AI Terminal

MODULE: AI_ANALYST
Interactive Q&A, Risk Assessment, Summarization
MODULE: DATA_EXTRACT
Excel Export, XBRL Parsing, Table Digitization
MODULE: PEER_COMP
Sector Benchmarking, Sentiment Analysis
SYSTEM ACCESS LOCKED
Authenticate / Register Log In

Nolato B

Quarterly Report Oct 27, 2022

2950_10-q_2022-10-27_8221d307-948b-47d2-a1e1-9a3114c2ffb0.pdf

Quarterly Report

Open in Viewer

Opens in native device viewer

INTERIM REPORT 2022 January - September

Continued challenging operating environment

Third quarter of 2022 in brief

  • Sales totaled SEK 2,626 million (3,033)
  • Operating profit (EBITA) was SEK 214 million (339)
  • EBITA margin of 8.1% (11.2)
  • Profit after tax was SEK 160 million (257)
  • Diluted earnings per share were SEK 0.59 (0.95)
  • Cash flow after investments increased to SEK 166 million (116)

First nine months of 2022 in brief

  • Sales totaled SEK 8,410 million (8,464)
  • Operating profit (EBITA) was SEK 745 million (SEK 983 million excl. non-recurring item)
  • EBITA margin of 8.9% (11.6%, excl. non-recurring item)
  • Diluted earnings per share were SEK 2.05 (SEK 2.70 excl. non-recurring item)
  • Cash flow after investments amounted to SEK 143 million (533)
  • Sustained strong financial position

Comments from the President and CEO - Continued

challenging operating environment and lower VHP volumes

The challenging operating environment is continuing to impact the Group's performance, through inflationary effects with higher manufacturing costs for materials, energy and labor, as well as lower demand from Eastern Europe, which continues to be affected by Russia's invasion of Ukraine. Adjusted for currency, net sales decreased by 24% in the third quarter to SEK 2,626 million, with an EBITA margin of 8.1%.

Adjusted for currency, Medical Solutions sales increased by 13%, due primarily to the charging on of cost increases and healthy growth in the surgery segment. The EBITA margin decreased to

8.4%. This development was due to a change in the sales mix, a time lag in charging on higher manufacturing costs, and the capacity investments we made last year are not yet being fully utilized.

Adjusted for currency, Integrated Solutions sales decreased by some 60%, which was in line with what we previously communicated. The EBITA margin was 10.3% and was impacted by lower volumes. Demand for Vaporiser Heating Products (VHP) in Eastern Europe continues to be adversely affected following Russia's invasion of Ukraine.

Our interim report for the first quarter of this year explained that our customer in the VHP segment was assessing its sourcing strategy, and this has now led to us sharing the manufacture of new products. In addition, in October the Chinese authorities introduced new regulatory requirements for the manufacture of VHP products in China. The processing of licenses has been ongoing since spring 2022. Like several other companies, Nolato has not yet received any such license. We have consequently not manufactured VHP products in China in the current month (see also our press release of October 21). The EMC business is continuing to perform well. Nolato estimates this business area's total sales in the fourth quarter will be in the region of half a billion kronor.

Industrial Solutions volumes increased slightly. Organic growth, however, was 9%, due to the charging on of cost increases. Demand remains healthy but with some negative tendencies, particularly in the consumer discretionary segment. However, the EBITA margin decreased to 5.2% as a result of a continued component shortage, particularly in the automotive segment, leading to volatile production planning from the customers.

Overall, as a global strategic partner with a large number of customers and a strong financial position, we can look ahead with confidence, despite a range of external challenges.

SEK million unless otherwise specified Note Q3
2022
Q3
2021
Q1 - Q3
2022
Q1 - Q3
2021
Rolling
12 months
Full year
2021
Net sales 1 2,626 3,033 8,410 8,464 11,556 11,610
Operating profit (EBITDA) 343 450 1,115 1,356 1,564 1,805
Operating profit (EBITA) 214 339 745 1,033 1,081 1,369
EBITA margin, % 8.1 11.2 8.9 12.2 9.4 11.8
Operating profit (EBIT) 2 205 331 715 1,007 1,041 1,333
Profit after financial income and expense 2 197 322 689 968 1,122 1,401
Profit after tax 160 257 551 774 937 1,160
Basic earnings per share, SEK 3 0.59 0.96 2.05 2.89 3.48 4.32
Diluted earnings per share, SEK 3 0.59 0.95 2.05 2.88 3.48 4.32
Cash flow after investm., excl. acquis. and disposals 166 116 143 533 56 446
Net investm. affecting cash flow, excl. acq. and disp. 109 245 352 577 557 782
Cash conversion, % 5 35
Return on capital employed, % 16.7 20.6 16.7 22.8
Return on shareholders' equity, % 19.2 25.1 19.2 28.0
Equity/assets ratio, % 51 45 51 47
Net financial liabilities (−), excluding pension- & lease
liabilities – 580 – 72 – 580 – 51

Group highlights

See definitions of IFRS measures and alternative performance measures on page 22.

Including a non-recurring item of SEK 50 million in operating profit and profit after tax in Q2 2021 and full year 2021 and SEK 115 million in profit after financial income and expense in Q4 2021 and full year 2021, which in total impacted profit after tax with SEK 165 million, for full year 2021.

This document is a translation from Swedish. In the event of any difference between this version and the Swedish original, the latter shall prevail.

Christer Wahlquist, President and CEO, Nolato AB

Third quarter 2022

  • Sales totaled SEK 2,626 million (3,033), which, adjusted for currency, was a decrease of 24%
  • Inflationary effects and lower volumes are having an adverse effect on earnings performance
  • Operating profit (EBITA) was SEK 214 million (339)
  • EBITA margin of 8.1% (11.2) Sales
  • Cash flow after investments amounted to SEK 166 million (116)

Sales

Consolidated sales totaled SEK 2,626 million (3,033). Adjusted for currency, this was a decrease of 24%.

Medical Solutions sales amounted to SEK 1,245 million (977); adjusted for currency, sales increased by 13%. The charging on of higher costs contributed to the increase in sales. The surgery area saw good growth in the quarter, while in vitro diagnostics (IVD) volumes were low during the period due to pandemic-related inventory adjustments, which continued to affect the third quarter.

Integrated Solutions sales totaled SEK 745 million (1,519). Adjusted for currency, this was a decrease of some 60%. Demand for Vaporiser Heating Products (VHP) in Eastern Europe has been adversely affected following Russia's invasion of Ukraine. Nolato believes that the VHP segment will continue to be impacted by the situation in Eastern Europe and by the effects of dual sourcing. In addition, Nolato has not manufactured any VHP products in China in October because of new regulatory requirements relating to VHP products established by Chinese authorities. Licensing by a Chinese authority has been ongoing in 2022, but Nolato has not yet received the relevant license. The license did not affect the third quarter, as it applies to production as of October. See also our press release of 21 October. The EMC segment is continuing to perform well, with sales increasing to SEK 185 million (145). Nolato estimates this business area's total sales in the fourth quarter will be in the region of half a billion kronor.

Industrial Solutions sales amounted to SEK 638 million (540); adjusted for currency, sales increased by 9%. Volumes increased slightly from the same quarter last year, while the charging on of cost increases, in particular, contributed positively to sales. Demand remained healthy in most market areas, but there were some indications of reduced demand. It is expected that the economic situation, with high inflation and cost increases, will lead to lower demand, primarily in the consumer discretionary segment.

