A long-term industrial developer of listed companies

Transcription

1 A long-term industrial developer of listed companies Interim Report, January - September Industrivärden, October 31, 2008 AN_Pres_KV308 Nr 1

2 Mission, goal and strategy Business mission Create shareholder value based on a professional investment operation and active ownership Our goal Generate high growth in net asset value over time Industrivärden s stock will deliver a high total return to shareholders Portfolio Scope: Individual investments Market value: Type: Concentrated portfolio Large and midcap companies Mainly listed Conditions Sectors: Business models: Ownership structure: Investment horizon: Sector generalist Geographically scalable Possibility to be major or largest owner 3-8 years Exit: Appropriate exit once target value has been created Geography: Requirement: Nordic companies Major potential for value creation AN_Pres_KV308 Nr 2

3 Company in brief Established: 1944 Stock: Market cap: Free float: 386 million shares, listed on SSEX Approx. USD 2.7 bn (SEK 21 bn) Approx. 40% of shares No. shareholders: 43,000 Average daily trading vol.: Approx. 280,000 shares Coverage: Handelsbanken Markets, Magnus Dalhammar Enskilda Securities, Andreas Joelsson, UBS Nordic, Olof Cederholm Low administrative expenses, USD 14 M or 0.2% of AUM Holding company tax status: no tax on capital gains, dividends received/rendered are taxable/deductible Discount to NAV approx. 13% AN_Pres_KV308 Nr 3

4 First ten months 2008 in summary Net asset value on October 29 was SEK 64 per share, including reinvested dividends a decrease of 53% since the start of the year. The total return for the Class A shares was -47%, compared with -39% for the return index. Purchase of SEK 1.5 bn of Class A shares in Volvo, after which the ownership amounts to 7.5% of the votes. The purchases were financed by sales of stock. AN_Pres_KV308 Nr 4

5 The reporting period in summary Equities Portfolio Oct 30 Sept 30 Dec. 31 market value, SEK M 35,406 44,408 65,844 Transactions acquisitions, SEK M 3,867 3,775 8,834 sales, SEK M 3,592 3,501 2,124 net, SEK M ,710 Oct SEK per share Sept Dec Debt net debt, SEK M 10,610 10,614 10,951 change in net debt ,408 net debt equity ratio 30.0% 23,9% 16.6% Net asset value net asset value, SEK M 24,540 33,689 54,837 change in NAV* -53% -36% 3% total return index -39% -27% 3% Equities portfolio Net debt Net asset value Discount A-share Discount C-share Discount A/C % 20% 13% % 21% 15% % 26% 22% The stocks total return Class A-share -47% -29% 14% total return index -48% -31% 3% * Change in NAV per Industrivärden share, dividends reinvested. AN_Pres_KV308 Nr 5

6 Financial position Net debt (SEK bn) Net debt equity ratio 15,0 30% 13,0 11,0 9,0 7,0 5,0 3,0 1,0-1,0 30-jun-01 AN_Pres_KV308 Nr 6 30-sep dec mar jun sep dec mar jun sep dec mar jun sep dec mar jun sep dec mar jun sep dec sep dec mar jun sep okt-08 25% 20% 15% 10% 5% 0% 30,0% SEK 10.6 bn

7 Industrivärden s dividend 6 7% 5 6% 4 4.4% 5% 3 4.0% 4% 3% Bonusutdelning dividend Ordinarie Ordinary utdelning dividend Direktavkastning SSEX dividend yield börsen Direktavkastning Dividend yield 2 2% 1 1% 0 0% Dividend: SEK/share Of which ordinary AN_Pres_KV308 Nr 7

8 Development of portfolio companies 9M: 2008 Op. income Δ, % Earn. per Δ, % P/E-ratio Operating Δ, %- Net turnover Δ, % Total return, % SEK M share, SEK (r 12M) margin, % pts SEK M 12 mts 98-08/yr Sandvik 10, , SHB 10, , SSAB 8, , SCA 6, , Ericsson 10, , Volvo 16, , Munters , Höganäs , , , Index AN_Pres_KV308 Nr 8

