Studsvik — Interim / Quarterly Report 2018

Oct 22, 2018

Interim Report January - September 2018

• Sales in the third quarter were SEK 167.2 (183.3) million, which in local currencies means a decrease of 14 per cent.
• Operating profit for the third quarter amounted to SEK 9.5 (15.5) million. Items affecting comparability of SEK 9.7 (–0.1) million are included.
• Free cash flow during the quarter was SEK −0.8 (–10.4) million

	July September	July September	January September	January September	Full year
	2018	2017	2018	2017	2017
Sales, SEK million	167.2	183.3	538.6	539.5	704.8
Operating profit, SEK million	9.5	15.5	33.7	−5.9	–41.6
Profit after tax, SEK million	4.5	11.1	14.9	−15.0	–45.0
Free cash flow, SEK million	−0.8	−10.4	24.8	−53.5	–84.2
Net debt, SEK million	73.4	71.2	73.4	71.2	101.2
Net debt/equity ratio, %	22.9	23.1	22.9	23.1	35.1
Profit per share after tax, SEK	0.55	1.35	1.81	−1.83	–5.47
Equity per share, SEK	39.02	37.76	39.02	37.76	35.09

Sales

Sales during the quarter were SEK 167.2 (183.3) million and during the first three quarters of the year SEK 538.6 (539.5) million. In local currencies this was a decrease of 14 and 3 per cent respectively.

Profit

Operating profit for the quarter decreased to SEK 9.5 (15.5) million. During the year to date earnings improved to SEK 33.7 (–5.9) million. The operating profit for the quarter includes a profit of SEK 13.6 million from the sale of Horsviks Gård. Adjusted for items affecting comparability of SEK 9.7 (–0.1) million for the quarter and SEK 8.3 (–6.2) million for the first three quarters of the year, the operating margin decreased during the quarter to –0.1 (8.5) per cent, while during the year to date it increased to 4.7 (0.1) per cent.

Loss after financial items in the quarter was SEK –3.5 (–4.6) million and during the year to date SEK –11.4 (–13.4) million. Profit after tax deteriorated to SEK 4.5 (11.1) million for the quarter. During the year to date, however, earnings improved to SEK 14.9 (–15.0) million.

Fuel and Materials Technology

Sales increased during the quarter to SEK 40.0 (36.0) million and during the first three quarters of the year to SEK 159.9 (140.6) million. In local currencies the increase was 11 per cent for the quarter and 14 per cent for the three first quarters.

Operating profit for the third quarter increased to SEK 0.7 (–3.6) million and during the first three quarters of the year to SEK 18.4 (7.1) million. The operating margin for the quarter increased to 1.8 (–10) per cent and for the first three quarters to 11.5 (5.3) per cent. The improvement in the margin is mainly from more effective treatment of operational waste. Capacity utilization in production is high and the order situation for the year is strong.

Consultancy Services

Sales decreased during the quarter to SEK 18.8 (39.8) million and during the first three quarters of the year to SEK 59.4 (101.5) million. In local currencies this was a decrease of 56 per cent for the quarter and 42 per cent for the three first quarters. The reduced sales are due to discontinuation of low-margin services in England and Sweden. During the third quarter of the previous year license revenue of SEK 22 million was received in connection with the signing of the cooperation agreement in China for FBSR technology.

The operating profit for the third quarter decreased to SEK –8.7 (15.5) million and for the first three quarters of the year to SEK –7.6 (15.8) million. Adjusted for items affecting comparability of SEK 2.5 (2.6) million for the quarter, the operating margin for the quarter decreased to –33.0 (45.5) per cent and for the first three quarters to –6.2 (18.1) per cent. In August Mikael Karlsson was appointed as new business area head.

Scandpower

Sales increased during the quarter to SEK 31.2 (19.6) million and during the first three quarters of the year to SEK 97.8 (56.4) million. In local currencies the increase

was 48 per cent for the quarter and 72 per cent for the three first quarters. Just over SEK 8 million of the sales for the quarter are related to TVEL and thus most of the order totaling SEK 38 million from TVEL is included in sales for the year to date. In addition, demand during the year for other software and supplementary orders has been good. The work to obtain licenses from the American authorities to export ordered software to China is continuing.

The operating profit for the quarter improved to SEK 1.2 (–2.7) million and for the first three quarters of the year to SEK 20.9 (–9.8) million. The operating margin for the quarter increased to 3.8 (–13.8) per cent and for the half year to 21.4 (–17.4) per cent.

