AI assistant
Husqvarna — Interim / Quarterly Report 2020
Feb 3, 2021
2926_10-k_2021-02-03_c13afb86-adad-4fb8-ac03-86b2dc90b9f5.pdf
Interim / Quarterly Report
Open in viewerOpens in your device viewer
YEAR-END REPORT JANUARY - DECEMBER 2020 Q4
A successful year
Fourth quarter 2020
- Net sales increased by 4% to SEK 6,683m (6,408), or by 13% when adjusted for changes in exchange rates. (Exits of Consumer Brands business were completed in Q3).
- Operating income was SEK -944m (-493). Excluding items affecting comparability, operating income amounted to SEK -129m (-310).
- Items affecting comparability amounted to SEK -815m (-183) and relate to the supply chain efficiency measures announced in Q3 2020, see page 4 and 16.
- Earnings per share after dilution amounted to SEK -1.26 (-0.67).
- The Construction Division acquired Blastrac, a leading provider of complementing surface preparation technologies.
- The Husqvarna Division announced CEORA, an autonomous professional turf care solution for grass areas up to 50 000m2 , operating within virtual boundaries.
January – December 2020
- Net sales decreased 1% to SEK 41,943m (42,277) or increased by 6% when adjusted for exits of Consumer Brands business and changes in exchange rates.
- Operating income was SEK 3,669m (3,690). Excluding items affecting comparability, operating income amounted to SEK 4,484 (3,915) representing a margin of 10.7% (9.3).
- Items affecting comparability amounted to SEK -815m (-225) and relate to the supply chain efficiency measures, see page 4 and 16.
- Earnings per share after dilution amounted to SEK 4.35 (4.42).
- Direct operating cash flow* was SEK 6,071m (3,849).
- The Board of Directors will propose a dividend for 2020 of SEK 2.40 per share (2.25) to the AGM.
| Financial | summary |
|---|---|
| ----------- | --------- |
| Q4 | Q4 | Jan-Dec | Jan-Dec | |||
|---|---|---|---|---|---|---|
| Group, SEKm | 2020 | 2019 | ∆% | 2020 | 2019 | ∆% |
| Net sales | 6,683 | 6,408 | 4 | 41,943 | 42,277 | -1 |
| Currency adjusted change*, % | 13 | -5 | - | 0 | -2 | - |
| Operating income (EBIT) | -944 | -493 | -92 | 3,669 | 3,690 | -1 |
| Operating margin, % | -14.1 | -7.7 | - | 8.7 | 8.7 | - |
| Operating income excl. items affecting comparability* | -129 | -310 | 58 | 4,484 | 3,915 | 15 |
| Operating margin excl. items affecting comparability* | -1.9 | -4.8 | - | 10.7 | 9.3 | - |
| Income for the period | -718 | -387 | -86 | 2,495 | 2,528 | -1 |
| Earnings per share after dilution, SEK | -1.26 | -0.67 | -88 | 4.35 | 4.42 | -2 |
| Net sales, Divisions | ||||||
| Husqvarna | 4,496 | 4,108 | 9 | 26,607 | 27,506 | -3 |
| Gardena | 761 | 710 | 7 | 9,427 | 8,343 | 13 |
| Construction | 1,403 | 1,551 | -10 | 5,844 | 6,340 | -8 |
| Operating income, Divisions | ||||||
| Husqvarna | -614 | -225 | -172 | 1,979 | 2,260 | -12 |
| Excl. items affecting comparability* | 89 | -100 | n/a | 2,682 | 2,427 | 11 |
| Gardena | -294 | -348 | 15 | 1,432 | 847 | 69 |
| Excl. items affecting comparability* | -294 | -348 | 16 | 1,432 | 847 | 69 |
| Construction | 33 | 106 | -69 | 541 | 779 | -31 |
| Excl. items affecting comparability* | 125 | 163 | -23 | 633 | 836 | -24 |
*Alternative Performance Measure, refer to "Definitions".
Strong results despite a challenging year
"We achieved a continued strong sales growth in our seasonally smallest fourth quarter. The growth was largely driven by our core categories robotics & batterypowered products, handheld products and watering solutions and supported by a prolonged season. This resulted in a net sales growth of 13%*. The development was particularly strong for the Husqvarna and Gardena Divisions, up 19%* and 13%*, respectively, where we strengthened our market positions. The construction industry is severely impacted by the effects of Covid-19 and the net sales of the Construction Division decreased by 2%* in the quarter.
2020 - a successful year
Our primary focus during 2020 has been the health and safety of the employees while decisively safeguarding the business continuity. The good performance in the fourth quarter concludes a record year where we, as a result of hard diligent work over several years, have now reached our financial targets, growth, profitability and capital efficiency, despite a volatile and challenging macro environment marked by the Covid-19 pandemic. Group net sales increased by 6%* during 2020 which demonstrates our strong position and agility to adapt to rapid shifts in demand. The growth was also supported by the stay-at-home trend and an extended gardening season.
Overall, we achieved an operating margin of 10.7% for the year, excluding items affecting comparability of SEK -815m (-225), related to the handheld supply chain efficiency measures we announced in Q3. The improved margin was driven by sales growth in all our regions, product mix effects and temporary cost avoidance activities. Direct operating cash flow* increased to SEK 6.1 billion (3.8) for the year. The Board of Directors will propose a dividend of SEK 2.40 (2.25) per share to the AGM for 2020.
Our strategic focus on sustainability has resulted in a reduction of absolute CO2 emissions across the value chain by 32% compared with the base year 2015. As we enter the new phase of Sustainovate 2025, we continue our commitment to contribute to limiting the global warming to 1.5 degrees.
Raised strategic ambitions & investing in the future
As previously announced, we are accelerating our strategic growth investments by 50% annually or SEK 250m and focus on innovative, sustainable products and solutions. We are increasing our
investments in R&D, production, and go-to-market capabilities for our core categories. One example is CEORA, our latest robotic lawn mowing platform for large, commercial turf areas operating within virtual boundaries. With CEORA, we aim to transform professional green landscaping with an automated, cost-efficient, and sustainable solution. Another example is stepping up our efforts pertaining to digital services, where in 2020 we passed the milestone of one million connected customers on our digital platforms.
In conclusion, we delivered a strong fourth quarter resulting in a record year, achieving our financial targets and strengthened our market positions. I would like to sincerely thank our team around the world for tremendous efforts and commitment during the year. With the global uncertainty of the Covid-19 situation, we are well prepared to adapt to fluctuations in demand and focus to protect the health and safety of our employees and business partners. We will continue to accelerate our strategy to further strengthen our market positions and technology leadership."
*Net sales is adjusted for changes in exchange rates, and for the Husqvarna and Gardena Divisions', exits of the Consumer Brands business.
