Scandi Standard

Earnings Release • Feb 25, 2015

Fourth quarter and year-end report 2014

25 February 2015

Fourth quarter compared to the same period 2013

• Net sales decreased by 4 percent to 1,252.0 (1,306.8) MSEK, and by 6 percent at constant FX, with a decline in Norway and higher sales from Sweden and Denmark.
• Adjusted*operating income increased to 79.6 (77.0) MSEK, corresponding to an improved margin of 6.4 (5.9) percent.
• Adjusted* income for the period increased to 48.1 (16.5) MSEK, and adjusted* earnings per share were 0.80 (0.33) SEK.
• Adjusted* operating cash flow improved to 64.5 (-53.2) MSEK.

Full year 2014 compared to pro forma 2013

• Net sales increased by 1 percent to 5,267.2 (5,192.4) MSEK, and were flat at constant FX, with strong growth in Sweden and higher sales in Denmark offsetting lower sales in Norway.
• Adjusted* operating income decreased to 301.0 (317.2) MSEK corresponding to a margin of 5.7 (6.1) percent, due to the termination of a major contract in Norway as of 1 April 2014.
• Adjusted* income for the period increased to 145.1 (89.2) MSEK and adjusted*earnings per share rose to 2.63 (1.78) SEK, positively impacted by lower finance expenses following the refinancing of bank loans in July 2014.
• Adjusted* operating cash flow improved to 438.1 (176.1) MSEK, helped by a reduction of inventories compared to an increase in the previous year.

MSEK	Q4 2014	Q4 2013	Change	2014	Pro forma 2013	Change
Net sales	1,252.0	1,306.8	-4%	5,267.2	5,192.4	1%
Operating income	73.5	57.2	29%	238.5	162.9	46%
Income for the period	42.9	2.9	n.a	56.1	-30.0	n.a
Adjusted* EBITDA	118.8	117.0	2%	470.2	479.0	-2%
Adjusted* operating income	79.6	77.0	3%	301.0	317.2	-5%
Adjusted* operating margin	6.4%	5.9%	-	5.7%	6.1%	-
Adjusted* income for the period	48.1	16.5	192%	145.1	89.2	63%
Adjusted* EPS, SEK	0.80	0.33	143%	2.63	1.78	48%
Adjusted* operating cash flow	64.5	-53.2	n.a	438.1	176.1	149%

The Board of Directors proposes a dividend for 2014 of 1.30 (-) SEK per share.

*) Adjusted for non-comparable items of -6.1 (-19.8) MSEK in operating income in Q4 and -62.5 (-154.3) MSEK for the full year 2014. For further details on the non-comparable items, see page 4.

Scandi Standard is the largest producer of chicken in the Nordic region with leading positions in Sweden, Denmark and Norway. The company produces, markets and sells chilled and frozen chicken-based food products under the brands Kronfågel, Danpo, Den Stolte Hane, Vestfold Fugl, Ivars and Chicky World. In Norway eggs are also packed and sold under the brand Den Stolte Hane. For more information, see www.scandistandard.com

CEO Statement

Net sales for the full year 2014 were slightly up overall, with higher sales in Sweden and Denmark offsetting a decline in Norway following the termination of the ICA Norway contract as of 1 April 2014. Excluding this contract, net sales rose by 7 percent in local currency. The retail market for chicken products in Scandinavia increased by approximately 3 percent* in value for the full year. Group sales increased ahead of the retail market in Sweden and Denmark but behind in Norway.

Adjusted operating income and margin for the full year were lower than 2013 pro forma due to the loss of the ICA Norway contract. The impact of the loss of this contract was to a large extent offset by a strong performance in Sweden and operational cost-savings. In the fourth quarter both operating income and margin improved, benefitting from cost-savings and a more favourable inventory position than last year.

The refinancing of the bank loans in July at lower interest rates led to significantly lower finance expense. As a result, adjusted income for the period and adjusted earnings per share increased strongly both for the quarter and the full year.

Adjusted operating cash flow showed a substantial improvement for the full year, helped by inventory reductions this year compared to increases last year.

Net sales in Sweden showed strong growth and the adjusted operating income and margin improved both for the quarter and the full year. In Denmark, net sales and adjusted operating income also increased for both periods.

In Norway, the process to replace the sales lost on the ICA Norway contract has taken longer than anticipated. The decline in net sales in Norway was more pronounced in the fourth quarter as the whole retail market for chicken products was affected by extensive media coverage regarding bacteria in chicken. The media focus has continued into 2015 with an ongoing negative impact on demand for chicken products. This, in combination with the loss of the ICA contract, will impact negatively in 2015.

In Scandi Standard we go to great lengths to safeguard the healthiness of our products and we believe that chicken products in Norway, as well as in Sweden and Denmark, are among the healthiest in the world. Scandinavian chicken products are generally regarded as being of the highest quality due to the strict standards applied on matters of animal health and welfare and the fact that neither antibiotics nor growth hormones are used in the feed process.

Our product innovation programme delivered a number of successful product launches in the year. We will continue to increase our efforts in this area going forward to support our vision of Scandinavians eating chicken at least once more per week. The acquisition of Bosarpskyckling is a valuable addition to the Group in this respect as it creates a new platform for growth in the premium organic segment. We are now looking to increase the number of external farms that are able to supply organic chicken.

Our actions to improve operational efficiency continued as planned. The number of chickens processed per employee per day in our main plant in Sweden increased by 26 percent from 2013. In Norway, we managed to reduce operating costs but the number of chickens processed per employee and day declined by 16 percent because of the sharp fall in sales volumes. The lower cost base creates a good platform for improved efficiency in production going forward.

