Interim Report January-September 2021

Record sales and full utilisation in transport operations

Third quarter

-

First nine months of the year

-

Significant events in the third quarter

r mancial summal y
Amounts in SEK million, unless otherwise stated	Jul-Sep 2021	Jul-Sep 2020	Jan-Sep 2021	Jan-Sep 2020	full-year 2020
Net sales	126.2	94.5	306.2	305.7	401.3
Operating profit/loss (EBIT)	25.3	14.4	31.5	46.1	60.4
Operating margin, %	20.0	15.3	10.3	15.1	15.0
Net profit/loss for the period	19.1	9.8	22.3	32.5	43.8
Equity/assets ratio, %	37.5	36.4	37.5	36.4	37.4
Earnings per share after dilution, SEK	0.79	0.40	0.92	1.36	1.82

CEO's comments

In the third quarter, we generated operating profit (EBIT) of SEK 25.3 million and net sales totalled SEK 126.2 million. This corresponded to an operating margin of 20.0 %. Net sales increased by 33.6 percent year-on-year, the highest figure on record for an individual quarter. The increase was mainly due to record high utilisation in the transport operations.

On the construction side, volumes were higher in the third quarter compared to the corresponding period in the previous year. Because construction work started early in the year last year, a high proportion of the work was carried out in the first half-year, unlike this year when construction work started later. Although this had a positive impact on the third quarter, year-on-year volumes were down for the year to date. In the lining operations, utilisation was higher year-on-year, and the number of enquiries and orders increased. Snow clearance on behalf of Trafikverket will start on 15 November, in line with previous years.

The tests and approvals needed to carry out work with our new battery-powered MPV on the Swedish railways have been completed and obtained since June. In Karlstad, the first live project with Railcares MPV started on 21 July, where we carried out cable excavations over four weeks. All the work relating to MPV has gone very well and ensures a good foundation for future development of battery-powered working vehicles on the railways.

Transport Scandinavia presented a very strong quarter with year-on-year growth of 57.1 percent. The increased sales, which set a new record for the segment, are the result of high utilisation of construction transport in connection with track replacements for operators including Leonhard Weiss, Infrakraft and others. In combination with extended and expanded transports for LKAB, where the current contract runs until 31 December 2021, this contributed to achieving record volume transports. Virtually all available resources, both in terms of personnel and machinery, operated at full capacity during the quarter.

We also transported iron ore on behalf of Kaunis Iron in the quarter, and transport services are proceeding as planned with two round trips each day, seven days a week, between Pitkäjärvi and Narvik.

The locomotive workshop had high utilisation in the quarter and demand for our services remains strong. During the quarter, we provided workshop services for BLS Rail, Strukton, Infranord and others, as well as carrying out repairs and maintenance of our own locomotives.

Year-on-year utilisation was lower in the third quarter in the UK, due to projects postponed by the customer. We carried out work in most of Network Rail's geographical regions in the quarter.

The business area Machine Sales presented lower year-on-year sales in the third quarter, totalling SEK 6.1 million (7.1). The decrease was due to reduced leasing of machinery to the Swedish construction operations. There were no major machine sales in the quarter.

The workshop is currently constructing two Ballast Feeders that will be used in our proprietary leasing operations in Sweden or abroad, as well as constructing power packs for Loram scheduled for delivery in the fourth quarter 2021.

Railcare currently has several projects out for tendering in areas where our innovative machines are a good fit with customer requirements. The planned establishment in Asia has been delayed due to Covid restrictions. We expect to start preparations for this in 2022.

The order stock is stable with multiple and long-term agreements relating to both transport and construction operations, which means that the outlook is very positive. In Sweden, the government has initiated historically high investments in railways and infrastructure to be rolled out over a long period. Many countries require extensive maintenance work on the railways and there is considerable interest in our innovative railway solutions, particularly our latest innovation relating to battery vehicles for railway machines.

Railcare has a very exciting journey ahead. As the world opens up again after the pandemic, we will be able to start to meet global demand, and we have made adjustments to Group management to better be able to meet the planned expansion. Looking ahead, I will be focusing on our second main market, the UK, and on being Business Area Manager of Construction Abroad. I would like to take this opportunity to thank all our staff, shareholders, customers and stakeholders for the 8 years that I have served as CEO of Railcare. We have made excellent progress together, and continue to build for the future. I also want to wish Mattias good luck in his role as Railcare's new CEO.

With innovative railway solutions and our staff as our primary resource, we are building the Railcare of the future.

