Indutrade AB (publ)

Good morning and welcome on our behalf as well. We are obviously happy to present the new strong quarterly report from Indutrade. And as usually, let's start with some of the overall highlights. It's satisfying that we continue to grow in order intake, sales and profits with a new record high EBITDA margin. And this thanks obviously to the great performance from our companies and employees. We saw a continued solid demand situation during the third quarter in most business areas, similar to what we saw in Q2. There was, however, some variations between different customer segments, companies, and geographical areas, which is partly due to the strong references from the same period last year. Order intake grew in total with 20%, of which 8% was organic growth. net sales grow a total of 27 which is very high and also one of the reasons for why the book to bill ratio is below 100 organic sales growth was also high at 14 there are still some supply chain disturbances which are challenging for many of our companies but the situation has improved somewhat for some of our companies during the quarter, and I would say that that's primarily linked now that delivery accuracy is becoming better and better. For the second quarter in a row, EBITDA exceeded 1 billion SEK and up 28% from the same period last year. And the strong organic sales development, positive effects from acquisitions, also had a positive effect on the EBITDA margin, which was at 15.4%, a new record level for Infrared. On the acquisition side, we had a good pace in quarter three with five completed acquisitions. And yesterday, we also signed a larger acquisition with a Danish company, Bramming Plast Industry. In total, we have now completed 13 acquisitions so far this year, adding some 1.4 billion SEC in annual revenues to the group. If we turn to order intake, I would say that the demand was continued solid in the quarter, and orders grow, as I said, organically 8% versus strong references last year, and was slightly up also sequentially from quarter two. There is, as you know, a seasonal downturn in the quarter due to summer holidays, and it's therefore difficult to analyze underlying demand changes. But our daily order analysis show a stable demand development through the whole quarter. The majority of our companies continue to show organic order growth in the quarter. Actually, a few more grow in quarter three than in quarter two. all customer segments continue to grow on aggregated level but there is a variation between companies as we have talked about earlier the process industry continued to stand positively with a good development for almost all companies and geographies in for instance infrastructure and construction and in parts of the medtech and pharma customer segments we see bigger variation and slightly more companies declining somewhat Partly this is due to very strong references last year, and one obvious explanation is less COVID-19 vaccine-related businesses. Borders grew organically in seven out of eight business areas during the quarter. The strongest developments were in business area Dax and Finland. The weakest development was in business area UK. mostly connected to a few companies supplying to the infrastructure and construction and marine customer segments. The total growth in the quarter was plus 20% order intake wise and as I said 8% organically. Acquisition effects was plus 8% and currencies plus 4%. If we then turn to our net sales situation, The sales growth rate increased significantly during the quarter. Total net sales development was plus 27% versus last year. And the organic development increased to plus 14%. Acquisitions contributed with 8% and currencies with 5%. the increased sales growth contributed to a slightly slight order backlog reduction in five out of eight business areas and in two business area business areas it was unchanged and the backlog continued to increase in one business area sales was on aggregate three percent higher than orders in the quarter Again, the book to build below 100 is more driven by very high sales rather than a weak order intake, which wasn't the case. The supply chain issues with long lead time from suppliers and component and product shortages continue during the quarter, but some companies experienced a slightly better situation. The worst impact is still within business area measurement and sensor technology, connected to supply of electronics. Price is obviously a large component of the growth we see now. With our diverse structure, it is extremely difficult to get a consolidated view of the balance between price and volume, but we have estimated pricing effects to be around seven to eight percent in the quarter versus last year, meaning that sales growth in volume was around six to seven percent. We also have a slide of the sales growth in different geographical markets, and it's basically positive in all major countries and regions. Standing out most is Denmark, with the medtech and pharma customer segments. In Germany, it is, for instance, the energy sector and the chemical segment, and in Asia, also the energy sector. Slightly weaker aggregate sales growth in the Netherlands, mainly connected to the infrastructure and construction segment. As I've talked about before, a high priority for us is to engage with our companies and support them to grow organically. It's, I would say, the prioritized strategic objective since some time back now. and organic sustainable profitable profitable growth is a verification that you have a competitive offering appreciated by the customers and it is a good value generator obviously we have now had eight consecutive quarters with organic sales growth despite challenging references and all the supply chain issues obviously a good support from a global strong demand situation

and high price effects, but the foundation, we believe, is our well-positioned and competitive companies. The growth rate increased during the quarter, both versus Q3 2021, but also sequentially.

All business areas grew organically also in this quarter, and a clear majority of the companies develops positively. We have an uncertain market environment, but the high backlog, however, gives us a good base to deliver further organic growth also the coming quarter. EBITDA increased during the quarter with plus 28%. As I said, it exceeded one billion SEC and increased to an all-time high margin of 15.4%. versus 15.3 last year. In the same way as last year, we had some one-offs during the quarter relating to smaller revaluations of earnouts and goodwill write-downs. In total, this had a positive effect of 16 million SEC. Excluding these one-offs, the EBITDA margin was 15.2%, and the comparable number last year was 15.0%. The organic EBITDA margin was stable. The strong growth development was basically offset by slightly lower gross margins and higher activity and expense levels in many companies. The newly acquired companies continue to show good margin levels and contributed also this quarter to the improved group margin. All in all, EBITDA increased organically with 14%, acquisitions added nine, and currencies four. all business areas grew organically in the quarter and seven out of eight grew double digit we saw the strongest growth in business areas flow technology supported by a broad positive development medtech and pharma and process industry customer segments stand out positively the medtech and pharma customer segments was also one of the key drivers in the growth for business areas benelux dash fluid and mechanical solutions and also industrial components the growth in business area Finland was broad-based with the process industry being a strong contributor the most positive customer segments in the quarter for business area measurement and sensor technology belong to energy HVAC and also professional communication The majority of our companies in business area UK grew organically in the quarter, but the aggregated growth was slightly lower than the other business areas. This was primarily because of a few companies in the infrastructure and construction segments.