Henric Andersson, President & CEO
Financial Performance
Financial targets achieved 2020
In 2020, all financial targets; growth, operating margin and capital efficiency were achieved.
| Sales growth | Market +2ppts | +6%* | |||
|---|---|---|---|---|---|
| Operating margin | >10% | 10.7%* | |||
| Capital efficiency | ≤25% | 24.4% | |||
| *Net sales is adjusted for changes in exchange rates and exits of Consumer Brands business and |
operating margin excluding items affecting comparability.
Fourth quarter
Net sales
Net sales for the fourth quarter increased by 4% to SEK 6,683m (6,408) or by 13% when adjusted for changes in exchange rates. The growth was driven by strong performance and good market development, supported by a prolonged gardening season. The market for the Construction division was weaker and its net sales declined in the quarter.
Operating income
Operating income for the fourth quarter was SEK -944m (-493). Excluding items affecting comparability, operating income improved to SEK -129m (-310), driven by the growth in net sales, a favorable product mix and cost avoidance activities. Items affecting comparability amounted to SEK -815m (-183). Changes in exchange rates contributed negatively with approximately SEK 40m compared to last year.
Financial items net
Financial items net amounted to SEK -74m (-131). The decrease was mainly related to lower interest rates and lower debt levels denominated in USD.
Income after financial items
Income after financial items amounted to SEK -1,018m (-624).
Taxes
Income tax amounted to SEK 301m (237).
Earnings per share
Income for the period attributable to equity holders of the Parent Company amounted to SEK -719m (-388),
corresponding to SEK -1.26 (-0.67) per share after dilution.
January - December
Net sales
Net sales for January - December amounted to SEK 41,943m (42,277). Net sales increased by 6% when adjusted for exit of Consumer Brands business and changes in exchange rates. Due to the Covid-19 situation the start of the gardening season was weak. When markets gradually reopened, demand accelerated quickly, as consumers showed a high interest in lawn and garden products. Husqvarna Group was quick to respond and strengthened its market positions during the year. LTM Metric Finanical target Achievement 2020
Operating income
Operating income for January - December was SEK 3,669m (3,690). Excluding items affecting comparability operating income increased 15% to SEK 4,484m (3,915). The increase was primarily related to higher net sales, favorable product mix and cost avoidance activities. Items affecting comparability amounted to SEK -815m (-225). Changes in exchange rates contributed negatively with approximately SEK 75m compared to last year.
Financial items net
Financial items net amounted to SEK -339m (-568). The decrease is mainly related to lower interest rates and lower debt levels denominated in USD.
Income after financial items
Income after financial items amounted to SEK 3,330m (3,122).
Taxes
Income tax amounted to SEK -835m (-594). The effective tax rate for the year was 25% (19).
Earnings per share
Income for the period attributable to equity holders of the Parent Company amounted to SEK 2,494m (2,527), corresponding to SEK 4.35 (4.42) per share after dilution.
3 (20)
Operating cash flow
Operating cash flow for January - December increased to a record SEK 6,087m (2,676) and direct operating cash flow* increased to SEK 6,071m (3,849). The increase was related to higher cash flow from operations and positive effects from changes in working capital.
Due to the seasonal build-up of working capital, operating cash flow is normally negative in the first quarter (this year mitigated by exits of Consumer Brands business), followed by positive cash flow in the second and third quarters, while cash flow in the fourth quarter is usually negatively impacted by the preseason production for the next year.
Financial position
Group equity as of December 31, 2020, excluding noncontrolling interests, decreased to SEK 17,059m (17,281), corresponding to SEK 29.8 (30.2) per share after dilution.
Net debt decreased to SEK 6,493m (11,315). The decrease was mainly related to strong operating cash flow. The net pension liability increased to SEK 2,483m (2,427). Other interest-bearing liabilities decreased to SEK 11,437m (11,786) and liquid funds and other interest-bearing assets increased to SEK 7,426m (2,898).
The Group has long-term unutilized revolving credit facilities amounting to SEK 5bn. The net debt/EBITDA ratio, excluding items affecting comparability*, decreased to 1.2 (1.9). The equity/assets ratio was 39 (41).
Effects of Covid-19
The Covid-19 pandemic continues to affect the world and the situation is still uncertain. Currently, all manufacturing and warehouse sites are in operation
adhering to health and safety restrictions. The Group's primary focus during this situation has been the health and safety of the employees while decisively safeguarding the business continuity as well as longterm operational resilience. Given the uncertainty with the development of the pandemic and the effect on our business, the situation is closely monitored, and further measures are ready to be initiated should the situation change.
Accelerated growth initiatives and increased competitiveness in petrol supply chain
The Group is accelerating strategic investments in sustainable solutions with strong long-term growth potential. The strategic growth initiatives include R&D, production and go-to-market capabilities for key categories such as robotics, battery and watering solutions including an increased focus on solutions for the professional segments. At the same time the overall competitiveness is further improved in the petrol supply chain by streamlining and reducing fixed costs within component manufacturing, increasing the level of automation in the factories and by reallocating production volumes among the factories, bringing final assembly closer to the customers.
These steps will reduce the global workforce by approximately 350 positions and result in annual savings of around SEK 500m, fully effective in 2023, whereof SEK 250m will be reinvested annually into accelerated growth initiatives resulting in net savings of SEK 250m on a yearly basis. The associated one-off costs are estimated to SEK 880m (of which SEK 500m are cash items) where SEK 815m was charged to the result in the fourth quarter of 2020. Overall, the Group is well-positioned to accelerate investments in sustainable growth areas to continue to reduce carbon footprint, cater to changing customer needs and deliver value to all stakeholders.
Financial summary
| SEKm | Q4 2020 |
Q4 2019 |
∆% | Jan-Dec 2020 |
Jan-Dec 2019 |
∆% |
|---|---|---|---|---|---|---|
| Net sales | 4,496 | 4,108 | 9 | 26,607 | 27,506 | -3 |
| Currency adjusted change*, % | 19 | -9 | - | -2 | -4 | - |
| Operating income | -614 | -225 | -172 | 1,979 | 2,260 | -12 |
| Operating margin, % | -13.6 | -5.5 | - | 7.4 | 8.2 | - |
| Operating income excl. items affecting comparability* | 89 | -100 | n/a | 2,682 | 2,427 | 11 |
| Operating margin excl. items affecting comparability* | 2.0 | -2.4 | - | 10.1 | 8.8 | - |
* Alternative Performance Measure, refer to "Definitions".
Fourth quarter
Net sales increased by 9% to SEK 4,496m (4,108) or by 19% when adjusted for changes in exchange rates. The growth was strong in all key regions and the division strengthened its market positions, particularly for robotic lawnmowers, battery-powered products as well as handheld products. New innovations as well as increased focus on aftermarket & accessories contributed to the strong growth.
Operating income amounted to SEK -614m (-225). Excluding items affecting comparability operating income improved by SEK 189m to SEK 89m (-100) and items affecting comparability, related to the previously announced supply chain efficiencies, amounted to SEK -703m (-125). The improvement was related to net sales growth, favorable product mix and cost avoidance activities. Changes in exchange rates had a negative impact of approximately SEK 20m.