Daniel Öholm CEO up until 30 September 2021

I am both humbled and grateful for the confidence shown in me with the appointment as CEO of Railcare. This is a fascinating company with an excellent corporate culture, great staff and a strong drive.

The extensive investments in railways announced in Sweden and internationally are important for the transition to a sustainable society. I am proud that Railcare leads the progress in sustainable railway maintenance thanks to the development of its battery-powered maintenance machine MPV. I look forward to continuing to develop innovative solutions alongside my incredible colleagues.

Mattias Remahl CEO from 1 October 2021

Financial summary – Railcare Group

Net sales

Operating expenses

Operating profit

Net profit/loss for the period

Cash Flow

Equity/assets ratio

Employees

Financial summary - business segments

The segments' net sales also include sales between segments. See Note 3 for sales between segments.

Construction Sweden

Net sales in the segment Construction Sweden amounted to SEK 35.9 million (29.9) in the third quarter, an increase of 20.2 percent year-on-year.

Volumes in the third quarter increased compared to the corresponding period in the previous year. Because construction work started early on in the year last year, a high proportion of the work was carried out during the first half of the year, in contrast with the current year when construction work started later. Although this has had a positive impact on the third quarter, so far in the year volumes are down compared to the previous year. In the lining operations, utilisation was higher compared to the corresponding period in the previous year, and the number of enquiries increased.

Profit after financial items increased year-on-year, amounting to SEK 6.7 million (-0.1).

In the first nine months of the year, net sales decreased by 23.7 percent, to SEK 90.6 million (118.8). Profit after financial items decreased to SEK 1.1 million (11.1).

Key performance indicators - Construction Sweden

Amounts in SEK 000. unless otherwise stated	Jul-Sep 2021	Jul-Sep 2020	Change, 00	Jan-Sep 2021	Jan-Sep 2020	Change, 90
Net sales	35.884	29.866	20.2	90.585	118.768	-23.7
Profit/loss after financial items	6.668	-79	8.582.3	1,062	11,098	-90.4
Net margin, %	18.6	-0.3	18.8	1.2	9.3	-8.2

Construction Abroad

Net sales in the segment Construction Abroad decreased by 41.0 percent in the third quarter 2021 year-on-year, totalling SEK 6.3 million (10.6).

Construction Abroad experienced lower volumes in the third quarter in year-onyear terms as a result of projects postponed by the customer.

Profit after financial items decreased to SEK -3.0 million (-0.4).

Net sales decreased by 25.5 percent in the first nine months of the year in year-onyear terms, totalling SEK 34.5 million (46.3). Profit after financial items decreased year-on-year, amounting to SEK -1.1 million (2.1).

Key performance indicators - Construction Abroad

Amounts in SEK 000, unless otherwise stated	Jul-Sep 2021	Jul-Sep 2020	Change, 90	Jan-Sep 2021	Jan-Sep 2020	Change, 90
Net sales	6.262	10,613	-41.0	34.500	46,309	-25.5
Profit/loss after financial items	-2.950	-420	-602.4	-1,136	2,134	-153.2
Net margin, %	-47.1	-4.0	-43.2	-3.3	4.6	-7.9

Transport Scandinavia

Net sales for the segment Transport Scandinavia increased by 57.1 percent in the third quarter compared to the corresponding period of the previous year, totalling SEK 89.1 million (56.7).

The increased sales, which are the highest on record for the segment, are due to high utilisation of construction transport in connection with track replacements, alongside extended and expanded transports for LKAB. Virtually all available resources, both personnel and machinery, operated at full capacity during the quarter. Iron ore transports for Kaunis Iron continued according to plan.

Utilisation in the locomotive workshop were in line with the previous year.

Profit after financial items increased to SEK 17.3 million (11.8).

Net sales increased by 38.1 percent in the first nine months of the year in year-onyear terms, totalling SEK 189.3 million (137.1), the highest net sales on record for the segment. Profit after financial items increased year-on-year, amounting to SEK 25.7 million (18.8).

Amounts in SEK 000, Jul-Sep Jul-Sep Change, Jan-Sep Jan-Sep Change, 2020 2021 2020 unless otherwise stated 2021 0% 00 89,146 56,728 57.1 189,314 137,066 38.1 Net sales 17,252 11.772 46.5 25,669 18,829 36.3 Profit/loss after financial items 19.4 20.8 -1.4 13.6 13.7 -0.2 Net margin, %

Key performance indicators - Transport Scandinavia

Machine Sales

Net sales in the segment Machine Sales decreased in the third quarter of 2021, compared to the corresponding quarter in the previous year and amounted to SEK 6.1 million (7.1).

