Ratos — Interim / Quarterly Report 2013

Aug 15, 2013

Interim report 2013

• Profit before tax SEK 820m (-16)
• Earnings per share before dilution SEK 2.41 (-0.09)
• Gradual improvement in holdings
• Issue of preference shares
• Acquisition of HENT
• Acquisition of Aibel and Nebula and merger of SF Bio and Finnkino completed in second quarter
• Stofa sold exit gain SEK 895m
• Total return on Ratos shares -13%

Ratos in summary
SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Profit/share of profits	41	72	5	62	-29
Exit gains			895		978
Impairment		-275		-275	-375
Profit/loss from holdings	41	-203	900	-213	574
Central income and expenses	-20	181	-80	197	193
Profit/loss before tax	21	-22	820	-16	767

Important events

Events in the second quarter

• In June, an agreement was signed to acquire Accent Equity's shares in Jøtul, thereby increasing Ratos's ownership from 61% to 93%. The purchase price amounted to NOK 12m (SEK 13m). The acquisition was completed in July
• In June, a directed new issue was made of 830,000 preference shares at SEK 1,750 per preference share with a total value of SEK 1,452.5m. The issue was made to finance the acquisition of Nebula and HENT as well as part of the acquisition of Aibel. The new issue was oversubscribed and approximately 6,000 investors received an allocation. The first day of trading was 28 June
• In May, an agreement was signed to acquire 73% of the shares in the Norwegian construction company HENT from Heimdal Gruppen and a number of financial investors. The enterprise value for 100% of the company amounted to approximately NOK 450m (approximately SEK 510m), of which Ratos provided equity of NOK 307m (SEK 347m). The acquisition was completed in July
• In May, the merger of the cinema groups SF Bio and Finnkino was completed. The new group is owned approximately 58% by Ratos and 40% by Bonnier. The merger did not involve a capital contribution
• In April, the acquisition of Nebula, Finland's leading provider of cloud services to small and medium-sized companies, was completed. The purchase price (enterprise value) for 100% of the company amounted to EUR 82.5m (approximately SEK 700m), of which Ratos provided equity of EUR 34m (SEK 284m) for a holding corresponding to 72%. A possible earn-out payment is contingent on certain profitability milestones being achieved
• The acquisition of Aibel announced in December 2012 was completed in April. Enterprise value for 100% of Aibel amounted to NOK 8,600m. Ratos acquired 32% of the company and provided equity of NOK 1,429m (SEK 1,676m)

■ Capital contributions were provided during the second quarter to AH Industries amounting to SEK 33m and, as previously announced, SEK 39m to Jøtul. In July, a SEK 75m capital contribution was made to Euromaint to finance investments in the business

Events in the first quarter

• In February, the sale was completed of the subsidiary Stofa for DKK 1,900m (approximately SEK 2,200m) (enterprise value). The sale generated a capital gain for Ratos of SEK 895m and an average annual return (IRR) of approximately 54%
• In January, the sale of the remaining subsidiary in Contex Group, Contex A/S, was completed. The selling price (enterprise value) amounted to USD 41.5m (approximately SEK 275m). The winding up of Contex Group has started and Ratos received a payment of SEK 154m in January. An additional amount of approximately SEK 10m is expected when the winding up is completed. Ratos's average annual return (IRR) on the entire investment in Contex Group was -16%
• In January, Arcus-Gruppen completed the acquisition of the brands Aalborg, Brøndums, Gammel Dansk and Malteser. The purchase price (enterprise value) amounted to EUR 103m (approximately SEK 880m) and Ratos provided SEK 77m. As required by the competition authorities, Brøndums was sold in June for EUR 11m (approximately SEK 95m) which generated a capital gain in Arcus-Gruppen of approximately SEK 40m

More information about important events in the holdings is provided on pages 8-14.

		2013 Q 2	2013 Q 1-2
	100%	Ratos's share	100%	Ratos's share
Sales	+2%	-2%	+3%	-2%
EBITA	+9%	+20%	+8%	+12%
EBITA, exclusive items affecting comparability	+6%	+11%	-1%	-1%
EBT	-22%	-3%	-3%	+1%
EBT, exclusive items affecting comparability	-16%	-10%	-19%	-22%

Performance Ratos's holdings *)

To facilitate analysis, an extensive table is provided on page 14 with key figures for Ratos's holdings. A summary of income statements, statements of financial position, etc., for Ratos's associates and subsidiaries is available in downloadable Excel files at www.ratos.se.

Performance during the first half CEO comments

In the second quarter, earnings development improved for Ratos's holdings overall, both in terms of reported and adjusted operating profit (EBITA), with an increasing number of bright spots in the portfolio. Positive market signals strengthened steadily during the period, although the recovery in our business environment and for several of our holdings has been sluggish so far. We therefore expect to see the most obvious effects of the gradual recovery towards the end of 2013 and even more in 2014. Overall, we have therefore not changed our cautiously optimistic view of 2013, a year in which we will also continue to be active in the transaction market and build the foundation for future value creation in Ratos.

Growing stabilisation

Following slightly weaker than expected markets at the beginning of the year, we saw growing stabilisation during the second quarter. Taken overall, conditions remain sluggish but signs of a levelling out can be seen in many areas. Several of our holdings, which have struggled in sharply declining markets, are now sending increasingly positive market signals.

Global macroeconomic signals continue to be increasingly positive, although as expected the strength of the recovery is weak so far and the pace is slow. Economic forecasts for Europe also look slightly brighter. This is important for Ratos given our significant exposure to Western Europe and the Nordic region.

In light of this, our overall view of the trend going forward remains unchanged. We expect a gradual recovery towards the end of the year which will continue and become clearer in 2014. Development remains volatile, however, and since there are clear risks on the downside, we are well prepared for negative surprises.

Gradual improvement in holdings

The second quarter saw improved earnings for Ratos's companies. This was mainly due to extensive measures successfully implemented in many holdings combined with more stable market conditions, and also to the positive impact of more working days after the many public holidays (including Easter) which punished us in the first quarter. The first and second quarters should therefore to some extent be viewed as a whole. It is positive that the majority of Ratos's companies so far this year have improved their operating profit adjusted for items affecting comparability (adjusted EBITA). Ten out of seventeen of the holdings report higher profits compared with the previous year.

Sales for the holdings fell by 2% in the second quarter adjusted for holding size (+2% without adjusting for holding size) and thus far this year the decline in sales is 2% (+3%). Adjusted EBITA increased by +11% (+6%) in the second quarter which, combined with a weaker first quarter, gives a decline of 1% (-1%) so far this year. The second quarter saw a clear recovery in the holdings' earnings.

Items affecting comparability continue to be lower than in the previous year and the expectation is that this trend will continue during 2013. Adjusted EBITA therefore shows a significant increase: +20% in the second quarter adjusted for holding size (+9% without adjusting for holding size) and +12% (+8%) so far this year.

Minority owned Aibel became part of Ratos during the second quarter. This means that performance of the holdings adjusted for holding size provides the clearest picture of Ratos's value creation. Aibel's earnings development thus far has gone according to plan, but is affected when major projects are delivered which means Aibel's performance can vary considerably between quarters and therefore needs to be analysed over a longer period.

