Investment AB Latour: Interim report January - June 2025

NET ASSET VALUE AND THE LATOUR SHARE

• The net asset value at the end of the period was SEK 207 per share compared with SEK 215 per share at the start of the year, which is a decrease of 1.9 per cent adjusted for dividends. The benchmark index (SIXRX) increased by 2.3 per cent. The net asset value at 18 August was SEK 212 per share.¹
• The total return on the Latour share was -8.1 per cent compared with the SIXRX, which increased 2.3 per cent.

INDUSTRIAL OPERATIONS

The second quarter

• The industrial operations' order intake increased by 9 per cent to SEK 7,131 m (6,570 m). Adjusted for exchange rate effects, this equates to growth of 3 per cent for comparable entities.
• The industrial operations' net sales increased by 9 per cent to SEK 7,095 m (6,522 m). Adjusted for exchange rate effects, this equates to growth of 2 per cent for comparable entities.
• The industrial operations' adjusted operating profit increased by 4 per cent to SEK 989 m (947 m), which equates to an operating margin of 13.9 (14.5) per cent.
• On 3 April, Innovalift acquired the UK company Syntium Lifts and on 4 June, Nord-Lock Group signed an agreement to acquire 75 per cent of the shares in the UK company Energy Bolting Limited. The acquisition was completed on 1 July.

INDUSTRIAL OPERATIONS

January - June

• The acquisitions of the Turkish company Arkel for Innovalift, the German company Howatherm for Swegon and the German company HDS Group for LSAB within Latour Industries were finalised in the first quarter. In addition, Hultafors Group acquired the Danish company Lyngsøe Rainwear ApS and Swegon acquired the US company American Geothermal.
• The industrial operations' order intake increased by 14 per cent to SEK 14,694 m (12,834 m), which represents a 6 per cent increase for comparable entities adjusted for exchange rate effects.
• The industrial operations' net sales increased by 11 per cent to SEK 13,980 m (12,664 m), which represents a 2 per cent increase for comparable entities adjusted for exchange rate effects.
• Adjusted operating profit increased by 4 per cent to SEK 1,888 m (1,816 m), which equates to an operating margin of 13.5 (14.4) per cent.

THE GROUP

• Consolidated net sales totalled SEK 13,980 m (12,644 m), and profit after financial items was SEK 2,544 m (4,008 m). The net impact of impairments and reversals of impairments of shares in associates on the income statement in the period was SEK -164 m (800 m), and an impairment of SEK -152 m (0 m) was recorded for other assets.
• Consolidated profit after tax was SEK 2,290 m (3,651 m), which is equivalent to SEK 3.55 (5.68) per share.
• The Group reported net debt of SEK 18,521 m (13,011 m). Net debt, excluding lease liabilities recognised under IFRS 16, was SEK 16,898 m (11,597 m) and is equivalent to 11 (8) per cent of the market value of total assets.

INVESTMENT PORTFOLIO

• During the first six months, the value of the investment portfolio decreased by 4.2 per cent adjusted for dividends and portfolio changes. The benchmark index (SIXRX) increased by 2.3 per cent.
• During the first six months, Latour increased its holding in CTEK by 1,275,000 shares.

EVENTS AFTER THE REPORTING PERIOD

• CIO Johan Menckel has accepted the post of CEO at LKAB and will step down from his role at Latour by 1 April 2026.

¹ The calculation of the net asset value on 18 August was based on the value of the investment portfolio at 17.30 on 18 August and the same values as on 30 June were used for the unlisted portfolio.

Comments from the CEO
"The second quarter of the year was marked by continued uncertainty related to trade tariffs and macroeconomic conditions. Despite the challenges, the industrial operations' order intake developed positively and continued to grow during the quarter, driven by both acquisitions and organic growth. In the markets where we operate, overall demand remains at a relatively healthy level, although it varies across regions and sectors. The uncertainty is, to some extent, influencing customer investment decisions, leading to longer decision-making processes. This is particularly affecting the project-based operations within Swegon, Nord-Lock Group and Caljan. However, we are seeing a mixed picture, with Nord-Lock Group reporting a record high quarter for order intake, Swegon is organically in line with the corresponding quarter last year and Caljan slowing down. Hultafors Group is affected by the generally weaker construction industry in Europe, and is slight lower compared with the same quarter last year. We remain confident that our operations are well-positioned to navigate the current market environment and, as in previous periods, we are fully prepared to respond to shifts in demand.