Germany

Sales during the quarter were SEK 78.3 (81.9) million and during the first three quarters of the year SEK 219.6 (226.6) million. In local currencies this was a decrease of 12 per cent for the quarter and 9 per cent for the three first quarters. The decrease in sales in due to lower capacity utilization of staff working on refueling and maintenance outages in German nuclear power plants.

The operating profit for the quarter decreased to SEK 2.5 (10.7) million and for the first three quarters of the year to SEK –2.6 (0.4) million. Adjusted for items affecting comparability of SEK 0 (2.5) million for the quarter and SEK 0 (0.0) million for the first three quarters, the operating margin for the quarter decreased to 3.2 (10.0) per cent and for the first three quarters to –1.2 (0.2) per cent.

Investments

Investments in the quarter amounted to SEK 7.7 (2.8) million and during the three first quarters to SEK 20.8 (15.2) million. The investments are mainly related to the Elekta order announced in January.

Cash flow

The free cash flow improved in the quarter to SEK –0.8 (–10.4) million and in the three first quarters to SEK 24.8 (–53.5) million.

Financial position and liquidity

Cash and cash equivalents after the three first quarters amounted to SEK 126.1 (128.2) million. Net interestbearing debt was SEK 73.4 (71.2) million, which meant a net debt/equity ratio of 22.9 (23.1) per cent.

Staff

The average number of employees after the three first quarters was 631 (668). The decrease is due to discontinuation of low-margin services in England, fewer employees in the German operations and outsourcing of property management of the Studsvik facility.

Transactions with related parties

During the quarter a dividend of SEK 0.3 (1.2) million was received from UK Nuclear Waste Management Ltd.

Parent company

Operations in the parent company consist of coordination of the Group. Sales during the quarter were SEK 4.0 (4.6) million and during the first three quarters SEK 12.1 (14.7) million. The operating profit for the quarter amounted to SEK 0.2 (–3.1) million and SEK –5.9 (–13.2) million for the first three quarters.

Loss after financial items in the quarter was SEK –6.3 (–9.7) million and for the first three quarters SEK –3.8 (–29.4) million. Net financial income for the quarter includes revaluation of intra-group loans by SEK –2.7 (–5.2) million and for the three first quarters SEK 10.1 (–11.6) million. Cash and cash equivalents including current investments amounted to SEK 32.2 (8.2) million and interest-bearing liabilities to SEK 199.5 (199.9) million.

Risks and uncertainties

An overall analysis of the Group's risks and how they are dealt with is given in the Annual Report, which is available on the company's website. Apart from these risks, no further significant risks are deemed to have arisen.

Accounting policies

Studsvik applies the International Financial Reporting Standards (IFRS) approved by the European Commission. This interim report was prepared for the Group in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. For the parent company, the Swedish Financial Reporting Board recommendation RFR 2 Accounting for Legal Entities and the Annual Accounts Act are applied. The accounting policies applied are in line with what is stated in the Annual Report for 2017, with the exception of new standards and revisions of standards and interpretations to be applied to the financial year starting on January 1, 2018 and that were not already applied when preparing the 2017 Annual Report. The standards that have an impact on the Group's financial statements and are being applied for the first time in the financial year starting on January 1, 2018 are set out below:

IFRS 9: Financial instruments IFRS 15: Revenue from contracts with customers

The amendments to these standards have not had any material impact on the financial reporting, apart from extended disclosure requirements. The accounting policies and valuation principles applicable to these new standards are presented on page 38 of the Annual Report for 2017. A number of new or amended standards and interpretations will not come into force until the coming financial year and have not been applied early when preparing the financial statements. There will be no early application of new or amended standards effective as of financial years after 2018 and none of these are expected to have any material impact on the Group's financial statements.

The preliminary transition effect of SEK 1.5 million communicated in the year-end report for 2017 proved on final analysis to relate to a customer contract that was also recognized in income in 2017 in accordance

with earlier principles. The amount was recognized in revenue in the income statement for 2017. Consequently, the company does not report any transition effect for transition to IFRS 15.

Stockholm, October 22, 2018 Camilla Hoflund President/CEO

This report has not been reviewed by the company's auditors.

