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Nolato B

Quarterly Report Oct 26, 2011

2950_10-q_2011-10-26_57875110-19f9-4f36-8862-3c41968c667a.pdf

Quarterly Report

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Nolato AB (publ) nine-month interim report 2011

Continued good development and strong financial position

Third quarter of 2011 in brief

  • ‒ Sales amounted to SEK 718 million (887)
  • ‒ Operating income (EBITA) was SEK 54 million (67)
  • ‒ Net income stood at SEK 36 million (47)
  • ‒ Earnings per share were SEK 1.37 (1.78)
  • ‒ Cash flow after investments was SEK 48 million (4), excluding acquisitions
  • First nine months of 2011 in brief
  • ‒ Sales amounted to SEK 2,243 million (2,511)
  • ‒ Operating income (EBITA) was SEK 151 million (199)
  • ‒ Earnings per share were SEK 3.76 (5.47)
  • ‒ Cash flow after investments was SEK 123 million (75), excluding acquisitions
Group highlights
Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions unless otherwise specified 2011 2010 2011 2010 12 months 2010
Net sales 718 887 2,243 2,511 3,107 3,375
Operating income (EBITDA) 1) 111 103 278 308 377 407
Operating income (EBITA) 2) 54 67 151 199 214 262
EBITA margin, % 7.5 7.6 6.7 7.9 6.9 7.8
Income after financial items 50 60 138 182 199 243
Net income 36 47 99 144 142 187
Earnings per share before and after dilution, SEK* 1.37 1.78 3.76 5.47 5.40 7.11
Adjusted earnings per share, SEK 3) * 1.44 1.83 3.95 5.63 5.69 7.37
Cash flow after investments, excl. acquisitions and disposals 48 4 123 75 278 230
Net investm. affecting cash flow, excl. acquisitions and disposals 32 28 87 97 130 140
Return on capital employed, % 15.0 18.6 15.0 18.4
Return on shareholders' equity, % 12.7 18.6 12.7 16.5
Equity/assets ratio, % 52 48 50
Net debt 66 199 34

*The company does not have any financial instrument programmes which involve any dilution in the number of shares.

1) Operating income (EBITDA): Earnings before interest, taxes, depreciation and amortisation.

2) Operating income (EBITA): Earnings before interest, taxes and amortisation of intangible assets arising from acquisitions.

3) Adjusted earnings per share: Net income, excluding amortisation of intangibles assets arising from acquisitions, divided by the average number of shares.

Third quarter 2011

  • Sales amounted to SEK 718 million (887)
  • Strong development for Nolato Industrial
  • Continuing weak volumes within Nolato Telecom
  • Expansion of Nolato Medical's plant in Hungary
  • Operating income (EBITA) was SEK 54 million (67)

Sales

The Group's sales totalled SEK 718 million (887), representing a 19% drop compared with the corresponding period during the previous year. Currency effects had a negative impact on sales of around 3%.

Nolato Medical saw sales increase by 9% to SEK 220 million (202). Organic growth amounted to 7% excluding currency effects. Including currency conversion effects, sales rose organically by 4%. Volumes were healthy and in line with market growth. In order to facilitate further expansion within Nolato Medical, it was decided to extend the production plant in Hungary by 3,500 m2 .

Nolato Telecom's sales halved to SEK 220 million (444), including the resale of components (touch screens) of approx. SEK 5 million (60). Excluding currency conversion effects, sales fell by 47%. Demand for the existing product portfolio remains weak.

Nolato Industrial's sales rose by 16% to SEK 279 million (241). Excluding currency conversion effects, sales increased by 17%. Demand has been strong and increased within most customer segments.

Income

The Group's operating income (EBITA) was SEK 54 million (67).

Nolato Medical's operating income (EBITA) was SEK 25 million (25), Nolato Telecom's was SEK 7 million (32) and Nolato Industrial's was SEK 26 million (21).

Nolato Medical's EBITA margin was 11.4% (12.4). The margin was affected by further initiatives within projects and technology. Nolato Telecom's EBITA margin was 3.2% (7.2) and is explained by low capacity utilisation. Excluding lump sums the EBITA margin was 2.3% (7.2). Nolato Industrial's EBITA margin was a healthy 9.3% (8.7). Strong demand within most customer segments and a high level of capacity utilisation contributed to the strong margin. Collectively, the Group's EBITA margin was 7.5% (7.6).

