Duroc : INTERIM REPORT JULY 2023 – MARCH 2024

INTERIM REPORT

JULY 2023 - MARCH 2024

STRONG FINANCES AND LOW NET DEBT - CONTINUED VOLATILITY IN THE POLYMER COMPANIES

Third quarter January 2024 - March 2024

• Net sales fell by 18 percent to MSEK 780.2 (947.2). Organic growth** was -10 percent.
• Adjusted EBITDA* decreased by 29 percent to total MSEK 42.0 (59.4), equivalent to an adjusted EBITDA* margin of 5.4 percent (6.3).
• Adjusted EBIT* decreased to MSEK 19.9 (32.2).
• Operating profit (EBIT) totaled MSEK 22.2 (30.5).
• Cash flow from operating activities totaled MSEK -13.4 (44.2).
• Earnings after tax totaled MSEK 7.4 (11.6).
• Adjusted earnings* per share totaled SEK 0.05 (0.34).
• Earnings per share totaled SEK 0.10 (0.30).
• Equity totaled MSEK 1,142.3 (1,071.5) and the equity/assets ratio was 62 percent (57).
• The transaction with LKAB regarding the sale of 49 percent of the shares in Duroc Rail AB was concluded during the quarter. The final cash consideration was MSEK 79.2 and and resulted in an increase in the group's equity by MSEK 64.2 The deal also stipulates that LKAB will build a new production facility for Rail which will give space/room for continued growth to meet the industrial expansion in northern Sweden.

July 2023 - March 2024

• Net sales fell by 15 percent to MSEK 2,276.3 (2,686.4). Organic growth** for the remaining operations was -9 percent.
• Adjusted EBITDA* increased by 8 percent to total MSEK 90.0 (83.3), equivalent to an adjusted EBITDA* margin of 4.0 percent (3.1).
• Adjusted EBIT* increased to MSEK 16.3 (-0.6).
• Operating profit (EBIT) totaled MSEK 18.4 (-202.5).
• Cash flow from operating activities totaled MSEK 12.4 (171.4).
• Earnings after tax totaled MSEK 6.5 (-210.1).
• Adjusted earnings* per share totaled SEK 0.03 (-0.21).
• Earnings per share totaled SEK 0.08 (-5.39).
• As of March 31, 2024, cash and cash equivalents totaled MSEK
• 1. (26.2), and net debt excluding lease liabilities from IFRS 16 totaled MSEK 76.3 (124.2), a reduction by MSEK 43.2 since December 31, 2023. Unutilized credit facilities totaled MSEK
  1. (267.0).

	2023/2024	2022/2023	2023/2024	2022/2023	2023/2024	2022/2023
Group (MSEK)	Q3	Q3	Q1-Q3	Q1-Q3	R12 MAR	JUL-JUN
Net sales	780.2	947.2	2,276.3	2,686.4	3,083.0	3,493.1
EBITDA	44.3	57.7	92.0	60.8	135.2	104.0
Adjusted EBITDA*	42.0	59.4	90.0	83.3	120.6	114.0
Adjusted EBITDA*-margin, %	5.4	6.3	4.0	3.1	3.9	3.3
Operating profit/loss (EBIT)	22.2	30.5	18.4	-202.5	33.2	-187.6
Adjusted EBIT*	19.9	32.2	16.3	-0.6	21.5	4.6
Profit/loss after tax	7.4	11.6	6.5	-210.1	-21.5	-238.1
Profit per share, SEK	0.10	0.30	0.08	-5.39	-0.64	-6.10
Adjusted profit* per share, SEK	0.05	0.34	0.03	-0.21	-0.94	-1.17
Cashflow from operating activities	-13.4	44.2	12.4	171.4	58.2	217.2
Net debt excl. lease liability from IFRS 16	76.3	124.2	76.3	124.2	76.3	115.0
Net debt incl. lease liability from IFRS 16	189.8	258.4	189.8	258.4	189.8	251.1
Net debt/Equity ratio, %	17	24	17	24	17	23

*Adjusted for items affecting comparability. A reconciliation of amounts can be found on page 22.

