Volati Interim Report January-June 2021.

”A strong quarter with several important acquisitions”
Andreas Stenbäck, President and CEO

Quarter April-June 2021

Net sales increased by 20 percent to SEK 1,641 (1,366) million
EBITA increased by 33 percent to SEK 191 (144) million
Profit after tax increased by 34 percent to SEK 129 (96) million
Earnings per ordinary share increased by 107 percent to SEK 2.47 (1.19)**
The distribution of Bokusgruppen AB was completed in June
Scanmast AB was acquired in June
The bond of SEK 600 million was repaid in June

Period January-June 2021

Net sales increased by 21 percent to SEK 2,894 (2,394) million
EBITA increased by 45 percent to SEK 293 (203) million
Profit after tax increased by 65 percent to SEK 195 (119) million
Earnings per ordinary share increased by 146 percent to SEK 2.88 (1.17)**

Events after the reporting peiod

Martin Hansson takes over as new CEO of Salix Group AB on 1 September
The acquisitions of StrongPoint’s labels business and Byggsystem Direkt were completed on 1 July
The Spanish company Apisa S.L. was acquired on 6 July

** Key figures including discontinued operations.

Comments from the CEO
Volati continued its rapid growth in the second quarter, with a strong performance from both of our business areas. Volati’s total EBITA for the quarter increased by 33 percent to SEK 191 million. We are also maintaining a high acquisition rate with four acquisitions since the start of the quarter. Together, they have added more than SEK 700 million in annual sales.

The final steps towards a more focused Volati were taken during the quarter. We now have two successful, fast-growing business areas in Salix Group and Industry, with Salix Group’s governance now further decentralised through the establishment of its own Board with an increased decision-making mandate. We also completed a successful distribution of Bokusgruppen, which now has its own platform on Nasdaq First North Premier for its continuing growth journey.

Our ambition with this focus is clear – to create the best conditions for continuing a high growth rate and long-term value creation for our shareholders. This frees up resources for Volati to invest in further acquisitions. It also enables us to provide even better support to our companies in areas such as strategic HR by ensuring leadership supply and development. Responsibility for operational development lies with the companies. However, Volati has the important role of giving companies better conditions to develop with us than in their previous environment – fully in line with our vision of being the best owner of medium-sized companies.

Continuing business area growth
The highly positive trend of the last year has continued in the second quarter, with good growth in both the Salix Group and Industry business areas. The business areas have performed strongly in an external environment that poses operational challenges due to the pandemic, such as rising material prices and disrupted supply chains. I am proud of the vigorous response of our management teams to the situation, which has minimised the impact on margins.

We are also delighted at the appointment of Martin Hansson as the new CEO of Salix Group, with Håkan Karlström stepping down at his own request after 25 successful years. Martin’s broad experience in growth companies and international expansion, including in IKEA’s Group management, makes him very well suited to lead a growth-oriented Salix Group.

Several important acquisitions
Since the start of the second quarter, we have completed four acquisitions with total annual sales of approximately SEK 700 million and profitability before synergies in line with the Group as a whole. We have made three add-on acquisitions for business units in Industry business area – Ettiketto, S:t Eriks and Tornum – and one acquisition that takes us into a new area, in this case telecom infrastructure.

We continue to see good opportunities for acquisitions. More time and resources are being devoted to identifying acquisition situations that suit us, and being perceived as a natural industrial buyer means we have a good inflow of add-on acquisitions. Our discipline in the acquisition process ensures that we create value at the actual point of acquisition and have a clear plan for future value creation in the acquired companies.

Synergistic add-on acquisitions are a priority
Add-on acquisitions, where we benefit from synergies, are a high priority for us and are in line with our ambition to build strong business units, with some of them eventually developing into separate business areas in the Group. Ettiketto is a good example of this. With three add-on acquisitions, we have increased the business unit’s annual sales from about SEK 250 million to SEK 750 million in the space of a year.

Synergistic add-on acquisitions are complemented by acquisitions that broaden our operations to new areas. I am very pleased that we were able to announce such an acquisition during the quarter. Scanmast is a leading supplier of infrastructure in the form of masts and towers for telecom, lighting and surveillance. The acquisition gives us further exposure to the infrastructure sector, where we expect continued structural growth in selected segments and where we already have a presence through S:t Eriks.

Focused on growth
This summary of my first period as CEO of Volati is marked with enthusiasm. The Group has a clear growth orientation, with two fast-growing business areas and a strong focus on acquisitions. We have a strong balance sheet, with net debt at the end of the quarter at 1.3 times EBITDA, well below our financial target and providing significant scope for acquisitions. All in all, this means that we are well placed to continue creating growth and long-term value for our shareholders.

Andreas Stenbäck, President and CEO Volati