Sales, operating income (EBITA) and EBITA margin by business area

Sales Sales Operating inc. Operating inc. EBITA margin EBITA margin
Q3/2011 Q3/2010 EBITA Q3/2011 EBITA Q3/2010 Q3/2011 Q3/2010
220 202 25 25 11.4% 12.4%
220 444 7 32 3.2% 7.2%
279 241 26 21 9.3% 8.7%
– 1 – 4 – 11
718 887 54 67 7.5% 7.6%

Operating income (EBITA): Earnings before interest, taxes and amortisation of intangible assets arising from acquisitions.

Currency effects (transaction and conversion effects) affected income by SEK -1 million (-1).

Operating income (EBIT) was SEK 51 million (65). During the quarter, a dividend was received from a previous bankruptcy of SEK 27 million, which is recognised under other operating income. Amortisation of production equipment of SEK 25 was implemented during the quarter and is recognised under extra amortisation costs. The amortisation is related to equipment within Nolato Telecom caused by technology shift. The lump sum of these two amounts to SEK +2 million (0) and both relates to Nolato Telecom.

Income after financial items was SEK 50 million (60). Net financial items included SEK +2 million (-3) in currency exchange rate difference effects during the third quarter.

Net income was SEK 36 million (47). Earnings per share, before and after dilution, stood at SEK 1.37 (1.78). Adjusted earnings per share excluding amortisation of intangible assets arising from acquisitions were SEK 1.44 (1.83).

First nine months 2011

Sales and earnings

The Group's sales during the first nine months of 2011 totalled SEK 2,243 million (2,511), which was 11% lower than during the corresponding period of the previous year. Currency effects had a negative impact on sales of 5%.

Nolato Medical's sales rose by 20% to SEK 687 million (573), Nolato Telecom's sales fell by 39% to SEK 728 million (1,198), while Nolato Industrial's sales increased by 12% to SEK 830 million (741).

The Group's operating income (EBITA) amounted to SEK 151 million (199), whilst the EBITA margin was 6.7% (7.9). Operating income (EBIT) was SEK 144 million (193).

Income after financial items was SEK 138 million (182). Net financial items include currency exchange rate effects of SEK 1 million (-4).

Net income was SEK 99 million (144). Earnings per share, both before and after dilution, were SEK 3.76 (5.47). Adjusted earnings per share excluding amortisation of intangible assets arising from acquisitions were SEK 3.95 (5.63). The effective tax rate was 28% (21). The higher tax rate was the result of changes in earnings between countries in which the Group is active.

The return on capital employed for the last twelve months was 15.0% (18.4% for the 2010 calendar year). The return on operating capital for the last twelve months was 16.2% (21.6% for the 2010 calendar year).

Nolato Medical

Sales and income Q1-Q3 (SEK millions) 2011 2010
Sales 687 573
Operating income (EBITA) 82 72
EBITA margin (%) 11.9 12.6
Operating income (EBIT) 77 68

Nolato Medical saw sales grow to SEK 687 million (573), which corresponds to an increase of 20%. Organic growth amounted to 9% excluding currency conversion effects. The trend in volumes was good for most of the business area's customer segments and the business has developed well in line with the growth in the market.

Operating income (EBITA) rose to SEK 82 million (72). The EBITA margin was 11.9% (12.6). Compared with the previous year, the margin was negatively affected by the acquired unit in the USA. As a result of a high level of market activity, Nolato Medical has decided to continue the initiatives within projects and technology, which has also resulted in a slight reduction in the margin. The level of activity in the business area's projects has been very high over the past twelve months. Nolato expects sales from project activity to decline during the forthcoming quarters.

Nolato Medical has approved an extension to the factory in Hungary in order to facilitate future expansion. A further 3,500 m2 will be completed, enabling the gradual commencement of production from 2013 onwards. This extension will provide additional clean room capacity, amongst other things. The investment cost is estimated at around SEK 30 million.

Nolato Medical's american business entity has developed positively and according to plan and now also offers silicon production to medical customers in North America.