Inflationary effects and lower volumes are having an adverse effect on earnings performance

• Operating profit (EBITA)

• EBITA margin

The Group's operating profit (EBITA) was SEK 214 million (339).

Operating profit (EBITA) was SEK 104 million (100) for Medical Solutions, SEK 77 million (200) for Integrated Solutions and SEK 33 million (42) for Industrial Solutions.

The EBITA margin for Medical Solutions was 8.4% (10.2). The combination of a change in the sales mix, with a greater proportion from the surgery area and a lower proportion from IVD, had a negative impact on the margin. It has not yet been possible to fully charge on inflationary effects and higher production costs, the greatest impact from which has been in the US. Investments in capacity made in 2021 are still not being fully used and are consequently having a negative impact on the margin.

For Integrated Solutions, the margin was 10.3% (13.2). Lower VHP volumes had an adverse effect.

The EBITA margin for Industrial Solutions was 5.2% (7.8). A component shortage, particularly in automotive but in other areas too, has continued to impact the demand that our customers are experiencing and has led to fluctuating production planning for Nolato. This has resulted in lower production efficiency, which, together with a time lag in the charging on of cost increases, has adversely affected the margin.

Overall, the Group's EBITA margin was 8.1% (11.2).

Operating profit (EBIT) was SEK 205 million (331).

Profit after net financial income/expense was SEK 197 million (322).

Profit after tax was SEK 160 million (257). Diluted earnings per share were SEK 0.59 (0.95). Adjusted earnings per share after dilution, but excluding amortization of intangible assets arising from acquisitions, amounted to SEK 0.62 (0.98).

Profit • Adjusted diluted earnings per share

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

Sales Sales EBITA EBITA EBITA marg. EBITA marg.
SEK million Q3/2022 Q3/2021 Q3/2022 Q3/2021 Q3/2022 Q3/2021
Medical Solutions 1,245 977 104 100 8.4% 10.2%
Integrated Solutions 745 1,519 77 200 10.3% 13.2%
Industrial Solutions 638 540 33 42 5.2% 7.8%
Intra-Group adj., Parent Co – 2 – 3 – 3
Group total 2,626 3,033 214 339 8.1% 11.2%

Operating profit (EBITA): Earnings before financial income and expense, taxes and amortization of intangible assets arising from acquisitions.

First nine months 2022

Consolidated sales totaled SEK 8,410 million (8,464). Adjusted for currency, this was a decrease of 10%.

Sales for Medical Solutions rose by 18% to SEK 3,547 million (3,004), while for Integrated Solutions they decreased by 23% to SEK 2,904 million (3,750) and increased for Industrial Solutions by 15% to SEK 1,967 million (1,715).

The Group's operating profit (EBITA) was SEK 745 million (SEK 983 million excluding a non-recurring item). Overall, the Group's EBITA margin was 8.9% (11.6% excluding a non-recurring item).

Operating profit (EBIT) amounted to SEK 715 million (SEK 957 million excluding a non-recurring item).

Profit after net financial income and expense was SEK 689 million (SEK 918 million excluding a non-recurring item).

Profit after tax amounted to SEK 551 million (SEK 724 million excluding a non-recurring item). Diluted earnings per share were SEK 2.05 (SEK 2.70 excluding a non-recurring item). Adjusted earnings per share after dilution but excluding amortization of intangible assets arising from acquisitions amounted to SEK 2.13 (SEK 2.77 excluding a non-recurring item). The effective tax rate was 20.0% (20.0).

Return on capital employed was 16.7% for the last 12 months (22.8% for the 2021 calendar year). Return on equity was 19.2% for the last 12 months (28.0% for the 2021 calendar year).

Medical Solutions •

Sales and profit 9 months (SEK million) 2022 2021
Sales 3,547 3,004
Operating profit (EBITA) 331 345
EBITA margin (%) 9.3 11.5
Operating profit (EBIT) 309 326

Medical Solutions sales amounted to SEK 3,547 million (3,004); adjusted for currency, sales increased by 7%. The charging on of higher costs contributed to the increase in sales. The surgery area saw good growth, while in vitro diagnostics (IVD) volumes were low due to pandemic-related inventory adjustments, which have continued to have an impact.

Operating profit (EBITA) was SEK 331 million (345).

The EBITA margin decreased to 9.3% (11.5). The combination of a change in the sales mix, with a greater proportion from the surgery area and a lower proportion from IVD, had a negative impact on the margin. A time lag in the charging on of cost increases also had an effect. Investments in capacity made in 2021 are still not being fully used and are consequently having a negative impact on the margin.

Integrated Solutions

Sales and profit 9 months (SEK million)
Sales 2,904 3,750
Operating profit (EBITA) 309 479
EBITA margin (%) 10.6 12.8
Operating profit (EBIT) 308 478

Integrated Solutions sales totaled SEK 2,904 million (3,750). Adjusted for currency, sales decreased by 33%. Demand for Vaporiser Heating Products (VHP) in Eastern Europe has been adversely affected following Russia's invasion of Ukraine. Nolato believes that the VHP area will continue to be impacted by the situation in Eastern Europe and by the effects of dual sourcing in the second half of the year. In addition, Nolato has not manufactured any VHP products in China in October because of new regulatory requirements relating to VHP products established by Chinese authorities. Licensing by a Chinese authority has been ongoing in 2022, but Nolato has not yet received the relevant license. The EMC business is continuing to perform well. Nolato estimates this business area's total sales in the fourth quarter will be in the region of half a billion kronor.

Operating profit (EBITA) was SEK 309 million (479).

The EBITA margin was 10.6% (12.8). Lower VHP volumes had an adverse effect.

Medical Solutions sales

• Medical Solutions operating profit (EBITA) & EBITA margin %

2022 2021 Integrated Solutions sales

Industrial Solutions •

Sales and profit 9 months (SEK million) 2022 2021
Sales 1,967 1,715
Operating profit (EBITA) 110 170
EBITA margin (%) 5.6 9.9
Operating profit (EBIT) 103 164

Industrial Solutions sales amounted to SEK 1,967 million (1,715); adjusted for currency, sales increased by 8%. Volumes were more or less unchanged from the same period last year, while the charging on of cost increases contributed positively to sales. Demand remained good in most market areas, but there were some indications of reduced demand in the third quarter. It is expected that the economic situation, with high inflation and cost increases, will lead to lower demand, primarily in the consumer discretionary segment.

Operating profit (EBITA) was SEK 110 million (170).

The EBITA margin decreased to 5.6% (9.9). A component shortage, particularly in automotive but in other areas too, has continued to impact the demand that our customers are experiencing and has led to fluctuating production planning for Nolato. This has resulted in lower production efficiency, which, together with a time lag in the charging on of cost increases, has adversely affected the margin.

Industrial Solutions sales

• Industrial Solutions operating profit (EBITA) & EBITA margin %

Cash flow •

Cash flow after investments in the third quarter amounted to SEK 166 million (116). During the quarter, tied-up working capital increased marginally by SEK 5 million (15). Net investments affecting cash flow decreased in the quarter to SEK 109 million (245).

