Ratos — Interim / Quarterly Report 2011

Feb 16, 2012

Year-end report 2011

• ■ Profi t before tax SEK 860m (2,868)
• ■ Earnings per share before dilution SEK 1.63 (7.09)
• ■ Proposed dividend SEK 5.50 per share (5.25)
• ■ Weak development in the holdings in 2011, better in the fourth quarter
• ■ Refi nancing of holdings Stofa, SB Seating and Contex Group
• ■ Total return on Ratos shares -32%

Ratos in summary
SEKm	2011 Q 4	2010 Q 4	2011	2010
Profi t/share of profi ts	172	251	546	1,419
Total profi t/share of profi ts	172	251	546	1,419
Exit gains		537	525	1,320
Remeasurement/impairment	-312		-312	140
Profi t/loss from holdings	-140	788	759	2,879
Central income and expenses	65	33	101	-11
Profi t/loss before tax	-75	821	860	2,868

Important events

In the fourth quarter

• In December, a refi nancing was carried out in Stofa totalling DKK 425m (approximately SEK 515m), whereby Ratos receives a dividend of SEK 510m. Approximately SEK 420m was paid in January 2012 and approximately SEK 90m will be paid in March
• Bisnode signed an agreement in December to sell the company "Wer liefert Was?" (WLW) to the German private equity company Paragon Partners. The sale is part of Bisnode's strategy to focus on growth and development of its core business. The selling price amounts to EUR 79m (approximately SEK 710m) and is expected to generate a capital gain in

Bisnode of approximately EUR 20m. Average annual return (IRR) on Bisnode's investment in WLW amounts to approximately 29%. In conjunction with completion of this deal, Bisnode will issue a dividend of approximately SEK 215m to its owners, of which Ratos's share will amount to approximately SEK 150m

■ In December, SB Seating carried out a NOK 250m refi nancing and in conjunction with this decided to pay a total of NOK 273m (approximately SEK 315m) to the company's owners of which Ratos's share is SEK 303m (SEK 253m was paid in December and SEK 50m will be paid in March 2012)

Ratos year-end report 2011 1

• Contex Group has sold its subsidiaries Z Corporation and Vidar Systems to the American company 3D Systems Corporation (NYSE:DDD). The selling price (enterprise value) amounted to USD 137m (approximately SEK 920m). Upon completion of this deal in January, SEK 355m was distributed to the company's owners
• At the end of October, Stofa acquired part of Canal Digital's Danish cable TV business from Telenor. The purchase price (enterprise value) amounted to DKK 51m (SEK 62m). The acquisition is fi nanced with available liquid assets in Stofa
• In December, Euromaint completed the sale of its subsidiary Euromaint Industry to Coor Service Management for approximately SEK 100m (enterprise value)

In the fi rst to third quarter

• The sale of Medisize to Phillips Plastics was completed in August. The selling price for 100% of the shares amounted to EUR 99.8m (SEK 920m). Ratos's exit gain amounted to SEK 38m and the average annual return (IRR) was 4%
• Biolin Scientifi c's acquisition of the Danish company Sophion Bioscience was completed in August. The purchase price (enterprise value) for 100% of the company amounted to DKK 145m (SEK 179m) with an additional DKK 10m to be paid out if sales milestones for 2011/12 are met. Ratos provided SEK 65m in conjunction with the acquisition
• In July, Inwido paid a dividend totalling SEK 301m of which Ratos received SEK 290m
• Acquisition of Finnkino was completed in April. The purchase price (enterprise value) amounted to EUR 96.4m (SEK 861m), of which Ratos provided equity of EUR 45m (SEK 402m). Ratos's holding amounts to 98%. The seller was the media group Sanoma

• In April, Mobile Climate Control (MCC) completed its acquisition of Carrier's bus AC operations in North America for a purchase price (enterprise value) of USD 32.1m (SEK 200m). Ratos provided capital of SEK 114m in conjunction with the acquisition

• In March, a refi nancing was carried out in Anticimex totalling SEK 476m and in conjunction with this Ratos received a cash payment of SEK 405m

• In March, Arcus-Gruppen paid a dividend of NOK 140m, of which Ratos's share amounted to NOK 117m (SEK 132m)
• The sale of Superfos to RPC Group Plc was completed in February. The sale generated an exit result for Ratos of SEK -99m and an average annual return (IRR) of approximately 2%
• The acquisition of and public offer for Biolin Scientifi c were completed in February. Ratos's holding amounts to 100% and the purchase price amounted to SEK 306m, of which SEK 269m was paid in 2010. In September, Ratos was given advance access to the shares not submitted in the offer
• The sale of Ratos's holding in Camfi l to the company's principal owners was completed in January. The sale provided Ratos with an exit gain of SEK 586m and an average annual return (IRR) of 13%
• During the period, add-ons and divestments were carried out in holdings including Arcus-Gruppen, Bisnode and Inwido

Events after the end of the period

• The Board has decided to appoint Susanna Campbell, currently Investment Director at Ratos, as the new CEO with effect after the Annual General Meeting on 18 April 2012 has been held. At the same time, the Nomination Committee proposes that the present CEO Arne Karlsson is appointed Chairman of the Board at the Annual General Meeting. Ratos's Chairman Olof Stenhammar has after 18 years on the Board, including 14 as Chairman, declined re-election
• Leif Johansson, Deputy CEO and COO, will exercise his right to retire in summer 2013

More information about important events in the holdings in provided on pages 9-15.

CEO comments

The fragmented state of the world was refl ected in 2011 in the development for our holdings. Furthermore, our 19 companies had a slightly different development during the year than traditional Swedish export industry. This also applied in the fourth quarter which in many respects was the best in 2011. Several companies have also started 2012 with increased order bookings and stable conditions. For the overall portfolio of companies, however, the result for 2011 was a disappointment.

The macroeconomic conditions ahead of 2012 remain extremely tough and full of risks, in particular since the euro crisis is far from a permanent solution. In recent years a "struggle" has taken shape between an extremely easy monetary policy and a strict fi scal policy. Which of these forces gains the upper hand and/or in which area policy is changed fi rst, will determine economic development in 2012. Our macroeconomic forecast for 2012 is therefore summarised with the acronym TOW – Tug-of-War. Given our expectation for continued global modest growth (sub-par growth), our best assessment is that the prospects for improved earnings in our portfolio companies are good.

Arne Karlsson

Further CEO comments at www.ratos.se

Business environment and market

Ahead of 2011 Ratos's macroeconomic scenario was MOBBM, i.e. Make Or Break Becomes Make. The background to this acronym was that 2011 was expected to be a year in which many major, global macro economic questions must fi nd a solution, if the structural threats to growth were not to be further strengthened. So the world faced a Make or Break year – and our working hypothesis was that the answer would Become Make, i.e. that the various obstacles to recovery and somewhat more stable growth could be overcome.

On initial examination the global economy did develop entirely in line with this working hypothesis. The major problem areas solved themselves in a satisfactory manner (American growth, Chinese cool-down, the impact of high energy and commodity prices on consumption), or proved non-existent (threat of infl ation) or for the time being poorly handled (the euro crisis).

A somewhat deeper analysis, however, shows that this respite may very well prove temporary. The euro crisis is still far from a more permanent solution, the American political system is totally out of order and geo political and political risks – the fact for example that 2012 is an election year in countries that account for more than 50% of global GDP – mean that the risks are still many and major.

For this reason it is essential to constantly monitor global economic development and be prepared to make rapid adjustments to our view of the business environment if required. The companies in our portfolio must also continue to be prepared with internal crash plans, in the event economic growth ceases or is reversed.

For Ratos the 19 holdings, with their broad exposure to different sectors and geographies, refl ected the fragmented state of the world, with months, geographic areas and sectors fl uctuating between strong and weak demand. Taken overall, however, the earnings development in 2011 was a disappointment, largely due to three holdings with structural problems (DIAB, Hafa Bathroom Group and Jøtul) which accounted for approximately 75% of the decline compared with 2010.

2011	Sales	EBITA	EBT
Good development (9 companies)	+2%	+15%	+7%
Business cycle eff ect (7 companies)	±0%	-17%	-22%
Structural problems (3 companies)	-11%	n.a.	n.a.
	±0%	-18%	-31%
2011 Q 4	Sales	EBITA	EBT
Good development (9 companies)	+3%	+11%	+9%
Business cycle eff ect (7 companies)	+6%	+7%	+768%
Structural problems (3 companies)	-10%	n.a.	n.a.
	+4%	-15%	-24%

It can be noted that taken overall Ratos's holdings developed during the year somewhat differently from large sections of Swedish export industry. This also applied in the fourth quarter, which in many respects was the best in 2011. Several companies noted increased order bookings and activity towards the end of the year and therefore started 2012 with stable conditions.

At an aggregate level, combined sales for the underlying portfolio of companies was unchanged during the year. Taking Ratos's ownership stakes into account,

sales decreased by 1%. Corresponding fi gures for operating profi t (EBITA) were -18% and -17% respectively and for profi t before tax -31% and -34% respectively.

