We shape

the future
for clean air

The Clean Annual and Sustainability

Air Company Report 2022
2  

Contents
CEO’s comments................................................ 4
Strategy................................................................ 24

DIRECTORS’ REPORT
Nederman’s divisions....................................... 44
Sustainability report ....................................... 54
GRI Index .............................................................. 72
Auditor’s limited assurance report
on sustainability report.................................. 73
The Nederman share ...................................... 76
Review of business operations ................... 78
Five-year overview .......................................... 82
Risks and risk management .......................... 84
Corporate governance ................................... 86
Guidelines for executive
remuneration ..................................................... 90
Board of Directors ............................................ 92
Group management ......................................... 93

FINANCIAL STATEMENTS
Consolidated financial statements ........... 94
Notes to the financial statements ............ 98
Parent company's financial statement .... 130
Signatures........................................................... 142
Audit report ........................................................ 143

OTHER
Definitions .......................................................... 148
Articles of Association ................................... 149
Annual General Meeting ................................ 150
Dividend................................................................ 150
Financial calendar............................................. 150

INFORMATION ON DATA IN THIS REPORT

Figures in brackets refer to business activities in 2021
unless otherwise stated. The currency used through-
out is Swedish krona (SEK). Millions of Swedish kronor is
abbreviated to SEKm and thousands of Swedish kronor
to SEKt. The information presented in the Annual
Report concerning markets, competition and future
growth are Nederman’s assessments based primarily
on material compiled internally within the group.

Nederman's sustainability report for 2022 has been

prepared in accordance with GRI Standards, see GRI
index on page 72. The sustainability report, with the
exception of the information according to the EU
taxonomy regulation on page 64, has been reviewed by
Ernst & Young.
    3

World-leading
position for
continued growth
More than 75 years ago, Nederman was already a pioneer within working
environments and clean air. Our determination to address the environmental
challenges of industry through innovative solutions and cost-effective
production has led to continuous expansion and a world-leading position
in industrial air filtration. Today, expansion and value creation is achieved
through digitalisation and servicification, and we are still at the fore-
front of development. This is how Nederman as an environmental
technology company and global leader, creates value and growth
– for our customers, for our operating environment and
for our owners.

We protect people, planet

and production
BETTER AIR QUALITY
Ensuring improved and sustainable
air quality for more people.

BETTER USE OF RESOURCES

Improving utilisation of resources,
achieving more with less.

BETTER WORK ENVIRONMENT

Enhancing product performance,
guaranteeing health and safety.

BETTER COMPANIES
Creating sustainability and climate-
neutral operations.
4   CEO’S COMMENTS

We are growing profitably

and continue to shape
the future for clean air

Important milestones in 2022

Nederman’s journey of success continues. During a particularly challenging year, we further
strengthened our record-level order backlog and reported a strong increase in both sales and
earnings. Investments to increase production efficiency were combined with a continued high
pace of product development. Three acquisitions were completed that strengthen Nederman
in various ways, including the establishment of a leading position in the welding segment in
North America. The outlook for 2023 is uncertain, but we have a high level of readiness to
adapt and adjust our operations and to continue to strengthen our global position in industrial
air filtration.

■ High sales growth and record earnings.

■ Three strategic acquisitions on three different continents.
■ Comprehensive investments in operational efficiency.
■ Launch of new energy-saving customer solutions.
■ Strengthened market positions in new industrial segments.

Performance measures 2022

SEKm 2022 2021 2020
Orders received 5,424.8 4,622.9 3,480.2

Net sales 5,178.9 4,041.8 3,674.8

Adjusted EBITA 566.6 494.6 352.3

Adjusted EBITA margin 10.9% 12.2% 9.6%
Adjusted EBITDA 690.4 605.5 461.2
Adjusted EBITDA margin 13.3% 15.0% 12.6%
Operating profit 480.2 458.9 219.0
Operating margin 9.3% 11.4% 6.0%
Adjusted operating profit 488.6 431.2 295.6
Adjusted operating margin 9.4% 10.7% 8.0%
Profit before tax 438.8 417.1 148.5
Net profit 328.7 305.3 110.4
Earnings per share, SEK 9.37 8.70 3.15
Return on equity 16.8% 20.2% 8.2%
Return on operating capital 15.2% 15.6% 10.4%
Net debt 1,477.1 1,067.8 1,450.5
Net debt/equity ratio 67.6% 62.2% 111.5%
Net debt/adjusted EBITDA, multiple 2.1 1.8 3.1
Interest cover ratio, multiple 7.9 9.6 4.1
 CEO’S COMMENTS   5

Sven Kristensson
President and CEO
6   CEO’S COMMENTS

On Monday, 30 May, I had the honour of opening the photo exhibition, The Breath, in Helsingborg,
a collaboration between Nederman and Dunkers Cultural Centre. Together with one of the partici-
pating photographers, Olof Jarlbro, we talked a little about some of the images displayed in the park
outside the cultural centre. Images in which the photographers were free to interpret “the breath.”
It was fascinating and occasionally eye-opening to regard these observations of one of the most
important things for humans – clean air. What could be found in several of the images, and something
that we often highlight in our own communications, is how few people in the world actually have
access to clean air on a daily basis.

According to the WHO’s new estimates, as much as 99 percent of At the end of the January 2023, I attended another inau-
the Earth’s population breathes polluted air every day. Of course, guration. Once again in Helsingborg, but at another venue and
the situation is worst in many of the densely populated and rapidly something completely different, but just as important. Togeth-
growing developing countries, but Europe and North America also er with representatives from the municipality and construction
have a problem with poor air quality. Industrialisation throughout company, I put the first spade in the ground for Nederman’s new,
the world is, naturally, a reason for the poorer air quality, primar- ultra-modern facility, which will be the new Nederman head office,
ily if manufacturing processes and transport are based on fossil manufacturing and logistics unit for one of our divisions, but also
energy, and in many countries, regulation and supervision of pol- a group-wide innovation and experience centre for the air filtra-
lution are far from optimal. At the same time, the trend cannot be tion solutions of today and the future. This demonstrates our
stopped, the world evolves and more people take the step into ambitions in the area and displays our strong focus on increasing
the welfare society. But this is also accompanied by heightened awareness of the importance of breathing clean air, in all types of
awareness of health and well-being, which in turn, drives change. environments, not least in industry. As the market leader, we are
This is actually occurring most rapidly in industry, with initiatives resolute in driving development in industrial air filtration globally,
including better utilisation of resources and reduced energy con- as The Clean Air Company. This is a long-term effort that builds on a
sumption. New technical solutions, the possibility to digitalise close dialogue with customers in a number of different industries
processes and monitoring, and not least the introduction of smart to find the most effective and profitable solutions. Every industry
systems for analysis and optimisation, also further strengthen the and customer is unique. With their particular challenges. >
prerequisites for clean air in our industrial environments. And at
the forefront of this development is the environmental technol-
“As the market leader, we are resolute
ogy company Nederman.
in driving development in
industrial air filtration globally,
as The Clean Air Company.”

Market trend Sales by region

REGIONS, external sales

Growth
SEKm 2022 2021 2020 2022-2021
AMERICAS 1,782 1,220 1,129 46%
EMEA
APAC
2,316
1,082
2,020
802
1,916
631
15%
35%
34 % 45 % 21%

MAIN MARKETS, external sales

Growth
SEKm 2022 2021 2020 2022-2021
AMERICAS EMEA APAC
USA 1,453 996 883 46% SEK 1,782m SEK 2,316m SEK 1,082m
Germany 414 342 356 21%
China 364 378 307 -4%
India 300 143 78 110%
UK 267 207 184 29%
Sweden 135 126 207 7%
 CEO’S COMMENTS   7

Global divisions with clear customer focus

Nederman is organised in four divisions, based on differences in business logic, customer structure
and technology. The organisation is driven by simplicity and has the group’s brands as its starting
point. This means that the divisions are global and have an explicit focus on the customer.

Nederman Extraction & Filtration Technology Nederman Process Technology

Nederman Extraction & Filtration Technology develops and sells a Nederman Process Technology offers services and advanced
broad range of filters and monitoring services, capturing devices, filter solutions that are integrated into the customers’ production
fans, high-vacuum products and reels for the distribution of a processes where they catch harmful particles and gases.
variety of liquids and compressed air.

SEKm 2022 2021 2020 SEKm 2022 2021 2020

External orders received 2,238 1,781 1,589 External orders received 1,825 1,785 993
Sales 2,165 1,763 1,649 Sales 1,722 1,292 1,137
Adjusted EBITA 357 309 222 Adjusted EBITA 100 51 58
Adjusted EBITA margin 16.5% 17.5% 13.4% Adjusted EBITA margin 5.8% 3.9% 5.1%

Nederman Duct & Filter Technology Nederman Monitoring & Control Technology

Nederman Duct & Filter Technology markets different types of Nederman Monitoring & Control Technology’s digital offering
ducting systems, valves and filter elements to ensure good air includes advanced measurement technology and an IoT platform
quality in a number of industries. that consists of hardware and software that provide customers
with information and insight into critical parameters and processes.

SEKm 2022 2021 2020 SEKm 2022 2021 2020

External orders received 704 495 403 External orders received 657 562 496
Sales 791 541 458 Sales 606 537 507
Adjusted EBITA 127 104 64 Adjusted EBITA 97 121 95
Adjusted EBITA margin 16.1% 19.2% 14.0% Adjusted EBITA margin 15.9% 22.5% 18.7%
8   CEO’S COMMENTS

Acquisitions advance positions

Acquisitions are a key part of Nederman’s strategy to strengthen its positions in prioritised segments, technologies
and markets. During the year, three acquisitions were completed on three continents and of varying sizes, but with the
same ambition – to continue developing our ability to protect people, planet and production from the harmful effects of
industrial processes – and become a global market leader.

Leader in North America

Nederman’s largest and most strategic acquisition in 2022 was con-

ducted in August in the US. This was the Extraction & Filtration
Technology division’s acquisition of the company RoboVent, a North
American leader in air filtration technology and solutions for the
control and filtration of industrial fumes, dust and oil mist. RoboVent
is headquartered in Sterling Heights, Michigan, and has more than 100
employees in the US, Canada and Mexico. Its unique sales approach,
strong equipment range and turnkey capabilities have built a strong
brand and global reputation. Through the acquisition of RoboVent,
Nederman further improves its growth possibilities by becoming the
foremost supplier of industrial air filtration and air filtration in the US
welding market. As the established leader in this segment in Europe,
this means that Nederman also takes a global leading position in the
welding segment, fully in line with the group’s strategy. RoboVent and
the Extraction & Filtration Technology division will have combined sales
of more than SEK 1,000m in North America, which is also a prioritised
market for all divisions to increase their presence. Since RoboVent
became part of Nederman in August, comprehensive cooperation has
been initiated. This comprises activities to further strengthen product
development, investments in increased production and logistics auto-
mation, as well as initiatives to continue development of collective and
leading applications expertise.

“By combining RoboVent’s strengths with Nederman’s global presence,

complimentary products, solutions and digital technology, Nederman
can further strengthen its ability to deliver solutions for clean air in the
industrial segments that the company supplies,” says Hans Dahlén, SVP
& Head of Extraction & Filtration Technology Division.

Strengthened sales channel in Australia Increased presence in Switzerland

Australia is a market in which Nederman foresees favourable growth In November, Nederman acquired the Swiss company MBE AG to
prospects. In April, Nederman, through its Duct & Filter Technology divi- strengthen the Monitoring & Control Technology division and its
sion, acquired the operations of the Australian company Ezi-Duct Pty subsidiary Gasmet’s presence and sales in Switzerland and Europe.
Ltd. Ezi-Duct manufactures and supplies ducting, fume extraction and For more than 35 years, MBE has sold gas measurement instru-
industrial air filtration equipment. Directly after the acquisition, Nord- ments and services for gas detection technology and continuous
fab Australia was formed to organise the assets and employees includ- monitoring of liquid processes to the Swiss market. With its know-
ed in the acquisition with the existing organisation, and to highlight how, market presence and customer base, it has built a strong
even more clearly the ambitions in the Australian market. Since then, brand and a robust market position. For many years, the company
the integration work has progressed at a high pace, with the estab- has been a key distributor for Gasmet, which, as a result of the
lishment of the organisation, joint reporting, training of employees in acquisition, can establish direct sales with the customer base and
air filtration and Nederman’s and Nordfab’s products, coordination of strengthen the conditions for growth in Switzerland. Together,
the websites and adaptation of the product portfolio, not to mention MBE and Gasmet can become even better at meeting the needs of
comprehensive work to install a new ERP system. With an increased the local market for systems for monitoring emissions and continue
awareness that delivery times and transport costs are decisive in the to offer excellent service and aftermarket support.
duct segment, this acquisition contributes to increased market pene-
tration and a possibility to come closer to the customer base. “MBE has been a partner and customer to Gasmet for many years
and I now look forward to jointly developing and strengthening our
“We have achieved a great deal since April and are now seeing the ability to deliver technology and solutions for the monitoring and
results of our customer activities. In the long term, we anticipate being control of gases in the Swiss market,” says Ketil Gorm Paulsen, SVP
able to increase our market shares considerably and also serving as a & Head of the Monitoring & Control Technology Division.
channel for other divisions to grow in Australia,” says Jeppe Rasmussen,
SVP & Head of Duct & Filter Technology Division.
 CEO’S COMMENTS   9

> At the same time, there are shared challenges that we all need to In our own operations, we have naturally placed major focus on
address and these have been plentiful in recent years. The pan- managing all of the challenges. Nederman is a global company that
demic resulted in huge complications for global transport and needs to address and adapt to various local conditions, at the same
supply chains, with accompanying component shortages. Before time as we develop solutions that can be implemented through-
we could find a solution to this, a war on European soil grabbed the out the world in a number of industries. During 2022, our four divi-
world’s focus. With major consequences for energy supply, infla- sions successfully managed component problems and rising raw
tion and security policy. Unfortunately, we are forced to recognise materials and transport costs. We improved efficiency and adapt-
that the world has changed. Globalisation and free trade have ed, even in product development, to be able to keep our promises,
been replaced by regionalism and protectionism. At the same time, namely, deliver. In certain instances, such as in China, where we
we need to continue to address challenges related to the climate already have significant production and many customer relation-
and the environment. On a global scale. ships, the challenges have sometimes been of a slightly different
nature and difficult to address for an international company such

“The result is that Nederman is now as Nederman. We have done what we can, but have also initiated a
review of our operations in the country to strengthen our position.
the leader in the segment in both
Europe and North America and one A completely different trend was displayed by our operations
in North America and it is on this continent that we have made
of the largest globally.” the largest investments and progress during the year. Nederman
Duct & Filter Technology has become an important supplier to the >

SALES GROWTH, % OPERATING MARGIN AND RETURN ON OPERATING CAPITAL, %

ADJUSTED EBITA MARGIN, %
30 14
20
12
20
10 15
10 8
10
6
0
4
5
-10
2

-20 0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022

Justerat EBITA
Annual sales growth over a business cycle is Adjusted EBITA margin is to amount to a minimum The return on operating capital is to be at least
to amount to 10 percent. During 2022, sales of 14Rörelsemarginal
percent. In 2022, the adjusted EBITA margin 15 percent. In 2022, the return was 15.2 percent.
increased by 28.1 percent. Average annual was 10.9 percent. The average for the past five The average annual return during the past five
growth during the past five years was 9.9 years was 10.4 percent. years was 14.4 percent.
percent.

Operating margin
Adjusted EBITA margin

DIVIDEND POLICY, % GHG EMISSIONS* EMPLOYEE ENGAGEMENT, %

IN RELATION TO
SALES, KG CO2e/SEKt

40 5 100

4 80
30

3 60
20
2 40

10
1 20

0 0 0
2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 2019 2020 2021 2022

Dividends are to amount to between 30 and 50 With the goal of halving the climate impact In 2022, 85 percent of all group employees
percent of net profit after tax with consideration measured in carbon dioxide equivalents related to responded to the survey. The overall Engage-
given to the capital structure and acquisition energy use and electricity purchased for the group’s ment Index was 83 (on a scale of 100), which
plans. manufacturing units by 2023, in relation to 2014 is higher than the corresponding index for the
(base year), the outcome for 2022 was 75 percent. comparative groups, Global Benchmark and
In 2023, we will continue to analyse the goals and Industry.
measures to be implemented by 2024.

* Scope 1+2
10   CEO’S COMMENTS

Shuai will strengthen Nederman’s position in China

Shuai was born and grew up in Shandong in China. When the time came for university studies in 2009, she chose Lund, in
Sweden, where she subsequently remained, partly because she was offered a job with Nederman. She has now retur-
ned to China, and is on the threshold of the exciting challenge of helping Nederman to strengthen its position in a mar-
ket with huge needs for clean air solutions.