Accumulated after nine months, cash flow after investments was SEK 143 million (533). Cash flow from operating activities before changes in working capital decreased to SEK 833 million (1,089), primarily impacted by lower earnings. The working capital requirement increased by SEK 338 million (decreased by SEK 21 million during the same period last year) and is adversely affecting cash flow. Among other things, the use of supplier finance for trade receivables has decreased. The net investments affecting cash flow decreased to SEK 352 million (577). Cash conversion for the last 12 months was 5% (35% for the 2021 calendar year). A dividend totaling SEK 512 million (428) was paid to shareholders in the second quarter.

Cash flow after investments

Financial position • Net financial liabilities & equity/assets ratio

Interest-bearing assets decreased to SEK 1,193 million (1,400), and interestbearing financial liabilities rose to SEK 1,773 million (1,472). Net financial liabilities consequently totaled SEK 580 million (72). Higher working capital requirements and the higher dividend have increased financial liabilities and, consequently, net debt too. There are also interest-bearing pension liabilities of SEK 170 million (259) and interest-bearing lease liabilities of SEK 317 million (306). Shareholders' equity rose to SEK 5,398 million (4,280). The equity/assets ratio was 51% (45).

Financial position

SEK million 30/09/2022 30/09/2021 31/12/2021
Interest-bearing liabilities, credit institutions – 1,773 – 1,472 – 1,499
Cash and bank 1,193 1,400 1,448
Net financial liabilities (–) – 580 – 72 – 51
Interest-bearing pension liabilities – 170 – 259 – 247
Net financial liabilities (–), incl. pension liabilities – 750 – 331 – 298
Lease liabilities – 317 – 306 – 295
Net financial liabilities (–), including pension- & lease liabilities – 1,067 – 637 – 593
Working capital 899 230 480
As a percentage of sales (average) (%) 4.9 2.1 3.7
Capital employed 7,659 6,318 6,809
Return on capital employed (average) (%) 16.7 20.6 22.8
Shareholders' equity 5,398 4,280 4,768
Return on shareholders' equity (average) (%) 19.2 25.1 28.0

Consolidated performance analysis

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million Note 2022 2021 2022 2021 12 months 2021
Net sales 1 2,626 3,033 8,410 8,464 11,556 11,610
Gross profit excl. depreciation/amortization 464 563 1,485 1,668 2,067 2,250
As a percentage of net sales 17.7 18.6 17.7 19.7 17.9 19.4
Costs – 121 – 113 – 370 – 312 – 503 – 445
As a percentage of net sales 4.6 3.7 4.4 3.7 4.4 3.8
Operating profit (EBITDA) 343 450 1,115 1,356 1,564 1,805
As a percentage of net sales 13.1 14.8 13.3 16.0 13.5 15.5
Depreciation and amortization – 129 – 111 – 370 – 323 – 483 – 436
Operating profit (EBITA) 214 339 745 1,033 1,081 1,369
As a percentage of net sales 8.1 11.2 8.9 12.2 9.4 11.8
Amortization of intangible assets arising fr. acquis. – 9 – 8 – 30 – 26 – 40 – 36
Operating profit (EBIT) 2 205 331 715 1,007 1,041 1,333
Financial income and expense 2 – 8 – 9 – 26 – 39 81 68
Profit after financial income and expense 2 197 322 689 968 1,122 1,401
Tax – 37 – 65 – 138 – 194 – 185 – 241
As a perc. of profit after financial inc. and exp. 18.8 20.2 20.0 20.0 16.5 17.2
Profit after tax 160 257 551 774 937 1,160

Personnel • Contact:

The average number of employees during the period was 7,004 people (8,325). The decrease in the number of employees is mainly attributable to Integrated Solutions' operations in China.

New business area president

Nolato has appointed Anders Björklund as the new President of the Industrial Solutions business area and a member of Nolato's Group management. Over the past decade, Anders Björklund has held a number of senior management positions in the Sandvik Group and was most recently managing director of Kanthal, now part of Alleima. Anders has also previously worked at Gunnebo Industries, Volvo Construction Equipment and Ericsson. He will begin in his new role no later than the turn of the year. The former business area President Johan Arvidsson decided in April to take up a new position outside Nolato. Group President Christer Wahlquist will be acting President of Industrial Solutions until Anders Björklund assumes the role.

Significant risks and uncertainty factors

The Group and parent company's business risks and risk management, as well as the management of financial risks, are described on pages 59–61 and in Note 30 on pages 89–92 of the 2021 annual accounts.

High inflation, geopolitical effects of the invasion of Ukraine and Covid-19 naturally also affect Nolato's operations and its customers. At present, it is not possible to predict the duration or scope and thus not quantify these effects for the Group.

No other events of material significance occurred in the period that materially affect or change these descriptions of the Group and parent company's risks and their management.

Seasonal effects

Nolato does not experience any significant seasonal variations. However, in the third quarter sales within Industrial Solutions, and to a certain degree Medical Solutions, can be negatively affected by the fact that the holiday period falls in this quarter both for Nolato and its customers.

  • Christer Wahlquist, President and CEO, tel. +46705 804848.
  • Per-Ola Holmström, CFO, tel. +46705 763340.

• Webcast conference call on 27 October:

In connection with the interim report, Nolato will hold a webcast conference call in English at 2.45 p.m. CET. Nolato will be represented by President and CEO Christer Wahlquist and CFO Per-Ola Holmström, who will present the interim report and answer questions. Information regarding telephone numbers and website is available at

https://financialhearings.com/ event/43264. The presentation will be available at www.nolato.com/ir after publication of the interim report. The webcast will be available at the same address after the live broadcast.

Events after the balance sheet date

High inflation, geopolitical impact from the invasion of Ukraine and the Covid-19 pandemic are, of course, also affecting Nolato's business and its customers. It is not currently possible to foresee the extent of this or how long it is likely to continue, nor is it possible to quantify its effects on the Group. Nolato has not yet received a license to manufacture VHP products in China on the basis of new regulatory requirements as of October. See also our press release of 21 October. No other significant events have occurred since the end of the period.

Ownership and legal structure

Nolato AB (publ), with Swedish corporate identity number 556080-4592, is the parent company of the Nolato Group.

Nolato's Class B shares are listed on Nasdaq Stockholm in the Large Cap segment, where they are included in the Industrials sector.

There were 17,188 shareholders at 30 September. The largest shareholders are the Jorlén family, the Boström family and the Hamrin family with 9% each, Lannebo Fonder with 7%, Första AP-fonden with 6% and Andra AP-fonden with 4% of capital.

The Parent Company

For the parent company, which has no operating activities, sales amounted to SEK 53 million (53). Profit after financial income and expense amounted to SEK 44 million (257).

Contingent liabilities amounted to SEK 322 million (316).

Accounting and valuation principles

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

The interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and applicable provisions of the Swedish Annual Accounts Act. Publication of this interim report is subject to the Swedish Securities Market Act.

The consolidated accounts have been prepared according to the same principles as in the most recent annual accounts, as set out in the Annual Report 2021.

IASB and the IFRS Interpretations Committee have issued new standards and statements that apply to financial years starting January 1, 2022, or later. There are no plans for the early application of new or amended standards for future application. None of the standards or interpretations published by IASB are expected to have a material impact on the Group or Parent Company's financial statements.

The interim report for the Parent Company has been prepared in accordance with Chapter 9 of the Swedish Annual Accounts Act.

Prior to publication this information constituted inside information that Nolato AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the above contact persons, at 1:45 p.m. CET on 27 October 2022.

