Loomis — Interim / Quarterly Report 2020

Feb 3, 2021

Full-Year Report January – December 2020

Q4 2020

• Revenue SEK 4,537 million (5,342). Real growth –7 percent (5), of which organic growth was –9 percent (1).
• Operating income (EBITA)1) SEK 467 million (693) and operating margin 10.3 percent (13.0). Excluding Loomis Pay, the operating margin amounted to 11.0 percent (13.0)
• Income before tax SEK 203 million (552) and income after tax SEK 103 million (407).
• Earnings per share before and after dilution SEK 1.37 (5.42).
• Cash flow from operating activities2) SEK 362 million (325), equivalent to 80 percent (48) of operating income (EBITA)2).
• The ongoing coronavirus pandemic had an overall negative impact on revenue and operating income during the quarter. The significant differences compared to the fourth quarter of 2019 are related to the pandemic.
• Due to the coronavirus pandemic, several restructuring programs are ongoing in Europe to improve efficiency and the operating margin.
• A dividend of SEK 5.50 per share (10.00) for 2019 was paid out in the fourth quarter.
• Successful launch of Loomis Pay, the new platform for digital and cash payments.

Full year 2020

• Revenue SEK 18,813 million (21,044). Real growth –8 percent (5), of which organic growth was –9 percent (2).
• Operating income (EBITA)1) SEK 1,775 million (2,601) and operating margin 9.4 percent (12.4) Excluding Loomis Pay, the operating margin amounted to 9.8 percent (12.4).
• Income before taxes SEK 1,096 million (2,210) and income after taxes SEK 716 million (1,646).
• Earnings per share before and after dilution was SEK 9.52 (21.88).
• Cash flow from operating activities2) SEK 2,218 million (2,057), equivalent to 129 percent (81) of operating income (EBITA)2).
• Overall, the ongoing coronavirus pandemic had a significant negative impact on revenue and operating income for the year.
• In light of the continuing corona pandemic that has delayed the recovery in retail and the hospitality industry, especially in Europe, Loomis´ assessment is that the previously communicated operating margin target, of 12 – 14 percent for 2021, will likely not be achieved. As the market conditions for 2021 are still uncertain, due to the pandemic, Loomis has decided to remove the operating margin target.
• The Board of Directors proposes a dividend of SEK 6.00 per share for 2020 (5.50).

	2020	2019		2020	2019
SEK m	Q4	Q4	Change (%)	Twelve months	Twelve months	Change (%)
Revenue	4,537	5,342	–15.1	18,813	21,044	–10.6
Of which:
Organic growth	–475	71	–8.9	–1,968	443	–9.4
Acquisitions and divestments	82	169	1.5	326	535	1.6
Exchange rate effects	–412	145	–7.7	–589	898	–2.8
Total growth	–805	386	–15.1	–2,231	1,876	–10.6
Operating income (EBITA)1)	467	693	–33	1,775	2,601	–32
Operating margin (EBITA), %1)	10.3	13.0		9.4	12.4
Operating income (EBITA)	250	609	–59	1,304	2,422	–46
Earnings before tax	203	552	–63	1,096	2,210	–50
Profit for the period	103	407	–75	716	1,646	–56
SEK earnings per share, SEK1)	1.37	5.42	–75	9.52	21.88	–56
Tax rate, %	49	26		35	26
Cash flow from operating activities2)	362	325	11	2,218	2,057	8
Cash flow from operating activities as % of operating income (EBITA)2)	80	48		129	81

KEY RATIOS

1) Earnings Before Interest, Taxes and Amortization of acquisition-related intangible fixed assets, acquisition-related costs and revenue, and items affecting comparability. For information on the effects of IFRS 16, see Note 8.

2) Cash flow from operating activities excluding the effects of IFRS 16. The adoption of IFRS 16 has therefore had no net impact on cash flow from operating activities according to Loomis's definition. See also under Definitions on page 26.

An explanation and reconciliation of alternative performance measures can be found on pages 24–25 of this report.

Comments by the President and CEO

Impact of the pandemic

Toward the end of the second quarter and during the third quarter the transmission of the virus in society decreased and Loomis' business gradually recovered. In the fourth quarter the negative effects of the pandemic on our business increased when infection rates rose again. The challenges for society and Loomis are still extensive, but the negative impact of the pandemic on our business was significantly lower in the fourth quarter than in the second quarter when the pandemic broke out. Facing declining revenues, our branches were quick to take action to adapt to lower volumes and this yielded results. The health and safety of our employees is paramount and is also essential in order to maintain a high level of access to our services and personnel. We are carefully following the advice of local public health authorities and international medical organizations, and we have succeeded in keeping the virus out of our workplaces and in our contacts with the external environment.

There have been rumors that cash is a source of transmission of infection, but I would like to stress that this is not the case. Several central banks have engaged medical experts who have issued statements disputing claims that the virus is transferred via cash. WHO has also clearly stated that it has never communicated that cash presents a significant infection risk. On our website, www.loomis.com, we provide information and guidance about cash and virus transmission.

Loomis Pay

The launch of Loomis Pay in Denmark began in October. It has attracted a lot of interest and has been well received. Numerous agreements have been signed – in spite of the pandemic – and we have noted that Loomis Pay also has a positive impact on customer interest in cash management, as it facilitates the cash management process. Loomis Pay represents a major step toward achieving our goal of advancing up the value chain. Loomis Pay is a complete payment platform that is particularly well-suited for retailers and restaurants, and is initially aimed at small and medium sized merchants. The solutio handles all types of payments – cash, card and other digital options, regardless of whether payment is made in a physical store or online. The launch in Sweden will begin in the first quarter of 2021. More and more markets will subsequently be able to enjoy the benefits of Loomis Pay. The target for the first stage is for the service to reach net sales in excess of SEK 3 billion within five years, with an attractive operating margin. We expect Loomis Pay to generate positive operating income (EBITA) in 2023.

We will benefit greatly from the comprehensive network we already have in place when we reach out to our existing and future customers to roll out Loomis Pay. If you are interested in learning more about Loomis Pay, please see the press release issued on September 9 and the presentation available on our website, www.loomis. com. Loomis Pay will be reported in a separate segment from Q1 2021.

Recent developments

In the fourth quarter the Group's real growth amounted to –7 percent (5), of which organic growth was –9 percent (1). The Group's operating margin (EBITA %) amounted to 10.3 percent (13.0) in the fourth quarter. The operating margin was mainly affected negatively by the ongoing pandemic. Excluding Loomis pay, the operating margin amounted to 11.0 percent (13.0).

Just as in the second and third quarters, the pandemic's impact on our US operations was significantly lower than on our

Revenue, SEK billion

Operating margin (EBITA), %

Annual dividend, %

*Calculated based on dividend proposal for AGM 2021.

European operations. This is mainly due to the structure of our customer portfolios. In the USA a larger percentage of our revenue is based on fixed monthly fees. Fixed revenue from, for example, SafePoint and financial institutions is significantly higher in the USA than in Europe. Revenue from our SafePoint solution is developing well. In November we signed the single largest contract since the concept was launched more than a decade ago. The order with EG-US is for approximately 1,700 units to be installed in 2021.

Despite the challenges posed by the pandemic, we are continuing to increase our operating margin within our US operations. The operating margin amounted to 17.5 percent (15.8) in the fourth quarter. Multiple factors are contributing to this positive development, but I would in particular like to point to a more profitable customer portfolio, higher revenue from SafePoint and efficiency improvement programs at our branches. In the fourth quarter we were also able to report positive effects from our long-term program to lower costs through preventive measures relating to accidents and the health of our employees.

The increased infection rates had a negative impact on our European segment in

the fourth quarter. Volumes in our markets recovered gradually in the third quarter but fell back in the fourth quarter when tougher restrictions were reintroduced in the European countries. The activities we have conducted on the cost side have gradually yielded good results. The restructuring programs initiated in several European markets in the second and third quarters are progressing according to plan.

The most significant restructuring is taking place within our UK operations. The total cost of all of these programs will be around SEK 160 million, of this, SEK 114 million was expensed in the fourth quarter of 2020. The majority of the program activities took place in 2020 and only a few remain to be implemented in 2021. We expect to conclude the ongoing programs in the second quarter of 2021. The actions we are taking will help to improve efficiency and operating margins. In December we concluded the acquisition of Automatia in Finland and work on the integration began immediately. This acquisition will allow us to gradually advance our position in the European ATM market. Integration of acquired operations is also under way in Sweden and France and we expect to see positive effects in 2021 in both countries.

Autumn Capital Markets Day

2021 is the final year of the strategy period that began in 2018. New targets for the upcoming strategy period are currently being developed and we intend to present our future ambitions and targets at a Capital Markets Day event in autumn 2021. Hopefully, the negative effects of the pandemic will have subsided by then. We look forward to being able to meet all of our stakeholders in person again.