What do you currently do at Nederman? and to try to find opportunities for Nederman to grow through
Since the beginning of 2022, I have been Director of Business acquisitions, for example. All of this led me to the role that I have
Development for Nederman in China, with my office in Shanghai. today, in which I can benefit from all of the knowledge I have
My work here involves developing the division’s business in direct gathered over the years and I can meet the customers directly in
contact with the customers. It is a gigantic market with intense one of the world’s largest economies. Now, in my daily work, I also
competition, and everything needs to be done with speed. It have the support of all of the colleagues who have the positions I
is this speed in the way business is conducted that stands out held earlier.
compared with Sweden, for example. This is where my other role
comes in, coaching Nederman’s organisation in how best to enter What do you value most about working here?
the Chinese market. Since I was born and raised in China, I have I am proud of what I do. We contribute something important. In
experience that can help me in my various roles. China, I see and read about many places with poor air, which is
what Nederman has the solutions to. It is great to be a part of
Tell us about the journey that brought you here. The Clean Air Company. I also appreciate that Nederman had
After studying economics in Lund, I was ready to apply for a job confidence in me from the start. I have had the privilege of grow-
in 2012. It was difficult. My lack of knowledge of Swedish was a ing with the company and have had managers who have strength-
huge barrier at most of the companies I applied to. But Nederman ened and pushed me.
took a different view and gave me the chance of a position in
Helsingborg. Since then, I have grown within the organisation. With the experience that you have now, what advice
Initially within business support as a business analyst and then as do you have for current and future employees?
a market intelligence manager. I then took on the role of product The best advice I can give is to adopt one of the company’s values
marketing manager and learned about individual products and – Courage to do. I have carried that throughout my journey and it
technical parts, before I was offered the position of M&A manager has resulted in me learning a great deal.

“Nederman took a different view and gave me the

chance of a position in Helsingborg. Since then,
I have grown within the organisation.”
Shuai Liu, Director of Business Development, Shanghai, China

Digitalised monitoring
for lower energy consumption

During 2022, energy was more in focus than it had been for some time.
Since industry needs to be efficient and sustainable, new approaches to
work are required to minimise energy consumption without jeopardising
quality or safety. Studies show that up to 70 percent of the electricity
used in the manufacturing industry goes to industrial motor systems
such as fans, compressors and materials handling equipment. Although
the air filtration plant is production-critical, many businesses do not have
full control over how it should be managed for optimal effect. Active moni-
toring of these processes can prevent problems that not only prevent
efficient operation but also contribute to reducing energy consumption.
The conditions have changed as a result of digitalisation. Among other
things, the Industry Internet of Things (IIoT) enables effective real-time
communication that facilitates increased control. We have developed
Nederman Insight and combined with Nederman SmartFilters, it is
possible to actively monitor various processes and take rapid action in
the event of deviations, also related to energy consumption. The result
is quite simply automated energy savings. During the year, the sale and
launch of energy-saving products and services were further intensified.
 CEO’S COMMENTS   11

Nederman’s LBR SmartFilter and

SAVE technology launched in the US

Nederman’s SmartFilter is a multifunctional air filtration filter that is suitable

for industrial waste, such as fumes, wood shavings and other combusti-
ble dust. In addition to filtering industrial air, it collects data that provides
the user with valuable information on immediate and potential future
maintenance requirements. In the most advanced smart filters, the plant is
steered automatically toward as low energy use as possible using internally
developed algorithms. During 2022, Nederman launched its LBR SmartFilter
and Nederman SAVE for manufacturers of woodworking machines in the US
market in conjunction with the IWF woodworking fair in Atlanta. The Smart-
Filter technology combines the brand’s pioneering Insight IoT (Internet of
Things) platform with Nederman’s reliable and energy-efficient baghouse
technology to create a unique offering that renders customers ready for a
future that is more automated and connected.

Sales of IoT-ready filter systems continue to grow

Each year, Nederman sells and installs a four-figure number of stationary filter systems. In 2021, the
share of IoT-ready systems grew from 23 percent to 40 percent of sales, and during 2022, the share
increased to 77 percent. With higher numbers of digital filter systems, the installed base for sales of
IoT subscriptions and subscription services, such as myAir and MikroPul-Assist, is also growing.

77% 35% 19%

Share with Insight

Sold Nederman Share that is Nederman Share with Nederman
subscription and
stationary filters IoT-ready* Insight subscription**
service agreements***

STATIONARY FILTER IOT-READY FILTER INSIGHT SUBSCRIPTION SERVICE AGREEMENTS

SYSTEMS SYSTEMS Nederman Insight enables Service and spare parts are
The market for filter systems Demand for digital filter process control and monitor- often costly and time-con-
is global and comprises systems is increasing. Digital ing for operational optimi- suming for filter owners.
sales of new systems and the filters are the only possibility sation with lower energy Nederman’s myAir and
replacement and upgrade of to benefit fully from increased costs, increased recycling and MikroPul-Assist subscription
existing filter facilities. Neder- automation and Industry 4.0. guaranteed regulatory com- offering guarantees the cus-
man has significant market Nederman is at the forefront pliance. Nederman’s Insight- tomer maximum availability
shares in all markets. of this development and most ready filters are prepared for and a lower lifecycle cost. The
of its competitors currently customers’ needs and the market is at an early stage,
have no digital filter solutions step to connect a digital filter but the base of digital filters
on the market. to Nederman’s Insight IoT is growing as is interest in
platform is simple. Now or outsourced solutions.
in the future.

* An Insight-ready filter is a stationary filter to which an IOT gateway can be fitted

** Active Insight subscriptions in relation to number of insight enabled filters sold
*** Active Insight subscriptions including service agreements, in relation to number of Insight-enabled filters sold

An Insight-enabled filter is a stationary filter to which an IOT gateway is fitted.

12   CEO’S COMMENTS

The air 99
According to WHO
guidelines, 99 percent
of the Earth’s population

you breathe
lives in areas with poor
air quality.

700,000,000
In seven hundred million sensitive lung sacs (alveoli), the blood absorbs the
oxygen from inhaled air and emits the carbon dioxide that has formed in the
body. Tiny particles from dust, fumes, etc., can get caught and cause damage.
Damage that makes humans sick and shortens life expectancy.

The collective surface of the alveoli Poor air

Poor air contributes

4th
corresponds to half a tennis court
to Alzheimer’s,

100m
Parkinson’s and
2 other dementia
most common
diseases
cause of death
Pulmonary function is a requirement for life and good
quality of life. The lung is divided into lobes. The left lung
has two lobes and the right one has three.

The first breath

Approximately 10 seconds after birth, a human takes its first
breath. Over a lifetime, we inhale ambient air approximately
600 million times.

It’s a
matter of life

15-20 Air pollution

Approximately 8 million people
globally die prematurely due
A large number of different activities in society contribute to the
to air pollution. Approximately
occurrence of air pollutants. They are formed, for example, by
300,000 die prematurely per BREATHS PER MINUTE
combustion or arise in process emissions from industries.
year in the EU. The number of
traffic deaths in the EU is
20,000 per year.

10,000 litres
Largest single health risk
the amount of air we breathe per day
Air pollutants are the single largest health risk worldwide.

55%
The number of prema-
Air quality index (AQI) ture deaths resulting
Did you know that air pollutants are measured using the air quality index from exposure to fine
(AQI). An AQI of more than 100 is about the same as inhaling car exhaust particles is to be more
fumes all day! See the current AQI status on waqi.info than halved in the EU
by 2030.
 CEO’S COMMENTS   13

> manufacturers of lithium ion batteries, a significant and rapidly Our development of technology and new solutions cleans the
growing segment in the US, and soon also in Europe. Nederman air, protects employees and enhances production efficiency for
Monitoring & Control Technology has established good momen- our customers. Helping our customer industries to become more
tum for its process-related operations, driven by such factors as competitive is, of course, at our core, and includes receiving sup-
US investments to reduce dependence on imported energy. To port and tools for analysis and reporting of various emissions data
date, Nederman Process & Technology has a limited portion of its to meet regulations and requirements. Legislation is becoming
operations in North America, but has begun to secure an increas- increasingly strict, which is important if air quality is to improve in
ing number of orders for customised solutions, including for metal society, but at Nederman, we are impatient and can see that much
recycling and in the energy sector. Nederman Extraction & Filtra- more could be done more rapidly. However, I am certain that this
tion Technology, our largest division, became even bigger in 2022 will come, and then the demand for smart, connected and com-
following the acquisition of RoboVent, a North American leader in petitive solutions will gather additional momentum. Development
industrial air filtration in the welding segment. The result is that will be, to some extent, similar to what has occurred in the area
Nederman is now the leader in the segment in both Europe and of climate in recent years. There are strict requirements for the
North America. During the year, we also strengthened our sales collection and reporting of data which, by extension, will serve as
channel in Australia through the acquisition of Ezi-Duct Pty Ltd. support for a company in meeting the definition of a sustainable
To begin with, we will increase our presence in the country using business, which is becoming increasingly important for investors
our ducting systems under the Nordfab brand, part of Nederman and other financiers. At Nederman, we also have intense focus on
Duct & Filter Technology. We also acquired Gasmet’s distributor in these areas. Our sustainable business not only comprises our lead-
Switzerland, making it possible to come into direct contact with ing products, but also operations with high ambitions for ener-
customers in this region and to accelerate the sale of Gasmet’s gy-efficient production and logistics based on renewable energy
technology and solutions for the monitoring and control of gases. and a strong focus on diversity and inclusion. We also stepped up
our ambitions during the year. The investments made and in prog-
The acquisitions are part of our long-term strategy to grow in ress at new plants and warehouse premises are subject to strict
prioritised markets and segments with the objective of becoming requirements to minimise the environmental footprint. Some-
the largest or second largest. Sometimes this involves making a thing that is also gaining ground with us is the installation of solar
small acquisition that can contribute the know-how and technol- panels to increase our green share of energy consumption and to
ogy that is perhaps required to accelerate growth in a particular secure our own energy supply to a greater degree. We were already
industry. A good example of this is the acquisition we made at the far advanced in the area of energy and the target we established
end of 2021 of UK company Energy Save Systems. Close cooper- in 2019 to halve our direct climate impact not later than 2023 has
ation between this company and two of our divisions resulted in already been achieved. We will now establish new ambitious goals
the launch of the Nederman SAVE energy-saving concept for filter for our sustainability work in line with our strategy.
systems during the year. We have always known that the issue of
energy is important for our industrial customers and it has been
“During 2022, we secured a large
one of our focus areas, but naturally, we could not have foreseen
that it would attract such strong attention in 2022 in the wake of number of orders in waste manage-
sharply rising energy prices and concerns about energy shortag- ment, battery production and green
es. But it meant that our new system solution had a particularly
good start. A digital and smart system that contributes to reducing
energy production”
energy consumption for air filtration by up to 70 percent. To begin
with, we are offering the solution to customers in woodworking Another part of our strategy – which is also connected with the
and the reception was very positive. Naturally, a system that gen- green transition that is under way globally – is to grow the share
erates considerably lower energy costs and clean air for employ- of our sales in the relatively new industrial segments that have
ees is important to many people and demonstrates Nederman’s emerged from a growing demand in society for environmental
capacity for innovation and decisiveness. adaptation. For Nederman, this involves an expanded market, in
which we have already noted sales successes with our technical-
The fact that Nederman SAVE is based on sensor technology ly advanced solutions. During 2022, we secured a large number
and digital management is, of course, a natural result of develop- of orders in waste management, battery production and green
ments and needs in the market, as well as Nederman’s focus on energy production. Energy is generated from the incineration of
product development. For a number of years, we have raised the waste, but this is also a source of hazardous air pollution, such as
technology level for industrial air filtration and carried it into the flue gases that need to be managed in a safe manner. High-capaci-
future. Our digital SmartFilters will soon be a standard feature ty batteries are completely necessary if we are to be able to transi-
of many industries and we are constantly developing our digital tion to electrification, and the number of plants that manufacture
offering based on our IoT platform, Nederman Insight. Digital sub- them has multiplied many times over in recent years. The manu-
scription services such as myAir and MikroPul-Assist are increas- facturing process is energy-intense and requires the handling
ingly in demand and we are continuing to make progress in our of metals, flue gases and heat that are a threat to health, and we
efforts to offer customers Clean Air as a Service. The technology have the best solutions for these. Finally, the investments must be
and structures are there already, and we have contracts in place. accelerated in green and renewable energy sources, such as wind
The successive maturity and insight into the benefits among cus- power, where the requirements for cleanliness and precision are
tomers in most industries, and globally, mean that I am convinced extremely high and thus require effective systems that capture
that in the not-too-distant future, a large portion of our business particles and gases from grinding, welding and metalworking. We
will be based on fully digitally controlled air flows. serve all of these segments and this applies to all of our divisions,
which also collaborate to be able to meet customer requirements
in the most effective manner. >
14   CEO’S COMMENTS

Nederman’s sales model – A good mix for increased value generation

39% 43% 18%

Percentage of the group's Percentage of the group's Percentage of the group's

sales 2022 sales 2022 sales 2022

SALES, SEKm SALES, SEKm SALES, SEKm

2022 2,024 2022 2,228 2022 927

2018 1,397 2018 1,516 2018 641
Annual growth (ø) + 10% Annual growth (ø) + 10% Annual growth (ø) + 10%

Product sales Solutions Service and aftermarket

The basis of Nederman’s business. A Resolve complex tasks. Individual Qualified service with a high availability
broad range of standard products that standard products that are assem- to ensure continuous operation without
solve common problems. Sales are made bled together to form small, mid-sized costly interruptions in production.
primarily via distributors and resellers. systems, or large-scale system solutions Sales are conducted through our own
with a high element of customisation. All organisation or via authorised subcon-
sales are conducted through own sales tractors.
organisation.

Nederman ranks highly as a

sustainable investment in Sustainalytics

Nederman works in a goal-oriented and consistent manner with activities and

follow-up of the company’s sustainability work. Accordingly, Nederman is highly
2022
48.5p
ranked by organisations including Sustainalytics (a Morningstar Company), which
is an independent ESG and corporate governance research, ratings and analytics
firm, which supports investors around the world with responsible investment
strategies.

Sustainability rating
Weak: 0-25 points
Medium: 25-50 points
Strong: 50-100 points 2019 2020 2021
41.3p 42.9p 48.2p
sustainalytics.com
Photo: Pax Engström Nyström CEO’S COMMENTS   15

Under the heading “How can Sweden become world-leading in an new sustainable
industrial society?”, Nederman and Dagens industri hosted an investors’ lunch in Stock-
holm at the beginning of November. In front of an audience of nearly a hundred people,
panel debates on current topics were alternated with presentations by Nederman, and
these concluded with lunch.

> The acquisitions, innovations and successes of growing in environment for them. Our new centre in Helsingborg is intended
new industries are among the reasons that Nederman was able to to be a state-of-the-art facility that enables employees of Neder-
report a new record for sales and profit in 2022. Another reason man to learn more about what we can offer global industrial cus-
is that our divisions have quite simply been effective at meeting tomers today and at the same time, continue to develop within,
customer needs, keeping their promises and being proactive and for example, innovation and sustainability. We have eleven other
smart in tackling all challenges. We have captured market shares competence and product development centres throughout the
and have been able to benefit from our ability to grow in existing world and new ones are being added, including in conjunction with
industries using new solutions or bringing existing solutions to acquisitions and establishment in new markets. It is clear that we
adjacent segments and thereby growing our overall market – an intend to retain and strengthen our market leadership.
initiative in addition to our sales successes in critical sectors for
the green transition. For example, Nederman Process Technology It is also important that we contribute to developing solutions
was able to take know-how and solutions developed for its textile that give people around the world the opportunity to breath clean
customers and apply these in nonwoven (hygiene products) and air, also when they are at work. A human inhales approximately
win orders and also contribute to better air in the production of 10,000 litres of air each day and to reduce the probability of being
these products. Another example is Nederman Extraction & Fil- affected by various respiratory diseases, dementia and the risk of
tration Technology, which, with its broad product offering, suc- dying prematurely, the world’s governments must place greater
cessively increased its presence within such areas as the food focus on the air quality in our communities. Greater awareness
industry and the defence industry. These types of initiatives and of health among people, the WHO’s new and alarming report and
activities mean that we can grow more rapidly than the market and the competition for talent are some of the aspects that will turn
that we can drive the development of energy-efficient solutions air quality into an ever-more prioritised issue going forward. The
for clean air for increasing numbers of industries and customers. best thing is that solutions for better air already exist, primari-
ly in industry, and rapid technological development means that
Behind all successes there are skilled people. This applies to our they are becoming accessible to more people, and are improving
operations to the highest degree. It is all of our employees who and becoming increasingly effective. Naturally, we at Nederman
have developed Nederman from a company with a concentrated are playing a part in shaping this positive future for clean air. Our
product portfolio and regional focus to a position with the mar- strategy stands firm and I look forward with confidence to the
ket’s most advanced product and service offering and representa- years ahead with all 2,400 employees who do their utmost every
tion in all key industrial markets. There is incredible talent within day to protect people, planet and production from the damaging
the group, with specialist knowledge in such fields as digitalisa- effect of industrial processes. Take a deep breath and join us on our
tion, mechanics and air filtration, both as strategic resources and continued journey.
driven sales representatives who can quickly identify the custom-
ers’ needs and can adapt solutions for them. We want to continue Sven Kristensson
to develop our talents and, at the same time, be able to attract new President and CEO
ones, and are working conscientiously to be able to create the best
    16

> The Breath was nominated in

February 2023 for the Swedish
Art and Business Award.

The jury includes HRH Prince Carl Philip

and the association's CEO Anders Boman.
The winner will be presented in May.
The Breath
An exhibition initiated by Nederman in collaboration with
Dunkers Culture House in Helsingborg and Curator Veronica Wiman.

We believe that creativity and successful enterprise are closely related. Creativity
provides the ability to address and resolve unforeseen challenges and new needs
created in the market.