For Ratos 2011 was a year with a high level of activity on the transaction and refi nancing side, with a total of 18 major transactions. Two new acquisitions were made (Finnkino and the completion of the buyout of Biolin Scientifi c) at the same time as six holdings made add-on acquisitions (such as Arcus/Excellars, Biolin/Sophion and MCC/Carrier). Exits or partial exits were agreed in four cases (including Medisize and the sale of Z Corporation and Vidar from Contex), while six companies carried out refi nancing which resulted in

capital accruing to Ratos. In addition a number of minor transactions were carried out during 2011.

Conditions during the year became gradually tougher in both the transaction and fi nancing markets, but as Ratos's fi nal result shows both markets are still very much alive.

For 2012 our acronym which summarises the macroeconomic forecast is TOW – Tug-Of-War. In recent years a "struggle" has taken shape between two confl icting forces in economic policy: on the one hand an extremely easy monetary policy, on the other a strict fi scal policy. And global economic development will depend on which of these forces gains the upper hand and/or in which area policy is changed fi rst.

In our opinion this means that the forecast for multi-year economic development we have had since the Lehman crash in 2008 – sub-par growth, growth in the economy but below the long-term potential trend – will also apply in 2012. If we look at some key countries and regions this can be divided into a mild recession in Europe, weak growth in the US and a soft landing in China.

The macroeconomic conditions ahead of 2012 remain extremely tough and full of risks. If our main hypothesis that the world as a whole will continue to grow, although at a modest rate (sub-par growth), holds true, our best assessment is still that the prospects for improved earnings in our portfolio companies are good.

100%	2011 Ratos's share
0%	-1%
-18%	-17%
-31%	-34%
2011 Q 4
100%	Ratos's share
+4%	+2%
-15%	-8%
+24%	+7%

To facilitate analysis, an extensive table is provided on page 15 with key fi gures for Ratos's holdings. A summary of income statements, statements of fi nancial position, etc., for Ratos's associates and subsidiaries is available in downloadable Excel fi les at www.ratos.se.

Ratos's results

Profi t before tax for 2011 amounted to SEK 860m (2,868). The lower result is mainly due to a weaker earnings development in the holdings, lower exit gains and impairment of the value of the holding in Contex Group of SEK 312m. The result includes profi t/share of profi ts from the holdings of SEK 546m (1,419) and exit gains of SEK 525m (1,320).

Central income and expenses

Ratos's central income and expenses amounted to SEK 101m (-11), of which personnel costs in Ratos AB amounted to SEK 109m (167). The variable portion of personnel costs amounted to SEK 14m (68). Other management costs were SEK 82m (46). Net fi nancial items amounted to SEK +292m (+202).

Tax

Ratos's consolidated tax expense comprises subsidiaries' and Ratos's share of tax in associates. The tax rate in consolidated profi t or loss is affected, among other things, by the parent company's investment company status and by capital gains not liable to tax.

SEKm	2011	2010
Profi t/share of profi ts before tax 1)
AH Industries (69%)	-6	-24
Anticimex (85%)	84	127
Arcus-Gruppen (83%)	82	135
Biolin Scientifi c (100%) 2)	-10
Bisnode (70%)	106	274
Camfi l (30%) 3)		99
Contex Group (99%)	-14	43
DIAB (95%)	-51	149
Euromaint (100%)	-144	-165
Finnkino (98%) 4)	1
GS-Hydro (100%)	-13	-27
Hafa Bathroom Group (100%)	-18	37
Haglöfs (100%) 5)		5
HL Display (99%) 6)	24	13
Inwido (96%)	315	328
Jøtul (61%)	-113	25
KVD Kvarndammen (100%) 2)	42
Lindab (11%)	21	38
Medisize (98%) 7)	42	95
Mobile Climate Control (100%)	7	71
SB Seating (85%)	95	87
Stofa (99%) 8)	96	44
Superfos (33%) 9)		65
Total profi t/share of profi ts	546	1,419
Exit Camfi l	586
Exit Superfos	-99
Exit Medisize	38
Exit Haglöfs		783
Exit Lindab		537
Total exit result	525	1,320
Remeasurement HL Display		140
Impairment Contex Group	-312
Profi t from holdings	759	2,879
Central income and expenses
Management costs	-191	-213
Financial items	292	202
Consolidated profi t before tax	860	2,868

1) Subsidiaries' profi ts included with 100% and associates' profi ts with respective holding percentage.

2) Biolin Scientifi c and KVD Kvarndammen were acquired at the end of December 2010 and are not included in consolidated profi t for 2010.

3) Camfi l was sold at the beginning of January 2011 and is not included in consolidated profi t for 2011. Until the sale, Camfi l was recognised among Assets held for sale.

4) Finnkino is included in the Group from May 2011.

5) Haglöfs is included in consolidated profi t through July 2010. The entire holding was sold in August 2010.

6) HL Display is included with 29% through May 2010, in June and July with 61% and subsequently with 99%.

7) Medisize is included in consolidated profi t through July 2011. The entire holding was sold in August 2011.

8) Stofa is included in the Group from August 2010.

9) Superfos was recognised among Assets held for sale until it was sold in February and is thus not included in consolidated profi t for 2011.

Financial position

Cash fl ow from operating activities and investing activities was SEK 2,071m (588) and consolidated cash and cash equivalents at the end of the period amounted to SEK 3,042m (2,855), of which short-term interestbearing investments accounted for SEK 1m (351). Interest-bearing liabilities including pension provisions amounted to SEK 14,222m (14,207).

Parent company

The parent company's profi t before tax amounted to SEK 704m (1,608). The parent company's cash and cash equivalents, including short-term interest-bearing investments, amounted to SEK 897m (420). Taking into account fi nancial transactions agreed but not yet carried out, at 16 February Ratos has a net liquidity of approximately SEK 2 billion. In addition, there is an existing credit facility of SEK 3.2 billion and authorisation from the 2011 Annual General Meeting to issue 35 million Ratos B shares in conjunction with agreements on acquisitions.

Risks and uncertainties

A description of the Group's and parent company's material risks and uncertainties is provided in the Directors' report and in Note 31 and 38 in the 2010 Annual Report. An assessment for the coming months is provided in the Business environment and market section on page 3.

Related-party transactions

The parent company received dividends from subsidiaries and associates of SEK 843m (105). SB Seating has repaid SEK 253m of a shareholder loan. In April, Ratos provided capital to Mobile Climate Control amounting to SEK 114m for the acquisition of Carrier, and in August Ratos provided capital of SEK 65m to Biolin Scientifi c for the acquisition of Sophion Bioscience. A SEK 55m capital contribution has been provided to GS-Hydro.

Ratos shares

Earnings per share before dilution amounted to SEK 1.63 (7.09). The total return on Ratos shares in 2011 amounted to -32%, compared with the performance for the SIX Return Index which was -14%.

Treasury shares and number of shares

638,845 shares were repurchased during 2011. The number of call options exercised corresponded to 1,161,000 shares. At the end of December, Ratos owned 5,144,127 B shares (corresponding to 1.6% of the total number of shares), repurchased at an average price of SEK 69.

A division of shares (share split) was implemented in May and each existing share was divided into two shares of the same share class. The record date at Euroclear Sweden was 6 May 2011 and the fi nal trading day before the split was 3 May.

At 31 December the total number of shares in Ratos (A and B shares) amounted to 324,140,896 and the number of votes was 108,587,444. The number of outstanding shares was 318,996,769. The average number of B treasury shares in Ratos in 2011 was 5,104,197 (5,759,730 in 2010).

The Board has decided to propose that the 2012 Annual General Meeting gives the Board a renewed mandate to buy back shares in the company, during the period up to the next Annual General Meeting. Share buy-backs are to be effected on Nasdaq OMX Stockholm and are limited so that the company's holding of treasury shares at any time may not exceed 4% of all the shares in the company. The purpose of share buybacks is to give the Board greater freedom of action in its efforts to create value for Ratos's shareholders. This includes hedging of call options issued within the framework of Ratos's incentive programme.

Ratos's equity 1)

At 31 December 2011 Ratos's equity (attributable to owners of the parent) amounted to SEK 13,658m (SEK 14,139m at 30 September 2011), corresponding to SEK 43 per outstanding share (SEK 44 at 30 September 2011, adjusted for the share split).

SEKm	31 Dec 2011	% of equity
AH Industries	612	4
Anticimex	571	4
Arcus-Gruppen	505	4
Biolin Scientifi c	345	3
Bisnode	1,341	10
Contex Group	673	5
DIAB	1,001	7
Euromaint	715	5
Finnkino	398	3
GS-Hydro	-44	0
Hafa Bathroom Group	151	1
HL Display	1,008	7
Inwido	1,983	15
Jøtul	289	2
KVD Kvarndammen	392	3
Lindab	303	2
Mobile Climate Control	781	6
SB Seating	959	7
Stofa	703	5
Total	12,686	93
Other net assets in central companies	972	7
Equity (attributable to owners of the parent)	13,658	100
Equity per share, SEK	43

1) Holdings are shown at consolidated fi gures, which correspond to the Group's share of the holdings' equity, any residual values on consolidated surplus and defi cit values minus any intra-group profi ts. Shareholder loans and interest on such loans are also included.

