OTHER FINANCIAL INFORMATION

Profitability, financial position and cash flow
The return on equity at the end of the period was 27 percent (31), and return on capital employed was 17 percent (20). Return on working capital P/WC (EBITA in relation to working capital) amounted to 54 percent (54).

At the end of the period the equity ratio amounted to 33 percent (34). Equity per share, excluding non-controlling interest, totalled SEK 10.60 (9.90). The Group's net debt at the end of the period amounted to SEK 2,976 million (2,389), excluding pension liabilities of SEK 387 million (373). The net debt/equity ratio, calculated on the basis of net debt excluding provisions for pensions amounted to 1.0 (0.9).

Cash and cash equivalents consisting of cash and bank equivalents and approved but non-utilised credit facilities amounted to SEK 1,893 million (861) at 31 December 2020.

Cash flow from operating activities amounted to SEK 1,050 million (667) during the period. Company acquisitions and disposals including settlement of contingent consideration regarding acquisitions implemented in previous years amounted to SEK 1,054 million (310). Investments in non-current assets totalled SEK 51 million (78) and disposal of non-current assets amounted to SEK 6 million (4). Repurchase of treasury shares amounted to SEK 0 million (42) and repurchase of call options amounted to SEK 23 million (23). Exercised and issued call options totalled SEK 43 million (31). Dividend paid to the shareholders of the Parent Company totalled SEK 269 million (336), corresponding to SEK 1.00 (1.25) per share. The dividend was paid out in the second quarter.

Employees
At the end of the period, the number of employees was 3,103 compared to 2,981 at the beginning of the financial year. During the period, completed acquisitions resulted in a increase of the number of employees by 247. The average number of employees in the latest 12-month period was 3,025.

Ownership structure
At the end of the period the share capital amounted to SEK 51.1 million.

Class of shares Number of shares Number of votes Percentage of capital Percentage of votes
Class A shares, 10 votes per share 12,885,744 128,857,440 4.7% 33.1%
Class B shares, 1 vote per share 259,908,240 259,908,240 95.3% 66.9%
Total number of shares before repurchases 272,793,984 388,765,680 100.0% 100.0%
Repurchased class B shares -3,567,272 1.3% 0.9%
Total number of shares after repurchases 269,226,712

Addtech has four outstanding call option programmes for a total of 3,638,000 shares. Call options issued on repurchased shares entail a dilution effect of about 0.3 percent during the latest 12-month period. Addtech's own shareholding is estimated to meet the needs of the outstanding call option programmes.

Outstanding programme Number of options Corresponding number of shares Proportion of total shares Exercise price per option Exercise price per share Expiration period
2020/2024 250,000 1,000,000 0.4% 538.10 134.53 4 Sep 2023 -5 Jun 2024
2019/2023 300,000 1,200,000 0.4% 321.80 80.45 5 Sep 2022 - 2 Jun 2023
2018/2022 300,000 1,200,000 0.4% 232.90 58.23 6 Sep 2021 - 3 Jun 2022
2017/2021 59,500 238,000 0.1% 178.50 44.62 14 Sep 2020 - 4 Jun 2021
Total 909,500 3,638,000

 

Acquisitions and disposals
During the period, 1 April to 30 September 2020 the following acquisitions were completed; Elkome Group Oy, Kaptas Oy and Elsystem i Perstorp AB was acquired to become part of the Automation business area. Fluidcontrol Oy was acquired to become part of the Components business area. Peter Andersson AB was acquired to become part of the Energy business area. Valutec Group AB and Martin Bruusgaard AS was acquired to become part of the Industrial Process business area. 

During the third quarter, three acquisitions took place.

On 1 October Satco Komponent AB, Sweden, was acquired to become part of the Components business area. Satco Komponent sells high-tech electronic components such as electro mechanical, RF and cooling components. Satco Komponent has two employees and annual sales of around SEK 18 million.

On 2 October Skyltar & Märken Gruppen AB, Sweden, was acquired to become part of the Energy business area. Skyltar & Märken Gruppen AB is a market leader in its niche providing innovative and customized signs and traffic safety solutions for the Swedish market. The Group has 23 employees and annual sales of around SEK 60 million.

On 1 December OF-Beteiligungs AG, Switzerland, was acquired to become part of the Power Solutions business area. OF Group is providing solutions for special vehicles such as driver seats and powertrain in central Europe and Italy. OF Group has a turnover of approximately EUR 16 million with 35 employees.