**Refers to growth adjusted for exchange rate fluctuations and structural changes such as the acquisition and disposal of companies.

Duroc acquires, develops and manages companies with a focus on trade and industry. Using their profound knowledge of technology and markets, the Group's companies aim to achieve leading positions in their respective industries. As the owner, Duroc actively contributes to their development. Duroc is listed on Nasdaq Stockholm (short name: DURC). www.duroc.se

D UR OC IN T E RIM RE P OR T Q 3 2 0 2 3 /2 02 4

2 ( 2 4 )

CEO'S COMMENT

Parts of the group such as railway maintenance, coated textiles and industrial motors developed positively. The quarter was affected negatively by continued volatile and subdued demand in the polymer companies, a lack of major projects in the cultivation industry and delays in the deliveries of sold machine tools in the DMT Group. The previously announced transaction with Rail was concluded in February.

Third quarter January 2024 - March 2024

Net sales decreased by 18 percent to MSEK 780.2. The adjusted EBIT totaled MSEK 19.9.

Railroad maintenance enjoyed strong demand during the quarter, with record sales and earnings noted during the last month. The transaction in which LKAB acquires 49 percent of Duroc Rail and finances the construction of the new workshop was concluded in February according to plan. This strategic partnership with LKAB, including their financing of the new production facility in Luleå, enables a significant expansion of Rails operation in the coming years. The cost for a new production facility is of a magnitude that Duroc saw an importance in bringing Rails largest customer as an investor in the business. The sale of 49 percent of the company released about MSEK 80 in cash for Duroc.

Plastibert, with coated textiles, or synthetic leather, saw an upward trend during the quarter, with improvements in both sales and earnings. The company has succeeded in increasing its customer base and has also implemented new technology in production with the aim of eliminating hazardous solvent emissions.

The order intake for DMT has been good and the order stock amounted to about MSEK 200 at the end of the quarter. Delays from suppliers and the industrial action in Finland, which delayed the deliveries of sold machines, affected the quarter negatively.

The fiber companies in Europe and the USA underwent a challenging quarter. The fiber industry in Europe is still suffering from the after-effects of the invasion of Ukraine with high interest rates and energy prices, even though both of these factors are abating. Demand has in recent years been significantly lower in most segments.

The furniture industry in the USA is currently in a severely trying period. A reduction in sales of around 20 percent was noted by American furniture manufacturers compared to 2023. The consumption of furniture is strongly linked to sales in the housing market, which currently has stagnated due to the high interest rates. The furniture industry is the primary customer group for the American fiber unit, Drake Extrusion. However, during the last quarter, volumes recovered at Drake.

A cost-saving program is in place but is not sufficient to compensate for the lost volume that took place in the fiber units. Reported capacity utilization in the industry in March was just over 60 percent in North America and just below 70 percent in Europe.

The cultivation industry is still characterized by lower volumes linked to interest rates and raw materials prices, where the number of major greenhouse projects was significantly fewer than in recent years. This had a severely negative effect on Cresco's sales, which were lower compared to the previous year.

First nine months July 2023 - March 2024

Net sales decreased by 15 percent to MSEK 2,276.3. The adjusted EBIT totaled MSEK 16.3. The financial year has been characterized by setbacks in the fiber and cultivation industries. These industries constitute a significant part of Duroc and have as such a great impact on consolidated earnings for the Group. Other companies developed well even if there was a slowdown in sales in most companies in the Group. The DMT Group has built up a significant order stock, and even though investment decisions are taking longer than before, the company is enjoying good demand for the Group's products and services. A new facility was inaugurated for the operation in Latvia.

In the Smaller Company Portfolio, UPN (engine supplier to machine builders) stands out as a well-performing, stable operation with good demand for its products and services. Furthermore, DLC's efforts in widening the customer base have started to yield results, with new customers and a positive outlook for good growth in the business.