Time Schedule for Financial Information

Year-end Report 2018	February 14, 2019
Interim report January-March 2019	April 29, 2019
Interim report January-June 2019	July 22, 2019
Interim report January-September 2019	October 22, 2019

For further information, please contact

Pål Jarness, Chief Financial Officer, +46 155 22 10 09 or Camilla Hoflund, President and Chief Executive Officer, +46 155 22 10 66.

The interim report will be presented at a conference call to be held in English, on October 22 at 2:00 p.m. Further information for those interested in participating is available at www.studsvik.com.

Consolidated statement of profit or loss and other comprehensive income

Amounts in SEK million	July September 2018	July September 2017	January September 2018	January September 2017	Full year 2017
Net sales	167.2	183.3	538.6	539.5	704.8
Cost of services sold	−125.6	−126.8	−386.1	−404.1	–539.1
Gross profit	41.6	56.5	152.4	135.4	165.7
Selling and marketing expenses	−9.0	−10.2	−29.1	−33.5	–44.2
Administrative expenses	−22.5	−25.2	−76.5	−84.8	–116.9
Research and development costs	−7.9	−7.2	−21.1	−21.1	–28.2
Share in earnings from associated companies	1.7	1.8	9.0	6.6	8.7
Other operating income	13.6	1.0	16.5	1.9	2.8
Other operating expenses	−7.9	−1.1	−17.6	−10.3	–29.5
Operating profit	9.5	15.5	33.7	−5.9	–41.6
Financial income	2.9	−0.8	3.2	0.0	1.0
Financial expenses	−6.5	−3.3	−14.0	−11.3	–15.3
Fair value gain/loss (realized and unrealized)1)	0.1	-0.5	−0.6	−2.1	–2.8
Profit/loss before tax	6.1	10.9	22.3	−19.3	–58.7
Income tax	−1.6	0.2	−7.4	4.3	13.7
NET PROFIT/LOSS FOR THE PERIOD	4.5	11.1	14.9	−15.0	–45.0
Other comprehensive income
Items that may later be reversed in the income statement
Translation differences on foreign subsidiaries1)	−4.5	−9.9	18.0	−18.2	–9.9
Cash flow hedging	0.3	1.0	−0.9	4.0	4.1
Income tax on items recognized in other comprehensive income	−0.1	−0.2	0.2	−0.9	–0.9
Other comprehensive income for the period, net after tax	−4.3	−9.1	17.3	−15.0	–6.7
Total profit/loss and other comprehensive income for the period	0.2	2.0	32.2	−30.0	–51.7
Income for the period attributable to
Parent company's shareholders	4.5	11.1	14.9	−15.0	–45.0
Non-controlling interests	0.0	0.0	0.0	0.0	0.0
Total comprehensive income attributable to
Parent company's shareholders	0.3	2.0	32.2	−29.9	–51.6
Non-controlling interests	−0.1	0.0	0.0	−0.1	–0.1
Earnings per share calculated on income attributable to the parent company's shareholders during the period, SEK
Earnings per share (There is no dilution effect)
Profit/loss from continuing operations	0.55	1.35	1.81	−1.83	–5.47
NET PROFIT/LOSS FOR THE PERIOD	0.55	1.35	1.81	−1.83	–5.47

1) Net financial income and the translation difference in other comprehensive income have been adjusted in comparison with previous reports. The effect of this adjustment is presented in Note 1.

Group statement of financial position

Amounts in SEK million	September	September	December
	2018	2017	2017
ASSETS
Intangible assets	186.1	172.8	177.4
Property, plant and equipment	122.8	115.6	116.6
Other non-current assets	167.0	143.3	162.6
Total non-current assets	475.9	431.8	456.6
Inventories	1.2	1.6	0.6
Trade receivables	181.4	157.5	158.9
Other current receivables	126.1	132.0	110.1
Cash and cash equivalents	126.1	128.2	98.7
Total current assets	434.8	419.3	368.3
TOTAL ASSETS	910.7	851.1	824,9
EQUITY AND LIABILITIES
Equity attributable to parent company's shareholders	320.4	309.9	288.1
Non-controlling interests	0.3	0.3	0.3
Total equity	320.7	310.2	288.4
Borrowing	0.0	199.5	199.9
Provisions and other non-current liabilities	163.7	159.2	164.8
Total non-current liabilities	163.7	358.7	364.7
Trade and other payables	226.8	182.2	171.8
Borrowing	199.5	0.0	0.0
Total current liabilities	426.3	182.2	171.8
TOTAL EQUITY AND LIABILITIES	910.7	851.1	824.9