Our loyal customers and employees

2020 was a different year. The pandemic had a negative impact on our communities and our business. Despite the significant strains placed on us, we succeeded in quickly adapting our processes. Our employees have shown impressive loyalty and initiative. I'm convinced that this, combined with our Group-wide programs, will enable Loomis to come out of this situation stronger and to start growing again as things gradually get back to normal. I would like to express my deep gratitude to all of our employees, customers and other stakeholders for the loyalty and strong commitment you have shown over the past year.

Patrik Andersson President and CEO

The segments

SEGMENT EUROPE – REVENUE, OPERATING INCOME AND NUMBER OF FULL-TIME EMPLOYEES

	2020	2019	2020	2019
SEK m	Q4	Q4	Full year	Full year
Revenue	2,368	2,942	9,788	11,498
Sales growth, %	–19.5	9.6	–14.9	9.4
-of which organic growth, %	–16.6	1.1	–15.4	2.2
-of which acquisitions / divestments, %	2.4	7.1	2.9	5.6
-of which exchange rate effects, %	–5.3	1.3	–2.5	1.6
Real growth, %	–14.2	8.2	–12.4	7.8
Operating income (EBITA)	144	358	588	1,429
Operating margin, %	6.1	12.2	6.0	12.4
Number of full-time employees	13,900	15,300	13,900	15,300

SEGMENT USA – REVENUE, OPERATING INCOME AND NUMBER OF FULL-TIME EMPLOYEES

	2020	2019	2020	2019
SEK m	Q4	Q4	Full year	Full year
Revenue	2,184	2,424	9,098	9,639
Sales growth, %	–9.9	6.1	–5.6	10.6
-of which organic growth, %	0.3	2.3	–2.2	2.8
-of which acquisitions / divestments, %	0.3	–0.9	–0.2	–0.6
-of which exchange rate effects, %	–10.5	4.8	–3.2	8.4
Real growth, %	0.6	1.4	–2.4	2.2
Operating income (EBITA)	382	383	1,425	1,372
Operating margin, %	17.5	15.8	15.7	14.2
Number of full-time employees	9,000	9,700	9,100	9,600

Revenue and earnings

Q4 2020

Group – revenue

Revenue for the quarter amounted to SEK 4,537 million (5,342). Real growth was –7 percent (5), of which organic growth was –9 percent (1). Most of the negative impact on revenue is due to the ongoing pandemic.

Segment Europe – revenue

Revenue for the quarter amounted to SEK 2,368 million (2,942). The real growth of –14 percent (8) was positively affected by revenue attributable to the acquisition of Nokas Värdehantering AB in Sweden in June 2020 and the acquisition of Automatia in Finland, which was concluded on 2 December 2020. Organic growth was –17 percent (1). Just as in the second and third quarters of 2020, the ongoing coronavirus pandemic negatively affected revenue and volumes significantly in important markets such as Spain, France and the UK.

Segment USA – revenue

Revenue amounted to SEK 2,184 million (2,424) and real growth was 1 percent (1). Organic growth amounted to 0 percent (2). The negative effects of the spread of the pandemic had significantly less of an impact in the USA than in Europe. This is mainly due to the structure of the customer portfolios. In the USA medium and large retail customers and financial institutions account for a larger share of revenue than in Europe. In addition, in the USA a larger share of revenue than in Europe is not volume-dependent. Fixed revenue from, for example, SafePoint and financial institutions is significantly higher in the USA than in Europe. Revenue for the quarter from SafePoint accounted for 18 percent (15) of the segment's total revenue. The share of revenue from CMS during the quarter amounted to 34 percent (35) of the segment's total revenue.

Group – operating income (EBITA)

The operating income (EBITA) amounted to SEK 467 million (693) and the operating margin was 10.3 percent (13.0). The currency effect on operating income during the quarter was around SEK –61 million.

Segment Europe – operating income (EBITA)

The operating income (EBITA) amounted to SEK 144 million (358) and the operating margin was 6.1 percent (12.2). Just as in the second and third quarters of 2020, the impact of the pandemic on volumes was clearly evident and resulted in a lower operating margin than the corresponding period in 2019. The activities initiated in the second and third quarters of 2020, to adapt costs to lower volumes, have continued to yield results. Comprehensive programs have been launched in several countries, with the most significant restructuring taking place within the UK operations. The program costs are recognized as items affecting comparability and are not included in operating income (EBITA). See the heading "Group - other" below for further

information. Integrations of acquired operations under way in Sweden, France and Finland are progressing according to plan. During the quarter several of Loomis's European companies received government grants, mainly to provide relief for furloughed employees. The total amount received was around SEK 18 million.

Segment USA– operating income (EBITA)

The operating income (EBITA) amounted to SEK 382 million (383) and the operating margin was 17.5 percent (15.8). Many actions are contributing to the positive profitability development. The main factors contributing to the good results are a more profitable customer portfolio, higher revenue from SafePoint and efficiency improvement programs at the branches which have, among other things, reduced the number of overtime hours worked. The operating income was also positively impacted by the long-term program to lower costs through preventive measures relating to accidents and the health of our employees. It has therefore been possible to revalue the provisions in the balance sheet. Excluding these revaluation effects, the operating margin for the quarter amounted to 16.3 percent.

Group – other

The operating income (EBIT) for the quarter amounted to SEK 250 million (609), which includes amortization of acquisitionrelated intangible assets of SEK –28 million (–26), acquisitionrelated costs of SEK –75 million (–57) and items affecting comparability of SEK –114 million (–2). The item "Acquisition-related costs" mainly consists of costs relating to the integration of acquired operations in France and Sweden, and to some extent also in Finland. For 2019, acquisition-related costs included a break-up fee of around SEK –20 million that Loomis was obliged to pay to the seller for the acquisition of Ziemann, which was stopped in 2019 by the German competition authority. The item affecting comparability, of SEK –114 million, relates mainly to restructuring costs within the UK operations. The total cost of all of the European restructuring programs will be approximately SEK 160 million, of this, SEK 114 million was expensed in the fourth quarter this year. The Company expects to conclude the ongoing programs in the second quarter of 2021.

Income before tax of SEK 203 million (552) includes a net financial expense, including a loss on monetary net assets, of SEK –46 million (–57).

The tax expense for the quarter amounted to SEK –100 million (–145), which represents a tax rate of 49 percent (26). In the fourth quarter of 2020 tax was affected by non-deductible acquisition costs and the pre-tax profit was, in absolute terms, lower than normal in countries with a lower tax rate. Earnings per share before and after dilution amounted to SEK 1.37 SEK (5.42).

Revenue and earnings

Full year 2020

Group – revenue

Revenue for the period amounted to SEK 18,813 million (21,044). Real growth was –8 percent (5), of which organic growth was –9 percent (2). Most of the negative impact on revenue is due to the ongoing pandemic.

Segment Europe – revenue

Revenue amounted to SEK 9,788 million (11,498). The real growth of –12 percent (8) was positively affected by revenue attributable to the acquisition of Prosegur Cash's French operations in July 2019, the acquisition of Nokas Värdehantering AB in Sweden in June 2020 and the acquisition of Automatia in Finland in December 2020. Organic growth was –15 percent (2). Business developed well in the first two months of the year, but was negatively affected from March by the ongoing coronavirus pandemic. In May the European operations started to recover and this positive development, compared to the second quarter, continued in the third quarter. The positive trend ended in November when the infection rates started to rise again and restrictions in Europe were intensified.

Segment USA – revenue

Revenue amounted to SEK 9,098 million (9,639) and real growth was –2 percent (2). Organic growth amounted to –2 percent (3). During the first quarter this year Loomis's organic growth was positive, but the negative effects in the rest of 2020, from the ongoing pandemic, resulted in negative organic growth for 2020 as a whole. The negative impact of the pandemic on volumes was, however, significantly lower in the USA than in Europe. This is mainly due to the structure of the customer portfolios. Revenue for the period from SafePoint accounted for around 17 percent (15) of the segment's total revenue.

The share of revenue from CMS for the period amounted to 34 percent (34) of the segment's total revenue.

Group – operating income (EBITA)

The operating income (EBITA) amounted to SEK 1,775 million (2,601) and the operating margin was 9.4 percent (12.4). The currency effect on operating income during the period was around SEK –92 million.

Segment Europe – operating income (EBITA)

The operating income (EBITA) amounted to SEK 588 million (1,429) and the operating margin was 6.0 percent (12.4). The operating margin fell during the period as the impact of the pandemic on volumes in the period March–December was significant. Costsaving activities launched in April started to have an effect in the second half of the second quarter and continued to yield good results for the rest of the year. The acquisition in France in July 2019 had a dilutive effect on the operating margin. During the period several of Loomis's European companies received government grants, mainly to provide relief for furloughed employees.

The total amount received was around SEK 147 million.

Segment USA – operating income (EBITA)

The operating income (EBITA) amounted to SEK 1,425 million (1,372) and the operating margin was 15.7 percent (14.2). The main factors contributing to the improved profitability are a more profitable customer portfolio, higher revenue from SafePoint and efficiency improvement programs at the branches which have, among other things, reduced the number of overtime hours worked.