Outlook

Uncertainty continues to prevail in the fiber industry in Europe and the United States. Inventory levels are considered normal in Europe and on the low side in North America. This does not bode well for a rapid market rally, but rather a slow decline in this cyclical business. Recovery in the industry is dependent on price developments for raw materials and also interest rates. If we see a continued easing of these aspects combined with lower inflation, there will once again be growing potential.

Furthermore, I note a certain softening in the mechanical engineering industry, which affects DMT. Conditions for customers are largely dependent on the industry they operate in. The defense industry is currently working at full tilt and even though the heavy haulage sector has slackened, volumes are still considered to be at a good level.

Duroc remains in good financial condition; it is largely debt-free and with significant room for investments in both existing and new operations. We will maintain the conservative approach that has enabled us to ride out the extraordinary storm that has befallen the fiber-related companies.

John Häger

CEO

D UR OC IN T E RIM RE P OR T Q 3 2 0 2 3 /2 02 4

3 ( 2 4 )

DEVELOPMENTS IN DUROC PORTFOLIO COMPANIES

Duroc's portfolio companies consist of International Fibres Group (IFG), Drake Extrusion, Cresco, Plastibert, Duroc Machine Tool (DMT), Duroc Rail and Smaller Company Portfolio (SCP), which comprises Universal Power Nordic (UPN), Herber and Duroc Laser Coating (DLC). Set forth below are each individual portfolio company's share of net sales and adjusted EBIT for the past 12-month period, April 2023 - March 2024. Read more about developments company-by-company on pages 4-10 and in Duroc's segment report on page 21.

SHARE OF NET SALES (R12) PROFORMA*

Duroc Rail	Smaller
6%	Comp Portf
	6%
DMT Group	IFG
35%
18%
Plastibert
6%
Cresco	Drake
9%	Extrusion
	20%

*Proportion of net sales and adjusted EBIT per portfolio company.

ADJUSTED EBIT PER PORTFOLIO COMPANY (R12) PROFORMA*

50
40
30
20
10
0
IFG	Drake	Cresco Plastibert DMT Group Duroc Rail Smaller
- 10		Extrusion	Comp Portf
- 20
- 30

Third quarter January 2024 - March 2024

• Net sales decreased by 18 percent to MSEK 780.2 (947.2). Organic growth stood at -10 percent. This was mainly due to price mechanisms in agreements in the polymer-related companies, where lower purchase prices led to lower customer sales prices.
• Adjusted EBITDA totaled MSEK 42.0 (59.4) and the adjusted EBITDA margin totaled 5.4 percent (6.3). The comparison quarter's adjusted EBITDA was burdened by the loss of MSEK -
• 1. from Griffine.
• Plastibert and Rail reported a higher adjusted EBITDA than in the previous year. Other portfolio companies provided lower EBITDA earnings than the comparison quarter.
  Adjusted EBIT totaled MSEK 19.9 (32.2) and EBIT totaled MSEK
• 1. (30.5).
• Earnings after tax totaled MSEK 7.4 (11.6).

July 2023 - March 2024

• Net sales decreased by 15 percent to MSEK 2,276.3 (2,686.4). Organic growth stood at -9 percent.
• Adjusted EBITDA totaled MSEK 90.0 (83.3) and the adjusted EBITDA margin totaled 4.0 percent (3.1); the comparison period's adjusted EBITDA included earnings from Griffine where a negative EBITDA of MSEK -8.0 burdened earnings.
• All Group companies except Cresco, DMT and Smaller Company Portfolio showed a higher adjusted EBITDA than the comparison period.
  Adjusted EBIT totaled MSEK 16.3 (-0.6) and EBIT totaled MSEK 18.4 (-202.5).
• Earnings after tax totaled MSEK 6.5 (-210.1).