We made good progress in many areas during 2014 and strengthened our position as the market leader in chicken-based food products in Scandinavia. The adjusted operating income for the Group was below our initial expectations due to the decline in sales in Norway, but this has not caused us to change our medium-term financial targets communicated in June 2014.

Leif Bergvall Hansen Managing Director and CEO

*Source: Nielsen Research (at actual FX rates)

Net sales and income

Fourth quarter

Net sales for the fourth quarter of 2014 decreased by 4 percent to 1,252.0 (1,306.8) MSEK and by 6 percent at constant exchange rates compared to the corresponding period last year. Excluding the ICA Norway contract last year, net sales increased by 3 percent in local currency.

Net sales in Sweden increased by 3 percent, while net sales in local currency increased by 3 percent in Denmark and declined by 29 percent in Norway.

Net sales by product category in local currency showed an increase of 1 percent for chilled products, while sales of frozen products declined by 5 percent.

Operating income amounted to 73.5 (57.2) MSEK, including non-comparable items of -6.1 (-19.8) MSEK. For a description of non-comparable items, see table on page 4. Adjusted for these items operating income was 79.6 (77.0) MSEK, corresponding to an adjusted operating margin of 6.4 (5.9) percent. Adjusted operating income showed a strong increase in Sweden and Denmark, more than offsetting a decrease in Norway.

Adjusted income for the period amounted to 48.1 (16.5) MSEK, benefitting from significantly lower finance expenses following the refinancing of the loans post the Initial Public Offering, as well as a lower tax rate than in 2013 which was impacted by transaction related non-deductible expenses. Adjusted earnings per share improved to 0.80 (0.33) SEK.

Full year

Net sales for the full year 2014 increased by 1 percent to 5,267.2 (5,192.4 pro forma) MSEK, and were flat at constant exchange rates, compared to the previous year. Excluding the ICA Norway contract, net sales increased by 7 percent in local currency. The termination of the ICA Norway contract was effective as of 1 April 2014.

Net sales in Sweden increased by 9 percent, while net sales in local currency increased by 2 percent in Denmark and declined by 16 percent in Norway.

Net sales by product category in local currency showed an increase of 1 percent for chilled products, while sales of frozen products were approximately flat on the previous year.

Operating income amounted to 238.5 (162.9 pro forma) MSEK, including non-comparable items of -62.5 (-154.3) MSEK. For a description of non-comparable items, see table on page 4. Adjusted for these items, operating income was 301.0 (317.2 pro forma) MSEK, corresponding to an adjusted operating margin of 5.7 (6.1 pro forma) percent. Adjusted operating income showed an increase in Sweden and Denmark, offsetting a decrease in Norway.

Adjusted income for the period increased to 145.1 (89.2 pro forma) MSEK, benefitting from significantly lower finance expenses in the second half of the year and lower taxes. Adjusted earnings per share were 2.63 (1.78 pro forma) SEK.

Financial summary

	Q4	Q4			Pro forma
MSEK	2014	2013	Change	2014	2013	Change
Net sales	1,252.0	1,306.8	-4%	5,267.2	5,192.4	1%
Operating income	73.5	57.2	29%	238.5	162.9	46%
Income for the period	42.9	2.9	n.a	56.1	-30.0	n.a
Adjusted EBITDA1)	118.8	117.0	2%	470.2	479.0	-2%
Adjusted EBITDA margin1)	9.5%	9.0%	-	8.9%	9.2%	-
Adjusted operating income1)	79.6	77.0	3%	301.0	317.2	-5%
Adjusted operating margin1)	6.4%	5.9%	-	5.7%	6.1%	-
Adjusted income after finance net1,2) Adjusted income for the	61.2	38.5	59%	189.8	166.3	14%
period1,2,3)	48.1	16.5	192%	145.1	89.2	63%
Adjusted EPS1,2,3)	0.80	0.33	143%	2.63	1.78	48%
Adjusted return on operating capital Adjusted return on capital	-	-	-	13.6%	-	-
employed 1-3) See table below	-	-	-	12.9%	-	-

Non-comparable items in EBITDA and operating income	Q4 2014	Q4 2013	2014	Pro forma 2013
IPO costsa	-	-	-36.5	-
Transition costsb	-1.4	-7.9	-13.9	-9.7
Monitoring feesc	-	-1.8	-5.8	-1.8
Transaction costsd	-0.7	-3.7	-2.3	-150.8
Pension revaluatione	-4.0	-6.4	-4.0	8.0
1)Total	-6.1	-19.8	-62.5	-154.3
Non-comparable items in finance net
2)Refinancingf	-	-	-51.0	-
3)Tax effect on adjustments	0.9	6.2	24.5	35.1
Non-comparable items in income for the period	-5.2	-13.6	-89.0	-119.2

^a) Non-recurring costs related to the IPO.

^b) Transition costs related to the carve-out of the Swedish and Danish operations from Lantmännen, e.g IS/IT costs, which is now complete.

c) Monitoring fees charged by prior owners, which ceased at the time of the IPO.

d) Revaluation of acquired stock and contracts (PPA) and deal fees following the acquisitions in 2013/2014 by Scandi Standard. These costs are non-recurring.

e) Non-comparable items regarding pension revaluation arose from the closure of the defined benefit scheme. These are now complete.

f) Non-recurring write-off arrangement fees related to the old credit facility.