January – December
Net sales decreased by 3% to SEK 26,607m (27,506) or by 2% when adjusted for changes in exchange rates. Net sales increased by 5% when adjusted for exits of Consumer Brands business and changes in exchange rates. Due to the Covid-19 situation and related lockdowns, the initial start of the season was weak, but improved rapidly as markets reopened. Good weather conditions and the stay-at-home trend supported a prolonged gardening season.
Operating income amounted to SEK 1,979m (2,260). Excluding items affecting
comparability operating income increased 11% to SEK 2,682m (2,427) and the operating margin increased by 1.3 percentage points to 10.1% (8.8). Items affecting comparability, related to the previously announced supply chain efficiencies, amounted to SEK -703m (-167).The margin was positively impacted by a favorable product mix, higher volumes and cost avoidance activities. Changes in exchange rates had a negative impact of approximately SEK 20m.
Share of Group net sales, 2020
Share of Group operating income, 2020
Financial summary
| Q4 | Q4 | Jan-Dec | Jan-Dec | |||
|---|---|---|---|---|---|---|
| SEKm | 2020 | 2019 | ∆% | 2020 | 2019 | ∆% |
| Net sales | 761 | 710 | 7 | 9,427 | 8,343 | 13 |
| Currency adjusted change*, % | 13 | -8 | - | 13 | 0 | - |
| Operating income | -294 | -348 | 15 | 1,432 | 847 | 69 |
| Operating margin, % | -38.7 | -49.0 | - | 15.2 | 10.2 | - |
| Operating income excl. items affecting comparability* | -294 | -348 | 16 | 1,432 | 847 | 69 |
| Operating margin excl. items affecting comparability* | -38.7 | -49.0 | - | 15.2 | 10.2 | - |
* Alternative Performance Measure, refer to "Definitions".
Fourth quarter
Net sales increased by 7% to SEK 761m (710) or by 13% when adjusted for changes in exchange rates. The growth was strong, particularly for watering solutions and hand tools, where the Gardena Division strengthened the market positions significantly.
Operating income increased by SEK 54m to SEK -294m (-348). The improvement was driven by the good volume development and a favorable product mix. Changes in exchange rates had a positive impact of approximately SEK 10m.
January – December
Net sales increased by 13% to SEK 9,427m (8,343). Net sales increased by 17% when adjusted for exits of Consumer Brands business and changes in exchange rates. As markets reopened after Covid-19 lockdowns, the demand increased quickly. The growth was strong for all categories with good support from recent product launches and innovations. Good weather conditions and the stay-at-home trend supported a prolonged gardening season.
Operating income increased by 69% to SEK 1,432m (847) and the operating margin increased by 5 percentage points to 15.2% (10.2). Gardena concluded the fifth year of consecutive growth and delivered a record result. The margin improvement was driven by the strong volume growth and a favorable product mix. Changes in exchange rates had a negative impact of approximately SEK 35m.
Share of Group net sales, 2020
Share of Group operating income, 2020
Financial Summary
| Q4 | Q4 | Jan-Dec | Jan-Dec | |||
|---|---|---|---|---|---|---|
| SEKm | 2020 | 2019 | ∆% | 2020 | 2019 | ∆% |
| Net sales | 1,403 | 1,551 | -10 | 5,844 | 6,340 | -8 |
| Currency adjusted change*, % | -2 | 7 | - | -6 | 5 | - |
| Operating income | 33 | 106 | -69 | 541 | 779 | -31 |
| Operating margin, % | 2.3 | 6.8 | - | 9.3 | 12.3 | - |
| Operating income excl. items affecting comparability* | 125 | 163 | -23 | 633 | 836 | -24 |
| Operating margin excl. items affecting comparability* | 8.9 | 10.5 | - | 10.8 | 13.2 | - |
* Alternative Performance Measure, refer to "Definitions".
Fourth quarter
Net sales decreased by 10% to SEK 1,403m (1,551) or by 2% when adjusted for changes in exchange rates. Sales developed positively in Europe, whereas sales declined slightly in North America, due to Covid-19 restrictions.
Operating income amounted to SEK 33m (106). Excluding items affecting comparability operating income amounted to SEK 125m (163). The result include acquisition related costs for the Blastrac acquisition. Items affecting comparability, related to the previously announced supply chain efficiencies, amounted to SEK -92m (-57). Changes in exchange rates had a negative impact of approximately SEK 30m, where the division's sales in the US had the largest impact.
January - December
Net sales decreased by 8% to SEK 5,844m (6,340) or by 6% when adjusted for changes in exchange rates. The decline in net sales was primarily due to Covid-19, with lowered demand that affected the markets. Markets recovered towards the end of the second quarter and the third quarter, but was affected from additional restrictions in the fourth quarter.
Operating income amounted to SEK 541m (779). Excluding items affecting comparability operating income amounted to SEK 633m (836). Items affecting comparability, related to the previously announced supply chain efficiencies, amounted to SEK -92m (-57). The operating margin declined 2.4 percentage points to 10.8% (13.2%). The decline was due to lower volumes but partly offset by cost avoidance activities. Changes in exchange rates had a negative impact of approximately SEK 20m.
Share of Group operating income, 2020
Additional information
Conversion of Shares
According to the Company's articles of association, owners of A-shares have the right to have such shares converted to B-shares. Conversion reduces the total number of votes in the Company. 4,520 shares were converted in the fourth quarter. The total number of registered shares in the company at December 31, 2020 amounted to 576,343,778 of which 111,690,460 were A-shares and 464,653,318 were B-shares. The total number of votes amounted to 158,155,791.8.
Parent Company
Net sales for January – December 2020 for the Parent Company, Husqvarna AB, amounted to SEK 18,341m (17,838), of which SEK 14,336m (13,983) referred to sales to Group companies and SEK 4,005m (3,855) to external customers.
Income after financial items decreased to SEK 3,795m (8,512), mainly due to Group internal transactions. Income for the year decreased to SEK 2,643m (8,530). Investments in property, plant and equipment and intangible assets amounted to SEK 1,126m (1,208). Cash and cash equivalents amounted to SEK 4,596m (650) at the end of the year. Undistributed earnings in the Parent Company amounted to SEK 28,627m (27,351).
Important events
Restructuring of the Consumer Brands Division
As communicated in 2018, Husqvarna Group is exiting certain low-margin petrol-powered product segments in the underperforming former Consumer Brands Division and instead focusing on its strengths in premium offerings under the core brands of Husqvarna and Gardena.
As previously communicated, in 2019 the Group exited net sales of SEK 1.4 billion related to Consumer Brands. Exits in 2020 amounted to SEK 2.2 billion and were completed in Q3.