DEVELOPMENT OF DUROC'S NET SALES PROFORMA** PER QUARTER / ROLLING 12 MONTHS

MSEK
1,000											4,000
900											3,500
800											3,000
700
600											2,500
500											2,000
400											1,500
300											1,000
200
100											500
0											0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

DEVELOPMENT OF DUROC'S OPERATING PROFIT/LOSS (EBIT) PROFORMA** PER QUARTER / ROLLING 12 MONTHS

MSEK
100												200
50												100
0												0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
- 502020/2021	2021/2022			2022/2023		2023/2024	- 100
- 100												- 200
- 150												- 300
- 200												- 400

**Duroc Group development excluding Griffine Enduction S.A.

**Q2 2022/2023 was affected by a Group-related impairment of assets totaling MSEK 179.3 related to Griffine Enduction S.A.

D UR O C IN T E RIM RE P O R T Q 3 2 02 3 / 20 2 4

Duroc Machine Tool (DMT) is one of the biggest suppliers of machine tools, tools, machine service and support to mechanical engineering companies in the Nordics and Baltics. Its customers can be found in e.g. forestry, the automotive industry, construction machinery and power generation. Its most important products are processing machines from DN Solutions, one of the market's world leading brands. The DMT Group represents more than 60 internationally renowned brands and is alone in its activity in seven markets: Sweden, Norway, Denmark, Finland, Estonia, Latvia, and Lithuania.

4 ( 2 4 )

Share of Duroc's sales (R12)

18%

• Net sales totaled MSEK 113.7 (157.7), a reduction of 28 percent. Organic growth was -28 percent, largely due to a strike in Finland and delivery delays where revenues were deferred until the next quarter. DMT noted a lower order intake as the interest rate situation affected willingness to invest, primarily in Sweden and the Baltics.
• EBITDA totaled MSEK 4.1 (13.9) and the EBITDA margin 4 percent (12), mainly due to investments in an increased labor force and increased marketing expenses as part of the growth strategy.
• Thanks to competitive products and a good service offering, DMT succeeded in taking market share during the year. Underlying demand throughout the region continued to be strong, but the macroeconomic situation meant that the investment decision process among customers was longer than before.
• At the end of the quarter, order levels were around MSEK 200, and on par with the previous quarter excluding the delivery delays, whose revenues are expected in April.

Net sales per quarter / rolling 12 months

MSEK
200											800
180											700
160											600
140
120											500
100											400
80											300
60											200
40
20											100
0											0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3Q1-Q3	R12 MAR
Net Sales	113.7	157.7	412.0	443.3	568.2
Growth, Net Sales %	-27.9	19.9	-7.1	24.5	-9.1
Organic growth %	-27.8	15.1	-10.0	19.6	-12.7
EBITDA	4.1	13.9	31.3	38.6	44.1
EBITDA margin %	3.6	8.8	7.6	8.7	7.8
EBIT	2.9	12.3	26.1	33.9	37.2
EBIT margin %	2.5	7.8	6.3	7.7	6.5
Net Debt/Net Cash (-)	-13.3	-41.4	-13.3	-41.4	-13.3
excl. lease liability from
IFRS16	-21.7	-49.2	-21.7	-49.2	-21.7
Capital employed	98.5	72.8	98.5	72.8	98.5
ROCE %	43.9	117.4	43.9	117.4	43.9

Adjusted EBIT per quarter / rolling 12 months

MSEK
20											60
18											50
16
14											40
12
10											30
8											20
6
4											10
2
0											0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

D UR OC IN T E RIM RE P OR T Q 3 2 0 2 3 /2 02 4

Duroc Rail delivers complete, efficient, high- quality maintenance for railroad wheels for locomotives, railroad passenger cars and freight cars. Duroc possesses unique skills for locomotive wheel maintenance, which forms an important part of a greater system in which Rail enables efficient, predictable haulage along critical infrastructure systems such as the Iron Ore Line (Malmbanan). Rail has its operation in Luleå.