Creativity is the key that unlocks the ability to adapt to short and long-term changes, to
constantly evolve and be one step ahead. We have always challenged the market and our
contemporaries and want to be challenging and inspiring. This wish has helped us to become
the company we are today and to be able to address and lead the future we look forward to.
This is one of the reasons that, during the year, we took a leap into the unknown and decided
to invest in something as unusual, for us, as a photo exhibition. A photo exhibition with inter-
national photographers, activists and others in the summer of 2022 in central Helsingborg.

It was a fantastic success. With tens of thousands of visitors, it attracted attention

and generated discussion, reflection and engagement regarding the air that we breathe.

While you read these words, you have taken about 50 breaths. During your life, you will
breath about 600 million times. But clean air is not a given. 99 percent of the world’s popu-
lation breathes poor air according to the WHO and poor air has an enormous impact on our
health and our lives. Clean air requires insight, engagement and action. Accordingly, we have
dedicated ourselves to creating a future for clean air. This is why our employees do their
utmost every day to protect people, planet and production from the damaging effect of
industrial processes.

Nederman - The Clean Air Company

www.thebreath.se

Photographers and participating exhibitors in Nederman’s photo exhibition

Adriane de Souza, Brazil Hans Malmberg, Sweden Naeem Mohaiemen, Bangladesh/USA
Aida Silvestri, USA/Eritrea Jasmin Mittag, Germany Olof Jarlbro, Sweden
Anna Ådahl, Sweden Jonas Classon, Sweden Zena Holloway, UK
Cecilia Germain, Sweden Judit Hersko, USA/Hungary Sophie Green, UK
Fosters + Partners Justyna Mielnikieiwicz, Poland Yan Wang Preston, UK/China
Francois Dolmetsch, Colombia Kseniya Golubovich, Russia/Ukraine
18   CEO’S COMMENTS
 CEO’S COMMENTS   19

THE DIRTY BUSINESS OF GOLD,

PHILIPPINES

Photographer: Olof Jarlbro

The Dirty Business of Gold documents the

everyday life of gold workers in the Philippines.
A unique approach, so-called compressor min-
ing, in which the workers are supplied with air
via a hose and an air compressor in excavated
pits, where the narrow tunnels are at risk of
collapse. In addition, the air compressor can
stop working. Compressor mining also entails
health risks. The diesel generator is next to
the air compressor, meaning that diesel gases
and carbon monoxide are mixed with other
pollutants in the plastic hose that supplies the
diver with air.

www.thebreath.se
20   CEO’S COMMENTS

THE SULFUR CLOUD

Photographer: Olof Jarlbro

In The Sulfur Cloud – photographer Olof Jarlbro

documents the workers at the Kawah Ijen sul-
phur mine in Indonesia. The mine was opened
in 1968 and remains the only sulphur mine
in the world to use manual mining. The toxic
gases from the mining comprise concentrated
sulphur dioxide and hydrogen sulphide that are
40 times higher that the acceptable limits for
human exposure. Constant coughing attacks,
followed by runny noses and eyes, are every-
day occurrences for the workers. The local
population calls it the “world’s most hellish job”
because so many workers die prematurely,
often before they have reached the age of 40.

www.thebreath.se
CEO’S COMMENTS   21
22   CEO’S COMMENTS

INDIAN CORMORANT IN BHARATPUR

Photographer: Jonas Classon

In Bharatpur, in northern India, there are

marshes and wetland interspersed with plains,
offering an optimal environment, where nest-
ing birds live under difficult conditions. The
birds are Indian cormorants that fish early in
the morning and then dry on dead branches.

Air pollution that manifests in thick smog is the

reality in which these birds live. The sun sets
in a heavy smog and sunsets are grey. People
often wear masks to protect themselves from
the toxic air pollution. The contrast between
these birds’ air and the natural conditions for
life are breathtaking.

www.thebreath.se
CEO’S COMMENTS   23
24   STR ATEGY

World-leading
global partner
The production industry the world over is facing a revolutionary challenge – to transi-
tion to long-term, sustainable operations. Environmental technology has a central role
to play when it comes to developing new, advanced solutions to achieve this transition
and thereby ensuring that, together, we manage energy, metals and other production
resources in a manner that entails continued growth and efficient operation, and that
does not jeopardise the future for our shared needs of air, water and land.

Nederman has a key role as the world-leading global partner in industrial air filtration.
We define the market challenges and deliver innovation and more sustainable products
and solutions that meet our customers’ needs.

Environmental technology that contributes to the green transition

Energy efficiency Lower healthcare costs

Energy efficiency is largely generated through techno- Studies indicate a connection between air pollution
logical development. In Sweden, industry accounts for and certain diseases, and with a growing and ageing
approximately one third of total energy consumption population, society’s healthcare costs are becoming a
and a significant share comprises various support pro- heavy burden. Industry’s share has gradually declined
cesses, of which air filtration is one. Increased digital- to approximately 25 percent of today’s emission levels.
isation and automation contribute to more efficient air Improved control and treatment of industry’s emis-
filtration processes. sions to air contribute to reducing the effects.

Increased recycling Productivity gains

To ensure a sustainable global economy moving for- Within the process industry, air filtration is often inte-
ward, a shift towards a more circular economy is grated in the main process, with high demands for
required, with eco-efficient resource management. availability and safety to ensure that production runs
New air filtration technology means increased recy- as efficiently as possible. New possibilities for digitally
cling of, for example, metal shavings, wood fibre and based measurement, monitoring and control not only
paper fibre that reduces the need for the introduction entail cleaner and safer air quality, but also increased
of new material. productivity and production efficiency.
STR ATEGY   25
26   STR ATEGY

Clean air more than a health problem

The struggle for clean air is about having the possibility to breathe healthy air every day. Unfortunately, accord-
ing to the WHO’s guideline limits, this is not the reality for 99 percent of the world’s population. Poor air is one of
the most common causes of premature deaths throughout the world and industry is one of the largest sources of
emissions. At the same time, industry, together with legislators, is the driving force behind several initiatives to
improve the situation. And at the same time, save energy, increase recycling and enhance production efficiency.

Poor air comprises a combination of gases and particles

and is often expressed in the form of PM2.5, meaning 9
particles that are so small that they can pass through a
human lung and thus have consequences that are dam-
aging to health or are deadly. Indoor and outdoor air pol- 7
lution is estimated to contribute to approximately seven
6.5
million premature deaths each year. This corresponds to
nearly 12 percent of all deaths globally. 20% 19% 26% 40% 30% 20% 20%

ASIA WORST AFFECTED

BUT THERE ARE BRIGHTS SPOTS 3.25
Although the facts are gloomy, there are bright spots. 2.5
China, the world’s most populous country and historically
1.5 1.5
one of the largest sources of emissions that is also worst
affected by poor air, is steadily introducing stricter regu-

(COPD)

Chronic obstructive
Ischemic

Lung cancer

Stroke

infections
Lower respiratory tract

Diabetes

Neonatal deaths
pulmonary disease
heart disease

lations with significant improvements as a result.

Since 1990, the EU area’s overall industrial production

increased by 65 percent. At the same time, industry’s
emissions to air are in a downward trend. Intensified
legislation, technical innovations and increased envi- Millions of deaths
ronmental awareness are some of the driving forces Percentage share of deaths due to PM 2.5
behind this. For example, in 2020, the EU launched a new
taxonomy to clarify the importance of environmental
and climate work and to define what is to be considered Sweden China
sustainable. 758 1.8 million

INCREASED PRODUCTION
- REDUCED ENVIRONMENTAL IMPACT
In parallel with tighter regulatory requirements, indus-
try’s own initiatives to ensure environmentally sound
production, better use of resources and reduced energy
use are driving developments forward. Today, it is gener-
ally accepted global practice to include sustainability in a
company’s business model. Contaminated emissions also
often incur a cost for the emitter, which provides further India
incentives to make an active effort for cleaner produc- Number of deaths due to air pollution, 2019 1.7 million
tion.

On account of stricter regulatory requirements, com- 60 2500

bined with, for example, industry initiatives, the emis-
sions trend for polluted air has essentially stagnated, 50 Asia 2300
despite increased production.
40 2100
The demand and need for environmental technology
that resolves the challenges of society and industry are
30 1900
increasing. Within Nederman, we consider it our role to Europe
20 1700
offer solutions and actively inform and exert influence
to ensure that industrial production reduces its share of America
10 1500
emissions. The technology already exists to make it pos-
sible to conduct full-scale industrial production without 0 1300
a negative impact on the environment.
1990 2019

Industrial production index

WHO limits WHO new limit

Sources: Health Effects Institute, State of Global Air 2020; National Geographic Q4, 2021
Sources: Health Effects Institute, State of Global Ai2 2020, Economy facts/Statistics Sweden, 2022
 STR ATEGY   27

WHO halves guideline limits for emissions to air

In September 2021, WHO strengthened its guideline lim- SO WHAT HAPPENS NOW?
its for emissions to air of particles, ozone, nitric oxide and The WHO guidelines are recommendations and not legally binding
sulphur dioxide. The occurrence of particles is often mea- for member states, but are a key driver and represent an import-
sured as PM2.5, which is a mix of particles that are hazard- ant basis for the work to reduce air pollution and at the same time,
ous to health and so small that they can enter the body’s tackle climate change. The legally binding limits in Europe (In Swe-
blood flow and cause heart and lung diseases, including den, Environmental Quality Standards) are now higher than the
lung cancer. According to WHO, the earlier recommenda- WHO recommendations, but can be expected to be adjusted in
tions from 2005 have not achieved sufficient effects to accordance with the new findings.
break the pattern of poor air throughout the world.
HOW IS INDUSTRY AFFECTED?
10% OF SWEDEN’S POPULATION BREATHES POOR AIR There are multiple sources of emissions and work needs to be done
A study by IVL Swedish Environmental Research Institute from in many areas; transport, city planning and energy production, but
2021 identified 6,700 premature deaths annually, and that about industry also contributes to the high concentrations. Intensified
10 percent of Sweden’s population lives in areas where the con- control of emissions from incineration and improved waste man-
centrations of PM2.5 exceed the WHO recommendation. The insti- agement (including increased recycling) are some of the areas in
tute estimates the annual socio-economic costs at SEK 168 billion. which industry can improve. Products and services for such activi-
Particles in the air impact the environment and people more than ties as continuous measurement and automated production mon-
any other pollution. itoring are available for implementation in new or existing installa-
tions. Lack of regularity compliance can lead to penalties or, in the
worst case, closure of production units, with substantial economic
and social consequences.

WHO guideline limits for PM in indoor and outdoor environments, microgramme/m3

New Earlier Change

PM 2.5 Annual average 5 10 -50%

Daily average 15 25 -40%

PM10 Annual average 15 20 -25%

Daily average 45 50 -10%

“We have waited a long-time for new

Would you like to know more?
guideline limits based on current knowl-
edge that has demonstrated that serious
During the year, Nederman, in collabo-
health effects are also present from con-
ration with Dagens Industri, arranged a
centrations permitted under the earlier
well-attended webinar on air pollution
guidelines; concentrations that we also
and the WHO’s new recommendations.
usually have in Sweden. In actual fact, the
WHO recommendation means that even
You can find the webinar here:
the government’s clarification of the environmental target for
fresh air is not sufficient to fully protect the Swedish population,
despite these values being considerably stronger than the cur-
rent Environmental Quality Standards.”

Petter Ljungman
Associate Professor at the Institute of Environmental Medicine,
Karolinska InstitutetSenior Consultant of Cardiology at the
Department of Cardiology, Danderyd Hospital
28   STR ATEGY

Green transition increases

need for Nederman’s solutions
Since the start in 1944, Nederman has evolved into one AGENDA FOR CONTINUED MARKET DEVELOPMENT
of the foremost environmental technology companies Nederman has developed from a company with a concentrated
with a focus on industrial air filtration. We have grown product portfolio and regional focus to today’s position with the
with new products, applications, segments and markets. market’s most advanced product and service offering and repre-
A growing population, consumption, globalisation and sentation in all key industrial markets. Progress is made in accor-
regulatory requirements have driven the market for the dance with a market-driven agenda:
segments we serve, the size of which is currently esti-
mated at approximately EUR 5 billion, with Nederman’s ■ Market-driven organisation
market share estimated at approximately 10 percent. Four global divisions pursued on the basis of the group’s
trademarks and customer focus. Own sales companies in
The global market is growing in pace with more advanced needs approximately 30 countries, and distributors in more than 30
and a greater focus on environmental and health issues. Increased others (2022). A strong local presence is vital when it comes to
industrial production as a result of a growing population with responding to changes in the market and delivering compre-
better economic conditions creates continued general market hensive solutions.
growth. A clearer focus on environmental and health issues with
increased political will to impose demands on the control and tran- ■ Global key customers
sition towards a more streamlined and environmentally friendly Central centres of expertise in combination with local pres-
production industry is impacting the willingness and capacity of ence enable us, in a way that is unique for the industry, to serve
industry to invest in new, effective environmental technology multinational customers in, for example, wind power and
solutions. battery recycling, with everything from centrally developed
technologies and products for local installation, deployment,
FRAGMENTED MARKET AND GLOBAL LEADERSHIP training and service.
The market for industrial air filtration is fragmented and its size
can be estimated on several different levels. For Nederman, it ■ Product development with digital focus
is relevant to define the market on the basis of the product seg- Market-driven product development and utilisation of all
ments and geographical markets that are addressable and profit- opportunities offered by digitalisation – internally and exter-
ably accessible with the current range. nally. Increased digitalisation and automation of products,
process solutions, service and monitoring open new markets.
The relevant market for Nederman amounts to approximately EUR Digitalisation is also accompanied by new business models.
5 billion in annual investments, but inadequate statistics make this
estimate uncertain. While we broaden our product offering, devel- ■ Active acquisition strategy
oping new digital services and strengthening our international Acquisitions have been a key part of the group’s development
presence in new markets, we gain access to a larger market. to effectively establish leading positions within attractive
market or product segments. Size and market penetration give
STRONG TRADEMARKS us a head start in the market that many smaller players find
Nederman addresses the market with a strong portfolio of trade- difficult to challenge.
marks. The strategy is for each individual trademark to give the
group a lead in a well-defined product area, technology or market
segment. In this way, we are able to meet many different customer
requirements and market segments, in both mature markets and
emerging markets.

Product Geographic
Market definitions and estimated sizes segment market

Total market
Global market for products and services in industrial
air filtration.
21 EUR
billion*
All Global

Total addressable market

Total market for products and services in Nederman’s
current segments.
7 EUR
billion*
Addressable Global

Potential addressable market

5
Product segments and geographic markets EUR Addressable Addressable
addressed by Nederman with its current products and billion*
services, and through existing sales and service channels.

*Estimated market value 2019, internal calculations

 STR ATEGY   29

Strong positions in all important markets

AMERICAS EMEA APAC

Number Number Top

2 1 5

34% of the group's sales 2022 45% the group's sales 2022 21% of the group's sales 2022

Sweden Sverige

UK Storbritannien India Indien

US USA Germany Tyskland China Kina

Other AMERICAS
Övriga AMERICAS Other EMEA
Övriga EMEA OtherÖvriga
APAC APAC
0 300 600 900 1200 1500 0 250 500 750 1000 1250 1500 0 300 600 900 1200 1500

Sales per main markets, SEKm Sales per main markets, SEKm Sales per main markets, SEKm

New industries grow rapidly

The need for, and requirements on, clean air are universal for all manufacturing industries. Today, Nederman essentially
serves all industries with generic and customised products and solutions. Meanwhile, new demands for environmental adap-
tation have driven the development of industrial segments, some of which are entirely new. For Nederman, this entails an
expanded market, where we have had major sales successes with our technically advanced solutions.

WASTE-TO-ENERGY BATTERY PRODUCTION WIND POWER

The amounts of waste continue to The need for high-capacity batteries Wind power is progressing robustly and
increase steadily worldwide and place is a key ingredient in the electrifica- the manufacturing process for new
demands on, for example, efficient tion of the vehicle fleet, the increased wind turbines is advanced and places
recycling and the necessary incinera- need for energy storage and the green high demands on cleanliness and preci-
tion of residual waste. The incineration transition of industrial processes. New sion in, for example, grinding of compos-
process is used for energy recovery manufacture and recycling of batteries ites, welding and metalworking, with an
(waste-to-energy), but is also a source is an energy-intensive process that also accompanying set of requirements for a
of air pollution in the form of, for exam- requires the handling of metals, flue clean production environment.
ple, flue gases. gases and heat that are hazardous
to health. Market requirements
Market requirements ■ process control
■ continuous process control Market requirements ■ extraction and filtration of
■ energy recovery ■ energy efficiency process air
■ emissions monitoring in real time
■ materials recycling ■ emissions monitoring
■ emissions monitoring

Environmental, social and economic trends drive development

Greater prosperity, in every sense of the word, demands that higher production capacity. As a direct result, the air in and around
we weigh the environmental impact and use of society’s finite the production environments risks being affected. Nederman’s
resources into our economic models. A growing population will solutions are adapted for Industry 4.0 and aim to minimise nega-
give rise to more consumption and, consequently, demand for tive environmental impact.