Credit facilities

The parent company has a fi ve-year rolling credit facility of SEK 3.2 billion including a bank overdraft facility. The purpose of the facility is to be able to use it when bridge fi nancing is required for acquisitions, and to be able to fi nance dividends and day-to-day running costs in periods of few or no exits. The parent company should normally be unleveraged. The credit facility was unutilised at the end of the period.

Conversion of shares

The 2003 Annual General Meeting resolved that a conversion clause allowing conversion of A shares to B shares should be added to the articles of association. This means that owners of A shares have an ongoing right to convert them to B shares. During 2011, 5,000 A shares were converted to B shares.

Other

Proposal for ordinary dividend

The Board of Directors proposes an ordinary dividend for 2011 of SEK 5.50 per share (5.25). The record date for dividends is proposed as 23 April and dividends are expected to be paid from Euroclear Sweden on 26 April 2012.

Incentive programmes

The Board proposes that the Annual General Meeting decides on the issue of a maximum of 1,150,000 call options on Ratos class B treasury shares. It is proposed that the call options be offered to a maximum of approximately 30 key people working in the company. The call option programme comprises between 10,000 and 300,000 options per person. The exercise price will be set at 125% of the average for each trading day during the period 17-21 September 2012 of the highest and lowest prices for

Ratos B shares on Nasdaq OMX Stockholm according to the offi cial price list. The options will remain valid until and including 20 March 2017. The price of the options shall be determined as their assessed market value taking the share price during the measurement period into account. Purchasers of options will receive an extra remuneration, allocated over fi ve years, corresponding to a maximum of 50% of the option premium, provided the person concerned is still working at Ratos and still holds options acquired from Ratos or shares acquired through options.

In addition, as in the previous year the Board intends to propose to the Annual General Meeting an option programme related to the company's investments in portfolio companies. It is proposed that the programme be carried out through the issue of synthetic options.

The Board further proposes that the Meeting decides on a transfer of a maximum of 16,000 class B Ratos shares to administrative employees. Transfer may take place until the next Annual General Meeting to a maximum total of approximately 20 employees.

Additional information on the incentive programmes will be provided in the notice of the Annual General Meeting which will be published on 8 March 2012 and published on www.ratos.se.

Proposal on authorisation for new issues to be used at acquisitions

The Board proposes that the 2012 Annual General Meeting resolves, during the period until the next Annual General Meeting, to authorise the Board in conjunction with agreements on company acquisitions, on one or several occasions, with or without deviation from the pre-emptive rights of shareholders, for a cash payment, through set-off or non-cash, to make a decision on a new issue of class B shares in the company. This authorisation shall comprise a maximum of 35 million class B shares, which corresponds to 9.7% of the shares and 3.1% of the votes (after full utilisation of the mandate). The issue price will be determined in accordance with current market conditions.

Summary of background and reasons for the proposal

Ratos has had a mandate to use newly issued shares for fi nancing acquisitions since the 2009 Annual General Meeting. The Board is of the opinion that a continued new issue mandate is of decisive importance for implementation of Ratos's strategy. A new issue mandate is an effective instrument for Ratos's liquidity planning since it is diffi cult to co-ordinate acquisitions and exits in time. Through a new issue mandate Ratos can ensure that operating decisions are made on business grounds

and not on the basis of a temporary liquidity aspect. It is therefore the opinion of the Board that a new issue mandate is of strategic importance to ensure that Ratos can continuously take advantage of acquisition opportunities as they arise. The Board is of the opinion that a mandate to issue shares to be used at acquisitions will enable Ratos to:

• improve liquidity planning
• continuously participate in acquisition opportunities as they arise
• make acquisitions where the seller prefers Ratos shares to cash payment
• structure acquisitions in an optimal manner
• carry out larger and more deals

The reasons for an open mandate are (i) that it is not possible to determine when and to what extent it may be of interest to make acquisitions with shares as a means of payment and (ii) the long time axis for carrying out an issue would make it impossible to use Ratos shares without an open mandate. The mandate will only apply to possible acquisitions and if no acquisitions are completed where all or part of payment is made in the form of Ratos shares, no new issue will be made and the mandate will thus not be utilised.

Nomination Committee's proposal regarding Board of Directors

Ahead of the 2012 Annual General Meeting, Ratos's Nomination Committee proposes that the present CEO Arne Karlsson be elected as the new Chairman. Olof Stenhammar has declined re-election. The Nomination Committee further proposes re-election of Board members Lars Berg, Staffan Bohman, Annette Sadolin, Jan Söderberg, Per-Olof Söderberg and Margareth Øvrum.

Annual General Meeting

Ratos's Annual General Meeting will be held on 18 April 2012 at 17.00 CET in Stockholm Waterfront Congress Centre, Nils Ericsons Plan 4, Stockholm. Shareholders who wish to participate in the meeting must be entered in the share register kept by Euroclear Sweden no later than 12 April 2012, and notify their intention to attend no later than 16.00 CET on 12 April 2012. The Annual Report and other company documentation with basis for decision will be available at www.ratos.se from 9 March 2012. The notice of the Annual General Meeting will be published on 8 March 2012. Notifi cation of attendance may be made via www.ratos.se, by writing to Ratos, Box 1661, SE-111 96 Stockholm or by telephoning +46 8 700 17 00.

Holdings

More information about the holdings and a summary of income statements and statements of fi nancial position for Ratos's holdings is available in downloadable Excel fi les at www.ratos.se.

AH Industries

• Sales SEK 925m (978) and EBITA SEK 24m (55)
• Due to a continued weak earnings development, action programmes have been implemented including employee cutbacks and the closure of the Danish operations within Tower & Foundations
• Earnings were positively affected by compensation awarded in an arbitration with a former supplier
• Strong development within Site Solutions driven by offshore wind power and new customers
• Strong order bookings in the fourth quarter and a new breakthrough agreement signed with Vestas for 2012
• Continued uncertain market situation for the wind power industry in the short term

Ratos's holding in AH Industries amounted to 69% and the consolidated book value in Ratos was SEK 612m at 31 December 2011.

AH Industries is a world-leading supplier of metal components, modules, systems and services to the wind power and cement and minerals industries. The company is specialised in the manufacture and machining of heavy metal components with high precision requirements. Most of production is carried out in Jutland (Denmark) but the company also has operations in China.

Anticimex

• Sales SEK 1,927m (1,856) and EBITA SEK 192m (198)
• EBITA before items affecting comparability amounted to SEK 202m (198), corresponding to an operating margin of 10.5% (10.7) and sales increased during the period by 5% adjusted for currency effects
• Lower sales of property-related services, due to a reduced number of property transactions, had a negative effect on sales and margins in Sweden
• A number of new major contracts will have a positive impact on the company in 2012 and beyond
• Continued favourable development particularly in Norway, Finland and Germany
• SEK 476m refi nancing carried out in March, whereby Ratos received a cash payment of SEK 405m

Ratos's holding in Anticimex amounted to 85% and the consolidated book value in Ratos was SEK 571m at 31 December 2011.

Anticimex is a European service company that provides safe and healthy indoor environments through inspections, guarantees and insurance. Services include pest assurance, hygiene assurance, dehumidifi cation, fi re protection as well as property transfer and energy surveys. The Group has operations in Sweden, Finland, Denmark, Norway, Germany and the Netherlands.

Arcus-Gruppen

• Sales SEK 2,072m (1,944) and EBITA SEK 146m (156)
• Good sales growth (+10% in local currency) mainly driven by wine in Sweden and Norway. Stable spirits sales
• Strong operating profi t development. EBITA negatively affected by a net amount of SEK 50m mainly related to employee cutbacks prior to the move to a new factory and pension provisions. An additional SEK 120-140m in increased costs related to the move will be charged against earnings for 2012
• Acquisition of 51% of the Norwegian wine wholesaler Excellars and additional shares in Vingruppen during the year
• A NOK 140m distribution to owners in March, of which Ratos received NOK 117m (SEK 132m)

Ratos's holding in Arcus-Gruppen amounted to 83% and the consolidated book value in Ratos was SEK 505m at 31 December 2011.

Arcus-Gruppen is Norway's leading spirits producer and one of the largest wine suppliers in the Nordic region through Vingruppen, Vinordia and Arcus Wine Brands. The group's best-known brands include Braastad Cognac, Linie Aquavit, Løiten and Vikingfjord Vodka.

Biolin Scientifi c

• Sales SEK 232m (227) and EBITA SEK 15m (17) (pro forma taking into account acquisition of Sophion Bioscience and closure of the Farfi eld product area)
• Adjusted for currency effects sales rose 9%. Currency effects had negative effect on EBITA of approximately SEK 7m
• Good growth within Analytical Instruments and Discovery Instruments (Sophion). Stable development within Diagnostic Instruments (Osstell), new contracts expected to make positive contribution in 2012
• Farfi eld product area phased out due to weak sales and low potential in the product

Ratos's holding in Biolin Scientifi c amounted to 100% and the consolidated book value in Ratos was SEK 345m at 31 December 2011.