Changes in equity

Amounts in SEK million

Amounts in SEK million					Equity
		Other			attributable to the parent	Non
	Share	contributed		Retained	company's	controlling
	capital	capital	Reserves	earnings	shareholders	interest	Total equity
Equity at December 31, 2016	8.2	225.3	11.4	103.2	348.1	0.4	348.5
Changes January 1 – September 30, 2017
Dividend	0.0	0.0	0.0	–8,2	–8,2	0.0	–8,2
Comprehensive income for the period	0.0	0.0	–15.0	–15.0	−30.0	–0.1	–30.1
Equity at June 30, 2017	8.2	225.3	-3,6	80.0	309.9	0.3	310.2
Changes October 1 – December 31, 2017
Comprehensive income for the period	0.0	0.0	8.4	−30.1	–21.9	0.0	–21,9
Equity at December 31, 2017	8.2	225.3	4.8	49.9	288.2	0.3	288.5
Changes January 1 – September 30, 2018
Comprehensive income for the period	0.0	0.0	17.3	14.9	32.2	0.0	32.2
Equity at September 30, 2018	8.2	225.3	22.1	64.8	320.4	0.3	320.7

Group statement of cash flow

Amounts in SEK million Total operations	July September 2018	July September 2017	January September 2018	January September 2017	Full year 2017
Cash flow from operating activities
Operating profit	9.5	15.5	33.7	−5.9	–41.6
Adjustment for non-cash items	5.5	3.3	6.2	5.1	16.1
Financial items, net	−3.6	−3.2	−10.8	−9.9	–9.0
Income tax paid	−1.8	−3.8	−6.3	−10.4	–6.5
Cash flow from operating activities before change in working capital	9.6	11.8	22.8	−21.1	–41.0
Change in working capital	−4.0	−20.5	16.2	−25.7	–32.1
Cash flow from operating activities	5.6	−8.8	39.0	−46.8	–73.1
Investing activities
Acquisition of property, plant and equipment	−7.7	−2.8	−20.8	−15.2	–22.1
Acquisition in associated companies	–	–	–	–	–
Divestment of subsidiaries	–	–	–	–	–
Dividend from associated companies	0.3	1.2	5.6	8.5	11.0
Other cash flow from investing activities	1.0	–	1.0	–	–
Cash flow from investment activities	−6.4	−1.6	−14.2	−6.7	–11.1
Free cash flow	−0.8	−10.4	24.8	−53.5	–84.2
Financing activities
Change in borrowing	0.0	0.0	0.0	0.0	0.0
Dividend to shareholders	0.0	0.0	0.0	−8.2	–8.2
Cash flow from financing activities	0.0	0.0	0.0	−8.2	–8.2
Changes in cash and cash equivalents	−0.8	−10.4	24.8	−61.7	–92.4
Cash and cash equivalents at the beginning of the period	127.5	140.8	98.7	195.4	195.4
Translation difference	−0.6	−2.3	2.6	−5.4	–4.3
Cash and cash equivalents at the end of the period	126.1	128.2	126.1	128.2	98.7

Financial ratios for the Group

Amounts in SEK million	January	January	Full year
	September	September
	2018	2017	2017
Margins
Operating margin, %	6.3	−1.1	–5.9
Profit margin, %	4.1	−3.6	–8.3
Return on investment
Return on capital employed, %	7.2	−1.0	–7.8
Return on equity, %	4.9	−4.5	–14.1
Capital structure
Capital employed	520.2	509.7	488.3
Equity	320.7	310.2	288.4
Net debt	73.4	71.2	101.2
Net debt/equity ratio, %	22.9	23.1	35.1
Equity/assets ratio, %	35.2	36.5	35.0
Employees
Average number of employees	631	668	662
Net sales per employee	1.1	1.1	1.1

Data per share	July September 2018	July September 2017	January September 2018	January September 2017	Full year 2017
Number of shares at the end of the period	8,218,611	8,218,611	8,218,611	8,218,611	8,218,611
Average number of shares	8,218,611	8,218,611	8,218,611	8,218,611	8,218,611
Earnings per share before and after dilution
Profit/loss from continuing operations	0.55	1.35	1.81	−1.83	–5.47
Profit/loss for the period	0.55	1.35	1.81	−1.83	–5.47
Equity per share, SEK	39.02	37.76	39.02	37.76	35.09