Appointment of New President & CEO
The Board of Directors of Husqvarna AB appointed Henric Andersson to succeed Kai Wärn as the President & CEO of Husqvarna Group and was effective as of April 2, 2020. Previously, Henric Andersson was President of the Construction Division of Husqvarna Group and has been a member of the
Group Management team since 2012. He was born in 1973 and has a Master of Science degree in Industrial Engineering & Management from Linköping Institute of Technology.
Group Management Changes
Karin Falk has been appointed President of the Construction Division and is also a member of Husqvarna Group's management team. Most recently Karin Falk was Senior Vice President Services & Customer Quality at Volvo Trucks and took up her new position within Husqvarna Group on September 1, 2020.
A further step in optimizing and decentralizing the organization was taken in 2020. A new function, Strategy & Innovation was formed, initially headed by Henric Andersson, President & CEO, on an acting basis. Activities within two prior functions, Business Development and Innovation & Technology, were merged into this new function. Activities within the function Operations Development were moved into other functions and/or the divisions. Accordingly, Anders Johanson, Senior Vice President, Innovation & Technology and CTO decided to leave the Group. Brian Belanger left his interim role as Senior Vice President Business Development and continue in his role as Senior Vice President, Legal Affairs. Pavel Hajman continue as Senior Vice President Global Information Services and CIO. The organizational changes were effective from December 1, 2020.
Reinstated dividend
The Board of Directors assessed the Company's financial performance and cash position, as well as general market conditions, and concluded that a reinstatement of the dividend was appropriate. An extra AGM on October 23, 2020 decided on a dividend of SEK 2.25 per share for the fiscal year 2019.
2021 Annual General Meeting
The AGM of Husqvarna AB (publ) will be held on April 14, 2021. Proposals from shareholders on matters to be considered at the Annual General Meeting must be received by Husqvarna AB no later than February 24, 2021.
Acquisition of Blastrac
In December 2020, Husqvarna Group's Construction Division acquired Blastrac, a leading provider of surface preparation technologies for the global construction and remediation industry. The Blastrac product portfolio includes high-quality and efficient solutions for shot blasting, scarifying, scraping, grinding & polishing and dust collection. Blastrac's net sales in 2020 amounted to approximately SEK 600m. The company has 380 employees globally with manufacturing and sales offices in North America, Europe and Asia with sales in more than 80 countries.
Announcement of CEORA
The Husqvarna Division has announced a new robotic solution for commercial turf care management. The new Husqvarna CEORA platform is a autonomous turf care solution for grass areas of up to 50 000 m2 . The high performing, low noise and zero emission Husqvarna CEORA mows autonomously and systematically within virtual boundaries.
Significant events after the quarter
Dividend
The Board of Directors will propose a dividend for 2020 of SEK 2.40 (2.25) per share to the AGM, corresponding to a total dividend payment of SEK 1,374m (1,287) based on the number of outstanding shares at the end of 2020.
Risks and uncertainty factors
A number of factors may affect Husqvarna Group's operations in terms of operational and financial risks.
Operational risks include general economic conditions, as well as trends in consumer and professional spending, particularly in North America and Europe, where the majority of the Group's products are sold. An economic downturn in these markets may have an adverse effect on Group sales and earnings. Shifts in product technology as well as shifts in distribution structure and sales channels could also have a negative impact, as will fluctuations in prices of sourced raw materials and components.
Short term, demand for the Group's products is impacted by weather conditions. The Group's production processes and supply chain are therefore adapted to respond to changes in weather conditions. In the ordinary course of business, the Group is exposed to legal risks such as commercial, product liability and other disputes and provides for them as appropriate.
The situation with Covid-19 can have a significant impact on Husqvarna Group operations, both in terms of difficulties of supply of raw materials and components and also effects on demand of Husqvarna Group's products and solutions.
Financial risks refer primarily to currency exchange rates, interest rates, financing, tax and credit risks. Risk management within Husqvarna Group is regulated by a financial policy established by the Board of Directors.
For further information on risks and uncertainty factors, see the Annual Report 2019 which is available at www.husqvarnagroup.com
Accounting Principles
This year-end report has been prepared in accordance with IAS 34, Interim financial reporting and the Swedish Annual Accounts Act. The financial statement of the Parent Company has been prepared in accordance with the Swedish Annual Accounts Act, chapter 9 and the Swedish Financial Reporting Board's standard RFR 2 Accounting for Legal Entities.
The accounting policies adopted are consistent with those presented in the Annual Report of 2019, which is available at www.husqvarnagroup.com.
Auditors' review report
This year-end report has not been subject to review by the auditors.
Stockholm, February 3, 2021
Henric Andersson President and CEO
Consolidated income statement
| Q4 2020 |
Q4 2019 |
Jan-Dec 2020 |
Jan-Dec 2019 |
|
|---|---|---|---|---|
| SEKm | ||||
| Net sales | 6,683 | 6,408 | 41,943 | 42,277 |
| Cost of goods sold | -5,462 | -4,976 | -29,367 | -29,748 |
| Gross income | 1,221 | 1,432 | 12,576 | 12,529 |
| Gross margin, % | 18.3 | 22.3 | 30.0 | 29.6 |
| Selling expenses | -1,539 | -1,582 | -6,596 | -6,985 |
| Administrative expenses | -630 | -539 | -2,335 | -2,051 |
| Other operating income/expense | 4 | 196 | 23 | 197 |
| Operating income | -944 | -493 | 3,669 | 3,690 |
| Operating margin, % | -14.1 | -7.7 | 8.7 | 8.7 |
| Financial items, net | -74 | -131 | -339 | -568 |
| Income after financial items | -1,018 | -624 | 3,330 | 3,122 |
| Margin, % | -15.2 | -9.7 | 7.9 | 7.4 |
| Income tax | 301 | 237 | -835 | -594 |
| Income for the period | -718 | -387 | 2,495 | 2,528 |
| Income for the period attributable to: | ||||
| Equity holders of the Parent Company | -719 | -388 | 2,494 | 2,527 |
| Non-controlling interest | 1 | 1 | 1 | 1 |
| Earnings per share: | ||||
| Before dilution, SEK | -1.26 | -0.67 | 4.36 | 4.42 |
| After dilution, SEK | -1.26 | -0.67 | 4.35 | 4.42 |