5 ( 2 4 )

Share of Duroc's sales (R12)

6%

• Duroc Rail noted continued high order volume during the seasonally strongest quarter. Sales were 7 percent higher than the previous year.
• EBIT totaled MSEK 20.2 (17.0) and the EBIT margin was 34 percent (31).
• During the quarter, Rail enjoyed a historically high production rate and demand for railroad wheel maintenance continued to increase. Rail foresees continued good capacity utilization as it enters a less intensive quarter.
• The sale of a minority holding to LKAB was concluded during the quarter, and Rail continued its project with LKAB for the new production facility at Hertsöfältet in Luleå, which LKAB will construct for Rail. It is scheduled for completion at the end of 2025 and will mean that Rail will have the capacity to meet an increased demand for wheel maintenance in the region.
• The increased production rate involved an increase in capital employed, affecting cash flow negatively.

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3	Q1-Q3	R12 MAR
Net Sales	58.8	55.0	142.9	118.5	177.6
Growth, Net Sales %	6.9	10.7	20.6	13.0	20.3
Organic growth %	6.9	10.7	20.6	13.0	20.3
EBITDA	21.5	18.9	43.6	32.4	50.8
EBITDA margin %	36.6	34.3	30.5	27.3	28.6
EBIT	20.2	17.0	37.8	26.5	39.9
EBIT margin %	34.3	30.8	26.4	22.4	22.5
Adjusted EBIT	17.8	17.0	37.6	26.5	42.6
Adjusted EBIT margin %	30.3	30.8	26.3	22.4	24.0
Net Debt/Net Cash (-)	20.8	10.4	20.8	10.4	20.8
excl. lease liability from
IFRS16	18.9	1.9	18.9	1.9	18.9
Capital employed	61.9	48.1	61.9	48.1	61.9
ROCE %	87.7	65.0	87.7	65.0	87.7
Adjusted ROCE %	93.6	65.0	93.6	65.0	93.6

Net sales per quarter / rolling 12 months

MSEK 60

50
40
30
20
10
0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

Adjusted EBIT per quarter / rolling 12 months

MSEK

18020

16018

14016

12014

10012

8010

608

406

204

0

2

0

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2020/2021

2021/2022

2022/2023

2023/2024

60

50

40

30

20

10

0

D UR O C IN T E RIM RE P O R T Q 3 2 02 3 / 20 2 4

Smaller Company Portfolio (SCP)

Universal Power Nordic (UPN) supplies diesel engines for industrial and marine applications in Sweden and Norway, along with associated spare parts, service and repairs. The company represents well-known brands such as Perkins, Kubota and Kohler.

Herber Engineering manufactures advanced bending machines for cold tube forming and profiles. It has customers worldwide in e.g. the automotive, aviation, furniture and HVAC industries.

Duroc Laser Coating (DLC) is Sweden's leading laser surface treatment company. DLC offers the renovation and new manufacture of industrial components.

6 ( 2 4 )

Share of Duroc's sales (R12)

6%

• Net sales for Smaller Company Portfolio totaled MSEK 38.5 (47.7) during the quarter, a decrease of 19 percent year-over- year.
• EBIT totaled MSEK 2.2 (2.0), corresponding to an EBIT margin of 6 percent (4).
• UPN noted reduced sales of around 18 percent, mainly due to lower sales of engines. Spare parts sales increased, which had a positive impact on gross margin. Personnel costs increased as part of the company's growth strategy. The operating profit totaled MSEK 2.9 (3.0). The EBIT margin was 12 percent (10).
• Herber's net sales decreased by 40 percent to MSEK 7.0 (11.6) due to low delivery levels in respect of machines. Herber saw an increase in order intake during the quarter, which will improve sales in the quarters ahead. The company's previously established cost-cutting initiative had a certain impact during the quarter. EBIT totaled MSEK -1.3(-1.4). Delivery times for critical components were reduced considerably, which will improve production planning and thus liquidity.

• In DLC the effort on widening the customer base has yielded results. Net sales icnreased by 12 percent to MSEK 7.3 (6.5). Order levels continued to grow during the quarter. The workforce was increased by two employees, which affected EBIT which amounted to MSEK

0.6 (0.4) and an EBIT margin of 8 percent (7).