Digitalisation Stricter Environmental

Increased consumer Health and
and technological environmental threats and
awareness safety
development legislation resource shortages
30   STR ATEGY

Advance & Connect – strategy for continued growth

For more than 75 years, we have contributed to a better ADVANCE
society by developing products and solutions that pro- The strategy component, Advance, aims to exploit the full poten-
tect not only the industrial production process itself, but tial of our current markets. By continuing to optimise and develop
also the people who participate in it or are affected by it. our current strengths, we can grow from the very core of who we
As a leading player in the world market, we are shaping are and what we do, while gaining a stronger foothold in the mar-
the future for clean air. With a stable foundation, we will kets we know.
take the next step.
CONNECT
Today, the need for more efficient industrial production and Connect involves integrating new opportunities and digital
reduced emissions is more relevant than ever. Nederman’s role is technologies with our current product offering. This allows us to
to develop products, solutions and various types of service offer- extend our core business, explore new markets and offer complete
ings to protect people, planet and production from the harmful solutions to our customers by delivering Clean Air as a Service.
effects of industrial processes. As a leading player in the world
market, we are shaping the future for clean air, and thus contrib- Advance & Connect is the base that enables Nederman to develop
uting to a green transition with a focus on long-term sustainability. its operations towards the goal of global market leadership and is
based on five distinct focus areas:
Nederman’s Advance & Connect strategy combines today’s strong
positions with new opportunities and technologies that will allow ■ Business focus
us to take the next step in shaping the future for clean air. The ■ Operational efficiency
foundation for continued growth is Advance & Connect. ■ Market leading
■ Transformation
■ Globalisation

&
Advance Connect
Exploiting the full potential of our Integrating new opportunities and digital
current markets technologies with our current product
offering. 5
4
3 Globalisation
Expand in customer seg-
2 Transformation
ments and geographic mar-
Develop Nederman
Market leading kets with growth potential.
1 from a product-based
Strengthened market Develop technologies and
Operational engineering company to
positions with the objec- secure knowledge transfer
efficiency an outcome-based envi-
Business focus tive of becoming a global between regions and
Efficient and flexible pro- ronmental technology
Nederman’s business is market leader. Position as divisions, and optimise our
duction. Continuous pro- company.
industrial air filtration. The number 1 or 2 in cultivated supply chain.
continued focus is here, as cess optimisation with the segments and markets.
well as on adjacent market use of economies of scale,
segments. secure supply chains and
digital platforms.

OPERATIONAL EFFICIENCY 2022 MARKET LEADING 2022

New centre for manufacturing, Market leader in the

logistics and innovation in Helsingborg welding segment in the US
The new establishment will result in efficiency enhancements
in manufacturing and logistics and at the same time, reduce the The acquisition of the US company RoboVent means that Nederman
group’s environmental footprint. The investment in test centres and is considerably strengthening its position in North America, where we
innovation hubs will bring competence to such areas as digitalisation, are now the foremost player in the US in industrial air filtration for the
mechanics, dust collection and air filtration. Occupancy 2024. welding segment.
 STR ATEGY   31

The Clean Air Company

Our mission Our promise Our values

We shape the future for clean air We protect people, planet and production from ■ Sustainable customer
the harmful effects of industrial processes. relations
■ Respect for the environment
and each other
■ The courage to act

Manufacturing
BUSINESS MODEL
and assembly
Product Customer and channel engagement
and service Sales
Product & Service
development
Sales model

Operation
Technology
The Clean Business
SUSTAINABILITY & Customer
Air Company concept adaptation FACILITATORS
Data & Analysis

Systems & Technology

Reuse Logistics
Talent & Culture
Use
Operational model and partnership
at customer
Trademarks

Financial objectives Social and environmental goals Development goals

■ 10 percent annual sales growth over ■ Employee engagement in excess of ■ Implement digitalisation strategy
a business cycle benchmark throughout the group
■ 14 percent adjusted EBITA margin ■ Energy: Halve the group’s ■ Integrate all sustainability
■ 15 percent return on climate impact by 2023 activities in the business plan
operating capital ■ Digitalisation: All stationary filters ■ Implement global key
■ Dividend corresponding to 30-50 IoT-ready by 2023 account concept
percent of net profit after tax ■ Sourcing: All suppliers have ■ Increase the customer value
signed the Nederman Code of Conduct in our offering
■ Recycling: 100 percent recyclability of ■ Improve process efficiency
new products throughout the operations

TRANSFORMATION 2022 GLOBALISATION 2022

Nederman SAVE: software and Strengthened position

service package for energy efficiency in expansive Australia
The acquisition of the software developer Energy Save System Ltd at During the year, Nederman acquired the operations of the Australian
the end of 2021 added expertise in the control and management of company Ezi-Duct Pty Ltd, which manufactures and supplies ducting,
filter systems which, for example, reduce energy consumption. During fume extraction and industrial air filtration equipment. This acquisition
the year, the integration of Energy Save System was strengthened, the strengthens Nederman’s position and product range in the Australian
Nederman SAVE energy saving solution for the woodworking industry market.
– which was further developed – was launched, and
customer solutions were sold.
32   STR ATEGY

Air filtration of the future: Digital and servicified

Servicification is one of the key words as the world’s The concept is based on existing and well-proven products. In prin-
industry transitions to increasingly greener production. ciple, the process is generic, but with decisive customer-specific
The winners are those who understand and leverage the application built on initiated know-how of the customer’s individ-
potential in the digitalisation of products and process- ual process.
es. Increased pressure from government agencies and
the capital market have driven developments forward Hardware, combined with advanced software services and signif-
at high pace and the transition requires initial customer icant applications expertise, gives us a unique position in terms of
investments. Nederman is well on its way to complete- benefiting from the opportunities offered by increased servicifi-
ly digitally controlled air flow, with a very high market cation.
potential and new revenue opportunities.
NEDERMAN INSIGHT – DATA-DRIVEN EFFICIENCY
Nederman’s digital market offering now comprises products and In recent years, the need for clean air in industry has focused on
services for the entire air filtration process. With the internally more effective filtration through hardware development, with
developed Insight IoT platform as a base, a market offering is cre- Nederman at the forefront for digital filters. In turn, digitalisation
ated that provides: has led to greater opportunities to monitor and control operation
and improve the possibilities for proactive service and mainte-
■ process control nance work.
■ particle monitoring
■ filtration and extraction The next step comprises data-driven efficiency – mainly driven by
■ emission control demands for increased availability, energy optimisation, resource
use and recycling.
SIGNIFICANT MARKET POTENTIAL
As market leader, Nederman now has expertise, filter systems and The IoT platform Nederman Insight manages a large amount of
solutions in all core industrial markets. Established customer rela- data for process optimisation in real time, but also collects histori-
tionships and existing installations give us a natural advantage cal data that forms the basis for the configuration of new systems
when the customer needs to develop or change the air filtration and processes.
process. The potential for new sales and upgrades of digital prod-
ucts and services is considerable. ECOSYSTEM OF DIGITAL SALES
TOOLS STRENGTHEN EFFICIENCY
The other possibility for increased market shares is to grow the In addition to a digitalised market offering, Nederman also works
addressable market and thus increase the installed base. Many continuously to develop digital tools that strengthen customer
new, rapidly growing industrial branches, such as battery recy- relationships and enhance the efficiency of operations in a number
cling, wind power and waste incineration, largely involve com- of different areas.
pletely new plants, where the customer sees a completely digital
process and outsourced operation, as self-evident. In this respect, Direct sales to end customers are strengthened and streamlined
our complete product programme and high degree of digitalisa- through developed and centralised quotation systems and sys-
tion are a clear competitive advantage. tem configurators, which ensure quality, efficiency and the best
customer solution. For example, new quotation tools, digitalised
NEDERMAN CLEAN AIR CONCEPT quotation processes, system configurator, web optimisation and
- FUTURE-PROOFS AIR FILTRATION CRM are developed.
Nederman Clean Air Concept is the market’s first complete service
concept for industrial air filtration. The model revolves around our In indirect sales via distributors and resellers, increased sales,
Insight IoT platform and is based on the completely decisive option streamlining and improved customer service for resellers are
of being able to measure and collect data from the customer’s pro- created by developing digitalised product information, product
cess. Based on this knowledge, we then have the opportunity to: configurators, digitalised ordering and training. PartnerWebShop/
EDI, the product information system (PIM), nPower training portal
■ clean and extract particles and on-line chat are examples of this.
■ optimise the process
■ validate the process results Further developed and digitalised tools and processes for optimi-
■ report according to regulatory requirements sation and quality assurance also take place within production and
delivery, from ordering to delivery and invoicing, business system
development, ordering via EDI, e-invoices, etc.

Servicification
Expansion potential Expansion potential
Digital products in existing installations through increased
market shares
Service

Spare parts

Further products

Market share
 STR ATEGY   33

Clean Air as a Service

Aside from making it possible to control and optimise industrial airflows with a high level of efficiency,
digitalisation also creates new business models for Nederman. When we can fully measure and con-
trol the customers’ process, we can also offer operation, service and maintenance as an integrated
service. This enables us to offer our customers “clean air” as a subscription service.

Smart Smart Filtration Clean air 

filters connected filters as a service as a service
Product-based offering Solution-based offering Function-based offering Results-based offering

1 1 21 12 32 23 4
3 3 4 4 4

Connectivity
& Service Uptime Compliance
Control systems commitment commitment agreement

Nederman Clean Air Concept

REPORT

VALIDATE

OPTIMISE

EXTRACT
34   STR ATEGY

Continued development toward Clean Air as a Service

Digital filters are a requirement for customers to be DIGITAL FILTER SYSTEMS ARE
able to invest further in the next step of air filtration: ON THE WAY TO BECOMING STANDARD
systems and services for monitoring and process con- Each year, Nederman sells and installs a four-figure number of
trol. During 2022, the sales trend continued and several stationary filter systems. In 2021, the share of IoT-ready sys-
orders were placed for various types of subscription ser- tems grew from 23 percent to 40 percent of sales. During 2022,
vices, and the trend is expected to be even stronger in the trend continued and the share of IoT-ready filter systems
the years to come. grew to 77 percent. With higher numbers of digital filter systems,
the installed base for sales of IoT subscriptions and subscription
services, such as myAir and MikroPul-Assist, is also growing. The
market is thus undergoing significant change and Nederman is at
the forefront.

GOAL 2023

77% 35% 19%

100%
IoT-ready filter systems

OUTCOME 2022

77%
Sold Nederman Share that is Share with Share with Insight
stationary filters Nederman IoT- Nederman subscription
ready* Insight and service
subscription** agreements***

* An Insight-ready filter is a stationary filter to which an IOT gateway can be fitted

** Active Insight subscriptions in relation to number of insight enabled filters sold
*** Active Insight subscriptions including service agreements, in relation to number of Insight-enabled filters sold

An Insight-enabled filter is a stationary filter to which an IOT gateway is fitted

Nederman’s offering is digitalised and servicified

Nederman continues to increase and develop its digitalised customer offering with a higher pro-
portion of connected filters, connected system optimisation, and new sales and the extension of
agreements for connected service monitoring and process control. A further step was taken during
the year and Nederman SAVE – energy optimisation for filter systems – was launched.

Filtration Monitoring Process optimisation

SMARTFILTER NEDERMAN INSIGHT PROCESS CONTROL
IoT-ready stationary filters IoT platform FOR INDUSTRY

SERVICE AGREEMENTS EMISSION CONTROL PROCESS CONTROL

myAir, MikroPul-Assist FOR THE TEXTILE INDUSTRY
Luwa Digi Control 7

NEW NEDERMAN SAVE PARTICLE MONITORING

2022 energy optimisation
for filter systems
 STR ATEGY   35

Nederman “Clean-Air-as-a-Service” (CaaS) guarantees E-MAX maximum operating time

Dutch company E-MAX manufactures and sells aluminium profiles and alu- DIGITALISATION STAGE 1
minium bars with a strong focus on recycling and sustainability. A key part of Following several years of successful cooperation, E-MAX and Nederman
the concept is the company’s smelter in Kerkrade, which each year produces decided to fit the new filter system with digital sensors. The sensors mea-
about 60,000 tonnes of ready-for-delivery aluminium from recycled scrap, sure relevant raw gas data to protect the filter, for example, temperatures,
such as window frames and construction profiles. Nederman has equipped pressure levels and such data as vibrations and the position of rotating or
the filter facility for E-MAX’s new smelter with the latest in digital monitor- movable equipment, to establish the real-time status in order to determine
ing, which guarantees E-MAX maximum operating time and reliable filter wear before it has a negative effect on the filter’s operating time. The
performance. sensors deliver data to Nederman’s IoT Insight hub, where E-MAX’s mainte-
nance team and Nederman’s experts can monitor the process, share data
Aluminium production is extremely energy-intensive and thus has a large and communicate action.
carbon footprint. E-MAX has committed to conducting sustainable alumini-
um production with low carbon emissions and since the smelter in Kerkrade UPTIME COMMITMENT WITH SERVICE AND SPARE PARTS
uses locally recycled scrap, carbon emissions are reduced by 90 percent in With Nederman, which has access to all process data, E-MAX has chosen
the production of recycled aluminium with a low carbon content. to sign a full-range Clean-Air-as-a-Service agreement (CaaS), by which
Nederman’s service team, in close cooperation with the customer, manages
PARALLEL PRODUCTION LINES service, maintenance and spare parts supply for a fixed monthly fee for a
The furnaces are connected to two large Nederman MikroPul FS-filter units. ten-year period. E-MAX is guaranteed operating time for the plant, without
By dividing the filter line into two identical lines, the production level can unscheduled production stops, and can also estimate the operating costs in
be retained, even if a line must be taken out of production for service. The advance.
smelting line is equipped with a Nederman air filtration system that guaran-
tees that the statutory emission levels are not exceeded.

10-year guarantee – with data from Insight

The recycling of aluminium is a harsh industrial process that exposes the

process equipment and the wear parts, including the air filtration system,
to major stresses. Lucky Star, one of the leading aluminium producers in
Qatar, knows this.

Lucky Star is very quality aware and required a ten-year guarantee for the
air filtration equipment, as opposed to the usual 2-3 years, as a basis for
the new cooperation with Nederman MikroPul.

To optimise the air filtration system in the best way and provide a guaran-
tee as requested by Lucky Star, Nederman’s Insight platform was installed
and enables a comprehensive web-based monitoring and data analysis
system. Combined with regularly scheduled physical inspections, this gives
the opportunity to continuously assess the operating condition of the
equipment and the reasons for and status of the wear. In addition to rec-
ommendations for process improvements, the capacity to provide regular
recommendations on the replacement of spare parts and maintenance
activities is decisive for operation that is as devoid of problems and secure
as possible without unscheduled stoppages.
36   STR ATEGY

Energy optimisation with

enormous savings potential
Woodworking is a large industrial sector, mainly in East- control system for these. Nederman SAVE knows which machine
ern Europe. Due to the large amount of air that is man- or part of the machine that is in use and the extraction require-
aged in the dust extraction system, the need for energy ment, and based on this, the entire system is adjusted to minimise
is great, and at today’s prices, the energy issue has made energy consumption. This new system is a much more effective
its way to the boardroom of an increasing numbers of solution compared with a differential pressure monitoring system
producers. At BRW, one of Europe’s largest companies in that is otherwise used in most systems in the market.
the industry, it was decided to minimise the effects, and
Nederman delivered a solution that radically changed WHITE CERTIFICATE REDUCES INVESTMENT COSTS
the situation. The Polish government agencies offer an energy-saving pro-
gramme, by which industries can apply for investment contribu-
The wood industry is important for Poland, with most going on tions to implement energy-saving solutions. An approved White
export, and the plants employ many people, directly and indirectly. certificate cuts the investment bill and makes the investment even
The energy issue has become a problem that threatens prices and more attractive. Nederman SAVE has a built-in reporting function
competitiveness. It is satisfying for us at Nederman to have ready and demonstrates the energy efficiency, making the application
solutions to offer our customers,” says Piotr Krysztofik, CEO of for a White certificate simple. The project starts with an audit
Nederman Poland. of the plant, with proposals for measures, a cost calculation and
theoretical energy saving. After the application is approved, the
NEDERMAN SAVE project moves on to a pilot installation to confirm the calculations
BRW is the woodworking industry leader in Europe. Woodworking before proceeding to full-scale installation.
is a continuous process, often with two or three shifts up to 16
hours a day and energy consumption is a significant cost item. The BRW project commenced with an audit of the plant, with a
proposal of measures for a selected production line. Based on
The filtration plant in Biłgoraj was installed 15 years ago and their measurements from the audit and actual use of the woodwork-
existing control system means it was impossible to adapt the air ing machines, the potential energy savings and investment costs
extraction to the current use of the machines and thereby mini- are calculated for the line reviewed and the entire plant. Energy
mise energy use. It was quite simple for us to resolve this using our consumption and the energy costs enabled a repayment period of
Nederman SAVE energy saving concept, by which we supplement- less than seven months for the investment in the Nederman SAVE
ed the existing equipment with digital sensors, equipped the sys- system.
tem with additional dampers and inverters, as well as an intelligent

Installation
Project start Application design Pilot facility full-scale facility

Application
White certificate Audit Evaluation Commissioning

Four months from start to finish

Nederman SmartFilter
cuts 1/3 of the energy requirement

The choice of filter also clearly impacts the operation’s

energy consumption, costs and environmental impact.
Nederman LCP and MCP SmartFilters yield reduced energy
costs and lower environmental impact

