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    AMBEA   SE0009663826

AMBEA AB (PUBL)

(AMBEA)
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Delayed Nasdaq Stockholm  -  05/23 11:29:38 am EDT
47.50 SEK   -0.71%
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Ambea : interim report_Q2_21

07/23/2021 | 01:08am EDT

We make the world a better place,

one person at a time.

Interim report January - June 2021

Clear signs of recovery

Second quarter April - June

  • Net sales rose 3 per cent to SEK 2,851 million (2,776). Ac- quired growth was 3 per cent, exchange rates had a negative impact of 1 per cent on growth, and organic growth was -1 per cent.
  • Operating profit (EBIT) totalled SEK 119 million (136).
  • EBITA declined 11 per cent to SEK 146 million (165), corre- sponding to a margin of 5.1 per cent (5.9).
  • Adjusted EBITA, which excludes items affecting compara- bility, decreased 16 per cent to SEK 146 million (174). The adjusted EBITA margin was 5.1 per cent (6.3).
  • Profit for the period totalled SEK 37 million (53).
  • Earnings per share were SEK 0.39 (0.56) before and after dilution
  • Cash conversion was 132.9 per cent (132.3).
  • Free cash flow totalled SEK 371 million (382).

First six months January - June

  • Net sales amounted to SEK 5,578 million (5,587). Acquired growth was 2 per cent, exchange rates had an impact of 0 per cent on growth, and organic growth was -2 per cent.
  • Operating profit (EBIT) totalled SEK 244 million (280).
  • EBITA declined 12 per cent to SEK 298 million (337), corre- sponding to a margin of 5.3 per cent (6.0).
  • Adjusted EBITA, which excludes items affecting compara- bility, decreased 17 per cent to SEK 298 million (360). The adjusted EBITA margin was 5.3 per cent (6.4).
  • Profit for the period was SEK 83 million (114)
  • Earnings per share were SEK 0.88 (1.21) before and after dilution
  • Cash conversion was 105.4 per cent (105.4).
  • Free cash flow totalled SEK 543 million (530).

Significant events

  • During the quarter, Ambea estimates the negative impact of the COVID-19situation to be about SEK 85 million on net sales and SEK 40 million on EBITA. The negative impact includes both a lower rate of occupancy, primarily in elderly care, and higher costs for personal protective equipment (PPE) and sick leave, as well as government support re- ceived.
  • Altiden, Ambea's Danish unit, completed the acquisition of
    EKKOfonden's care operations. The operation comprises
    166 care placements within social care for young people and adults across Denmark. Read more about the acquisition in Note 5.

Consolidated key figures

2021

2020

2021

2020

2020

SEK million

Apr-Jun

Apr-Jun

∆%

Jan-Jun

Jan-Jun

∆%

R12

Jan-Dec

Net sales

2,851

2,776

3

5,578

5,587

-0

11,074

11,083

EBITA*

146

165

-11

298

337

-12

789

829

Operating margin, EBITA (%)*

5.1

5.9

5.3

6.0

7.1

7.5

Adjusted EBITA*

146

174

-16

298

360

-17

817

879

Operating margin, adjusted EBITA (%)*

5.1

6.3

5.3

6.4

7.4

7.9

Operating profit/loss, EBIT

119

136

-12

244

280

-13

681

717

Operating margin, EBIT (%)*

4.2

4.9

4.4

5.0

6.2

6.5

Profit/loss after tax

37

53

-30

83

114

-28

328

359

Earnings/loss per share before dilution, SEK

0.39

0.56

-30

0.88

1.21

-28

3.47

3.80

Earnings/loss per share after dilution, SEK

0.39

0.56

-30

0.88

1.21

-28

3.47

3.80

Cash conversion (%)*

132.9

132.3

105.4

105.4

103.2

103.2

Free cash flow*

371

382

-3

543

530

0

1,283

1,271

* Alternative performance measures. For reconciliation of financial statements to IFRS, see Note 8, for purpose and definition, see ambea.com/investor-relations/reports-and-presentations/

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COMMENTS FROM MARK JENSEN, PRESIDENT AND CEO

Clear signs of recovery

The Scandinavian societies are opening up and an increasing proportion of the population has been vaccinated against COVID-19. We see positive signs of recovery, but the pandemic is still affecting Ambea.

Employees in Ambea's operations have now been at the frontline of the pandemic for 16 months. I want to extend my sincere thanks to all of our employees who, day after day, have worked in the best interests of our care receivers during a pandemic that has brought challenging conditions. The dedication and commitment shown are admirable.

