Coor Service Management : Annual and ESG Report 2023

Coor creates the best workplace environments in the Nordics

ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

COOR SERVICE MANAGEMENT HOLDING AB

Contents
Introduction
This is Coor	0
Highlights of the year	2
CEO's review	6
This is Coor
Coor creates the best workplace environments
in the Nordics	10
Collaboration with the customer	12
A leader in IFM	14
Coor in the Nordic region	15
Interview with Coor's CFO	16
Invest in Coor	17
Outlook and strategy
We create value	18
Value chain	19
Global trends	20
Coor's navigator	22
Strategic areas	24
Targets and results	26
Responsible business
Focus on sustainability	28
Innovation	32
Our business	34
Employees and diversity	39
Meet our employees	42
Operations
Coor's customers	46
Meet our customers	47
Corporate Governance Report
Corporate Governance Report	52
Governance and control	53
Auditor's opinion	65
Presentation of the Board of Directors	66
Presentation of management	68
Statutory annual report
Directors' Report	71
Proposed appropriation of retained earnings	81
Risks and risk management	82
Consolidated financial statements	84
Notes to the consolidated financial statements	88
Parent company financial statements	116
Notes to the parent company financial statements	120
Declaration of the Board of Directors	123
Auditor's Report	124
Sustainability notes
Sustainability across the value chain	128
Auditor's opinion	150
GRI index 2023	151
Other
Five-year summary	155
Selected key performance indicators	156
Definitions	158
Share information	159
Specific shareholder information	161

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

Our vision

Coor creates the happiest, healthiest and most prosperous workplace environments in the Nordic region. We strive tirelessly to build the teams and full-service solutions that enable our customers to do what they do best.

Who are we

We always put people at the centre. Coor consists of 13,000 employees who work across the Nordic region and in Belgium. We offer around a hundred services in a variety of service areas, the largest of which are cleaning, property services, workplace services, and food and beverages.

Our driving forces

Sustainability inspires everything we do and our driving forces are: satisfied customers, engaged employees, increased inclusion and a reduced carbon footprint. Through innovative approaches and partnerships with customers, suppliers and start-ups, we work tirelessly to find new solutions. With the right equipment and innovative technology, we create safe, secure and prosperous workplaces for our customers as well as our own employees.

How we create value

With a passion for service and a focus on continuous improvement, we create value by implementing, leading and streamlining the delivery of services in our customers' premises. We also help our customers to achieve their sustainability goals, both by reducing their climate impact and by creating a better work environment for their employees. But we create the greatest value for our customers by taking over responsibility for all services in and around the workplace so that they can concentrate on their core business.

»We create value

for our customers with our

passion for service.«

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

2 Introduction | Highlights of the year

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

Introduction | Highlights of the year 3

A year of growth and focused environmental efforts

Annual net sales

SEK million
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
2019	2020	2021	2022	2023

Net sales by	Net sales by type of
country	contract

Sweden 53%	Integrated FM (IFM) 57%
Denmark 24%	FM services 43%
Norway 17%
Finland 6%

Annual operating profit and margin

SEK million				%
700				7
600				6
500				5
400				4
300				3
200				2
100				1
0				0
2019	2020	2021	2022	2023
	Adjusted EBITA, SEK million		Margin, %

Key performance indicators	2023	2022
Net sales, SEK million	12,443	11,789
Organic growth, %	2	5
Acquired growth, %	2	9
FX effects, %	1	3
Adjusted EBITA, SEK million	606	634
Adjusted EBITA margin, %	4.9	5.4
EBIT, SEK million	364	408
Profit after tax, SEK million	155	257
Cash conversion, %	86	94
Earnings per share, SEK	1.6	2.7
Number of employees (FTE) at year-end	10,648	10,267
Dividend per share, SEK	3.00 1)	4.80

1. The dividend is subject to approval by the Annual General Meeting on 26 April 2024.

Customer Satisfaction Index	Employee Motivation Index	Gender distribution	Percentage of suppliers with
		managers	validated SBTi targets
71	76	53/47	18%

2023 (71)	2023 (76)	Women: 53% (50%)
2022 (71)	2022 (76)	Men: 47% (50%)

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

4 Introduction | Highlights of the year

An eventful year

2023

The year was dominated by new and extended contracts, margin improvement measures and a strong focus on sustainability and innovation.

JANUARY

Sustainability-linked refinancing

Coor signs an agreement on sustainability -linked refinancing of its existing revolving credit facility. The sustainability-linked refinancing reflects Coor's commitment to environmental and social responsibil- ity. The margin is linked to the achievement of environmental targets related to CO2e emissions (Scopes 1 & 2 and Scope 3), which supports Coor's goal of achieving net zero emissions, and social targets related to the company's total recorded injury frequency (TRIF) rate, which is part of the company's vision of zero work-­ related injuries.

FEBRUARY

Committing to Net Zero by 2040

Coor has committed to reaching net zero greenhouse gas emissions by 2040. This is ten years earlier than required for signatories of the Science Based Targets initiative (SBTi).