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

Nomination Committee

In accordance with a decision at Nolato's AGM on May 3, 2022, the largest shareholders in terms of the number of votes at the end of September 2022 have appointed the following individuals to be included in Nolato's Nomination Committee ahead of the 2023 AGM: Henrik Jorlén, chairman (Jorlén family), Gun Boström (Boström family), Lovisa Hamrin (Hamrin family), Hjalmar Ek (Lannebo Fonder) and Ossian Ekdahl (AP1 Fund).

Shareholders who would like to submit proposals to the Nomination Committee can contact the chairman of the Nomination Committee, Henrik Jorlén, by email at [email protected] or by mail at Kommendörsgatan 4, 269 77 Torekov, Sweden.

Annual General Meeting

The Annual General Meeting will be held on May 3, 2023.

Financial information schedule

  • 2022 year-end report: 8 February 2023
  • Three-month interim report 2023: 3 May 2023
  • 2023 Annual General Meeting: 3 May 2023
  • Six-month interim report 2023: 20 July 2023
  • Nine-month interim report 2023: 26 October 2023
  • 2023 year-end report: 6 February 2024

Torekov, 27 October 2022 Nolato AB (publ) Christer Wahlquist, President and CEO

Nolato's business

Nolato is a global, advanced high-tech cooperation partner and manufacturer of polymer products and systems for leading customers in well-defined market areas such as medical technology, pharmaceuticals, consumer electronics, telecom, automotive, hygiene and other selected industrial sectors.

With its many years of experience, in-depth materials and processes expertise, early involvement in customer projects, advanced project management and detailed knowledge of each customer's specific requirements, Nolato is an effective and innovative partner.

Nolato's business model

Our business model is based on three decentralised business areas, which with their own decision-making and shared ambitions endeavour to fulfil our vision and financial targets.

The sharing of experience between our business areas, leading-edge technology, wide-ranging development and design know-how, advanced project management and efficient production allow us to establish long-term, innovative cooperation with our customers and partners and generate added value for both them and our shareholders.

Our shared values of being professional, well organised and responsible are reflected in everything we do.

Nolato's strategies

  • Early involvement in customers' development processes
  • Close and long-term collaboration/Partnerships with our customers
  • Innovative, integrated and high-tech solutions
  • High productivity/Lean manufacturing
  • Advancing up the value chain/Greater added value
  • Global presence
  • Responsible business practice

Nolato is a Swedish group with operations in Europe, Asia and North America.

We develop and manufacture products in polymer materials such as plastic, silicone and TPE for leading customers within medical technology, pharmaceuticals, consumer electronics, telecom, automotive, hygiene and other selected industrial sectors.

Nolato's shares are listed on Nasdaq Stockholm in the Large Cap segment, where they are included in the Industrials sector.

www.nolato.com

Consolidated income statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million Note 2022 2021 2022 2021 12 months 2021
Net sales 1 2,626 3,033 8,410 8,464 11,556 11,610
Cost of goods sold – 2,285 – 2,577 – 7,290 – 7,115 – 9,968 – 9,793
Gross profit 341 456 1,120 1,349 1,588 1,817
Other operating income 15 1 41 55 56 70
Selling expenses – 53 – 44 – 157 – 131 – 204 – 178
Administrative expenses – 98 – 84 – 289 – 260 – 386 – 357
Other operating expenses 2 – 6 – 13 – 19
– 136 – 125 – 405 – 342 – 547 – 484
Operating profit 2 205 331 715 1,007 1,041 1,333
Financial income and expense 2 – 8 – 9 – 26 – 39 81 68
Profit after financial income and expense 2 197 322 689 968 1,122 1,401
Tax – 37 – 65 – 138 – 194 – 185 – 241
Profit after tax 160 257 551 774 937 1,160
All earnings are attrib. to the Parent Co.'s shareh.
Depreciation/amortization reg. non-current assets 138 119 400 349 523 472
Basic earnings per share, SEK 3 0.59 0.96 2.05 2.89 3.48 4.32
Diluted earnings per share, SEK 3 0.59 0.95 2.05 2.88 3.48 4.32
269,377,080 269,282,080 269,377,080 269,282,080 269,377,080 269,377,080
Number of shares at the end of the period, bef. dil. 269,377,080 269,323,327 269,377,080 269,323,327 269,377,080 269,379,505
Number of shares at the end of the period, after dil. 269,377,080 269,098,330 269,377,080 268,270,205 269,358,080 268,491,580
Average number of shares, before dilution 269,377,080 269,227,427 269,377,080 268,629,519 269,366,814 268,779,516
Average number of shares, after dilution

At the end of the period, the Group had two incentive programmes: Incentive Programme 2019/2024 and Incentive Programme 2022/2028. For more information please see Note 3 Earnings per share on page 16.

Consolidated comprehensive income

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 2022 2021 12 months 2021
Profit after tax 160 257 551 774 937 1,160
Other comprehensive income
Items that cannot be transferred to profit for the period
Revaluations of defined benefit pension plans 9 1 96 22 115 41
Tax attrib. to items that cannot be transf. to profit for the per. – 1 – 15 – 3 – 18 – 6
8 1 81 19 97 35
Items that have been conv. or can be conv. into prof. for the per.
Transl. diff. for the period on transl. of foreign operations 229 54 516 117 594 195
Changes in the fair value of cash flow hedges for the period 2 – 1 – 9 9 – 9 9
Tax attrib. to changes in the fair value of cash flow hedges 1 3 – 2 3 – 2
232 53 510 124 588 202
Other comprehensive income, net of tax 240 54 591 143 685 237
Total comp. inc. for the per. attrib. to the Parent Co.'s shareh. 400 311 1,142 917 1,622 1,397

Financial instruments are measured at fair value in the statement of financial position, pursuant to measurement hierarchy Level 2.

Consolidated balance sheet (summary)

SEK million 30/09/2022 30/09/2021 31/12/2021
Assets
Non-current assets
Intangible non-current assets 2,598 2,182 2,234
Property, plant and equipment 3,235 2,739 2,868
Non-current financial assets 2 2 2
Other non-current receivables 1 2 2
Deferred tax assets 76 54 69
Total fixed assets 5,912 4,979 5,175
Current assets
Inventories 1,266 1,194 1,340
Accounts receivable 1,658 1,422 1,574
Other current assets2) 606 547 518
Cash and bank 1,193 1,400 1,448
Total current assets 4,723 4,563 4,880
Total assets 10,635 9,542 10,055
Shareholders' equity and liabilities
Shareholders' equity 5,398 4,280 4,768
Long-term liabilities and provisions1) 2,173 2,058 1,921
Deferred tax liabilities1) 264 205 254
Current liabilities and provisions1) 3) 2,800 2,999 3,112
Total liabilities and provisions 5,237 5,262 5,287
Total shareholders' equity and liabilities 10,635 9,542 10,055
1) Interest-bearing/non-interest-bearing liabilities and provisions:
Interest-bearing liabilities and provisions 2,260 2,037 2,041
Non-interest-bearing liabilities and provisions 2,977 3,225 3,246
Total liabilities and provisions 5,237 5,262 5,287

Financial instruments are measured at fair value in the statement of financial position,

pursuant to measurement hierarchy Level 2.

