NAXS — Interim / Quarterly Report 2016

Apr 22, 2016

NAXS Nordic Access Buyout Fund AB (publ) Interim Report January-March 2016

First quarter 2016

• Net profit for the first quarter amounted to MSEK 25.2 (23.8).
• Earnings per share amounted to SEK 1.69 (1.60).
• Net asset value amounted to MSEK 811 (SEK 54.52 per share) at March 31, 2016, compared to MSEK 785 (SEK 52.78 per share) at year-end 2015.
• Net cash amounted to MSEK 362 (SEK 24.34 per share) at March 31, 2016, compared to MSEK 351 (SEK 23.60 per share) at year-end 2015.

Comments by the CEO

NAXS made good progress during the first three months of the year, with the net asset value per share rising by 3.3%.

The financial markets continued to be volatile during the first quarter, and we expect such volatility to prevail. And while private equity activity has slowed, competition for quality assets remains strong. In the short to medium term, NAXS intends to put additional focus on co-investments, secondary and other alternative investments. This is also in-line with the recently revised investment policy for the Company.

Lennart Svantesson

Financial summary

	2016 1/1–03/31	2015 1/1–03/31
Net profit/loss for the period, KSEK
	25 193	23 777
	2016	2015
	03/31	12/31
Private equity fund investments, KSEK	449 500	434 246
Private equity fund investments in % of equity	55	55
Remaining commitments, KSEK	87 524	104 748
Total exposure to private equity fund investments, KSEK	537 024	538 994
Net cash, KSEK	361 924	350 970
Private equity fund investments per share, SEK	30.23	29.20
Net cash per share, SEK	24.34	23.60
Net asset value per share, SEK	54.52	52.78
Share price, SEK	49.80	54.00

Operations

NAXS Nordic Access Buyout Fund AB (publ) ("NAXS" or the "Company") is an investment company listed on NASDAQ Stockholm. NAXS primarily invests in private equity funds with a Nordic focus, but may also make direct investments or co-investments alongside private equity or other alternative assets funds. In addition, NAXS may, to a limited extent, make other types of investments.

Operations commenced on April 17, 2007, and the Company was listed on First North on May 14, 2007, where it traded until its change of listing to NASDAQ Stockholm on June 8, 2010.

NAXS is the Group's parent company and is headquartered in Stockholm. In addition to the parent company, the Group consists of an operational Danish subsidiary, NAXS Nordic Access Buyout A/S, headquartered in Copenhagen, and a Norwegian subsidiary, NAXS Nordic Access Buyout AS, headquartered in Oslo. The Danish subsidiary operates as the holding company for the Group's investments.

Naccess Partners AB has been contracted as the investment advisor to the Danish subsidiary.

Market review

The first quarter of the year saw a fall in private equity activity in Europe, as many managers hold off doing deals due in the prevailing volatile environment. Those managers who were active during the period seemed to focus more on exits than acquisitions, and selectively exploited opportunities to proceed to initial public offerings.

Investment portfolio

As of March 31, 2015, NAXS had commitments to 8 private equity funds.

At the end of the reporting first quarter:

• private equity fund investments amounted to MSEK 450, which corresponds to 55 percent of the Company's equity;
• remaining commitments amounted to MSEK 88, which can be used by the underlying funds for new investments;
• total exposure to private equity fund investments amounted to MSEK 537, which corresponds to 66 percent of the Company's equity.

Total exposure to private equity fund

Private equity fund investments and total exposure to private equity fund investments (in % of equity)

55% 11% 0% 25% 50% 75% 100% 125% 55% 45% 0% 25% 50% 75% 100% investments 66% (MSEK 537 ) Equity MSEK 811 Remaining commitments 11% (MSEK 88) Net cash 45% (MSEK 362) Private equity fund investments 55% (MSEK 450) Private equity fund investments 55% (MSEK 450)

The net asset value (NAV) per share increased by 3.3% during the first quarter of 2016, and by 9.4% over 12 months (including the dividend paid).

Acquisitions and liquidity events

Acquisitions

The first quarter saw 1 new acquisition, with Intera II announcing its investment in Telinekymppi, a Finnish scaffolding rental services provider.

Portfolio Company	Sector	Country	Fund
Telinekymppi	Building & construction	Finland	Intera II

In addition, a number of add-on acquisitions were completed during the quarter.

Liquidity events

1 partial exit took place during the quarter, with Apax Europe VII listing Ascential (formerly Top Right Group) on the London Stock Exchange in February.

As of March 31, 2016, NAXS underlying funds had acquired a total of 110 companies, 37 of which had been fully divested. These 37 exits have generated an average gross IRR of 23%.