Limited infection and positive occupancy trend in Sweden

I can say with great satisfaction that we have had a very limited number of infections and no serious cases of illness within Ambea during the past quarter. After the vaccination of the elderly, we have been able to return to more normal everyday operations - with activities, companionship and the possibility of visits from nearest and dearest. We are now seeing, month by month, a clearly positive occupancy trend in our existing units and this trend is set to continue in the third quarter.

Ambea's sales grow once again

During the second quarter, Ambea's net sales rose 2.8 per cent. New residential placements and increased occupancy, as well as acquisitions and positive currency effects are behind the positive trend, although this was offset by elderly care contracts that were handed back.

We are pleased and proud of the new units that were opened during the quarter and that strengthened our Group: After two years of construction, we opened the doors in June to Fribo Holte, slightly north of Copenhagen, Ambea's first nursing home under own management in Denmark, with 72 residential placements. In Sweden, we opened a newly built nursing home in Eskilstuna and one in Åkersberga, each with 60 placements. In Denmark, we also finalised the acquisition of EKKOfonden, with 166 residential placements in disability care and support for adults. Our plan for redirecting the Danish operation, with a focus on residential care and more profitable segments, is progressing well and we have a positive outlook for the Danish operation.

Pandemic effects still a burden on sales and earnings Despite positive signs, EBITA for the second quarter was SEK 146 million, which is 16 per cent lower than the same quarter in 2020.

One reason was various types of pandemic effects in our Norwegian Stendi division: During the second quarter of

"The pandemic has been extremely challenging for our personnel, care receivers and family members. I am pleased that we are well on our way out of it."

2020, the Norwegian government disbursed comprehensive support packages, which makes the comparative figures for the preceding year particularly challenging. During the past quarter, occupancy was lower in certain parts of Sten- di's operations. Accordingly, capacity was adapted, with the discontinuation of several units. In addition, the division was charged with significant costs related to the pandemic lockdowns, in which strict quarantine rules resulted in high sick leave figures and extra costs for temporary staff.

A M B E A A B ( P U B L ) C O R P . R E G . N O . 5 5 6 4 6 8 - 4 3 5 4 | I N T E R I M R E P O R T Q 2 2 0 2 1

2

COMMENTS FROM MARK JENSEN, PRESIDENT AND CEO

As society now opens up, we can look ahead and reinforce our efforts to develop the Norwegian operations. This will lead to new initiatives that will be launched during the au- tumn, but the effects of which will only be apparent during 2022.

In Sweden, our Vardaga elderly care unit had a stable second quarter with increased occupancy. Here, we have intensified our focus on sales and marketing to relevant target groups, including through popular webinars with Vardaga's own experts and local activities in the form of virtual or individual tours of our nursing homes. We have several residential care facilities where occupancy has returned to pre-pandemiclevels and we are now directing our attention towards other facilities.

Nytida, our disability care operation, had lower occupancy in certain segments, at the same time as comparative figures are challenging due to government grants disbursed during the second quarter of 2020. Despite the challenges created by the pandemic, our operations have been maintained in a COVID-safemanner.

In Denmark, the acquisition of EKKOfonden's operations entail positive earnings effects and the work is proceeding to discontinue our operations in the home care segment, which together with new nursing homes under own man- agement, will result in positive earnings effects in the long term.

Ambea as a promoter of skills enhancement

An important part of Ambea's operations is our endeavour to enhance skills in the industry and among our clients. In Sweden, LÄRA, our training unit, trains hundreds of employees every month in areas including care, social services and schools. Also in our other markets, Ambea contributes to skills enhancement through, for example, webinars and other training initiatives.

Ambea's role important as care needs increase

In the years to come, Ambea will undoubtedly have a very important role in ensuring that society's care provision is sufficient for everyone, since demographics are driving additional needs in our areas. These are needs that - in constructive and trustful cooperation with the municipalities in our three Nordic countries - we want to address with individually adapted and high-qualitycare.

Mark Jensen

Fribo Holte opened. During the second quarter, Altiden opened its first nursing home under own management, Fribo Holte. The facility, which has 72 care place- ments, was warmly received and the interest in moving in has been extensive.

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ABOUT AMBEA

Together we create safe and secure care for everyone

Ambea is one of the leading care providers in Scandinavia. We work with the elderly, people with disabilities and people who need psychosocial support. Our mission is to ensure quality of life for every person in Ambea's 900 units. Seeing and hearing them is the heart of our company.

But we also look up and see the world through the eyes of our clients - municipalities. Will they have enough resources in the years ahead? As the need for care grows sharply, financial pressures intensify and the shortage of care workers increases, smart solutions, partnership and innovative solutions will be crucial. Ambea has a key role to play here.

We are a company that dares to test new ideas, strives for continuous improvement and continuously develops our units and our employees. We are big enough to make a difference and want to be a role model that works together with municipalities to create as much safe and secure care as possible from every valuable tax krona.