There were many bright spots during the second quarter. These included Arcus-Gruppen, with fine growth and earnings development even though the challenges in distribution have not yet been solved; HL Display, which despite relatively weak markets reports a strong earnings trend due to completed action programmes in recent years; MCC, where volumes are weak but clear effects can be seen of the profitability improvement measures implemented; SB Seating, which continues to deliver fine profit increases despite a stagnant market. Even though there are now more bright spots in the Ratos portfolio, we continue to devote a lot of time to the holdings which are still facing tough situations while at the same time having a major focus on encouraging growth initiatives in many holdings.

Additional acquisitions

So far, 2013 has seen a high level of transaction activity for Ratos. During the first quarter we signed agreements to acquire the Finnish company Nebula and on a merger between SF Bio and Ratos-owned Finnkino. These two transactions were completed in the second quarter as was the acquisition of Aibel. An agreement on the acquisition of HENT was concluded in the second quarter and completed in July. We also increased our holding in Jøtul by acquiring the shares held by our co-owner Accent. We see a continued attractive transaction market and remain active.

The macroeconomic unease in the first quarter led to a slowdown in transaction activity before the summer. There is still a pent up need in the private equity sector to sell companies and a macroeconomic stabilisation can contribute to an increased transaction flow.

The banks' interest in financing transactions has increased steadily during the year and there is generally good access to bank financing. Since financing is an important lubricant for the transaction market, this can also lead to an increased deal flow.

Future prospects

The positive market signals we saw in many areas during the first quarter have strengthened in the second quarter. The pace of improvement is slow, however, and we therefore expect to see the clearest impact of the recovery in the figures towards the end of 2013.

As before, our assessment is that gradually improving market conditions, combined with action taken and lower costs affecting comparability, will create conditions for increased profits in Ratos's holdings overall for 2013. Performance between individual quarters will vary, however, and Ratos's earnings should be viewed over a longer period of time.

Susanna Campbell, CEO

Additional CEO comments at www.ratos.se

Ratos's results

Profit before tax for the first half of 2013 amounted to SEK 820m (-16). The higher reported result is mainly due to the exit gain from the sale of Stofa. Earnings include

profit/share of profits from the holdings of SEK 5m (62) and exit gains of SEK 895m (0).

SEKm	2013 Q 1-2	2012 Q 1-2	2012
Profit/share of profits before tax 1)
AH Industries (69%)	-4	-6	-72
Aibel (32%) 2)	76
Anticimex (85%) 3)		51	51
Arcus-Gruppen (83%)	-36	-140	-73
Biolin Scientific (100%)	-5	1	14
Bisnode (70%)	-42	38	-31
Contex Group (100%)		11	-150
DIAB (96%)	-59	-48	-287
Euromaint (100%)	-47	-37	-49
GS-Hydro (100%)	34	39	44
Hafa Bathroom Group (100%)	-3	10	5
HL Display (99%)	54	37	70
Inwido (97%)	44	20	246
Jøtul (61%)	-91	-92	-160
KVD Kvarndammen (100%)	7	19	25
Lindab (11%) 4)		4	4
Mobile Climate Control (100%)	40	37	67
Nebula (72%) 5)	-13
Nordic Cinema Group (58%) 6)	-1	34	82
SB Seating (85%)	50	26	97
Stofa (99%) 7)	1	58	88
Total profit/share of profits	5	62	-29
Exit Anticimex			897
Exit Lindab			81
Exit Stofa	895
Total exit result	895	0	978
Impairment AH Industries		-275	-275
Impairment Jøtul			-100
Profit/loss from holdings	900	-213	574
Central income and expenses
Management costs 8)	-156	62	-54
Financial items	76	135	247
Consolidated profit before tax	820	-16	767

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

2) Aibel is included in consolidated profit from 11 April 2013.

3) Anticimex is included in consolidated profit through June 2012. The entire holding was sold in July 2012.

4) Lindab is included in consolidated profit through June 2012. The entire holding was sold in August 2012.

5) Nebula is included in consolidated profit from May 2013.

6) 2012 relates solely to Finnkino. Earnings for 2013 consist of Finnkino solely until 30 April and subsequently relate to the entire Nordic Cinema Group.

7) Stofa is included in consolidated profit through January 2013. The entire holding was sold in February 2013.

8) Management costs in 2012 include a SEK 168m capital gain which relates to an earlier intra-group sale of a group company where the gain was recognised when this company left the Group in 2012.

Central income and expenses

Ratos's central income and expenses amounted to SEK -80m (197), of which personnel costs in Ratos AB amounted to SEK 84m (60). The variable portion of personnel costs amounted to SEK 34m (10). Other management items amounted to SEK -72m (+122). Management costs in 2012 include a SEK 168m capital gain which relates to an earlier intra-group sale of a group company where the gain was recognised when this company left the Group in 2012. Net financial items amounted to SEK +76m (+135).

Tax

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

Financial position

Cash flow from operating activities and investing activities was SEK -2,375m (491) and consolidated cash and cash equivalents at the end of the period was SEK 2,092m (959), of which short-term interest-bearing investments accounted for SEK 0m (176). Interest-bearing liabilities including pension provisions amounted to SEK 13,565m (12,472).

Parent company

The parent company's loss before tax amounted to SEK 80m (+70). The parent company's cash and cash equivalents, including short-term interest-bearing investments, was SEK 1,043m (1). Taking into account financial transactions agreed but not yet carried out, at 15 August Ratos has a net liquidity of approximately SEK 1 billion. In addition, there is an existing credit facility of SEK 3.2 billion, authorisation from the 2013 AGM to issue 35 million Ratos B shares in conjunction with agreements on acquisitions and an authorisation to issue a maximum of 1,250,000 preference shares in conjunction with agreements on acquisitions, of which 420,000 are unutilized in the existing mandate.

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 Notes 31 and 38 in the 2012 Annual Report. An assessment for the coming months is provided in the CEO comments on performance in the first half section on page 3.

Related-party transactions

The parent company received dividends and repayments of shareholder contributions from subsidiaries and associates of SEK 49m (1,372). Capital contributions have been provided to AH Industries and Jøtul totalling SEK 72m.

Ratos shares

Earnings per share before dilution amounted to SEK 2.41 (-0.09). The total return on Ratos B shares in the first half of 2013 amounted to -13%, compared with the performance of the SIX Return Index which was +9%.

Treasury shares and number of shares

No shares were repurchased and no call options were exercised in the first half of 2013. 4,660 shares were transferred to administrative employees in accordance with an AGM resolution. At the end of June, Ratos owned 5,134,887 B shares (corresponding to 1.6% of the total number of shares), repurchased at an average price of SEK 69.

A directed new issue of 830,000 preference shares was made in June with a total value of SEK 1,452.5m. As a result of the issue, Ratos's share capital increased by SEK 2.6m and subsequently amounts to approximately SEK 1,024m. The first trading day was 28 June.

At 30 June the total number of shares in Ratos (A and B shares as well as preference shares) amounted to 324,970,896 and the number of votes was 108,670,443.6. The number of outstanding A and B shares was 319,006,019 and outstanding preference shares 830,000. The average number of B treasury shares in Ratos in the first half of 2013 was 5,136,534 (5,140,203 in the full year 2012).