"It feels fantastic that Coor is setting a goal that it is aiming to reach ten years before the date set by the official standard. It is also further testimony to the fact that our sustainability strategy fully supports our vision to become a truly sustainable company," says AnnaCarin Grandin, President and CEO of Coor.

APRIL

Among the best in Sweden for gender equality Coor comes second in the 2023 SHE Index powered by EY ranking and thus maintains a place on the podium as one of Sweden's most gender -equalcompanies. SHE Index powered by EY is a tool for assessing companies and helping them to promote gender equality. Companies participate by answering questions in six different categories on the basis of which an individ-

ual index is calculated. The index also evaluates the companies' active efforts to promote diversity and inclusion. In the 2023 survey, Coor received a score of 93 out of a possible 100.

APRIL

Coor acquires Skaraborgs Städ Coor signs an agreement to acquire Skaraborgs Städ, which offers workplace FM services with a primary focus on cleaning to a large number of customers in Västra Götaland, Småland and Värmland. The acquisition expands Coor's geographical coverage in Sweden. Skaraborgs Städ has 800 employees and annual sales of around SEK 400 million. The purchase price (on a cash and debt-freebasis) is SEK 250 million. The acquisition is financed entirely through Coor's existing financing framework. Skaraborgs Städ includes the subsidiaries Städtjänst Värmland, Kristinehamns All Rent and Sanmix.

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

AUGUST

Coor signs IFM contract with Swedbank Coor signs an integrated facility management contract with Swedbank. The contract runs for four years with an option to extend and is worth around SEK 220 million annually, including estimates for annual variable project volumes. Coor will deliver a broad range of integrated services including cleaning, technical service, administrative services, coffee, fruit, plants and caretaking at all Swedbank offices in Sweden. The contract runs from 15 December 2023.

Introduction | Highlights of the year 5

SEPTEMBER

Extended contract with Aibel

Aibel AS is a leading Norwegian service company that specialises in oil, gas and renewable energy. Since 2014, Coor has been delivering and developing integrated FM services at five of Aibel's sites in Norway. Coor's contract with Aibel is now being extended for five years, until 2029. The contract is worth around SEK 200 million over the contract term, not including additional variable project vol- umes. The contract covers services such as cleaning, reception, restaurant and property management services.

JUNE

Jenny Lindgren joins executive management

Jenny Lindgren will take over as Senior Vice President Operational Development and Digitalisation on 1 September 2023 and will join Coor's executive management team. Before joining Coor, Jenny Lindgren was Head of Transformation & Planning B2B at Telia Company. She also has extensive experience from various roles in the IT industry with Cygate, Tietoevry as well as other companies.

MAY

Simply by Coor makes life simpler Simply by Coor is our new digital platform that makes working life easier for our service users, i.e. the employees of Coor's customers. Through Simply by Coor, they can access all the workplace services they need during their working week, such as news, lunch menus, meeting food, mail, concierge services and event information. Simply by Coor is fully integrated with Coor's service delivery, and functions as well as content can be tailored to each individual workplace. The new platform also enables integrations with customers' or third-partyproviders' case management systems, such as room booking and other systems, all with the aim of making the working lives of the service users as easy as possible.

OCTOBER

Coor launches action programme for margin improvement

In its third-quarter interim report, Coor presented an action programme aimed at accelerating progress towards achieving the company's target margins. The action programme includes extended cost control, downsizing through increased harmonisation and industrialisation of underlying processes with a focus on cleaning, property management and food and beverages. There is also an increased focus on purchasing to take greater advantage of Nordic economies of scale. Once fully implemented, the action programme is expected to have an annual effect of around SEK 100 million. Costs for the programme are estimated at SEK 40 million, most of which will be recognised in the fourth quarter, when the layoffs are implemented.

Net zero 2040 target validated

Coor is aiming to achieve net zero greenhouse gas emissions no later than 2040. The Science Based Targets initiative (SBTi) has now reviewed our plan and validated that it is consistent with what is required to achieve the research-based target. To achieve the target ten years earlier than required by the standard, we have identified three key areas for our transition: emissions from Coor's own operations, a shift to more sustainable menus in our restaurants and a more circular flow, both in business models and from suppliers.

NOVEMBER

Coor in Sweden strengthens and consolidates its offering in security

By merging Addici Security, with 700 employed security guards, and its Security business area, with around 100 specialists in technical security services, Coor creates Addici Security & Technology. The purpose is to enable Coor to meet changed customer requirements resulting from the escalated security situation in Sweden.

"We are offering the market an even broader portfolio of security and peace-of-mind services. Through a long-term approach, transparency and intelligence, we create cost-effective solutions that balance risk, damage prevention and damage mitigation measures," says Andreas Glansborg, CEO of Addici Security & Technology.