The decrease was due to reduced leasing of machinery to the Swedish construction operations. There were no major machine sales in the quarter.

Profit after financial items amounted to SEK -0.1 million (1.4).

In the first nine months of the year, net sales amounted to SEK 30.7 million (42.1). Profit after financial items amounted to SEK 1.6 million (9.4). The lower sales and profit were primarily due to the delivery of three generators to Infranord in the first quarter 2020.

Key performance indicators - Machine Sales

Amounts in SEK 000, unless otherwise stated	Jul-Sep 2021	Jul-Sep 2020	Change, 90	Jan-Sep 2021	Jan-Sep 2020	Change, S
Net sales	6.072	7.101	-14.5	30.660	42.101	-27.2
Profit/loss after financial items	-71	1.416	-105.0	1.624	9,378	-82.7
Net margin, %	-1.2	19.9	-21.1	5.3	22.3	-17.0

Parent Company

Financial targets

-

Dividend

Significant events after the end of the period

Annual General Meeting 2022

Railcare's Annual General Meeting 2022 will take place on 4 May 2022 at 1:00 p.m. at the Company's premises at Näsuddsvägen 10, SE-932 32 Skelleftehamn, Sweden.

The Annual Report and other documents are available on Railcare's website, www.railcare.se.

Nomination Committee in preparation for Railcare Group AB's

Annual General Meeting 2022

In consultation with the largest shareholders, the Chairman of the Board of Railcare Group AB has established a Nomination Committee for the 2022 Annual General Meeting . The Nomination Committee consists of Lina Ådin, appointed by TREAC AB, Jonas Holmqvist, appointed by Norra Västerbotten Fastighets AB, and Kjell Lindskog, appointed by the Marklund and Dahlqvist family. The nomination committee has appointed Lina Adin as its chairman. The Nomination Committee's members together represent 38.9 per cent (30 September 2021) of the total number of shares and votes in the company.

The Nomination Committee's task is to submit proposals to the Annual General Meeting for the Chairman and other members of the Board, as well as fees and other remuneration for Board assignments to each of the Board members. The Nomination Committee shall also submit proposals for election and remuneration of auditors. Furthermore, the Nomination Committee shall, if needed, submit proposals for a process to appoint a Nomination Committee for the Annual General Meeting 2023.

Shareholders who wish to submit proposals to the Nomination Committee can do so via e-mail to [email protected]. Railcare's Annual General Meeting for 2022 will take place on 4 May 2022 at Railcare's head office in Skelleftehamn, Sweden.

Shareholder structure

Ten largest shareholders 30 September 2021	Number of shares	Proportion of share capital and votes (%)
Norra Västerbotten Fastighets AB	2,721,335	11.3
TREAC Aktiebolag	2,415,000	10.0
Marklund family through companies	2,233,905	9.3
Dahlqvist family through companies	2,002,155	8.3
Ålandsbanken AB	1,274,762	5.3
Avanza Pension insurance company	873,319	3.6
Bernt Larsson	750,987	3.1
Nordnet Pensionsförsäkring AB	393,124	1.6
Emil Burén	302,951	1.3
Futur Pension	287,413	1.2
Ten largest shareholders	13,254,951	54.9
Other shareholders	10,869,216	45.1
Total	24,124,167	100.0

4.357

Number of shareholders in Railcare Group AB as of 30 September 2021. Source: Euroclear

Source: Euroclear and Railcare

Significant risks and uncertainties

Transactions with related parties

The Board's and CEO's assurances

Mattias Remahl CEO

Catharina Elmsäter-Svärd Ulf Marklund Anna Weiner Jiffer Chairman Board member, Deputy CEO Board member

Adam Ådin Anders Westermark Björn Östlund Board member Board member Board member

Review report

Introduction

Scope of review

Conclusion

FINANCIAL REPORTS

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME IN SUMMARY

Amounts in SEK 000	Note	Jul-Sep 2021	Jul-Sep 2020	Jan-Sep 2021	Jan-Sep 2020	full-year 2020

Net sales	3	126,195	94,477	306,178	305,717	401,301
Capitalised work on own account		1,915	3,466	6,775	4,870	16,217
Other operating income		1,210	1,020	3,585	3,375	3,603
Total		129,319	98,962	316,537	313,962	421,120