Nolato Telecom

Sales and income Q1-Q3 (SEK millions) 2011 2010
Sales 728 1,198
Operating income (EBITA) 7 98
EBITA margin (%) 1.0 8.2
Operating income (EBIT) 7 98

Nolato Telecom's sales fell by 39% to SEK 728 million (1,198), which includes the resale of components (touch screens) of approximately SEK 95 million (120). Excluding currency conversion effects, sales fell by 33%. After a strong start to the year, demand for the existing product portfolio fell markedly. The start-up of a number of new projects was either deferred or cancelled, partly due to a shortage of electronic components as a result of the natural disasters in Japan. Demand for the existing product portfolio remained weak during the third quarter.

Operating income (EBITA) fell to SEK 7 million (98). Income was affected by non-recurring items amounting to SEK +2 million net. The EBITA margin was 1.0% (8.2). Low volumes have resulted in very weak profitability.

Nolato Industrial

Sales and income Q1-Q3 (SEK millions) 2011 2010
Sales 830 741
Operating income (EBITA) 78 61
EBITA margin (%) 9.4 8.2
Operating income (EBIT) 76 59

Nolato Industrial's sales rose by 12% to SEK 830 million (741). Strong demand, advanced market positions and new products contributed to an increase in sales. Excluding currency conversion effects, sales rose by 14%.

Operating income (EBITA) was SEK 78 million (61), with a strong EBITA margin of 9.4% (8.2). A high level of capacity utilisation has positively affected the margin.

As previously stated, the business area has established a small production unit in Romania. Production is progressing according to plan.

Cash flow before investments totalled SEK 210 million (172) and was positively affected by the dividend from a previous bankruptcy. The change in working capital was a negative SEK 11 million (-69). Cash flow after investments was SEK 123 million (75, excluding acquisitions). Net investments affecting cash flow totalled SEK 87 million (97, excluding acquisitions).

Interest-bearing assets totalled SEK 153 million (131) and interest-bearing liabilities and provisions totalled SEK 219 million (330). Net debt thus totalled SEK 66 million (199). Equity amounted to SEK 1,118 million (1,133). The equity/assets ratio was 52% (48). During the second quarter, dividends totalling SEK 158 million (79) were paid to shareholders.

Financial position Excluding acquisitions and disposals

Cash flow after investments first nine months

Excluding acquisitions and disposals

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 2011 2010 12 months 2010
Net sales 718 887 2,243 2,511 3,107 3,375
Gross income excl. depreciation/amortisation 131 157 395 477 545 627
As a percentage of net sales 18.2 17.7 17.6 19.0 17.5 18.6
Costs – 20 – 54 – 117 – 169 – 168 – 220
As a percentage of net sales 2.8 6.1 5.2 6.7 5.4 6.5
Operating income (EBITDA) 111 103 278 308 377 407
As a percentage of net sales 15.5 11.6 12.4 12.3 12.1 12.1
Depreciation and amortisation – 57 – 36 – 127 – 109 – 163 – 145
Operating income (EBITA) 54 67 151 199 214 262
As a percentage of net sales 7.5 7.6 6.7 7.9 6.9 7.8
Amortisation of intang. assets arising from acquisitions – 3 – 2 – 7 – 6 – 10 – 9
Operating income (EBIT) 51 65 144 193 204 253
Financial items – 1 – 5 – 6 – 11 – 5 – 10
Income after financial items 50 60 138 182 199 243
Tax – 14 – 13 – 39 – 38 – 57 – 56
As a percentage of income after financial items 28.0 21.7 28.3 20.9 28.6 23.0
Net income 36 47 99 144 142 187

Consolidated performance analysis

Financial position

SEK millions 30/09/2011 30/09/2010 31/12/2010
Interest-bearing liabilities, credit institutions 126 238 180
Interest-bearing pension liabilities 93 92 93
Total borrowings 219 330 273
Cash and bank – 153 – 131 – 239
Net debt 66 199 34
Working capital 125 252 145
As a percentage of sales (avg.) (%) 6.1 5.7 4.1
Capital employed 1,338 1,463 1,452
Return on capital employed (avg.) (%) 15.0 18.6 18.4
Shareholders' equity 1,118 1,133 1,179
Return on shareholders' equity (avg.) (%) 12.7 18.6 16.5

The tax situation in China

With effect from 2011 onwards, China has introduced new taxes and duties for foreign companies which are expected to increase Nolato's tax cost by around SEK 5 – 10 million annually. During the period 2008 - 2010, Nolato enjoyed a tax rate of 15% in China as a result of its "High-Tech Status". The application process for this status for the period 2011 - 2013 is currently under way and notification is anticipated during the fourth quarter. The tax rate for the first nine months has been determined assuming that Nolato will continue to be accorded "High-Tech Status" (15% tax rate in China), but with a supplement for the new non-profit based taxes from 2011 onwards.