Group – other

The operating income (EBIT) for the quarter amounted to SEK 1,304 million (2,422), which includes amortization of acquisition-related intangible assets of SEK –109 million (–101), acquisition-related costs of SEK –163 million (–101) and items affecting comparability of SEK –200 million (23). Acquisition-related costs in 2020 are mainly related to acquisitions in France and Sweden. The item affecting comparability of SEK –200 million consists primarily of costs relating to restructuring programs within the European segment and impairment of goodwill in one of the operations within the European segment. The 2019 item of SEK 23 million is largely capital gains on the divestment of the art logistics and storage business.

Income before tax of SEK 1,096 million (2,210) includes a net financial expense, including loss of monetary net assets, of SEK –207 million (–212).

The tax expense for the period amounted to SEK –380 million (–564), which represents a tax rate of 35 percent (26). The tax rate was mainly impacted by the fact that pre-tax profit decreased, in absolute terms, to a greater extent in countries with a lower tax rate. There was also an effect from goodwill impairment in the second quarter and in the fourth quarter from acquisition costs, which are not tax deductible.

Earnings per share before and after dilution amounted to SEK 9.52 SEK (21.88).

Cash flow and investments

January – December 2020

Cash flow from operating activities, excluding effects from IFRS 16, amounted to SEK 2,218 million (2,057), equivalent to 129 percent (81) of operating income (EBITA).

The period's net investments in fixed assets amounted to SEK –986 million (–1,643), which can be compared to depreciation (excluding the effects from IFRS 16) of SEK 1,266 million (1,265). Investments made during the period were mainly in buildings, vehicles, machinery and equipment. Investments in relation to depreciation for the period amounted to 0.8 (1.3).

Capital employed and financial position

Capital employed

The total capital employed as of December 31, 2020 amounted to SEK 15,392 million (16,924 as of December 31, 2019), which represents 82 percent (80) of revenue. Return on capital employed for the January–December 2020 period amounted to 12 percent (15 percent for January – December 2019).

Shareholders' equity and financing

Shareholders' equity decreased in 2020 by SEK 819 million to SEK 8,773 million as of December 31, 2020 (9,592 as of December 31, 2019). The decrease is mainly explained by the translation difference of SEK –1,227 million due to a stronger Swedish currency. The return on shareholders' equity in the January– December 2020 period was 8 percent (17 percent for January– December 2019) and the equity ratio was 35 percent (36 percent as of December 31, 2019).

Net debt amounted to SEK 6,619 million as of June 31, 2020 (7,332 as of December 31, 2019) and net debt/EBITDA amounted to 1.82 (1.65 as of December 31, 2019).

As of December 31, 2020 the total long-term credit facilities amounted to around SEK 8.7 billion. Unutilized credit facilities amounted to around SEK 4.0 billion on December 31, 2020, of which 1.1 billion was used as back-up for outstanding commercial papers. Available liquid funds amounted to around SEK 2.1 billion (see Note 7).

Other events

Significant events January – December 2020

In March 2020, the Board of Directors of Loomis AB decided to withdraw the proposal of a dividend for 2019 of SEK 11 per share and at the same time announced the intention for the final dividend decision to be made at an extraordinary shareholders' meeting later in the year when the consequences of the pandemic could be better assessed. On November 4, the Board communicated that it had conducted a new assessment of the effects of the pandemic and the Company's financial position. The overall assessment of the Board was that there was reason for continued restraint as the pandemic still posed the same risk in society and it was still hard to obtain a full overview of its consequences. Based on this, the Board decided to propose a dividend of SEK 5.50 per share for 2019, equivalent to around SEK 414 million. The extraordinary shareholders' meeting held on December 10, 2020 voted in favor of the Board's proposed dividend. As a precautionary measure to decrease the risk of virus transmission, the Board decided not to convene a physical extraordinary meeting but instead to allow shareholders to exercise their voting rights through a mail-in vote.

The Annual General Meeting on May 6, 2020 voted in favor of the Board's proposal to introduce an incentive scheme (Incentive Scheme 2020). Similar to the previous year's incentive scheme (Incentive Scheme 2019), Incentive Scheme 2020 involves two thirds of the variable remuneration being paid out in cash the year after it is earned. The remaining one third will be in the form of shares in Loomis AB to be allotted to the participants at the beginning of 2022. The allotment of shares is contingent upon the employee still being employed by the Loomis Group on the last day of February 2022, other than in cases where the employee has left his/her position due to retirement, death or a long-term illness, in which case the individual will retain the right to receive bonus shares. The principle of performance measurement and other general principles being applied in Incentive Scheme 2019 will continue to apply. Loomis AB will not issue any new shares or similar instruments for Incentive Scheme 2020. To enable allotment of the shares, the AGM voted in favor of Loomis AB entering into a share swap agreement with a third party under which the third party will acquire the shares in its own name and transfer them to the Incentive Scheme participants. The Incentive Scheme will enable around 350 key individuals within Loomis to become shareholders in Loomis AB over time. This will increase employee commitment to Loomis's development for the benefit of all shareholders. To read the Board's full incentive scheme proposal, refer to the notice of the AGM at www.loomis.com.

The Annual General Meeting also voted in favor of the Board's proposal to amend the Articles of Association, including removing the possibility of issuing shares in different classes. The Company's existing Class B shares are now simply called ordinary shares. The share's ticker on Nasdaq Stockholm has been changed from LOOM B to LOOMIS. The first trading day for the share with the new ticker and ISIN code was June 23, 2020. The share's new ISIN code is SE0014504817.

In June 2020 Loomis announced that Kristoffer Laboc would take up the position as Managing Director of the New Payment Solutions business area. Kristoffer Laboc began in this role on October 1, 2020. His most recent position, before joining Loomis, was with Klarna.

In September 2020 Loomis announced the launch of the Loomis Pay solution in autumn 2020. Loomis Pay is a complete payment platform for merchants and handles all types of payments – cash, card or other digital options, regardless of whether payment is made in a physical store or online. The rollout of Loomis Pay has started in Denmark and it will also be offered in the Swedish market at the beginning of 2021. More and more markets will subsequently be able to enjoy the benefits of Loomis Pay. The Danish technology company GoAppified was acquired to assist Loomis in developing Loomis Pay. The purchase price amounted to around SEK 60 million. For more information on Loomis Pay, see the Loomis press release dated September 9, 2020.

Due to the ongoing coronavirus pandemic, Loomis announced in November that it is unlikely that the previously communicated revenue target of SEK 24 billion for 2021 will be reached. As there is still uncertainty over market conditions in 2021, Loomis decided to remove the revenue target.

Acquisitions January – December 2020

In January 2020 Loomis AB announced that, through the wholly owned subsidiary Loomis Sverige AB (Loomis Sweden), it had entered into an agreement to acquire all of the shares in the limited liability company Nokas Värdehantering AB (Nokas Värdehantering), a subsidiary of Nokas Kontandthåntering AS in Norway. The enterprise value, i.e. the purchase price payable on a debt free basis, was around SEK 80 million. Nokas Värdehantering has around 220 employees and its net revenue over the 12-month period ending in September 2019 was around SEK 215 million. The operating margin, EBITA, was negative. These operations are reported within Segment Europe and are consolidated into Loomis's accounts as of the closing date for the transaction, June 15, 2020. The purchase price was paid on closing. Including integration costs, the acquisition had a negative impact on Loomis's earnings per share for 2020. The acquired business is expected to show a profit after the completion of the integration into Loomis's operations. Nokas CMS AB, a subsidiary of Nokas Värdehantering which has an ATM business in the Nordic region, was not part of the transaction and will remain part of the Nokas Group.

In February 2020 Loomis entered into an agreement to acquire all of the shares in Automatia Pankkiautomaatit Oy (Automatia) from its owners at the time Danske Bank, Nordea and OP Financial Group. The enterprise value, i.e. the purchase price payable on a debt free basis, was around EUR 42 million. Automatia operates Finland's largest ATM business under the Otto brand, but also offers cash supply services to bank branches, service boxes for retail and a digital platform for realtime payments. Automatia has around 30 employees. Its net revenue over the 12-month period ending in December 2019 was around SEK 42 million. Under the acquisition agreement, the sellers have signed long-term service agreements and will therefore also remain important customers of Automatia. These operations are reported within Segment Europe and were consolidated into Loomis's accounts as of the closing date for the transaction, December 2, 2020. The transaction was contingent on approval from the Finnish competition and consumer protection agency. The purchase price was paid on closing. Including integration costs, the acquisition had a marginal impact on Loomis's operating margin, EBITA, and on profit per share for 2020.

Other

In April 2020 it was announced that Loomis AB had signed a two-year credit agreement for SEK 1,200 million in the form of a term loan that will mature in April 2022. The arrangers of the loan are Danske Bank A/S, and Nordea Bank Abp. The loan may be used to finance working capital and investments, and for other corporate purposes.

Kristoffer Wadman, who previously held the position as Chief Innovation Officer, left Group Management in May 2020 and become Managing Director for Loomis Pay.