The purchase price allocation calculations for the acquisitions completed during the period 1 April – 31 December 2019 have now been finalised. No significant adjustments have been made to the calculations. Acquisitions completed as of the 2019/2020 financial year are distributed among the Group’s business areas as follows:

Acquisitions (disposals) Closing Net sales,
SEKm*
Number of employees* Business Area
Omni Ray AG, Switzerland April, 2019 330 65 Automation
Thurne Teknik AB, Sweden April, 2019 100 19 Industrial Process
AB N.O. Rönne, Sweden April, 2019 8 4 Industrial Process
Best Seating Systems Walter Tausch GmbH, Austria May, 2019 23 5 Power Solutions
Thiim A/S, Denmark June, 2019 70 15 Automation
Profelec Oy, Finland July, 2019 6 2 Energy
BKC Products Ltd., Great Britain August, 2019 12 5 Industrial Process
Promector Oy, Finland August, 2019 24 20 Automation
Wireco-NB Oy, Finland February, 2020 23 6 Energy
Caligo Industria Oy, Finland February, 2020 70 9 Industrial Process
DMC Digital Motor Control GmbH, Germany March, 2020 30 10 Power Solutions
Q-tronic B.V., Netherlands March, 2020 45 10 Power Solutions
Elkome Group Oy, Finland April, 2020 85 38 Automation
Peter Andersson AB, Sweden April, 2020 30 9 Energy
Valutec Group AB, Sweden April, 2020 350 45 Industrial Process
Fluidcontrol Oy, Finland September, 2020 41 20 Components
Kaptas Oy, Finland September, 2020 41 27 Automation
Elsystem i Perstorp AB, Sweden September, 2020 40 18 Automation
Martin Bruusgaard AS, Norway September, 2020 108 30 Industrial Process
Satco Komponent AB, Sweden October, 2020 18 2 Components
Skyltar & Märken Gruppen AB, Sweden October, 2020 60 23 Energy
OF-Beteiligungs AG, Switzerland December, 2020 170 35 Power Solutions
Powernor AS, Norway January, 2021 35 6 Power Solutions
Synective Labs AB, Sweden January, 2021 30 27 Automation
Impact Air Systems Ltd. och Impact Technical Services Ltd., Great Britain January, 2021 95 33 Industrial Process

* Refers to assessed condition at the time of acquisition and disposal, respectively, on a full-year basis.

 


If all acquisitions which have taken effect during the period had been completed on 1 April 2020, their impact would have been an estimated SEK 660 million on Group net sales, about SEK 50 million on operating profit and about SEK 35 million on profit after tax for the period.

Addtech normally employs an acquisition structure comprising basic purchase consideration and contingent consideration. The outcome of contingent purchase considerations is determined by the future earnings reached by the companies and is subject to a fixed maximum level. Of considerations not yet paid for acquisitions during the period, the discounted value amounts to SEK 150 million. The contingent purchase considerations fall due for payment within three years and the outcome is subject to a maximum of SEK 235 million. 

Transaction costs for acquisitions that resulted in an ownership transfer during the period, amounted to SEK 8 million (3) and are reported under Selling expenses.

Revaluation of contingent consideration had a positive net effect of SEK 7 million (22) during the period. The impact on profits are reported under Other operating income and Other operating expenses, respectively.

According to the preliminary acquisitions analyses, the assets and liabilities included in the acquisitions were as follows, during the period:

Carrying amount at acquisition date Adjustment to fair value Fair value
Intangible non-current assets 26 707 733
Other non-current assets 35 - 35
Inventories 119 - 119
Other current assets 323 - 323
Deferred tax liability/tax asset -4 -143 -147
Other liabilities -192 -31 -223
Acquired net assets 307 533 840
Goodwill 1) 701
Non-controlling interests -163
Consideration 2) 1,378
Less: cash and cash equivalents in acquired businesses -205
Less: consideration not yet paid -181
Effect on the Group’s cash and cash equivalents 992
1) Goodwill is justified by expected future sales trend and profitability as well as the personnel included in the acquired companies.
2) The consideration is stated excluding acquisition expenses.

With the acquisition of Valutec Group AB comes a commitment to acquire the remaining 14 percent of the company and this commitment is valued to SEK 98 million. With the acquisition of Martin Bruusgaard AS comes a commitment to acquire the remaining 20 percent of the company and this commitment is valued to SEK 24 million. These commitments are reported as a non-current interest-bearing liability.

 

Parent Company

Parent Company net sales amounted to SEK 47 million (47) and profit after financial items was SEK -11 million (-41). Net investments in non-current assets were SEK 0 million (0). The Parent Company's financial net debt was SEK 653 million (328) at the end of the period.