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3Q1-Q3	R12 MAR
Net Sales	38.5	47.7	121.3	143.1	172.0
Growth, Net Sales %	-19.3	20.0	-15.2	22.0	-10.5
Organic growth %	-19.3	20.0	-15.2	22.0	-10.5
EBITDA	3.6	5.0	8.1	16.6	14.7
EBITDA margin %	9.4	10.4	6.7	11.6	8.6
EBIT	2.2	2.0	1.5	8.9	5.5
EBIT margin %	5.6	4.1	1.2	6.2	3.2
Net Debt/Net Cash (-)	32.5	34.8	32.5	34.8	32.5
excl. lease liability from
IFRS16	13.3	8.2	13.3	8.2	13.3
Capital employed	59.6	64.0	59.6	64.0	59.6
ROCE %	8.9	23.6	8.9	23.6	8.9

Net sales per quarter / rolling 12 months

MSEK

70

60

Adjusted EBIT per quarter / rolling 12 months

MSEK

2006

5

18

15

50
40
30
20
10
0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

1504

3

1002

1

500

	- 1	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
0	- 22020/2021	2021/2022			2022/2023
	- 3

Q1 Q2 Q3

2023/2024

12

9

6

3

0 -3-6-9

D UR OC IN T E RIM RE P OR T Q 3 2 0 2 3 /2 02 4

International Fibres Group (IFG) is one of Europe's leading manufacturers of polypropylene-based staple fibers, an input product

with reinforcing, insulating, separating or draining properties. The fiber is used

in the production of e.g. flooring, rugs, furniture, filters, foodstuff packaging, car interiors and nonwoven fabrics, which means a

diversified customer portfolio. IFG has production facilities in Belgium,

the United Kingdom and Austria.

7 ( 2 4 )

Share of Duroc's sales (R12)

35%

• Net sales decreased by 13 percent year-over-year. Organic growth was -15 percent*. Volumes fell by 12 percent. Flooring / floor coverings, filters and niche products increased while the remaining segments decreased.
• The mix led to a gross margin increase of 14 percent.
• EBIT totaled MSEK 4.3 (10.2). Compulsory pay rises in Belgium and Austria were partially offset by layoffs and reduced labor forces.
• Net debt excluding IFRS effects totaled MSEK 63.9 (11.3), which was a decrease of around MSEK 11 compared to the financial year's second quarter.
• IFG continued to focus on innovation and niche products, among which it offers recycled and bio-based fibers. A distinct maturity has been noted in the market recently and demand for sustainable products has increased.

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3	Q1-Q3	R12 MAR
Net Sales	290.1	334.8	775.0	896.2	1,080.2
Growth, Net Sales %	-13.3	-9.9	-13.5	-10.7	-15.4
Organic growth %	-15.3	-14.5	-18.2	-15.5	-20.7
EBITDA	12.0	17.3	1.8	1.3	13.2
EBITDA margin %	4.1	5.2	0.2	0.1	1.2
EBIT	4.3	10.2	-21.8	-19.6	-17.4
EBIT margin %	1.5	3.0	-2.8	-2.2	-1.6
Net Debt/Net Cash (-)	137.8	87.4	137.8	87.4	137.8
excl. lease liability from
IFRS16	63.9	11.3	63.9	11.3	63.9
Capital employed	467.8	446.7	467.8	446.7	467.8
ROCE %	-3.8	1.6	-3.8	1.6	-3.8

*Price mechanisms in customer agreements for polypropylene mean that sales increase as raw materials prices rise and decrease as prices fall. Because raw materials prices affect both the sales price and raw materials costs, gross profit remains unchanged, but with a certain lag.

Net sales per quarter / rolling 12 months

MSEK

400

Adjusted EBIT per quarter / rolling 12 months

MSEK

1,600 40

80

350

300

250

1,400

1,200

1,000

30

20

60

40

200
150
100
50
0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021		2021/2022			2022/2023			2023/2024

800 10

6000

400

- 10

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2020/2021

2021/2022

2022/2023

2023/2024

200

- 20

0

- 30

- 40

20

0

• 20
• 40
• 60
• 80

D UR O C IN T E RIM RE P O R T Q 3 2 02 3 / 20 2 4

Drake Extrusion is North America's leading producer of polypropylene-based colored filament yarn and staple fiber. Filament yarn is used mostly by customers who produce fabrics for the furniture industry. Staple fiber is used for production in a variety of areas including flooring, rugs, furniture, technical filters, car interiors and nonwoven fabrics. The business is located in Virginia, USA.