Total return

Ratos's equity 1)

At 30 June 2013 Ratos's equity (attributable to owners of the parent) amounted to SEK 13,734m (SEK 12,910m at 31 March 2013), corresponding to SEK 38 per outstanding share (SEK 40 at 31 March 2013).

SEKm	30 June 2013	% of equity
AH Industries	342	3
Aibel	1,621	12
Arcus-Gruppen	454	3
Biolin Scientific	343	3
Bisnode	1,192	9
DIAB	846	6
Euromaint	572	4
GS-Hydro	14	0
Hafa Bathroom Group	152	1
HL Display	1,081	8
Inwido	2,313	17
Jøtul	168	1
KVD Kvarndammen	259	2
Mobile Climate Control	837	6
Nebula	287	2
Nordic Cinema Group	608	4
SB Seating	1,139	8
Total	12,228	89
Other net assets in central companies	1,506	11
Equity (attributable to owners of the parent)	13,734	100
Equity per share, SEK 2)	38

1) Holdings are shown at consolidated figures, which correspond to the Group's share of the holdings' equity, any residual values on consolidated surplus and deficit values minus any intra-group profits. Shareholder loans and capitalised interest on such loans are also included.

2) Equity attributable to owners of the parent with a deduction for total preference capital divided by the number of outstanding ordinary shares at the end of the period. Preference capital per preference share amounted to SEK 1,837.50, which corresponds to the redemption amount after the 2017 Annual General Meeting.

Credit facilities

The parent company has a five-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 financing is required for acquisitions and to be able to finance 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.

Other

Ratos held an Extraordinary General Meeting on 25 April in order, according to "the Leo rules", to obtain approval to transfer all the shares in the subsidiary BTJ Group AB to Per Samuelson, Chairman of the Board of BTJ Group. The purchase price for all the shares amounted to SEK 1. Taking the company's net debt into account, the purchase price corresponds to an enterprise value of approximately SEK 43m. The Meeting resolved to approve the transfer which was completed in May. The sale did not have any earnings impact on Ratos.

Holdings

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

AH Industries

• Sales SEK 513m (631) and EBITA SEK 10m (10)
• Positive development within Industrial Solutions while Wind Solutions was weighed down by weak development within some sections
• Capital contribution of SEK 33m provided
• Knud Andersen new CEO from 15 May 2013
• Focus on cost-cutting programmes due to continued uncertain market prospects for the wind energy industry in the short term

AH Industries is a world-leading supplier of metal components, modules and systems to the wind energy and cement and minerals industries. The company is specialised in the manufacture and machining of heavy metal components with high precision requirements. The company has production facilities in Denmark, China and Germany.

Ratos's holding in AH Industries amounted to 69% and the consolidated book value in Ratos was SEK 342m at 30 June 2013.

Aibel

• Sales SEK 7,509m (6,183) and EBITA SEK 378m (407)
• Good growth in MMO and Modification. Strong sales within Field Development, primarily through final delivery of older contracts with lower margins. Sales and earnings can vary substantially between individual quarters depending on where the projects are in the project cycle
• Final delivery of the three-year Gudrun project to Statoil in July
• Order book at 30 June amounts to approximately NOK 16 billion plus options of an additional NOK 19 billion

Aibel is a leading Norwegian supplier of maintenance and modification services for oil and gas production platforms as well as new construction projects within oil, gas and renewable energy. The company has operations along the entire Norwegian coast as well as in Asia. Customers are primarily major oil companies which operate on the Norwegian continental shelf.

Ratos's holding in Aibel amounted to 32% and the consolidated book value in Ratos was SEK 1,621m at 30 June 2013.

Arcus-Gruppen

• Sales SEK 1,137m (1,028) and EBITA SEK 56m (-101)
• Organic growth +4%. Good sales and earnings growth within spirits following the acquisition of Aalborg with several brands
• Adjusted EBITA amounted to SEK 39m (22). Earnings were charged with costs for ongoing restructuring of the distribution operations as well as integration of acquired brands
• Acquisition of the brands Aalborg, Brøndums, Gammel Dansk and Malteser was completed in January 2013. Brøndums was sold, as required by the competition authorities, in June for EUR 11m (approximately SEK 95m) which generated a capital gain of approximately SEK 40m

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 Aalborg Akvavit, Braastad Cognac, Gammel Dansk, Lysholm Linie Aquavit and Vikingfjord Vodka.

Ratos's holding in Arcus-Gruppen amounted to 83% and the consolidated book value in Ratos was SEK 454m at 30 June 2013.

Biolin Scientific

• Sales SEK 104m (108) and EBITA SEK 1m (5)
• 3% sales growth in local currency
• EBITA adjusted for costs affecting comparability amounted to SEK 4m (5)
• Good development for Diagnostic Instruments (Osstell). Weaker development for Discovery Instruments (Sophion) and Analytical Instruments, partly due to postponed customer orders
• Johan von Heijne new CEO from 1 February 2013

Biolin Scientific 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.

Ratos's holding in Biolin Scientific amounted to 100% and the consolidated book value in Ratos was SEK 343m at 30 June 2013.

Bisnode

• Sales SEK 1,855m (1,922) and EBITA SEK 121m (138) (pro forma 2012, adjusted for Product Information business area)
• Organic sales development adjusted for currency effects was -1%. The decline in sales is due to an overall weak market as well as the effects of an internal change programme during the first quarter
• Growth in Credit Solutions while development in Marketing Solutions and Business Information was weaker
• EBITA adjusted for items affecting comparability amounted to SEK 172m (158), corresponding to an operating margin of 9.3% (8.2)
• Efforts to create a more cohesive Bisnode are underway. The marketing companies throughout the group have been placed under the Bisnode brand

Bisnode is a leading European provider of decision support within business, credit and market information. The customer base is companies and organisations throughout Europe which use Bisnode's services to convert data into knowledge for both day-today issues and major strategic decisions. Bisnode has more than 3,000 employees in 19 countries.

Ratos's holding in Bisnode amounted to 70% and the consolidated book value in Ratos was SEK 1,192m at 30 June 2013.

DIAB

• Sales SEK 424m (540) and EBITA SEK -29m (-19)
• Adjusted for currency effects, sales fell 18% mainly due to a very weak wind energy market in China and the US. Sales to the TIA segment developed well
• Positive news from the Chinese energy authorities and an extension of subsidies in the US, create conditions for an improvement in the wind energy segment during the latter part of 2013
• EBITA adjusted for items affecting comparability on a par with the previous year, SEK -24m (-25), due to completed cost-cutting measures. Initiated cost-cutting programmes proceeding according to plan

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.

Ratos's holding in DIAB amounted to 96% and the consolidated book value in Ratos was SEK 846m at 30 June 2013.

Euromaint

• Sales SEK 1,253m (1,318) and EBITA SEK -6m (14)
• Lower sales due to a weak market and loss of volume from a customer in Germany
• Adjusted for costs affecting comparability related to a lost contract dispute and action programmes, adjusted EBITA amounted to SEK 32m (27)
• Improved earnings development in Sweden. Germany remains weak, action programmes underway
• SEK 75m capital contribution was provided in July to finance investments in the business

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 trackmounted vehicles such as freight carriages, passenger trains, locomotives and work machines. Euromaint has operations in Sweden, Germany, Belgium, the Netherlands and Latvia.

Ratos's holding in Euromaint amounted to 100% and the consolidated book value in Ratos was SEK 572m at 30 June 2013.

