OTHER FINANCIAL INFORMATION

Profitability, financial position and cash flow
The return on equity at the end of the period was 31 percent (26), and return on capital employed was 21 percent (17). Return on working capital P/WC (EBITA in relation to working capital) amounted to 66 percent (61).

At the end of the period the equity ratio amounted to 32 percent (32). Equity per share, excluding non-controlling interest, totalled SEK 15.95 (12.30). The Group's net debt at the end of the period amounted to SEK 5,011 million (3,480), excluding pension liabilities of SEK 224 million (336). The net debt/equity ratio, calculated on the basis of net debt excluding provisions for pensions amounted to 1.1 (1.0).

Cash and cash equivalents consisting of cash and bank equivalents and approved but non-utilised credit facilities amounted to SEK 1,277 million (1,450) at 30 September 2022.

Cash flow from operating activities amounted to SEK 524 million (435) during the period. Company acquisitions and disposals including settlement of contingent consideration regarding acquisitions implemented in previous years amounted to SEK 982 million (592). Investments in non-current assets totalled SEK 65 million (36) and disposal of non-current assets amounted to SEK 3 million (6). Repurchase of treasury shares amounted to SEK 31 million (0) and repurchase of call options amounted to SEK 58 million (36). Exercised and issued call options totalled SEK 11 million (7). During the second quarter, dividend of SEK 1.80 (1.20) per share was paid, totalling SEK 485 million (323). 

Employees
At the end of the period, the number of employees was 3,805 compared to 3,556 at the beginning of the financial year. During the period, completed acquisitions resulted in an increase of the number of employees by 197. The average number of employees in the latest twelve month period was 3,553.

Ownership structure
At the end of the period the share capital amounted to SEK 51.1 million.

In accordance with a resolution of the August 2022 AGM, 100 members of management were offered the opportunity to acquire 1,000,000 call options on repurchased Class B shares. In total, 825,910 options were subscribed for. Addtech has four outstanding call option programmes for a total of 2,749,980 shares. Call options issued on repurchased shares entail a dilution effect of about 0.1 percent during the latest twelve month period. During the quarter, 200,000 treasury shares were repurchased. Addtech's own shareholdings fully meet the needs of the outstanding call option programmes.

Acquisitions and disposals
During the period, 1 April to 30 June 2022 the following acquisitions were completed; Intertrafo Oy, Finland, and Arruti Group, Spain, was acquired to become part of the Energy business area. Electric Control Systems Automation AS, Norway, and C.K. Environment A/S, Denmark, was acquired to become part of the Process Technology business area. Impulseradar Sweden AB, Sweden, was acquired to become part of the Industrial Solutions business area.

On 1 July, Gotapack International AB, Sweden, was acquired to become part of the Process Technology business area. Gotapack has strong industry expertise in equipment, spare parts and service to the pharmaceutical industry. The main products include processing and packaging machinery. The company has 5 employees and sales of around SEK 25 million.

On 1 August, Allied Insulators Ltd., Great Britain, was acquired to become part of the Energy business area. Allied Insulators is a leading supplier of equipment and components for electrical distribution- and transmission lines and sub-stations in the UK. The company has 15 employees and sales of around GBP 6 million.

The purchase price allocation calculations for the acquisitions completed during the period 1 April - 30 September 2021 have now been finalised. No significant adjustments have been made to the calculations. Acquisitions completed as of the 2021/2022 financial year are distributed among the Group’s business areas as follows:

If all acquisitions which have taken effect during the period had been completed on 1 April 2022, their impact would have been an estimated SEK 344 million on Group net sales, about SEK 43 million on operating profit and about SEK 32 million on profit after tax for the period.

Addtech normally employs an acquisition structure comprising basic purchase consideration and contingent consideration. The outcome of contingent purchase considerations is determined by the future earnings reached by the companies and is subject to a fixed maximum level. Of considerations not yet paid for acquisitions during the period, the discounted value amounts to SEK 110 million. The contingent purchase considerations fall due for payment within three years and the outcome is subject to a maximum of SEK 147 million. 

Transaction costs for acquisitions that resulted in an ownership transfer during the period, amounted to SEK 6 million (6) and are reported under Selling expenses.

Revaluation of contingent consideration had a positive net effect of SEK 4 million (-4) during the period. The impact on profits are reported under Other operating income and Other operating expenses, respectively.

According to the preliminary acquisitions analyses, the assets and liabilities included in the acquisitions were as follows, during the period:

Parent Company

Parent Company net sales amounted to SEK 41 million (32) and profit after financial items was SEK -50 million (-11). Net investments in non-current assets were SEK 0 million (0). The Parent Company's financial net debt was SEK 591 million (315) at the end of the period.