Coor named Career Company

For the fourth year running, Coor has been named a Career Company. The award is given by Karriärföretagen, which every year lists employers in Sweden that offer unique career and development opportunities for young talented employees. In naming Coor a Career Company, Karriärföretagen stated: "Through its commitment to the development and well-being of its employees, Coor creates a corporate culture that promotes collaboration, diversity and personal growth. This employer not only offers opportunities for an exciting career, but also the opportunity to be part of a workplace where innovation and well-being are at the centre."

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

6 Introduction | CEO's review

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

Introduction | CEO's review 7

A year of growth, accelerated sustainability efforts and innovations

It is time to look back on a year in which Coor won many new deals while maintaining continued high variable volumes, stepped up its sustainability efforts and where the demand for innovative solutions accelerated.

Every winter, between the run-up to Christmas and the New Year celebra- tions, I usually spend time reflecting on the past year. When I look back at 2023, I do so with great pride and joy at Coor's fantastic employees and at how much we have achieved together.

In recent years, we in the Nordic region have faced a more challenging world. Unfortunately, 2023 was no exception, with a declining economy and rising inflation, as well as continued war in our neighbouring Ukraine and a war in Israel and Gaza. My heart goes out to all the people in the world's conflict zones who are suffering in some way. At Coor we have always been ready to adjust, whatever the economic situation or state of the world. This proved a great strength in 2023.

Many small and medium-sized deals It has been a very good year in terms of both new sales and growth in project volumes. I am very proud to note that the year was our third best ever in terms of new sales. We won major new contracts with companies such as Swedbank and Locum in Sweden and

ATP Ejendomme and Clever in

­Denmark, but above all it was a successful year in terms of new small and medium-sized contracts. When the books were closed, our business had grown despite the loss of a major contract during the year. In May, we acquired Skaraborgs Städ, which is now being integrated with Coor. The acquisition further expands our geographical coverage in Sweden.

Strong customer relations is another Coor hallmark. We have a strong pool of expertise in the company, which we deploy to constantly improve our deliveries. During the year, we deepened our partnerships with many of our customers. One example is Aibel in Norway, where Coor's broad service offering and expertise are being put to full use in an integrated facility management delivery which in 2023 was extended for another five years.

We have also strengthened our customer offering in security. During the year, Coor in Sweden merged two businesses. The merger of Addici Security, with 700 security guards, and Coor's security business area with 100

specialists in technical security services, gives us an even broader portfolio of security and peace-of-mind solutions. It enables us to respond to changing customer requirements arising from an escalated security situation.

Our employees - our most important asset

Happy employees make for happy customers. At Coor, we have fantastic employees who go to work every day with the goal of creating the very best experience for the customer and the customer's employees. Our employees are our most important asset; without them we would be nothing. We see this not least during our annual Coor Awards ceremony, where employees are honoured for their achievements and commitment. The number of nominations for the Coor Awards continues to grow every year. In 2023, nearly one in ten employees were nominated in some category. This is an incredible testimony to our employees' passion for service and people.

We have also had a strong focus on work environment and safety and it is

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023

8 Introduction | CEO's review

very gratifying to see that our safety culture has been further strengthened and that the number of work-related injuries has decreased. Our goal is, of course, that no employee should be injured in the workplace. A country that has significantly reduced the number of work-related injuries during the year is Finland.

In the autumn, Coor in Sweden was named one of the country's top Career Companies for the fourth year running, which shows that we also have a strong brand as an employer. This is a great asset when we seek to attract the best talent in the market to new roles, but it also means that our employees stay for a long time at Coor, where they have great opportunities to develop in their current or new roles. We recruit from a broad base and have employees with many different nationalities and cultural

backgrounds. Numerous studies have shown that having people with different viewpoints and backgrounds represented in a team increases its ability to make the best decisions and find effective solutions. It is very clear to me that different perspectives and experiences strengthen Coor.

Sustainability and innovation go hand in hand

During the year, we further accelerated our sustainability efforts. We are committed to achieving the target of net zero emissions by 2040, ten years earlier than required for signatories of the Science Based Targets initiative (SBTi). In October, we became the first Swedish facility management company to have our targets validated by a third party. In order to reach our targets, we have taken initiatives such as gradually

transitioning our vehicle fleet to electric vehicles, using electricity from non-fossil fuel sources and choosing suppliers whose climate goals are as ambitious as ours. Our ambitious sustainability targets will demand a lot, not only from us but also from our customers and suppliers, but we are confident that this work will future-proof Coor as a company, among our customers, employees and investors.

For a number of years now, Coor has also been a signatory to the UN Global Compact whose work is based on its Ten Principles, formulated on the basis of international conventions on human rights, labour, environment and anti-­ corruption. Our participation in the UN Global Compact is of course ongoing.

I like to say that innovation is part of Coor's DNA. Our ability to innovate enables us to deliver solutions to our

Share of renewable energy in our premises

77%

TRIF (total recorded injury frequency) rate

14
12
10
8
6
4
2
0	2020	2021	2022	2023
2019

Committed and motivated employees

%
100
80
60
40
20
0	2020	2021	2022	2023
2019

COOR | ANNUAL REPORT AND SUSTAINABILITY REPORT 2023