We based the example below on a filter application that is

common throughout the world and compared Nederman’s
LCP or MCP SmartFilter with a corresponding filter solution
in the market.
 STR ATEGY   37

SAVE SAVES AS MUCH AS 70% OF ENERGY

The result is astonishing and demonstrates an enormous poten-
tial from digitalisation alone, with the support of complex algo-
rithms that cover industrial production processes. Alongside of
this, there are several other benefits of Nederman SAVE, accord-
ing to Piotr Krysztofik:

■ guaranteed uptime
■ preventive maintenance
■ simple calibration and adaptation of the system
after replacement of machines
■ use of surplus capacity in the system
to connect further machines
■ more efficient staffing and use of resources
■ increased explosion safety (ATEX)
■ continuous filter optimisation with lower wear
■ remote monitoring/data collection
■ improved reporting

BRW is only one of many businesses in the woodworking segment

that are now reviewing their energy situation. In the same indus-
try, there is, for example, the well-known company IKEA and in
welding and smelters, for example, there are many players facing
the same challenges. We know that we can offer market-leading
solutions and 2023 looks like being a real breakthrough year for
our energy-saving solutions, Piotr Krysztofik concludes.
Piotr Krysztofik
CEO Nederman Poland

NEDERMAN SAVE ENERGY OPTIMISATION

■ Nederman SAVE software
■ 16 SAVER Boxes
■ 64 sensors
■ inverter/speed control
■ control damper
■ Nordfab duct inlet

Nm3/h Tonnes CO2

35
ENERGY SAVING SAVING CO2 PER
100000
PER FILTER FILTER 30
AND YEAR
80000 25

60000
20

30
33%
15
40000 tonnes
CO2 over 10

20000 20 years
5

0 0
1 5 10 15 20 Years
Nederman Filters on the market
38   STR ATEGY

Investments in efficient production and logistics

Nederman’s global presence places demands on high effi- focus on continuous improvements and reinforcing resources in
ciency and reliability in all production-related areas of all divisions.
operation. Due to strong demand during 2022 and contin-
ued healthy growth prospects, we increased our invest- FOCUS AREAS
ments in more sustainable production and logistics. Sourcing
An overall goal is to secure supply chains on all continents where
CONTINUED CHALLENGES we operate. The focus is on our main materials areas of steel (avail-
After a strong pandemic-related decline in demand during 2020, ability and price volatility), semi-conductors (dependent on small
an equally strong upturn followed in 2021, but with new challeng- number of manufacturers) as well as motors and unique compo-
es as a result: component shortages, freight problems and price nents necessary for our products.
adjustments that complicated the supply chain, with longer deliv-
ery times and rising prices. Demand continued its strong trend Production and Logistics
during 2022, but many challenges remained in the market. This Optimise the group’s global industrial climate impact, while
was at the same time as the geopolitical unrest, mainly connect- securing global availability and quality, as well as optimising cost,
ed with the war in Ukraine, further complicated the supply chain in as goals. Such factors as increased volatility in the global freight
the form of rising energy prices and increased risk of energy short- market impact supply and cost. Nederman continuously reviews
ages. Overall developments have also led to inflation taking hold and adapts the group’s supply strategies to optimise costs and
throughout the economy and has led to rapid interest rate hikes availability.
by the world’s central banks. In this macro environment, Nederman
was early in adapting and developing its supplier and production As part of developing a culture of customer focus and efficiency,
organisation to meet the customers’ needs for secure and reli- we have strengthened the work to measure, follow up and contin-
able deliveries, for example by investing in extended capacity and uously improve activities in the Operations area of all units.
increased automation. Another success factor is our strategy of
regionally adapted production close to the customer, which gen- Sustainability
erates reliable supplies and a competitive offering. Within product development, there is particular focus on analys-
ing the current product offering to determine energy use in opera-
GROUP-WIDE STRATEGIES tion, at the same time as new products are to be designed with the
Nederman’s four divisions are active in markets with partly sepa- lowest possible energy consumption as the goal. Increased modu-
rate business logics and thereby differences in their supply chains. larisation and a reduction in the number of components are other
This requires that we manage the supply of materials and produc- areas where projects are in progress aimed at reducing the group’s
tion based on each division’s profile, at the same time as we try to environmental impact.
develop synergies wherever possible. The emphasis is on the need
for a strong and reliable supply chain. Shared principles are:

■ Final assembly close to the customer – creates increased

availability.
■ Vertical integration and increased insourcing – reduces
the dependence on external suppliers and shipments and
increases Nederman’s value creation in the value chain.
■ Classification of inventory and selectively adapted inventory
levels closer to the customer market – yields shorter and more
reliable customer deliveries.
■ Alternative supply chains – increase reliability and reduce
delivery times.
■ Partnership with key suppliers for more reliable delivery
and more efficient product development
■ Greater digitalisation – increases reliability and efficiency

MORE EFFICIENT, CLEARER, STRONGER ORGANISATION

With operations in approximately 30 markets and production and
assembly units in 13 countries, there is already a need for clear
coordination. An improved supply chain and a manufacturing
process based on streamlined processes and economies of scale
reduce production costs and generate cost advantages. Group-
wide platforms for automation and energy optimisation have
been established to serve all divisions. Our organisation for Com-
bustible Dust supports further skills development in this area,
which is important for the group and its customers. In the areas
of Sourcing as well as Production and logistics, there is a strong
 STR ATEGY   39

Key activities 2022

Nederman Extraction & Filtration Technology Nederman Process Technology

■ Preparation of improved plant layout in Poland. ■ Installation of an 16-tonne crane at the unit in Friesenheim.
■ Investment in paintwork line with new paintwork technology in Poland. ■ Expanded supply chain in India for CS and FS filters.
■ Planning for new, ultra-modern production and logistics plant in Sweden. ■ Installation of an integrated fire alarm system for the units
■ Implementation of ERP system in our production facility in Poland. in Friesenheim.

Nederman Duct & Filter Technology Nederman Monitoring & Control Technology

■ Production start for automated duct lasers with robot handling of ■ Changes in product design to offset challenges in the supply chain
finished ducts in Nordfab EU, Assens Denmark. and components shortages.
■ Construction start for expansion of the finished goods warehouse in ■ Increased production efficiency and throughput in all business units.
Nordfab US, Thomasville. ■ Strengthened service organisation and structure for Neo Monitors’
■ Doubled capacity – investment in semi-automatic flanging machine, operations in the US.
remodelling of warehouse with expanded storage spaces in Nordfab
UK, Leeds.
■ Upgrade of machine park for higher efficiency, reduced maintenance
and minimised operational outages in Nordfab Thailand.

Manufacturing and assembly units Competence and product development centres

Australia / Melbourne Extraction & Filtration Technology Denmark / Assens Duct & Filter Technology
Australia / Melbourne Duct & Filter Technology Finland / Helsinki Monitoring & Control Technology
Brazil / Sao Paulo Extraction & Filtration Technology China / Shanghai Extraction & Filtration Technology
Denmark / Assens Duct & Filter Technology Norway / Oslo Monitoring & Control Technology
Finland / Helsinki Monitoring & Control Technology Poland / Marki Extraction & Filtration Technology
India / Bangalore Process Technology Sweden / Helsingborg Extraction & Filtration Technology
China / Shanghai Extraction & Filtration Technology Switzerland / Uster Process Technology
China / Shanghai Process Technology USA / Boston Monitoring & Control Technology
China / Suzhou Process Technology USA / Charlotte Extraction & Filtration Technology
Norway / Oslo Monitoring & Control Technology USA / Charlotte Process Technology
Poland / Marki Extraction & Filtration Technology USA / Detroit Extraction & Filtration Technology
UK / Kettering Extraction & Filtration Technology USA / Thomasville Duct & Filter Technology
UK/ Leeds Duct & Filter Technology
Sweden / Helsingborg Extraction & Filtration Technology
Sweden / Töredal Extraction & Filtration Technology
Thailand / Chonburi Duct & Filter Technology
Extraction & Filtration Technology
Germany / Friesenheim Process Technology
Process Technology
USA / Boston Monitoring & Control Technology
Duct & Filter Technology
USA / Charlotte Extraction & Filtration Technology
Monitoring & Control Technology
USA / Detroit Extraction & Filtration Technology
USA / Thomasville Duct & Filter Technology
Competence and product development centre
USA / Trenton Duct & Filter Technology
40   STR ATEGY

New unit for manufacturing, testing and experience in Helsingborg

In the autumn of 2022, work commenced on Nederman’s Directly adjacent to the test centre, there will be the establish-
new manufacturing and logistics facility in Helsingborg, ment of the Nederman Experience Center, an ultra-modern and
and the establishment of an innovation hub, with a global interactive experience centre, where Nederman’s products and
innovation, development and testing centre (Nederman solutions and the company’s competence and experience will be
IDT Center) and an experience centre (Nederman Experi- demonstrated. The Nederman group’s Clean Air Concept, includ-
ence Center). ing products, solutions and IoT offering, will be showcased using
physical products and digital solutions, as well as the possibility
In addition to a robustly strengthened manufacturing unit, the of remote connectivity. The experience centre will be a vibrant
new Nederman IDT Center comprises a group-wide innovation meeting place for events in innovation and sustainability, cus-
centre with a focus on product development and innovation for tomer meetings, training and much more. The general purpose is
industrial air filtration. Competence and resources will be added in to enhance insight into why clean air is important and to show the
such areas as digitalisation, mechanics, dust extraction, analysis offering of Nederman’s comprehensive solutions for industrial air
and energy optimisation. The aim is also to contribute to collab- filtration, which contribute to protecting people, planet and pro-
oration and knowledge-sharing between the region’s innova- duction throughout the world.
tion-oriented companies, engineers and universities. Part of the
investment comprises a new group-wide test centre to further “ Our new Experience Center provides us with a
strengthen Nederman’s test capacity and position within, for fantastic opportunity to create something beyond
example, air filtration, dust extraction, oil mist filtration and digital
a traditional showroom. It is to be an informative,
technologies for process control and emissions monitoring. The
creative and social place, where we can collaborate
centre comprises indoor and outdoor test spaces, laboratories
for full-scale testing and a prototype workshop where ideas and to shape the future for clean air.”
products can be tested at an early stage and evaluated. The objec- Anki Leeman, head of Nederman Experience Center,
tive is to ensure the products’ performance, efficient product Marketing Manager Extraction & Filtration Technology.
development and recyclable materials choices, as well as a shorter
Overall, the establishment of a new manufacturing unit, Neder-
time-to-market.
man IDT Center and Nederman Experience Center will contribute
to Nederman standing strong in its development and positioning.
“ Through this investment, we are enhancing the Occupancy is scheduled for summer 2024.
efficiency of product development within all of the
group’s areas – a future-proofing of Nederman’s
position in the global industrial air filtration market.”
Dan Rousseau, Director of Filtration Innovation.
 STR ATEGY   41

Current plant and warehouse premises

New car park

Extension

Solar panels in investment for more rapid deliveries in the US

When one of Nederman’s large plants in the US needed to be “To me, it is natural to invest in an already successful
expanded, the decision was taken to combine this with an invest- operation to continue its positive trajectory with
ment in clean energy. The result is more efficient production, fast- superior customer service, while at the same time,
er and more reliable deliveries to customers, a better work envi-
reducing our CO2emissions”
ronment and not least, positive climate effects.
Jeppe Rasmussen, SVP & Head of Division Duct & Filter
Technology.
In the US, Nordfab, part of the Duct & Filter Technology division,
has a production plant of approximately 10,000 square metres in
Thomasville, North Carolina. The strong demand in recent years The solar panels on the roof will produce approximately 1,400
led to the operation outgrowing its premises, which led to deliv- megawatt hours of electricity per year, which covers about half of
ery problems and thus reduced growth possibilities. For example, the anticipated energy consumption for the plant. This will reduce
the warehouse was too small in relation to the production volume, Nordfab’s carbon footprint by 1,004 tonnes, corresponding to the
while the limited manufacturing space resulted in disruption to energy to meet the needs of 121 homes for a year. Climate impact
production. is also becoming such a significant issue because current energy
sources mainly comprise coal.
Accordingly, Nederman is investing in an extended warehouse
and more space for more efficient and reliable production. The “We not only sell a duct product that is easy to be
investment project contributes to the division’s vision, Nordfab re-used, but we will now also produce it much more
Now®, with next-day delivery of standard duct systems in dust
sustainably.”
extraction systems. To a greater extent, products manufactured
Jeppe Rasmussen.
will go directly to inventory instead of directly to the customer.
In total, the investment entails that the floor area will increase to
17,000 m2. In addition, the rooftop space of new and existing build- Construction commenced in April 2022 and the new building is
ings will be used for the installation of 10,000 m2 of solar panels. expected to be in full use during the spring of 2023.
The combination of Nordfab Now® and the award-winning design
software, Quick-Fit Visual®, will contribute to a broadened market
offering and a strengthened position for Nordfab.
42   STR ATEGY

Supplying clean and safe

air to vehicle workshops

Mercedes-Benz is one of the largest manu-

facturers of premium cars and the world’s
largest manufacturer of commercial
vehicles. To ensure a safe work environ-
ment for its employees, improve produc-
tivity and create a cleaner environment,
Mercedes-Benz Turkey chose to install
Nederman’s system for exhaust hose
reels in its workshops. Without a proper
exhaust system, employees are exposed to
dangerous health risks as they risk inhaling
harmful gases such as carbon monoxide,
carbon dioxide and nitrogen oxide. Neder-
man’s system is easy to manage and entails
extraction at source, the most effective
method of capturing and removing vehicle
exhaust fumes and to create a clean, safe
and healthy environment.

Complete solution for Launch of portable dust collector

measurement and dust control and fume extractor with new technology

The world’s largest supplier of car batteries, Johnson Controls, has more Nederman has updated its portable dust collector and fume extractor
than a century of tradition of producing batteries, with a strong focus with an optimised nanofibre filter and ePTFE technology. Airborne
on health and safety in its production. dust and fumes are generated in most industrial processes and affect
both the production and the people who work there. To protect people
Johnson Controls do Brasil, located in Sorocaba - SP, contacted Neder- and production, it is important to have a robust dust collector or fume
man in search of a new solution for cleaning on their production line. The extractor that removes the pollutant at source before it reaches the
main aim was to replace the old cleaning method that was employed, worker’s breathing zone. In many workshops, a mobile unit is the best
with portable vacuum cleaners, brooms and scrapers which, apart from and most flexible choice. With the updated nanofibre and the ePTFE
being time-consuming, involve the risk that employees will come into technology’s filter media in Nederman’s mobile dust and fume extractor,
contact with hazardous substances. Nederman installed a centralised the mobile units are now more effective than ever. It provides cleaner
system for cleaning, including the measurement of particles released air with reduced emissions and a healthier work environment. The
into the atmosphere, which meets the high levels of demand applied optimised filter technology generates even higher efficiency and cost-
by Brazilian legislation to this type of business. Approximately 120 savings thanks to longer filter life and reduced energy consumption,
tonnes of lead oxides are used in manufacturing each day and dirt is as well as higher productivity due to longer cleaning intervals and
unavoidable. With Nederman’s system, employees’ contact with dust shorter downtime.
is eliminated. Nederman was the only company that offered a complete
solution that meets Johnson Controls’ requirements, including design,
installation, guarantee, maintenance service and spare parts – all local,
which contributed to the decision.

Ensuring environmental responsibility and productivity

Gasmet is world-leading in system solutions for continuous emissions moni- This also means that a small excess emission could cause major problems for
toring and where the latest technology is always used. One plant that has had the company. The Gasmet system meets the requirements and offers, for
major success with Gasmet’s system is the HanWha solutions plant in Yeosu, example, the most precise readings available in the market. HanWha installed
Korea. HanWha is a major Korean chemicals manufacturer with a strong com- the advanced multi-component CEMS II e FTIR system, which is particularly
mitment to more sustainable solutions. They are involved in the manufacture modular and can be upgraded for future needs, including a system for mercu-
of many green technologies, such as solar panels, high-quality batteries for ry monitoring and continuous dioxin sampling. If regulations are changed, it
electric vehicles and high-strength, ultra-light materials for cars. is possible to simply add more measured gas components or to change their
ranges, thereby creating reliability and securing the plant’s productivity.
HanWha’s earlier system could not keep pace with the plant’s increasing Gasmet’s combination of global know-how and local support was another
needs and the adaptation to new legislation. Furthermore, in Korea, all emis- factor that contributed to the successful cooperation.
sions from industry are also monitored in real time by government agencies.
STR ATEGY   43
44   DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS
 DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS   45

Nederman’s
divisions
Nederman is organised in four divisions, based on differences in business logic,
customer structure and technology. The organisation is driven by simplicity and
has the group’s brands as its starting point. The operating segments are global and
have an explicit focus on the customer. The year was characterised by continued
recovery of demand and healthy profitability, but also by challenges in the supply
chain, rising energy prices and strong inflationary pressure.