Raw materials and consumables		-39,931	-27,532	-93,989	-90,036	-121,740
Other external costs		-16,713	-14,391	-45,195	-44,934	-58,868
Personnel costs		-33,390	-28,969	-103,780	-91,878	-124,575
Depreciation and impairment of
property, plant and equipment and		-13,661	-13,403	-41,145	-39,661	-53,266
intangible assets
Other operating expenses		-325	-225	-931	-1,323	-2,285
Total operating expenses		-104,020	-84,520	-285,039	-267,833	-360,733

Operating profit/loss (EBIT)		25,299	14,442	31,498	46,130	60,386

Financial income		3		57	2	2
Financial expenses		-1,090	-1,206	-3,221	-3,611	-4,820
Net financial items		-1,087	-1,207	-3,164	-3,610	-4,818

Share of profit after tax from
associated companies reported		35	92	176	180	347
according to the equity method
Profit/loss before tax		24,247	13,327	28,509	42,700	55,915

Income tax		-5,186	-3,567	-6,207	-10,158	-12,139
Net profit/loss for the period		19,061	9,761	22,302	32,542	43,776

Other comprehensive income:
Items that may be reclassified to
profit/loss for the period
Exchange rate differences from the translation of foreign operations		92	71	194	35	-389
Other comprehensive income for
the period, net of tax		92	71	194	35	-389
Total comprehensive income for
the period		19,153	9,832	22,496	32,577	43,387

Amounts in SEK	Jul-Sep 2021	Jul-Sep 2020	Jan-Sep 2021	Jan-Sep 2020	full-year 2020
Earnings per share before dilution*	0.79	0.40	0.92	1.36	1.82
Earnings per share after dilution*	0.79	0.40	0.92	1.36	1.82
Average number of shares	24,124,167 24,124,167		24,124,167	24,006,568	24,036,128
Number of shares outstanding on the reporting date	24.124.167 24.124.167		24.124.167	24.124.167	24.124.167

CONSOLIDATED STATEMENT OF FINANCIAL POSITION IN SUMMARY

Amounts in SEK 000 Note	30 Sep 2021	30 Sep 2020	31 Dec 2020

ASSETS
Non-current assets

Intangible assets
Capitalised development costs	1,183	2,046	1,830
Patents	288	317	299
Goodwill	7,290	7,322	7,274
Transportation licence	1,479	445	685
Total intangible assets	10,239	10,129	10,088

Property, plant and equipment বঁ Buildings and land		34,622	33,257
Locomotives and wagons	28,430 138,459	139,535	135,316
Mobile machinery	149,059	159,177	155,562
Vehicles	4,703	6,472	6,521
Equipment, tools, fixtures and fittings	6,239	6,084	5,898
Construction in progress	82,941	58,475	66,907
Total property, plant and equipment	409,830	404,365	403,461

Financial non-current assets
Holdings reported according to the equity method	808	665	832
Deposits		658	658
Deferred tax assets	1,002	108	925
Other non-current receivables	3,954	3,954	3,954
Total financial non-current assets	5,764	5,385	6,369

Total non-current assets	425,834	419,879	419,918

Current assets

Inventories
Raw materials and consumables	13,445	12,057	11,865
Work in progress	14,803	5,282	7,659
Total inventories	28,249	17,339	19,524
Current receivables
Accounts receivable	70,692	42,407	44,905
Current tax receivables	4		655
Other current receivables	1,620	219	1,809
Prepaid expenses and accrued income	8,955	8,646	9,792
Total current receivables	81,270	51,271	57,161

Cash and cash equivalents	5,073	16,507	24,785
Total current assets	114,591	85,117	101,470
TOTAL ASSETS	540,425	504,996	521,388

CONSOLIDATED STATEMENT OF FINANCIAL POSITION IN SUMMARY, cont.

Amounts in SEK 000	30 Sep 2021	30 Sep 2020	31 Dec 2020

EQUITY
Share capital	9,891	9,891	9,891
Other capital provided	36,565	36,565	36,565
Reserves	1,474	1,704	1,280
Retained earnings (comprehensive income for the period included)	154,952	135,892	147,126
Total equity attributable to Parent Company shareholders	202,882	184,052	194,862
LIABILITIES
Non-current liabilities
Deferred tax liabilities	38,279	27,557	38,170
Liabilities to credit institutions	126,540	107,974	107,659
Lease liability	41,569	38,377	33,654
Total non-current liabilities	206,387	173,909	179,483
Current liabilities
Lease liability	9.938	27,555	26,045
Liabilities to credit institutions	37,621	54,617	59,494
Accounts payable	40,158	22,970	25,139
Prepayments from customers	6,151	1,043	5,848
Current tax liabilities	2,807	7,595	861
Other liabilities	5,249	4,749	2,680
Accrued expenses and deferred income	29,232	28,507	26,977
Total current liabilities	131,155	147,035	147,044
TOTAL EQUITY AND LIABILITIES	540,425	504,996	521,388

