interpretative statements by the IFRIC have had any material effect on the Company's financial position, profits or disclosures.

FINANCIAL CALENDAR

Publishing the Annual Report 2022 (www.ctt.se) Interim Report Q1 2023 AGM Interim Report Q2 2023 Interim Report Q3 2023

31/03/2023 28/04/2023 at 08:00 (CEST) 04/05/2023 at 17:00 (CEST) 21/07/2023 at 08:00 (CEST) 27/10/2023 at 08:00 (CEST)

The Board of Directors and the Chief Executive Officer represent and warrant that this interim report provides a true and fair view of the Company's business operations, position and performance and describes the material risks and uncertainties facing the Company. This information is such as CTT Systems AB (publ.) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Market Act and/or the Swedish Financial Instruments Trading (Market Abuse Penalties) Act. The information was submitted for publication at 8:00 (CET) on February 7th, 2023.

Nyköping, 6 February 2023

CTT Systems AB (publ.)

Tomas Torlöf Chairman of the Board

Steven Buesing Board Member

Annika Dalsvall Board Member

Per Fyrenius Board Member

Anna Carmo E Silva Board Member

Björn Lenander Board Member

Henrik Höjer CE0

This report has not been audited by the Company's auditors.

FURTHER INFORMATION

For additional information, please contact:

Henrik Höier, CEO CTT Systems AB Box 1042 SE-611 29 NYKÖPING Tel: 46 (0)155-20 59 01 E-mail: [email protected]

Markus Berg. CFO CTT Systems AB Box 1042 SE-611 29 NYKÖPING Tel: 46 (0)155-20 59 05 E-mail: [email protected]

Company reg. no.: 556430-7741 Website: www.ctt.se

CTT IN BRIEF

CTT is a market-leading manufacturer of equipment for active control of humidity in aircraft. CTT's dehumidifier and humidifier products minimize fuselage condensation issues and increase cabin air humidity. CTT is a supplier to Boeing and Airbus and has many of the world's largest airlines as its customers.

CTT has been traded on Nasdag Stockholm since March 1999, currently on the Mid Cap list and has its registered offices in Nyköping.

CTT SYSTEMS AB 2022 2021 2022 2021
INCOME STATEMENT in brief (MSEK) Oct-Dec Oct-Dec Jan-Dec Jan-Dec
Operating income
Net sales 67.8 42.1 240.6 151.2
Change in stocks of work in progress and stocks of finished goods 1.1 1.7 2.8 1.9
Own work capitalised 0.4 0.8 3.4 3.0
Other operating income 2.4 2.8 16.5 20.1 0
Total operating income 71.8 47.4 263.3 176.2
Operating expenses
Raw materials and consumables $-14.4$ $-9.9$ $-49.4$ $-37.7$
Other external costs $-10.3$ $-10.1$ $-35.4$ $-35.6$
Employee benefit expense $-18.2$ $-16.9$ $-69.1$ $-61.5$
Depreciation and amortisation of property, plant and
equipment and intangible assets $-1.9$ $-1.7$ $-7.9$ $-11.3^{D}$
Other operating expenses $-6.1$ $-0.8$ $-9.6$ $-3.3$
Total operating expenses $-51.0$ $-39.4$ $-171.5$ $-149.4$
Operating profit (EBIT) 20.8 8.0 91.8 26.8
Net gain/loss on financial items 1.9 $-2.6$ $-8.0$ $-8.9$
Profit before tax 22.7 5.4 83.8 17.9
Tax $-4.9$ $-1.1$ $-17.5$ $-3.7$
Profit (loss) this period 17.8 4.3 66.3 14.2
Other comprehensive income
Comprehensive income for the period 17.8 4.3 66.3 14.2
Earnings per share, SEK 1.42 0.34 5.29 1.13

$^{D}$ One-off items from OEM segment have effected other operating income positively with MSEK 9.1 and amortisation negatively with MSEK 4.3. Net EBIT effect amounted to MSEK +4.8.

