The interim report has been prepared in accordance with IFRS as adopted by the EU, with IAS 34 Interim Financial Reporting being applied. Apart from in the financial statements and their accompanying notes, disclosures in accordance with IAS 34.16A also appear in other parts of the interim report. The interim report for the Parent Company has been prepared in accordance with the Annual Accounts Act and the Securities Market Act, which is in accordance with the provisions of RFR 2 Accounting for Legal Entities.
In the interim report, the same accounting principles and bases of calculation have been applied as in the most recent annual report, with the exception of the amended accounting principles described below.
New and amended standards for the 2020/2021 financial year
Other new or amended IFRS are not expected to have any significant effects on the Addtech Group.
Governmental support measures
Those governmental support measures that have been received or will be received as an effect of the Covid-19 pandemic will be recognized in the income statement when it is reasonably certain that the conditions for receiving the support have been met or will be met.
Alternative performance measures
The Company presents certain financial measures in the interim report that are not defined according to IFRS. The Company believes that these measures provide valuable supplemental information to investors and the Company's management as they allow for evaluation of trends and the Company's performance. Since all companies do not calculate financial measures in the same way, they are not always comparable to measures used by other companies. These financial measures should therefore not be considered to be a replacement for measurements as defined under IFRS. For definitions and reconciliation tables of the performance measures that Addtech uses, please see page 22-25.
Risks and factors of uncertainty
Addtech's profit and financial position, as well as its strategic position, are affected by a number of internal factors under Addtech's control and by a number of external factors over which Addtech has limited influence. The most important risk factors are the state of the economy, combined with structural change and the competitive situation.
The Covid-19 pandemic that erupted during the beginning of 2020 affects the entire world market and also affect Addtech. Addtech continues to follow the recommendations of the relevant authorities and takes relevant health precautions to protect staff and reduce the spread of infection in society. There are challenges in the supply chain and uncertainties exist about our customers’ ability to keep their businesses running at full capacity. All companies in the Group have action plans and cost-cutting programs ready to be executed to protect earnings, liquidity and cash flow if the situation should change.
Addtech has a few operating subsidiaries within the UK as well as a few other subsidiaries doing business with the UK. Addtech Group’s total exposure to possible negative effects from Brexit is not considered material.
Beside this, risks and uncertainty factors are the same as in previous periods, please see section Risks and uncertainties (page 41-43) in the annual report for 2019/2020 for further details.
The Parent Company is indirectly affected by the above risks and uncertainty factors due to its role in the organisation.
Effects of the Covid-19 pandemic
After the outbreak of the Covid-19 pandemic the Swedish government has decided on a number of government support measures. The same has also been decided in other countries where the Addtech group operates. Addtech has analyzed the conditions for these support measures and has applied where the criterias are judged to be met.
At the end of the fourth quarter, approximately 250 of the Group’s total approximately 3,100 employees have been notified of redundancy and a further 120 employees are affected by short-term lay-offs. For the group in total EBITA was marginally positively affected during the fourth quarter and during the period there has been a positive effect of approximately the equivalent of 0.4% of sales due to governmental support measures. These grants are recognised under other operating income, or as a reduction in personnel expenses, depending on local practices in different countries.
Sales are estimated to have been moderately negatively affected during the fourth quarter and in the period as a whole, with a sequential improvement after the first six-month period. It is primarily sales in the special vehicles, the marine and the mechanical industry segments that have been affected. No significant write-downs have been done due to the current pandemic.
Transactions with related parties
No transactions between Addtech and related parties that have significantly affected the Group's position and earnings have taken place during the period.
Addtech's sales of high-tech products and solutions in the manufacturing industry and infrastructure are not subject to major seasonal variations. The number of production days and customers' demand and willingness to invest can vary over the quarters.
Annual Report 2020/2021
The annual report for 2020/2021 will be published on Addtech’s website www.addtech.com in July 2021. A printed version will be distributed to the shareholders who request this.
Annual General Meeting 2021
The Annual General Meeting (AGM) of Addtech AB will take place at 2:00 p.m on Thursday 26 August 2021. A notice of the AGM will be published in July 2021 and will also be available on www.addtech.com.
The Board of Directors proposes dividend of SEK 1.20 (1.00) per share, which corresponds to a dividend payment of about SEK 323 million (269), which is in line with Addtech's dividend policy with the objective of a dividend that exceeds 30 percent of average Group profit after tax over a business cycle.
Events after the end of the financial year
On 1 April, ESi Controls Ltd., Great Britain, was acquired to become part of the Power Solutions business area. ESi (Energy Saving Innovative) Controls is a UK based company designing and delivering energy efficient electronic controls for heating and smart building applications. ESi Controls Ltd. has a turnover of approximately GBP 8 million and have 15 employees.
On 1 April, Hydro-Material Oy, Finland, was acquired to become part of the Component business area. Hydro-Material delivers hydraulic solutions and cooling systems to primarily the market segments special vehicles and the manufacturing industry. Hydro-Material Oy has sales of approximately EUR 5 million and 5 employees.
On 3 May IETV Elektroteknik AB, Sweden, was acquired to become part of the Energy business area. IETV Elektroteknik AB is a knowledge company that offers qualified services in power supply to railways, hydropower and industry. IETV Elektroteknik AB has 38 employees and has annual sales of approximately SEK 80 million.
On 11 May, AVT Industriteknik AB, Sweden, was acquired to become part of the Automation business area. AVT designs and manufactures industrial automation equipment primarily for the manufacturing, pharma and automotive industry. The offering includes electrical and mechanical design, programming of PLC and industrial robots, vision technology, installation and service. The company has 42 employees and sales of around SEK 70 million.
Preliminary purchase price allocations have not yet been completed.
Stockholm May 18, 2021
CEO and President
This information is information that Addtech AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out below, at 8.15 a.m CET on 18 May 2021.
2021-07-16 Interim report 1 April - 30 June 2021
2021-08-26 Annual General Meeting 2021 will be held at 2.00 p.m
2021-10-28 Interim report 1 April - 30 September 2021
2022-02-08 Interim report 1 April - 31 December 2021
The Group's annual report for 2020/2021 will be published on Addtech's website in July 2021.
For further information, please contact:
Niklas Stenberg, President and CEO, +46 8 470 49 00
Malin Enarson, CFO, +46 705 979 473