On July 6, 2020 Loomis announced that it had restructured the management of physical foreign currency (FX) operations in Norway. Loomis Foreign Exchange AS in Norway (Loomis FX) decided to return its Norwegian license and has also received confirmation from the Norwegian financial supervisory authority that Loomis FX is no longer under its supervision. Loomis FX had limited operations in Norway with sales of just over of SEK 60 million in 2019, equivalent to around 0.3 percent of Loomis Group's total sales. Loomis AB, the Group's parent company, and Loomis's French FX company, CPoR, are pursuing an international expansion strategy within FX as communicated at the Capital Markets Day on September 5, 2019. The intention is that CPoR will f unction as a hub and manage the Group's combined FX operations.

In October 2020 Loomis announced that the following representatives of Loomis AB's shareholders will be members of the Nomination Committee for the Annual General Meeting 2021:

• Elisabet Jamal Bergström, appointed by SEB Investment Management, Chairman of the Nomination Committee
• Helen Fasth Gillstedt, appointed by Handelsbanken Fonder
• Bernard Horn, appointed by Polaris Capital Management
• Marianne Nilsson, appointed by Swedbank Robur Fonder
• Jacob Lundgren, appointed by Andra AP-fonden

The Chairman of the Board, Alf Göransson, has convened the Nomination Committee to its first meeting and has also been coopted to the Nomination Committee. The Nomination Committee shall prepare proposals for the Annual General Meeting in 2021 regarding the election of Chairman of the General Meeting, members of the Board of Directors, Chairman of the Board, auditor, fees for the members of the Board including division between the Chairman and the other Board members, as well as fees for committee work, fees to the company's auditor and, if necessary, changes of the instructions for the Nomination Committee.

In November 2020 Loomis announced that it had signed a fiveyear service agreement with EG-US for SafePoint cash automation solutions. The agreement includes installing SafePoint at all of EG-US's store locations over the next 12 months. EG-US has grown to over 1,700 stores across the US and operates under the following brands: Cumberland Farms, Turkey Hill, Kwik Shop, Loaf 'N Jug, Tom Thumb, Quik Stop, Minit Mart, Fastrac and Certified Oil.

Subsequent events

No significant events have occurred after the balance sheet date.

Financial reports in brief

CONSOLIDATED STATEMENT OF INCOME

Note	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Revenue, continuing operations	4,454	5,140	18,454	20,411
Revenue, acquisitions	82	201	359	633
Total revenue 3,4	4,537	5,342	18,813	21,044
Production expenses	–3,316	–3,816	–14,015	–15,210
Gross income	1,220	1,526	4,798	5,833
Selling and administration expenses	–754	–833	–3,024	–3,233
Operating income (EBITA)	467	693	1,775	2,601
Amortization of acquisition-related intangible assets	–28	–26	–109	–101
Acquisition-related costs and revenue 5	–75	–57	–163	–101
Items affecting comparability 6	–114	–2	–200	23
Operating income (EBIT)	250	609	1,304	2,422
Financial income	12	18	31	63
Financial expenses	–50	–63	–211	–240
Loss on monetary net assets/liabilities	–9	–12	–28	–34
Income before taxes	203	552	1,096	2,210
Income tax	–100	–145	–380	–564
Net income for the period1)	103	407	716	1,646
Earnings per share, SEK
Earnings per share before and after dilution, SEK	1.37	5.42	9.52	21.88
Number of shares
Number of outstanding shares (million)	75.2	75.2	75.2	75.2
Average number of outstanding shares before dilution (million)	75.2	75.2	75.2	75.2
Average number of outstanding shares after dilution (million)	75.2	75.2	75.2	75.2

1) Net income for the period is entirely attributable to the owners of the Parent Company.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Net income for the period	103	407	716	1,646
Other comprehensive income
Items that will Note be reclassified to the statement of income
Actuarial gains and losses after tax	74	292	–3	–87
Items that may be reclassified to the statement of income
Exchange rate differences	–941	–479	–1,227	421
Hedging of net investments, net of tax	100	65	119	–74
Other comprehensive income and expenses for the period, net after tax	–767	–123	–1,110	260
Total comprehensive income for the period1)	–664	285	–394	1,906

1) Total comprehensive income is entirely attributable to the owners of the Parent Company.

CONSOLIDATED BALANCE SHEET

Note	2020	2019
SEK m	Dec 31	Dec 31
ASSETS
Fixed assets
Goodwill 5	6,884	7,094
Acquisition-related intangible assets 5	486	478
Other intangible assets	269	208
Buildings and land	942	946
Machinery and equipment	4,158	4,876
Right-of-use assets 8	2,645	2,911
Contract assets	139	199
Deferred tax assets	476	446
Pension plan assets	304	352
Interest-bearing financial fixed assets	361	213
Other long-term receivables	231	172
Total fixed assets	16,894	17,893
Current assets
Accounts receivable	2,199	2,619
Other current receivables	156	110
Current tax assets	290	322
Prepaid expenses and accrued income	488	485
Interest-bearing financial current assets	67	61
Liquid funds 7	4,802	5,073
Total current assets	8,002	8,670
TOTAL ASSETS	24,896	26,563
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity 10
Share capital	376	376
Other capital contributed	4,594	4,594
Other reserves	344	1,463
Retained earnings including net income for the year	3,458	3,158
Non-controlling interest	1	1
Total shareholders' equity	8,773	9,592
Long-term liabilities
Interest-bearing non-current lease liabilities 8	2,105	2,313
Loans payable	5,723	5,793
Deferred tax liabilities	402	447
Provisions for claims reserves	389	413
Provisions for pensions and similar commitments	834	918
Other provisions	106	102
Other long-term liabilities	110	154
Total long-term liabilities	9,669	10,141
Current liabilities
Interest-bearing current lease liabilities 8	546	560
Loans payable	199	29
Accounts payable	600	668
Provisions for claims reserves	187	193
Current tax liabilities	184	199
Liabilities, cash processing operations	2,468	3,021
Accrued expenses and prepaid income	1,514	1,495
Other provisions	86	76
Other current liabilities	670	590
Total current liabilities	6,454	6,831
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	24,896	26,563

CHANGE IN CONSOLIDATED SHAREHOLDERS' EQUITY

	2020	2019
SEK m	Full year	Full year
Opening balance	9,592	8,422
Actuarial gains and losses after tax	–3	–87
Exchange rate differences	–1,227	421
Hedging of net investments, net of tax	119	–74
Total other comprehensive income	–1,110	260
Net income for the period	716	1,646
Total comprehensive income1)	–394	1,906
Dividend paid to Parent Company's shareholders	–414	–750
Share-related remuneration	–11	14
Non-controlling interest	0	0
Closing balance	8,773	9,592

1) Total comprehensive income is entirely attributable to the owners of the Parent Company.

CONSOLIDATED STATEMENT OF CASH FLOWS

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Operations
Income before taxes	203	552	1,096	2,210
Items not affecting cash flow	593	582	2,369	2,138
Financial items received	5	13	24	36
Financial items paid	–59	–96	–231	–247
Income tax paid	–64	–102	–483	–641
Change in accounts receivable	97	81	268	–150
Change in other operating capital employed and other items	–226	–230	–52	17
Cash flow from operations	549	801	2,993	3,362
Investing activities
Investments in fixed assets	–248	–549	–1,014	–1,709
Disposals of fixed assets	–7	24	28	66
Divestments of operations	–	0	–	38
Acquisitions of operations	–545	–22	–853	–384
Cash flow from investing activities	–801	–547	–1,839	–1,989
Financing activities
Dividend paid	–414	–	–414	–750
Change in interest-bearing net debt excluding liquid funds	62	–130	–420	–341
Issuance of bonds	–	1,045	–	2,795
Amortization of bonds	–	–1,000	–	–1,000
Change in commercial papers issued and other long-term borrowing	681	–147	213	–1,753
Cash flow from financing activities	329	–232	–621	–1,049
Cash flow for the period	78	21	533	325
Liquid fund at beginning of the period1)	2,072	1,679	1,655	1,308
Translation differences in liquid funds	–94	–46	–132	22
Liquid funds at end of period1)	2,056	1,655	2,056	1,655

1) Excluding liquid funds within cash processing operations. See also Note 7 Liquid funds.

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Operating income (EBITA)1)	452	680	1,718	2,548
Depreciation1)	288	324	1,266	1,265
Change in accounts receivable	97	81	268	–150
Change in other operating capital employed and other items1)	–220	–235	–48	37
Cash flow from operating activities before investments	617	850	3,204	3,700
Investments in fixed assets, net	–255	–525	–986	–1,643
Cash flow from operating activities	362	325	2,218	2,057
Financial items paid and received1)	–32	–56	–109	–106
Income tax paid	–64	–102	–483	–641
Free cash flow	266	167	1,626	1,310
Cash flow effect of items affecting comparability	–38	–11	–39	–12
Divestment of operations	–	0	–	38
Acquisition of operations	–545	–22	–853	–384
Acquisition-related costs and revenue, paid and received2)	–69	–24	–141	–75
Dividend paid	–414	–	–414	–750
Change in interest-bearing net debt excluding liquid funds1)	198	14	141	155
Issuance of bonds	–	1,045	–	2,795
Amortization of bonds	–	–1,000	–	–1,000
Change in commercial papers issued and other long-term borrowing	681	–147	213	–1,753
Cash flow for the period	78	21	533	325

CONSOLIDATED STATEMENT OF CASH FLOWS EXCLUDING THE IFRS 16 IMPACT, ADDITIONAL INFORMATION

1) Excluding the IFRS 16 impact.