| Weighted average number of shares outstanding: | ||||
| Before dilution, millions | 572.6 | 572.2 | 572.4 | 572.0 |
| After dilution, millions | 572.6 | 572.2 | 572.9 | 572.2 |
Consolidated comprehensive income statement
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| SEKm | 2020 | 2019 | 2020 | 2019 |
| Income for the period | -718 | -387 | 2,495 | 2,528 |
| Other comprehensive income | ||||
| Items that will not be reclassified to the income statement: | ||||
| Remeasurements on defined benefit pension plans, net of tax | 97 | 49 | -27 | -302 |
| Total items that will not be reclassified to the income statement, net of tax | 97 | 49 | -27 | -302 |
| Items that may be reclassified to the income statement: | ||||
| Translation differences | -1,606 | -845 | -2,347 | 916 |
| Net investment hedge, net of tax | 605 | 908 | -525 | |
| Cash flow hedges, net of tax | 76 | 86 | 23 | -79 |
| Total items that may be reclassified to the income statement, net of tax | -803 | -154 | -1,416 | 312 |
| Other comprehensive income, net of tax | -706 | -105 | -1,443 | 10 |
| Total comprehensive income for the period | -1,424 | -492 | 1,051 | 2,538 |
| Total comprehensive income attributable to: | ||||
| Equity holders of the Parent Company | -1,425 | -492 | 1,050 | 2,537 |
| Non-controlling interest | 1 | 0 | 1 | 1 |
Consolidated balance sheet
| Dec 31 | Dec 31 | |
|---|---|---|
| SEKm | 2020 | 2019 |
| Assets | ||
| Property, plant and equipment | 6,324 | 6,794 |
| Right of use assets | 1,212 | 1,585 |
| Goodwill | 6,905 | 7,338 |
| Other intangible assets | 5,639 | 5,629 |
| Investments in associated companies | 44 | 33 |
| Other non-current assets | 570 | 670 |
| Deferred tax assets | 1,576 | 1,690 |
| Total non-current assets | 22,269 | 23,739 |
| Inventories | 9,734 | 10,858 |
| Trade receivables | 3,259 | 3,620 |
| Derivatives | 929 | 592 |
| Tax receivables | 53 | 250 |
| Other current assets | 1,122 | 1,011 |
| Cash and cash equivalents | 6,151 | 1,911 |
| Total current assets | 21,248 | 18,242 |
| Total assets | 43,517 | 41,981 |
| Equity and liabilities | ||
| Equity attributable to equity holders of the Parent Company | 17,059 | 17,281 |
| Non-controlling interests | 3 | 2 |
| Total equity | 17,062 | 17,283 |
| Borrowings | 6,683 | 7,047 |
| Lease liabilities | 991 | 1,304 |
| Derivatives | 85 | 55 |
| Deferred tax liabilities | 1,497 | 1,732 |
| Provisions for pensions and other post-employment benefits | 2,637 | 2,622 |
| Other provisions | 588 | 610 |
| Total non-current liabilities | 12,480 | 13,370 |
| Trade payables | 4,815 | 4,099 |
| Tax liabilities | 1,006 | 269 |
| Other liabilities | 3,413 | 2,995 |
| Borrowings | 2,853 | 2,694 |
| Lease liabilities | 376 | 457 |
| Derivatives | 449 | 229 |
| Other provisions | 1,064 | 585 |
| Total current liabilities | 13,976 | 11,328 |
| Total equity and liabilities | 43,517 | 41,981 |
Consolidated cash flow statement
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| SEKm | 2020 | 2019 | 2020 | 2019 |
| Cash flow from operations | ||||
| Operating income | -944 | -493 | 3,669 | 3,690 |
| Non cash items | 1,247 | 627 | 3,344 | 2,359 |
| Cash items | ||||
| Paid restructuring expenses | -90 | -42 | -244 | -272 |
| Net financial items, received/paid | -86 | -102 | -327 | -490 |
| Taxes paid | 105 | -60 | -291 | -811 |
| Cash flow from operations, excluding change in | ||||
| operating assets and liabilities | 232 | -70 | 6,150 | 4,476 |
| Operating assets and liabilities | ||||
| Change in inventories | -2,279 | -1,022 | 278 | 627 |
| Change in trade receivables | 1,238 | 878 | 55 | 114 |
| Change in trade payables | 1,092 | 704 | 1,014 | -656 |
| Change in other operating assets/liabilities | -567 | -371 | 584 | 347 |
| Cash flow from operating assets and liabilities | -516 | 189 | 1,931 | 432 |
| Cash flow from operations | -284 | 119 | 8,081 | 4,908 |
| Investments | ||||
| Acquisitions and divestments of subsidiaries/operations and divestments of property, plant | ||||
| and equipment | -409 | 325 | -399 | 349 |
| Investments in property, plant and equipment and intangible assets | -689 | -711 | -1,994 | -2,232 |
| Investments and divestments of financial assets | -4 | -88 | -2 | -56 |
| Cash flow from investments | -1,102 | -474 | -2,395 | -1,939 |
| Cash flow from operations and investments | -1,386 | -355 | 5,686 | 2,969 |
| Financing | ||||
| Dividend paid to shareholders | -1,288 | -859 | -1,288 | -1,287 |
| Dividend paid to non-controlling interests | - | - | - | -1 |
| Other financing activities | -170 | 1,540 | 5 | -1,159 |
| Cash flow from financing | -1,458 | 681 | -1,284 | -2,447 |
| Total cash flow | -2,844 | 326 | 4,403 | 522 |
| Cash and cash equivalents at the beginning of the period | 9,064 | 1,623 | 1,911 | 1,346 |
| Exchange rate differences referring to cash and cash equivalents | -69 | -38 | -162 | 43 |
| Cash and cash equivalents at the end of the period | 6,151 | 1,911 | 6,151 | 1,911 |
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
| Operating cash flow, SEKm | 2020 | 2019 | 2020 | 2019 |
| Cash flow from operations | ||||
| Investments in property, plant and equipment and intangible assets | -284 -689 |
119 -711 |
8,081 -1,994 |
4,908 -2,232 |
| Operating cash flow | ||||
| -973 | -592 | 6,087 | 2,676 | |
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
| Direct operating cash flow, SEKm | 2020 | 2019 | 2020 | 2019 |
| EBITDA excl. items affecting comparability | ||||
| Change in inventories | 453 -2,279 |
229 -1,022 |
6,718 278 |
5,996 627 |
| Change in trade receivables | 1,238 | 878 | 55 | 114 |
| Change in trade payables | 1,092 | 704 | 1,014 | -656 |
| Investments in property, plant and equipment and intangible assets | -689 | -711 | -1,994 | -2,232 |
| Direct operating cash flow | -185 | 78 | 6,071 | 3,849 |
Key performance indicators
Income statement
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| EBITDA, SEKm* | 2020 | 2019 | 2020 | 2019 |
| Operating income | -944 | -493 | 3,669 | 3,690 |
| Reversal of depreciation, amortization and impairment | 885 | 547 | 2,537 | 2,089 |
| EBITDA* | -59 | 54 | 6,206 | 5,779 |
| Excl. items affecting comparability* | 453 | 229 | 6,718 | 5,996 |
| EBITDA margin, % | -0.9 | 0.8 | 14.8 | 13.7 |
| Excl. items affecting comparability* | 6.8 | 3.6 | 16.0 | 14.2 |
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
| Key data, SEKm | 2020 | 2019 | 2020 | 2019 |
| Net sales growth, % | 4 | -1 | -1 | 3 |
| Operating income | -944 | -493 | 3,669 | 3,690 |
| Operating margin, % | -14.1 | -7.7 | 8.7 | 8.7 |
| Operating income excl. items affecting comparability* | -129 | -310 | 4,484 | 3,915 |
Operating margin excl. items affecting comparability* -1.9 -4.8 10.7 9.3
Average number of employees 12,547 12,051 12,374 12,708
* Alternative Performance Measure, refer to "Definitions".