GS-Hydro

• Sales SEK 625m (658) and EBITA SEK 50m (65)
• High level of activity and good sales in the offshore segment
• Growth initiatives related to development of the aftermarket offering and business systems charged against earnings
• Lower EBITA margin mainly due to slightly lower sales and growth initiatives

GS-Hydro is a leading supplier of non-welded piping solutions. Products are used in the marine and offshore industries as well as land-based segments such as the pulp and paper, metals and mining, and automotive and aerospace industries. The head office is located in Finland.

Ratos's holding in GS-Hydro amounted to 100% and the consolidated book value in Ratos was SEK 14m at 30 June 2013.

Hafa Bathroom Group

• Sales SEK 122m (142) and EBITA SEK -2m (11)
• Weak consumer market had negative impact on sales
• Lower earnings due to lower volumes and unfavourable sales mix
• Action taken to improve profitability

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

Ratos's holding in Hafa Bathroom Group amounted to 100% and the consolidated book value in Ratos was SEK 152m at 30 June 2013.

HL Display

• Sales SEK 788m (838) and EBITA SEK 65m (55)
• Good sales growth in Northern Europe. Weaker in Southern Europe and Eastern Europe where market uncertainty led to postponed investments in the retail trade and among brand suppliers. Adjusted for currency effects, sales decreased by 2%
• ■ Significant improvement in margins due to good control of costs and efficient production. The EBITA margin increased to 8.6% (7.4)

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

Ratos's holding in HL Display amounted to 99% and the consolidated book value in Ratos was SEK 1,081m at 30 June 2013.

Inwido

• Sales SEK 1,998m (2,132) and EBITA SEK 86m (86) (2012 pro forma for the sale of Home Improvement)
• Organic sales development -4% (adjusted for currency effects)
• Weak order bookings until the middle of the second quarter. Stabilisation towards the end of the period particularly in Sweden and Denmark
• Lower adjusted EBITA margin, 4.4% (5.3) due to lower sales. Cost-cutting measures carried out but did not fully compensate for the decreased sales

Inwido develops, manufactures and sells a full range of windows and exterior 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.

Ratos's holding in Inwido amounted to 97% and the consolidated book value in Ratos was SEK 2,313m at 30 June 2013.

Jøtul

• Sales SEK 346m (364) and EBITA SEK -54m (-71)
• Favourable development in the company's largest markets, Norway and France
• Improved production and delivery efficiency made positive contribution to earnings
• CEO Arve Andresen has decided to resign and will leave his position in August. Recruitment of a successor is underway
• Capital contribution of SEK 39m provided in the second quarter
• In July, Ratos acquired Accent's shares for NOK 12m, and now owns 93% of the shares

The Norwegian company Jøtul is one of Europe's largest manufacturer of stoves and fireplaces 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.

Ratos's holding in Jøtul amounted to 61% and the consolidated book value in Ratos was SEK 168m at 30 June 2013.

KVD Kvarndammen

• Sales SEK 152m (148) and EBITA SEK 14m (23)
• Higher sales despite weak market for company cars and construction machinery
• Rising volumes of cars owned by private individuals
• Establishment costs in Norway explain most (SEK 8m) of the difference in earnings compared with the previous year

KVD Kvarndammen is Sweden's largest independent online marketplace offering broker services for second-hand vehicles. 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.

Ratos's holding in KVD Kvarndammen amounted to 100% and the consolidated book value in Ratos was SEK 259m at 30 June 2013.

Mobile Climate Control (MCC)

• Sales SEK 521m (646) and EBITA SEK 59m (56)
• Adjusted for currency effects, sales fell 16%. Sales were negatively affected by generally weak market conditions in Europe as well as lower volumes in the defence vehicle segment
• Improved operating profit and significant increase in the EBITA margin, 11.3% (8.7), despite lower sales due to completed profitability improvement measures

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

Ratos's holding in Mobile Climate Control amounted to 100% and the consolidated book value in Ratos was SEK 837m at 30 June 2013.

Nebula

• Sales SEK 110m (103) and EBITA SEK 23m (33)
• Very good growth in cloud services and stable development for operating and network services
• Costs of growth initiatives and acquisition costs had a negative impact on operating profit. EBITA adjusted for acquisition costs amounted to SEK 34m (33).

Nebula is a market-leading provider of cloud services, IT infrastructure and network services to small and medium-sized companies in the Finnish market. The company has four data centres, of which two are located in Finland, one in London and one in Singapore, as well as its own leased fibre network between the largest cities in Finland. Nebula has a total of about 34,000 customers. 90% of sales are subscription based.

Ratos's holding in Nebula amounted to 72% and the consolidated book value in Ratos was SEK 287m at 30 June 2013.

Nordic Cinema Group

• Sales SEK 1,121m (1,160) and EBITA SEK 85m (93) (2013 and 2012 pro forma for the merger between SF Bio and Finnkino)
• Adjusted EBITA, adjusted for transaction costs and other items affecting comparability, amounted to SEK 89m (92)
• The number of cinemagoers was 6% lower compared with a record-strong 2012
• Integration of SF Bio and Finnkino underway

Nordic Cinema Group is the Nordic region's largest cinema group with 102 movie theatres with 583 screens and 80,943 seats in six countries – Sweden, Finland, Norway, Estonia, Latvia and Lithuania. Several strong local brands are part of the group: SF Bio, SF Kino, Finnkino and Forum Cinemas. Nordic Cinema Group was established in 2013 through a merger of SF Bio and Finnkino.

Ratos's holding in Nordic Cinema Group amounted to 58% and the consolidated book value in Ratos was SEK 608m at 30 June 2013.

SB Seating

• Sales SEK 564m (580) and EBITA SEK 116m (98)
• Increased sales in Denmark, Finland, France and the UK
• Higher EBITA margin, 21% (17), due to improved operational efficiency
• Acquisition of importer in Switzerland, Europe's sixthlargest office furniture market, for NOK 8m
• Three new products launched in 2013: HÅG SoFi, RH Mereo and RBM Noor. Red Dot Design Award (Best of the Best) received for RBM Noor. HÅG SoFi received the Environmental Award from the Norwegian Design Council

SB Seating develops and produces ergonomic office 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, Switzerland, Singapore, the UK, the Netherlands and France.

Ratos's holding in SB Seating amounted to 85% and the consolidated book value in Ratos was SEK 1,139m at 30 June 2013.