No. of portfolio companies acquired per year (exited companies in grey)

• 110 portfolio companies acquired since inception
• 37 companies fully exited
• Average holding period of the remaining 73 portfolio companies is approx. 4.5 years

		2007 2008 2009		2010	2011		2012 2013		2014 2015 2016 Total
No of new portfolio companies	12	16	12	18	16	15	9	7	4	1	110
No of exits during the year				4		4	11	9	9		37
No of companies acquired in the year that are now fully exited	7	9	6	6	4	3	2				37

March 31, 2016

• Total exposure to private equity fund investments: 66% of total equity
• Private equity fund investments: 55% of total equity
• Number of full exits since inception: 37
• Average gross IRR generated by the 37 full exits since inception: 23%

Portfolio composition/diversification As of March 31, 2015, NAXS provided the following exposure:

8 buyout funds from 6 managers

Fund	Commitment Year	Commitment Currency	Initial Commitment Amount (in 000s)
Apax Europe VII LP	2007	EUR	15,000
FSN Capital III LP	2008	EUR	10,000
Herkules Private Equity Fund III LP	2008	NOK	40,000
Intera Fund I KY	2007	EUR	7,000
Intera Fund II KY	2011	EUR	7,250
Nordic Capital Fund VII LP	2008	EUR	20,000
Valedo Partners Fund I AB	2007	SEK	60,000
Valedo Partners Fund II AB	2011	SEK	65,000

3 different fund vintages and a diversification in terms of size segments, with small cap being the largest, as illustrated below (based on current commitments):

73 portfolio companies (remaining after 37 exits) acquired over a period of approx. 9 years, with the 10 largest holdings accounting for less than 29% of the total equity and no single portfolio company accounting for more than 8% of the total equity.

a diversification per geography and sector as illustrated below (based on the fair value of the current portfolio companies):

Underlying funds

Summary information regarding NAXS' underlying funds is provided below:

Fund	Fund size	Segment	Vintage	Geographic focus	# of portfolio companies	# of exited portfolio companies
Valedo I	MSEK 1,000	small cap	2007	Sweden	4	5
Intera I	MEUR 125	small cap	2007	Finland	4	3
Apax VII	MEUR 11,000	large cap	2008	Europe/Global	19	16
FSN III	MEUR 375	mid cap	2008	Norway/Nordic	5	5
Herkules III	MNOK 6,000	mid cap	2008	Norway/Nordic	7	4
Nordic Capital VII	MEUR 4,300	mid/large cap	2008	Primarily Nordic	16	2
Intera II	MEUR 200	small cap	2011	Finland	11	1
Valedo II	MSEK 2,000	small cap	2011	Sweden	7	1

Group

Financial performance, January-March 2016

Operating profit/loss

The operating profit/loss amounted to KSEK 26,162 (23,648) for the first quarter. The operating profit/loss includes a change in value of private equity fund investments of KSEK 29,176 (26,652). The currency effects are included in the changes in value, and amounted to KSEK 4,447 (-12,321) for the first quarter. Operating expenses amounted to KSEK 3,014 (3,004).

January 1– March 31, 2016

Changes in value of private equity fund investments: KSEK 29,176, whereof currency effects on private equity fund investments KSEK 4,447.

Financial items

Financial items net totaled KSEK -969 (129) for the first quarter. Interest income amounted to KSEK - (108) and interest expenses on cash in banks -277 (-). Exchange rate profit/loss amounted to KSEK -692 (21).

Tax and net profit

The Group's profit/loss after financial items for the first quarter amounted to KSEK 25,193 (23,777). Income taxes amounted to KSEK 0 (0). Net profit/loss after tax amounted to KSEK 25,193 (23,777). Earnings per share were SEK 1.69 (1.60).

Investments, financing and liquidity

Private Equity Fund Investments

During the first quarter, net investments/repayments from private equity funds amounted to KSEK -3,053 (5,227). As of March 31, 2016, private equity fund investments amounted to KSEK 449,500 (568,319).

March 31, 2016

Private equity fund investments per share: SEK 30,23

Financing

The Group is financed with shareholders' equity. Shareholders' equity amounted to KSEK 810,673 (784,768) at the end of the first quarter, corresponding to SEK 54.52 (52.78) per share and an equity/asset ratio of 100 (100) percent.

March 31, 2016 Equity per share: SEK 54.52

Net cash

At the end of the first quarter, net cash amounted to KSEK 361,924 (350,970), which corresponds to SEK 24.34 (23.60) per share. During the first quarter, cash and cash equivalents were invested in interest-bearing instruments or held on interest-bearing bank accounts, in accordance with the Company's policy.