Always in the best interests of our care receivers. Always guided by our vision: We make the world a better place, one person at a time.

Villa Stallgången opened. On Friday, 18 June, Vardaga's new residential facility in Eskilstuna was opened. Care Manager Päivi Ackesten welcomed everyone and spoke briefly about the new facility. Together with regional Manager Lisa Grön- lund, she held up the opening ribbon, which was cut by Majo Kuusikoski (Social Democratic Party), Chair of the Municipal Pensioners' Council in Eskilstuna. Katarina Fu from the developer Vectura Fastigheter also spoke. Afterwards, refreshments were served and there was the opportunity to tour the facility.

Our divisions

Sales per division

Sales per country

7% 2%

7%

32%

26%

26%

67%

Our services

33%

• Elderly care

• Disability care

Vardaga

Altiden

Sweden

• Psychosocial support

Nytida

Norway

• Qualified temporary care staff

Klara

Denmark

Stendi

26,000

12,000

900

350

employees

care receivers

units

municipalities are

our clients

A M B E A A B ( P U B L ) C O R P . R E G . N O . 5 5 6 4 6 8 - 4 3 5 4 | I N T E R I M R E P O R T Q 2 2 0 2 1

4

Nina Thoren Forsanker

SUSTAINABILITY AND QUALITY

Sustainability and quality management in the second quarter

Lessons from COVID-19

The Coronavirus pandemic has particularly affected the very oldest in society and this was no different in Ambea's nursing homes. It is important that we learn from the past year to develop care services. During the quarter, Ambea has focused a great deal on identifying the driving forces of infection spread and factors that counteracted it. We have also intensified ongoing initiatives aimed at developing the operations. These include the build-up of continuous crisis preparedness, intensified efforts to promote recruitment and further training of nurses, and a language certificate to boost the knowledge of Swed- ish for those employees who need it.

For the future, we are examining the conditions to develop basic care training to ensure a higher level of skills among all employees who meet care re- ceivers. We will also make greater use of digital opportunities that simplify the work of our employees.

Fifth anniversary for Jobs and integration at Ambea

The large wave of immigration to Sweden began in autumn 2015. Ambea began offering employment and work placements to newly arrived residents already in the spring of 2016. Since then, 1,200 newly arrived residents have participated in various types of initiatives. The aim is to find valuable employees for our units, while also promoting social integration.

"I am hugely proud and pleased. The results are positive, an esti-

mated 50 per cent of those who have joined Ambea over the past two years have either continued to work at the company or are studying to become a care worker. This strengthens us in our continued work," says Nina Thoren Forsank- er, Skills and Diversity Strategist at Ambea.

"I am also very proud of our innovative approach. There is an

enormous and growing recruitment need within care services. We must think differently to attract and recruit the best employees and provide the best social care for care receivers."

Reports and quality inspections during the quarter

SWEDEN

IVO inspections: 26 inspections were carried out by IVO, all within Nytida. Decisions were issued for 11; no decision contained criticism from IVO.

Lex Sarah cases: Two cases were reported, both in Nytida. Decisions were issued for both reports and IVO closed these without any remarks.

Lex Maria cases: Five cases were reported, one within Vardaga and four within Nytida. One decision was issued for one of the reports in Nytida and IVO closed it without any remarks.

Individual complaints: Three individual complaints were investigated by IVO, one within Vardaga and two within Nytida; no decisions have yet been issued in any of these cases.

NORWAY

Regulatory inspections: 36 units, 35 of them child units, were inspected by the authorities during Q2. Of these, five resulted in requirements for action.

DENMARK

Regulatory inspections: Nine inspections were conducted within Altiden during the quarter. Four of these resulted in requirements for action and these will be addressed prior to any follow-up inspection.

A M B E A A B ( P U B L ) C O R P . R E G . N O . 5 5 6 4 6 8 - 4 3 5 4 | I N T E R I M R E P O R T Q 2 2 0 2 1

5

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Disclaimer

Ambea AB published this content on 23 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 July 2021 05:07:11 UTC.


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Financials
Sales 2022 12 414 M 1 264 M 1 264 M
Net income 2022 463 M 47,1 M 47,1 M
Net Debt 2022 10 023 M 1 020 M 1 020 M
P/E ratio 2022 9,70x
Yield 2022 3,10%
Capitalization 4 490 M 457 M 457 M
EV / Sales 2022 1,17x
EV / Sales 2023 1,10x
Nbr of Employees 26 000
Free-Float 70,2%
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Managers and Directors
Mark Jensen President & Chief Executive Officer
Benno Eliasson Chief Financial Officer
Yrj÷ Pekka Tapio Nńrhinen Chairman
Gunilla Rudebjer Independent Director
Patricia Brice˝o Rodriguez Director