Balance sheet
| Dec 31 | Dec 31 | |
|---|---|---|
| Key data, SEKm | 2020 | 2019 |
| Operating working capital | 8,179 | 10,379 |
| Operating working capital / net sales*, % | 24.4 | 27.3 |
| Return on capital employed, % | 13.3 | 12.9 |
| Excl. items affecting comparability*, % | 15.7 | 14.1 |
| Return on equity, % | 13.5 | 14.7 |
| Excl. items affecting comparability*, % | 16.8 | 15.5 |
| Capital turn-over rate, times | 1.6 | 1.5 |
| Equity/assets ratio, % | 39 | 41 |
| Equity per share after dilution, SEK | 29.8 | 30.2 |
| Dec 31 | Dec 31 | |
|---|---|---|
| Net debt, SEKm* | 2020 | 2019 |
| Net pension liability | 2,483 | 2,427 |
| Other interest-bearing liabilities | 11,437 | 11,786 |
| Less: Liquid funds and other interest-bearing assets | -7,426 | -2,898 |
| Net debt* | 6,493 | 11,315 |
| Net debt/equity ratio | 0.38 | 0.65 |
| Net debt/EBITDA excl. Items affecting comparability* | 1.2 | 1.9 |
* Alternative Performance Measure, refer to "Definitions".
Change in Group equity
| Attributable to equity | |||
|---|---|---|---|
| holders of the | Non-controlling | ||
| SEKm | Parent Company | interests | Total equity |
| Opening balance January 1, 2019 | 16,007 | 2 | 16,009 |
| Share-based payment | 24 | - | 24 |
| Dividend | -1,287 | -1 | -1,288 |
| Total comprehensive income | 2,537 | 1 | 2,538 |
| Closing balance December 31, 2019 | 17,281 | 2 | 17,283 |
| Opening balance January 1, 2020 | 17,281 | 2 | 17,283 |
| Share-based payment | 17 | - | 17 |
| Dividend | -1,288 | - | -1,288 |
| Total comprehensive income | 1,050 | 1 | 1,051 |
| Closing balance December 31, 2020 | 17,059 | 3 | 17,062 |
Fair value of financial instruments
The Group's financial instruments carried at fair value are derivatives. Derivatives belong to Level 2 in the fair value hierarchy. Future cash flows have been discounted using current quoted market interest rates and exchange rates for similar instruments. Further information about the accounting principles for financial instruments and methods used for estimating the fair value of the financial instruments are described in note 1 and note 20, respectively, in the Annual Report 2019. The carrying value approximates fair value for all financial instruments except for non-current borrowings, which are shown in the table below. Fair value corresponds to book value in all material aspects.
| Dec 31 2020 | Dec 31 2019 | |||
|---|---|---|---|---|
| Book | Fair | Book | Fair | |
| SEKm | value | value | value | value |
| Non-current borrowings | ||||
| Loans | 6,683 | 6,755 | 7,046 | 6,966 |
Net sales and income by quarter
| 2020 | 2019 | |||||||
|---|---|---|---|---|---|---|---|---|
| Group, SEKm | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 6,683 | 9,570 | 13,482 | 12,208 | 6,408 | 8,429 | 13,789 | 13,651 |
| Net sales, LTM* | 41,943 | 41,667 | 40,526 | 40,834 | 42,277 | 42,339 | 41,953 | 42,433 |
| Operating income | -944 | 997 | 2,191 | 1,424 | -493 | 414 | 2,125 | 1,644 |
| Operating margin, % | -14.1 | 10.4 | 16.3 | 11.7 | -7.7 | 4.9 | 15.4 | 12.0 |
| Operating income excl. IAC* | -129 | 997 | 2,191 | 1,424 | -310 | 414 | 2,125 | 1,686 |
| Operating margin excl. IAC*, % | -1.9 | 10.4 | 16.3 | 11.7 | -4.8 | 4.9 | 15.4 | 12.3 |
| Operating income, LTM* | 3,669 | 4,119 | 3,536 | 3,470 | 3,690 | 3,079 | 2,542 | 2,341 |
| Operating margin, LTM*, % | 8.7 | 9.9 | 8.7 | 8.5 | 8.7 | 7.3 | 6.1 | 5.5 |
| Operating income, LTM excl. IAC* | 4,484 | 4,302 | 3,719 | 3,653 | 3,915 | 3,943 | 3,755 | 3,553 |
| Operating margin, LTM excl. IAC*, % | 10.7 | 10.3 | 9.2 | 8.9 | 9.3 | 9.3 | 8.9 | 8.4 |
| Income for the period | -718 | 653 | 1,567 | 992 | -387 | 269 | 1,505 | 1,140 |
| Husqvarna, SEKm | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 4,496 | 6,069 | 8,042 | 8,001 | 4,108 | 5,204 | 8,688 | 9,506 |
| Net sales, LTM* | 26,607 | 26,219 | 25,355 | 26,001 | 27,506 | 27,708 | 27,520 | 28,178 |
| Operating income | -614 | 543 | 1,078 | 972 | -225 | 82 | 1,217 | 1,186 |
| Operating margin, % | -13.6 | 8.9 | 13.4 | 12.2 | -5.5 | 1.6 | 14.0 | 12.5 |
| Operating income excl. IAC* | 89 | 543 | 1,078 | 972 | -100 | 82 | 1,217 | 1,228 |
| Operating margin excl. IAC*, % | 2.0 | 8.9 | 13.4 | 12.2 | -2.4 | 1.6 | 14.0 | 12.9 |
| Operating income, LTM | 1,979 | 2,368 | 1,907 | 2,046 | 2,260 | 1,859 | 1,433 | 1,370 |
| Operating margin, LTM*, % | 7.4 | 9.0 | 7.5 | 7.9 | 8.2 | 6.7 | 5.2 | 4.9 |
| Operating income, LTM excl. IAC* | 2,682 | 2,493 | 2,032 | 2,171 | 2,427 | 2,450 | 2,353 | 2,290 |
| Operating margin, LTM excl. IAC*, % | 10.1 | 9.5 | 8.0 | 8.3 | 8.8 | 8.8 | 8.5 | 8.1 |
| Gardena, SEKm | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 761 | 1,948 | 4,011 | 2,708 | 710 | 1,630 | 3,373 | 2,630 |
| Net sales, LTM* | 9,427 | 9,377 | 9,058 | 8,421 | 8,343 | 8,379 | 8,312 | 8,264 |
| Operating income | -294 | 274 | 1,054 | 398 | -348 | 120 | 703 | 372 |
| Operating margin, % | -38.7 | 14.1 | 26.3 | 14.7 | -49.0 | 7.4 | 20.8 | 14.1 |