Biolin Scientifi c develops, manufactures and markets analytical instruments for research, development, quality control and clinical diagnostics. The company's largest market niche is nanotechnology, primarily materials science, cell analysis and biophysics. Customers are found worldwide and mainly comprise researchers in universities, research institutes and the industrial sector.

Bisnode

• Sales SEK 4,310m (4,451) and EBITA SEK 447m (536)
• Continued weak organic sales development (-2% adjusted for currency effects)
• Credit Solutions show continued good growth and earnings development. Very weak development for companies within Marketing Solutions and as expected lower sales of SPAR-related products
• EBITA before items affecting comparability amounted to SEK 526m (594), corresponding to an operating margin of 12% (13)
• Six companies were acquired and two companies were sold during the year. Agreement to sell WLW signed in December and expected to be completed during the fi rst quarter of 2012
• Lars Pettersson took over as CEO on 1 February 2012

Ratos's holding in Bisnode amounted to 70% and the consolidated book value in Ratos was SEK 1 341m at 31 December 2011.

Bisnode is a leading European provider of digital business information with services within market, credit and business information. Using Bisnode's services companies can increase their sales, reduce their risks and improve their day-to-day business decisions. Operations are conducted in 17 countries in Europe.

Contex Group

• Sales SEK 662m (750) and EBITA SEK 44m (97)
• Sale of subsidiaries Z Corporation and Vidar Systems completed in January 2012
• Sales for continuing operations, Contex A/S, amounted to SEK 316m and EBITA was SEK 24m
• Refi nancing carried out in January 2012 where Ratos received a dividend of SEK 355m. Net debt then amounted to USD 16m (SEK 110m)

Ratos's holding in Contex Group amounted to 99% and the consolidated book value in Ratos was SEK 673m at 31 December 2011.

The Danish company Contex Group is the worldleading manufacturer of advanced wide-format scanners. Contex sells under its own brand, and as an OEM supplier to companies including HP and Océ.

DIAB

• Sales SEK 1,219m (1,396) and EBITA SEK -5m (188)
• Substantial downturn in the wind segment in China due to offi cial directives on a temporary reduction in the rate of new wind power installations. China's long-term plans for wind power expansion remain positive, however
• Action programme implemented. Non-recurring costs mainly related to action programme charged against earnings with approximately SEK 40m
• Good sales development within the Transport, Industry and Aerospace segments
• Weak profi tability due to low sales volumes, low capacity utilisation and restructuring costs in conjunction with initiated action programme

Ratos's holding in DIAB amounted to 95% and the consolidated book value in Ratos was SEK 1,001m at 31 December 2011.

DIAB is a world-leading company that manufactures and develops core materials for composite structures including blades for wind turbines, hulls and decks for leisure boats, and components for aircraft, trains, industrial applications and buildings. The material has a unique combination of characteristics such as low weight, high strength, insulation properties and chemical resistance.

Euromaint

• Sales SEK 2,860m (2,814) and EBITA SEK 102m (-15) (pro forma taking discontinued and sold operations into account)
• Improved earnings development due to initiated action programmes, which reduced costs and raised productivity
• The Refurbishment business area has been closed down and is reported as a discontinued operation
• Euromaint Industry sold to Coor Service Management for approximately SEK 100m (enterprise value)

Ratos's holding in Euromaint amounted to 100% and the consolidated book value in Ratos was SEK 715m at 31 December 2011.

Euromaint is one of Europe's leading independent maintenance companies for the rail transport industry. The company's services and products guarantee the reliability and service life of track-mounted vehicles such as freight carriages, passenger trains, locomotives and work machines. Euromaint has operations in Sweden, Belgium, Latvia, the Netherlands and Germany.

Finnkino

• Sales SEK 799m (846) and EBITA SEK 77m (87)
• Good development since Ratos's acquisition (May 2011), EBITA (adjusted for non-recurring items) during the ownership period improved by EUR 1.8m compared with the same period last year
• Strong earnings development in the fourth quarter, particularly in the Baltic countries. Sales were stable
• Revenue from peripheral sales per admission rose 6%

Ratos's holding in Finnkino amounted to 98% and the consolidated book value in Ratos was SEK 398m at 31 December 2011.

Finnkino is the largest movie theatre chain in Finland and the Baltic countries with 25 movie theatres and 160 screens with a total of approximately 30,000 seats. The company also conducts fi lm distribution and some distribution of DVDs. The movie theatre operations are conducted under the name Finnkino in Finland and Forum Cinemas in the Baltic countries.

GS-Hydro

• Sales SEK 1,074m (1,244) and EBITA SEK 31m (27)
• Weaker sales due to market downturn for the company's customers and a late-cyclical position. The underlying trend has improved, however, and order bookings were good during the second half
• Cost-cutting measures implemented to adapt operations to the lower volume
• Ratos provided SEK 55m in the third quarter to strengthen the company's capital structure

Ratos's holding in GS-Hydro amounted to 100% and the consolidated book value in Ratos was SEK -44m at 31 December 2011 (negative value due to refi nancing in 2008).

GS-Hydro is a leading supplier of non-welded piping systems. Products are mainly used in the marine and offshore industries as well as in the pulp and paper, metals and mining and automotive and aerospace industries. The head offi ce is located in Finland.

Hafa Bathroom Group

• Sales SEK 324m (407) and EBITA SEK -5m (46)
• Lower sales due to a terminated customer contract as well as sharp falls in the consumer market. Adjusted for the terminated contract, sales decreased by 2%
• Signifi cant new contracts concluded and under implementation
• Weak earnings development due to lower volumes, costs related to aggressive marketing, construction of new product displays and costs for cost-cutting measures
• Operations in Denmark have been phased out and are reported as discontinued operations

Ratos's holding in Hafa Bathroom Group amounted to 100% and the consolidated book value in Ratos was SEK 151m at 31 December 2011.

Hafa Bathroom Group with the Hafa and Westerbergs brands is one of the Nordic region's leading bathroom interiors companies.

HL Display

• Sales SEK 1,643m (1,617) and EBITA SEK 64m (66)
• Sales increased by 8% adjusted for currency effects. Growth in all regions, but strongest in Asia, Southern Europe and Northern Europe
• Currency effects had a negative impact on EBITA of approximately SEK 31m
• Manufacture in Karlskoga, Sweden, was relocated to Poland during the third quarter and a decision was made to close and relocate the factory in Falun, Sweden. Restructuring costs of approximately SEK 40m were charged against profi t for the year

Ratos's holding in HL Display amounted to 99% and the consolidated book value in Ratos was SEK 1,008m at 31 December 2011.

HL Display is a global, market-leading supplier of products and systems for merchandising and in-store communication with operations in 47 countries. Manufacture takes place in China, Poland, the UK and Sweden.

Inwido

• Sales SEK 5,050m (5,149) and EBITA SEK 407m (446)
• Good growth in the industry segment while consumer demand was cautious. Increased market shares in the Nordic region during the year
• Streamlining of production structure is underway and factories in Denmark, Sweden and Russia have been closed down
• EBITA was negatively affected by costs affecting comparability related to the streamlining of SEK 69m (80), of which SEK 3m (60) in the fourth quarter
• Danish window manufacturer Pro Tec acquired in 2011
• Inwido paid a dividend of SEK 301m in July, of which Ratos's share amounted to SEK 290m

Ratos's holding in Inwido amounted to 96% and the consolidated book value in Ratos was SEK 1,983m at 31 December 2011.

Inwido develops, manufactures and sells a full range of windows and doors to consumers, construction companies and prefabricated home manufacturers. Operations are conducted in all the Nordic countries as well as in the UK, Ireland, Poland and Russia. The company's brands include Elitfönster, SnickarPer, Tiivi, KPK, Lyssand and Allan Brothers.

Jøtul

• Sales SEK 996m (1,044) and EBITA SEK -33m (97)
• Very weak development during the fourth quarter due to the warm start to the winter
• Earnings charged with SEK 27m for the full year related to inventories impairment, guarantee provisions and employee cutbacks
• Arve Johan Andresen new CEO from 1 November 2011. At the end of the year and the beginning of 2012 the company's management was reorganised and employee cutbacks implemented

Ratos's holding in Jøtul amounted to 61% and the consolidated book value in Ratos was SEK 289m at 31 December 2011.

The Norwegian company Jøtul is Europe's largest manufacturer of stoves and fi replaces with production facilities in Norway, Denmark, France, Poland and the US. The company dates back to 1853 and the products are sold worldwide, primarily through speciality stores, but also through the DIY trade.