CTT SYSTEMS AB
BALANCE SHEET in brief (MSEK)
2022
31 Dec
2021
31 Dec
Assets
Intangible assets 80.2 75.9
Property, plant and equipment 43.2 48.1
Financial assets 2.1 1.9
Other current assets 191.6 153.4
Cash at bank and in hand 60.1 49.3
Total assets 377.1 328.5
Equity and liabilities
Equity 269.3 212.9
Provisions 3.4 3.8
Non-current liabilities, interest-bearing 43.9 70.8
Current liabilities, interest-bearing 1.6 1.4
Current liabilities, non-interest-bearing 59.0 39.7
Total equity and liabilities 377.1 328.5
Opening equity 212.9 220.5
Share dividend $-9.9$ $-21.8$
Profit (loss) this period 66.3 14.2
Closing equity 269.3 212.9
CTT SYSTEMS AB 2022 2021 2022 2021
CASH FLOW ANALYSIS (MSEK) Oct-Dec Oct-Dec Jan-Dec Jan-Dec
Operating activities
Operating profit (EBIT) 20.8 8.0 91.8 26.8 0
Adjustment for items not included in cash flow
Depreciation and amortisation 1.9 1.7 7.9 11.3 0
Other $-0.5$ $-0.9$ $-0.6$ $-2.4$
Financial receipts 0.2 0.5 $\overline{\phantom{a}}$
Financial payments $-0.6$ $-0.3$ $-1.5$ $-1.2$
Income tax paid $-2.7$ $-0.5$ $-5.2$ $-6.8$
Cash flow from operating activities
before changes in working capital 19.0 8.1 93.0 27.7
Cash flow from changes in working capital
Change in inventories $-2.1$ $-1.8$ $-16.0$ 0.9
Change in operating receivables $-3.7$ 9.2 $-17.3$ 6.2
Change in operating liabilities 4.7 4.8 1.5 $-4.4$
Cash flow from changes in working capital $-1.1$ 12.3 $-31.7$ 2.6
Operating cash flow 17.9 20.4 61.2 30.3
Investment activities
Acquisition of intangible assets $-1.0$ $-2.1$ $-6.5$ $-8.4$
Acquisition of property, plant and equipment 0.0 $-0.2$ $-0.9$ $-0.2$
Acquisition of financial assets $-0.1$ $-0.3$
Sale of property, plant and equipment $0.0\,$ 0.2 0.1
Cash flow from investment activities $-1.1$ $-2.3$ $-7.3$ $-8.6$
Financing activities
Proceeds from borrowings 29.7
Repayments of borrowings $-0.4$ $-0.3$ $-33.7$ $-1.3$
Dividends paid $-9.9$ $-21.8$
Cash flow from financing activities $-0.4$ $-0.3$ $-43.6$ 6.6
Cash flow for the period 16.4 17.7 10.3 28.4
Cash and cash equivalents at the beginning of the period 44.1 31.9 49.3 21.6
Exchange gains/losses on cash and cash equivalents $-0.4$ $-0.3$ 0.5 $-0.7$
Cash and cash equivalents at the end of the period 60.1 49.3 60.1 49.3

1) One-off items from OEM segment have effected other operating income and cash flow positively with MSEK 9.1 and amortisation negatively with MSEK 4.3. Net EBIT effect amounted to MSEK +4.8.