March 31, 2016 Net cash per share: SEK 24.34

Significant risks and uncertainty factors

Significant risks and uncertainty factors are described in the Annual Report 2015. There has been no significant change in relation to risks and uncertainty factors since the publication of the Annual Report.

Future prospects

NAXS expect the volatility that has prevailed during the first quarter of the year to continue to affect financial markets, as well as private equity activity in the short- to medium term.

Parent company

The parent company has not had any sales during the first quarter. The profit/loss after financial items amounted to KSEK -668 (-1,518). The net interest income amounted to KSEK -54 (191) and exchange rate profit/loss amounted to KSEK 281 (-666). Income tax amounted to KSEK 0 (0). The net profit/loss amounted to KSEK -668 (-1,518).

Organization

The Company's CEO is Lennart Svantesson. The board of directors consists of John D. Chapman (chairman), Tony Gardner-Hillman, Ramanan Raghavendran and Andrew Wignall.

The share

The NAXS share was initially listed on First North on May 14, 2007. Since June 8, 2010, the share is traded on NASDAQ Stockholm. The share trades under the designation "NAXS".

The number of outstanding shares in the Company at the beginning and at the end of the interim period was 14,869,552.

At the end of the interim period, the NAXS share price was SEK 49.80 and the total shareholders' equity per share was SEK 54.52. The Company's market capitalization was MSEK 743 and the number of shareholders was 757.

Evolution of the share price during Q1 2016

Accounting principles

The condensed consolidated financial statements have been established in accordance with the International Financial Reporting Standards (IFRS), as recognized by the EU. This report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Reporting legislation.

The accounting principles applied in this report are described in the Annual Report 2015. The Parent Company follows the Swedish Annual Reporting legislation and the Swedish Financial Reporting Board RFR 2 for legal entities, which provides that the IFRS principles shall apply.

Financial information Contact persons

Annual General Meeting: June 1, 2016 Interim Report (6 months): July 19, 2016 Interim Report (9 months): October 21, 2016

Ticker codes

NAXS SS in Bloomberg NAXS.ST in Reuters

Lennart Svantesson, CEO +46 73 311 00 11 lennart.svantesson@naxs.se

Gösta Lundgren, CFO +46 70 710 47 88 gosta.lundgren@naxs.se

NAXS Nordic Access Buyout Fund AB discloses the information provided herein pursuant to the Swedish Securities Markets Act. The report was submitted for publication at 8:30 CET on April 22, 2016.

This report is an in-house translation of the original report in Swedish

Interim Report Jan-March, 2016 Page 13 of 18

Stockholm, April 22, 2016

John D. Chapman Chairman

Tony Gardner-Hillman Director

Ramanan Raghavendran Director

Andrew Wignall Director

Lennart Svantesson Chief Executive Officer

This report has not been subject to review by the Company's auditors.

This report and other information are available on www.naxs.se

NAXS Nordic Access Buyout Fund AB (publ) Corp. Reg. No. 556712-2972 Grev Turegatan 10 114 46 Stockholm, Sweden Tel: +46 8 611 33 25, E-mail: info@naxs.se

Consolidated Income Statement

Amounts in SEK 000s

	2016	2015
	1/1-03/31	1/1-03/31
Change in value	29 176	26 652
Operating costs Note 1	-3 014	-3 004
Operating profit/loss	26 162	23 648
Net financial items	-969	129
Profit/loss after financial items	25 193	23 777
Income taxes	-	-
Net profit/loss	25 193	23 777
Earnings per share, SEK*	1,69	1,60
Average number of shares, 000s*	14 870	14 870
* Basic and diluted

Consolidated Statement of Comprehensive Income Amounts in SEK 000s

	2016	2015
	1/1-03/31	1/1-03/31
Net income	25 193	23 777
Other comprehensive income Items which will be reversed to the income statement
Exchange differences	712	-2 844
Total comprehensive income	25 905	20 933
Consolidated Balance Sheet Amounts in SEK 000s
	2016	2015
	03/31	12/31
Assets
Private equity fund investments	449 500	434 246
Total non-current assets	449 500	434 246
Other receivables	296	114
Cash and cash equivalents	361 924	350 970
Total current assets	362 220	351 084
Total assets	811 720	785 330
Equity	810 673	784 768
Current liabilities	1 047	562
Total equity and liabilities	811 720	785 330

Consolidated Net cash

Amounts in SEK 000s

	2016	2015
	03/31	12/31
Cash, bank and short-term investments	361 924	350 970
Total net cash	361 924	350 970

