GROUP DEVELOPMENT

Group performance in the quarter

Net sales in the quarter increased by 5 percent to SEK 2,702m (2,570). Organic growth, excluding exchange rate effects, was 4 percent and the acquired growth was 1 percent. Exchange rate effects had a marginally negative impact on net sales during the quarter, amounting to SEK -6m.

Increased revenue with an improved gross margin and largely unchanged costs resulted in EBITA increased by 18 percent to SEK 343m (291), and the EBITA margin amounted to 12.7 percent (11.3). Exchange rate fluctuations negatively impacted EBITA by SEK -1m.

Net financial items amounted to SEK -63m (-86) and profit after financial items amounted to SEK 172m (100). Net financial items primarily include interest expenses related to financing of previous acquisitions and exchange rate fluctuations. Interest expenses amounted to SEK -58m (-77) and exchange rate loss to SEK -1m (-9). The profit after tax for the quarter was SEK 120m (63) and the effective tax rate was 30 percent (37). The slightly high effective tax rate is attributable to the effect of non-deductible interest.

The geopolitical situation in Ukraine and the Middle East has not had any significant economic impact on the financial reports, but it cannot be ruled out that it may do so in the future. With approximately 90 percent of sales and 80 percent of purchases in Europe, AddLife should not be heavily exposed to tariffs and trade barriers by the USA or by other countries as countermeasures. However, there is a risk that subcontractors and components further down the supply chain may be subject to tariffs or trade barriers. We are closely monitoring market developments regarding inflation, tariffs and trade barriers, raw material, component and freight costs, as well as interest rate trends.