Net sales per geographical area

Amounts in SEK million	July	July	January	January	Full year
	September	September	September	September	2017
	2018	2017	2018	2017
Sweden	29.4	28.8	96.1	120.7	157.1
Europe	108.6	111.4	367.1	326.6	424.4
North America	17.7	15.6	43.0	51.3	72.7
Asia	11.9	27.7	32.4	41.0	50.6
Other	−0.4	−0.2	0.0	0.0	0.0
Total	167.2	183.3	538.6	539.5	704.8

Quarterly review

Amounts in SEK million	2016				2017				2018
Continuing operations	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
Net sales	171.6	176.3	164.6	246.3	179.6	176.6	183.3	165.4	197.4	174.0	167.2
Operating expenses	–160.9	–177.5	–176.5	–219.3	–181.6	–196.0	–167.8	–201.1	–175.2	–172.0	−157.7
Operating profit	10.7	–1.2	–11.9	27.0	–2.0	–19.4	15.5	–35.7	22.2	2.0	9.5
Financial items, net	–5.1	–6.6	–4.5	–9.0	–5.1	–3.7	–4.6	–3.7	–3.6	–4.4	−3.4
Profit/loss after financial	5.6	–7.8	–16.4	18.0	–7.1	–23.1	10.9	–39.4	18.6	–2.4	6.1
items

Financial data per segment

Amounts in SEK million

Total operations	Consultancy	Materials
July-September 2018	Services	Technology	Scandpower	Germany	Other	Elimination	Group
External sales revenue	16.6	39.2	28.6	77.0	5.8	0.0	167.2
Revenue from segment	2.2	0.8	2.6	1.3	5.8	−12.7	0.0
Operating profit	−8.7	0.7	1.2	2.5	13.8	0.0	9.5
Items affecting comparability	2.5	0.0	0.0	0.0	−12.2	0.0	−9.7
Adjusted operating profit	−6.2	0.7	1.2	2.5	1.6	0.0	−0.2
Assets	172.8	209.2	136.1	244.5	435.6	−287.5	910.7
Liabilities	140.5	181.3	41.1	218.1	296.5	−287.5	590.0
Investments	0.6	6.4	0.3	−0.1	0.5	0.0	7.7
Depreciation/amortization	0.3	3.0	0.2	0.3	0.9	0.0	4.7
Average number of employees	54	97	32	423	26	−	632
		Fuel and
	Consultancy	Materials
July-September 2017	Services	Technology	Scandpower	Germany	Other	Elimination	Group
External sales revenue	39.5	36.0	18.3	78.5	11.0	0.0	183.3
Revenue from segment	0.3	0.0	1.3	3.4	6.0	−11.0	0.0
Operating profit	15.5	−3.6	−2.7	10.7	−4.4	0.0	15.5
Items affecting comparability	2.6	0.0	0.0	−2.5	0.0	0.0	0.1
Adjusted operating profit	18.1	−3.6	−2.7	8.2	−4.4	0.0	15.6
Assets	156.9	183.9	93.6	241.3	430.4	−254.9	851.1
Liabilities	125.2	151.6	20.6	206.3	291.1	−254.9	540.9
Investments	0.2	1.9	0.1	0.0	0.6	0.0	2.8
Depreciation/amortization	0.4	2.4	0.2	−0.2	0.9	0.0	3.7
Average number of employees	53	100	34	439	38	−	664
		Fuel and
	Consultancy	Materials
January-September 2018	Services	Technology	Scandpower	Germany	Other	Elimination	Group
External sales revenue	53.4	156.8	92.2	215.2	21.0	0.0	538.6
Revenue from segment	6.0	3.1	5.6	4.4	17.5	−36.6	0.0
Operating profit	−7.6	18.4	20.9	−2.6	4.6	0.0	33.7
Items affecting comparability	3.9	0.0	0.0	0.0	−12.2	0.0	−8.3
Adjusted operating profit	−3.7	18.4	20.9	−2.6	–7.6	0.0	25.4
Assets	172.8	209.2	136.1	244.5	435.6	−287.5	910.7
Liabilities	140.5	181.3	41.1	218.1	296.5	−287.5	590.0
Investments	2.0	15.7	0.5	0.1	2.5	0.0	20.8
Depreciation/amortization	1.0	9.1	0.6	0.8	2.8	0.0	14.3
Average number of employees	54	97	32	423	25	–	631
		Fuel and
	Consultancy	Materials
January-September 2017	Services	Technology	Scandpower	Germany	Other	Elimination	Group
External sales revenue	96.6	137.7	51.2	220.3	33.7	0-0	539.5
Revenue from segment	4.9	2.9	5.2	6.3	19.2	−38.5	0.0
Operating profit	15.8	7.1	−9.8	0.4	−19.4	0.0	−5.9
Items affecting comparability	2.6	0.3	0.0	0.0	3.3	0.0	6.2
Adjusted operating profit	18.4	7.4	−9.8	0.4	−16.1	0.0	0.3
Assets	156.9	183.9	93.6	241.3	430.3	−254.9	851.1
Liabilities	125.2	151.6	20.6	206.3	292.1	−254.9	540.9.
Investments	1.1	10.9	0.2	0.6	2.4	0.0	15.2
Depreciation/amortization	0.6	7.2	0.6	0.7	2.9	0.0	12.0
Average number of employees	58	100	34	439	37.	–	668
		Fuel and
	Consultancy	Materials
Full year 2017	Services	Technology	Scandpower	Germany	Other	Elimination	Group
External sales revenue	114.4	192.1	73.5	281.1	43.7	0.0	704.8
Revenue from segment	8.6	2.9	7.5	10.0	25.6	–54.6	0.0
Operating profit	11.3	5.3	–11.8	–8.4	–38.0	0.0	–41.6
Items affecting comparability	4.0	1.4	3.2	0.0	12.5	0.0	21.1
Adjusted operating profit	15.3	6.7	–8.6	–8.4	–25.5	0.0	–20.5
Assets	151.7	182.7	95.0	223.1	419.5	–247.1	824.9
Liabilities	120.2	151.0	22.5	191.1	298.8	–247.1	536.5
Investments	2.7	13.8	0.7	1.4	3.5	0.0	22.1
Depreciation/amortization	1.1	9.9	0.8	1.0	3.8	0.0	16.6
Average number of employees	57	101	34	435	35	–	662