Segment information

Sweden

					Pro forma
MSEK	Q4 2014	Q4 2013	Change	2014	2013	Change
Net sales	488.0	473.5	3%	2,055.2	1,883.4	9%
Adjusted operating income*	33.9	16.9	101%	113.8	74.9	52%
Adjusted operating margin*	6.9%	3.6%	-	5.5%	4.0%	-

*) For a description of adjustments, see page 10.

Net sales in Sweden in the fourth quarter increased by 3 percent to 488.0 (473.5) MSEK driven by continued good growth in the market. The increase in sales referred mainly to chilled products contributing to an improvement of the operating margin.

Newly launched products continued to develop well, most notably Kronfågel Minutfilé and the Kronfågel Max products. The integration of Bosarpskyckling, which was acquired as of 1 September 2014, was completed in the quarter.

Adjusted operating income rose by 101 percent to 33.9 (16.9) MSEK as compared to a weak fourth quarter last year, which was impacted by high inventory levels. The adjusted operating margin increased to 6.9 (3.6) percent helped by improvements in operational efficiency.

					Pro forma
MSEK	Q4 2014	Q4 2013	Change	2014	2013	Change
Net sales	554.3	513.5	8%	2,209.2	2,066.5	7%
Adjusted operating income* Adjusted operating	32.3	23.4	38%	104.3	95.3	9%
margin*	5.8%	4.6%	-	4.7%	4.6%	-
MDKK	Q4 2014	Q4 2013	Change	2014	Pro forma 2013	Change
Net sales	445.2	432.3	3%	1,810.4	1,781.7	2%
Adjusted operating income*	25.9	19.7	32%	85.5	82.2	4%
Adjusted operating margin*	5.8%	4.6%	-	4.7%	4.6%	-

Denmark

*) For a description of adjustments, see page 10.

Net sales in Denmark in the fourth quarter increased by 8 percent to 554.3 (513.5) MSEK, and by 3 percent in local currency, driven mainly by better retail sales of chilled chicken products. Export sales of frozen products were lower than last year. The stronger mix of chilled products contributed to an improved operating margin in the quarter.

Product launches in the quarter included Danpo Tartelet filling and Danpo Chicken á l'Orange.

Adjusted operating income increased by 38 percent to 32.3 (23.4) MSEK and the adjusted operating margin improved to 5.8 percent (4.6).

					Pro
					forma
MSEK	Q4 2014	Q4 2013	Change	2014	2013	Change
Net sales Adjusted operating	278.8	389.3	-28%	1,270.0	1,538.6	-18%
income*	25.0	36.1	-31%	119.8	162.7	-26%
Adjusted operating margin*	9.0%	9.3%	-	9.4%	10.6%	-
					Pro
					forma
MNOK	Q4 2014	Q4 2013	Change	2014	2013	Change
Net sales Adjusted operating	257.9	361.3	-29%	1,165.7	1,386.8	-16%
income*	22.9	33.7	-32%	110.0	146.6	-25%
Adjusted operating margin*	9.0%	9.3%	-	9.4%	10.6%	-

Norway

*) For a description of adjustments, see page 10.

Net sales in Norway in the fourth quarter declined by 28 percent to 278.8 (389.3) MSEK, and by 29 percent in local currency. The decline was mainly due to the termination of the contract with ICA Norway as of 1 April 2014. The impact of the termination of this contract has been partly offset by new sales and product listings with existing and new customers. Sales in the quarter were also negatively impacted by a decline in the local retail market for chilled chicken products following extensive media coverage regarding bacteria in chicken. Excluding the ICA Norway contract, net sales in Norway increased by 8 percent in local currency in the quarter.

Adjusted operating income amounted to 25.0 (36.1) MSEK, corresponding to an adjusted operating margin of 9.0 (9.3) percent. The decrease in income and margin is attributable to the termination of the ICA contract. The margin was positively affected by implemented costsavings.

Cash flow and investments

Adjusted operating cash flow increased to 64.5 (-53.2) MSEK in the fourth quarter 2014 and to 438.1 (176.1 pro forma) MSEK for the full year 2014. Cash flow for the full year was positively impacted by a reduction of inventories of 91.6 MSEK compared to an increase in inventories of 155.3 MSEK in 2013. In the fourth quarter inventories increased, mostly in Norway, but that was offset by favourable receivables and payables.

Working capital as of 31 December 2014 amounted to 349.9 (485.6) MSEK, corresponding to 6.6 percent of net sales compared to 9.4 percent at year-end 2013.

Capital expenditure was 63.2 (46.5) MSEK in the quarter and 141.3 (164.o) MSEK for the full year, of which approximately half related to productivity improvement projects, mostly in Sweden and Norway.

Adjusted operating cash flow
				Pro forma
MSEK	Q4 2014	Q4 2013	2014	2013
Adjusted EBITDA*)	118.8	117.0	470.2	479.0
Capital expenditure	-63.2	-46.5	-141.3	-164.0
Change in inventories	-35.6	-84.9	91.6	-155.3
Change in other working capital	44.5	-38.8	17.6	14.4
Adjusted operating cash flow	64.5	-53.2	438.1	176.1

*) For a description of adjustments, see page 4.

Financial position

Net interest-bearing debt as of 31 December 2014 amounted to 1,405.5 MSEK compared to 1,598.1 MSEK at year-end 2013 (excluding shareholders loans on which interest was accrued but not paid and which were converted to equity in connection with the IPO).

Net debt/EBITDA amounted to 3.0x (3.3x pro forma) adjusted EBITDA. Cash and cash equivalents amounted to 89.7 (71.8) MSEK. Non-operating increases in net debt in the year included the acquisition of Bosarpskyckling of 33 MSEK, deal fees, monitoring and transition fees of 58 MSEK and the write-off of arrangement fees relating to the replaced bank debt of 51 MSEK.