2) Refers to the cash flow effect of acquisition-related transaction-, restructuring and integration costs.

Notes

NOTE 1 – ACCOUNTING PRINCIPLES

The Group's financial reports are prepared in accordance with the International Financial Reporting Standards (IAS/IFRS, as adopted by the European Union) issued by the International Accounting Standards Board, and statements issued by the IFRS Interpretations Committee (IFRIC).

This interim report has been prepared according to IAS 34 Interim Financial Reporting. The most important accounting principles according to IFRS, which are the accounting standards used in the preparation of this interim report, are described in Note 2 on pages 97–105 of the 2019 Annual Report.

New or changed standards and interpretations that entered into force on January 1, 2020 are not expected to have any material effect on the Group's financial statements.

Government grants are recognized according to IAS 20 Accounting for Government Grants and Disclosure of Government Assistance. The Group has received government grants to cover the cost of short-term furloughs. These grants are recognized as a reduction of personnel costs in the income statement in the same period as the costs the grants are intended to cover are recognized.

Critical estimates and assessments

For critical estimates and assessments as well as contingent liabilities, please refer to pages 105–107 and 134 of the 2019 Annual Report. There have been no other significant changes compared to what is described in the Annual Report.

Parent Company – Loomis AB

The Parent Company's financial statements have been prepared in accordance with the Swedish Annual Accounts Act and RFR 2 Accounting for Legal Entities. The most important accounting principles applying to the Parent Company are described in Note 37 on page 138 of the 2019 Annual Report.

NOTE 2 – RISKS AND UNCERTAINTIES Risks

Loomis' operations, which include cash in transit, cash management services and international valuables logistics, involve Loomis assuming the customer's risks associated with managing, transporting and storing cash, precious metals and valuables. Loomis has established routines and processes to identify, take action to mitigate and monitor risks. Risks are assessed based on two criteria: the likelihood that an event will occur and the severity of the consequences for the business if the event should occur. There are risks both in terms of circumstances pertaining to Loomis itself and the industry as a whole, as well as risks that are more general in nature. Certain risks are outside of Loomis' control.

Below is a description of some of the most significant risks and uncertainties that may have a negative impact on Loomis' operations, financial position and results, and that should therefore be taken into account when making assessments based on full-year or interim information. The risks described below are not in any particular order of significance.

Operational risks: Operational risks are risks associated with the day-to-day operations and the services offered by the Company to its customers. Some of the most significant risks Loomis has identified are:

• IT-related risks, such as operational disruptions and extended stoppages of systems linked to operating activities, as well as risks linked to installation of new systems.
• Risk of changed behavioral patterns relating to purchases and payments.
• Customer-related risks, such as the risk of loss of certain customers as well as significant changes in the banking sector.
• Competition risk, such as Loomis' ability to develop competitive offerings.
• Employee risk, such as a high staff turnover.
• Risk of robbery and other criminal activity.
• Risk of internal theft and/or failing cash reconciliation routines at cash centers.
• Risk associated with the implementation of acquisitions, such as difficulties integrating new operations and employees, as well as the anticipated benefits of a certain acquisition not being realized or being only partially realized.

Financial risks: In its operations, Loomis is exposed to risk associated with financial instruments such as liquid funds, accounts receivable, accounts payable and loans. The risks relating to these instruments are mainly:

• Interest rate risk associated with liquid funds and loans.
• Exchange rate risk associated with transactions and translation of shareholder's equity.
• Financing risk relating to the Company's capital requirements.
• Liquidity risk associated with short-term solvency.
• Credit risk pertaining to financial and commercial activities.
• Capital risk pertaining to the capital structure.
• Price risk.

The financial risks are described in more detail in Note 6 in the 2019 Annual Report.

Legal risks: Through its operations Loomis is exposed to legal risks such as:

• Risk of disputes and legal action.
• Risk associated with the application of existing laws, other regulations and changes in legislation.

Factors of uncertainty

The economic trends during 2020 impacted certain geographic areas negatively and Loomis's revenue and earnings were negatively impacted during the year.

As a consequence of the outbreak of the coronavirus (COVID-19), the authorities in many markets have initiated measures that have lowered demand in retail business in these countries and the Company's revenue and earnings during 2020 were negatively impacted thereof. The negative impact of the coronavirus pandemic on revenue and earnings is expected to continue until the pandemic subsides, actions initiated in connection with the pandemic have been fully implemented and retail businesses in the countries where Loomis operates begin to grow again. Loomis is monitoring events carefully and taking steps to minimize or eliminate the impact on the Group's operations. Loomis is following the guidelines issued by the Public Health Agency of Sweden, the WHO, ECDC (European Centre for Disease Prevention and Control) and the CDC in the USA.

Changes in general economic conditions and market trends have various effects on demand for cash handling services. These include the ratio of cash purchases to credit card purchases, changes in consumption levels, the risk of robbery and bad debt losses, and the staff turnover rate.

The preparation of financial reports requires the Board of Directors and Group Management to make estimates and assessments. Estimates and assessments affect both the income statement and the balance sheet as well as the information disclosed on things like contingent liabilities. Actual outcomes may deviate from these estimates and assessments depending on other circumstances or other conditions.

In 2020 the actual financial results of certain previously reported items affecting comparability, provisions and contingent liabilities, as described in the 2019 Annual report and where applicable under the heading "Critical estimates and assessments" in Note 1 of this report, may deviate from the financial assessments and provisions made by management. This may impact the Group's profitability and financial position.

Seasonal variations

Loomis' earnings fluctuate across the seasons and this should be taken into consideration when making assessments based on interim financial information. The primary reason for these seasonal variations is that the need for cash handling services increases during the vacation periods and in connection with public holidays.

NOTE 3 – REVENUE DISTRIBUTION

			Other and				Other and
	Europe	USA	eliminations	Total	Europe	USA	eliminations	Total
SEK m		2020	Quarter 4		Quarter 4 2019
Cash in transit (CIT)	1,440	1,324	–	2,764	1,764	1,477	–	3,242
Cash management services (CMS)	616	750	–	1,366	810	847	–	1,657
International	187	85	–	272	209	82	–	291
Other	118	13	4	135	147	4	–	151
Revenue, internal	7	12	–19	–	11	14	–25	–
Total revenue	2,368	2,184	–15	4,537	2,942	2,424	–25	5,342
Timing of revenue recognition, external
At a point in time	380	84	–	465	388	74	–	462
Over time	1,981	2,089	3	4,072	2,544	2,336	–	4,880
Total external revenue	2,361	2,173	3	4,537	2,932	2,410	–	5,342

	Other and					Other and
	Europe	USA	eliminations	Total	Europe	USA	eliminations	Total
SEK m		Twelve months 2020			Twelve months 2019
Cash in transit (CIT)	5,923	5,632	–	11,555	6,856	5,946	–	12,802
Cash management services (CMS)	2,518	3,074	–	5,592	3,172	3,288	–	6,460
International	768	324	–	1,092	812	333	–	1,145
Other	541	27	7	574	619	17	–	636
Revenue, internal	38	41	–79	–	39	53	–92	–
Total revenue	9,788	9,098	–72	18,813	11,498	9,639	–92	21,044
Timing of revenue recognition, external
At a point in time	1,495	322	1	1,817	1,566	311	–	1,877
Over time	8,255	8,735	6	16,996	9,893	9,274	–	19,167
Total external revenue	9,750	9,057	7	18,813	11,459	9,585	–	21,044

REVENUE PER SIGNIFICANT GEOGRAPHICAL MARKET

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Twelve months	Twelve months
USA	2,184	2,424	9,098	9,639
France	696	835	2,962	3,166
Spain	325	424	1,327	1,632
UK	223	396	1,028	1,562
Switzerland	223	241	908	946
Other countries and eliminations	886	1,022	3,490	4,099
Total revenue	4,537	5,342	18,813	21,044

NOTE 4 – SEGMENT OVERVIEW

Loomis has operations in a number of countries, with country presidents being responsible for each country. Segment presidents supervise operations in a number of countries and also support the respective country president. Operating segments are reported in accordance with the internal Loomis reporting, submitted to Loomis' CEO who has been identified as the most senior executive decision-maker within Loomis. Loomis has the following segments: Europe, USA, and Other. Presidents for the segments Europe and USA are responsible for following up the segments' operating income before amortization of acquisitionrelated intangible assets, acquisition-related costs and revenue and items affecting comparability (EBITA), according to the manner in which Loomis reports its consolidated statement of income. This then forms the basis for how the CEO monitors development, allocates resources etc. Loomis has therefore chosen this structure for its segment reporting.