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY IN SUMMARY

		Share	Other capital		Retained earnings (incl. profit for the
Amounts in SEK 000	Note	capital	provided	Reserves	period)	Total equity
Opening balance as of 1 January 2020		9,435	32,178	1,669	110,589	153,870
Net profit/loss for the period					32,542	32,542
Other comprehensive income				35		35
Total comprehensive income				35	32,542	32,577
Transactions with shareholders
Conversion of debenture		456	4,387			4,843
Dividend					-7,237	-7,237
Closing balance as of 30 September 2020		9,891	36,565	1,704	135,892	184,052
Opening balance as of 1 January 2021		9,891	36,565	1,280	147,126	194,862
Net profit/loss for the period					22,302	22,302
Other comprehensive income				194		194
Total comprehensive income				194	22,302	22,496
Transactions with shareholders
Dividend					-14,475	-14,475
Closing balance as of 30 September 2021		9,891	36,565	1,474	154,952	202,882

CONSOLIDATED CASH FLOW STATEMENT IN SUMMARY

	Jul-Sep	Jul-Sep	Jan-Sep	Jan-Sep	full-year
Amounts in SEK 000	2021 Note	2020	2021	2020	2020

Cash flow from operating activities
Operating profit	25,299	14,442	31,498	46,130	60,386
Adjustment for non-cash items	13,591	13,559	41,075	38,230	51,835
Interest paid	-1,089	-1,207	-3,221	-3,574	-4,784
Interest received	3		57		2
Income tax paid	-718	-1,171	-3,539	-2,268	-1,756
Cash flow from operating activities	37,086	25,623	65,870	78,518	105,683
before changes in working capital
Cash flow from changes in working
capital
Increase/decrease in inventories	-2,576	1,118	-8,821	5,032	2,788
Increase/decrease in operating
receivables	-27,952	5,305	-23,581	-20,636	-26,136
Increase/decrease in operating			19,371
liabilities	4,880	-2,950		-2,597	516
Total changes in working capital	-25,648	3,473	-13,031	-18,201	-22,832

Cash flow from operating activities	11,438	29,096	52,839	60,317	82,851

Cash flow from investment activities
Investments in intangible assets	-78		-951	-187	-462
Investments in property, plant and
equipment	-10,991	-17,044	-32,782	-41,701	-53,410
Acquisitions of subsidiaries, net effect
on cash and cash equivalents				-2,617	-2,617
Dividends from associated companies		-	200	200	200
Divestment of property, plant and
equipment	70		70	2,150	2,150
Cash flow from investment activities	-10,999	-17,044	-33,463	-42,155	-54,139


Cash flow from financing activities
Loans raised	19,200	8,000	19,200	24,020	34,020
Net change in overdraft facility Amortisation of loans	-4,726
Amortisation of lease liabilities	-6,355	-6,023	-22,192	-19,256	-24,006
	-7,200	-6,826	-21,900	-21,347	-28,600
Dividend paid			-14,475	-7,237	-7,237
Cash flow from financing activities	919	-4,849	-39,367	-23,820	-25,823

Cash flow for the period	1,358	7,203	-19,991	-5,658	2,889
Cash and cash equivalents at the
beginning of the period	3,684	9,270	24,785	22,012	22,012
Exchange rate difference in cash and
cash equivalents	31	34	279	153	-116
Cash and cash equivalents at the end		16,507
of the period	5,073		5,073	16,507	24,785

PARENT COMPANY INCOME STATEMENT IN SUMMARY

		Jul-Sep	Jul-Sep	Jan-Sep	Jan-Sep	full-year
Amounts in SEK 000	Note	2021	2020	2021	2020	2020
Net sales		10,130	6,782	28,155	23,999	30,189
Other operating income		6	67	194	127	127
Total operating income		10,136	6,849	28,350	24,126	30,316