Total equity increased to 886.2 (432.4) MSEK, mainly due to the conversion of the shareholder loans. The equity to assets ratio was 28.6 (13.3) percent at year-end.

Refinancing

A new five-year loan arrangement with a coalition of banks was available as of 2 July 2014, consisting of a term loan of 750 MSEK, a revolving credit facility of 750 MSEK and an overdraft facility of 400 MSEK.

The average interest rate on the bank loans in 2013 was 6.5 percent. The average interest cost on the bank loans in the quarter was 2.6 percent. For more details see note 4 on page 23.

Personnel

The average number of employees (FTE) was 1,622 (1,681) in the quarter and 1,647 (1,677) for the full year.

Transactions with related parties

Scandi Standard has agreements with Lantmännen, a major shareholder, for the rental of the facilities in Valla and Åsljunga. In the fourth quarter 2014, rental costs under these agreements were 3.2 (3.2) MSEK. In January 2015, Lantmännen sold the Valla premises to a third party. The divestment has had no impact on the terms of the leasing contract, which expires in 2026.

The parent company had sales of 17.4 (-) MSEK to and purchases in the amount of 0 (0) MSEK from its subsidiaries.

Annual General Meeting

The Annual General Meeting (AGM) 2015 will be held on 27 April at 4 pm at Bryggarsalen, Norrtullsgatan 12N in Stockholm, Sweden. More information about the AGM will be available on: http://investors.scandistandard.com/en/agm.

Dividend

The Board of Directors proposes a dividend for 2014 of 1.30 SEK per share, for a total dividend payment of approximately 78.1 MSEK. The proposed dividend corresponds to approximately 54 percent of adjusted income for the period. The company's dividend policy is to distribute a dividend of 60 percent of adjusted income for the period on average over time.

Financial targets

The medium term financial targets communicated in June 2014 remain unchanged. These are to achieve:

• Annual average organic growth in net sales in line with or above the market.
• An EBITDA margin exceeding 10 percent.
• Net debt/EBITDA within the range of 2.0 to 2.5 times EBITDA (LTM).

Risks and uncertainties

Scandi Standards' risks and uncertainties are described on pages 13-20 in the IPO prospectus, which is available on www.scandistandard.com, and in this fourth quarter and year-end report.

Stockholm, 25 February 2015

Leif Bergvall Hansen Managing Director and CEO

The report has not been subject to review by the Company's auditors.

This is a translation of the original Swedish version published on www.scandistandard.com.

Segment information compared to actual figures for Q4 2013 and pro forma full year 2013

Net sales

				Jan-Dec	Pro forma Jan-Dec
MSEK	Q4 2014	Q4 2013	Change	2014	2013	Change
Sweden	488.0	473.5	3%	2,055.2	1,883.4	9%
Denmark	554.3	513.5	8%	2,209.2	2,066.5	7%
Norway Intra-group	278.8	389.3	-28%	1,270.0	1,538.6	-18%
eliminations	-69.1	-69.5	-1%	-267.2	-296.1	-10%
Total net sales	1,252.0	1,306.8	-4%	5,267.2	5,192.4	1%

Net sales

				forma
Q4 2014	Q4 2013	Change	2014	2013	Change
445.2	432.3	3%	1,810.4	1,781.7	2%
257.9	361.3	-29%	1,165.7	1,386.8	-16%
-	-	-6%		-	0%
				Jan-Dec	Pro Jan-Dec

Net sales by product category

MSEK	Q4 2014	Q4 2013	Change	Jan-Dec 2014	Pro forma Jan-Dec 2013	Change
Chilled	527.5	521.2	1%	2,234.9	2,183.7	2%
Frozen	564.1	585.9	-4%	2,360.8	2,293.7	3%
Eggs	86.3	117.7	-27%	358.4	454.1	-21%
Other*	74.1	82.0	-10%	313.1	260.9	20%
Total net sales	1,252.0	1,306.8	-4%	5,267.2	5,192.4	1%

Net sales by product category

Change in local currency	Q4 2014 vs Q4 2013	2014 vs Pro forma 2013
Chilled	1%	1%
Frozen	-5%	-0%
Eggs	-27%	-20%

Exchange rates

	Q4 2014	Q4 2013	2014	2013
SEK/NOK	1.08	1.08	1.09	1.11
SEK/DKK	1.25	1.19	1.22	1.16

*) Relates mainly to Swehatch sales of day-old chicks to farmers

Adjusted operating income

	Q4	Q4		Jan-Dec	Pro forma Jan-Dec
MSEK	2014	2013	Change	2014	2013	Change
Sweden	33.9	16.9	101%	113.8	74.9	52%
Denmark	32.3	23.4	38%	104.3	95.3	9%
Norway	25.0	36.1	-31%	119.8	162.7	-26%
Group	-6.5	5.1	n.a	-17.8	2.7	n.a
Amortisation	-5.1	-4.5	n.a	-19.1	-18.4	n.a
Total	79.6	77.0	3%	301.0	317.2	-5%

Adjusted operating

income
					Pro forma
	Q4	Q4		Jan-Dec	Jan-Dec
Local currency	2014	2013	Change	2014	2013	Change
Denmark	25.9	19.7	32%	85.5	82.2	4%
Norway	22.9	33.7	-32%	110.0	146.6	-25%

