Absolent Air Care : Interim report Q1

Air care for healthy growth

1. 1

Interim report 2023

Q1 2023

Summary

1 January - 31 March 2023

• Net sales amounted to SEK 358.8 (322.1) million, which corresponds to a growth of 11.4 (38.2) %.
• Operating result before amortizations and depreciations (EBITDA) increased by 9.7 % and amounted to SEK 68.2 (62.1) million, corresponding to a margin of 19.0 (19.3) %.
• Operating result (EBIT) increased by 11.3 % and amounted to SEK 57.8 (51.9) million, corresponding to a margin of 16.1 (16.1) %.
• Earnings per share amounted to SEK 3.43 (3.41).
• Cash flow from operating activitites amounted to SEK 32.8 (42.3) million.

002	Absolent Air Care Group

Q1 2023

Group key figures

Key figures	Jan-Mar	Jan-Mar	Jan-Dec	Rolling 12 months
	2023	2022	2022	Apr 2022-
				Mar 2023
Net sales, SEK thousands	358 826	322 105	1 339 321	1 376 042
Sales growth, %	11.4	38.2	30.1	23.0
Operating result before amortizations and	68 170	62 141	260 567	266 596
depreciations (EBITDA), SEK thousands
Operating margin before amortizations and	19.0	19.3	19.5	19.4
depreciations, %
Operating result (EBIT), SEK thousands	57 829	51 939	220 001	225 891
Operating margin, %	16.1	16.1	16.4	16.4
Cash flow from operating activities, SEK thousands	32 751	42 253	196 141	186 639
Total assets, SEK thousands	1 652 154	1 534 922	1 665 931	1 593 538
Equity ratio, %	44.9	37.6	41.7	41.4
Net cash (+) / net debt (-), SEK thousands	-287 539	-363 149	-293 128	-325 344
Earnings per share, SEK	3.43	3.41	13.40	13.42
Equity per share, SEK	65.59	51.02	61.33	58.31
Number of outstanding shares at the balance	11 320 968	11 320 968	11 320 968	11 320 968
sheet date
Average number of employees	482	454	457	481

For definitions of key figures, see the Group Annual Report for 2022, p. 107.

Absolent Air Care Group

003

Q1 2023

Commercial Kitchen

The Commercial Kitchen business area reports its highest sales ever for a single quarter, which is gratifying. The sales increase from SEK 64.6 million to SEK 76.0 million compared to the same quarter the previous year, is partly an effect of the acquisition of the Dutch company Nu-Air during the fourth quarter of 2022 and partly an effect of the other parts of the business area reporting good growth. As mentioned in previous reports, we have focused on securing the right balance between cost increases and price adjustments, and as a result of these efforts Commercial Kitchen reports an operating margin before amortizations and depreciations (EBITDA) for the quarter of 21.4 (19.3) %.

During the quarter, intensive work has been performed to integrate the business of the newly acquired Nu-Air with the Group's other Dutch company Tessu Systems. The companies now operate as one organization and several synergies are starting to be achieved. The integration of the companies' operations and the work with realizing synergies will continue during the year, and we have a positive view of this development.

CEO comments

A stable start of the year

We have started 2023 with good sales of SEK 358.8 (322.1) million, which is the highest ever sales reported by the Group for a single quarter. The growth amounted to 11.4 %, with positive contributions from our two business areas Industrial and Commercial Kitchen. In terms of result, we delivered a stable quarter compared to the previous year. The operating result before amortizations and depreciations (EBITDA) increased by 9.7 % from SEK 62.1 million to SEK 68.2 million, and the margin remained on a good level, 19.0 (19.3) %.

The future

During the quarter, the new product A•erity, Absolent's new product series of filter units for oil mist, has been launched. A•erity is also the Group's first product series that builds on an entirely new modular architecture, which means that the product can be easily modified to fit the various challenges our customers face. It is also significantly more energy efficient than its predecessors. Based on this modular product platform, we will launch several new products during the coming years that will give us a solid base for future organic growth and profitability.

Overall, the Group reported a stable quarter, and we have a positive view of the industry's long-term development and our potential for continued profitable growth.

Industrial

For the first quarter of the year, the Industrial business area reports solid sales of SEK 282.9 (257.6) million, which corresponds to an increase of 9.8 % compared to the same quarter the previous year. The operating margin before amortizations and depreciations amounted to 20.9 (20.4) %, where the margin for the current period includes negative currency effects of 1.0 % compared to the first quarter of 2022. The business area shows a good growth in the EMEA region, mainly driven by the Absolent and Filtermist brands. The Americas and APAC regions decreased slightly compared to the previous year.

Axel Berntsson, CEO and President

Gothenburg, in May 2023

004	Absolent Air Care Group

Q1 2023

The Group January - March 2023

Net sales

Net sales for the Group amounted to SEK 358.8 (322.1) million, which corresponds to a growth of 11.4 (38.2) %. The Industrial business area showed the largest growth, with a net sales increase from SEK 257.6 million to SEK 282.9 million. For Commer­­ cial Kitchen, the Group's other business area, net sales amounted to SEK 76.0 (64.6) million. Net sales strongly increased in the EMEA region, while the Americas region decreased and APAC was largely on par with the previous year.

Result

Operating result before amortizations and depreciations

(EBITDA) amounted to SEK 68.2 (62.1) million, which corresponds­ to a margin of 19.0 (19.3) %. Operating result (EBIT) amounted to SEK

57.8 (51.9) million with an operating margin of 16.1 (16.1) %. Transla- tion effects of foreign Group companies' results have impacted the operating result (EBIT) for the period with SEK 1.5 (1.3) million. The result improvement is driven by both of the Group's business areas. The Industrial business area's operating result (EBIT) increased from SEK 44.6 million to SEK 52.0 million. The Commercial Kitchen business area increased the operating result (EBIT) from SEK 10.4 million to SEK 13.3 million. The increase of EBIT in both business areas is an effect of both improved margin and increased net sales.

Other operating income and expenses in total are somewhat lower than the previous year due to currency effects.

Net financial items amounted to SEK -7.2(-3.5) million, where the increase is mainly attributed to increased interest payments due to higher interest levels. Result after tax amounted to SEK 38.8 (38.6) million.

Investments

During the period January-March, the Group has invested a total of SEK 3.6 (4.7) million in intangible and tangible fixed assets, where this period's investments mainly refer to capitalized product development costs and machinery.

Cash flow

Cash flow from operating activitites before changes in working capital amounted to SEK 40.0 (59.2) million and the cash flow after changes in working capital amounted to SEK 32.8 (42.3) million. The lower cash flow is mainly an effect of increased tax payments.

Financial position

Interest-bearing liabilities at the end of the period amounted to SEK

565.2 (633.1) million, of which SEK 68.1 (77.0) million refers to lease liabilities. The net debt for the Group amounted to SEK 287.5 (363.1) million, where the decrease is attributable to repayments.

The equity ratio improved by 7.3 percentage points and amounted to 44.9 (37.6) % at the end of the period. The Parent company's­ has renewed and increased the credit facility with the bank Nordea during the quarter. The credit facility has been increased to SEK 800 million and expires in 2026.

Net sales, SEK million

257.6	282.9
		64.6	76.0
Industrial	Commercial Kitchen
Q1 2022	Q1 2023	Q1 2022	Q1 2023

EBITDA, SEK million

52.4	59.0
		12.5	16.3
Industrial	Commercial Kitchen
Q1 2022	Q1 2023	Q1 2022	Q1 2023

Absolent Air Care Group

005