Ratos's holdings at 30 June 2013

			Net sales			EBITA
SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2 2012 Q 1-2		2012	2013 Q 2		2012 Q 2 2013 Q 1-2 2012 Q 1-2		2012
AH Industries	259	345	513	631	1,062	3	1	10	10	-45
Aibel 1)	3,709	3,252	7,509	6,183	12,709	212	242	378	407	892
Arcus-Gruppen	624	542	1,137	1,028	2,278	78	-45	56	-101	5
Biolin Scientific	54	59	104	108	235	3	6	1	5	23
Bisnode 2)	930	939	1,855	1,922	3,869	48	57	121	138	339
DIAB	216	277	424	540	1,003	-24	-16	-29	-19	-217
Euromaint	630	627	1,253	1,318	2,489	8	4	-6	14	51
GS-Hydro	324	338	625	658	1,352	34	40	50	65	123
Hafa Bathroom Group	57	61	122	142	268	-3	1	-2	11	7
HL Display	414	435	788	838	1,657	41	27	65	55	104
Inwido 3)	1,141	1,201	1,998	2,132	4,476	105	113	86	86	328
Jøtul	163	156	346	364	913	-33	-46	-54	-71	-52
KVD Kvarndammen	77	71	152	148	287	8	11	14	23	41
Mobile Climate Control	277	361	521	646	1,250	42	36	59	56	108
Nebula 4)	57	53	110	103	211	6	18	23	33	70
Nordic Cinema Group 5)	489	537	1,121	1,160	2,577	-22	27	85	93	324
SB Seating	273	274	564	580	1,176	54	39	116	98	237
Total 100%	9,694	9,529	19,142	18,502	37,814	560	515	971	903	2,340
Change		2%		3%			9%		8%
Total adjusted for ownership	6,313	6,422	12,277	12,471	25,347	396	331	623	559	1,466
Change		-2%		-2%			20%		12%

		Adjusted EBITA A)				Depre- ciation	Invest- B) ments	CashC) flow	Interest- bearing net debt	Consoli- dated value	Ratos's owner ship
SEKm	2013 Q 2		2012 Q 2 2013 Q 1-2 2012 Q 1-2		2012	2013	2013	2013		30 June 13 30 June 13 30 June 13
AH Industries	3	1	10	10	-7	27	7	-12	382	342	69%
Aibel 1)	216	242	383	407	892	87	–	–	5,076	1,621	32%
Arcus-Gruppen	46	19	39	22	205	27	17	-480	1,598	454	83%
Biolin Scientific	3	6	4	5	23	5	15	2	159	343	100%
Bisnode 2)	93	71	172	158	414	59	32	135	2,014	1,192	70%
DIAB	-19	-22	-24	-25	-75	33	15	-38	782	846	96%
Euromaint	13	5	32	27	81	21	13	-6	575	572	100%
GS-Hydro	34	40	50	65	123	10	8	39	421	14	100%
Hafa Bathroom Group	-3	1	-2	11	7	1	3	-3	64	152	100%
HL Display	40	32	68	62	125	19	20	7	382	1,081	99%
Inwido 3)	105	116	88	113	347	53	36	-87	1,331	2,313	97%
Jøtul	-33	-46	-51	-71	-52	30	20	-134	661	168	61%
KVD Kvarndammen	8	11	14	25	44	1	2	4	216	259	100%
Mobile Climate Control	42	37	59	59	111	8	4	49	524	837	100%
Nebula 4)	17	18	34	33	70	9	–	–	322	287	72%
Nordic Cinema Group 5)	9	27	89	92	329	80	–	–	1,805	608	58%
SB Seating	58	39	119	98	237	16	28	32	615	1,139	85%
Total 100%	633	596	1,085	1,091	2,875
Change		6%		-1%

Change		6%	-1%
Total adjusted for ownership	441	398	714	720	1,925
Change		11%		-1%

A) EBITA, excluding items affecting comparability.

B) Investments excluding business combinations.

C) Cash flow refers to cash flow from operating activities and investing activities before acquisition and disposal of companies.

1) Aibel's earnings for 2013 and 2012 are pro forma taking into account Ratos's acquisition and new financing.

2) Bisnode's earnings for 2012 are pro forma taking into account discontinued operation Product Information.

3) Inwido's earnings for 2012 are pro forma taking into account sale of Home Improvement.

4) Nebula's earnings for 2013 and 2012 are pro forma taking into account Ratos's acquisition and new financing.

5) Nordic Cinema Group's earnings for 2013 and 2012 are pro forma taking into account Ratos's acquisition and new financing.

Financial statements

Consolidated income statement

SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Net sales	5,897	7,302	11,358	14,124	27,100
Other operating income	81	44	166	84	171
Change in inventories	-36	-35	15	31	-32
Raw materials and consumables	-2,194	-2,956	-4,441	-5,661	-10,918
Employee benefit costs	-1,961	-2,306	-3,919	-4,595	-8,644
Depreciation and impairment of property, plant and equipment and intangible assets	-211	-527	-415	-951	-1,942
Other costs	-1,316	-1,488	-2,405	-2,954	-5,391
Capital gain/loss from the sale of group companies	-42	126	864	284	1,179
Capital gain/loss from the sale of associates					81
Share of profits of associates	82	13	86	12	18
Operating profit/loss	300	173	1,309	374	1,622
Financial income	25	37	56	83	154
Financial expenses	-304	-232	-545	-473	-1,009
Net financial items	-279	-195	-489	-390	-855
Profit/loss before tax	21	-22	820	-16	767
Tax	-70	-14	-71	-23	-224
Profit/loss for the period	-49	-36	749	-39	543
Profit/loss for the period attributable to:
Owners of the parent	-18	-28	789	-29	606
Non-controlling interests	-31	-8	-40	-10	-63
Earnings per share, SEK
– before dilution	-0.12	-0.09	2.41	-0.09	1.90
– after dilution	-0.12	-0.09	2.41	-0.09	1.90

Consolidated statement of comprehensive income

SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Profit/loss for the period	-49	-36	749	-39	543
Other comprehensive income
Items that will not be reclassified to profit or loss:
Remeasurement of definite benefit pension obligations, net					-33
Tax attributable to items that will not be reclassified to profit or loss					12
					-21
Items that may be reclassified subsequently to profit or loss:
Translation differences for the period	327	-5	47	-53	-157
Change in hedging reserve for the period	9	-18	24	6	40
Tax attributable to items that may be reclassified subsequently to profit or loss	-2	5	-6	-1	-11
Other comprehensive income for the period	334	-18	65	-48	-128
Total comprehensive income for the period	285	-54	814	-87	394
Total comprehensive income for the period attributable to:
Owners of the parent	258	-35	832	-69	483
Non-controlling interests	27	-19	-18	-18	-89

Summary consolidated statement of financial position

SEKm	30 June 2013	30 June 2012	31 Dec 2012
ASSETS
Non-current assets
Goodwill	18,112	16,898	15,502
Other intangible assets	1,736	1,360	1,292
Property, plant and equipment	3,828	3,973	3,461
Financial assets	2,978	613	225
Deferred tax assets	574	651	557
Total non-current assets	27,228	23,495	21,037
Current assets
Inventories	2,504	2,739	2,387
Current receivables	5,631	5,887	4,906
Cash and cash equivalents	2,092	959	3,203
Assets held for sale		3,157	2,054
Total current assets	10,227	12,742	12,550
Total assets	37,455	36,237	33,587
EQUITY AND LIABILITIES
Equity including non-controlling interests	15,912	12,758	13,141
Non-current liabilities
Interest-bearing liabilities	10,365	9,753	7,937
Non-interest bearing liabilities	712	725	760
Pension provisions	436	318	370
Other provisions	152	226	179
Deferred tax liabilities	549	460	396
Total non-current liabilities	12,214	11,482	9,642
Current liabilities
Interest-bearing liabilities	2,764	2,401	2,489
Non-interest bearing liabilities	6,353	7,007	6,413
Provisions	212	98	138
Liabilities attributable to assets held for sale		2,491	1,764
Total current liabilities	9,329	11,997	10,804
Total equity and liabilities	37,455	36,237	33,587