Adjustments to operating income

	Q4	Q4	Jan-Dec	Pro forma Jan-Dec
MSEK	2014	2013	2014	2013
Sweden	-4.2	-4.4	-13.9	-5.6
Denmark	-	-1.7	-1.4	-2.3
Norway Group and	-	-3.3	-0.7	-17.3
amortisation	-1.9	-10.4	-46.5	-129.1
Total	-6.1	-19.8	-62.5	-154.3

Operating income

				Pro forma
	Q4	Q4	Jan-Dec	Jan-Dec
MSEK	2014	2013	2014	2013
Sweden	29.7	12.5	99.9	69.3
Denmark	32.3	21.7	102.9	93.0
Norway	25.0	32.8	119.1	145.4
Group	-8.4	-5.3	-64.3	-126.4
Amortisations	-5.1	-4.5	-19.1	-18.4
Total	73.5	57.2	238.5	162.9

Finance net	-18.4	-38.4	-162.2	-150.8
Income tax expense	-12.2	-15.9	-20.2	-42.1
Income for the period	42.9	2.9	56.1	-30.0

Consolidated income statement compared to actual figures for Q4 2013 and pro forma full year 2013

			Jan-Dec	Pro forma Jan-Dec
MSEK	Q4 2014	Q4 2013	2014	2013
Net sales	1,252.0	1,306.8	5,267.2	5,192.4
Other operating revenues Changes in inventories of finished goods and	4.2	3.6	19.0	18.8
work in progress	17.2	12.6	-100.8	72.2
Raw materials and consumables	-727.7	-800.7	-3,014.9	-3,239.8
Cost of personnel	-242.9	-230.6	-947.4	-872.7
Depreciation, amortisation and impairment	-42.6	-41.4	-171.5	-163.4
Other operating expenses	-190.0	-194.8	-815.3	-846.3
Share of income of associates	3.3	1.7	2.2	1.7
Operating income	73.5	57.2	238.5	162.9
Finance income	2.8	4.3	3.1	5.6
Finance expenses	-21.2	-42.7	-165.3	-156.4
Income after finance net	55.1	18.8	76.3	12.1
Income tax expense	-12.2	-15.9	-20.2	-42.1
Income for the period	42.9	2.9	56.1	-30.0
Whereof attributable to shareholders of the Parent Company	42.9	2.9	56.1	-30.0
Average number of shares 1)	60,060,890	50,071,6732)	55,238,2602)	50,071,6732)
Earnings per share, SEK	0.71	0.06	1.02	-0.60
Number of shares at the end of the period	60 060 890	50 071 6732)	60 060 8902)	50 071 6732)
1) No dilution effect in number of shares 2) Adjusted for the reversed split 27 June 2014

Consolidated statement of other comprehensive income compared to actual figures for Q4 2013 and pro forma full year 2013

MSEK	Q4 2014	Q4 2013	Jan Dec 2014	Pro forma Jan-Dec 2013
Income for the period	42.9	2.9	56.1	-30.0
Other comprehensive income
Items that will not be reclassified to the income statement:
Actuarial gains and losses in defined benefit pension plans	-3.8	2.3	-19.2	24.1
Tax on actuarial gains and losses	0.8	-0.4	4.2	-5.2
Total	-3.0	1.9	-15.0	18.9
Items that will or may be reclassified to the income statement
Cash flow hedges	-0.8	0.6	-5.5	2.8
Currency effects from conversion of foreign operations	-12.7	33.1	53.9	8.3
Income from currency hedging of foreign operations	14.4	-31.8	-31.4	-9.9
Tax attributable to items that will be reclassified to the income
statement	-3.1	6.6	8.2	1.2
Total	-2.2	8.5	25.2	2.4
Other comprehensive income for the period, net of tax	-5.2	10.4	10.2	21.3
Total comprehensive income for the period	37.7	13.3	66.3	-8.7
Whereof attributable to shareholders of the Parent Company	37.7	13.3	66.3	-8.7

			Jan-Dec
MSEK	Q4 2014	Q4 2013	2014	3 Jun-Dec 2013
Net sales	1,252.0	1,306.8	5,267.2	3,031.6
Other operating revenues	4.2	3.6	19.0	9.2
Changes in inventories of
finished goods and work in
progress	17.2	12.6	-100.8	63.1
Raw materials and
consumables	-727.7	-800.7	-3,014.9	-1,937.7
Cost of personnel Depreciation, amortization	-242.9	-230.6	-947.4	-504.4
and impairment	-42.6	-41.4	-171.5	-96.2
Other operating expenses	-190.0	-194.8	-815.3	-530.6
Share of income of associates	3.3	1.7	2.2	1.5
Operating income	73.5	57.2	238.5	36.5
Finance income	2.8	4.3	3.1	5.6
Finance expenses	-21.2	-42.7	-165.3	-94.9
Income after finance net	55.1	18.8	76.3	-52.8
Income tax expense	-12.2	-15.9	-20.2	-27.1
Income for the period	42.9	2.9	56.1	-79.9
Whereof attributable to
shareholders of the Parent
Company	42.9	2.9	56.1	-79.9
Average number of shares 1	60,060,890	50,071,6732	55,238,2602	44,851,4512
Earnings per share, SEK	0.71	0.06	1.02	-1.78
Number of shares at the end
of the period	60,060,890	50,071,6732	60,060,8902	50,071,6732
1) No dilution effect in number
of shares
2) Adjusted for the reversed
split 27 June 2014

Consolidated income statement compared to actual figures for 2013

Consolidated statement of other comprehensive income compared to actual figures for 2013