Fuel and

Financial data per segment cont. - External sales per country Amounts in SEK million, total operation

		Fuel and
	Consultancy	Materials
July-September 2018	Services	Technology	Scandpower	Germany	Other	Total
Sales from
Germany	–	–	3.4	69.7	–	73.1
Switzerland	–	–	–	7.3	–	7.3
United Kingdom	8.8	–	–	–	–	8.8
USA	4.4	–	16.4	–	–	20.8
Sweden	3.4	38.2	8.8	–	5.8	56.2
France	–	–	–	–	–	–
Japan	–	1.0	–	–	–	1.0
Total	16.6	39.2	28.6	77.0	19.4	167.2
		Fuel and
	Consutancy	Materials
July-September 2017	Services	Technology	Scandpower	Germany	Other	Total
Sales from
Germany	–	–	4.5	67.3	–	71.8
Switzerland	–	–	–	11.2	–	11.2
United Kingdom	7.8	–	–	–	–	7.8
USA	27.2	–	10.1	–	–	37.3
Sweden	3.9	36.0	3.7	−	11.0	54.6
France	0.6	–	–	–	–	0.6
Japan	–	−	–	–	–	−
Total	39.5	36.0	18.3	78.5	11.0	183.3
		Fuel and
	Consultancy	Materials
January-September 2018	Services	Technology	Scandpower	Germany	Other	Total
Sales from
Germany	–	–	14.1	198.6	–	212.7
Switzerland	–	–	–	16.6	–	16.6
United Kingdom	19.2	–	–	–	–	19.2
USA	20.1	–	62.2	–	–	82.3
Sweden	13.1	152.0	15.9	–	21.0	202.0
France	1.0	–	–	–	–	1.0
Japan	–	4.8	–	–	–	4.8
Total	53.4	156.8	92.2	215.2	34.5	538.6
	Consultancy	Fuel and Materials
January-September 2017	Services	Technology	Scandpower	Germany	Other	Total
Sales from
Germany	–	–	13.8	199.5	–	213.3
Switzerland	–	–	–	20.8	–	20.8
United Kingdom	26.7	–	–	–	–	26.7
USA	45.0	–	28.0	–	–	73.0
Sweden	23.1	133.9	9.4	–	33.7	200.1
France	1.8	–	–	–	–	1.8
Japan	–	3.8	–	–	–	3.8
Total	96.6	137.7	51.2	220.3	33.7	539.5
		Fuel and
Full year 2017	Consultancy Services	Materials Technology	Scandpower	Germany	Other	Total
Sales from
Germany	–	–	19.1	256.2	–	275.3
Switzerland	–	–	–	24.9	–	24.9
United Kingdom	34.1	–	–	–	–	34.1
USA	51.8	–	40.9	–	–	92.7
Sweden	26.2	187.7	13.5	–	43.7	271.1
France	2.3	–	–	–	–	2.3
Japan	–	4.4	–	–	–	4.4
Total	114.4	192.1	73.5	281.1	43.7	704.8

