Investor AB (publ)

Good morning and welcome to Investors Results Call for the fourth quarter and full year 2024. I am joined here today by our new CFO Jenny Arsman-Hakvinius. Warm welcome to you Jenny and our CEO Kristian Sederholm. Both will soon give their presentations and after that we will be opening up for questions. both on the call via our operator and online. And with that, over to you, Christian.

Thank you, Jacob. And hello, everyone. Warm welcome. Let me start with a brief summary of the full year before jumping into the fourth quarter. Net asset value grew by 20%, and investor B returned 27%. This compares with 9% for 6RX. All three business areas contributed to our NAV growth in 2024. Our portfolio companies generally performed well in a quite demanding environment, delivering profitable growth and cash flow. Also, they've invested significantly to future-proof their business, both through organic initiatives, but also M&A. We continue to push for accelerated use of data and AI to enhance efficiency and customer value. Investment activity has been high and we've invested across all three business areas during the years. Including investments in Ericsson, add-on acquisitions in Patricia Industries and gross investments into EQT funds. Supported by positive cash flow from all business areas and a strong balance sheet, the board has proposed a dividend of 5.2 krona, which represents an increase of 8% versus last year, in line with our ambition to pay a steadily rising dividend. Let me move now to the quarter. At the end of Q4, our net asset value stood at 970 billion kronor, This represents a decrease of 2% in the fourth quarter and a total return on our B-share of minus 6%, same as for six Alex returned during that period. Let me briefly go through the three business areas, starting with listed companies, which represents about 70% of our portfolio. Total return was minus 4% in the quarter with mixed returns in individual companies. As usual, the companies have been active, both delivering here and now, but also investing for the future. AstraZeneca, as an example, committed to a US$3.5 billion investment in the US, its single biggest market. The investments include the R&D Center in Cambridge, Massachusetts, and a next-generation biologics factory in Maryland. I had the pleasure of meeting with the CEO of Alexion, AstraZeneca's rare disease arm, in Boston in November. I was very impressed with the development of both the existing treatment and the future pipeline, of course to the benefit of patients around the world. David Meek has been appointed new chair of Zobe, and Torbjörn Lööf was nominated new chair in Husqvarna in addition to his current position as chair in Electrolux. More broadly, we've seen good activity level in a number of nomination committees. If I move to Patricia Industries then, total return for Patricia Industries was 6%, including cash, with good underlying earnings growth and also some significant tailwind from the strong US dollar, especially towards the end of the quarter. Our major subsidiaries grew sales organically by 3% and underlying EBITDA by 11%. While, for example, Labori and Mönlycke contributed to growth in a nice way, Brownability and Atlas Antibodies both had a tough fourth quarter with weak demand in their respective end markets. Innovative products continue to drive growth for several companies, including OptiLoom for Labori that we mentioned before. We've seen no major add-ons during the quarter, but activity continues to be high. And add-on acquisitions is and remains an important complement to organic growth and a great way to add people, products, technologies or enter new markets. Strengthening of the boards has happened in several companies and we have announced a new share in Vektura. For the full year then, organic sales ended at 6% for the Patricia subsidiaries, and underlying earnings grew by 9%. If I turn to Mönlycke specifically, they reported 8% organic growth in the quarter, with all business areas and all major regions contributing. The EBITDA margin was up about one percentage point, supported not the least by growing sales and foreign exchange. Wound care grew 10% with growth in all regions, and, encouragingly, products from prevention of pressure ulcers, including dressings and turning-in-position solutions, continued to grow well. In the quarter, Mönlyk also announced a strategic minority investment in a US-based company called Siren, which focuses on an innovative solution for prevention of diabetic foot ulcers. ORS grew 3% organically, primarily helped by good development in Chase. And gloves continue to grow, supported by strong growth in the Middle East and a stable US market. On a reported last 12-month or rolling 12-month basis, sales in EBITDA, including here our 40% in 3 Scandinavia, grew and ended up north of 66 billion in sales and north of 16 billion in EBITDA. Investments in IQ-tiden, our third business area, which represents about 10% of our portfolio, Here in Q4, the value change was minus 5% in total, which was driven by the decline in EQT AB, the listed share, while the fund performance was up. As you know, our performance or valuation in funds are reported with a one quarter lag. We could see this morning in EQT's result that the fund performance in Q4 continued to be strong. Investment activity has remained high and several exits have been made too. One third of the Q4 fund proceeds relate to partial exits in Galderma and Idealista as two examples of exit activity. It was a strong year for fundraising overall as well for EQT. So, to summarize, we have a strong platform and a clear strategic direction. To continue deliver on this, we focus relentlessly on performance, portfolio and people. Performance, as you know, is about profitable growth here and now and investing appropriately to future-proof our businesses. Portfolio is about making sure we're invested in strong companies in attractive industries. People. This is about attracting and retaining great people to Investor and to our companies to drive performance and transformation over time. If we do this well, we will be able to deliver on our three strategic priorities, which is to grow net asset value, to pay a steadily rising dividend and to deliver on our ESG targets. All in line, of course, with our overall purpose, which is to create value for people and society by building strong and sustainable businesses. With that, I'd like to leave over the word and the pointer to Jenny.