MSEK	Q4 2014	Q4 2013	Jan Dec 2014	3 Jun – Dec 2013
Income for the period	42.9	2.9	56.1	-79.9
Other comprehensive income
Items that will not be reclassified to the income statement:
Actuarial gains and losses in defined benefit pension plans	-3.8	2.3	-19.2	9.0
Tax on actuarial gains and losses	0.8	-0.4	4.2	-1.9
Total	-3.0	1.9	-15.0	7.1
Items that will or may be reclassified to the income statement
Cash flow hedges	-0.8	0.6	-5.5	2.9
Currency effects from conversion of foreign operations	-12.7	33.1	53.9	10.0
Income from currency hedging of foreign operations	14.4	-31.8	31.4	-10.0
Tax attributable to items that will be reclassified to the income
statement	-3.1	6.6	8.2	1.6
Total	-2.2	8.5	25.2	4.5
Other comprehensive income for the period, net of tax	-5.2	10.4	10.2	11.6
Total comprehensive income for the period	37.7	13.3	66.3	-68.7
Whereof attributable to shareholders of the Parent Company	37.7	13.3	66.3	-68.7

Consolidated statement of financial position

MSEK	31 Dec 2014	31 Dec 2013
Assets
Non-current assets
Goodwill	611.3	589.7
Other intangible assets	528.7	528.0
Property plant and equipment	809.9	798.0
Participations in associated companies	42.7	38.7
Deferred tax assets	45.3	90.0
Financial assets	1.8	6.7
Surplus in funded pension plans	-	4.9
Other fixed assets	0.5	-
Total non-current assets	2,040.2	2,056.0
Current assets
Inventory	546.6	624.4
Trade receivables and other receivables	417.4	496.2
Short term investments	1.4	1.0
Cash and cash equivalents	89.7	71.8
Total current assets	1,055.1	1,193.4
Total assets	3,095.3	3,249.4
Shareholder´s equity
Share capital	0.6	0
Other contributed equity	888.1	500.7
Reserves	29.4	4.2
Retained earnings	-31.9	-72.5
Total equity	886.2	432.4
Liabilities
Non-current liabilities
Non-current interest bearing liabilities	1,460.2	1,423.7
Shareholder loans	-	348.3
Provisions for pensions	20.4	3.0
Deferred tax liabilities	75.5	139.0
Other non-current provisions	-	2.0
Non-interest bearing liabilities	-	23.0
Total non-current liabilities	1,556.1	1,939.0
Current liabilities
Current interest bearing liabilities	38.9	243.0
Trade payables and other current liabilities	589.8	595.0
Tax payables	24.3	40.0
Total current liabilities	653.0	878.0
Total equity and liabilities	3,095.3	3,249.4

Consolidated statement of changes in equity

MSEK
Opening balance 3 June 2013	500.7
Income for the period	-79.9
Other comprehensive income	11.6
Total comprehensive income	-68.3
Total transactions with the owners	-
Closing balance 31 December 2013	432.4
Opening balance 1 January 2014	432.4
Income for the period	56.1
Other comprehensive income	10.2
Total comprehensive income	66.3
New share issue	6.2
Set-off of shareholder loans	381.3
Total transactions with the owners	387.5
Closing balance 31 December 2014	886.2

Consolidated statement of cash flows

MSEK	Q4 2014	Jan-Dec 2014	3 June – Dec 2013
Operating activities
Operating income	73.5	238.5	36.5
Adjustment for non-cash items	53.2	180.0	153.0
Paid finance items net	-21.8	-97.0	-73.0
Paid current income tax	-3.9	-44.0	-24.9
Cash flows from operating activities before changes in operating capital	101.0	277.5	91.6
Changes in inventories	-35.6	91.6	-115.1
Changes in operating receivables	56.8	45.0	-117.0
Changes in operating payables	-12.3	-27.4	128.0
Cash flows from operating activities	109.9	386.7	-12.5
Investing activities
Acquisition or business combination	-	-30.7	-1,948.0
Investment in property, plant and equipment	-64.0	-142.3	-91.0
Sales of fixed assets	0.8	1.0	1.3
Cash used in investing activities	-63.2	-172.0	-2,037.7
Financing activities
New share issue	-	6.2	500.7
Net change in external loans	-166.2	-207.9	1,621.3
Cash flows from financing activities	-166.2	-201.7	2,122.0
Cash flows for the period	-119.5	13.0	71.8
Cash and cash equivalents at beginning of the period	207.6	71.8	-
Currency effect in cash and cash equivalents	1.6	4.9	-
Cash flow for the period	-119.5	13.0	71.8
Cash and cash equivalents at the end of
the period	89.7	89.7	71.8

The cash flow for Q4 2013 has not been prepared due to the complete change in the capital structure of the Group. An adjusted operating cash flow comparison is presented on page 6.

Parent company income statement

MSEK	Jan–Dec 2014	Feb-Dec 2013
Net sales	17.4	-
Operating expenses	-56.8	-2.0
Operating income	-39.4	-2.0
Finance net	21.7	3.0
Profit before income tax	-17.7	1.0
Total income tax expense	2.3	-2.0
Income for the period	-15.4	-1.0

Parent company statement of comprehensive income

MSEK	Jan-Dec 2014	Feb-Dec 2013
Income for the period	-15.4	-1.0
Other comprehensive income	-	-
Total comprehensive income for the period	-15.4	-1.0