| Operating income excl. IAC* | -294 | 274 | 1,054 | 398 | -348 | 120 | 703 | 372 |
| Operating margin excl. IAC*, % | -38.7 | 14.1 | 26.3 | 14.7 | -49.0 | 7.4 | 20.8 | 14.1 |
| Operating income, LTM | 1,432 | 1,378 | 1,223 | 872 | 847 | 696 | 641 | 532 |
| Operating margin, LTM*, % | 15.2 | 14.7 | 13.5 | 10.4 | 10.2 | 8.3 | 7.7 | 6.4 |
| Operating income, LTM excl. IAC* | 1,432 | 1,378 | 1,224 | 873 | 847 | 920 | 867 | 758 |
| Operating margin, LTM excl. IAC*, % | 15.2 | 14.7 | 13.5 | 10.4 | 10.2 | 11.0 | 10.4 | 9.2 |
| Construction, SEKm | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 1,403 | 1,541 | 1,412 | 1,487 | 1,551 | 1,575 | 1,720 | 1,494 |
| Net sales, LTM* | 5,844 | 5,992 | 6,025 | 6,332 | 6,340 | 6,187 | 6,059 | 5,928 |
| Operating income | 33 | 236 | 140 | 132 | 106 | 229 | 267 | 177 |
| Operating margin, % | 2.3 | 15.3 | 9.9 | 8.9 | 6.8 | 14.6 | 15.5 | 11.8 |
| Operating income excl. IAC* | 125 | 236 | 140 | 132 | 163 | 229 | 267 | 177 |
| Operating margin excl. IAC*, % | 8.9 | 15.3 | 9.9 | 8.9 | 10.5 | 14.6 | 15.5 | 11.8 |
| Operating income, LTM | 541 | 614 | 608 | 735 | 779 | 744 | 707 | 691 |
| Operating margin, LTM*, % | 9.3 | 10.2 | 10.1 | 11.6 | 12.3 | 12.0 | 11.7 | 11.6 |
| Operating income, LTM excl. IAC* | 633 | 670 | 664 | 792 | 836 | 788 | 752 | 735 |
| Operating margin, LTM excl. IAC*, % | 10.8 | 11.2 | 11.0 | 12.5 | 13.2 | 12.7 | 12.4 | 12.4 |
| Group Common, SEKm | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 23 | 12 | 15 | 13 | 39 | 20 | 8 | 21 |
| Operating income | -69 | -55 | -80 | -78 | -26 | -17 | -62 | -91 |
| Operating income excl. IAC* | -49 | -55 | -80 | -78 | -25 | -17 | -62 | -91 |
*Alternative Performance Measure, refer to "Definitions".
Items affecting comparability
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| SEKm | 2020 | 2019 | 2020 | 2019 |
| Impairment of non-current assets | -303 | -8 | -303 | -8 |
| Write-down of inventory | -98 | -4 | -98 | -4 |
| Other restructuring costs | -414 | -171 | -414 | -213 |
| Total items affecting comparability | -815 | -183 | -815 | -225 |
Classification in the income statement
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| SEKm | 2020 | 2019 | 2020 | 2019 |
| Cost of goods sold | -521 | -75 | -521 | -117 |
| Selling expenses | -82 | -57 | -82 | -57 |
| Administrative expenses | -212 | -51 | -212 | -51 |
| Total items affecting comparability | -815 | -183 | -815 | -225 |
Net assets by segment ¹
| Assets | Liabilities | Net Assets | ||||
|---|---|---|---|---|---|---|
| SEKm | Dec 31 2020 |
Dec 31 2019 |
Dec 31 2020 |
Dec 31 2019 |
Dec 31 2020 |
Dec 31 2019 |
| Husqvarna | 18,155 | 20,080 | 5,727 | 4,709 | 12,427 | 15,371 |
| Gardena | 9,229 | 9,835 | 2,579 | 2,102 | 6,650 | 7,733 |
| Construction | 6,874 | 6,988 | 1,266 | 1,155 | 5,608 | 5,833 |
| Other ² | 1,679 | 1,952 | 2,809 | 2,324 | -1,130 | -372 |
| Total | 35,937 | 38,855 | 12,382 | 10,290 | 23,555 | 28,565 |
¹ Liquid assets, other interest-bearing assets, interest-bearing liabilities and equity are not included in the table above.
² Other includes tax items, associates and common Group services such as Holding, Treasury and Risk Management.
Parent Company
Income statement
| Q4 | Q4 | Jan-Dec | Jan-Dec | |
|---|---|---|---|---|
| SEKm | 2020 | 2019 | 2020 | 2019 |
| Net sales | 4,054 | 3,006 | 18,341 | 17,838 |
| Cost of goods sold | -2,590 | -2,593 | -13,034 | -13,626 |
| Gross income | 1,463 | 413 | 5,307 | 4,212 |
| Selling expense | -348 | -334 | -1,439 | -1,449 |
| Administrative expense | -435 | -372 | -1,308 | -1,308 |
| Other operating income/expense | - | 9 | - | 9 |
| Operating income | 680 | -284 | 2,560 | 1,464 |
| Financial items, net | 876 | 611 | 1,235 | 7,048 |
| Income after financial items | 1,557 | 327 | 3,795 | 8,512 |
| Appropriations | -445 | 155 | -506 | 110 |
| Income before taxes | 1,112 | 482 | 3,290 | 8,622 |
| Tax on profit for the year | -243 | -115 | -647 | -92 |
| Income for the period | 869 | 367 | 2,643 | 8,530 |
Balance sheet
| Dec 31 | Dec 31 | |
|---|---|---|
| SEKm | 2020 | 2019 |
| Non-current assets | 38,099 | 38,226 |
| Current assets | 14,476 | 9,987 |
| Total assets | 52,575 | 48,213 |
| Equity | 31,211 | 29,801 |
| Untaxed reserves | 794 | 794 |
| Provisions | 89 | 101 |
| Non-current liabilities | 6,606 | 6,881 |
| Current liabilities | 13,875 | 10,636 |
| Total equity and liabilities | 52,575 | 48,213 |
Number of shares
| Outstanding A-shares |
Outstanding B-shares |
Repurchased B-shares ¹ |
Total | |
|---|---|---|---|---|
| Number of shares as of December 31, 2019 | 112,015,629 | 460,186,985 | 4,141,164 | 576,343,778 |
| Conversion of A-shares into B-shares | -325,169 | 325,169 | - | - |
| Shares allocated to 2017 LTI-program | - | 375,314 | -375,314 | - |
| Number of shares as of December 31, 2020 | 111,690,460 | 460,887,468 | 3,765,850 | 576,343,778 |
¹ All repurchased B-shares are included in a third party share swap agreement.