KVD Kvarndammen

• Sales SEK 276m (239) and EBITA SEK 52m (32)
• Strong performance, sales +16%, operating EBITA +18% (costs affecting comparability in conjunction with acquisition charged against EBITA with SEK 12m for 2010)
• Increased market share in Cars business area
• Higher average selling prices contributed to increased revenue per item
• New mobile site launched (m.kvd.se)

Ratos's holding in KVD Kvarndammen amounted to 100% and the consolidated book value in Ratos was SEK 392m at 31 December 2011.

KVD Kvarndammen is Sweden's largest independent online marketplace offering broker services for capital goods. The company, which was founded in 1991, runs kvd.se where cars, heavy vehicles and machines are offered for sale at weekly online auctions. The number of unique visitors totals approximately 200,000 per week. The company includes Sweden's largest valuation portal for cars, bilpriser.se.

Lindab

• Sales SEK 6,878m (6,527) and EBITA SEK 348m (401)
• Sales increased by 9% adjusted for currency effects, acquisitions and divestments
• Operating EBITA amounted to SEK 407m (354)
• Good growth and earnings development in the fourth quarter

Ratos's holding in Lindab amounted to 11% and the consolidated book value in Ratos was SEK 303m at 31 December 2011.

Lindab is a leading European company within development, production, marketing and distribution of systems and products in sheet metal and steel for the construction industry. The group is established in 31 countries. Approximately 50% of sales go to countries outside the Nordic region. Lindab is listed on Nasdaq OMX Stockholm, Mid Cap List.

Mobile Climate Control (MCC)

• Sales SEK 1,048m (902) and EBITA SEK 45m (112)
• Acquisition of Carrier's North American operations within bus AC completed in April
• Increased sales as a result of the acquisition. Demand from the military and bus segment negatively affected by budget savings in North America while other operations developed well
• Consolidation of European production to Poland and closure of the factory in Norrtälje, Sweden, initiated
• Less favourable earnings development due to negative currency effects, higher raw material prices, a changed customer mix and non-recurring costs (SEK 58m) mainly related to factory closures and acquisition and integration costs

Ratos's holding in Mobile Climate Control amounted to 100% and the consolidated book value in Ratos was SEK 781m at 31 December 2011.

Mobile Climate Control (MCC) offers complete climate comfort systems for three main customer segments: buses, off road and military vehicles. Approximately 80% of the company's sales take place in North America and 20% in Europe. Major production plants are located in Toronto (Canada), Goshen (USA) and Olawa (Poland).

SB Seating

• Sales SEK 1,264m (1,203) and EBITA SEK 253m (197)
• Strong fourth quarter with 5% growth in local currency and EBITA margin of 21% (14)
• During the year sales in local currency increased by 6% and EBITA by 32%. Very good development in Sweden, Norway, Germany and France. Weak development in the UK and the Netherlands
• Improved EBITA margin, 20% (16), due to increased volumes and completed action programmes
• NOK 250m refi nancing carried out in December and in conjunction with this it was decided to pay a total of NOK 273m (approximately SEK 315m) to the company's owners. Ratos's share amounts to SEK 303m, of which SEK 253m was paid in December and SEK 50m will be paid in March 2012

Ratos's holding in SB Seating amounted to 85% and the consolidated book value in Ratos was SEK 959m at 31 December 2011.

SB Seating develops and produces ergonomic offi ce chairs in Scandinavian design for private and public environments. The group markets three strong brands, HÅG, RH and RBM, which are mainly sold through retail outlets. The group is represented today in Norway, Sweden, Denmark, Germany, the UK, the Netherlands and France.

Stofa

• Sales SEK 1,390m (1,411) and EBITA SEK 146m (117)
• Sales in local currency increased by 4%
• EBITA affected by SEK 32m (24) in non-recurring costs related to employee cutbacks and acquisitions
• Increased sales of broadband, TV programmes and add-on services made a positive contribution to sales and profi tability
• Klaus Høeg-Hagensen new CEO from 1 August 2011
• Stofa acquired part of Canal Digital's Danish cable TV business at the end of October. The purchase price (enterprise value) amounted to DKK 51m (approximately SEK 62m)
• Refi nancing completed in fi rst quarter of 2012, whereby Ratos will receive a total of approximately SEK 510m

Ratos's holding in Stofa amounted to 99% and the consolidated book value in Ratos was SEK 703m at 31 December 2011.

Stofa is a Danish triple-play operator (broadband, cable TV and telephony) which provides some 350,000 Danish households with cable TV and 50% of them with broadband as well. The services are delivered in close cooperation with 300 antenna associations throughout Denmark. In addition, Stofa also sells to end-user subscribers who are offered interactive TV services (pay TV), broadband and IP telephony.

Ratos's holdings at 31 December 2011

		Net sales		EBITA		EBT A)
SEKm	2011	2010	2011	2010	2011	2010
AH Industries 1)	925	978	24	55	-6	26
Anticimex 2)	1,927	1,856	192	198	113	139
Arcus-Gruppen 3)	2,072	1,944	146	156	78	116
Biolin Scientifi c 4)	232	227	15	17	0	2
Bisnode	4,310	4,451	447	536	203	376
Contex Group	662	750	44	97	-15	43
DIAB	1,219	1,396	-5	188	-50	149
Euromaint 5)	2,860	2,814	102	-15	52	-79
Finnkino 6)	799	846	77	87	21	32
GS-Hydro	1,074	1,244	31	27	-13	-27
Hafa Bathroom Group 7)	324	407	-5	46	-2	45
HL Display 8)	1,643	1,617	64	66	24	29
Inwido	5,050	5,149	407	446	315	328
Jøtul	996	1,044	-33	97	-66	67
KVD Kvarndammen 9)	276	239	52	32	42	22
Lindab	6,878	6,527	348	401	186	112
Mobile Climate Control	1,048	902	45	112	7	71
SB Seating	1,264	1,203	253	197	196	180
Stofa 10)	1,390	1,411	146	117	96	83
Total	34,950	35,004	2,351	2,859	1,183	1,716
Change		0%		-18%		-31%

SEKm	Depreciation B) 2011	Investment C) 2011	Cash fl ow D) 2011	Equity E) 31 Dec 2011	Interest-bearing net debt E) 31 Dec 2011	Average no. employees 2011	Consolidated value 31 Dec 2011	Ratos's holding 31 Dec 2011
AH Industries 1)	55	51	-11	879	371	457	612	69%
Anticimex 2)	42	60	118	644	768	1,338	571	85%
Arcus-Gruppen 3)	34	63	31	634	16	469	505	83%
Biolin Scientifi c 4)	7	–	–	351	149	141	345	100%
Bisnode	130	133	212	2,359	2,427	3,016	1,341	70%
Contex Group	43	55	17	1,003	660	302	673	99%
DIAB	90	67	-88	1,142	888	1,389	1,001	95%
Euromaint 5)	57	–	–	737	647	2,442	715	100%
Finnkino 6)	68	–	–	405	318	794	398	98%
GS-Hydro	24	10	31	323	529	608	-44	100%
Hafa Bathroom Group 7)	5	2	45	40	58	176	151	100%
HL Display 8)	36	53	22	1,123	469	1,140	1,008	99%
Inwido	133	81	469	2,227	1,372	3,523	1,983	96%
Jøtul	57	73	-78	546	621	713	289	61%
KVD Kvarndammen 9)	5	2	29	392	144	177	392	100%
Lindab	163	143	231	2,699	1,746	4,484	303	11%
Mobile Climate Control	16	13	60	807	570	630	781	100%
SB Seating	42	33	187	1,055	766	479	959	85%
Stofa 10)	101	143	209	710	482	400	703	99%

A) Earnings with restored interest expenses on shareholder loan.

B) Depreciation includes depreciation and impairment of property, plant and equipment as well as internally generated and directly acquired intangible assets. Depreciation and impairment are included in EBITA.

C) Investments excluding business combinations.

D) Cash fl ow refers to cash fl ow from operating activities including paid interest and investing activities before acquisition and disposal of companies.

• E) Equity includes shareholder loans. Interest-bearing debt excludes shareholder loans.
• 1) AH Industries' earnings and average number of employees for 2010 are pro forma taking the acquisition of RM Group into account.
• 2) Anticimex's earnings for 2010 and 2011 are pro forma taking new fi nancing into account.

• 3) Arcus-Gruppen's earnings for 2010 and 2011 are pro forma taking new fi nancing into account.

• 4) Biolin Scientifi c's earnings for 2010 and 2011 are pro forma taking into account a new group structure, acquisition of Sophion Bioscience in August 2011, new fi nancing and discontinuation of Farfi eld.

• 5) Euromaint's earnings and average number of employees for 2010 and 2011 are pro forma taking into account discontinued operations (Refurbishment) and the sale of Euromaint Industry.
• 6) Finnkino's earnings for 2010 and 2011 are pro forma taking Ratos's acquisition into account.
• 7) Hafa Bathroom Group's earnings for 2010 and 2011 are pro forma taking discontinued operations in Denmark into account.
• 8) HL Display's earnings for 2010 are pro forma taking into account the refi nancing in August 2010.
• 9) KVD Kvarndammen's earnings for 2010 are pro forma taking Ratos's acquisition into account.
• 10) Stofa's earnings and average number of employees for 2010 are pro forma taking Ratos's acquisition into account.