8 ( 2 4 )

Share of Duroc's sales (R12)

20%

• Net sales increased by 13 percent compared to the year-over- year quarter, and organic growth was 13 percent due to increased sales volumes.
• Sales volumes for staple fibers increased by 20 percent. Filament yarn increased by 267 percent compared to the record low sales in the year-over-year quarter.
• The mix, together with raw materials costs, led to a 10 percent reduction in the gross profit margin.
• Adjusted EBIT totaled MSEK 2.1 (4.3), mainly due to increased energy and personnel costs related to the increased production volume.
• Net debt excluding IFRS fell somewhat, mainly due to increased operating cash flow.

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3Q1-Q3	R12 MAR
Net Sales	180.9	160.6	484.8	479.2	629.5
Growth, Net Sales %	12.6	-15.7	1.2	-11.8	-7.7
Organic growth %	12.6	-24.6	0.6	-25.3	-10.2
EBITDA	10.1	13.0	22.0	-4.8	30.9
EBITDA margin %	5.6	8.1	4.5	-1.0	4.9
EBIT	2.1	4.5	-2.8	-32.2	-2.9
EBIT margin %	1.2	2.8	-0.6	-6.7	-0.5
Adjusted EBIT	2.1	4.3	-4.6	-11.5	-16.4
Adjusted EBIT-margin %	1.2	2.7	-1.0	-2.4	-2.6
Net Debt/Net Cash (-)	15.3	29.9	15.3	29.9	15.3
excl. lease liability from
IFRS16	10.6	21.8	10.6	21.8	10.6
Capital employed	285.5	301.6	285.5	301.6	285.5
ROCE %	-1.0	-8.7	-1.0	-8.7	-1.0
Adjusted ROCE %	-5.6	-2.3	-5.6	-2.3	-5.6

Net sales per quarter / rolling 12 months

MSEK 250

200
150
100
50
0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

Adjusted EBIT per quarter / rolling 12 months

	MSEK
700	10												40
												30
600
5												20
500													10
400	0												0
300	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	-10
- 52020/2021	2021/2022			2022/2023		2023/2024
200				-20
												-30
100	- 10												-40
0													-50
	- 15												-60

D UR OC IN T E RIM RE P OR T Q 3 2 0 2 3 /2 02 4

Cresco develops, produces and sells textile- based solutions for the professional cultivation of crops and is one of the leading players on the global market. The products contribute to favorable environments in greenhouses, mushroom farms and composting installations. The most important product is a climate screen for greenhouses that controls the cultivation climate, contributing to a more efficient process with lower energy consumption. Cresco's production facility is in Belgium.

9 ( 2 4 )

Share of Duroc's sales (R12)

9%

• Net sales decreased by 20 percent. Organic growth was -19 percent. Sales volumes were 10 percent lower, where the industrial segment increased by 35 percent while the agro segment fell. However, the product mix affected gross profit, which increased by 2 percent.
• EBIT was burdened by increased costs due to inflation-based cost increases. The effect of mandatory wage increases was partially compensated by redundancies.
• The demand for major projects was very low due to the uncertain macroeconomic situation. However, there was still demand for replacement products and volumes in this respect were able to compensate for the loss of major projects.
• Moving forward, Cresco's efforts will focus on R&D, sales in new markets and continued cost adjustments. Demand for energy-saving climate screens for greenhouses and recyclable ground-cover fabric made from PLA (a biodegradable corn-based polymer) rose, as many countries seek to increase their self-sufficiency in food products.