Personnel

The average number of employees during the period was 5,684 (7,616). The reduction in the number of employees is attributable to Nolato Telecom in China and arose as a result of lower volumes.

Significant risks and uncertainty factors

The business risks and risk management of the Group and the Parent Company, along with the management of financial risks, are described in the 2010 Annual Report on pages 32 – 33 and in Note 4 on pages 49 – 50.

No significant events have occurred during the period which would significantly affect or change these descriptions of the Group and the Parent Company's risks or the management thereof.

Events after the balance sheet date

No significant events have occurred since the end of the period.

Ownership and legal structure

Nolato AB (publ), Swedish corporate identity number 556080-4592, is the Parent Company of the Nolato Group.

Nolato's B shares have been listed on the NASDAQ OMX Nordic Exchange in the Stockholm Mid Cap segment since 1 January 2011, where they are included under the information technology sector.

The number of shareholders was 7,712 as of 30 September. The largest shareholders were the Paulsson family with 12%, the Jorlén family with 10%, the Boström family with 10%, Lannebo Fonder with 10%, Svolder with 5% and Skandia Fonder with 4% of the share capital. The ten largest shareholders hold 61% of the capital and 80% of the votes.

The Parent Company

Sales totalled SEK 20 million (18). The increase in sales is a result of higher costs levied on subsidiaries. Income after financial items amounted to SEK 145 million (44). The improved result is primarily the result of higher dividends from subsidiaries.

Accounting and valuation principles Contact:

Nolato's consolidated accounts have been prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by the EU.

The consolidated accounts have been prepared in accordance with the same principles as those applied to the Annual Report, which are described in the 2010 Annual Report on pages 45–48.

The consolidated year-end report has been prepared in accordance with IAS 34 (Interim Financial Reporting). The applicable provisions of the Swedish Annual Accounts Act and the Swedish Securities Market Act have also been applied.

The Parent Company year-end report has been prepared in accordance with the Swedish Annual Accounts Act and the Swedish Securities Market Act, in line with the provisions of RFR 2, Accounting for Legal Entities.

The new or revised IFRS standards or IFRIC interpretations that entered into force on 1 January 2011 have not had any material effect on the Group's income statements or balance sheets.

Nomination Committee

auditors. It was resolved at Nolato's Annual General Meeting on 27 April 2011 that the Company should have a Nomination Committee consisting of one representative for each of the five largest shareholders in terms of number of votes as at the end of September.

Following discussions with the five largest shareholders, the following have been elected to Nolato's Nomination Committee ahead of the 2012 Annual General Meeting:

  • Henrik Jorlén, chairman, representing the Jorlén family
  • Gun Boström, representing the Boström family
  • Erik Paulsson, representing the Paulsson family
  • Johan Lannebo, representing Lannebo Fonder
  • Magnus Molin, representing Svolder

Annual General Meeting

The Annual General Meeting will be held on 24 April 2012. Shareholders wishing to submit proposals to the nomination committee should contact the nomination committee's chairman Henrik Jorlén, by e-mail to [email protected] or by ordinary mail to Kommendörsgatan 4, 269 77 Torekov, Sweden.

Financial calendar

  • 2011 year-end report: 1 February 2012
  • Three-month interim report 2012: 24 April 2012
  • 2012 Annual General Meeting: 24 April 2012
  • Six-month interim report 2012: 20 July 2012
  • Nine-month interim report 2012: 24 October 2012

Torekov, 26 October 2011 Nolato AB (publ) Hans Porat, President and CEO

  • Hans Porat, President and CEO, phone +46431 442294.
  • Per-Ola Holmström, CFO, phone +46431 442293.

The information contained in this interim report is the information which Nolato must make public in accordance with the Swedish Securities Market Act and/or the Swedish Financial Instruments Trading Act. This information was made public on 26 October 2011 at 14:30 pm.