Telephone conference

16 February 10.00 CET

+46 8 505 201 10

Listen to CEO Arne Karlsson's comments on this report at www.ratos.se

Financial calendar

2012
18 April	Annual General Meeting
8 May	Interim report Jan-March
17 Aug	Interim report Jan-June
9 Nov	Interim report Jan-Sept

Stockholm, 16 February 2012 Ratos AB (publ)

Arne Karlsson CEO

For further information, please contact: Arne Karlsson, CEO, +46 8 700 17 00 Emma Rheborg, Head of Corporate Communications and IR, +46 8 700 17 20

This report has not been reviewed by Ratos's auditors.

This information is disclosed pursuant to the Swedish Securities Market Act, the Swedish Financial Instruments Trading Act or requirements stipulated in the listing agreement.

Consolidated income statement

SEKm	2011 Q 4	2010 Q 4	2011	2010
Net sales	7,985	7,870	29,669	27,953
Other operating income	44	168	215	376
Change in inventories	-157	394	-64	27
Raw materials and consumables	-3,009	-3,296	-11,385	-10,411
Employee benefi t costs	-2,462	-2,527	-9,529	-8,941
Depreciation and impairment of property, plant and equipment and intangible assets	-610	-325	-1,470	-1,050
Other costs	-1,714	-1,788	-6,272	-6,097
Remeasurement HL Display				140
Capital gain/loss from the sale of group companies	-6	-4	27	774
Capital gain/loss from the sale of associates	-2	537	485	537
Share of profi ts of associates	5	34	33	253
Operating profi t	74	1,063	1,709	3,561
Financial income	66	74	155	253
Financial expenses	-215	-316	-1,004	-946
Net fi nancial items	-149	-242	-849	-693
Profi t before tax	-75	821	860	2,868
Tax	-103	-73	-314	-455
Profi t/loss for the period	-178	748	546	2,413
Profi t for the period attributable to:
Owners of the parent	-184	687	521	2,255
Non-controlling interests	6	61	25	158
Earnings per share, SEK
– before dilution	-0.58	2.16	1.63	7.09
– after dilution	-0.58	2.15	1.63	7.07

Consolidated statement of comprehensive income

SEKm	2011 Q 4	2010 Q 4	2011	2010
Profi t/loss for the period	-178	748	546	2,413
Other comprehensive income:
Translation diff erences for the period	-287	-54	-38	-1,153
Change in hedging reserve for the period	-9	34	-24	95
Tax attributable to other comprehensive income	3	-6	7	-22
Other comprehensive income for the period	-293	-26	-55	-1,080
Total comprehensive income for the period	-471	722	491	1,333
Total comprehensive income for the period attributable to:
Owners of the parent	-426	672	478	1,352
Non-controlling interests	-45	50	13	-19

Summary consolidated statement of fi nancial position

SEKm	31 Dec 2011	31 Dec 2010
ASSETS
Non-current assets
Goodwill	20,483	20,304
Other intangible assets	1,541	1,621
Property, plant and equipment	4,286	4,050
Financial assets	785	808
Deferred tax assets	617	632
Total non-current assets	27,712	27,415
Current assets
Inventories	2,684	2,884
Current receivables	6,291	6,291
Cash and cash equivalents	3,042	2,855
Assets held for sale	193	1,318
Total current assets	12,210	13,348
Total assets	39,922	40,763
EQUITY AND LIABILITIES
Equity including non-controlling interests	14,655	16,465
Non-current liabilities
Interest-bearing liabilities	11,667	10,923
Non-interest bearing liabilities	845	405
Pension provisions	410	412
Other provisions	396	431
Deferred tax liabilities	690	778
Total non-current liabilities	14,008	12,949
Current liabilities
Interest-bearing liabilities	2,145	2,872
Non-interest bearing liabilities	8,307	7,851
Provisions	718	626
Liabilities attributable to assets held for sale	89
Total current liabilities	11,259	11,349
Total equity and liabilities	39,922	40,763

Summary statement of changes in consolidated equity

	31 Dec 2011			31 Dec 2010
SEKm	Owners of the parent	Non- controlling interests	Total equity	Owners of the parent	Non- controlling interests	Total equity
Opening equity	15,091	1,374	16,465	15,302	1,500	16,802
Adjusted for changed accounting principle				-25		-25
Eff ect of adopted purchase price allocation	-23		-23
Adjusted equity	15,068	1,374	16,442	15,277	1,500	16,777
Total comprehensive income
for the year	478	13	491	1,352	-19	1,333
Dividend	-1,678	-130	-1,808	-1,512	-23	-1,535
New issue		10	10	43	145	188
Transfer of treasury shares (at acquisitions) in associates				10		10
Purchase of treasury shares	-74		-74	-34		-34
Transfer of treasury shares (exercise of call options)	88		88	80		80
Option premiums	6		6	9		9
Redemption of convertible programme in associates				-8		-8
Put option, future acquisition from non-controlling interest		-215	-215
Acquisition of non-controlling interests	-230	-140	-370	-117	-234	-351
Disposal of non-controlling interests					1	1
Redemption of options in subsidiary				-9		-9
Non-controlling interests at acquisition		99	99		32	32
Non-controlling interests in disposals		-14	-14		-28	-28
Closing equity	13,658	997	14,655	15,091	1,374	16,465

Consolidated statement of cash fl ows

Operating activities Profi t before tax 860 Adjustment for non-cash items 1,034 1,894 2,247 Income tax paid -316 Cash fl ow from operating activities before change in working capital 1,578 1,997 Cash fl ow from change in working capital Increase (-)/Decrease (+) in inventories 64 Increase (-)/Decrease (+) in operating receivables -146 Increase (+)/Decrease (-) in operating liabilities 212 Cash fl ow from operating activities 1,708 Investing activities Acquisition, group companies -1,531 Disposal, group companies 913 Acquisition, shares in associates -4 Disposal, shares in associates 1,876 Acquisition other intangible/tangible assets -956 Disposal, other intangible/tangible assets 33 Investment, fi nancial assets -19 Disposal, fi nancial assets 51 Cash fl ow from investing activities 363 Financing activities Purchase of treasury shares -74 -34 Exercise of options 40 71 Option premiums 13 Acquisition of non-controlling interests (minority) -237 -271 Dividend paid -1,678 -1,512 Dividend paid/redemption, non-controlling interests -130 -23 Borrowings 6,097 987 Amortisation of loans -5,930 -1,880 Cash fl ow from fi nancing activities -1,899 Cash fl ow for the year 172	SEKm	2011	2010
			2,868
			-621
			-250
			-2
			254
			-447
			1,802
			-2,032
			1,118
			-488
			858
			-710
			76
			-67
			31
			-1,214
			26
			-2,636
			-2,048
	Cash and cash equivalents at beginning of the year	2,855	4,999
Exchange diff erences in cash and cash equivalents 15			-96
Cash and cash equivalents at the end of the year 3,042			2,855

Consolidated key fi gures 1)

	2011 Q 4	2010 Q 4	2011	2010
Return on equity, %			4	15
Equity ratio, %			37	40
Key fi gures per share
Total return, %			-32	40
Dividend yield, %			6.8 2)	4.2
Market price, SEK			80.75	124.50
Dividend, SEK			5.50 2)	5.25
Equity attributable to owners of the parent, SEK			43	47
Earnings per share before dilution, SEK			1.63	7.09
Average number of shares outstanding
– before dilution	318,996,769	318,474,614	319,036,699	318,134,920
– after dilution	318,996,769	319,176,700	319,288,848	318,752,700
Total number of registered shares			324,140,896	324,140,896
Number of shares outstanding			318,996,769	318,474,614
– of which A shares			84,637,060	84,647,060
– of which B shares			234,359,709	233,827,554

1) Relevant historical fi gures are recalculated taking the 2011 share split into account.

2) Proposed dividend.