Thank you so much, Christian. And good morning, everyone. In Q4 2024, adjusted net asset value was 970 billion. This implies a decrease of 2% compared to Q3. However, looking at the full year, net asset value grew 20% compared to 6RX of 9% for the same period. Looking more closely at the quarter, performance was mixed across our business areas, a positive 6% return for Patricia Industries, while we saw a decline in listed companies and investments in EQT. However, again, looking at the full year, we see that all business areas contributed to the strong growth of 20%. And now I will comment more specifically on each of the business areas, starting with listed companies. And within listed companies, share price performance was mixed. Highlights include Ericsson, Nasdaq and Saab, while some of our larger companies had a weaker share price development in the quarter. Nevertheless, total return was a negative 4%, so still outperforming 6RX, which was a negative 6%. And if we look at absolute contribution, it paints a similar picture. But of course, with Atlas Copco as the biggest negative impact on net asset value, given the weight and the size in our portfolio. Moving on to Patricia Industries, we saw 6% growth in estimated market values compared to Q3, so from 225 billion to 239 billion, including cash. Currency is the biggest value driver, and that's explained by a weaker Swedish krona in relation to US dollar, in part boosting earnings, but also from translation effect in valuation. However, the value increase was also underpinned by growth in earnings, while somewhat offset by a lower valuation multiple. And looking at operating performance in the companies to highlight a few themes, most companies reported good growth with significant contribution from new and innovative products. For Laboree, we continue to see good growth from Optilum products launched in 2022 and late 2023. And for Mönlycke, as Christian already mentioned, we continue to see good progress in products for pressure ulcer prevention. Braunability and Atlas Antibodies had a tougher ending to the year, mainly due to weaker market demand. Margins held up well overall and were supported by operating leverage, while somewhat offset by continued OPEX investments to ensure sustainable and profitable growth long term. Looking at value development across companies, we see North American companies in the lead, in part explained by currency, as mentioned earlier. Worth highlighting is a capital contribution made to Victura of 342 million to support ongoing project developments, and also a second distribution from Mönnlycke for 2024, which was 3.5 billion in the quarter. And then finally on to investments in EQT, the total value change was a negative 5% in the quarter and that was driven by the weaker share price performance in EQT AB, while the value of our fund investments increased 5%. On the right hand side we illustrate the net cash flow from EQT to investor which was positive with 1 billion in the quarter as the sum of dividend and proceeds were larger than drawdowns. As highlighted by Christian, we have a proven business model and a clear strategic direction. And to deliver on our strategy and strategic priorities, financial flexibility is key. We have three business areas, all of which generate cash flow to support investments and a steadily rising dividend to our shareholders. From listed companies, we receive ordinary as well as extraordinary dividends. In Patricia Industries, the portfolio companies generate cash flow, which can be reinvested in the companies or paid in distribution. And for investments in EQT, we have an ownership in EQT AB, which yields an annual dividend, as well as fund investments where cash flow is by definition lumpy and dependent on drawdowns and exits, but remains a strong contribution to cash flow over time. And from listed companies, we've received 97 billion Swedish kronor in ordinary dividends since 2015. And on top of that, an additional 8 billion in extraordinary dividends and redemptions. The ordinary dividend received has grown with 8% on average per year. In Patricia Industries, we have a strong growth in EBITDA across major subsidiaries, and these companies also have a very strong cash conversion. So this translates into cash flow that can be reinvested in the businesses or paid as distribution. For EQT, as already mentioned, net cash flow is inherently more lumpy, but looking since 2015, the average annual net cash flow from EQT to investor has been north of 2 billion per year. So this platform with three strong business areas provides a broad-based cash flow that supports continued growth and distributions after management cost and financial net. The incoming funds provide strong investment capacity and have been deployed across all of our three business areas. And as mentioned by Christian, we've invested in 2024, roughly 10 billion. And on top of that, an additional 5 billion financed by Patricia Industries companies through cash and debt. While sustaining high level of investment activity, more than 50% of incoming funds have been distributed to shareholders. So that's a total of 100 billion since 2015. and we have continuously delivered on our commitment to pay a steadily rising dividend. The average annual growth has been 9% during the past 10 years. The dividend proposal for 2024 is 5 kronor and 20 öre per share, which is an increase with 40 öre per share compared to 2023. And as you know, our balance sheet remains strong, supported by value creation and underlying cash flow. Leverage was 1.2% in the quarter, in the bottom end of our policy range, and we have a strong rating by both Standard & Poor and Moody's. Our average debt maturity is roughly 10 years and we have no repayment due until 2029. Onto my last slide. Here we illustrate average annual total return for the investor B share. And we are concluding that the investor B share has beaten our internal return requirement, which is highlighted in orange, as well as our benchmark index 6RX in the short term, but also in the long term. And with that, I will leave the word back to Jacob.