Net sales per quarter / rolling 12 months

MSEK
100											400
90											350
80											300
70
60											250
50											200
40											150
30											100
20
10											50
0											0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3	Q1-Q3	R12 MAR
Net Sales	50.3	62.6	219.1	209.1	288.8
Growth, Net Sales %	-19.7	-13.1	4.8	-1.4	5.7
Organic growth %	-18.8	-19.2	-0.6	-7.4	-0.5
EBITDA	-7.0	-3.7	-7.9	2.8	-9.2
EBITDA margin %	-13.9	-5.9	-3.6	1.3	-3.2
EBIT	-8.2	-5.1	-11.9	-1.4	-14.7
EBIT margin %	-16.3	-8.1	-5.4	-0.7	-5.1
Net Debt/Net Cash (-)	25.0	30.2	25.0	30.2	25.0
excl. lease liability from
IFRS16	21.2	25.5	21.2	25.5	21.2
Capital employed	202.0	218.0	202.0	218.0	202.0
ROCE %	-7.1	2.0	-7.1	2.0	-7.1

Adjusted EBIT per quarter / rolling 12 months

MSEK
25												50
20												40
15												30
10												20
5												10
0												0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
- 52020/2021	2021/2022			2022/2023		2023/2024	-10
- 10												-20

D UR O C IN T E RIM RE P O R T Q 3 2 02 3 / 20 2 4

Plastibert has been established in the international coated textiles market for more than 60 years. Its products comprise PVC and PU coated fabrics that are used in a variety of areas, including rainwear and protective clothing, PPE, furniture for public spaces, wall coverings and vehicle interiors. Plastibert's production facility is in Belgium.

1 0 ( 24 )

Share of Duroc's sales (R12)

6%

• Net sales were on par with the previous quarter. Organic growth was -1 percent. Greater sales volumes, price increases to customers, a better product mix and improved capacity utilization in the factory led to a gross profit increase of 20 percent.
• Plastibert noted a continued increase in order intake during the quarter, which is expected to have a positive effect on the coming quarters.
• EBIT totaled MSEK 1.8 (-1.0). The company noted increased costs because of the increased production. The company also had higher personnel costs as a result of inflation-based wage increases as well as fully staffed shifts to meet the demand.
• Plastibert has carried out investments to enable production of DMF-free* technical textiles, which are in demand in the market that is looking for sustainable, toxin-free alternatives. In the increased order intake, which was noted during the quarter, DMF-free textiles were an important component.

Net sales per quarter / rolling 12 months

MSEK
50											200
45											180
40											160
35											140
30											120
25											100
20											80
15											60
10											40
5											20
0											0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
2020/2021	2021/2022			2022/2023		2023/2024

	2023/	2022/	2023/	2022/	2023/
	2024	2023	2024	2023	2024
Amounts in MSEK	Q3	Q3	Q1-Q3Q1-Q3	R12 MAR
Net Sales	48.0	48.0	125.4	131.3	171.0
Growth, Net Sales %	0.1	4.1	-4.5	5.4	-2.6
Organic growth %	-1.4	-2.6	-9.4	-0.9	-8.4
EBITDA	2.7	0.0	0.7	-7.2	0.4
EBITDA margin %	5.7	0.0	0.6	-5.5	0.2
EBIT	1.8	-1.0	-2.3	-10.4	-3.6
EBIT margin %	3.7	-2.2	-1.8	-8.0	-2.1
Net Debt/Net Cash (-)	4.7	10.0	4.7	10.0	4.7
excl. lease liability from
IFRS16	4.5	9.7	4.5	9.7	4.5
Capital employed	64.6	72.5	64.6	72.5	64.6
ROCE %	-5.5	-16.8	-5.5	-16.8	-5.5

Adjusted EBIT per quarter / rolling 12 months

MSEK
5												10
3												5
0												0
Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3
- 32020/2021	2021/2022			2022/2023		2023/2024	-5
- 5												-10
- 8												-15
- 10												-20

*DMF is a toxic solvent common in chemical products such as acrylic fibers, synthetic leather, and other plastic products.