Summary statement of changes in consolidated equity

	30 June 2013				30 June 2012		31 Dec 2012
SEKm	Owners of the parent	Non controlling interest	Total equity	Owners of the parent	Non controlling interest	Total equity	Owners of the parent	Non controlling interest	Total equity
Opening equity	12,353	788	13,141	13,658	997	14,655	13,658	997	14,655
Changed accounting principle				-36	-9	-45	-36	-9	-45
Adjusted equity	12,353	788	13,141	13,622	988	14,610	13,622	988	14,610
Total comprehensive
income for the period	832	-18	814	-69	-18	-87	483	-89	394
Dividend	-1,019	-35	-1,054	-1,754	-73	-1,827	-1,754	-75	-1,829
New issue	1,451	4	1,455		14	14		17	17
Sale of treasury shares in associates				6		6	6		6
Option premiums							5		5
Acquisition of shares in subsidiaries from non-con trolling interests	-18	-5	-23	-4	-11	-15	-9	-7	-16
Sale of shares in subsidiaries to non-controlling interests	135		135
Non-controlling interests at acquisition		1,463	1,463		12	12		1	1
Non-controlling interests in disposals		-19	-19					-47	-47
Closing equity	13,734	2,178	15,912	11,801	912	12,713	12,353	788	13,141

Consolidated statement of cash flows

SEKm	2013 Q 1-2	2012 Q 1-2	2012
Operating activities
Profit before tax	820	-16	767
Adjustment for non-cash items	-514	618	927
	306	602	1,694
Income tax paid	-172	-142	-260
Cash flow from operating activities before change in working capital	134	460	1,434
Cash flow from change in working capital
Increase (-)/Decrease (+) in inventories	-31	-146	120
Increase (-)/Decrease (+) in operating receivables	-616	-210	416
Increase (+)/Decrease (-) in operating liabilities	-414	-734	-861
Cash flow from operating activities	-927	-630	1,109
Investing activities
Acquisition, group companies	-920	-15	-53
Disposal, group companies	1,345	1,543	2,915
Acquisition, shares in associates	-1,676		-2
Disposal, shares in associates			386
Acquisition, other intangible/tangible assets	-297	-414	-898
Disposal, other intangible/tangible assets	120	13	65
Investment, financial assets	-79	-24	-37
Disposal, financial assets	59	18	35
Cash flow from investing activities	-1,448	1,121	2,411
Financing activities
New issue	1,451
Non-controlling interests' share of issue/capital contribution	4
Redemption of options	-88		-13
Option premiums	2		17
Acquisition of shares in subsidiaries from non-controlling interests	-19	-15	-21
Dividend paid	-957	-1,754	-1,754
Dividend paid/redemption, non-controlling interests	-35	-73	-75
Borrowings	1,991	847	1,596
Amortisation of loans	-1,144	-1,374	-3,025
Cash flow from financing activities	1,205	-2,369	-3,275
Cash flow for the period	-1,170	-1,878	245
Cash and cash equivalents at beginning of the year	3,203	3,042	3,042
Exchange differences in cash and cash equivalents	-13	-2	-10
Cash and cash equivalents attributable to assets held for share	72	-203	-74
Cash and cash equivalents at the end of the period	2,092	959	3,203

Consolidated key figures

SEKm	2013 Q 1-2	2012 Q 1-2	2012
Return on equity, %			5
Equity ratio, %	43	35	39
Key figures per share
Total return, %	-13	-13	-17
Dividend yield, %			4.8
Market price, SEK	52.05	65.50	62.50
Dividend, SEK			3
Equity attributable to owners of the parent, SEK 1)	38	37	39
Earnings per share before dilution, SEK	2.41	-0.09	1.90
Average number of shares outstanding
– before dilution	319,004,362	319,000,015	319,000,693
– after dilution	319,004,362	319,000,015	319,008,267
Total number of registered shares	324,970,896	324,140,896	324,140,896
Number of shares outstanding	319,836,019	319,001,359	319,001,359
– of which A shares	84,637,060	84,637,060	84,637,060
– of which B shares	234,368,959	234,364,299	234,364,299
– of which preference shares	830,000

1) Equity attributable to owners of the parent with a deduction for total preference capital divided by the number of outstanding ordinary shares at the end of the period. Preference capital per preference share amounted to SEK 1,837.50, which corresponds to the redemption amount after the 2017 Annual General Meeting.

Parent company income statement

SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Other operating income	11		11	1	2
Other external costs	-25	-27	-45	-44	-82
Personnel costs	-35	-27	-83	-60	-119
Depreciation of property, plant and equipment	-1	-1	-2	-2	-5
Operating profit/loss	-50	-55	-119	-105	-204
Capital gain from sale of investments in group companies					830
Dividends from group companies		382	49	382	382
Impairment of shares in group companies		-301		-301	-796
Capital gain from sale of interests in associates					266
Dividends from associates		9		14	14
Impairment of interests in associates					-5
Result from other securities and receivables accounted for as non-current assets	31	45	66	86	137
Other interest income and similar profit/loss items	4	3	11	20	33
Interest expenses and similar profit/loss items	-10	-11	-87	-26	-51
Profit/loss after financial items	-25	72	-80	70	606
Tax
Profit/loss for the period	-25	72	-80	70	606

Parent company statement of comprehensive income

SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Profit/loss for the period	-25	72	-80	70	606
Other comprehensive income
Change in fair value reserve for the period	84	0	14	1	-13
Other comprehensive income for the period	84	0	14	1	-13
Comprehensive income for the period	59	72	-66	71	593

Summary parent company balance sheet

SEKm	30 June 2013	30 June 2012	31 Dec 2012
ASSETS
Non-current assets
Property, plant and equipment	76	81	78
Financial assets	12,525	11,334	10,235
Total non-current assets	12,601	11,415	10,313
Current assets
Current receivables	205	87	20
Short-term investments			499
Cash and cash equivalents	1,043	1	1,324
Total current assets	1,248	88	1,843
Total assets	13,849	11,503	12,156
EQUITY AND LIABILITIES
Equity	11,751	10,858	11,385
Non-current provisions
Pension provisions	1	1	1
Other provisions	7	16	7
Non-current liabilities
Interest-bearing liabilities, group companies	510	439	442
Non-interest bearing liabilities	41	24	29
Current provisions	9	18	28
Current liabilities
Interest-bearing liabilities		72
Interest-bearing liabilities, group companies	1,347		174
Non-interest bearing liabilities	183	75	90
Total equity and liabilities	13,849	11,503	12,156
Pledged assets and contingent liabilities	none	none	none

Summary statement of changes in parent company's equity

SEKm	30 June 2013	30 June 2012	31 Dec 2012
Opening equity	11,385	12,541	12,541
Total comprehensive income for the period	-66	71	593
Dividend	-1,019	-1,754	-1,754
New issue	1,451
Option premiums			5
Closing equity	11,751	10,858	11,385

