interim management statement - investor ab...group. financial permobil. investments (897) 136 381...

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Interim Management Statement Q1 2020Johan Forssell, CEOHelena Saxon, CFO

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• Historic crisis for people and society with significant impact on the global economy

• Focus on mitigating the negative impact on employees, customers, supply chains and production, securing liquidity and cash flow

• Important to balance short-term cost efficiency and long-term investments

Covid-19

• Investor is well prepared with a strong financial position

3

Q1 2020 Highlights

-10%Adjusted NAV

growth

12%Adjusted EBITA growth in major

subsidiaries

11% Value change, Investments in

EQT

2.9 SEK bn

invested in Listed

Companies

-11%TSR

(SIXRX -18%)

Sustainability Three focus areas and

related targets defined

Listed Companies

4

65%of tot. adjusted assets

297SEK bn

2.9

5

Listed Companies

#13 SEK bn invested Listed company

SEK 1.6bn SEK 0.2bn SEK 1.1bn

6

Engaged Ownership

EricssonContinued

investments to capture 5G

opportunities

AstraZenecaTagrisso proven effective against

specific lung cancer

SobiInitiated clinical study for the treatment of

complications associated with

covid-19

WärtsiläReorganization of Marine business to simplify business

structure

Patricia Industries

7


118SEK bn

Patricia Industries – Operational Development Q1 2020

6 percent organic sales growth, %

8

Vectura Mölnlycke Grand Group

LaborieBraunAbility

Permobil

7%

PiabSarnova-17%

-4%-2%

5%3%

15% 14%

1% Reported EBITA

growth

12%Adjusted EBITA

growth

• 6 percent service revenue growth• 6 percent adjusted EBITDA growth

9

Covid-19 Portfolio Implications Q2

Resilience Less resilience

~70%Estimated market valuePatricia Industries

~30%Estimated market valuePatricia Industries

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Supported by Personal Protective Equipment, Gloves and AntisepticsRelative resilience in

Chronic and Prevention wound care

Supported by data usage and callsSupported by good demand for

respiratory productsand personal protective equipment

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Fewer elective procedures withinUrology and GI

Customer industries affected by lockdowns Limited customer access Limited customer access

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A provider of advanced products for treatment and prevention of wounds and single-use surgical solutions

Q1 2020

• Organic sales growth +7 percent in constant currency. All regions grew, U.S. and Emerging Markets faster than the group

• Wound Care +6 percent. Chronic and prevention good growth

• Surgical +7 percent driven by Gloves, Antiseptics, Personal Protective Equipment

• Growth in these areas to some extent supported by covid-19

• Products related to elective procedures negatively impacted by covid-19

• EBITA margin essentially flat, adjusted margin approximately 1 p.p. higher

IFRS 16 implemented as of the first quarter 2019

0

5

10

15

20

25

30

35

0

50

100

150

200

250

300

350

400

450

Q116

Q216

Q316

Q416

Q117

Q217

Q317

Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

%EUR m.

Sales EBITDA, % EBITA, %

13

A provider of advanced mobility and seating rehab solutions

Q1 2020

• Organic sales growth +3 percent in constant currency

• Strong growth in APAC, North America grew slightly, EMEA lower

• Q1 as a whole relatively unaffected by covid-19, material impact during the latter part, especially in EMEA and increasingly North America, as access to customers became more limited

• EBITA margin improved slightly compared to last year


0

5

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25

0

200

400

600

800

1 000

1 200

1 400

Q116

Q216

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Q119

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Q120

%SEK m.


-15-10-50510152025303540

0

10

20

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60

Q116

Q216

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Q120

%USD m.


Negative impact from costs related to

acquisition of Cogentix

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A provider of innovative capital equipment and consumables for the diagnosis and treatment of urologic and gastrointestinal disorders

Q1 2020

• Organic sales growth -4 percent in constant currency

• Within Urology and GI, sales weakened significantly in March driven by sharp decline in elective procedures

• Maternal and child health business grew strongly as demand linked to childbirth procedures is more resilient

• Reported EBITA profitability includes USD 14m in costs related to the acquisition of Clinical Innovations, completed February 12, 2020


Negative impact from transaction and integration

costs related to Clinical Innovations

0

2

4

6

8

10

12

14

16

18

020406080

100120140160180200

Q117

Q217

Q317

Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

%USD m.


15

A specialty distributor of healthcare products in the U.S.

Q1 2020


• Strong growth in both Emergency Preparedness and Acute. Since March, significantly increased demand for personal protective equipment and respiratory products driven by covid-19

• EBITA margin continued to be impacted by continued investments in commercial resources, digital platform enhancements and warehouse optimization


Negative impact from Ambu transition

Positive impact from Ambu transition

16

A manufacturer of wheelchair accessible vehicles and wheelchair lifts

Q1 2020


• Strong growth in Consumer and Commercial WAVs. Since beginning of second quarter demand significantly depressed by covid-19-related lockdowns affecting dealers and consumers in several geographies

• Excluding USD 1.4m costs related to strategic project, EBITA margin slightly ahead of last year


0

2

4

6

8

10

12

0

50

100

150

200

250

Q116

Q216

Q316

Q416

Q117

Q217

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Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

%USD m.


0

5

10

15

20

25

30

35

40

0

50

100

150

200

250

300

350

400

450

Q117

Q217

Q317

Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

%SEK m.