Interim Report Fourth Quarter 2022
Year-end report 2022

CTT SYSTEMS AB 2022
2021
2020
KEY FIGURES - INDIVIDUAL QUARTERS Q4 Q3 Q 2 Q1 Q4 Q 3 Q 2 Q1 Q4
Sales & Financial result
Net sales, MSEK
Operating profit (EBIT), MSEK
Operating margin, %
Profit margin, %
Profit (loss) this period, MSEK
Return on capital employed, %
Return on equity, %
Return on total capital, %
67.8
20.8
31
33
17.8
7
7
6
65.3
33.5
51
46
23.9
12
$10\,$
q
58.4
23.5
40
33
15.1
9
7
6
49.2
14.0
29
24
9.6
5
4
4
42.1
8.0
19
13
4.3
3
2
$\overline{2}$
40.2
11.5
29
22
7.0
4
3
$\overline{3}$
37.5
6.6
18
21
6.1
$\overline{2}$
3
3
31.4
0.6
2
$-13$
$-3.2$
0
-1
$-1$
34.9
$-0.6$
$-2$
$\overline{I}$
1.9
0
1
1
Share data
Earnings per share, SEK
Equity per share, SEK
Operating cash flow per share, SEK
Dividend per share, SEK
Number of shares, end of reporting period, thousands
Average number of shares in the period, thousands
Market price at the close of the reporting period, SEK
1.42
21.49
1.43
4.05
12 5 29
12 5 29
213.50
1.90
20.07
2.46
12 5 29
12 5 29
199.00
1.21
18.17
0.32
12 5 29
12 5 29
198.00
0.76
17.75
0.68
12 5 29
12 5 29
191.60
0.34
16.99
1.63
0.79
12 5 29
12 5 29
216.50
0.56
16.65
0.77
12 5 29
12 5 29
210.00
0.49
16.09
0.58
12 5 29
12 5 29
216.50
$-0.26$
17.34
$-0.55$
L,
12 5 29
12 5 29
153.60
0.15
17.60
$-0.09$
1,74
12 5 29
12 5 29
152.20
Cash flow & Financial position
Operating cash flow, MSEK
Quick ratio, %
Interest Coverage ratio, times
Debt-equity ratio, times
Equity ratio, %
17.9
267
34
0.2
71
30.8
267
59
0.2
71
4.0
239
69
0.2
70
8.6
228
26
0.2
71
20.4
305
21
0.3
65
9.6
323
32
0.3
65
7.2
320
27
0.3
66
$-6.9$
304
$-7$
0.3
66
$-1.1$
218
12
0.2
72
Personnel & Investments
Number of employees, (average for the period) 1)
Income (valued at full year) per employee, MSEK
Investments, MSEK
73
3.9
1.1
72
4.0
2.3
74
3.6
2.4
75
2.9
1.8
76
2.5
2.3
76
2.3
1.2
78
2.5
2.4
85
18
2.7
88
$1.6\,$
7.1
FINANCIAL HIGHLIGHTS - ACCUMULATED $Q1 - Q4$ $Q1-Q4$ $Q1-Q4$
Sales & Financial result
Net sales, MSEK
Operating profit (EBIT), MSEK
Operating margin, %
Profit margin, %
Profit (loss) this period, MSEK
Return on capital employed, %
Return on equity, %
Return on total capital, %
240.6
91.8
38
35
66.3
30
28
24
151.2
26.8
18
12
14.2
$10\,$
7
$\boldsymbol{6}$
200.8
38.4
19
20
31.1
14
13
12
Share data
Earnings per share, SEK
Operating cash flow per share, SEK
5.29
4.89
1.13
2.42
2.48
$-0.86$
Cash flow & Financial position
Operating cash flow, MSEK
Quick ratio, %
Interest Coverage ratio, times
Debt-equity ratio, times
Equity ratio, %
61.2
267
44
0.2
71
30.3
305
14
0.3
65
$-10.8$
218
35
0.2
72
Personnel & Investments
Number of employees, (average for the period) 1)
Income (valued at full year) per employee, MSEK
Investments, MSEK
74
3.6
7.6
82
2.1
8.6
98
2.4
33.8

1) The average of employees for the period is an approximation where a calculation is made by taking the average of the number of employees
at closing balance and opening balance respectively during the period. The exact

CTT SYSTEMS AB
RELEVANT RECONCILIATIONS OF KEY FIGURES (MSEK)
2022
$Q1 - Q4$
2021
$Q1 - Q4$
2020
$Q1 - Q4$
Operating margin
Operating profit (EBIT) 91.8 26.8 38.4
Net sales 240.6 151.2 200.8
Operating margin 38% 18% 19%
Profit margin
Profit before tax 83.8 17.9 39.6
Net sales 240.6 151.2 200.8
$=$ Profit margin 35% 12% 20%
Return on capital employed
(Operating profit, EBIT
+ Finance income)
91.8
0.5
26.8
0.0
38.4
0.0
/ Average capital employed
Average total capital (total assets) 352.8 318.0 335.2
Total capital at the beginning of the period 328.5 307.5 362.8
Total capital at the end of the period 377.1 328.5 307.5
- Average non-interest-bearing liabilities including deferred taxes $-49.3$ $-44.9$ $-70.1$
Non-interest-bearing liabilities including deferred taxes, beginning of the period $-39.7$ $-50.1$ $-90.2$
Non-interest-bearing liabilities including deferred taxes, end of the period
Total average capital employed
$-59.0$
303.5
$-39.7$
273.1
$-50.1$
265.0
Return on capital employed 30% 10% 14%
Return on equity
Profit (loss) this period
66.3 14.2 31.1
/ Average equity 241.1 216.7 230.3
Equity at the beginning of the period 212.9 220.5 240.2
Equity at the end of the period 269.3 212.9 220.5
$=$ Return on equity 28% 7% 13%
Return on total capital
(Profit before tax 83.8 17.9 39.6
Finance costs) $-2.0$ $-1.4$ $-1.2$
Average total capital (for the calculation, see "Return on capital employed") 352.8 318.0 335.2
Return on total capital
$\equiv$
24% 6% 12%
Quick ratio
(Current assets, i.e. other current assets plus cash & bank deposits 251.7 202.8 179.0
Inventories 116.4 100.4 101.2
Granted unutilised line of credit) 26.4 22.8 20.7
Current liabilities
Quick ratio
60.5
267%
41.1
305%
45.2
218%
Interest Coverage ratio
(Profit before tax
Finance costs)
83.8
$-2.0$
17.9
$-1.4$
39.6
$-1.2$
Finance costs $-2.0$ $-1.4$ $-1.2$
= Interest Coverage ratio, times 44 14 35
Debt-equity ratio
Interest-bearing liabilities, i.e. total interest-bearing items on balance sheet's debt side 45.4 72.1 36.9
Equity 269.3 212.9 220.5
Debt-equity ratio, times
Ξ
0.2 0.3 0.2
Income per employee
Operating income (calculated to full year) 263.3 176.2 233.1
Number of employees, (average for the period) $0$ 74 82 98
Income per employee 3.6 2.1 2.4