Parent company cash flow statement

SEKm	2013 Q 1-2	2012 Q 1-2	2012
Operating activities
Profit before tax	-80	70	606
Adjustment for non-cash items	24	-68	-700
	-56	2	-94
Income tax paid	–	–	–
Cash flow from operating activities before change in working capital	-56	2	-94
Cash flow from change in working capital
Increase(-)/Decrease (+) in operating receivables	-106	-34	-23
Increase (+)/Decrease (-) in operating liabilities	-6	-24	-21
Cash flow from operating activities	-168	-56	-138
Investing activities
Investment, shares in subsidiaries	-2,500	-375	-381
Disposal and redemption, shares in subsidiaries	124	1,047	2,740
Disposal, shares in associates and other holdings			385
Acquisition, property, plant and equipment		-1	-1
Investment, financial assets	-174	-40	-145
Disposal, financial assets	20	90	103
Cash flow from investing activities	-2,530	721	2,701
Financing activities
New issue	1,451
Option premiums	1		5
Redemption incentive programme	-20		-5
Dividend paid	-957	-1,754	-1,754
Credit facility utilised		72
Loans raised in group companies	1,443	121	117
Cash flow from financing activities	1,918	-1,561	-1,637
Cash flow for the period	-780	-896	926
Cash and cash equivalents at the beginning of the year	1,823	897	897
Cash and cash equivalents at the end of the period	1,043	1	1,823

Note 1 Accounting principles in accordance with IFRS

The consolidated financial 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.

IFRS requires uniform accounting principles within a group. 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, with the exception of the introduction of amended IAS 19, Employee Benefits.

Preference shares

Ratos issued preference shares in 2013. Ratos classifies these as equity in accordance with IAS 32, since Ratos does not have an undertaking to redeem outstanding preference shares. Ratos's Board of Directors is able to make decisions on redemption of preference shares. Dividends to preference shareholders require a general meeting resolution.

New accounting principles for 2013

The revised IFRS standards which come into force in 2013 are not assessed overall as having any material effect on the performance, financial position or disclosures of the Group or parent company.

IAS 19 – Employee Benefits

New IAS 19 represents changes relating to recognition of defined benefit pension plans. The amendments mean that the present value of the defined benefit obligations are in their entirety booked in the statement of financial position since the possibility to defer actuarial gains and losses over time as part of the so-called corridor rule may no longer be applied. Going forward these are to be reported in other comprehensive income. The net pension liability will in future be calculated on the basis of the discount rate for pension provisions. Previously the anticipated return on plan assets and the discount rate were used to calculate the interest expense related to pension obligations.

Note 2 Business combinations

Acquisitions

In March, Ratos signed an agreement with Bonnier on a merger of SF Bio and Finnkino. The merger takes place through a newly formed company, Nordic Cinema Group, acquiring all the shares in SF Bio and Finnkino. In conjunction with completion of the merger at the beginning of May, Ratos transferred its shares in the holding in Finnkino to the new group which is now owned to approximately 58% by Ratos and 40% by Bonnier. Interestbearing net debt in Nordic Cinema Group amounted to SEK 1,805m at 30 June. Ratos has prepared a preliminary purchase price allocation for SF Bio since the final figures for the transaction have not been fixed. The entire difference between consideration transferred and carrying amounts of assets and liabilities has been allocated to goodwill of approximately SEK 1,900m. The goodwill recognised for SF Bio mainly reflects the company's growth, profitability, market position and stability. SF Bio is included in consolidated sales for the period with SEK 200m and in operating profit (EBITA) with SEK -6m. For the period January to June pro forma sales amounted to SEK 751m and EBITA to SEK 25m. The acquisition company's interest expenses have been stated pro forma to correspond to the entire

The net amount affects equity as a change in accounting principles as per 1 January 2012. Subsequently actuarial gains and losses are recognised in other comprehensive income. The total effect on the Ratos Group's equity amounts to SEK -66m after tax, which is divided among adjustment of opening balance of SEK -45m after tax and SEK -21m after tax in other comprehensive income in 2012. The difference from the previously stated amount, SEK -114m, is mainly due to effects of sold companies and a transfer to defined contribution pension plans.

IAS 1 – Presentation of Financial Statements

The consolidated statement of comprehensive income have been divided into items that in future can, or cannot, be reclassified to profit or loss. The statement also includes, following introduction of amended IAS 19, a separate line for remeasurement of defined benefit pensions.

IFRS 13 – Fair Value Measurement

This standard defines fair value when another IFRS requires fair value measurements. It also provides guidance on valuation techniques and a requirement for more detailed disclosures. The introduction of this standard is not expected to have a significant effect on Ratos's fair value calculation where these are used in the financial statements or where disclosures on fair value are to be made. For disclosures on financial instruments which must be provided quarterly from 2013, see Note 4.

IAS 34 – Interim Financial Reporting

The amendment entails a requirement for disclosures according to changed standards as set out above as well as disclosures on financial instruments according to IFRS 7 which were previously provided annually, see Note 4.

IFRS 7 – Financial Instruments: Disclosures

The amendment relates to disclosure requirements relating to offsetting of financial assets and liabilities as well as potential netting effects in the event of binding master agreements.

period. Acquisition-related costs amounted to approximately SEK 30m in the reporting period and are recognised as other operating expenses in consolidated profit for the period.

In March, Ratos, together with Rite Ventures and the company's management, signed an agreement to acquire Nebula Oy, a market-leading provider of cloud services, IT infrastructure and network services to small and medium-sized companies in the Finnish market. The acquisition was completed in April. The purchase price (enterprise value) for 100% of the company amounted to EUR 82.5m (approximately SEK 700m), of which Ratos provided equity of EUR 34m (SEK 284m) for a holding corresponding to 72%. A contingent consideration in a maximum amount of EUR 10m may be paid in 2013 and an additional maximum amount of EUR 10m in 2014 if certain profitability milestones are achieved. In the preliminary purchase price allocation, goodwill amounts to SEK 627m, which is motivated by the company's strong market position, strong cash flows and good customer relationships. The acquired company is included in consolidated sales for the period with SEK 38m and in profit before tax with SEK -13m. For the period January to June pro forma sales amounted

to SEK 110m and profit before tax to SEK 8m. The acquisition company's interest expenses have been stated pro forma to correspond to the entire period. Acquisition-related costs amounted to approximately SEK 12m for the period and are recognised as other operating expenses in consolidated profit for the period.

Preliminary purchase price allocation

SEKm	Nebula
Intangible assets	93
Property, plant and equipment	50
Current assets	16
Cash and cash equivalents	26
Non-controlling interests	-108
Non-current liabilities and provisions	-311
Deferred tax liability	-26
Current liabilities	-83
Net identifiable assets and liabilities	-343
Consolidated goodwill	627
Consideration transferred	284

The purchase price allocation is preliminary, which means that fair value is not finally identified for all items.

In acquisitions made so far in 2013 no goodwill attributable to non-controlling interests has been recognised.

Acquisition of associate

The acquisition of Aibel announced in December 2012 was completed in April. Enterprise value for 100% of Aibel amounted to NOK 8,600m. Ratos and the Sixth AP Fund acquired Aibel via a jointly owned company. Ratos provided equity of NOK 1,429m (SEK 1,676m) in the jointly owned company. Via the jointly owned company, Ratos owns 32% of Aibel. Ratos reports this participation as an associate. In the preliminary purchase price allocation the difference between consideration transferred and carrying amounts of assets and liabilities is allocated to goodwill.