Operating expenses
Raw materials and consumables		-7		-3.932	-3,299	-3,300
Other external costs		-2,754	-3,346	-9,219	-10,979	-14,168
Personnel costs		-3,814	-2,786	-13,388	-8,568	-11,937
Depreciation and impairment of property, plant and equipment and intangible assets		-99	-38	-299	-119	-163
Other operating expenses		-11	-12	-22	-42	-80
Total operating expenses		-6,684	-6,181	-26,860	-23,007	-29,648
Profit from participations in associated companies and jointly controlled companies				200	200	200
Operating profit		3,452	668	1,690	1,318	868
Profit/loss from financial items
Profit from participations in Group companies				2,404	4,346	4,346
Other interest income and similar profit/loss items					72	73
Interest expenses and similar profit/loss items		-48	-13	-70	-54	-53
Total profit/loss from financial items		-47	-13	2,334	4,364	4,366
Profit/loss after financial items		3,405	655	4,024	5,683	5,234
Appropriations						70
Tax on net profit/loss for the period		-711	-199	-337	-525	-547
Net profit/loss for the period		2,694	456	3,687	5,158	4,757

PARENT COMPANY BALANCE SHEET IN SUMMARY

Amounts in SEK 000	30 Sep 2021	30 Sep 2020	31 Dec 2020

ASSETS

intangible assets
Patents	288	317	299
Total intangible assets	288	317	299
Property, plant and equipment
Buildings	4,142	4,057	4,304
Equipment, tools, fixtures and fittings	272	327	344
Total property, plant and equipment	4,414	4,384	4,648

Financial non-current assets
Participations in Group companies	38,336	38,336	38,336
Participations in associated companies	204	204	204
Total financial non-current assets	38,540	38,540	38,540

Total non-current assets	43,242	43,241	43,487

Current assets
Current receivables
Accounts receivable	7
Receivables from Group companies	3.750	175	10.070
Other receivables			33
Prepaid expenses and accrued income	1,348	1,285	828
Total current receivables	5,105	1,460	10,931

Cash and cash equivalent	1,295	3,606	1,789

Total current assets	6,400	5,066	12,720

TOTAL ASSETS	49,642	48,308	56,207

PARENT COMPANY BALANCE SHEET IN SUMMARY, cont.

Amounts in SEK 000	30 Sep 2021	30 Sep 2020	31 Dec 2020

EQUITY AND LIABILITIES

Equity

Restricted equity
Share capital	9.891	9.891	9.891
Total restricted equity	9,891	9,891	9,891

Non-restricted equity
Share premium reserve	17,446	23,024	23,024
Retained earnings		4,140	4,140
Net profit/loss for the period	3,687	5,158	4,757
Total non-restricted equity	21,133	32,322	31,921

Total equity	31,024	42,213	41,812

Current liabilities
Accounts payable	1,784	1.923	966
Current tax liabilities	524	220	498
Liabilities to Group companies	11,479	397	10,028
Other liabilities	1,688	967	622
Accrued expenses and deferred income	3,142	2,588	2,281
Total current liabilities	18,618	6.095	14,395

TOTAL EQUITY AND LIABILITIES	49,642	48,308	56,207

Note

Note 1 General information

Railcare Group AB (publ) ("Railcare"), Corp. ID no. 556730-7813 is a Parent Company registered in Sweden with its registered office in Skellefteå, at the address Näsuddsvägen 10, SE-932 32 Skelleftehamn, Sweden.

Unless otherwise stated, all amounts are given in SEK thousands (SEK 000). Figures in brackets refer to the corresponding period in the previous year.

Basis of preparation for the financial statements Note 2

Railcare's consolidated accounts have been prepared in accordance with the Annual Accounts Act, the Swedish Financial Reporting Board's recommendation RFR 1 Supplementary Accounting Rules for Groups, International Financial Reporting Standards (IFRS) and the interpretations of the IFRS Interpretations Committee (IFRS IC) as adopted by the EU. This Interim Report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Annual Accounts Act.

The accounts of the Parent Company have been prepared in accordance with the Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2 Accounting for legal entities. The Interim Report for the Parent Company has been prepared in accordance with the Annual Accounts Act.

The accounting principles applied are consistent with those described in the Railcare Group's Annual Report 2020

The fair value of financial assets and liabilities is estimated to correspond to book value.

Note 3 Segment information

Description of segments and principal activities:

Railcare's Group Management is the highest executive decision-making body in the Railcare Group and evaluates the Group's financial position and earnings and makes strategic decisions. Company management has determined the operating segments based on the data processed by Group Management and which is used as a basis for allocating resources and evaluating results of operations.

Group Management has identified four reportable segments in the Group's operations: