Ecoclime : Annual Report 2020 (english)

ANNUAL REPORT 2020

ECOCLIME GROUP AB (PUBL)

CORPORATE IDENTITY NUMBER: 556902-1800

w w w. e c o c l i m e . s e

CONTENTS
2020 in brief..............................................................................................................................................	3
CEO comment...........................................................................................................................................	5
This is Ecoclime........................................................................................................................................	6
Markets.........................................................................................................................................................	7
Ecoclime's position on the property market...............................................................................	9
Ecoclime's business segments.........................................................................................................	10
January to December 2020..............................................................................................................	13
Business model and growth strategy............................................................................................	15
Sustainability with Ecoclime.............................................................................................................	17
Board of Directors' report.................................................................................................................	19
Financial statements...........................................................................................................................	20
Consolidated comprehensive income statement...................................................................	23
Consolidated income statement and other comprehensive income.............................	24
Consolidated statement of financial position..........................................................................	25
Consolidated statement of changes in equity.........................................................................	27
Consolidated cash flow statement...............................................................................................	28
Parent company income statement.............................................................................................	29
Parent company balance sheet.....................................................................................................	30
Parent company change in equity...............................................................................................	32
Parent company cash flow statement........................................................................................	33
Notes to consolidated financial statements.............................................................................	34
Notes to parent company financial statements......................................................................	65
Auditor's report...................................................................................................................................	76
FINANCIAL CALENDAR
May 6, 2021:	Interim Report January-March 2021
May 6, 2021:	AGM in Umeå, Sweden
August 19, 2021:	Interim Report, January-June 2021
November 11, 2021:	Interim Report, January-September 2021
February 17, 2022:	Year-end Report 2021

ADDRESSES

Company	Auditor
Ecoclime Group AB (publ)	Ernst & Young AB
Norra Obbolavägen 139	Box 7850
904 22 UMEÅ	103 99 Stockholm
Tel: [phone]	[phone]
www.ecoclime.se	www.ey.com
[e-mail]
Corporate Id No: 556902-1800

3

2020 IN BRIEF

Significant events during the year

• Ecoclime takes over the acquisition of the H-gruppen Total Installer Group
• Ecoclime initiates export collaboration with Xport
• Launch of Evertherm - a standardised product programme that increases the return on properties
• The CEO of SDC Automation acquires 85,000 shares from Ecoclime's main owners at SEK 6.50 a share
• Ecoclime signs a SEK 10M energy services agreement
• A change in Swedish law means that municipal water and wastewater companies may no longer prevent property owners from recovering heat energy from wastewater
• Ecoclime receives SEK 40M in a directed new share issue at SEK 10.30 a share
• Ecoclime relists its share to the Nasdaq First North Premier Growth Market
• A Nordic Energy Audit shows that Evertherm SEW systems could increase the value of Sweden's housing stock by SEK 60 billion
• The SDC Automation subsidiary projects sales of SEK 100M for its server room segment.
• Ecoclime recruits key people to its sales organisation

Key figures

	2020	2019	2020	2019
GROUP OCT-DEC	OCT-DEC	OCT-DEC	JAN-DEC	JAN-DEC
Sales	42 658	25 099	154 832	88 738
Net sales	39 691	20 726	139 701	72 679
EBITDA	5 997	4 053	17 570	8 341
EBITDA margin (%)	15%	20%	13%	11%
Operating profit before acquisition-related expenses (EBITA)	4 581	2 729	12 317	4 479
EBITA margin (%)	12%	13%	9%	6%
Cash flow from operating activities	2 430	3 728	18 322	-7 990
Cash liquidity (%)	166%	162%	166%	162%
Equity/asset ratio (%)	74%	75%	74%	75%
Earnings per share (SEK)	0,05	-0,06	0,15	-0,09
Equity per share (SEK)	5,11	4,47	5,47	4,81
Average number of share during the period	33 026 955	28 582 834	30 804 895	26 551 374
Number of shares at the end of the period	33 026 955	28 582 834	33 026 955	28 582 834

Lennart Olofsson

5

CEO COMMENT

Meeting our primary projection for accelerated growth

When we sum up 2020, we can say that we continued our successful growth journey during the year in line with our primary projection for our accelerated growth strategy, with almost a doubling of sales and a more than 100% improvement in EBITDA. We achieved this despite 2020 presenting challenges unlike anything I have experienced in all my years in Swedish business. Above all, Ecoclime, like other companies, has been affected by the corona pandemic that hit Europe in February. These external factors required immediate action to minimise damage.

On January 1, 2020, the acquisition of the H-gruppen came into effect. The pandemic had a major impact on H-gruppen's piping operations, with a 50 per cent drop in sales in the first half of the year. Restrictions that were introduced at the beginning of March meant that plans to integrate Ecoclime's and H-gruppen's activities had to be postponed for the time being. As a result, we focused even more on deepening our knowledge of the market for Evertherm's and Ecoclime's core products and developing our sales methods. This resulted in the business methodology and strategy, including a yield model and simulation programme, which we successfully implemented during the second half of 2020.

New business and strengthening of our organisational and financing structures during the autumn resulted in the creation of new projections for the business for the coming years. The listing on Nasdaq First North Premier, our SEK 40 million directed share issue - through which Hamberg Management with related parties became anchor investors - and the collaboration with their co-owned property company Solporten, are just some of the events in 2020 that are set to play a key role in the development of Ecoclime in the coming years. These steps include regulations for the new standardised Evertherm system, which, at the time of writing, already exceeds our entire 2021 sales target.

The fact that we achieved 2020's growth targets is in large part due to SDC Automation's major sales and performance successes. To date, the company has been unaffected by the pandemic and could have retained its

strong organic growth, not only due to ongoing construal agreements with world-leading companies in data centres and continuing integration projects in several large property development in the Stockholm region. SDC also won several new orders from large construction and property companies, resulting in the entire order book for 2021 being booked in 2020.

H-gruppen recovered in the autumn, especially through the KVS Montage subsidiary. It was the same for Flexible Air Treatment, which meant that despite lower annual sales, the business unit improved its performance and contributed to an improvement in the group's overall EBITDA result.

Another success in addition to SDC, KVS, Flexibel Air Treatment, and Evertherm in the autumn included the marked increase in interest in our indoor climate solu- tions. More projects were booked for existing customers, such as MVB, Atrium Ljungberg, Lilium Fastigheter, and Vattenfall, and new customers. For example, KVS Montage presented our indoor climate solution to property company Locum for a small-scale project at Karolinska Hospital in Stockholm, which resulted in four orders. In the long run, this project will be of considerable importance for the continued growth of indoor climate systems in healthcare properties.

In the latter part of the year, preparations for exports began, with Germany as the main target market in

2021. Ecoclime is now participating in several initiatives aimed directly at the German property market, German property companies, and several EU initiatives. Agreements have been reached with a German agent and with Brussels-based consultants who will be tasked with helping to open up the entire EU market for the longer term.

We are maintaining a high tempo in internal activities that will lay the foundations for the organic upscaling of Ecoclime's core products on the market in terms of sales, organisation, and routines to enable control over expanded growth targets that the Board will decide on in the first half of 2021.