2) Derivative assets are included in other current assets at

3) Derivative liabilities are included in current liabilities and provisions at 83 44 5

1 1 1

Changes in consolidated shareholders' equity (summary)

Q1 - Q3 Q1 - Q3 Full year
SEK million 2022 2021 2021
Shareholders' equity at the beginning of the period 4,768 3,699 3,699
Total comprehensive income for the period 1,142 917 1,397
Dividends – 512 – 428 – 428
Share warrants included in incentive programmes 3
Exercise of warrants included in incentive programmes 92 97
Shareholders' equity at the end of period attrib. to Parent Co's shareh. 5,398 4,280 4,768

At the end of the period, the Group had two incentive programmes: Incentive Programme 2019/2024 and Incentive Programme 2022/2028. In Incentive Programme 2019/2024, Series 2020/2023 has redemptions from 01/05/2023 to 15/12/2023 and Series 2021/2024 has redemptions from 01/05/2024 to 15/12/2024. The subscription price is SEK 92.88 for Series 2020/2023 and SEK 140.20 for Series 2021/2024. In Incentive Programme 2022/2028, Series 2022/2026 has redemptions from 15/12/2025 to 15/06/2026, Series 2023/2027 has redemptions from 15/12/2026 to 15/06/2027 and Series 2024/2028 has redemptions from 15/12/2027 to 15/06/2028. The programmes have been taken into account in calculating the number of shares after dilution. Upon full subscription, the programmes provide a maximum of 8,524,500 new class B shares.

Consolidated cash flow statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 2022 2021 12 months 2021
Cash fl. from oper. activities bef. changes in work. cap. 280 376 833 1,089 1,146 1,402
Changes in working capital – 5 – 15 – 338 21 – 533 – 174
Cash flow from operating activities 275 361 495 1,110 613 1,228
Cash flow from investment activities – 109 – 245 – 352 – 577 – 557 – 782
Cash flow before financing activities 166 116 143 533 56 446
Cash flow from financing activities – 131 – 4 – 539 – 711 – 462 – 634
Cash flow for the period 35 112 – 396 – 178 – 406 – 188
Cash and cash equiv. at the beginning of the period 1,115 1,248 1,448 1,487 1,487
Exchange rate difference in liquid assets 43 40 141 91 149
Cash and cash equivalents at the end of the period 1,193 1,400 1,193 1,400 1,448

Note 1 Revenue

Q1 - Q3 - 2022 Q1 - Q3 - 2021 Full year - 2021
Med. Integr. Indust. Med. Integr. Indust. Med. Integr. Indust.
SEK million Sum Sol. Sol. Sol. Sum Sol. Sol. Sol. Sum Sol. Sol. Sol.
Sweden 711 103 26 582 689 90 20 579 914 117 29 768
Other Europe 4,558 1,688 1,808 1,062 4,105 1,498 1,732 875 5,839 1,998 2,638 1,203
North America 1,918 1,517 139 262 1,515 1,200 119 196 2,083 1,668 154 261
Asia 1,103 127 924 52 2,008 115 1,834 59 2,588 153 2,352 83
Rest of world 128 112 7 9 152 101 45 6 193 131 53 9
Elimination internal sales – 8 – 5 – 7
Tot. revenues fr. customer contracts 8,410 3,547 2,904 1,967 8,464 3,004 3,750 1,715 11,610 4,067 5,226 2,324

The above table essentially covers products transferred at a specific date.

For the first nine months of the year, the Group recognised increased provision of impaired trade receivables of SEK 11 million. Impairment losses are recognised in the cost of goods sold.

Note 2 Reconciliation of consolidated income before tax

Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 12 months 2021
Operating profit (EBIT)
Medical Solutions 309 326 413 430
Integrated Solutions 308 478 500 670
Industrial Solutions 103 164 139 200
Group adjustments, Parent Company – 5 39 – 11 33
Consolidated operating profit (EBIT) 715 1,007 1,041 1,333
Financial income and expense (not distributed by business areas) – 26 – 39 81 68
Consolidated profit before tax 689 968 1,122 1,401

Including a non-recurring item of SEK 50 million in operating profit in Q2 2021. The non-recurring item has been recognised at Group level and has therefore not affected the earnings of the business areas.

Including a non-recurring item of SEK 115 million in financial income and expense in Q4 2021. The non-recurring item has been recognised at Group level and has therefore not affected the earnings of the business areas.

Note 3 Earnings per share (IFRS measures/alternative performance measures)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 2022 2021 12 months 2021
Profit after tax 160 257 551 774 937 1,160
Average number of shares, before dilution 269,377,080 269,098,330 269,377,080 268,270,205 269,358,080 268,491,580
Basic earnings per share (SEK) 0.59 0.96 2.05 2.89 3.48 4.32
Non-recurring items – 50 – 115 – 165
Profit after tax excl. non-recurring items 160 257 551 724 822 995
Basic earnings per share excl. non-recurring items (SEK) 0.59 0.96 2.05 2.70 3.48 3.71
Dilutive shares from Series 2018/2021 incentive progr. with
exercise price SEK 50.20 per share; total 1,935,000 warrants 119,506 359,314 8,249 287,451
Dilutive shares from Series 2020/2023 incentive progr. with
exercise price SEK 92.88 per share; total 287,500 warrants 9,591 485 485
Average number of shares, after dilution 269,377,080 269,227,427 269,377,080 268,629,519 269,366,814 268,779,516
Diluted earnings per share (SEK) 0.59 0.95 2.05 2.88 3.48 4.32
Diluted earnings per share excl. non-rec. items (SEK) 0.59 0.95 2.05 2.70 3.05 3.70
Numb. of shares at the end of the per., before dilution 269,377,080 269,282,080 269,377,080 269,282,080 269,377,080 269,377,080
Numb. of shares at the end of the period, after dilution 269,377,080 269,323,327 269,377,080 269,323,327 269,377,080 269,379,505

At the end of the period, the Group had two incentive programmes: Incentive Programme 2019/2024 and Incentive Programme 2022/2028. In Incentive Programme 2019/2024, Series 2020/2023 has redemptions from 01/05/2023 to 15/12/2023 and Series 2021/2024 has redemptions from 01/05/2024 to 15/12/2024. The subscription price is SEK 92.88 for Series 2020/2023 and SEK 140.20 for Series 2021/2024. In Incentive Programme 2022/2028, Series 2022/2026 has redemptions from 15/12/2025 to 15/06/2026, Series 2023/2027 has redemptions from 15/12/2026 to 15/06/2027 and Series 2024/2028 has redemptions from 15/12/2027 to 15/06/2028. The programmes have been taken into account in calculating the number of shares after dilution. Upon full subscription, the programmes provide a maximum of 8,524,500 new class B shares.