9 Active ownership strategic activities 07/08 Handelsbanken Greater focus on organic growth outside Sweden Acquisition of a Danish bank with 14 offices New Chairman of the board appointed SSAB Acquisition of IPSCO for SEK 50 bn increases capacity for niche products Divesture of IPSCOs tube business Ericsson Cooperation with ST Microelectronics Several acquisitions in Multimedia unit Structural program aims at cutting overhead by SEK 4 bn Sandvik Several strategic acquisitions SEK 3.6 bn share redemption Structural actions taken in Materials Technology SCA Skanska New business plan with focus on improved operating margins New financial targets set Johan Karlström new CEO Strengthening of brand portfolio through acquisition of P&G s European tissue business Divesture of British corrugated board business New organization with focus on growth in hygiene business Indutrade Continuous acquisitions Foothold gained in the UK through two acquisitions Measurement technology company the biggest acquisition since IPO in 2005 Munters Addition of new product areas through company acquisitions AN_Pres_KV308 Nr 9

10 Good long-term growth in value The average annual excess return for last ten years was 1%-points/year Total return index (Index) Industrivärden share (c) SIX AB Total Return Index (SIXRX) As per September 30, 2008 AN_Pres_KV308 Nr 10

11 Portfolio of quality companies Concentrated portfolio provides focus Industry-leading companies provide favorable future opportunities Substantial ownership positions provide influence Long-term focus enables influence through active ownership Professional organization Proven value creation over many years Depth of knowledge about portfolio companies and their business environments Major experience in strategic company development Lean, effective organization provides speed and flexibility Extensive network a strength Returns from short-term transactions cover Industrivärden s costs First-rate methods and models Own-developed work methods, models and systems vouch for high quality Structured processes for evaluating existing and new investments Proven model for profitable value creation AN_Pres_KV308 Nr 11

12 A portfolio of industry-leading companies Leading metal powder producer 1% or SEK 0.4 bn (2004) Leading player in complex construction projects 6% or SEK 2.1 bn (1987) World leader in moisture control 1% or SEK 0.74bn (2002) Leading producer of heavy vehicles 7% or SEK 2.5 bn (1987) Leading high-tech company in materials technology 19% or SEK 7 bn (1997) Technology trading company active in northern Europe 4% or SEK 1.4 bn (1989) World s largest supplier of systems for mobile telecom 11% or SEK 4 bn (1944) World leading producer of specialty steel 12% or SEK 4 bn (1994) Global consumer products and packaging company 12% or SEK 4 bn (1950) Successful universal bank with international growth based on a Nordic base 27% or SEK 10 bn (1963) Portfolio share and value as per October 29, 2008 (Holding since). AN_Pres_KV308 Nr 12

13 Equities portfolio as per October 30, 2008 Value distribution % of portfolio % of capital % of votes Stock No. shares SEK M SEK/share value in company in company Handelsbanken A Handelsbanken B 67,541, ,900 9, Sandvik 136,931,200 6, SSAB A SSAB B SCA A SCA B 52, ,794 48,600,000 22,200,000 4, , Ericsson A 74,400,00 4, Volvo A Volvo B Skanska A Skanska B 61,578,200 1,350,250 15,010,000 15,314,800 2, , Indutrade 14,757,800 1, Munters 10,950, Höganäs B 3,550, Hemtex 3,700, Total 35, AN_Pres_KV308 Nr 13

14 Industrivärden online Reuters code Bloomberg code Datastream code INDUa.ST INDUA SS W :IU info@industrivarden.se Box 5403, SE Stockholm, Sweden Press release direct: / IR / Ask / Info... / Latest News / Subscribe AN_Pres_KV308 Nr 14