Definitions
This report includes financial measures as required by the financial reporting framework applicable to Husqvarna Group, which is based on IFRS. In addition, there are other measures (alternative performance measures) used by management and other stakeholders to analyze trends and performance of the Group's operations that cannot be directly read or derived from the financial statements. Husqvarna stakeholders should not consider these as substitutes, but rather as additions, to the financial reporting measures prepared in accordance with IFRS. Please note that the alternative performance measures as defined, may not be comparable to similarly titled measures used by other companies. Refer below for a list of definitions of all measures and indicators used, referred to and presented in this report.
Computation of average amounts
In computation of key ratios where averages of capital balances are included, the average capital balances are based on the opening balance and all quarter-end closing balances included in the reporting period, i.e five quarters.
Roundings
All items are stated in SEKm and, accordingly, rounding differences can occur.
Growth measures
Net sales adjusted for changes in exchange rates
Change in net sales adjusted for currency translation effects. Net sales are also disclosed adjusted for currency translation effects as Husqvarna Group is a global company generating significant transactions in other currencies than the reporting currency (SEK) and the currency rates have proven to be volatile.
Net sales growth
Change in net sales compared to previous period in percent.
Organic growth
Change in net sales, adjusted for acquisitions, divestments and currency translation effects.
Profitability measures
EBITDA
EBITDA is a measure of earnings before interest, taxes, depreciation, amortization and impairment charges. EBITDA measures Husqvarna Group's
operating performance and the ability to generate cash from operations, without considering the capital structure of the Group or its fiscal environment. For a reconciliation of EBITDA refer to table below the income statement.
EBITDA margin
EBITDA as a percentage of net sales.
Gross margin Gross income as a percentage of net sales.
Last twelve months (LTM)
Last twelve months rolling has been included to assist stakeholders in their analysis of the seasonality that Husqvarna Group's business is exposed to.
Operating margin
Operating income as a percentage of net sales.
Return on capital employed
Operating income plus financial income (last twelve months) as a percentage of average capital employed.
Return on equity
Net income attributable to equity holders of the Parent Company last twelve months as a percentage of average equity attributable to equity holders of the Parent Company.
Share-based measures
Earnings per share, after dilution
Net income attributable to equity holders of the Parent Company divided by the weighted average number of shares outstanding (net of treasury shares), after dilution.
Equity per share, after dilution
Equity attributable to equity holders of the Parent Company divided by the weighted average number of shares outstanding (net of treasury shares), after dilution.
Capital indicators
Capital employed
Total equity and liabilities less non-interest-bearing debt including deferred tax liabilities.
Capital expenditure
Investments in property, plant and equipment, right of use assets and intangible assets.
Interest bearing liabilities
Long-term and short-term borrowings, net pension liability and fair value derivative liabilities.
Liquid funds
Cash and cash equivalents, short-term investments and fair value derivative assets.
Net assets
Total assets excluding liquid funds and interest-bearing assets less operating liabilities, non-interest-bearing provisions and deferred tax liabilities.
Net debt
Net debt describes the Group's gearing and its ability to repay its debts from cash generated from the Group´s ordinary business (see operating cash flow below), if they were all due today. It's also used to analyze how future net interest costs will impact earnings. Net debt is defined as total interest-bearing liabilities plus dividend payable, less liquid funds and interest-bearing assets. For a reconciliation of net debt refer to table below the balance sheet.
Operating working capital
Inventories and trade receivables less trade payables.
Capital measures
Equity/assets ratio
Equity attributable to equity holders of the Parent Company as a percentage of total assets.
Capital turnover rate
Net sales last twelve months divided with average net assets.
Net debt/EBITDA excl. items affecting comparability
Average net debt in relation to EBITDA last twelve months, excluding items affecting comparability.
Net debt/equity ratio
Net debt in relation to total equity.
Operating working capital/net sales
Average operating working capital as a percentage of net sales last twelve months.
Other measures
Direct operating cash flow
Direct operating cash flow is a measure of the cash generated by the Groups operating business. The measure is defined as EBITDA, excluding items affecting comparability, adjusted for change in trade payables, inventory and trade receivables and investments in property, plant and equipment and intangible assets. For a reconciliation of direct operating cash flow refer to the table below the cash flow statement.
Items affecting comparability
To assist in understanding Husqvarna Group's operations, we believe that it is useful to consider certain measures and ratios exclusive of items affecting comparability. Items affecting comparability includes items that are non-recurring, have a significant impact and are considered to be important for understanding the operating performance when comparing results between periods. The items affecting comparability are disclosed in this report. All measures and ratios in this report have been disclosed including items affecting comparability first and then excluding items affecting comparability as a second measure when deemed appropriate.
Operating cash flow
Operating cash flow is a measure of the amount of cash generated by the Group's ordinary business operations. The measure is defined as total cash flow from operations and investments, excluding acquisitions and divestments of subsidiaries/operations, divestments of property plant and equipment and investments/divestments of financial assets. For a reconciliation of operating cash flow refer to table below the cash flow statement.
Telephone Conference
A conference call, hosted by Henric Andersson, President & CEO, and Glen Instone, CFO, will be held at 10:00 CET on February 3, 2021.
To participate, please dial +46 (0) 8 505 583 51 (Sweden) or +44 333 300 9274 (UK) ten minutes prior to the start of the conference. Conference ID: Husqvarna.
The conference call is also available through https://husqvarnagroup.creo.se/210203. A replay will be available later the same day.
Dates for Financial Reports 2021
April 14 Annual General Meeting 2021 April 22 Interim report for January-March July 16 Interim report for January-June October 20 Interim report for January- September
Contacts
Glen Instone, CFO, Senior Vice President, Finance, IR & Communication +46 8 738 90 00
Johan Andersson, Director, Group Corporate Communications and Investor Relations, +46 702 100 451
Husqvarna AB (publ), Box 7454, SE-103 92 Stockholm Regeringsgatan 28, 08-738 90 00, www.husqvarnagroup.com
Reg. Nr: 556000-5331 NASDAQ OMX Stockholm: HUSQ A, HUSQ B
This report contains insider information that Husqvarna AB is required to disclose under the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the contact person set out above, at 07.30 CET on February 3, 2021.
Factors affecting forward-looking statements
This report contains forward-looking statements in the sense referred to in the American Private Securities Litigation Reform Act of 1995. Such statements comprise, among other things, financial goals, goals of future business and financial plans. These statements are based on present expectations and are subject to risks and uncertainties that may give rise to major deviations in the result due to several aspects. These aspects include, among other things: consumer demand and market conditions in the geographical areas and lines of business in which Husqvarna operates, the effects of currency fluctuations, downward pressure on prices due to competition, a material reduction in sales by important distributors, success in developing new products and in marketing, outcome of product responsibility litigation, progress in terms of reaching the goals set for productivity and efficient use of capital, successful identification of growth opportunities and acquisition objects, integration of these into the existing business and successful achievement of goals for making the supply chain more efficient.