Adjusted earnings per share (alternative performance measures)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 2022 2021 12 months 2021
Profit after tax 160 257 551 774 937 1,160
Adjusted earnings:
Amort. of intangible assets arising from acquisitions 9 8 30 26 40 36
Tax on amortization – 2 – 1 – 6 – 5 – 8 – 7
Adjusted earnings 167 264 575 795 969 1,189
Average number of shares, before dilution 269,377,080 269,098,330 269,377,080 268,270,205 269,358,080 268,491,580
Adjusted basic earnings per share (SEK) 0.62 0.98 2.13 2.96 3.60 4.43
Non-recurring items – 50 – 115 – 165
Adjusted earnings after tax, excl. non-recurring items 167 264 575 745 854 1,024
Adj. basic earnings per share excl. non-rec. items (SEK) 0.62 0.98 2.13 2.78 3.17 3.81
Average number of shares, after dilution 269,377,080 269,227,427 269,377,080 268,629,519 269,366,814 268,779,516
Adjusted diluted earnings per share (SEK) 0.62 0.98 2.13 2.96 3.60 4.42
Adj. diluted earn. per share excl. non-rec. items (SEK) 0.62 0.98 2.13 2.77 3.17 3.81

Five-year overview

IFRS measures 2021 2020 2019 2018 2017
Operating profit (EBIT) (SEK million) 1,333 1,048 887 941 749
Basic earnings per share (SEK) 4.32 3.03 2.66 2.74 2.17
Diluted earnings per share (SEK) 4.32 3.02 2.66 2.74 2.17
Alternative performance measures
Net sales (SEK million) 11,610 9,359 7,919 8,102 6,720
Operating profit (EBITA) (SEK million) 1,369 1,066 895 949 763
EBITA margin (%) 11.8 11.4 11.3 11.7 11.4
Profit after financial income and expense (SEK million) 1,401 1,014 857 921 731
Profit after tax (SEK million) 1,160 806 703 722 572
Cash flow after investments, excl. acq. and disposals (SEK million) 446 905 800 593 496
Cash conversion (%) 35 87 88 60 66
Return on capital employed (%) 22.8 20.7 23.1 29.7 26.6
Return on shareholders' equity (%) 28.0 23.9 25.5 30.4 29.4
Net financial liabilities (–) / assets (+), excl. pension- & lease
liabilities (SEK million)
– 51 – 298 666 341 31
Equity/assets ratio (%) 47 43 48 50 45
Adjusted basic earnings per share (SEK) 4.43 3.08 2.68 2.77 2.22
Adjusted diluted earnings per share (SEK) 4.42 3.08 2.68 2.76 2.22
Dividend per share (SEK) 1.90 1.60 1.40 1.25
Average number of employees 8,669 6,721 5,941 6,449 7,249

Including any non-recurring items.

Quarterly data (summary)

2022
258
252
205


Operating profit (EBIT) (SEK million)
2
2021
299
377
331
326
1,333
2
2020
225
267
282
274
1,048
2022
0.75
0.71
0.59


Basic earnings per share (SEK)
3
2021
0.85
1.09
0.96
1.43
4.32
3
2020
0.67
0.78
0.79
0.79
3.03
2022
0.75
0.71
0.59


Diluted earnings per share (SEK)
3
2021
0.84
1.08
0.95
1.43
4.32
3
2020
0.67
0.78
0.79
0.79
3.02
Q1
Q2
Q3
Q4
Full year
Alternative performance measures
Note
2022
2,879
2,905
2,626


Net sales (SEK million)
1
2021
2,645
2,786
3,033
3,146
11,610
1
2020
2,065
2,307
2,500
2,487
9,359
2022
386
386
343


Operating profit (EBITDA) (SEK million)
2021
414
492
450
449
1,805
2020
319
360
388
389
1,456
2022
267
264
214


Operating profit (EBITA) (SEK million)
2021
308
386
339
336
1,369
2020
227
269
287
283
1,066
2022
9.3
9.1
8.1


EBITA margin (%)
2021
11.6
13.9
11.2
10.7
11.8
2020
11.0
11.7
11.5
11.4
11.4
2022
251
241
197


Profit after financial income and exp. (SEK million)
2
2021
286
360
322
433
1,401
2
2020
221
257
267
269
1,014
2022
201
190
160


Profit after tax (SEK million)
2021
226
291
257
386
1,160
2020
177
207
211
211
806
2022
89
131
275


Cash flow from operating activities (SEK million)
2021
249
500
361
118
1,228
2020
– 3
748
76
343
1,164
2022
0.33
0.49
1.02


Cash fl. from operations per share bef. dilution (SEK)
2021
0.93
1.86
1.34
0.44
4.58
2020
– 0.01
2.82
0.29
1.28
4.37
2022
– 41
18
166


Cash flow after investments, excluding acquisitions
2021
71
346
116
– 87
446
and disposals (SEK million)
2020
– 73
685
82
211
905
2022
– 0.15
0.07
0.62


Cash flow after investments, excl. acquisitions and
2021
0.27
1.29
0.43
– 0.32
1.66
disposals per share before dilution (SEK)
2020
– 0.27
2.58
0.31
0.79
3.40
2022
0.77
0.74
0.62


Adjusted basic earnings per share (SEK)
3
2021
0.87
1.11
0.98
1.46
4.43
3
2020
0.67
0.78
0.81
0.82
3.08
2022
19
19
20


Shareholders' equity per share, before dilution (SEK)
2021
15
15
16
18
18
2020
12
13
14
14
14
2022
14.8
13.3
11.6


Return on total capital (%)
2021
14.0
14.6
14.3
15.7
15.7
2020
15.7
15.8
14.8
14.3
14.3
IFRS measures Note Q1 Q2 Q3 Q4 Full year
Alternative performance measures Q1 Q2 Q3 Q4 Full year
Return on capital employed (%) 2022 21.6 19.4 16.7
2021 20.2 21.0 20.6 22.8 22.8
2020 23.2 23.4 21.8 20.7 20.7
Return on operating capital (%) 2022 25.3 21.8 18.3
2021 28.0 28.5 26.8 27.1 27.1
2020 31.2 33.1 30.9 29.2 29.2
Return on shareholders' equity (%) 2022 25.8 22.5 19.2
2021 23.8 25.1 25.1 28.0 28.0
2020 26.0 25.9 25.0 23.9 23.9
Closing share price Nolato B (Nasdaq Stockholm) 2022 70.00 55.00 50.85
2021 77.80 84.20 104.70 107.90 107.90
2020 44.94 62.80 87.30 83.20 83.20

Including a non-recurring item of SEK 50 million in operating income and profit after tax in Q2 2021 and a non-recurring item of SEK 115 million in profit after financial income and expense and profit after tax in Q4 2021.

Including a non-recurring item of SEK −17 million in operating profit in Q3 2020 and tax effects of SEK +3 million, which impacted profit after tax by SEK −14 million.

Including a non-recurring item of SEK −14 million in operating profit in Q1 2020 and tax effects of SEK +3 million, which impacted profit after tax by SEK −11 million.

Quarterly data business areas

Alternative performance measures
Net sales (SEK million) Note Q1 Q2 Q3 Q4 Full year
Medical Solutions 1 2022 1,088 1,214 1,245
1 2021 1,006 1,021 977 1,063 4,067
2020 642 700 796 951 3,089
Integrated Solutions 1 2022 1,140 1,019 745
1 2021 1,045 1,186 1,519 1,476 5,226
2020 854 1,149 1,158 907 4,068
Industrial Solutions 1 2022 653 676 638
1 2021 595 580 540 609 2,324
2020 570 459 547 629 2,205
Group adjustments, Parent Company 1 2022 – 2 – 4 – 2
1 2021 – 1 – 1 – 3 – 2 – 7
2020 – 1 – 1 – 1 – 3
Group total 1 2022 2,879 2,905 2,626
1 2021 2,645 2,786 3,033 3,146 11,610
2020 2,065 2,307 2,500 2,487 9,359
Alternative performance measures
Operating profit (EBITA) (SEK million) Q1 Q2 Q3 Q4 Full year
Medical Solutions 2022 106 121 104
EBITA margin (%) 9.7 10.0 8.4
2021 121 124 100 112 457
EBITA margin (%) 12.0 12.1 10.2 10.5 11.2
2020 87 100 103 112 402
EBITA margin (%) 13.6 14.3 12.9 11.8 13.0
Integrated Solutions 2022 123 109 77
EBITA margin (%) 10.8 10.7 10.3
2021 125 154 200 192 671
EBITA margin (%) 12.0 13.0 13.2 13.0 12.8
2020 111 166 160 111 548
EBITA margin (%) 13.0 14.4 13.8 12.2 13.5
Industrial Solutions 2022 40 37 33
EBITA margin (%) 6.1 5.5 5.2
2021 66 62 42 38 208
EBITA margin (%) 11.1 10.7 7.8 6.2 9.0
2020 47 11 48 62 168
EBITA margin (%) 8.2 2.4 8.8 9.9 7.6
Group adjustments, Parent Company 2022 – 2 – 3
2021 – 4 46 – 3 – 6 33
2020 – 18 – 8 – 24 – 2 – 52
Group total 2022 267 264 214
EBITA margin (%) 9.3 9.1 8.1
2021 308 386 339 336 1,369
EBITA margin (%) 11.6 13.9 11.2 10.7 11.8
2020 227 269 287 283 1,066
EBITA margin (%) 11.0 11.7 11.5 11.4 11.4