Nederman Extraction Nederman Process Nederman Duct Nederman Monitoring

& Filtration Technology Technology & Filter Technology & Control Technology

Develops and sells a broad range Offers process equipment, filter Markets and sells different types Offers advanced measurement
of filters and digital monitoring solutions and digital services of ducting systems, valves and technology for gases and dust,
services, capturing devices, fans, that are integrated into the cus- filter elements to ensure good air and an IoT platform that provides
high-vacuum products and reels tomers’ production processes, quality in a number of industries. customers with information and
for the distribution of a variety of where they capture and measure insight into critical parameters
liquids and compressed air. harmful particles and gases. and processes.
46   DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS

Division
Nederman Extraction
& Filtration Technology

Market position Customers Offering

Sales are conducted globally through our own Customers comprise industries and operations The division offers its customers clean air opti-
sales companies and through an extensive with air contamination that must be managed mised in terms of energy, process efficiency,
network of partners. The division has signif- effectively and safely, including metal working, health and safety, while ensuring regulatory
icant aftermarket sales in the form of spare fibre-based industry (wood and composites), compliance. The products comprise a broad
parts and service. The sales organisation and vehicle workshops and industries exposed to assortment of capturing devices, digital IoT-
offerings are gradually being expanded into dust particles that – if not handled correctly – based monitoring systems, ducting systems,
new markets, segments and applications in are liable to cause explosions and could lead to fans, high-vacuum and low-vacuum filters,
order to strengthen competitiveness. Tougher diseases and premature death if they enter the and reels for the distribution of a variety of
regulatory requirements and increased envi- lungs and bloodstream. liquids or compressed air. Digitalisation enables
ronmental awareness drive the demand for an advanced service offering and increased
new products and solutions. aftermarket sales.

EXTRACTION & FILTRATION TECHNOLOGY IN BRIEF External sales by region

Head of Division: Hans Dahlén

Brands: Nederman, RoboVent
Average number of employees: 946

SEKm 2022 2021 2020 AMERICAS EMEA APAC

External orders received 2,238 1,781 1,589
Sales 2,165 1,763 1,649
30% 59% 11%
Adjusted EBITA 357 309 222
Adjusted EBITA margin 16.5% 17.5% 13.4%
 DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS   47

Key acquisition and new market concept

It was another good year for Nederman Extraction & Fil- the division’s webshop, reported continued positive develop-
tration Technology. Sales and orders received increased ment. During the year, the division continued to roll out its web-
to new record levels at the same time as the division shop to increase efficiency and accessibility (“Easy to do business
made a major strategic acquisition, launched a new mar- with”), including to a number of partners in five countries in Asia.
ket concept and secured large orders from new customer Performance in APAC was otherwise negatively impacted by the
industries. extensive covid-19-related lockdowns in China, which continued
for a large part of the year. Other markets in the region displayed
To be better able to present the various benefits of the healthy growth, particularly in Australia.
division’s offering, a new concept, Clean Air Optimised,
was launched during the year. This communicates that the divi-
“ Green industries’ share of the
sion offers solutions for clean air in various environments that
also optimise the conditions for employees’ health and safety, division’s exposure has increased
fulfil various laws and regulations, and offer the highest pro- considerably”
cess and energy efficiency. Solutions that contribute to keep-
ing down energy consumption have attracted great attention Hans Dahlén, Head of Division
during the year against a background of large hikes in energy
and electricity prices. Based on technology from Energy Save Digitalisation is a natural part of the offering, including the divi-
System, acquired in 2021, combined with existing filter systems, sion’s new concept, Clean Air Optimised. Digitalisation in the prod-
the division can now offer a system solution under than name of uct development area continued and the launch of digital filters
Nederman SAVE, which can cut energy consumption by as much as with complementary IoT hardware and subscription services, such
70 percent compared with conventional systems. as myAir, is central to retaining strong positions in EMEA and to be
able to grow more rapidly in the US, among other countries. During
Another important event during the year that strengthens the the year, LBR SmartFilters were launched in North America. There
division’s position was the acquisition of US company RoboVent, was also an upgrade of the division’s Insight solutions, which
a North American leader in air filtration technology and solutions includes digital monitoring, with launches in several markets.
for the control and filtration of industrial fumes, dust and oil mist.
Through this acquisition, the division significantly strengthens The business was affected to a certain extent by problems in the
its position in North America by becoming the foremost player in logistics chain, mainly related to purchasing of electronics, and by
the US in industrial air filtration in the welding segment. Welding rising prices of raw materials and the general increase in inflation
is a traditional key application for the division’s offering, where it in the economy. During the year, actions to optimise the logistical
already has a leading position in Europe and becomes global leader and manufacturing structure continued, and, for example, con-
through the acquisition of RoboVent. struction of a completely new site commenced in Helsingborg.
This will create a more rapid logistics flow, strengthen production
Although the division generally reported healthy growth, the capacity and drive innovation. Read more on page 40.
trend in service and aftermarket stands out and encompassed all
regions. The division broadened the offering in various application SALES OCH MARKET TREND
areas and built strong loyalty among customers using different The division’s orders received increased currency neutrally by 18.7
initiatives. The long-term ambition is to continue increasing the percent to SEK 2,238m (1,781) and sales increased currency neu-
segment’s share of the division’s total sales, contributing to a more trally by 16.0 percent to SEK 2,165m (1,763). All regions and sales
stable sales trend over time and higher profitability since service areas displayed growth during the year, with the strongest trend
often has higher margins. in the Americas. The division’s sales in Service and aftermarket
were strengthened in all regions.
The market sentiment has changed. The formerly consumer-driv-
en growth declined, which affects demand in the wood products MILESTONES IN 2022
industry, to which the division has large exposure. The continued ■ Continued strong performance for sales and orders received.
problems in the automotive industry also impacted demand for ■ Acquisition of RoboVent, North American leader in air filtration
the division’s solutions. To address this development, the division technology for welding.
increased its sales activities targetting other industries. During the ■ Launch of the new Clean Air Optimised market concept.
year, orders were secured within the food industry, recycling, the ■ Launch of Nederman SAVE, energy optimisation for filter
energy sector, the defence industry and not least, in operations systems.
connected with electrification. So-called green industries’ share of ■ Construction commenced of a new production and logistics
the division’s exposure increased considerably during the year and facility in Helsingborg.
this is a trend that is expected to continue in the coming years. ■ Several large orders in green industries and the defence
and energy sector.
At the same time as the division noted a record in the number of ■ Strong development within service and aftermarket.
orders, the basic business of product sales through, for example,
48   DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS

Division
Nederman
Process Technology

Market position Customers Offering

The customer base mainly comprises large The customers comprise companies in a large The division’s solutions comprise an integrated
multinational companies that are integrating number of industries, of which the textile part of the customer’s manufacturing process
and optimising the efficiency of their global industry is the largest. The division also offers and are decisive in creating safe work environ-
production operations, which increases the air filtration solutions used in metal recycling ments, stable production conditions and man-
need for suppliers that can provide services for to leading companies active in the recycling of aging emissions to the local environment. The
the entire life cycle of the product in all parts lead, aluminium, tin and other metals, as well as offering comprises advanced filter solutions
of the world. All of the division’s systems can for incineration and heat recovery. Foundries that also include hardware and software, as
be delivered with the option of remote control and smelters, with the automotive industry as well as digital monitoring and control.
and monitoring which, in combination with our the engine, are another key segment, as well as
service offering, enables us to establish a long- the chemicals industry.
term relationship with our customers.

PROCESS TECHNOLOGY IN BRIEF External sales by region

Head of Division: Tomas Hagström

Brands: MikroPul, Luwa, Pneumafil, LCI
Average number of employees: 734

SEKm 2022 2021 2020 AMERICAS EMEA APAC

External orders received 1,825 1,785 993
Sales 1,722 1,292 1,137
22% 42% 36%
Adjusted EBITA 100 51 58
Adjusted EBITA margin 5.8% 3.9% 5.1%
 DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS   49

Delivery on a record order backlog

With strong support from a record order backlog, the divi- systems around the world. The service operations grew strongly
sion achieved new successes in 2022. Sales and profit- and the division had success with its advanced service offerings
ability improved considerably and cash flow was strong, and sold more long-term service contracts, including remote mon-
at the same time as the division was successful in grow- itoring and IoT solutions that contribute to new, more advanced
ing in both new segments and in new markets. business models. The “Clean Air as a Service” offering reached a
breakthrough, with several projects sold during the year.
The strong orders received in recent years, which encompassed all
of the division’s segments and all of its markets, apart from China, The division continued to integrate its operations globally and in
have generated steadily higher sales and profitability. During the the various regions, through digital work and collaboration. The
year, certain challenges remained in the supply chain for key com- focus was also on coordinating purchasing by using its global
ponents, which increased the complexity of the implementation strength to reduce costs and localise purchasing of certain items.
of projects, as well as costs. Despite these challenges, the division The goal is to integrate various activities to achieve a critical mass
was able to deliver on all of its projects in line with or in excess of within all functions, which contributes to lower costs and higher
the budgeted margins. In addition, the division managed process- efficiency. The result will be continuous improvements to process-
es effectively and generated strong cash flow, while also success- es and quality.
fully implementing price initiatives to offset inflation and other
price increases. There was also strong performance by the division’s fibre opera-
tions. The textile segment continued to perform well, driven by
The division’s ambition is to be either largest or second largest increased market shares and a recovery in demand after several
in a market to achieve critical mass in all functions and thus be years of the pandemic. The division’s operations in the adjacent
able to generate sustainable profit. Progress in the division’s non-woven (hygiene) segment displayed significant growth,
globalisation effort was made during the year with the launch including by way of a breakthrough order from a company in the US
of solutions in new geographic markets and use of technology in active in the hygiene sector. In the foundry and smelter segment,
new applications. The division has, for example, a worldleading the focus on more sustainable production is contributing to a long-
position in the textile industry and has seen growing successes term increase in demand for the division’s solutions in, for exam-
by applying this technology in the adjacent non-woven segment ple, aluminium recycling. In the short term, high energy prices have
(hygiene products). In addition, new successes were achieved by a dampening effect on producers’ propensity to invest. Increased
bringing configurable system solutions to new regions and to new defence spending could lead to higher demand among foundries
applications, where the aim is to be a strong and leading player in and, by extension, the division’s solutions. During the year, prog-
the future. For example, progress was made in solutions for metal ress was made in new markets, including Turkey, through large
recycling in Americas. orders of systems for foundry customers.

“ We were able to deliver on all of our The segment for customised solutions is the most cyclical and
often comprises large and complex projects. During 2022, some
projects in line with or in excess of large and several medium-sized orders were registered and there
the budgeted margins.” is a continued strong pipeline.

Tomas Hagström, Head of Division SALES AND MARKET TREND

The division’s orders received decreased currency neutrally by 4.3
The business benefits from being well-positioned in markets that percent to SEK 1,825m (1,785) and sales increased currency neu-
are favoured by strong global megatrends. Several of the solu- trally by 23.4 percent to SEK 1,722m (1,292). In APAC, which is dom-
tions are used, for example, in the recycling of metals, textiles inated by the textiles segment, the segment performed well with
and chemicals. For instance, the division is world leader in air fil- the division delivered a record order book. In EMEA, where the divi-
tration control in the recycling of aluminium. In addition, the divi- sion is a leader in foundry and smelter systems, demand increased
sion’s non-woven operations (hygiene products) are benefiting with several large projects booked. In the Americas, where the
from the rising health trend and increased economic prosperity division’s largest projects are located, order intake increased while
in developing countries. Other industries, such as green steel and project execution has been accelerated, contributing to the divi-
chemicals, can also use the division’s solutions, thus yielding long- sion’s improved profitability. Service sales have developed strong-
term opportunities. Projects related to such trends can be found ly during the year.
throughout the solutions portfolio. The ambition is to continue to
identify growth opportunities in recycling, non-woven and pos- Milestones in 2022
sibly incineration, while also leveraging opportunities driven by ■ High sales growth and strengthened profitability.
demand from “green industries.” ■ Continued record order backlog and strong cash flow.
■ Breakthrough in new segments, such as non-woven,
The division’s strategy is to be a partner for customer needs to and in new markets.
ensure clean air for the full and often long service life of equip- ■ Strong trend for service operations.
ment. This entails a strong focus on the service portion of the ■ Breakthrough in “Clean Air as a Service” with several
offering, where a number of advances were achieved during the projects sold.
year to meet the needs of the rapidly growing installed base of
50   DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS

Division
Nederman Duct
& Filter Technology

Market position Customers Offering

The division is market leader for ducting Customers are found in a wide range of indus- The division’s concept for ducting systems
systems under the Nordfab brand. Market tries, such as woodworking, metalworking, includes product programmes, design, dimen-
shares in Europe grew in the past year, but cement and concrete production, recycling, sioning and installation support for dust, fume,
the US remains the dominant market. In filter energy production, the automotive industry, gas and smoke extraction as well as industrial
elements, under the Menardi brand, the US is plastics manufacturing and the chemicals ventilation, headed by its proprietary Quick-Fit
also the most important market. The division’s industry. Sales are made through distributors system. The division’s filter solutions are based
strong position is based on the continuous and OEM customers, but there are also signifi- on technology solutions that generate docu-
development of products, design and configu- cant intra-group sales. mented longer lifetimes and reduced mainte-
ration tools, and logistics solutions paired with nance requirements compared with competing
in-depth application and engineering expertise. products, resulting in the best possible lifecycle
cost.

DUCT & FILTER TECHNOLOGY IN BRIEF External sales by region

Head of Division: Jeppe Rasmussen

Brands: Nordfab, Menardi
Average number of employees: 303

SEKm 2022 2021 2020 AMERICAS EMEA APAC

External orders received 704 495 403
Sales 791 541 458
81% 11% 8%
Adjusted EBITA 127 104 64
Adjusted EBITA margin 16.1% 19.2% 14.0%
 DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS   51

Strong growth and new customer segments

It was once again a successful year for Nederman Duct The QFV programme enables Nordfab’s resellers to quickly cre-
& Filter Technology. With full focus on developing value ate 3D designs for the installation of ducting systems for dust
creation around the “Fast, Friendly and Reliable” con- extraction. In addition, there was continued development of Nord-
cept, the division strengthened its customer base and fab’s customer portal and digital order management tool, QTO™, in
market-leading position, leading to both sales and earn- which customers can choose from among thousands of standard
ings reaching new, record levels. products for various ducting systems. Menardi also continued the
development of digital tools for better configuration of its filter
Ducting and filters, as individual components or parts of a system, solutions and calculation of cost savings.
are often considered to be standard products, with price pressure
and high demands for availability and service as a result. To be able The division’s strong focus on delivery reliability and high
to develop sales and retain healthy margins, the division works product quality led to several important breakthroughs on
with the concept of “Fast, Friendly and Reliable,” including digital- the customer side during the year. In the US, several major
isation of processes for a higher degree of service and efficiency. orders were secured for the delivery of ducting systems to
new battery plants. The division delivered to all five of the
The need to upgrade the division’s production plants has increased lithium-ion plants established in the country and is able to deliver
in parallel with the strong development of demand in recent years. to all of the further approximately 20 plants that are under con-
During 2022, a major extension of the plant in Thomasville, NC, struction or in planning. Although ducting systems for the sepa-
in the US, was initiated, which will enable the new concept Nord- ration of dust and smoke comprise a small part of the total plant
fab Now®, with the delivery of standardised ducting products investment, they are of major importance for manufacturing with
to customers within 24 hours. The extension will bring a larger strict cleanliness requirements.
warehouse and spaces better adapted for manufacturing, there-
by reducing the risk of disruptions to production. In addition, solar The position that has been built up in the area also increases busi-
panels will be installed on the roof that will generate energy corre- ness opportunities in Europe, where planning is under way to
sponding to about half of the plant’s consumption. develop battery plants to nearly the same extent as in the US.

During the year, investments were also made to increase the ware- The division continuously evaluates the possibility of expanding
house capacity at the plants in Leeds, in the UK, and Assens, in into new markets. During the year, the assets of Ezi-Duct Pty Ltd
Denmark. In addition, the machinery is being continuously upgrad- were acquired and Nordfab Australia was formed, resulting in a
ed, with, for example, Menardi in the US investing in a new laser platform to grow operations in ducting systems in the Australian
cutter, which has created the chance for growth in new segments market. Another part of the strategy involves creating the right
including food and pharmaceuticals. Regardless of the operations, communication and, during the year, websites were launched in
the investments are about strengthening the “Fast, Friendly and Spanish and French with the aim of increasing business activity in
Reliable” concept, with priority assigned to continued automation Latin America and Canada.
of production and logistics.
SALES AND MARKET TREND

” In the US, several major orders were The division’s external orders received increased currency neu-
trally by 24.6 percent to SEK 704m (495) and sales increased cur-
secured for the delivery of ducting rency neutrally by 28.4 percent to SEK 791m (541). In Americas and
systems to new battery plants. EMEA, orders received grew. Ducting systems, which account for
approximately 80 percent of the division’s sales, continued their
Jeppe Rasmussen, Head of Division strong trend in all regions. The division’s filter solutions displayed
a strong improvement in sales and profitability, driven by high
Creating synergies to be able to enhance delivery reliability is a demand in the US and the ability to meet a high level of delivery
key area within the division. Our presence with our own produc- reliability in a market with global supply challenges.
tion in, for example, North America, has generated competitive
advantages for both Nordfab and Menardi, and created additional MILESTONES IN 2022
business. The new, fully automated pipeline in the Assens plant ■ Strong performance for sales and orders received.
has entered full production, with a large number of deliveries to ■ The acquisition of the operations of Ezi-Duct Pty Ltd
customer projects in the UK. Sales in the UK market more than dou- and the formation of Nordfab Australia.
bled during the year and comprised large orders and new frame- ■ Commencement of the extension of Nordfab’s plant
work agreements. Both Nordfab and Menardi focused on proac- in Thomasville, NC, USA.
tive work to monitor and adapt prices to meet and manage volatile ■ Large orders for battery plants in the US, a new and
material costs that are rising over the long term. rapidly growing segment.
■ Strong increase in sales in the UK, with a major order
The division’s easy-to-use and interactive 3D tool, Quick-Fit Visu- for a kitchen manufacturer.
al® (QFV®) which was successfully launched earlier in the Ameri- ■ Launch of the Quick-Fit Visual® (QFV®) 3D tool in Europe.
cas was rolled out during the year in Europe and was well received.
52   DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS

Division
Nederman Monitoring
& Control Technology

Market position Customers Offering

With its solid application and technology know- The division works with a broad spectrum of The division develops and sells products and
how, the division has gained a market-leading industries that need to continuously monitor systems for laser-based measurement of gases
position in the transformation that has com- and control their production, processes and (NEO Monitors), products and systems for
menced in the industry. Sales are conducted emissions. Waste incineration, power produc- emissions analysis based on infrared measuring
through the division’s own companies, their tion and oil/gas extraction, as well as steel, technology (Gasmet) and continuous particle
networks of distributors and other divisions aluminium and chemicals are industries with monitoring systems (Auburn FilterSense). The
within Nederman. Product development, major needs and potential. The product pro- digital offering is based on a proprietary IoT
increased integration with other divisions and gramme is being continuously developed, and platform (Nederman Insight), which provides
further acquisitions are priorities for continued together with Insight, now covers a large part customers with information on critical parame-
expansion. of the group’s overall customer and industry ters and processes.
segments.