Parent company statement of financial position

MSEK	31 Dec 2014	31 Dec 2013
Assets
Investments in subsidiaries	532.7	532.7
Receivables on Group entities	358.7	477.7
Deferred tax assets	2.3	-
Total non-current assets	893.7	1,010.4
Receivables on Group entities	14.3	-
Other current receivables	14.3	-
Cash and cash equivalents	-	-
Total current assets	14.3	-
Total assets	908.0	1,010.4
Equity
Share capital	0.6	0.0
Share premium reserve	888.1	501.2
Retained earnings	-1.0	-
Income for the period	-15.4	-1.0
Total equity	872.3	500.2
Liabilities
Interest bearing liabilities	-	483.3
Total non-current liabilities	-	483.3
Tax liability	2.2	2.2
Liabilities to group entities	33.5	-
Accrued expenses	-	24.7
Total current liabilities	35.7	26.9
Total equity and liabilities	908.0	1,010.4

Parent company statement of changes in equity

MSEK

Opening balance 1 February 2013	501.2
Income for the period	-1.0
Other comprehensive income	-
Total comprehensive income	-1.0
Total transactions with the owners	-
Closing balance 31 Dec 2013	500.2
Opening balance 1 January 2014	500.2
Income for the period	-15.4
Other comprehensive income	-
Total comprehensive income	-15.4
New share issue	6.2
Set-off of shareholder loans	381.3
Total transactions with the owners	387.5
Closing balance 31 Dec 2014	872.3

Parent company statement of cash flows

MSEK	Q4 2014	Q4 2013	Jan-Dec 2014	Feb-Dec 2013
Operating activities
Operating income	-33.6	-2.0	-39.4	-2.0
Adjustment for non-cash items:
Paid finance items net	17.4	-0.5	21.7	-
Paid current income tax	-	0.4	-	-
Cash flows from operating activities before
changes in operating capital	-16.2	-2.1	-17.7	-2.0
Changes in operating receivables	-14.3	-	-	-
Changes in operating payables	-1.9	2.4	25.8	2.0
Cash flows from operating activities	-32.4	0.3	8.1	-
Investing activities
Acquisition of subsidiaries	-	-0.3	-	-533.0
Lending to subsidiaries	8.6	-	-14.3	-451.3
Cash used in investing activities	8.6	-0.3	-14.3	-984.3
Financing activities
New share issue	-	-	6.2	501.0
Borrowing	-	-	-	483.3
Cash flows from financing activities	-	-	6.2	984.3
Cash flows for the period	-23.8	-	-	-
Cash and cash equivalents at beginning of the
period	9.5	-	-	-
Cash flows for the period	-9.5	-	-	-
Cash and cash equivalents at the end of the period	-	-	-	-

Notes to the condensed consolidated financial information

Note 1. Principles of accounting

Scandi Standard applies International Financial Reporting Standards (IFRS) as adopted by the European Union. This report has been prepared in accordance with IAS 34, Interim Financial Reporting, and ÅRL, the Swedish Annual Accounts Act and recommendation RFR 1, Accounting for legal entities, issued by the Swedish Financial Reporting Board. There are no changes in the Group's accounting and valuation principles compared with the accounting and valuation principles described in Note 1 of the Annual Report 2013.

Note 2. Segment information

Scandi Standard's business is operationally divided into the countries of Sweden, Denmark and Norway

Internal reporting to Group Management and the Board corresponds with the Group's operational structure. The division is based on the Group's operations from a geographic perspective. Those countries where business is operated equals the Group segments. The segments are managed on the basis of sales and operating results. The responsibility for the Group's financial assets and liabilities, provisions for taxes and pensions, gains and losses on the re-measurement of financial instruments according to IAS 39 and pension obligations according to IAS 19R are dealt with by the corporate functions and are not allocated to the segments. All capital expenditure on property, plant and equipment and intangible assets, apart from expendable equipment, is included in the segments' investments.

Segment Sweden comprises the companies Kronfågel AB, SweHatch AB, Bosarpskyckling AB and Skånefågel AB. SweHatch engages in the rearing, production and hatching of day-old chickens for Kronfågel AB's breeders and other small players in the Swedish market. Kronfågel AB is the segment's largest business engaged in slaughtering, production and development of fresh and frozen chicken products, mainly for the Swedish market. AB Skånefågel slaughters and sells products for the Swedish market and export.

Segment Denmark comprises Danpo A/S and the associate Farmfood A/S. Danpo slaughters, produces, develops and processes chicken products for both the Danish market and exports within Europe and to Asia. Farmfood processes slaughterhouse byproducts from the Group's different segments, mainly for use in pet food sold in the international markets.

Segment Norway comprises Den Stolte Hane Jæren AS, Den Stolte Hane Egg AS and Scandi Standard Norway AS. In addition there is an associate Naerbo kyllingslakt AB. The segment consists of two parts the production, processing and sale of chicken products and the packing of eggs in the segment's own egg packing facility. Both types of product are sold in the Norwegian market. The segment also handles and sells small quantities of turkey and duck.

Note 3. Scandi Standard AB pro forma accounts 2013

The Scandi Standard group was created on 3 June 2013. The Group's first annual accounts provide financial figures for the development of the remaining part of that year and do not include a full twelvemonth period. The purpose of the pro forma accounts 2013 is to show what the results would have been if the Group had been formed on 1 January 2013 instead. The pro forma accounts have been created as an illustration of:

• The individual companies (estimated) financial results for the period January May 2013, i.e. to the period up until the actual creation of the Group.
• The real financial results for the period June December 2013.
• The Group's balance sheet for 2013 is considered to be the same as shown in the company's annual account.

The pro forma accounts describe a hypothetical situation and have only been developed for illustrative purposes. Any potential synergy effects have not been considered and no further combination or transaction costs in addition to those described in the annual accounts have been added. The pro forma accounts shall not be seen as an indication of how the Group will perform going forward. All supportive financial information has been prepared according to IFRS as adopted by the EU. The pro forma accounts have also been prepared in accordance with the accounting principles as described in the company's annual account for 2013.