SEGMENT OVERVIEW STATEMENT OF INCOME

Twelve months 2020	Europe	USA	Other1)	Eliminations	Total
SEK m
Revenue, continuing operations	9,446	9,088	–	–79	18,454
Revenue, acquisitions	342	10	7	–	359
Total revenue	9,788	9,098	7	–79	18,813
Production expenses	–7,735	–6,312	–75	107	–14,015
Gross income	2,053	2,786	–68	28	4,798
Selling and administrative expenses	–1,465	–1,361	–170	–28	–3,024
Operating income (EBITA)	588	1,425	–238	–	1,775
Amortization of acquisition-related intangible assets	–89	–20	0	–	–109
Acquisition-related costs	–128	–6	–28	–	–163
Items affecting comparability	–197	–	–3	–	–200
Operating income (EBIT)	174	1,400	–270	–	1,304
Net financial items	–	–	–180	–	–180
Loss on monetary net assets/liabilities	–	–	–28	–	–28
Income before taxes	174	1,400	–477	–	1,096

1) Segment Other consists of the Parent Company's costs, certain other group-wide costs and costs and revenue for Loomis Pay.

SEGMENT OVERVIEW STATEMENT OF INCOME

Twelve months 2019	Europe	USA	Other1)	Eliminations	Total
SEK m
Revenue, continuing operations	10,866	9,638	–	–92	20,411
Revenue, acquisitions	632	1	–	–	633
Total revenue	11,498	9,639	–	–92	21,044
Production expenses	–8,490	–6,835	–	114	–15,210
Gross income	3,008	2,804	–	22	5,833
Selling and administrative expenses	–1,578	–1,432	–200	–22	–3,233
Operating income (EBITA)	1,429	1,372	–200	–	2,601
Amortization of acquisition-related intangible assets	–81	–20	–	–	–101
Acquisition-related costs	–57	–	–44	–	–101
Items affecting comparability	35	–	–12	–	23
Operating income (EBIT)	1,327	1,352	–256	–	2,422
Net financial items	–	–	–178	–	–178
Loss on monetary net assets/liabilities	–	–	–34	–	–34
Income before taxes	1,327	1,352	–469	–	2,210

1) Segment Other consists of the Parent Company's costs and certain other group-wide costs.

SEGMENT OVERVIEW STATEMENT OF INCOME, ADDITIONAL INFORMATION

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Europe
Operating income (EBITA)	144	358	588	1,429
Operating margin (EBITA), %	6.1	12.2	6.0	12.4
USA
Operating income (EBITA)	382	383	1,425	1,372
Operating margin (EBITA), %	17.5	15.8	15.7	14.2
Other 1)
Revenue	4	–	7	–
Operating income (EBITA)	–60	–47	–238	–200
Eliminations
Revenue	–19	–25	–79	–92
Operating income (EBITA)	–	–	–	–
Group total
Operating income (EBITA)	467	693	1,775	2,601
Operating margin (EBITA), %	10.3	13.0	9.4	12.4

1) Segment Other consists of the Parent Company's costs, certain other group-wide costs and costs and revenue for Loomis Pay.

SEGMENT OVERVIEW BALANCE SHEET

	2020	2019
SEK m	Dec 31	Dec 31
Europe
Assets	10,543	11,234
Liabilities	5,344	6,038
USA
Assets	9,079	9,965
Liabilities	1,494	1,547
Other 1)
Assets	5,274	5,364
Liabilities	9,285	9,386
Shareholder's equity	8,773	9,592
Group total
Assets	24,896	26,563
Liabilities	16,123	16,971
Shareholder's equity	8,773	9,592

1) Segment Other consists mainly of Group assets and liabilities that cannot be divided by segment.

NOTE 5 – ACQUISITIONS

In January 2020 Loomis AB announced that, through the wholly owned subsidiary Loomis Sverige AB (Loomis Sweden), it had entered into an agreement to acquire all of the shares in Nokas Värdehantering AB (Nokas Värdehantering), a subsidiary of Nokas Kontandthåntering AS in Norway. The acquired operations are reported in the European segment and are consolidated into Loomis's accounts as of the closing of the transaction, June 15, 2020.

In February 2020 Loomis entered into an agreement to acquire all of the shares in Automatia Pankkiautomaatit Oy (Automatia) from its current owners Danske Bank, Nordea and OP Financial Group. The enterprise value, i.e. the purchase price payable on a debt-free basis, is around EUR 42 million. The acquired operations are reported in the European segment and are consolidated into Loomis's accounts as of the closing of the transaction, December 2, 2020. The transaction was contingent upon approval by the Finnish Competition and Consumer Authority. The approval was received in October 2020.

In addition to the above acquisitions, one smaller acquisition was implemented in the second quarter of 2020 and a further smaller acquisition in the third quarter of 2020.

ACQUISITIONS

								Acquisition related	Other acquired
	Consolidated as of	Segment	Acquired share1) %	Annual revenue SEK m	Number of employees	Purchase price SEK m	Goodwill SEK m	intangible assets SEK m	net assets SEK m
Opening balance, January 1, 2020							7 094	478
Acquisition of Nokas Värdehantering AB4)	June	Europe	100	2152)	220	1213)	307)	69	22
Acquisition of Automatia Pankkiautomaatit OY5)	December	Europe	100	4292)	30	5453)	2487)	–	297
Other acquisitions6)	June/September	Other/USA	100	272)	8	1663)	1557)	71	–61
Total acquisitions January – December 2020							433	140	258
Write-down of book values							–46	–
Amortization of acquisition related intangible assets							–	–109
Exchange rate differences							–597	–23
Closing balance December 31, 2020							6,884	486

1) Refers to share of votes. In acquisitions of assets and liabilities, no share of votes is indicated.

2) Annual revenue translated to SEK million on the acquisition date. Based on 2019 revenue.

3) The enterprise value, i.e. the purchase price payable on a debt free basis, on the acquisition date amounted to around SEK 80 million for Nokas Värdehantering AB, to around SEK 350 million for Automatia and to around SEK 76 million and around SEK 120 million respectively for other acquisitions.

4) Complete IFRS 3 disclosures are not disclosed as the completed acquisition is not deemed to materially impact the Group's statement of income or financial position.

5) The acquisition analysis is preliminary and subject to final adjustment no later than one year from the acquisition date.

6) Complete IFRS 3 disclosures are not disclosed as the completed acquisitions are not deemed to materially impact the Group's statement of income or financial position.

7) Goodwill arising in connection with the acquisition is primarily attributable to market and synergy effects. Any impairment is not tax deductible.

Acquisition of Automatia Pankkiautomaatit Oy, Finland

The acquisition has, as from the time of acquisition up to December 31, 2020, contributed approximately SEK 33 million to total revenue and approximately SEK 0 million to net income. If the acquisition had been completed on January 1, 2020, Loomis estimates that the Group's total revenue would have been affected by approximately SEK 393 million and net income by approximately SEK 23 million. Total transaction costs for the acquisition amounted to approximately SEK 33 million and have been recognized on the line item Acquisition related costs.

Impact on the Group's liquid funds from the acquisition of Automatia Pankkiautomaatit Oy, Finland

Purchase price of SEK 545 million (53 MEUR) was paid on acquisition date and acquired liquid funds amounted to SEK 210 million. Net impact on the Group's liquid funds was SEK –335 million.

Summarized preliminary balance sheet from the acquisition of Automatia Pankkiautomaatit Oy, as of the acquisition date December 2, 2020.

SEK m	Preliminary acquisition balance
Intangible assets	31
Tangible assets	94
Accounts receivable and other receivables	27
Liquid funds	210
Interest-bearing liabilities	–15
Accounts payable and other operating liabilities	–49
Deferred tax liability	–
Net identifiable assets and liabilities	297
Purchase price paid	545
Deferred consideration	–
Goodwill	248

NOTE 6 – ITEMS AFFECTING COMPARABILITY

	2020	2019	2020	2019
SEK m	Quarter 4	Quarter 4	Full year	Full year
Restructuring costs within the European segment	–114	–	–162	–
Write-down of goodwill in an operation within the European segment	–	–	–46	–
Capital gains from the divestment of Artcare	–	2	–	35
Provisions/resolutions regarding legal processes	–	–4	9	–13
Total items affecting comparability	–114	–2	–200	23

NOTE 7 – LIQUID FUNDS

	2020	2019
SEK m	Dec 31	Dec 31
Liquid funds	4,802	5,073
Adjusted for inventory of cash at the cash processing operations	–2,134	–2,384
Adjusted for prepayments from customers	–612	–1,034
Liquid funds excluding funds for cash processing activities	2,056	1,655

NOTE 8 – LEASES

Loomis has applied IFRS 16 since January 1, 2019. The Group is using the simplified transition method, modified retroactively, and has therefore not restated the comparative figures. For further information about IFRS 16, please see Note 2 of the 2019 Annual Report.

Impact

As a result of the introduction of IFRS 16 the operating income (EBITA) is charged with depreciation of right-of-use assets instead of an operating lease expense. In addition, the increased lease liability is negatively impacting net financial expense. See also the tables below.