17

A provider of gripping and moving solutions for automated manufacturing and logistics processes

Q1 2020

• Organic sales growth -2 percent in constant currency

• Americas grew slightly, Europe and APAC declined

• Solid growth in Ergonomic Handling, Vacuum Automation flat, Robotic Gripping significantly lower. Increased covid-19 impact on demand and supply chain in the beginning of second quarter

• Excluding SEK 5m in costs related to TAWI and prior acquisition, EBITA margin amounted to 23 percent. Profitability declined due to lower sales as well as strategic investments


Negative impact from transaction-

related costs

-30

-20

-10

0

10

20

30

40

50

0

500

1 000

1 500

2 000

2 500

3 000

3 500

Q116

Q216

Q316

Q416

Q117

Q217

Q317

Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

%SEK m.

Sales EBITDA reported, %

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A provider of mobile voice and broadband services in Sweden and Denmark

Q1 2020

• Subscription base +32,000 during the quarter

• Service revenue +6 percent

• EBITDA +6 percent excluding positive impact from VAT reclaim

• SEK 332m distribution to owners, of which SEK 133m to Patricia Industries


Negative impact from VAT rulings

Negative impact from VAT rulings

Investments in EQT

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41SEK bn

Investments in EQT

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11%Total value change (8% constant currency)

9%Total Return EQT AB

14%Value change, investments in EQT funds

0.9SEK bn

Net cash flow

The Longer Perspective

21

Sustainability –Future-Proofing Portfolio with Targets for 2030

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Business Ethics & Governance

Climate & Resource Efficiency

Diversity & Inclusion

50%Reduce CO2e emissions

compared to 2016

100%All companies have CO2e

targets related to products, services or value chain

40/60%Gender balance in management groups and boards of directors

at the portfolio level

100%All companies measure

perceived level of inclusionamong employees

100%Adhere to the Sustainability

Guidelines

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Solid Q1 but tougher

times ahead

Robust balance

sheet and liquidity

Will use strong

position wisely

Interim Management Statement Q1 2020Helena Saxon, CFO

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10-year Net Asset Value Development

25

0

50

100

150

200

250

300

350

400

450

500

13

SEK bn

1711 12 14 15 16 18 19 2010

378

438

Reported NAV

Adjusted NAV

Atlas Copco 23%

ABB 15%

AstraZeneca 15%SEB 10%

Ericsson 7%

Epiroc 7%

Nasdaq 6%

Sobi 6%

Saab 3%Wärtsilä 3%

Electrolux 2% Husqvarna 2%Electrolux

Professional 1%

Listed Companies

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Q1 2020 Summary

• Total contribution to NAV SEK -48bn• Listed Companies TSR -14%, SIXRX -18%

-50

0

50

100

-6

-8

-2-1

-11

-7

-4

-9

012

-10

-5

-3

Saab

Eric

sson

Epiro

c

Wär

tsilä

SEK bn

ABB

Atla

s C

opco

TSR, %

-23.6

10.3

Sobi

-18.8

86.6

-26.1

Elux

Pro

-14.4-2.1 -3.6

Nas

daq

-4.2

Astra

Zene

ca

Elec

trolu

x

-33.3

SEB

Hus

qvar

na

-39.7 -42.1

-10.8

Contribution to NAV (LHS) TSR (RHS)

SEK 297bn

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Patricia Industries – Development in Q1 2020

-2% - Negative impact from lower multiplesTotal return, excl. cash (-1 percent including cash)

Patricia Industries – Change in Estimated Market Values

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Q1 2020 Summary Estimated market value change

-1%total

returnincl. cash

2 515 1 006

263

(194) (206)(532)

(583)

(6 838)

Patricia Cash

Total NAV March 2020

Mölnlycke Sarnova BraunAbility Vectura The Grand Group

PermobilFinancial Investments

(897)136 381

(361)

PiabTotal NAV Dec 2019

Three Scandinavia

Laborie

1 097

131 651

Distributions/proceedsIncl. SEK 4.3bn

equity injection

Incl. SEK 2.9bn transfer to Investor

Major Drivers of Estimated Market Values Q1 2020

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CompanyEst. market value

change Q1 2020 vs. Q4 2019

Major drivers

SEK -0.6bn Lower multiples impacted negatively

SEK 1.0bn Currency and higher profit impacted positively, mitigated by lower multiples

SEK -0.9bn Lower multiples impacted negatively, mitigated by higher profit, SEK 133m distribution to Patricia Industries

SEK 1.1bn Higher profit and currency impacted positively, mitigated by lower multiples

SEK -1.8bn(excl. SEK 4.3bn equity injection)

Acquisition of Clinical Innovations, lower profit and lower multiples in “legacy” Laborie

Financial Position as of March 31, 2020

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• Leverage 4.7% (2.8% Dec 31, 2019)

• Net debt SEK 18.8bn

• Gross cash SEK 19.8bn

• Average maturity of the debt portfolio 10.8 years

Current ratingStandard & Poor’s AA-Moody’s Aa3

0

5

10

15

Q115

Q215

Q315

Q415

Q116

Q216

Q316

Q416

Q117

Q217

Q317

Q417

Q118

Q218

Q318

Q418

Q119

Q219

Q319

Q419

Q120

Percent

Target range Leverage

-20

-15

-10

-5

0

5

10

15

20

YTD 1 year 5 years 10 years 20 years

Percent

Investor B SIXRX

31

Average Annual Total Shareholder ReturnAs of March 31, 2020

Return requirement

We create value for people and society

by buildingstrong and sustainable

businesses

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Financial Calendar

Viveka Hirdman-RyrbergHead of Corporate Communication & Sustainability

+46 70 550 [email protected]

Magnus DalhammarHead of Investor Relations

+46 73 524 [email protected]

2020-07-17 Interim Report January – June 2020

2020-10-19Interim Management Statement January – September 2020

2020-01-21 Year End Report 2020

Contact

interim management statement - investor ab...group. financial permobil. investments (897) 136 381...

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