Pro forma adjustments

According to IFRS, the fair value of acquired assets and liabilities are measured on the acquisition date (purchase price allocation). Acquired values that do not relate to identifiable assets and liabilities are recognized as goodwill. In Scandi Standard's purchase price allocation, parts of the value have been attributed to customer and supplier relations, which are amortized over 10 years. In the pro forma financial statements such amortization has been made for the full year 2013 with the assumption that the value of the assets was the same as at actual acquisition date.

Adjustments in the financial statements according to IFRS have also been made regarding financial instruments (IAS39) and pensions (IAS19R) in accordance with applicable rules and practices.

As the financial situation of the Group changed significantly in conjunction with its establishment, adjustments for interest rates have been done in the financial statements. There, adjustments have also been made for actual interest rates existing during the period up until June 2013.

For a more detailed description of the Group as a whole and the establishment of the same, as well as the constituent companies, refer to the consolidated annual report for 2013.

Note 4. The Group's financial assets and liabilities measured at fair value

New credit facility

As of 2 July 2014, a new five-year loan arrangement with a coalition of banks (the "new credit facility") was available to refinance the existing debt in the Company and to ensure financing of the operations.

The new credit facility consists of a term loan of 750 MSEK in combination with a revolving credit facility of 750 MSEK and an overdraft facility of 400 MSEK. The new credit facility is conditional upon Scandi Standard fulfilling certain customary financial covenants, including that certain key financial indicators, such as net debt/EBITDA and interest coverage ratio, do not deviate negatively from certain levels specified in the agreement. The new credit facility is not secured, but is subject to customary negative undertakings, including not to pledge the Company's assets and restrictions regarding indebtedness in the Company's subsidiaries and divestments.

Other interest-bearing liabilities

A shareholder loan of 147.2 MSEK including accrued interest from Lantmännen was repaid out of a new credit facility on 2 July 2014.

As of 2 July, the company is financed by the new credit facility and shareholders´equity.

Derivative instruments and hedge accounting

Holdings of financial derivative instruments comprise interest rate swaps, interest rate caps and currency forward contracts. Derivative instruments are carried at fair value and the result of the re-measurement affects the income statement when the derivative does not qualify for hedge accounting. Hedge accounting may be applied if certain criteria are met with regard to documentation of the hedge relationship and the hedge effectiveness. Financial instruments that are hedging instruments hedge either an asset or a liability, a net investment in foreign operations or are a hedge of an actual or forecast transaction. IAS 39 defines three different hedging relationships: cash flow hedges, hedging of net investments and fair value hedges. Scandi Standard currently only applies cash flow hedging and hedging of net investments.

Equity hedging of translation exposure

Translation exposure is the effect of changes in exchange rates when foreign subsidiaries' income statements and statements of financial position are translated into the Group's reporting currency (SEK). Currency hedging of investments in foreign subsidiaries (net assets including goodwill on consolidation) is managed by means of loans in the subsidiaries' currencies, and is referred to as the equity hedge. These loans are recognized at the closing rate on the reporting date. In the company with the loans, exchange differences attributable to these loans (net of tax) are reported under other comprehensive income. The currency effect derived from the translation of the subsidiaries net assets that arises in the Group consolidation are also reported under other comprehensive income where it partly offset the currency effect in the company with the loans. At present, net investments in DKK and NOK are hedged.

Definitions

Operating capital

Total assets less cash and cash equivalents and non-interest-bearing liabilities, including deferred tax liabilities.

Return on operating capital

Operating income last twelve months (LTM) divided by average operating capital.

Capital employed

Total assets less non-interest-bearing liabilities, including deferred tax liabilities.

Return on capital employed

Operating income plus interest income LTM divided by average capital employed.

Net interest-bearing debt

Interest-bearing debt excluding arrangement fees less cash and cash equivalents.

Conference call

A conference call for investors, analysts and media will be held on 25 February at 10:00 AM CET.

The dial-in numbers are: UK: +44 20 300 924 55 SE: +46 8 5055 6453 US: +1 855 228 3719

Confirmation code: 350990#

Slides used in the conference call can be downloaded at www.scandistandard.com under Investor Relations. A replay of the conference call will be available on the web site afterwards.

Further information

For further information, please contact:

Leif Bergvall Hansen, Chief Executive Officer, Tel: +45 22 10 05 44 Jonathan Mason, Chief Financial Officer, Tel: +45 22 77 86 18 Patrik Linzenbold, Head of Investor Relations, Tel: +46 708 25 26 30

Financial calendar

• Annual General Meeting 27 April 2015.
• Annual Report to be published on the website on or about 10 April 2015
• Interim report for the first quarter 2015: 28 May 2015.
• Interim report for the second quarter 2015: 27 August 2015.

This interim report comprises information which Scandi Standard is required to disclose under the Securities Markets Act and/or the Financial Instruments Trading Act. It was released for publication at 07:30 CET on 25 February 2015.

Forward looking statement

Some statements in this report are forward-looking, and the actual outcome could be materially different. In addition to the factors explicitly discussed, other factors could have a material effect on the actual outcome. Such factors include, but are not limited to, general business conditions, fluctuations in exchange rates and interest rates, political developments, the impact of competing products and their pricing, product development, commercialization and technological difficulties, interruptions in supply, and major customer credit losses.

Scandi Standard AB (publ)

Franzengatan 5 104 25 Stockholm Reg no. 556921-0627

www.scandistandard.com