Including a non-recurring item of SEK 50 million in operating profit in Q2 2021. The non-recurring item has been recognized at Group level and has therefore not affected the earnings of the business areas.

Including a non-recurring item of SEK −17 million in operating profit in Q3 2020. The non-recurring item has been recognized at Group level and has therefore not affected the earnings of the business areas.

Including a non-recurring item of SEK −14 million in operating profit in Q1 2020. The non-recurring item has been recognized at Group level and has therefore not affected the earnings of the business areas.

Q1 Q2 Q3 Q4 Full year
2022 69 74 79
2021 61 61 63 64 249
2020 41 41 48 63 193
2022 15 17 16
2021 15 16 15 16 62
2020 17 16 15 15 63
2022 43 43 43
2021 39 38 41 42 160
2020 36 36 43 36 151
2022 1
2021 1 1
2020 1 1
2022 128 134 138
2021 115 115 119 123 472
2020 94 93 106 115 408

Group financial highlights

IFRS measures
Note
Q3
2022
Q3
2021
Q1 - Q3
2022
Q1 - Q3
2021
Rolling
12 months
Full year
2021
Basic earnings per share (SEK) 3
3
0.59
0.59
0.96
0.95
2.05
2.05
2.89
2.88
3.48
3.48
4.32
4.32
Diluted earnings per share (SEK)
Alternative performance measures
Net sales (SEK million) 1 2,626 3,033 8,410 8,464 11,556 11,610
Sales growth (%) – 13 21 – 1 23 6 24
Percentage of sales outside Sweden (%) 92 94 92 92 92 92
Operating profit (EBITDA) (SEK million) 343 450 1,115 1,356 1,564 1,805
Operating profit (EBITA) (SEK million)1) 214 339 745 1,033 1,081 1,369
EBITA margin (%)1) 8.1 11.2 8.9 12.2 9.4 11.8
Profit after financial income and exp. (SEK million) 2 197 322 689 968 1,122 1,401
Profit margin (%)1) 7.5 10.6 8.2 11.4 9.7 12.1
Profit after tax (SEK million) 160 257 551 774 937 1,160
Return on total capital (%)1) 11.6 14.3 11.6 15.7
Return on capital employed (%)1) 16.7 20.6 16.7 22.8
Return on operating capital (%)1) 18.3 26.8 18.3 27.1
Return on shareholders' equity (%)1) 19.2 25.1 19.2 28.0
Equity/assets ratio (%) 51 45 51 47
Debt/equity (%) 42 48 42 43
Interest coverage ratio (times) 13 30 17 30 23 34
Net investments affecting cash flow, excl. acquisitions
and disposals (SEK million) 109 245 352 577 557 782
Cash flow after investments, excl. acquisitions and
disposals (SEK million)
166 116 143 533 56 446
Cash conversion (%)1) 5 35
Net financial liabilities, excl. pension- & lease liabilities
(SEK million)
– 580 – 72 – 580 – 51
Adjusted basic earnings per share (SEK) 3 0.62 0.98 2.13 2.96 3.60 4.43
Adjusted diluted earnings per share (SEK) 3 0.62 0.98 2.13 2.96 3.60 4.42
Cash flow from operations per share, before dilution
(SEK)
1.02 1.34 1.84 4.14 2.28 4.58
Cash flow from operations per share, after dilution
(SEK)
1.02 1.34 1.84 4.13 2.28 4.57
Cash flow after investments excluding acquisitions and
disposals, per share, before dilution (SEK)
0.62 0.43 0.53 1.99 0.21 1.66
Cash flow after investments excluding acquisitions and
disposals, per share, after dilution (SEK)
0.62 0.43 0.53 1.98 0.21 1.66
Shareholders' equity per share, before dilution (SEK) 20 16 18
Shareholders' equity per share, after dilution (SEK) 20 16 18
Average number of employees 7,004 8,325 8,669

See definitions of IFRS measures and alternative performance measures on page 22.

1) KPIs calculated as specified on pages 23 and 24.

Including a non-recurring item of SEK 50 million in operating profit and profit after tax in Q2 2021 and full year 2021 and SEK 115 million in profit after financial income and expense in Q4 2021 and full year 2021, which in total impacted profit after tax with SEK 165 million, for full year 2021.

Definitions - IFRS measures

Earnings for the period that are attributable to the parent company's owners divided by the average number of outstanding shares.

Earnings per share Operating profit (EBIT)

Earnings before financial income and expense and taxes.

Definitions - Alternative performance measures

Nolato presents certain financial measures in this report that are not defined according to IFRS. Nolato considers that these measures provide valuable supplementary information for investors and company management, as they enable an assessment of trends and the company's performance. Since not all companies calculate financial measures in the same way, these are not always comparable to measures used by other companies. These financial measures should not therefore be regarded as substitutes for measures defined according to IFRS.

Adjusted earnings per share Interest coverage ratio

Profit after tax, excluding amortization of intangible assets arising from acquisitions, divided by the average number of shares.

Average number of shares

The average basic number of shares comprises the parent bearing assets. company's weighted average number of outstanding shares during the period. After dilution, a weighted average of the shares that may be issued under the ongoing share warrant programme is added, if they are in-the-money, but only insofar as the average listed share price for the period exceeds the subscription price of the warrants.

Cash conversion Profit margin

Cash flow after investments, excl. acquisitions and disposals, divided by operating profit (EBIT). Cash flow and operating profit have been adjusted by non-recurring items, if any.

Cash flow after investments, excl. acquisitions and disposals per share

Cash flow after investing activities excl. acquisitions and disposals, divided by the average number of shares.

Cash flow from operating activities per share Return on operating capital

Cash flow from operating activities, divided by the average number of shares.

Debt/equity ratio

Interest-bearing liabilities and provisions divided by

Equity/assets ratio

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

Profit after financial income and expense, plus financial expenses, divided by financial expenses.

Net financial liabilities (–) / financial assets (+)

Interest-bearing liabilities from credit institutions less interest-

Operating profit (EBITA)

Earnings before financial income and expense, taxes and amortization of intangible assets arising from acquisitions.

Operating profit (EBITDA)

Earnings before financial income and expense, taxes and depreciation/amortization.

Profit after financial income and expense as a percentage of net sales.