Right-of-use assets, which are reported on a separate line in the balance sheet, amounted to SEK 2,645 million as of December 31, 2020 (2,911). Buildings account for 73 percent (76) of total rightof-use assets. The lease liability as of December 31, 2020 totaled SEK 2,651 million (2,873), of which the long-term lease liability amounts to SEK 2,105 million (2,313) and the short-term lease

liability to SEK 546 million (560). The long-term and short-term lease liabilities are recognized as interest-bearing long-term lease liabilities and interest-bearing short-term lease liabilities respectively in the balance sheet.

As of December 31, 2020, the costs relating to short-term leases (lease term of 12 months or less) amounted to SEK 35 million (34) and leases for which the underlying asset has a low value (<USD 5,000) amounted to SEK 11 million (11).

Outcomes for Loomis' key ratios are presented below both including and excluding the impact of IFRS 16 as of December 31, 2020:

	Including IFRS 16	Excluding IFRS 16
SEK m	Dec 31 2020	Dec 31 2020
Net debt	6,619	4,032
Net debt/EBITDA	1.82	1.35
Return on capital employed, %	12	13

	Including IFRS 16	Excluding IFRS 16	Including IFRS 16	Excluding IFRS 16	Including IFRS 16	Excluding IFRS 16	Including IFRS 16	Excluding IFRS 16
SEK m	Quarter 4 2020	Quarter 4 2020	Quarter 4 2019	Quarter 4 2019	Twelve months 2020	Twelve months 2020	Twelve months 2019	Twelve months 2019
Operating income, EBITDA	904	740	1,169	1,003	3,645	2,984	4,435	3,813
Depreciation	438	288	476	324	1,871	1,266	1,834	1,265
Operating income, EBITA	467	452	693	680	1,775	1,718	2,601	2,548
Operating margin, EBITA, %	10.3	10.0	13.0	12.7	9.4	9.1	12.4	12.1
Financial income and ex pense	–38	–15	–45	–19	–180	–83	–178	–73
Net income for the period	103	109	407	417	716	746	1,646	1,685
Earnings per share	1.37	1.45	5.42	5.54	9.52	9.92	21.88	22.40
Investments in relation to depreciation	0.6	0.9	1.1	1.6	0.5	0.8	0.9	1.3

NOTE 9 – TRANSACTIONS WITH RELATED PARTIES

Transactions between Loomis and related parties are described in Note 7 of the 2019 Annual Report. As previously communicated, board member Lars Blecko provides consulting services to Loomis Armored US LLC pursuant to an existing agreement between Loomis Armored US LLC and a company owned by him. Board member Johan Lundberg has also been asked to provide consulting services as of January 1, 2020. There have been no transactions with related parties during the period that have materially impacted the Company's earnings and financial position.

NOTE 10 – NUMBER OF SHARES AS OF DECEMBER 31, 2020

Votes	No. of shares			SEK m
1	75,279,829	75,279,829	5	376
	75,279,829	75,279,829		376
1	–53,797	–53,797
	75,226,032	75,226,032
				No. of votes Quota value

1) The number of treasury shares has remained unchanged during the period and has not affected shareholders' equity.

NOTE 11 – CONTINGENT LIABILITIES, GROUP

	2020	2019
SEK m	Dec 31	Dec 31
Guarantees and other commitments	2,191	2,014

KEY RATIOS

	2020	2019	2020	2019
	Quarter 4	Quarter 4	Full year	Full year
Real growth, %	–7.4	4.9	–7.8	5.1
Organic growth, %	–8.9	1.4	–9.4	2.3
Total growth, %	–15.1	7.8	–10.6	9.8
Gross margin, %	26.9	28.6	25.5	27.7
Selling and administration expenses in % of total revenue	–16.6	–15.6	–16.1	–15.4
Operating margin (EBITA), %	10.31)	13.01)	9.41)	12.41)
Tax rate, %	49	26	35	26
Net margin, %	2.3	7.6	3.8	7.8
Return on shareholders' equity, %	8	17	8	17
Return on capital employed, %	121)	15	121)	15
Equity ratio, %	35	36	35	36
Liquid funds excluding funds within cash processing operations (SEK m)	2,056	1,655	2,056	1,655
Net debt (SEK m)	6,6191)	7,332	6,6191)	7,332
Net debt/EBITDA	1.821)	1.65	1.821)	1.65
Cash flow from operating activities as % of operating income (EBITA)2)	80	48	129	81
Investments in relation to depreciation	0.61)	1.11)	0.51)	0.91)
Investments as a % of total revenue	5.6	9.8	5.2	7.8
Earnings per share before and after dilution, SEK3)	1.371)	5.421)	9.521)	21.881)
Shareholders' equity per share before and after dilution, SEK	116.62	127.51	116.62	127.51
Cash flow from operating activities per share after dilution, SEK	7.30	10.64	39.79	44.69
Dividend per share, SEK	5.50	–	5.50	10.00
Number of outstanding shares (millions)	75.2	75.2	75.2	75.2
Average number of outstanding shares (millions)3)	75.2	75.2	75.2	75.2

1) For information on key ratios excluding the IFRS 16 impact, see Note 8.

2) Excluding the IFRS 16 impact.

3) The number of outstanding shares, which constitutes the basis for calculation of earnings per share before dilution, is 75,226,032. The number of treasury shares amount to 53,797.

Parent Company

PARENT COMPANY SUMMARY STATEMENT OF INCOME

	2020	2019
SEK m	Full year	Full year
Revenue	444	631
Operating income (EBIT)	241	374
Income after financial items	464	733
Net income for the period	400	692

The Parent Company's revenue consists mainly of license fees, dividends and other revenues from subsidiaries. The decrease in net income in 2020 is mainly due to decreased dividends from subsidiaries and reduced license fees due to the corona pandemic, and group contributions paid. In addition, shares in subsidiaries was impaired in 2020.

PARENT COMPANY SUMMARY BALANCE SHEET

2020	2019
Dec 31	Dec 31
12,687	11,571
1,318	1,671
14,005	13,242
5,147	5,158
8,858	8,084
14,005	13,242

1) The number of treasury shares was 53,797 for all periods above.

The Parent Company's fixed assets consist mainly of shares in subsidiaries and loan receivables from subsidiaries. The liabilities are mainly external liabilities and liabilities to subsidiaries. In December, the Parent Company paid dividends to its shareholders.

CONTINGENT LIABILITIES, PARENT COMPANY

	2020	2019
SEK m	Dec 31	Dec 31
Guarantees and other commitments	4,585	4,444

Alternative performance measures

Use of alternative performance measures

To support Group Management and other stakeholders to analyze the Group's financial performance, Loomis reports certain performance measures that are not defined by IFRS. Group Management believes that this information facilitates analysis of the Group's performance. The Loomis Group primarily uses the following alternative performance measures (see also Definitions on page 26 for a full list of measures):

• Real growth and organic growth in sales
• Operating income (EBITA) and operating margin (EBITA), %
• Cash flow from operating activities as % of operating income (EBITA)
• Net debt and net debt/EBITDA
• Capital employed and return on capital employed
• Return on shareholders' equity

Real growth and organic growth in sales

Since Loomis generates most of its revenue in currencies other than the reporting currency (i.e. Swedish kronor, SEK) and exchange rates have historically proved to be relatively volatile, and since the Group has made a number of acquisitions, sales growth is presented both as exchange rate adjusted and adjusted for both exchange rate fluctuations and effects from acquisitions. This makes it possible to analyze and explain growth excluding exchange rate effects and acquisitions.

	2020	2019
	Quarter 4 Quarter 4			Growth Growth,%
Recognized revenue	4,537	5,342	–805	–15.1%
Organic growth			–475	–8.9%
Revenue, acquisitions			82	1.5%
Real growth			–393	–7.4%
Exchange rate effects			–412	–7.7%

	2020	2019
	Full year	Full year		Growth Growth,%
Recognized revenue	18,813	21,044	–2,231	–10.6%
Organic growth			–1,968	–9.4%
Revenue, acquisitions			326	1.6%
Real growth			–1,642	–7.8%
Exchange rate effects			–589	–2.8%

Operating income (EBITA) and operating margin (EBITA), %

Loomis's internal control of operating activities is focused on the operating income that is created within and can be impacted by local operating activities. For this reason Loomis has chosen to focus on earnings and margins before interest, taxes, amortization of acquisition-related intangible fixed assets, acquisition-related costs and revenue, and items affecting comparability.

	2020	2019	2020	2019
	Quarter 4	Quarter 4	Full year	Full year
Operating income (EBITA)	250	609	1,304	2,422
Adding back items affecting comparability	114	2	200	–23
Adding back acquisition-related costs and revenue	75	57	163	101
Adding back amortization of acquisition-related intangible assets	28	26	109	101
Operating income (EBITA)	467	693	1,775	2,601
Calculation of operating margin (EBITA), %
EBITA	467	693	1,775	2,601
Total revenue	4,537	5,342	18,813	21,044
EBITA/Total revenue, %	10.3	13.0	9.4	12.4

Cash flow from operating activities as % of operating income (EBITA)

Loomis's main measure of cash flow (cash flow from operating activities) focuses on the current cash flow from operating activities based on EBITA adding back amortization/depreciation and the effect of changes in accounts receivable, as well as changes in other working capital and other items. Cash flow from operating activities reflects the cash flow that the operating activities generate before payments of financial items, income tax, items affecting comparability, acquisitions and divestments, as well as dividends and changes in the Group's net debt. Cash flow from operating activities as a percentage of operating income (EBITA) illustrates the cash conversion that Loomis has, i.e. how recognized earnings have resulted in cash flow.