During the summer, some clarification has been provided regarding US trade tariffs. However, uncertainty remains around which products and materials are exempt, as well as the outcome of ongoing negotiations with additional countries. In line with the first quarter of the year, we do not see any material economic impact from the tariffs during the second quarter. 11 per cent of the industrial operations' total sales are in the US. Caljan, Hultafors Group, REAC within Latour Industries and Nord-Lock Group have slightly more trade exposure to the US. We have local production to some extent, but the figures also include exports to the US that will be affected. However, the overall impact is limited. Approximately half of total US sales are imported from Europe, representing 5 per cent of the industrial operations' total turnover. This includes certain products that have, to date, been exempt from the 15 per cent tariffs. Imports from China account for 3 per cent of the industrial operations' total turnover and especially affect Hultafors Group, which has so far been hardest hit by the tariffs with lower sales in the US. Caljan has continued to deliver on previously placed orders, but has noted a decline in order intake during the quarter, partly as a consequence of the tariffs. We will try to pass any additional costs incurred because of tariffs to the customer to the extent possible.

During the second quarter, total order intake grew by 9 per cent, 3 per cent of which was organic. Net sales grew by 9 per cent, 2 per cent of which was organic. New acquisitions boosted order intake by 11 per cent and net sales by 12 per cent. By the end of the quarter, the order book had increased to SEK 6,854 m, which ensures a good invoicing trend in the coming quarters. Adjusted operating profit increased to SEK 989 m (947 m) with an operating margin of 13.9 (14.5) per cent. We are maintaining a good cost control, but significant fluctuations in exchange rates are adversely affecting the gross margin in some parts of the operations. Cash flow largely follows the normal seasonal pattern and amounts to SEK 858 m (819 m) for operating activities.

We are continuing to make long-term and forward-looking investments in both new and existing businesses. During the quarter, Hultafors Group invested in increased production capacity in Europe by acquiring an existing fleet of machinery in Latvia. We regularly invest in our factories, in product development and digitalisation and, most importantly, in our employees to bolster future growth. Sustainability continues to be a core priority for us. We believe that being in the forefront is essential for being long-term relevant and delivering strong returns to our shareholders.

Due to the current uncertainty, acquisition activity was somewhat lower in the second quarter. Latour's financial strength do allow us to invest despite an economic downturn, but always in a prudent and responsible manner. Two great acquisitions have been made within the wholly-owned operations. One for Innovalift and one for Nord-Lock Group. These acquisitions, together with the five that were made during the first quarter, contribute just over SEK 1.8 billion to annual revenue growth. More information about our acquisitions can be found on page 4.

The stock market was characterised by subdued activity in the first six months of the year. During the period, the net asset value of Latour decreased by 1.9 per cent and the value of our portfolio of listed holdings decreased by 4.2 per cent. By comparison, the benchmark index SIXRX increased by 2.3 per cent. All of our listed holdings have now submitted their Q2 statements and overall, these are good reports given the global situation. The market value of the portfolio of listed holdings has increased again since mid-year, driven by, among others, ASSA ABLOY. This is also reflected in Latour's net asset value. The share price was SEK 212 when the stock exchange closed yesterday, equating to an increase of 0.7 per cent since the beginning of the year."

Johan Hjertonsson
President and CEO

For further information please contact:
Johan Hjertonsson, President and CEO, Tel. [phone] or
Mikael Johnsson Albrektsson, CFO, Tel. [phone]

Conference call
President and CEO Johan Hjertonsson and CFO Mikael Johnsson Albrektsson present the report and answers to questions in a webcasted teleconference today at 10.00 AM (CEST). The conference call will be held in English.

Webcast
Via the webcast you are able to ask written questions.
If you wish to participate via webcast, please use the link:
https://latour.events.inderes.com/q2-report-2025

Teleconference
You can ask questions verbally via the teleconference.
If you wish to participate via teleconference, please register on the link below.
After registration you will be provided phone numbers and a conference ID to access the conference.
https://conference.inderes.com/teleconference/?id=50051327

The information contained in this report constitutes information which Investment AB Latour (publ) is required to disclose under the EU Market Abuse Regulation. The information was provided by the above contact persons for publication on 19 August 2025 at 08.30 CEST.