This report has not been reviewed by the Company's

Consolidated income statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 2011 2010 12 months 2010
Net sales 718 887 2,243 2,511 3,107 3,375
Cost of goods sold – 647 – 764 – 1,972 – 2,139 – 2,722 – 2,889
Gross profit 71 123 271 372 385 486
Other operating income 29 0 34 1 38 5
Selling expenses – 16 – 18 – 52 – 55 – 73 – 76
Administrative expenses – 33 – 40 – 109 – 122 – 147 – 160
Other operating expenses 0 0 0 – 3 1 – 2
– 20 – 58 – 127 – 179 – 181 – 233
Operating income 51 65 144 193 204 253
Financial items – 1 – 5 – 6 – 11 – 5 – 10
Income after financial items 50 60 138 182 199 243
Tax – 14 – 13 – 39 – 38 – 57 – 56
Net income 36 47 99 144 142 187
All earnings are attrib. to the Parent Co.'s shareholders
Depreciation/amortisation 60 38 134 115 173 154
Earnings per share before and after dilution (SEK) 1.37 1.78 3.76 5.47 5.40 7.11
Number of shares at the end of the period 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408
Average number of shares 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408

Consolidated comprehensive income (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
2011 2010 2011 2010 12 months 2010
36 47 99 144 142 187
19 – 44 – 1 – 23 5 – 17
0 7 – 1 7 – 6 2
0 – 2 0 – 2 2 0
19 – 39 – 2 – 18 1 – 15
55 8 97 126 143 172

Reconciliation of consolidated income before tax

Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 12 months 2010
Operating income (EBIT)
Nolato Medical 77 68 103 94
Nolato Telecom 7 98 31 122
Nolato Industrial 76 59 93 76
Group adjustments, Parent Company – 16 – 32 – 23 – 39
Consolidated operating income (EBIT) 144 193 204 253
Financial items (not distributed by business areas when no follow-up by management) – 6 – 11 – 5 – 10
Consolidated income before tax 138 182 199 243

Consolidated balance sheet (summary)

SEK millions 30/09/2011 30/09/2010 31/12/2010
Assets
Fixed assets
Intangible fixed assets 434 442 441
Tangible fixed assets 689 723 718
Other securities held as fixed assets 2 2 2
Other long-term receivables 1 1 1
Deferred tax assets 39 29 30
Total fixed assets 1,165 1,197 1,192
Current assets
Inventories 229 251 222
Accounts receivable 508 674 616
Other current assets 81 102 81
Cash and bank 153 131 239
Total current assets 971 1,158 1,158
Total assets 2,136 2,355 2,350
Shareholders' equity and liabilities
Shareholders' equity 1,118 1,133 1,179
Long-term liabilities and provisions 1) 98 96 94
Deferred tax liabilities 1) 101 104 109
Short-term liabilities and provisions 1) 819 1,022 968
Total liabilities and provisions 1,018 1,222 1,171
Total shareholders' equity and liabilities 2,136 2,355 2,350
1) Interest-bearing/non-interest-bearing liabilities and provisions:
Interest-bearing liabilities and provisions 219 330 273
Non-interest-bearing liabilities and provisions 799 892 898
Total liabilities and provisions 1,018 1,222 1,171

Changes in consolidated shareholders' equity (summary)

Q1 - Q3 Q1 - Q3 Full year
SEK millions 2011 2010 2010
Shareholders' equity at the beginning of the period 1,179 1,086 1,086
Total comprehensive income for the period 97 126 172
Dividends – 158 – 79 – 79
Shareholders' equity at the end of period attrib. to Parent Co's shareholders 1,118 1,133 1,179

During 2011, a dividend totalling SEK 158 million was paid to the Parent Company's shareholders, corresponding to an ordinary of SEK 3.00 and extra of SEK 3.00, totalling SEK 6.00 per share. The Group does not have any incentive programmes resulting in a dilutive effect.