MONITORING & CONTROL TECHNOLOGY IN BRIEF External sales by region

Head of Division: Ketil Gorm Paulsen

Brands: NEO Monitors, Auburn FilterSense, Gasmet, Insight
Average number of employees: 234

SEKm 2022 2021 2020 AMERICAS EMEA APAC

External orders received 657 562 496
Sales 606 537 507
30% 42% 28%
Adjusted EBITA 97 121 95
Adjusted EBITA margin 15.9% 22.5% 18.7%
 DIREC TORS’ REPORT - NEDERMAN’S DIVISIONS   53

High level of activity in a challenging market

Following an initial phase of strengthened interest in The system offering in both emissions monitoring and filtration
digital monitoring and control of production process- monitoring has improved, as has the functionality for remote mon-
es during the pandemic, the trend was somewhat more itoring of installed systems and maintenance functions, which
challenging in 2022. The business displayed continued reduces the need for travel by service personnel to installation
growth and a high rate of product development, but chal- sites. In addition, several sustainability initiatives were launched,
lenges in obtaining finished goods and components in such as “plant a tree” for each system sold, and a project for more
normal time had a negative impact on business activity environmentally friendly packaging and transport materials.
and profitability.
The pace of development of new solutions was high during the
The division displayed healthy growth and profitability during the year. A new technology solution for the measurement of hydro-
entire pandemic, but the most recent year was characterised by gen and carbon dioxide based on the LaserGas™ III platform was
some challenges, primarily obtaining components and finished launched for applications in green industries and other sectors
goods in normal time. Accordingly, the division has placed addition- with a strong focus on reducing their greenhouse gas emissions.
al focus on ensuring that customers’ needs are met. The shortage At the major ACHEMA fair in Germany, the Nederman Insight IoT
of components also led to increased costs for input goods, as well platform was presented to the European market. During the
as for personnel fully occupied with supply issues. In addition, the year, new certification and audits/re-certification of the current
continued extensive covid-19-related lockdowns in China affect- portfolio were carreid out by international certification bodies,
ed sales activities and resulted in delays to the projects being sup- including UKCA and TÜV. For Nederman Insight IIoT, Insight Cloud
plied by the division. was certified for Cloud Security Alliance Level I, and Level II is under
evaluation, demonstrating Nederman’s commitment to prioritise
During the year, activities were initiated to enhance production security in IIoT. Insight Cloud was also released with the integra-
efficiency in all business units and to be able to implement changes tion of Nederman’s energy-optimised SAVE technology at the IWF
in product design to counteract the challenges in the supply chain. fair in Atlanta, in the US. Finally, Insight Control was certified for
hardware for sale to the US, Brazil and China.
At the same time, new orders were secured with major interna-
tional customers in, for example, the energy and process industry, To keep the division’s three offerings together and conduct effec-
and primarily in the US. Gasmet demonstrated a robust strength- tive sales and service work, a great deal of effort has been put into
ening of the operations in Germany, in terms of both organisation building up digital processes, tools and market presence. The roll-
and business activities. Through the acquisition of the Swiss dis- out of digital tools for operations monitoring and control, such as
tributor MBE AG, Gasmet’s presence and sales in Switzerland were IFS ERP in AFS, continued. The use of digital tools in sales meetings,
also strengthened. NEO Monitors’ operations in the US continued web seminars and training courses also continued to increase. In
to display stable growth and large orders were secured in, for addition, a project is in progress to create a shared go-to-market
example, the gas and chemicals sector. At the same time, a joint strategy with Nederman’s other divisions, based on digital sales
activity is under way to encourage the growth of all brands in the and marketing channels.
US, for example, by increasing the number of direct transactions
with end customers. SALES AND MARKET TREND
The division’s orders received increased currency neutrally by 7.2
Another long-term activity is to increase service sales. The service percent to SEK 657m (562), while sales increased currency neu-
offering and local support were strengthened in the US and sever- trally by 3.1 percent to SEK 606m (537). Americas led the trend,
al new service agreements were signed. The division also worked with an increasing amount of customer activity in the region.
to establish a platform for growth in service and support in China, Orders received and sales were also strengthened in EMEA,
which is a requirement, for example, when tendering for green- although the activity in some markets was negatively affected
field projects with large customers in the country. by the war in Ukraine. In APAC, the extensive covid-19-related
restrictions in China dampened demand.

“ The division is pursuing several devel-

MILESTONES IN 2022
opment projects aimed at accelerating ■ Continued healthy orders received and sales growth.
the green transition” ■ Challenges in the supply chain impacted profitability
and supplies.
Ketil Gorm Paulsen, Head of Division ■ Acquisition of Swiss distributor MBE AG.
■ Large orders in energy and process industry.
The division is pursuing several development projects aimed at ■ Stronger service offering in US and China.
accelerating the green transition – such as Gasmet’s mercury mon- ■ Joint effort to grow in the US with all three brands.
itoring system and NEO Monitors’ hydrogen monitoring system ■ High pace of product development with several launches.
to support customers’ investments in new green energy sources. ■ Growing offering with focus on sustainability.
Sustainability
initiative
 DIREC TORS’ REPORT – SUSTAINABILIT Y   55

Integrated
sustainability
work
Sustainability and initiatives in the area comprise an
integrated and important part of Nederman’s business
activities. We work proactively to improve our own
impact, while our products and solutions help our cus-
tomers to reduce their air pollution and environmental
impact. Nederman’s promise – to protect people, planet
and production – is the foundation of our sustainability
agenda. The objective is to minimise negative social,
environmental and financial effects from industrial
production within our own business activities and
those of our stakeholders.

Milestones in 2022

■ Sustainability-related financing agreements with extended

credit facilities were signed.
■ Expanded reporting in line with applicable guidelines in the
EU taxonomy was implemented.
■ The goal of halving our climate impact from energy use by 2023
was already achieved in 2022.
■ Installation of solar cell system on the largest production unit
was initiated.
■ The sustainability report for 2022 has been reviewed by
Nederman’s auditors.

We focus on

■ Reduced environmental impact, page 57 (environmental sustainability)

■ Compliance with laws and regulations, page 58 (financial sustainability)

■ Efficiency in manufacturing and operation, page 60 (financial & environmental sustainability)

■ Health and safety, page 69 (social sustainability)

There are measurable goals in every area.

56   DIREC TORS’ REPORT – SUSTAINABILIT Y

Sustainability structure
Energy Digitalisation Sourcing

-75% 77% 94%

Reduction of greenhouse gas (GHG) Share of sold stationary Nederman Share of our suppliers of materials
emissions Scope 1&2 in relation filters that are IoT-ready. and goods who have signed
to sales. Base year 2014. our Code of Conduct.
Goal: -50% by 2023 Goal: 100% in 2023 Goal: 100% in 2023

Recyclability of products launched as of 2024

Target: 100%

Reporting
FINANCIAL in accordance with GRI and performance
SOCIAL ENVIRONMENT
measure structure

Climate goals in accordance with Science Based Targets

SBT Scope 1 & 2 SBT Scope 3
Reduce our production units’direct and Reduce our indirect climate impact,
indirect climate impact related by which we initially focus on our goods transport
to energy use and purchased electricity. relating to suppliers of material.

The UN Sustainable Development Goals

The 17 UN Sustainable Development Goals comprise the base for Nederman’s
sustainability work. Nederman contributes mainly to the following goals.

The Clean Air Company

We protect people, planet and production
Mission, vision and values

UN SUSTAINABLE DEVELOPMENT GOALS

– OUR FRAMEWORK FOR SUSTAINABILITY ACTIVITIES
The group has applied the UN Sustainable Development Goals and the ten
principles for sustainable development according to the UN Global Com-
pact initiative since 2015. The UN Agenda 2030 for sustainable develop-
ment is the framework for our initiatives in efforts to meet future social,
environmental and economic challenges. The results are presented in
accordance with the Global Reporting Initiative (GRI).
 DIREC TORS’ REPORT – SUSTAINABILIT Y   57

Nederman’s sustainability work is based on responsible business External reports on sustainability activities are published on ned-
practices, high transparency and good business ethics, with the ermangroup.com. Summarised reporting is provided internally
UN Sustainable Development Goals providing a framework for quarterly.
this work. Through resource-efficient production and innovative
solutions in clean air, we contribute to creating growth and value This sustainability report, prepared in accordance with GRI
for all stakeholder groups throughout the value chain. Continu- Standards, can be found on pages 54-72 and also constitutes
ously improving our products’ environmental performance and Nederman’s statutory sustainability report in accordance with
minimising the negative effect from our own operations is key. We the requirements of the Annual Accounts Act. The sustainability
focus, for example, on digital solutions that increase opportuni- report, with the exception of disclosures according to the EU’s
ties for measurement and optimisation, thus enabling the custom- taxonomy regulation on pages 64-66, has been reviewed . See the
er to take full control of the air filtration process. This generates a auditor’s report on page 73.
strong increase in the effectiveness of resource management as
well as compliance with legislation and regulations.
Reduced
GOVERNANCE, AREAS OF RESPONSIBILITY
AND MEASURABLE TARGETS environmental impact
The Board of Directors has ultimate responsibility for Nederman’s
sustainability work, and decides on long-term goals as part of the Nederman wants to contribute to reducing the climate footprint
group’s strategic objectives. Group management is responsible and environmental impact in the world, which is primarily achieved
for follow-up and development based on the group’s governance through our products. Although our production is not energy-inten-
model, which comprises an integrated part of the group’s strate- sive, we are working to increase energy efficiency and converting
gy and business processes. These processes apply to all divisions operations to renewable energy. We strive to use all resources more
and customer offerings, and aim to create long-term values for all efficiently by standardising and optimising internal processes. We
stakeholders. Long-term objectives and performance measures work actively to maximise positive effects and minimise the neg-
are established for each division and are included in the business ative environmental impact throughout the value chain. In order
plan for each division. to implement changes where they make the most difference, it is
important to have meaningful collaboration with business partners
SUSTAINABILITY-LINKED CREDIT FACILITY and other stakeholders. These collaborations also make us better
Sustainability is an integrated part of Nederman’s strategy, from prepared for potentially higher taxes and fees on activities that
products that capture air contamination and digital solutions that contribute to a greater climate and environmental impact.
save energy to a business that constantly strives to reduce energy
use and to conduct business in a responsible manner. CLIMATE FOOTPRINT AND
REDUCED ENERGY CONSUMPTION
During 2022, Nederman took another step in the direction of secur- In line with the Science Based Target initiative (SBTi), Nederman
ing the concern’s financing via a Sustainability-linked Credit Facility. intends to reduce the group’s climate footprint in terms of Scope 1
This means that interest on the facility is now linked to the perfor- and 2 by 50 percent by 2023 compared with 2014. This target was
mance of key sustainability data that is continuously monitored. already achieved in 2022 and in 2023, Nederman’s sustainability
work will be further reviewed.
Accordingly, Nederman’s financing is in line with our sustainabili-
ty activities and a key factor in driving Nederman’s sustainability A general analysis of Scope 3 emissions along Nederman’s value
agenda. chain indicates that the sourcing of materials and components
comprises the group’s single largest emissions category. This is
DATA COLLECTION, REPORTING AND AUDITING followed by purchased goods transportation, business travel
Internal data collection is mandatory and concerns all production and waste from worn-out products. To date, Nederman has only
units (however, acquired production companies in 2022 such as included purchased goods transport in its Scope 3 report.
RoboVent and Ezi-Duct are excluded) for all sustainability indi-
cators except data on health and safety, anti-corruption and on Data on energy and emissions from energy use are reported and
employees where all companies are included in the reporting pro- followed up quarterly by Nederman’s group management. Our pro-
cess. Collection takes place quarterly for the most part (see page duction units work with locally adapted, measurable target values
39 for a list of the production units). Sustainability reporting based and performance measurements. All units must present activity
on systems for environmental management and certification (ISO plans, such as for reduced energy consumption.
14001), and quality control and certification (ISO 9001), is con-
ducted in the same system as the financial reporting. Sustainabil- MATERIAL, MANAGEMENT OF
ity reporting has been clarified in accordance with the applicable HAZARDOUS WASTE AND RECYCLING
GRI standards. The energy efficiency of products, ecologically sustainable materi-
als handling, circular economy and recycling are key areas for Neder-
Methods and categories for Scope 3 emissions were reorganised man. Use of materials means risks, such as containing undesirable
in accordance with the Greenhouse Gas protocol (GHG Protocol) substances, and opportunities, such as innovative material that
with boundaries and a focus on upstream and downstream goods has a positive effect on energy performance. In addition, the focus
transport, which reflects the actual conditions instead of the among our stakeholders is increasingly on the importance of trace-
standard method. Reporting in line with applicable guidelines in ability of materials in the supply chain and knowledge of product
the EU taxonomy was implemented. content to facilitate a more circular economy on a daily basis.
58   DIREC TORS’ REPORT – SUSTAINABILIT Y

The details can differ between different types of environmental els directly on-site. The training of personnel is also important
impact, but overall, Nederman has a similar management strategy to ensure that equipment is used in an energy-efficient manner.
for materials, water and waste. These areas are significant, pri- Improvement measures also contribute to better indoor air quality
marily for the group’s production units. The largest environmental and greater satisfaction among employees.
impact from materials use is in the value chain and is related to ener-
gy and waste. Nederman can influence this mainly through a greater MORE SUSTAINABLE PRODUCTS
share of recycled materials in our production and improved mate- AND PRODUCT DEVELOPMENT
rials efficiency in design and development, which, in turn, reduces Nederman works actively to develop products and solutions that
energy consumption and emissions, upstream and downstream. are as efficient as possible, with a reduced environmental impact
and the lowest total ownership cost over the product’s entire ser-
Nederman’s objective is for the amount of waste to continuously vice life. Digitalisation and innovation represent a priority area.
decline in relation to net sales, the share of recycled waste should Digital technology and solutions simplify active monitoring of vari-
increase and the practice of sending waste to landfill should be ous processes so that operations can take rapid action in the event
eliminated by 2023. This objective is included in the work on regu- of deviations. This makes it possible to work more sustainably and
latory compliance and constant improvements and has no “sell-by energy efficiently. Environmental impact is to be evaluated and
date”. All of the group’s production units conduct measurement minimised for all new products in accordance with the group’s
and monitoring based on goals and plans for scrapping and the product strategy plan. All launches are evaluated in line with this
management of waste, including hazardous waste. and checked against the goals for reduced environmental impact.