Acquisition after the end of the reporting period

In May, an agreement was signed to acquire 73% of the shares in the Norwegian construction company HENT from Heimdal Gruppen and a number of financial investors. Enterprise value for 100% of the company amounted to approximately NOK 450m (approximately SEK 510m), of

which Ratos provided equity of NOK 307m (SEK 347m). The acquisition was completed in July. Since the acquisition was completed after the end of the reporting period, a preliminary purchase price allocation could not be prepared.

Acquisitions in subsidiaries

In July 2012, Arcus-Gruppen signed an agreement to acquire the brands Aalborg, Brøndums, Gammel Dansk and Malteser from Pernod Ricard. The purchase price (enterprise value) amounted to EUR 103m (approximately SEK 880m). The acquisition was completed in January 2013. In the preliminary purchase price allocation trademarks amount to SEK 447m and goodwill to SEK 361m. Brøndums was sold in June 2013. The purchase price (enterprise value) amounted to EUR 11m (approximately SEK 95m) and generated a capital gain in Arcus-Gruppen of approximately SEK 40m.

SEKm	Arcus
Intangible assets	447
Property, plant and equipment	121
Current assets	42
Cash and cash equivalents	130
Deferred tax liability	-122
Current liabilities	-53
Net identifiable assets and liabilities	565
Consolidated goodwill	361
Consideration transferred	926

Disposals

In October 2012, Ratos signed an agreement on the sale of all the shares in the subsidiary Stofa to the Danish energy and telecom group SE (Syd Energi). The sale was completed in February 2013. Consideration transferred amounted to SEK 1,204m and the capital gain for Ratos (exit gain) amounted to SEK 895m.

Disposals in subsidiaries

Ratos's subsidiary Contex Group sold its subsidiary Contex A/S to the private equity fund Procuritas. The sale was completed in January 2013. Consideration transferred amounted to SEK 219m and the capital gain for Contex Group amounted to SEK 0m.

Note 3 Operating segments

			Sales					EBT 1)
SEKm	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012	2013 Q 2	2012 Q 2	2013 Q 1-2	2012 Q 1-2	2012
Holdings
AH Industries	259	344	513	631	1,062	-5	-7	-4	-6	-72
Aibel 2)						76		76
Anticimex 3)		523		1,009	1,009		38		51	51
Arcus-Gruppen	625	542	1,137	1,028	2,278	43	-58	-36	-140	-73
Biolin Scientific	54	59	104	108	235	-4	3	-5	1	14
Bisnode	930	967	1,855	2,000	3,935	-65	12	-42	38	-31
Contex Group		90		175	286		11		11	-150
DIAB	216	277	424	540	1,003	-36	-29	-59	-48	-287
Euromaint	630	627	1,253	1,318	2,489	-5	-19	-47	-37	-49
GS-Hydro	324	338	625	658	1,352	26	27	34	39	44
Hafa Bathroom Group	58	61	122	142	268	-3	1	-3	10	5
HL Display	414	435	788	838	1,657	38	18	54	37	70
Inwido	1,141	1,258	1,998	2,263	4,607	80	50	44	20	246
Jøtul	163	156	346	364	913	-55	-56	-91	-92	-160
KVD Kvarndammen	78	70	152	148	287	4	9	7	19	25
Lindab 4)							9		4	4
Mobile Climate Control	277	360	521	646	1,250	34	24	40	37	67
Nebula 5)	37		37			-13		-13
Nordic Cinema Group 6)	366	197	591	422	862	-85	11	-1	34	82
SB Seating	273	274	564	580	1,176	14	2	50	26	97
Stofa 7)		393	131	786	1,572		26	1	58	88
Total	5,843	6,971	11,161	13,656	26,241	44	72	5	62	-29
Exit Anticimex										897
Exit Lindab										81
Exit Stofa						-3		895
Exit result						-3	0	895	0	978
Impairment AH Industries							-275		-275	-275
Impairment Jøtul										-100
Holdings total	5,843	6,971	11,161	13,656	26,241	41	-203	900	-213	574
Central income and expenses 8)	54	331	197	468	859	-20	181	-80	197	193
Group total	5,897	7,302	11,358	14,124	27,100	21	-22	820	-16	767

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

2) Aibel is included in consolidated profit from 11 April 2013.

3) Anticimex is included in consolidated profit through June 2012. The entire holding was sold in July 2012.

4) Lindab is included in consolidated profit through June 2012. The entire holding was sold in August 2012.

5) Nebula is included in consolidated profit from May 2013.

6) 2012 relates solely to Finnkino. Earnings for 2013 consist of Finnkino solely until 30 April and subsequently relate to the entire Nordic Cinema Group.

7) Stofa is included in consolidated profit through January 2013. The entire holding was sold in February 2013.

8) Management costs in 2012 include a SEK 168m capital gain which relates to an earlier intra-group sale of a group company where the gain was recognised when this company left the Group in 2012.

Valuation techniques are unchanged during the period.

Ratos applies fair value measurements to a limited extent and mainly for derivatives and synthetic options. These items are measured according to levels two and three respectively in the fair value hierarchy.

In the statement of financial position at 30 June the net value of derivatives amounts to SEK 56m, SEK 8m recognised as an asset and SEK 64m as a liability. In addition, a SEK 131m liability is recognised for synthetic options. Earnings for the period have been charged with SEK 24m for derivatives and SEK 13m for synthetic option programmes. Ratos's assessment is that the carrying amounts of both trade receivables and trade payables comprise the fair values on the balance sheet date, as is the case with consolidated cash and cash equivalents.

Ratos measures its interest-bearing liabilities at amortised cost according to the effective interest method. Ratos's assessment is that this value, among other things depending on loan terms, corresponds to fair value on the balance sheet date.

This six-month report provides a true and fair overview of the parent company's and the Group's operations, their financial position and performance, and describes material risks and uncertainties facing the parent company and other companies in the Group.

Stockholm, 15 August 2013 Ratos AB (publ)

Arne Karlsson Chairman

Lars Berg Staffan Bohman Annette Sadolin Board Member Board Member Board Member

Jan Söderberg Per-Olof Söderberg Margareth Øvrum Board Member Board Member Board Member

Susanna Campbell CEO

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

Telephone conference

15 August 10.00 CET +46 8-505 201 10. Code: Ratos

CEO's comments

Listen to CEO Susanna Campbell's comments on the interim report at www.ratos.se

Financial calendar
2013
8 Nov	Interim report January-September
2014
20 Feb	Year-end report 2013
27 March	AGM
8 May	Interim report January-March
15 Aug	Interim report January-June
7 Nov	Interim report January-September

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

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

Drottninggatan 2 Box 1661 SE-111 96 Stockholm Tel +46 8 700 17 00 Fax +46 8 10 25 59 www.ratos.se Reg. no. 556008-3585

Ratos is a private equity conglomerate. The company's mission is to maximise shareholder value over time through the professional, active and responsible exercise of its ownership role in primarily medium to large unlisted Nordic companies. Ratos's holdings include AH Industries, Aibel, Arcus-Gruppen, Biolin Scientific, Bisnode, DIAB, Euromaint, GS-Hydro, Hafa Bathroom Group, HENT, HL Display, Inwido, Jøtul, KVD Kvarndammen, Mobile Climate Control, Nebula, Nordic Cinema Group and SB Seating. Ratos is listed on Nasdaq OMX Stockholm and market capitalisation amounts to approximately SEK 19 billion.