Return on capital employed

Profit after financial income and expense, plus financial expenses as a percentage of average capital employed. Capital employed consists of total capital less non-interest-bearing liabilities and provisions.

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

Return on shareholders' equity

EBITA margin Return on total capital shareholders' equity. Profit after tax as a percentage of average shareholders' equity.

Operating profit (EBITA) as a percentage of net sales. Profit after financial income and expense, plus financial expenses as a percentage of average total capital in the balance sheet.

Forward-looking information

Some of the items reported relate to future events and actual outcomes may differ materially. In addition to those factors explicitly commented on, other factors may also materially affect the actual outcome, such as economic conditions, exchange rates and interest rate levels, political risks, competition and pricing, product development, commercialisation and technical difficulties, supply problems and customer credit losses.

Alternative performance measures

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million unless otherwise specified Note 2022 2021 2022 2021 12 months 2021
Operating profit (EBITDA) 343 450 1,115 1,356 1,564 1,805
Non-recurring items – 50 – 50
Adjusted operating profit (EBITDA) 343 450 1,115 1,306 1,564 1,755
Operating profit (EBIT) 2 205 331 715 1,007 1,041 1,333
Reversal of amort. of intangible assets arising
in connection with acquisitions 9 8 30 26 40 36
Operating profit (EBITA) 214 339 745 1,033 1,081 1,369
Non-recurring items – 50 – 50
Adjusted operating profit (EBITA) 214 339 745 983 1,081 1,319
EBITA margin (%) 8.1 11.2 8.9 12.2 9.4 11.8
Adjusted EBITA margin (%) 8.1 11.2 8.9 11.6 9.4 11.4
Profit after financial income and expense 2 197 322 689 968 1,122 1,401
Non-recurring items – 50 – 115 – 165
Adjusted profit after financial income and expense 197 322 689 918 1,007 1,236
Profit margin (%) 7.5 10.6 8.2 11.4 9.7 12.1
Adjusted profit margin (%) 7.5 10.6 8.2 10.8 8.7 10.6
Profit after tax 160 257 551 774 937 1,160
Non-recurring items – 50 – 115 – 165
Tax on non-recurring items
Adjusted profit after tax 160 257 551 724 822 995
Cash fl. after investm., excl. acquisitions and dispos. 56 446
Non-recurring items (affecting cash flow)
Adj. cash fl. after investments, excl. acq. and disp. 56 446
Operating profit (EBIT) 2 1,041 1,333
Non-recurring items – 50
Adjusted operating profit (EBIT) 1,041 1,283
Cash conversion (%) 5 35

Including a non-recurring item of SEK 50 million in operating profit and profit after tax in Q2 2021 and full year 2021 and SEK 115 million in profit after financial income and expense in Q4 2021 and full year 2021, which in total impacted profit after tax with SEK 165 million. The nonrecurring items have been recognised at Group level and have therefore not affected the earnings of the business areas.

Alternative performance measures Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3
SEK million unless otherwise specified 2022 2022 2022 2021 2021 2021 2021 2020 2020
Profit after financial income and exp., rolling 12 months 1,122 1,247 1,367 1,401 1,238
Financial expense, rolling 12 months 51 46 43 43 44
Adj. profit after financial inc. and exp., rolling 12 months 1,173 1,293 1,410 1,444 1,282
Total capital, at the end of period 10,635 10,220 9,984 10,056 9,542 8,784 9,191 8,482 8,899
Average total capital, last 5 quarters 10,087 9,717 9,511 9,211 8,980
Return on total capital (%) 11.6 13.3 14.8 15.7 14.3
Adj. profit after financial inc. and exp., rolling 12 months 1,173 1,293 1,410 1,444 1,282
Capital employed, at the end of period 7,659 7,220 7,074 6,809 6,318 5,984 6,479 6,116 6,167
Average capital employed, last 5 quarters 7,016 6,681 6,533 6,341 6,213
Return on capital employed (%) 16.7 19.4 21.6 22.8 20.6
Operating profit (EBIT), rolling 12 months 1,041 1,167 1,293 1,333 1,281
Capital employed, at the end of period 7,659 7,220 7,074 6,809 6,318 5,984 6,479 6,116 6,167
Cash and bank, at the end of period – 1,193 – 1,115 – 1,408 – 1,448 – 1,400 – 1,248 – 1,563 – 1,487 – 1,438
Operating capital, at the end of period 6,466 6,105 5,666 5,361 4,918 4,736 4,916 4,629 4,729
Average operating capital, latest 5 quarters 5,703 5,357 5,119 4,912 4,786
Return on operating capital (%) 18.3 21.8 25.3 27.1 26.8
Profit after tax, rolling 12 months 937 1,034 1,135 1,160 985
Shareholders' equity, at the end of period 5,398 4,998 5,010 4,768 4,280 3,951 4,025 3,699 3,653
Average shareholders' equity, latest 5 quarters 4,891 4,601 4,407 4,145 3,922
Return on shareholders' equity (%) 19.2 22.5 25.8 28.0 25.1

Parent Company income statement (summary)

Q3 Q3 Q1 - Q3 Q1 - Q3 Rolling Full year
SEK million 2022 2021 2022 2021 12 months 2021
Net sales 16 16 53 53 69 69
Selling expenses – 1 – 1 – 5 – 5 – 8 – 8
Administrative expenses – 14 – 13 – 44 – 40 – 61 – 57
Other operating income 1 1 3 9 4 10
Other operating expenses – 16 – 8 – 48 – 28 – 58 – 38
Operating profit – 14 – 5 – 41 – 11 – 54 – 24
Profit from participations in Group companies 26 64 141 233 598 690
Financial income 12 14 46 54 66 74
Financial expenses – 43 – 8 – 102 – 19 – 136 – 53
Profit after financial income and expense – 19 65 44 257 474 687
Appropriations 255 255
Tax 2 6 15 9 – 74 – 80
Profit after tax – 17 71 59 266 655 862
Depreciation/amortization

Parent Company balance sheet (summary)

SEK million 30/09/2022 30/09/2021 31/12/2021
Assets
Intangible fixed assets 1
Property, plant and equipment 1 1 1
Financial assets 4,096 3,671 3,821
Deferred tax assets 21 16
Total fixed assets 4,118 3,689 3,822
Other receivables 608 360 1,104
Cash and bank 130 60
Total current assets 608 490 1,164
Total assets 4,726 4,179 4,986
Shareholders' equity and liabilities
Shareholders' equity 2,654 2,503 3,107
Untaxed reserves 285 269 285
Deferred tax liabilities 17
Other provisions 7 8 6
Long-term liabilities 1,571 1,232 1,275
Current liabilities 209 167 296
Total shareholders' equity and liabilities 4,726 4,179 4,986
Transactions with related parties Period Services
sold
Services
bought
Interest
income
expenses Interest Result from
shares in
Rec fr rel
part on bal
Liab to rel
part on bal
SEK million Group com sheet date sheet date
Subsidiary Q1 - Q3 2022 53 – 17 46 141 1,563 140
Subsidiary Q1 - Q3 2021 53 – 18 54 233 2,013 143

None of the company's Board members or senior executives currently have, or have 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 (publ), Nolatovägen 32, SE-269 78 Torekov, Sweden • Tel. +46 431 442290 • Fax +46 431 442291 • Corp. id. number 556080-4592 • E-mail [email protected] • Website www.nolato.com

Talk to a Data Expert

Have a question? We'll get back to you promptly.