Consolidated cash flow statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 2011 2010 12 months 2010
Cash flow from op. activities bef. changes in work. cap. 100 75 221 241 320 340
Changes in working capital – 20 – 43 – 11 – 69 88 30
Cash flow from operations 80 32 210 172 408 370
Cash flow from investment activities – 32 – 192 – 87 – 261 – 112 – 286
Cash flow before financing activities 48 – 160 123 – 89 296 84
Cash flow from financing activities – 39 116 – 209 53 – 272 – 10
Cash flow for the period 9 – 44 – 86 – 36 24 74
Liquid funds at the beginning of the period 139 186 239 172 172
Exchange rate difference in liquid funds 5 – 11 0 – 5 – 7
Liquid funds at the end of the period 153 131 153 131 239

Earnings per share

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 2011 2010 12 months 2010
Net income 36 47 99 144 142 187
Adjusted earnings:
Amortisation of intangible assets arising from acquis. 3 2 7 6 10 9
Tax on amortisation – 1 – 1 – 2 – 2 – 2 – 2
Adjusted earnings 38 48 104 148 150 194
Average number of shares * 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408 26,307,408
Earnings per share before and after dilution (SEK) * 1.37 1.78 3.76 5.47 5.40 7.11
Adjusted earnings per share (SEK) * 1.44 1.83 3.95 5.63 5.69 7.37

* The company does not have any ongoing financial instrument programmes which involve any dilution in the number of shares.

Five-year overview

2010 2009 2008 2007 2006
Net sales (SEK millions) 3,375 2,602 2,824 2,421 2,702
Operating income (EBITA) (SEK millions) 262 166 240 197 79
EBITA margin (%) 7.8 6.4 8.5 8.1 2.9
Operating income (EBIT) (SEK millions) 253 158 232 190 78
Income after financial items (SEK millions) 243 148 216 171 69
Net income (SEK millions) 187 123 178 150 48
Cash flow after investments, excl. acq. and disposals (SEK millions) 230 139 296 227 142
Return on capital employed (%) 18.4 12.1 18.4 16.3 7.4
Return on shareholders' equity (%) 16.5 11.5 18.4 18.0 5.9
Net debt (SEK millions) 34 40 95 314 162
Equity/assets ratio (%) 50 51 50 46 46
Earnings per share (SEK) 7.11 4.68 6.77 5.70 1.82
Adjusted earnings per share (SEK) 7.37 4.90 6.99 5.32 6.08
Average number of employees 7,563 4,308 4,531 3,760 4,144

Quarterly data (summary)

Q1 Q2 Q3 Q4 Full year
Net sales (SEK millions) 2011 759 766 718
2010 746 878 887 864 3,375
2009 606 557 653 786 2,602
Operating income (EBITDA) (SEK millions) 2011 79 88 111
2010 100 105 103 99 407
2009 56 77 84 126 343
Operating income (EBITA) (SEK millions) 2011 44 53 54
2010 63 69 67 63 262
2009 16 39 48 63 166
EBITA margin (%) 2011 5.8 6.9 7.5
2010 8.4 7.9 7.6 7.3 7.8
2009 2.6 7.0 7.4 8.0 6.4
Operating income (EBIT) (SEK millions) 2011 42 51 51
2010 61 67 65 60 253
2009 14 37 46 61 158
Income after financial items (SEK millions) 2011 38 50 50
2010 57 65 60 61 243
2009 6 42 42 58 148
Net income (SEK millions) 2011 28 35 36
2010 45 52 47 43 187
2009 4 29 33 57 123
Cash flow after inv., excl. acq. and disp. (SEK millions) 2011 111 – 36 48
2010 0 71 4 155 230
2009 56 35 – 31 79 139
Earnings per share before and after dilution (SEK) 2011 1.06 1.33 1.37
2010 1.71 1.98 1.78 1.64 7.11
2009 0.15 1.10 1.26 2.17 4.68
Adjusted earnings per share (SEK) 2011 1.10 1.41 1.44
2010 1.79 2.01 1.83 1.74 7.37
2009 0.23 1.14 1.29 2.24 4.90
Shareholders' equity per share (SEK) 2011 45 40 42
2010 43 43 43 45 45
2009 41 39 39 41 41
Return on total capital (%) 2011 10.9 10.0 9.4
2010 10.2 11.3 11.5 11.3 11.3
2009 9.4 8.8 7.1 7.5 7.5
Return on capital employed (%) 2011 17.6 16.4 15.0
2010 16.1 18.4 18.6 18.4 18.4
2009 14.7 13.7 11.3 12.1 12.1
Return on operating capital (%) 2011 20.6 18.6 16.2
2010 18.0 20.8 20.5 21.6 21.6
2009 16.5 14.4 12.7 13.9 13.9
Return on shareholders' equity (%) 2011 14.6 14.0 12.7
2010 14.9 17.5 18.6 16.5 16.5
2009 14.2 13.0 11.2 11.5 11.5

