Administration Report

Financial development during the year

Net sales and profit

The AddLife Group’s net sales increased by 52 percent (52) and totalled SEK 7,993 million (5,273). Organic growth was 11 percent (38), acquired growth was 43 percent (17) and exchange rate fluctuations had a negative impact of 2 percent (3), corresponding to SEK 104 million (121).

During the financial year, EBITA increased by 59 percent (163) to SEK 1,273 million (802) and the EBITA margin reached 15.9 percent (15.2). Transaction costs amounting to SEK 32 million and stamp duty of SEK 24 million related to acquired shares is included in the result as sales costs. EBITA excluding acquisition-related costs amounted to SEK 1,329 million with an EBITA margin of 16.6 percent. The higher margin is due to increased volumes and continued restrained costs. xchange rate changes had a negative effect on EBITA of 2 percent (6), corresponding to SEK 16 million (17). 

Net financial expenses was SEK -69 million (-13) and profit after financial items increased by 41 percent to SEK 927 million (659). Profit after tax rose by 39 percent (265) for the financial year to SEK 721 million (520) and the effective tax rate was 22 percent (21). Earnings per share before dilution for the financial year amounted to SEK 6.03 (4.63).

Profitability, financial position and cash flow

Return on equity at the end of the financial year was 22 percent (31). Return on capital employed totalled 31 percent (25). The equity ratio at the close of the financial year was 40 percent (46). Equity per share, excluding non-controlling interests, totalled SEK 35.14 (16.73).

Return on working capital (P/WC) totalled 95 percent (103). The long-term P/WC target for the Group and all of its companies is 45 percent. The profitability benchmark P/WC ratio encourages high operating profit and low levels of tied-up capital. When combined with the growth target of 15 percent, this creates conditions that promote long-term profitable growth for the companies and the Group. Average working capital, which when calculating P/WC includes inventories with the addition of the net of accounts receivable and accounts payable, amounted to SEK 1,347 million (781) at the end of the financial year.

The Group's interest-bearing net debt at the close of the financial year stood at SEK 3,870 million (700), including pension liabilities of SEK 82 million (81), as well as lease liabilities of SEK 339 million (233). The net debt/equity ratio, calculated on the basis of financial net liabilities including provisions for pensions and lease liabilities, totalled 0.9 (0.4).

Cash and cash equivalents, consisting of cash and bank balances together with approved but non-utilised credit facilities, totalled SEK 674 million (1,006) on 31 December 2021. The Group's available credit facilities amounted to SEK 4,083 million (1,492) as of 31 December 2021.

Cash flow from operating activities reached SEK 1,010 million (950) during the financial year. The increase is due to the strong result but is counteracted by large payment of trade payables. Acquisitions of companies amounted to SEK 2,843 million (345). Investments in non-current assets reached SEK 143 million (91) during the financial year. Disposals of non-current assets totalled SEK 9 million (7). Repurchase of treasury shares amounted to SEK 0 million (31). Issued and exercised call options totalled SEK 9 million (58). A dividend of SEK 183 million (56) was paid.

Business areas

AddLife's operations during the financial year were organised in two business areas: Labtech and Medtech.

Labtech

Net sales rose by 21 (62) percent during the financial year  to SEK 4,373 million (3,619). Organic growth was 22 percent, acquired growth was 2 percent and exchange rate fluctuations had a negative impact of 3 percent.  

EBITA rose by 57 percent (187) to SEK 977 million (622) and EBITA margin amounted to 22.3 percent (17.2).

The Labtech business area has undergone strong growth in all geographic markets during the year. The increase for the diagnostics companies is mainly related to sales of certified COVID-19 tests and other tests such as blood gas analysis, used in the hospital ICU units. Research companies have had strong demand for COVID-19 related productsas well as virus research in general. 

Medtech

During the financial year net sales totalled SEK 3,625 million (1,659), an increase of 119 percent (37). Organic growth was 5 percent, acquired growth was 126 percent and exchange rate fluctuations had a positive impact of 1 percent. 

EBITA rose by 58 percent to SEK 310 million (196), corresponding to an EBITA margin of 8.6 percent (11.8).

The strong growth in the Medtech business was mainly driven by the two strategic acquisitions completed in April. The number of elective surgeries has been on a lower level than normal, with lower demand for non-COVID-19 related product as a result.