$^{\rm D}$ The average of employees for the period is an approximation where a calculation is made by taking the average of the number of

employees at closing balance and opening balance respectively during the period. The exact calculation is only made for the Company's annual report.

DEFINITIONS OF KEY FIGURES 1)

RETURN ON EQUITY (ROE)

Profit for the period as % of average equity.

Return on equity is a measurement that the Company considers important for an investor who wants to be able to compare their investment with alternative investments.

RETURN ON TOTAL CAPITAL (ROTC)

Profits after net financial items with a reversal of financial expenses, as % of average total assets.

Return on total capital is a measurement that the Company considers important for an investor who wants to see how efficiently the use of total capital in the Company is used and what return it produces.

RETURN ON CAPITAL EMPLOYED (ROCE)

Operating profit (EBIT) plus finance income as % of average capital employed. The capital employed is defined as the total assets less non-interest-bearing liabilities including deferred taxes.

Return on capital employed is a measure that the Company considers important for investors who want to understand earnings generation in relation to capital employed.

EQUITY PER SHARE

Equity in relation to the number of shares on the balance sheet day.

The Company regards the key financial figure equity per share as relevant to investors since it describes the amount of capital (equity) belonging to the shareholders of the Company.

INCOME PER EMPLOYEE

Operating income divided by the number of employees (annualised average of full-time equivalents).

The Company regards income per employee as a relevant measure for investors who want to understand how effectively the Company is using its human capital.

CASH FLOW PER SHARE

Operating cash flow divided by the average number of shares.

The Company regards cash flow per share as relevant to investors since it describes the amount of cash flow directly attributable to the shareholders of the Company.

QUICK RATIO

Current assets excluding inventories but including granted unutilised lines of credit, divided by current liabilities.

The Company regards the quick ratio (cash liquidity) as important for creditors who want to understand the Company's short-term ability to pay.

EARNINGS PER SHARE (EPS)

Financial measure (key figure) according to IFRS

Profit for the period divided by the average number of shares.

INTEREST COVERAGE RATIO

Profit after net financial items with reversal of financial expenses divided by finance costs.

The coverage ratio is a key figure that shows how much the result can decrease without risking interest payments. The Company regards the key financial figures as relevant for investors who want to assess the Company's financial resilience.

OPERATING PROFIT (FRIT)

Operating profit before financial items and taxes.

The Company considers that the key financial figure operating profit (EBIT) is relevant for investors who want to understand the Company's financial results without the influence of how the business operations are financed.

OPERATING PROFIT EXCL. DEPRECIATION AND AMORTISATION (EBITDA)

Operating profit before financial items and taxes (EBIT) with reversal of depreciation and amortization of tangible and intangible fixed assets

The Company considers that the key financial figure operating profit excluding depreciation and amortisation (EBITDA) is relevant for investors who want to understand the Company's financial results without the influence of how the business operations are financed or from what depreciation principles the Company has for its investments.

OPERATING MARGIN

Operating profit (EBIT) as % of net sales.

The Company regards the operating margin (operating profit margin) as a relevant key figure for investors who want to understand the extent of the revenue left over to cover interest, tax and profit.

DEBT-EQUITY RATIO

Interest-bearing liabilities divided by equity.

The debt-to-equity ratio shows the relationship between the borrowings (total debt) and equity and thus the leverage effect of the borrowings. The Company regards this key financial figure as relevant for investors' assessment of the financial strength of the Company.

EQUITY RATIO

Equity as % of the total assets.

The equity ratio is a measure that the Company considers important for creditors/lenders who want to understand the Company's long-term ability to pay.

PROFIT MARGIN

Profit after financial items as % of net sales.

The Company regards the profit margin as relevant to investors because it shows the amount of revenue remaining when all costs excluding tax are covered, and thus compares the profit with the scope of the Company's activities.

1) A description of industry/company-specific words can be found on page 90 of the Company's Annual Report for 2021.

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