Quarterly data business areas

Net sales (SEK millions) Q1 Q2 Q3 Q4 Full year
Nolato Medical 2011 232 235 220
2010 186 185 202 235 808
2009 178 177 159 178 692
Nolato Telecom 2011 259 249 220
2010 320 434 444 377 1,575
2009 226 183 309 372 1,090
Nolato Industrial 2011 268 283 279
2010 241 259 241 253 994
2009 206 197 185 236 824
Group adjustments, Parent Company 2011
2010

– 1
– 1
– 1

– 1

– 2
2009 – 4 – 4
Group total 2011 759 766 718
2010 746 878 887 864 3,375
2009 606 557 653 786 2,602
Operating income (EBITA) (SEK millions) Q1 Q2 Q3 Q4 Full year
Nolato Medical 2011 28 29 25
EBITA-margin (%) 12.1 12.3 11.4
2010 23 24 25 28 100
EBITA-margin (%) 12.4 13.0 12.4 11.9 12.4
2009 24 23 20 22 89
EBITA-margin (%) 13.5 13.0 12.6 12.4 12.9
Nolato Telecom 2011 – 4 4 7
EBITA-margin (%) – 1.5 1.6 3.2
2010 32 34 32 24 122
EBITA-margin (%) 10.0 7.8 7.2 6.4 7.7
2009 0 32 24 30 86
EBITA-margin (%) 0.0 17.5 7.8 8.1 7.9
Nolato Industrial 2011 25 27 26
EBITA-margin (%) 9.3 9.5 9.3
2010 17 23 21 18 79
EBITA-margin (%) 7.1 8.9 8.7 7.1 7.9
2009 – 1 – 7 9 18 19
EBITA-margin (%) – 0.5 – 3.6 4.9 7.6 2.3
Group adjustments, Parent Company 2011
2010
– 5
– 9
– 7
– 12
– 4
– 11

– 7

– 39
2009 – 7 – 9 – 5 – 7 – 28
Group total 2011 44 53 54
EBITA-margin (%) 5.8 6.9 7.5
2010 63 69 67 63 262
EBITA-margin (%) 8.4 7.9 7.6 7.3 7.8
2009 16 39 48 63 166
EBITA-margin (%) 2.6 7.0 7.4 8.0 6.4
Depreciation/amortisation (SEK millions) Q1 Q2 Q3 Q4 Full year
Nolato Medical 2011 14 16 14
2010 12 12 13 16 53
2009 11 11 11 12 45
Nolato Telecom 2011 13 10 35
2010 16 14 14 13 57
2009 18 16 15 40 89
Nolato Industrial 2011 10 11 11
2010 11 12 11 10 44
2009 13 13 12 13 51
Group total 2011 37 37 60
2010 39 38 38 39 154
2009 42 40 38 65 185

Group financial highlights

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
2011 2010 2011 2010 12 months 2010
Net sales (SEK millions) 718 887 2,243 2,511 3,107 3,375
Sales growth (%) – 19 36 – 11 38 – 6 30
Percentage of sales outside Sweden (%) 74 80 73 77 72 76
Operating income (EBITDA) (SEK millions) 111 103 278 308 377 407
Operating income (EBITA) (SEK millions) 54 67 151 199 214 262
EBITA margin (%) 7.5 7.6 6.7 7.9 6.9 7.8
Income after financial items (SEK millions) 50 60 138 182 199 243
Profit margin (%) 7.0 6.8 6.2 7.2 6.4 7.2
Net income (SEK millions) 36 47 99 144 142 187
Return on total capital (%) 10.0 11.5 10.0 11.3
Return on capital employed (%) 16.4 18.6 16.4 18.4
Return on operating capital (%) 18.6 20.5 18.6 21.6
Return on shareholders' equity (%) 14.0 18.6 14.0 16.5
Equity/assets ratio (%) 52 48 50
Debt/equity (%) 20 29 23
Interest coverage ratio (times) 17 21 17 24 18 25
Net investments affecting cash flow, excl. acq. and disposals 32 28 87 97 130 140
(SEK millions)
Cash flow after investments, excl. acq. and disposals (SEK millions) 48 4 123 75 278 230
Net debt (SEK millions) 66 199 34
Earnings per share before and after dilution (SEK) 1.37 1.78 3.76 5.47 5.40 7.11
Adjusted earnings per share (SEK) 1.44 1.83 3.95 5.63 5.69 7.37
Cash flow per share, excl. acq. and disposals (SEK) 1.82 0.15 4.68 2.85 10.57 8.74
Shareholders' equity per share (SEK) 42 43 45
Average number of employees 5,684 7,616 7,563

Definitions

Return on total capital Earnings per share

Income after financial items plus financial expenses as a percentage of average total capital in the balance sheet.