Loomis provides an alternative presentation of cash flow which includes cash flow from operating activities. This is presented on page 13 of this report.

Net debt and net debt/EBITDA

Net debt is an important concept to understand a company's financing structure and leverage. Net debt is the net of interestbearing liabilities and assets, and is used together with shareholders' equity to finance the Group's capital employed. Loomis excludes funds within cash processing operations and financing of funds within cash processing operations (so-called stock funding) from the definition of net debt. The financial leverage is measured by calculating net debt as percentage of operating income after adding back amortization and depreciation, i.e. net debt/EBITDA.

Reconciliation of net debt and calculation of net debt/EBITDA

	2020	2019
SEK m	Dec 31	Dec 31
Short-term loans	199	29
Long-term loans	5,723	5,793
Total loans payable	5,922	5,822
Liquid funds excluding funds in cash processing operations	2,056	1,655
Other interest-bearing assets	428	274
Financial net debt	3,438	3,893
Lease liabilities	2,651	2,873
Pension liabilities, net	530	566
Net debt	6,619	7,332

	2020	2019
SEK m	Full year	Full year
Operating income (EBITA)	1,775	2,601
Adding back depreciation/amortization	1,871	1,834
EBITDA	3,645	4,435
Net debt/EBITDA (number of times)	1.82	1.65

Capital employed and return on capital employed, % Capital employed is a measure of how much capital is tied up in operating activities and that is therefore expected to generate returns in the form of operating income. Capital employed is equivalent to the sum of all financing in the form of net debt and shareholders' equity. Loomis includes funds within cash processing operations and financing of funds within cash processing operations (so-called stock funding) in the definition of capital employed.

Reconciliation of capital employed and return on capital employed, %

	2020	2019
SEK m	Dec 31	Dec 31
Fixed assets
Goodwill	6,884	7,094
Acquisition-related intangible assets	486	478
Other intangible assets	269	208
Buildings and land	942	946
Machinery and equipment	4,158	4,876
Right-of-use assets	2,645	2,911
Other operating fixed assets1)	846	817
Current assets
Accounts receivable	2,199	2,619
Other operating current assets2)	934	917
Funds in cash processing operations	2,746	3,418
Long-term liabilities
Deferred tax liability	–402	–447
Provisions for claims reserves	–389	–413
Other provisions	–106	–102
Other long-term liabilities	–110	–154
Current liabilities
Accounts payable	–600	–668
Liabilities in cash processing operations	–2,468	–3,021
Accrued expenses and prepaid income	–1,514	–1,495
Other operating current liabilities3)	–1,127	–1,059
Capital employed	15,392	16,924
Operating income (EBITA)	1,775	2,601
Return on capital employed, %	11.5	15.4

1) Includes the items "Contract assets", "Deferred tax assets" and "Other long-term receivables".

2) Includes the items "Other current receivables", "Current tax assets", and "Prepaid expenses and accrued income".

3) Includes the items "Provisions for tax reserves", "Current tax liabilities, "Other provisions" and "Other current liabilities".

Return on shareholders' equity

Return on shareholders' equity is an important concept to understand a company's return on the capital that the shareholders have injected and earned. The return is calculated as earnings for the period (rolling 12 months) as a percent of the closing balance for shareholders' equity.

	2020	2019
SEK m	Full year Full year
Net income for the period	716	1,646
Shareholders' equity	8,773	9,592
Return on equity, %	8.2	17.2

Definitions

Gross margin, %	Gross income as a percentage of total revenue.
Operating income (EBITA)	Earnings Before Interest, Taxes, Amortization of acquisition-related intangible fixed assets, Acquisition-related costs and revenue and Items affecting comparability.
Operating margin (EBITA), %	Earnings Before Interest, Taxes, Amortization of acquisition-related intangible fixed assets, Acquisition-related costs and revenue and Items affecting comparability, as a percentage of revenue.
Operating income (EBITDA)	Earnings Before Interest, Taxes, Depreciation, Amortization of acquisition-related intangible fixed assets, Acquisition-related costs and revenue and Items affecting comparability.
Operating income (EBIT)	Earnings Before Interest and Tax.
Items affecting comparability	Items affecting comparability are reported events and transactions whose impact are important to note when the period's results are compared with previous periods, such as capital gains and capital losses from divestments of significant cash generating units, material write-downs or other significant items affecting comparability.
Real growth, %	Increase in revenue for the period, adjusted for changes in exchange rates, as a percentage of the previous year's revenue.
Organic growth, %	Increase in revenue for the period, adjusted for acquisition/divestitures and changes in exchange rates, as a percentage of the previous year's revenue adjusted for divestitures.
Total growth, %	Increase in revenue for the period as a percentage of the previous year's revenue.
Net margin, %	Net income for the period after tax as a percentage of total revenue.
Earnings per share before dilution	Net income for the period in relation to the average number of outstanding shares during the period.
Earnings per share after dilution	Net income for the period in relation to the average number of outstanding shares after dilution during the period.
Cash flow from operations per	Cash flow for the period from operations in relation to the number of shares after dilution.
share
Investments in relation to depreciation	Investments in fixed assets, net, for the period, in relation to depreciation, excluding the IFRS 16 impact.
Investments as a % of total revenue	Investments in fixed assets, net, for the period, as a percentage of total revenue.
Shareholders' equity per share	Shareholders' equity in relation to the number of shares before and after dilution.
Cash flow from operating activities as % of operating income (EBITA)	Operating income, EBITA, (excluding IFRS 16), adjusted for depreciation (excluding IFRS 16), change in accounts receivable and other items (excluding IFRS 16) as well as net investments in fixed assets as a percentage of operating income, EBITA, (excluding IFRS 16).
Return on equity, %	Net income for the period (rolling 12 months) as a percentage of the closing balance of shareholders' equity.
Return on capital employed, %	Operating income (EBITA) (rolling 12 months) as a percentage of the closing balance of capital employed.
Equity ratio, %	Shareholders' equity as a percentage of total assets.
Capital employed	Shareholders' equity with the addition of net debt.
Net debt	Interest-bearing liabilities less interest-bearing assets and liquid funds excluding funds for cash processing activities.
R12	Rolling 12 months.
n/a	Not applicable.

Stockholm February 3, 2021

Patrik Andersson President and CEO

Review Report

Introduction

We have reviewed the interim report for Loomis AB (publ) for the period January 1 – December 31, 2020. The Board of Directors and the President are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.

Scope of Review

We conducted our review in accordance with 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 less in scope than an audit conducted in accordance with ISA and other generally accepted auditing practices. 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 might be identified in an audit. Therefore, the conclusion expressed based on a review does not give the same level of assurance as a conclusion expressed based on an audit.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the interim report is not, in all material respects, prepared 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 February 3, 2021

Deloitte AB

Peter Ekberg Authorized Public Accountant

Loomis in brief

Vision

Managing cash in society.

Financial targets 2018–2021

• Dividend: 40–60 percent of net income.

Sustainability targets

• Zero workplace injuries.

• Decrease carbon emission by 30 percent by 2021.
• Decrease plastic volumes by 30 percent by 2021.

Operations

Loomis offers secure and effective comprehensive solutions for the distribution, handling, storage and recycling of cash and other valuables. Loomis' customers are banks, retailers and other operators. Loomis operates through an international network of around 400 branches in more than 20 countries. Loomis employs around 23,000 people and had revenue in 2020 of approximately SEK 19 billion. Loomis is listed on Nasdaq Stockholm Large-Cap list.

Telephone conference and audio cast

A telephone conference will be held on February 3, 2021 at 09:00 a.m. (CET).

To follow the conference call via telephone and to participate in the question and answer session, please call: UK: + 44 333 300 9267 USA: + 1 833 526 8398 Sweden: +46 8 505 583 50

The audio cast can be followed at our website www.loomis.com (follow "Financial presentation").

A recorded version of the audio cast will be available at www.loomis.com (follow "Financial presentation") after the telephone conference.

Future reporting and annual report

Interim report	January – March	May 6, 2021
Interim report	January – June	July 23, 2021
Interim report	January – September	November 3, 2021

Loomis' Annual Report for 2020 will be available at www.loomis.com in April 2021. Loomis' Annual General meeting will be held on May 6, 2021 in Stockholm.

For further information

Anders Haker, Chief Investor Relations Officer +1 281 795 8580, e-mail: anders.haker@loomis.com Refer also to the Loomis website: www.loomis.com

This information is information that Loomis AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 08.00 a.m. (CET) on February 3, 2021.