Consolidated Statement of Changes in Equity Amounts in SEK 000s

	2016	2015	2015
	1/1-03/31	1/1-12/31	1/1-03/31
Equity at the beginning or the year	784 768	751 319	751 319
Dividend	-	-34 200	-
Total comprehensive income for the period	25 905	67 649	20 933
Shareholder's equity at the end of the period	810 673	784 768	772 252

Consolidated Statement of cash flows analysis Amounts in SEK 000s

	2016	2015
	1/1-03/31	1/1-03/31
Profit/loss after financial items	25 193	23 777
Adjustment for non-cash items, etc.	-10 797	10 693
Income tax paid	-	-
Cash flow from operating activities before changes
in working capital	14 396	34 470
Cash flow changes in working capital	303	-1 014
Cash flow from operating activities	14 699	33 456
Acquisitions/disposals of private equity fund
investments, net	-3 053	5 227
Cash flow from investing activities	-3 053	5 227
Cash flow during the period	11 646	38 683
Cash and cash equivalents, beginning of the year *	350 970	167 447
Exchange-rate differences in cash and cash
equivalents	-692	21
Cash and cash equivalents at the end of the period	361 924	206 151

* Including short-term investments

Parent Company Income Statement

Amounts in SEK 000s

	2016	2015
	1/1-03/31	1/1-03/31
Operating costs	-895	-1 043
Operating profit/loss	-895	-1 043
Net financial items	227	-475
Profit /loss after financial items	-668	-1 518
Income taxes	-	-
Net profit/loss for the period	-668	-1 518

Parent Company Statement of Comprehensive Income Amounts in SEK 000s

Net profit/loss for the period -668	-1 518
Total comprehensive income for the -668	-1 518

Parent Company Balance Sheet

Amounts in SEK 000s

	2016	2015
	03/31	12/31
Assets
Shares in subsidiaries	481 802	481 802
Receivables on group companies	23 705	23 424
Total non-current assets	505 507	505 226
Other receivables	355	114
Cash and cash equivalents	228 293	229 087
Total current assets	228 648	229 201
Total assets	734 155	734 427
Equity	733 345	734 013
Current liabilities	810	414
Total equity and liabilities	734 155	734 427

Parent Company Statement of Changes in equity Amounts in SEK 000s

	2016	2015	2015
	1/1-03/31	1/1-12/31	1/1-03/31
Equity at the beginning of the year	724 013	606 456	606 456
Dividend	-	-34 200	-
Total comprehensive income for the period	-668	161 757	-1 518
Shareholder's equity at the end of the period	733 345	734 013	604 938

Note 1

Operating costs Amounts in SEK 000s

	2016	2015
	1/1-03/31	1/1-03/31
Fee to the investment advisor	-1 965	-1 864
Personnel expenses	-412	-414
Other operating costs	-636	-726
	-3 014	-3 004

No related party transaction occurred during the period, except for remunerations to the board members and the managing director.

Note 2

Financial assets and liabilities

NAXS' financial instruments consist of fund investments, cash and cash equivalents and accounts payable. Level 3 investments includes only the Company's publicly traded share of the fund holdings / securities of unlisted companies (in some cases, also listed companies). When observable prices are not available for these securities, the fund manager uses one or more valuation techniques (e.g. yield methods or income-based methods), or a combination of techniques, for which sufficient and reliable data are available. Within Level 3, the market approach generally uses earnings multiples of comparable companies, while the income-based approach generally uses the present value of estimated future cash flows, adjusted for liquidity, credit, market and/or other risk factors.

For NAXS, the book value of all financial assets and liabilities corresponds to fair value. All amounts are shown in the reported balance sheets.

Definitions

Cash & cash equivalents Cash, bank and short-term investments

Cash per share Cash & cash equivalents in relation to the number of shares

Commitment

The maximum amount that a limited partner agrees to invest in a fund

Current commitments

Acquisition cost for private equity fund investments, plus remaining commitments to private equity funds

Gross IRR

The internal rate of return generated annually at the underlying private equity funds' level, before the deduction of the management fees and carried interest

Net asset value

The fair value of total assets, less net debt (corresponds to equity)

Net cash/Net debt

Cash and cash equivalents, short-term investments and interest-bearing current and longterm receivables, less interest-bearing current and long-term liabilities

Private equity fund investments

Fair value of investments in private equity funds

Total assets

All assets and liabilities not included in net debt or net cash, which is the same as the balance sheet total, less asset items included in net debt or net cash and less non-interestbearing liabilities

Total exposure to private equity fund investments Private equity funds investments and remaining commitments to private equity funds