Return on capital employed

expenses. Income after financial items plus financial expenses as a percentage of average capital employed. Capital employed consists of total capital less non-interest-bearing liabilities and provisions. Earnings before interest, taxes and depreciation/amortisation.

Return on operating capital Operating income (EBITA)

Operating income as a percentage of average operating capital. Operating capital consists of total capital less non-interest-bearing liabilities and provisions, less interest-bearing assets.

Return on shareholders' equity

Net income as a percentage of average shareholders' equity.

EBITA margin

Operating income (EBITA) as a percentage of net sales.

Adjusted earnings per share

Net income, excluding amortisation of intangible assets arising from acquisitions, divided by the average number of shares. Income after financial items as a percentage of net sales.

Cash flow per share

Cash flow from operations, divided by average number of shares.

Net debt

Interest-bearing liabilities and provisions less interest-bearing assets.

Net income, divided by average number of shares.

Interest coverage ratio

Income after financial items plus financial expenses, divided by financial

Operating income (EBITDA)

Earnings before interest, taxes and amortisation of intangible assets arising from acquisitions.

Operating income (EBIT)

Income before tax, financial income and expenses.

Debt/equity ratio

Equity/assets ratio Interest-bearing liabilities and provisions divided by shareholders' equity.

Shareholders' equity as a percentage of total capital in the balance sheet.

Profit margin

Parent Company income statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK millions 2011 2010 2011 2010 12 months 2010
Net sales 7 6 20 18 25 23
Other operating income 1 0 5 0 9 4
Selling expenses – 2 – 3 – 7 – 9 – 13 – 15
Administrative expenses – 8 – 10 – 29 – 37 – 35 – 43
Operating income – 2 – 7 – 11 – 28 – 14 – 31
Result from shares in Group companies 28 53 153 74 178 99
Financial income 4 3 9 7 11 9
Financial expenses – 4 – 6 – 6 – 9 – 1 – 4
Income after financial items 26 43 145 44 174 73
Appropriations – 32 – 32
Tax 2 3 4 9 9 14
Net income 28 46 149 53 151 55
Depreciation/amortisation 0 0 0 0 0 0

Parent Company balance sheet (summary)

SEK millions 30/09/2011 30/09/2010 31/12/2010
Assets
Tangible fixed assets 1 0 0
Financial fixed assets 792 943 877
Deferred tax assets 10 5 6
Total fixed assets 803 948 883
Other receivables 362 89 251
Cash and bank 37 7 105
Total current assets 399 96 356
Total assets 1,202 1,044 1,239
Shareholders' equity and liabilities
Shareholders' equity 826 733 837
Untaxed reserves 125 93 125
Other provisions 4 5 2
Long-term liabilities 17 17 17
Current liabilities 230 196 258
Total shareholders' equity and liabilities 1,202 1,044 1,239
Collateral pledged
Contingent liabilities 99 92 92
Transactions with related parties:
Related party Period Services Services Interest Interest Res. from shares Rec. fr. rel. part. Liab. to rel. part.
sold bought income expenses in Group comp. on bal. sh. date on bal. sh. date
Subsidiary Jan-Sep 2011 20 – 8 7 – 1 153 632 177
Subsidiary Jan-Sep 2010 18 – 11 7 0 74 270 133

None of the company's Board members or senior executives currently has, or has previously had, any direct or indirect involvement in any business transaction with the company which is, or was, of an unusual character in terms of its conditions. Nor has the Group issued any loans, pledged any guarantees or entered into any surety arrangements for any of the company's Board members or senior executives.

Nolato AB, SE-269 04 Torekov, Sweden • Tel. +46 431 442290 • Fax +46 431 442291 Corp. id. number 556080-4592 • E-mail [email protected] • Website www.nolato.com

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