Parent company income statement

SEKm	2011 Q 4	2010 Q 4	2011	2010
Other operating income		100	1	104
Other external costs	-17	-52	-79	-139
Personnel costs	-11	-48	-109	-167
Depreciation of property, plant and equipment	-1	-1	-5	-5
Operating profi t/loss	-29	-1	-192	-207
Capital gain from sale of investments in group companies			107	932
Dividends from group companies			827	93
Impairment of shares in group companies	-322	-4	-322	-4
Reversed impairment of shares in group companies			37
Capital gain from sale of interests in associates		737	78	737
Dividends from associates			16	12
Impairment of interests in associates	-7	-3	-7	-3
Result from other securities and receivables
accounted for as non-current assets	49	10	175	116
Other interest income and similar profi t/loss items	-6	2	27	7
Interest expenses and similar profi t/loss items	-9	-6	-42	-75
Profi t/loss after fi nancial items	-324	735	704	1,608
Tax
Profi t/loss for the period	-324	735	704	1,608

Parent company statement of comprehensive income

SEKm	2011 Q 4	2010 Q 4	2011	2010
Profi t/loss for the period	-324	735	704	1,608
Other comprehensive income:
Change in fair value reserve for the period	-6	0	0	-21
Other comprehensive income for the period	-6	0	0	-21
Comprehensive income for the period	-330	735	704	1,587

Summary parent company balance sheet

SEKm	31 Dec 2011	31 Dec 2010
ASSETS
Non-current assets
Property, plant and equipment	82	87
Financial assets	12,540	13,711
Total non-current assets	12,622	13,798
Current assets
Current receivables	67	43
Cash and cash equivalents	897	420
Total current assets	964	463
Total assets	13,586	14,261
EQUITY AND LIABILITIES
Equity	12,541	13,493
Non-current provisions
Pension provisions	1	2
Other provisions	16	31
Non-current liabilities
Interest-bearing liabilities, group companies	620	272
Non-interest bearing liabilities	36	99
Current provisions	20
Current liabilities
Interest-bearing liabilities, group companies	260	184
Non-interest bearing liabilities	92	180
Total equity and liabilities	13,586	14,261
Pledged assets and contingent liabilities	none	none

Summary statement of changes in parent company's equity

SEKm	31 Dec 2011	31 Dec 2010
Opening equity	13,493	13,321
Comprehensive income for the year	704	1,587
Dividend	-1,678	-1,512
Purchase of treasury shares	-74	-34
New issue		43
Transfer of treasury shares (exercise call options)	88	80
Option premiums	8	8
Closing equity	12,541	13,493

Parent company cash fl ow statement

SEKm	2011	2010
Operating activities
Profi t before tax	704	1,608
Adjustment for non-cash items	-45	-1,759
	659	-151
Income tax paid	–	–
Cash fl ow from operating activities before change
in working capital	659	-151
Cash fl ow from change in working capital
Increase (-)/Decrease (+) in operating receivables	-19	-11
Increase (+)/Decrease (-) in operating liabilities	-64	-128
Cash fl ow from operating activities	576	-290
Investing activities
Investment, shares in subsidiaries	-909	-2,513
Disposal and redemption, shares in subsidiaries	1,738	1,489
Investment, shares in associates and other holdings		-484
Disposal, shares in associates and other holdings	549	855
Acquisition, property, plant and equipment	-1	-2
Investment, fi nancial assets	-126	-40
Disposal, fi nancial assets	61	80
Cash fl ow from investing activities	1,312	-615
Financing activities
Purchase of treasury shares	-74	-34
Transfer of treasury shares (exercise call options)	88	80
Option premiums	10	11
Redemption incentive programme	-47
Dividend paid	-1,678	-1,512
Loans raised in group companies	290	4
Cash fl ow from fi nancing activities	-1,411	-1,451
Cash fl ow for the year	477	-2,356
Cash and cash equivalents at the beginning of the year	420	2,776
Cash and cash equivalents at the end of the year	897	420

Operating segments

	Sales				EBT I)
SEKm	2011 Q 4	2010 Q 4	2011	2010	2011 Q 4	2010 Q 4	2011	2010
Holdings
AH Industries	267	240	925	611	$-2$	$-13$	$-6$	$-24$
Anticimex	509	486	1,927	1,856	16	40	84	127
Arcus-Gruppen	681	604	2,072	1,944	94	84	82	135
Biolin Scientific 2)	77		180		$-13$		$-10$
Bisnode	1,166	1,163	4,310	4,451	57	85	106	274
Camfil 3)						20		99
Contex Group	172	198	662	750	$-52$	6	$-14$	43
DIAB	295	316	1,219	1,396	$-35$	4	$-51$	149
Euromaint	782	949	3,329	3,532	$-37$	$-86$	$-144$	$-165$
Finnkino 4)	216		543		9		$\overline{\phantom{a}}$
GS-Hydro	311	294	1,074	1,244	9	$-48$	$-13$	$-27$
Hafa Bathroom Group	82	100	335	424	$\mathbf{2}$	$-$	$-18$	37
Haglöfs 5)				289				5
HL Display 6)	410	392	1,643	662	$-12$	$-7$	24	3
Inwido	1,410	1,391	5,050	5,149	106	41	315	328
stul	343	384	996	1,044	$-51$	52	$-113$	25
KVD Kvarndammen 2)	77		276		12		42
Lindab					3	$-5$	21	38
Medisize 7)		253	617	1,079		$\overline{10}$	42	95
Mobile Climate Control	276	$217$	1,048	902	8	$\overline{4}$	$\overline{7}$	71
SB Seating	352	329	1,264	1,203	40	16	95	87
Stofa 8)	382	365	1,390	600	8	32	96	44
Superfos 9)						7		65
Total	7,808	7,681	28,860	27,136	172	251	546	1,419
Exit Camfil							586
Exit Superfos							$-99$
Exit Medisize							38
Exit Haglöfs								783
Exit Lindab						537		537
Exit gains					0	537	525	1,320
Remeasurement HL Display								140
Impairment Contex Group					$-312$		$-312$
Holdings total	7,808	7,681	28,860	27,136	$-140$	788	759	2,879
Central income and expenses	177	189	809	817	65	33	0	-11
Group total	7,985	7,870	29,669	27,953	$-75$	821	860	2,868

1) Subsidiaries' profi ts included with 100% and associates' profi ts with respective holding percentage.

2) Biolin Scientifi c and KVD Kvarndammen were acquired at the end of December 2010 and are not included in consolidated profi t for 2010.

3) Camfi l was sold at the beginning of January 2011 and is not included in consolidated profi t for 2011. Until the sale, Camfi l was recognised among Assets held for sale.

4) Finnkino is included in the Group from May 2011.

5) Haglöfs is included in consolidated profi t through July 2010. The entire holding was sold in August 2010.

6) HL Display is included with 29% through May 2010, in June and July with 61% and subsequently with 99%.

7) Medisize is included in consolidated profi t through July 2011. The entire holding was sold in August 2011.

8) Stofa is included in the Group from August 2010.

9) Superfos was recognised among Assets held for sale until it was sold in February and is thus not included in consolidated profi t for 2011.

Accounting principles in accordance with IFRS

The consolidated fi nancial statements are prepared in accordance with International Financial Reporting Standards (IFRS). The interim report is prepared in accordance with IAS 34, Interim Financial Reporting. Pertinent regulations in the Swedish Annual Accounts Act are also applied.

The parent company's interim report is prepared in accordance with the Annual Accounts Act which is in accordance with the regulations in RFR 2 Accounting for Legal Entities.

The accounting principles and basis of calculation are the same as those applied for the Group and the parent company in preparation of the most recent annual report. IFRS requires uniform accounting principles within a group.

New accounting principles for 2011

The revised IFRS standards and interpretations from IFRIC which come into force in 2011 have not had any material effect on the performance, fi nancial position or disclosures of the Group or parent company.

Signifi cant accounting and valuation principles

A brief summary of Ratos's key accounting principles is provided below.

Business combinations

IFRS 3 Business Combinations and IAS 27 Consolidated and Separate Financial Statements are applied to acquisitions of subsidiaries. How an acquisition/ disposal is recognised in the accounts depends on the size of the share acquired/sold.

• In the event ownership in the company exists, without this providing a controlling interest, when a controlling interest is obtained in the acquired company a remeasurement is performed at fair value whereby profi t/loss is recognised in profi t or loss for the year. In a corresponding manner a disposal, which results in a loss of control, is recognised as a capital gain or loss from the disposal while the remaining share in the company is remeasured at fair value.
• Acquisitions that take place after control has been obtained or in the event of a disposal when control remains, are regarded as owner transactions, whereby any changes are recognised in equity.

• Contingent considerations will be measured at fair value on the transaction date and in cases where the contingent consideration results in a liability it will be measured at fair value on each accounting date. Remeasurement is recognised as income/ expense in profi t or loss for the year.

• Transaction costs that arise in conjunction with an acquisition are expensed immediately.

• For business combinations there are two alternative methods for recognising goodwill, either full or proportionate share of goodwill. The choice between these two methods is made individually for every acquisition.

Purchase price allocations

Purchase price allocations (PPAs) are preliminary until adopted, which must take place within 12 months from the acquisition. In cases where a PPA is changed, income statements and balance sheets are adjusted for the comparative period when appropriate.

PPAs have been adopted for Biolin Scientifi c, HL Display KVD Kvarndammen and Stofa. A defi nitive PPA for Stofa is reported under Business combinations. PPAs for Biolin Scientifi c, KVD Kvarndammen and HL Display have been adopted in accordance with the preliminary PPAs.

Goodwill and intangible assets

IFRS represents a requirement to identify and measure intangible assets at acquisition. To the extent intangible assets can be identifi ed goodwill decreases correspondingly. Goodwill is not amortised but is subject to an annual test for impairment. Other intangible assets are amortised to the extent that an amortisation period can be determined. In such cases, testing for impairment is only carried out when there is an indication of a decline in value. If the amortisation period cannot be determined and amortisation is therefore not effected, an annual impairment test must be performed regardless of whether or not there is any indication of impairment.