Parent company income statement	July September	July September	January September	January September	Full year
Amounts in SEK million	2018	2017	2018	2017	2017
Net sales	4.0	4.6	12.1	14.7	19.7
Cost of services sold	0.0	0.0	0.0	−0.9	–0.9
Gross profit	4.0	4.6	12.1	13.8	18.8
Other operating income and costs	−3.8	−7.7	−18.0	−27.0	–47.8
Operating profit	0.2	−3.1	−5.9	−13.2	–29.0
Result from participations in Group companies	0.0	0.0	0.0	0.0	0.0
Net financial items	−6.5	−6.6	3.6	−16.1	–13.1
Profit/loss before tax	−6.3	−9.7	−2.3	−29.4	–42.1
Income tax	0.2	2.0	−1.5	6.3	9.3
NET PROFIT/LOSS FOR THE PERIOD	−6.1	−7.7	−3.8	−23.0	–32.8

Parent company balance sheet

Amounts in SEK million	September	September	December
	2018	2017	2017
ASSETS
Intangible assets	1.3	2.0	1.9
Property, plant and equipment	–	–	–
Financial non-current assets	659.0	635.6	643.8
Total non-current assets	660.3	637.6	645.7
Current assets	28.7	21.7	8.2
Cash and cash equivalents	32.2	8.2	24.9
Total current assets	60.9	29.9	33.1
TOTAL ASSETS	721.2	667.5	678.8
EQUITY AND LIABILITIES
Equity	242.0	255.5	245.7
Provisions	–	–	–
Non-current liabilities	43.6	241.9	243.4
Current liabilities	435.6	170.1	189.7
Total liabilities	479.2	412.0	433.1
TOTAL EQUITY AND LIABILITIES	721.2	667.5	678.8

	July	July	January	January	Full year
Note 1 Adjustment of translation difference	September	September	September	September	2017
and net financial income	2018	2017	2018	2017
Fair value gain/loss befor adjustment (realized and unrealized)	0.1	−5.7	–0.6	−13.7	–2.8
Adjustment	–	5.2	–	11.6	–
Fair value gain/loss after adjustments (realized and	0.1	−0.5	−0.6	−2.1	–2.8
unrealized)
Translation difference before adjustment	−4.5	−4.7	18.0	−6.5	–9.9
Adjustment	–	−5.2	–	−11.6	–
Translation difference after adjustment	−4.5	−9.9	18.0	−18.2	–9.9

Note 2 Fair value estimation

The tables below show financial instruments at fair value on the basis of their classification in the fair value hierarchy. The definition of the various levels can be found in the Annual Report, Note 2.3. The tables below refer to total operations.

The Group's assets and liabilities measured at fair value as at September 30, 2018 (MSEK)	Level 1	Level 2	Level 3
Assets
Financial assets at fair value through profit or loss		20.0	14.0
Derivatives used for hedging		3.1
Liabilities
Derivatives used for hedging		3.5
The Group's assets and liabilities measured at fair value as at December 31, 2017 (MSEK)	Level 1	Level 2	Level 3
Assets
Financial assets at fair value through profit or loss		17.9	13.0
Derivatives used for hedging		2.7
Liabilities
Derivatives used for hedging		2.9
Fair value of the Group's borrowings (MSEK)	September 30, 2018		December 31, 2017
Non-current loans	0.0		199.9
Current loans	199.5		–
Total loans	199.5		199.9

Reconciliations of key ratio

Return on capital employed Amounts in SEK million	September 2018	September 2017	Full year 2017
Profit/loss after financial items	22.3	−19.3	–58.7
Financial costs according to the income statement	14.0	11.3	15.3
Fair value - foreign exchange losses	−0.1	2.7	2.8
Total	36.2	−5.3	–40.6
Balance sheet total	824.9	901.0	901.0
Provisions and other long-term liabilities	−164.8	−161.7	–161.7
Trade and other payables	−171.8	−192.6	–192.6
Opening capital employed	488.3	546.7	546.7
Balance sheet total	910.7	851.2	824.9
Provisions and other long-term liabilities	−163.7	−159.3	–164.8
Trade and other payables	−226.8	−182.2	–171.8
Closing capital employed	520.2	509.7	488.3
Average capital employed	504.3	528.2	517.5
Return on capital employed	7.2	−1.0	–7.8

Return on equity	September	September	Full year 2017
Amounts in SEK million	2018	2017
Net profit/loss for the year	14.9	−15.0	–45.0
Total	14.9	−15.0	–45.0
Opening equity	288.4	348.5	348.5
Closing equity	320.7	310.2	288.4
Return on equity	4.9	−4.5	–14.1

Net debt Amounts in SEK million	September 2018	September 2017	Full year 2017
Current borrowing	199.5	–	–
Non-current borrowing	0.0	199.5	199.9
Total liabilities	199.5	199.5	199.9
Cash and cash equivalents	126.1	128.2	98.7
Net debt	73.4	71.2	101.2

Definitions of key figures and ratios

Some key figures and ratios used by company management and analysts to assess the Group's development have not been prepared in accordance with IFRS (International Financial Reporting Standards). The company management considers that these key figures and ratios make it easier for investors to analyze the Group's development.

Equity

The total of non-restricted and restricted equity at the end of the year. Average equity capital has been calculated as opening balance plus closing balance of equity capital, divided by two.

Equity per share

Equity divided by the number of shares at the end of the period.

Free cash flow

Cash flow from operating activities (after change in operating profit) minus cash flow from investing activities.

Sales revenue per employee

Sales revenue divided by average number of employees. For quarterly reports net sales are estimated on a full year basis.

Investments

Total of the acquisition of business/subsidairies and acquisition of intangible assest and property, plant and equipment.

Average number of employees

Average number of employees at the end of each month.

Net debt

Total long-term and short-term borrowing less cash and cash equivalents.

Net debt-equity ratio

Interest-bearing net debt divided by equity including non-controlling interests.

Earnings per share

Profit for the year divided by the average number of shares. The average number of shares has been calculated as a weighted average of all shares in issue for the year.

Return on equity

Profit for the year as a percentage of average equity.

Return on capital employed

Profit/loss after financial items with financial expenses, fair value losses and foreign exchange losses added back, as a percentage of average capital employed. For the comparison year, capital employed has been adjusted by estimated values for operations held for sale, and only calculated on the closing balance.

Interest coverage ratio

Profit after financial income divided by the financial expenses.

Operating margin

Operating result after amortization as a percentage of net sales.

Equity/assets ratio

Equity including non-controlling interests as a percentage of the balance sheet total.

Capital employed

Balance sheet total less non-interest-bearing liabilities. Average capital employed has been calculated as opening balance plus closing balance of capital employed, divided by two.

Profit margin

Profit before tax as a percentage of net sales.

Major shareholders, September 30, 2018
	Number of shares	Share, %
The Karinen Family	1,769,552	21.5
Briban Invest AB	1,285,492	15.6
Peter Gyllenhammar AB	930,000	11.3
The Girell Family	381,370	4.6
Credit Agricole Suisse SA	363,879	4.4
Avanza Pensionsförsäkring AB	292,032	3.5
Nordnet Pensionsförsäkring AB	258,131	3.1
Malte Edenius	250,000	3.0
Leif Lundin	196,000	2.4
Invus Investment AB	191,594	2.3
Total ten largest shareholders - holdings	5,918,050	72.0
Other shareholders	2,300,561	28.0
Total	8,218,611	100.0

The Studsvik share

Facts about Studsvik

Studsvik offers a range of advanced technical services to the global nuclear power industry. Studsvik's business focus areas are fuel and materials technology, reactor analysis software and consultancy services within waste treatment technology, decommissioning, NORM and solutions for final disposal. The company has 70 years nuclear technology and radiological service experience. Studsvik has 600 employees in 7 countries and the company's shares are listed on the Nasdaq Stockholm

This report is a translation of the Swedish statutory report. In the event of any discrepancies between this document and the Swedish original, the latter shall govern. The content of this interim report may not, in whole or part, be reproduced or stored in a machine-readable medium without the previous permission of Studsvik AB (publ).

Studsvik AB

SE-611 82 Nyköping, SWEDEN Telephone +46 155 22 10 00 Fax +46 155 26 30 70 E-mail studsvik@studsvik.com www.studsvik.com