When testing for impairment, goodwill and other intangible assets with an indeterminable useful life are attributable to cash-generating units, which in Ratos's case constitute separate subsidiaries (holdings). All holdings' carrying amounts, including the value of goodwill and intangible non-current assets attributable to the acquisition are tested by calculating the recoverable amount for the holdings. Holdings are tested for impairment annually regardless of whether or not there is any indication of impairment. Testing is conducted between annual periods if there is any indication of impairment.

Business combinations

Acquisitions

In March, Ratos signed an agreement with the Sanoma media group to acquire the Finnish movie theatre group Finnkino. The acquisition was completed on 30 April. The consideration transferred amounted to EUR 71m (SEK 635m). Ratos provided equity of EUR 45m (SEK 402m). In the preliminary PPA goodwill amounts to SEK 537m. Finnkino conducts movie theatre operations in both Finland and the Baltic countries. The goodwill recognised for the acquisition refl ects the company's strong market position, a well-developed concept with movie theatres with many screens, digital and 3D technology as well as service through the sale of snacks, sweets and soft drinks, which have contributed to the company's rising profi tability level.

The acquired company is included in consolidated sales from the acquisition date with SEK 543m and in profi t before tax with SEK 38m. For the full year 2011 sales amounted to SEK 799m and profi t before tax was SEK 21m. The acquisition company's interest expenses are stated pro forma to correspond to a full year. Acquisition-related costs amounted to SEK 26m and are recognised as other operating expenses in consolidated profi t or loss.

Purchase price allocation (PPA)

SEKm	Finnkino
Intangible assets	3
Property plant and equipment	622
Financial assets	1
Current assets	60
Cash and cash equivalents	53
Non-controlling interests	-7
Non-current liabilities and provisions	-474
Current liabilities	-160
Net identifi able assets and liabilities	98
Consolidated goodwill	537
Consideration transferred	635

Since the PPA is preliminary, fair value has not been fi nally identifi ed for all items.

Adoption of purchase price allocations (PPAs) from the previous year

Customer relationships have been measured in the defi nitive PPA for Stofa. Customer relationships are amortised over a 6-month period. As per year-end, customer relationships were therefore fully amortised.

Stofa

SEKm	Preliminary PPA	New measurement	Defi nitive PPA
Intangible assets	6	28	34
Property, plant and equipment	467		467
Financial assets	68		68
Current assets	254		254
Cash and cash equivalents	131		131
Non-controlling interests	-1		-1
Non-current liabilities and provisions	-813		-813
Current liabilities	-329		-329
Net identifi able assets and liabilities	-217	28	-189
Consolidated goodwill	885	-28	857
Consideration transferred	668	0	668

Acquisitions in group companies

Bisnode acquired four Creditinfo Schufa companies in the Czech Republic, Slovakia and Poland which operate within credit and business information solutions. In Norway, Bisnode acquired the credit information company Lindorff Decision and 90.1% of the market information company Lindorff Match. The company also acquired 51% of Vendemore Nordic AB and Poslovna Domena in Croatia. The total consideration transferred for these acquisitions amounted to SEK 402m. The acquired companies are included in consolidated sales from the acquisition date with SEK 106m and in profi t before tax with SEK -10m. For the full year 2011 sales amounted to SEK 209m and profi t before tax was SEK 3m. Acquisition-related costs amounted to SEK 8m for the period and are recognised as other operating expenses in consolidated profi t or loss.

Mobile Climate Control (MCC) acquired Carrier's bus AC operations in North America from the American group Carrier Corporation. Consideration transferred amounted to SEK 217m, whereby Ratos provided capital of SEK 114m. In addition to this a minor acquisition was made. The acquired companies are included in consolidated sales from the acquisition date with SEK 268m and in profi t before tax with SEK 17m. Since the acquisition is an asset deal, no sales or profi t before tax have been calculated for the period prior to the acquisition.

Arcus-Gruppen acquired 51% of the shares in the Norwegian wine wholesaler Excellars AS in August. Consideration transferred amounted to SEK 86m. The acquired company is included in consolidated sales from the acquisition date with SEK 39m and in profi t before tax with SEK 11m. For the full year sales amounted to SEK 111m and profi t before tax was SEK 39m. Acquisition-related costs amounted to SEK 1m and are recognised as other operating expenses in consolidated profi t or loss.

Inwido acquired the Danish window company Pro Tec Vinduer in July. Consideration transferred amounted to SEK 27m.The acquired company is included in consolidated sales from the acquisition date with SEK 106m and in profi t before tax with SEK 5m. For the full year sales amounted to SEK 180m and loss before tax was SEK 14m. Acquisition-related costs amounted to SEK 1m and are recognised as other operating expenses in consolidated profi t or loss.

In August, Biolin Scientifi c acquired all the shares in the Danish company Sophion Bioscience A/S from NeuroSearch A/S as well as a number of venture capital companies. Consideration transferred amounted to DKK 145m (SEK 179m). Ratos provided SEK 65m. In

the preliminary PPA goodwill amounts to SEK 139m. Sophion Bioscience's strong position within Life Science will both provide the company with new technology and increase Biolin Scientifi c's opportunities to reach new customer groups, which motivates the recognised goodwill. Sophion Bioscience is included in consolidated sales from the acquisition date with SEK 51m and in profi t before tax with SEK 19m. For the full year sales amounted to SEK 108m and profi t before tax was SEK 18m. Acquisition-related costs amounted to SEK 2m and are recognised as other operating expenses in consolidated profi t or loss.

In October, Stofa acquired part of Canal Digital's Danish cable TV operations from Telenor. Consideration transferred amounted to DKK 60m corresponding to SEK 73m. The acquired company is included in consolidated sales from the acquisition date with SEK 29m and in profi t before tax with SEK 1m. Acquisitionrelated costs amounted to SEK 5m and are recognised as other operating expenses in consolidated profi t or loss. Since the acquisition is an asset deal, no sales or profi t before tax have been calculated for the period prior to the acquisition.

Preliminary PPAs for each company are provided in the table below.

SEKm	Arcus- Gruppen	Biolin Scientifi c	Bisnode	Inwido	Mobile Climate Control	Stofa
Intangible assets	5	12	43		140	1
Property, plant and equipment	0	4	2	8	7	45
Financial assets		2		0
Deferred tax assets		12	1
Current assets	50	26	31	50	110	26
Cash and cash equivalents	30	0	30	0
Non-controlling interests	-97		-2
Non-current liabilities and provisions	-1	-2	18	-7
Current liabilities	-60	-14	-52	-43	-28	-22
Net identifi able assets and liabilities	-73	39	70	8	231	49
Consolidated goodwill	159	139	332	19		24
Consideration transferred	86	179	402	27	231	73

Purchase price allocations (PPAs)

Since all the PPAs are preliminary, fair value has not been fi nally identifi ed for all items.

Disposals

In November 2010, Ratos concluded an agreement with the principal owners on a sale of the associated company Camfi l to the Larson and Markman families. Consideration transferred amounted to SEK 1,325m and Ratos's capital gain (exit gain) amounted to SEK 586m. The sale was completed in January 2011.

Ratos and co-owner IK Investment Partners concluded an agreement in December 2010 on the sale of all the shares in Superfos Industries A/S. The sale was completed in February and Ratos's share of the consideration transferred amounted to EUR 63m (SEK 549m) and the exit result for Ratos was SEK -99m.

The sale of the subsidiary Medisize to Phillips Plastics was completed on 12 August. Consideration transferred amounted to SEK 866m and Ratos's exit gain amounted to SEK 38m.

Disposal in group company

Euromaint's sale of Euromaint Industry to Coor Service Management was completed in December. Consideration transferred was SEK 100m and the exit loss for Euromaint amounted to SEK 7m.

Share split

At the Annual General Meeting held on 5 April 2011 a decision was made to increase the number of shares in Ratos by each share being divided into two shares (2:1 share split). The share split was effected on 6 May 2011. After the split the number of shares amounted to 324,140,896 instead of 162,070,448, comprising

Disposal after the end of the reporting period

In December, Bisnode concluded an agreement to sell WLW, a company which offers online search services for companies, to the German private equity company Paragon Partners. The selling price is estimated to amount to EUR 79m. The sale is expected to be completed during the fi rst quarter of 2012.

In December, Contex Group concluded an agreement to sell its subsidiaries Z Corporation and Vidar System to the American company 3D Systems Corporation. The sale was completed in January 2012. Consideration transferred amounted to USD 137m and the exit loss was USD 8m which will be recognised in Contex Group.

84,637,060 A shares and 239,503,836 B shares. The completed share split means that the quota value per share (share capital divided by the number of shares) has changed from SEK 6.30 to SEK 3.15. Earnings per share have been recalculated taking the above change into account.

Ratos AB (publ) Drottninggatan 2 Box 1661 SE-111 96 Stockholm Tel +46 8 700 17 00 www.ratos.se Reg. no. 556008-3585