Nederman’s production only generates a marginal amount of haz- With the circular economy as a growing necessity, the group is
ardous waste. Hazardous waste comprises, for example, used spray investigating the possibilities for continuing to contribute to low
cans and electrical waste, as well as residual materials from proper- environmental impact through a high degree of recyclability in
ty maintenance work, such as the replacement of fittings and light- products, one of the targets for 2023.
ing tubes. The amount of hazardous waste is monitored regularly
for the group’s production units and the goal is included in the work
to eliminate hazardous substances from the loop. Material recovery
from hazardous waste is achieved by hazardous substances being Compliance with
separated and the remainder then being recycled.
laws and regulations
The group does not use chemicals in its production, apart from
small amounts of lubricant and surface finishing for products, for Our business principles are characterised by integrity, responsibil-
example, and accordingly, has no negative impact whatsoever on ity and sound ethics – fundamental principles that we share with
waste water. our employees, suppliers, customers and investors. We prioritise
the prevention of corruption. For many years now, the UN Global
Since 2021, Nederman has measured the share of used material Compact initiative has served as our ethical compass. We became
derived from recycled sources for aluminium, steel and plastic at a member of this initiative in 2020 and have continued to work
its four largest production plants. During 2022, this amounted to and develop our sustainability activities in accordance with it. Our
14.9 percent (12) of the purchasing spend. The estimate follows operations are encompassed by environmental legislation, regu-
the definition of GRI 301-2. However, note that the share of recy- lations and conditions governing such aspects as the handling of
cled material in one of our plants in the US is still based on the pre- hazardous or undesirable substances in our products.
ceding year’s figure.
NEDERMAN GROUP’S CORPORATE
WATER CONSUMPTION GOVERNANCE DOCUMENTS
Nederman has a general policy of enhancing the efficiency of use Our corporate governance documents regulate the principles and
of resources, which includes water. Direct water usage is of little values that guide our operations in general and, in particular, our
importance at Nederman’s plants, since water is not used to any sustainability work. Policies and plans are reviewed regularly and
large extent for production, but only for hygiene and kitchen pur- updated and communicated as required.
poses. Water consumption is checked regularly to ensure that ini-
tiatives aimed at reducing the use of fresh water have the desired Code of Conduct
effect. Water usage is relevant due to the close relationship with Our corporate governance documents regulate the principles and
energy use and for this reason, the group endeavours to use values that guide our operations in general and, in particular, our
renewable electricity. sustainability work. Our Code of Conduct and equality and diversi-
ty plan were updated in 2022.
GREEN CONSTRUCTION GENERATES ENERGY SAVINGS
Nederman actively promotes energy efficiency at its production Code of Conduct for Suppliers
units. Energy efficiency is achieved through technology measures Our Code of Conduct for Suppliers is based on the international guide-
and behavioural changes. The areas of improvement include insu- lines and is harmonised in line with our internal Code of Conduct. The
lation of buildings, optimising compressors and more energy-effi- Code applies to all persons or legal entities that supply products and/
cient installations and equipment for lighting, ventilation, heating or services to or on behalf of Nederman and its subsidiaries.
and cooling.
Nederman requires that all suppliers meet the specifications in
Other measures comprise transitioning to renewable energy the code, and have ensured that their subcontractors are aware of
sources for the electricity that is purchased or to install solar pan- and meet standards that are at least as strict. Nederman urges all
 DIREC TORS’ REPORT – SUSTAINABILIT Y   59

suppliers to establish their own codes of conduct or written policy where the operations are conducted. Compliance is important and
documents based on the above international guidelines. It is avail- to ensure awareness, training is compulsory for the relevant per-
able for download from nedermangroup.com. sonnel, as well as robust communication processes.

Nederman’s goal is to work only with suppliers who comply with Whistleblower policy
the relevant sections of the Code. At the close of 2022, the share Nederman has a clear reporting process for employees and oth-
of suppliers that had ascribed to the Code was 94 percent (91). The er stakeholders in accordance with our whistleblower policy.
suppliers’ compliance with this requirement is checked by way of Employees are urged to report to their immediate manager or a
audits and other measures. 89 (73) supplier audits were conduct- third party any suspected irregularities, illegal activity or failure to
ed during the year. Existing methods are under development to act, such that they perceive as a breach of applicable legislation,
assess the suppliers’ sustainability efforts in order to promote Nederman’s internal policies or the group’s IT security policy.
responsibility throughout the value chain.
An employee can submit a report in two ways:
Policy for sustainability and quality ■ Contact their immediate superior or the manager of the
Our sustainability and quality policy, which also includes our envi- department involved. Depending on the issue and the person
ronmental policy, is our benchmark when we develop products and being reported, the superior will decide if the issue is to be
systems solutions that are all designed to improve the work envi- passed on to Nederman’s management.
ronment and reduce the environmental impact of our customers. ■ Report anonymously by e-mail/letter to a third party,
headed by an external lawyer.
Nederman monitors the share of new suppliers that have under-
gone evaluation based on environmental criteria according to the Persons other than employees, such as partners, contractors,
GRI 308-1 definition. During 2022, the share was 16.8 percent (4.1). suppliers and distributors, who have commitments through Ned-
erman, can make a report to the same external third-party lawyer.
Policy for anti-corruption and fraud
Our policy against corruption and fraud is aimed at describing and Reports can be made anonymously and are processed confiden-
improving the rules to be applied at Nederman to prevent corruption tially. Appropriate action is taken for each report. Nederman’s
and fraud in all activities that are under Nederman’s control. All of whistleblower policy and associated principles, including the
Nederman’s employees must comply with this policy and detailed reporting process, are in place to protect the whistleblower. The
procedures in their respective local companies, as well as all appli- policy is available to employees and other stakeholders via neder-
cable legislation on bribery. We conduct interactive and recurring mangroup.com, and via the intranet and other channels. The policy
training on the policy for all employees every second year. is available on all websites, is translated to local languages and is
also provided to new employees as part of introductory training.
Nederman monitors the number of companies audited for corrup- The EU’s new legal requirements related to whistleblowing com-
tion in accordance with the GRI 205-1 definition. The audit is con- prise the basis for Nederman’s constant improvements. In turn,
ducted by way of self-assessment by the companies. The number this leads to further analysis and formation of opinions on refin-
of audited companies in 2022 was 68 (66), representing 97 per- ing the existing system and associated policy, with the purpose of
cent share of the operating companies. Note that two of the three protecting persons who report irregularities.
companies newly acquired in 2022 were exempt from audit. In
the acquired company that was audited, the need was uncovered Diversity policy
to upgrade the control processes to Nederman’s standard. This We are convinced that diversity strengthens innovation and is a
action is in progress. source of competitiveness and profitability. Promoting diversity is
decisive for our business successes – and is fully in line with that
Anti-trust policy described in Nederman’s core values and Code of Conduct.
Nederman’s anti-trust policy comprises all companies and employ-
ees of Nederman. No employee is permitted to act in any way that We:
suppresses the free market. The policy also stipulates that Neder- ■ Strive to fulfil all local diversity legislation and
man and its employees must not abuse a given position in the mar- regulations, proactively and responsibly.
ket to exclude competitors or exploit customers. Employees are ■ Tolerate no discrimination – not on the basis of gender, race,
urged to report any suspected irregularities, illegal activity or failure religion, age, sexual orientation, nationality, political views,
to act, such that they perceive as a breach of applicable legislation, trade union membership, disability, socially or ethnic origin.
Nederman’s internal policies or the group’s IT security policy. ■ Have zero tolerance of harassment and bullying.
■ Focus on diversity during the recruitment process and endeav-
Policy for export control and sanctions our to have at least one candidate of the under-represented
Nederman strives and works proactively to conduct operations gender for every three candidates.
according to applicable legislation and the export controls and sanc-
tions (Export laws) that are passed by countries throughout the In addition to the update of the diversity policy during the year,
world, including the US, the EU and the UN. For example, our Russian Nederman conducts annual employee surveys to measure such
operations were put on hold and all new orders to the operations aspects as work environment and discrimination, with active fol-
were halted directly following the Russian invasion of Ukraine. low-up of the results at management level, in employee groups
and in other networks. Our Understanding Diversity training pro-
Nederman must comply with all relevant export legislation in the gramme is available to all employees.
jurisdictions in which the company operates. We must always
follow export legislation, regardless of the origins of the rules or
60   DIREC TORS’ REPORT – SUSTAINABILIT Y

Health and safety policy ty failure costs in production, in relation to sales, was <0.3 percent
Providing a safe and healthy environment is decisive for our com- up until 2023. The result was 0.18 percent (0.22). Focus during the
pany’s successes. We work proactively to create physical and men- year: Goals that are not achieved have a negative effect on factors
tal health among our employees. such as increased electricity consumption as a result of reworking,
increased carbon dioxide emissions from air transport to correct
The daily work on issues that affect health and safety and employ- the error and longer delivery times. We focus on efficiency of oper-
ees is decentralised. Every single company and unit has a respon- ations and on resolving problems where they arise.
sibility to conduct training in and address these issues so that they
comply with the group’s policy and with each country’s legislation GLOBAL MANAGEMENT SYSTEM
and regulations. The parent company and all production units must have a man-
agement system that is certified in accordance with ISO 9001
(international standard for quality management systems) and ISO
14001 (international standard for environmental management
Efficiency in manufacturing systems). Acquired companies are to be certified within two years.
At the end of 2022, 17 out of 21 production units were certified
and operations according to ISO 9001 and 16 of 21 units were certified according
to ISO 14001, including the most recent acquisitions. Certification
Nederman works actively to maximise positive effects and mini- of the further units is planned for 2023.
mise the negative impact throughout the value chain. Implement-
ing changes where they make the most impact is conducted in col- Nederman’s global management system, GuideUs, is a framework
laboration with business partners and other stakeholders. of rules and requirements for Nederman’s operations and is based
on ISO 9001 and ISO 14001. The management system is used to
QUALITY IMPROVEMENT ensure that the operations are managed in a way that means that:
We strive to reduce the costs and environmental impact that are
connected with quality problems in production. The goal for quali-

ENERGY INTENSITY, MWH/SEKM GREENHOUSE GAS EMISSIONS

IN RELATION TO
SALES, KG CO2e/SEKT
15 5

12 4

9 3

6 2

3 1

0 0
2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022

The goal is to reduce energy use in relation to sales. The goal is to halve the greenhouse gas
emissions related to energy use and purchased
Outcome 2022: The measures for energy efficiency electricity for the group’s production units,
and increased sales generated good results. The in relation to sales, by 2023 (base year 2014).
2022 outcome was 4.85 (6.82). Apart from the
2022 acquisitions, all production units were includ- Outcome 2022: The goal for 2023 was already
ed: Energy use amounted to 14 105 MWh and the achieved in 2022, with a reduction of 75
turnover amounted to 2 906 SEKm. percent. The outcome was 1.00 (2.06).

WASTE GENERATED, TONNES .WASTE RECYCLING, % WATER CONSUMPTION, M3

100 25000
4000

3200 80 20000

2400 60 15000

1600 40 10000

800 20 5000

0 0 0
2016 2017 2018 2019 2020 2021 2022 2014 2015 2016 2017 2018 2019 2020 2021 2022 2016 2017 2018 2019 2020 2021 2022

The amount of waste is to continuously decline The goal is to achieve 95 percent recycling of Measurement of water consumption pertains
in relation to net sales. In the same way, the waste in production compared with the aver- to fresh water for kitchen, hygiene and sani-
amount of hazardous waste is being continu- age for 2014. Recycling is conducted through tary purposes at our production units. Water is
ously reduced, with goals set at a local level. external partners. not used for production purposes.

Outcome 2022: The total amount of waste Outcome 2022: At the end of 2022, recycling Outcome 2022: 18,306 m3 (22,247).
generated increased by approximately 49 per- amounted to 94.7 percent (95).
cent due to the expansion of operations in the
US. The 2022 outcome was 3,288 tons (2,207).
 DIREC TORS’ REPORT – SUSTAINABILIT Y   61

■ The most important stakeholders’ (customers, employees, The revitalisation of Nederman’s global management system with
suppliers and shareholders) goals are fulfilled. a new platform commenced during 2022.
■ The operations are conducted within established frameworks
for risk taking and with reliable internal control.
■ Applicable legislation, listing requirements and corporate
governance codes are followed and that the company fulfils its
social responsibility.

CLIMATE REPORTING IN ACCORDANCE WITH SCIENCE CLIMATE IMPACT FROM GOODS TRANSPORT ACCORDING
BASED TARGETS TO SCIENCE BASED TARGETS SCOPE 3 – FOR AB PH
Nederman reports emissions for Scope 1 and 2 and for goods NEDERMAN & CO – EMISSIONS TO AIR, TONNES CO2e
transport in Scope 3. Scope 1, 2 are based on actual consumption 400
data. The method for Scope 3 was changed from a standard value
350
to now being based on actual consumption data from the largest
transport providers in our four largest production plants. 300
250
Basis for calculation of Scope 1 and 2
200
To calculate Scope 1 and 2 emissions, a location-based method
(pursuant to the GHG Protocol, 2015) is used wherever possible. 150
The reported data for Scope 1 is based on energy use and related 100
emission factors.
50
Generally accepted country and region-specific emission factors 0
Air Boat Train Road Total
are used in the calculation of Scope 2 emission data. These factors
reflect each country’s average energy mix: sun, wind, hydro and inbound goods transport
nuclear power generate lower emissions, while higher use of fossil outbound goods transport
fuel, such as coal and oil, generates higher emissions. The above example shows the climate impact of AB Ph Nederman
& Co’s plants for each mode of transport during 2022.
Basis for calculation of Scope 3
A general analysis of Scope 3 emissions along Nederman’s value Nederman will reduce energy consumption in production in
chain indicates that the sourcing of materials and components is relation to sales and growth. Energy intensity is a measure of
the single largest emissions category. Other significant areas are efficiency. The outcome for 2022 confirms the positive trend.
deemed to be purchased goods transport, business travel and
waste related to worn-out products. The analysis is based on the Energy intensity
group’s own estimates and not on data from suppliers; the error MWh/SEKm 2022 2021 2020 2019 2018
margins are considerable. The group has therefore decided as an Total energy use (MWh) 14,105 16,228 13,794 14,870 14,694
initial step to limit reporting of Scope 3 emissions to actual con- Net sales 2,906 2,381 2,021 1,489 1,438
sumption data from goods transport, and to develop the method (SEKm)
from there. Energy intensity 4.85 6.82 6.83 9.99 10.22
(MWH/SEKm)

Climate impact according to Science Based Targets

Emissions to air, Out- Out- Out- Out- Out- The energy intensity is monitored thoroughly and during 2023, we
tonnes come come come come come will continue to analyse goals and measures that need to be imple-
2022 2021 2020 2019 2018
mented for the establishment of new goals to apply as of 2024.
CO2e Scope 1 1
745 1,197 908 810 571
CO2e Scope 22 2,152 3,761 4,297 5,023 5,054
In this section, fuel consumption refers to direct energy use and
CO2e Scope 33 804 5 1,0204 8,907 8,186 6,982
energy consumption refers to indirect energy use. Fuel consump-
Emissions, Scope 2,897 4,958 5,205 5,833 5,625
1+2 tion from renewable energy was 0 (zero) in 2022. Fuel consump-
tion from non-renewable energy was 3,981 MWh (14,333 GJ) in
1 Scope 1: Total greenhouse gas emissions from fuel combustion in manufac- 2022. Total fuel consumption comprised 42 MWh (153 GJ) from
turing, tonnes. Apart from the 2022 acquisitions, all production units were
included. diesel, 220 MWh (792 GJ) from oil and 3,719 MWh (13,387 GJ) from
2 Scope 2: Total greenhouse gas emissions from purchased electricity in natural gas. Total energy consumption was 10,123 MWh (36,444
manufacturing, tonnes. Apart from the 2022 acquisitions, all production units
were included.
GJ). Consumption comprised 8,270 MWh (29,772 GJ) of electricity
3 För Scope 3 emissions, greenhouse gas emissions from goods transport for (of which 3,273 MWh (11,785 GJ) was renewable) and 1,853 MWh
our four largest production plants are reported. This is only part of Nederman’s
(6,672 GJ) in heating (of which 1,287 MWh (4,632 GJ) was renew-
Scope 3 emissions. A significant share of the emissions comes from materials.
These emissions cannot currently be reported due to difficulties in collecting able). Production from solar panels amounted to 218 MWH (785
exact data. Gj), of which 68 MWH (244 GJ) was sold to third parties.
4 The calculation method for Scope 3 was changed in 2021 from a standard value
to being based on actual consumption data from the largest transport provid-
ers in our four largest production plants. Accordingly, it is not compara­ble with Data was gathered from the companies’ actual consumption.
earlier years.
5 The proportion of total transport that the reported emissions represent is cal-
culated at approx. 26%, based on the turnover of the four largest production The source of the conversion factors used to restate kilowatt
facilities in relation to total turnover. hours to joules and litres to cubic metres wasChemical Principles
6th edition (January 1, 2013).
62   DIREC TORS’ REPORT – SUSTAINABILIT Y

Materiality analysis and results 2022

HIGH
ECONOMIC SUSTAINABILITY
Evaluate Work actively
and engage in dialogue with and engage in dialogue 1. Financial result
2. Anti-corruption and
17 3
14
competitive behaviour
2 3. Customers’ sustainability work
16 15
Significance for stakeholders

12 4. Information security and

6
1 user integrity
4
10
9

8 13 SOCIAL SUSTAINABILITY
7 18

5 5. Employment and
11 employee relations
6. Health and safety at work
7. Training
8. Diversity and equal opportunities
9. Non-discrimination
10. Human rights
11. Social engagement
Work actively with and engage
Evaluate in dialogue when appropriate ENVIRONMENTAL SUSTAINABILITY
LOW HIGH
12. Energy and climate
Impact on Nederman group
13. Materials
The materiality analysis is a core part of the strategy and goal formulation, risk manage- 14. Water
ment and reporting. The assessment is conducted regularly with two combined perspec- 15. Waste
tives: to investigate the impact of the company’s operations on financial, environmental 16. Waste water
and social issues, as well as the importance these issues have for stakeholders. Each area 17. Compliance with
is defined in accordance with the Global Reporting Initiative (GRI). The following four areas environmental legislation
are deemed most important: Customers’ sustainability work, Anti-corruption and com-
18. Supplier evaluation
petitive behaviour, Health and safety at work and Information security and user integrity.

QUALITY FAILURE COSTS, % CODE OF CONDUCT IN THE SUPPLY SUPPLIER AUDITS

CHAIN, %

0.5 100 100

0.4 80 80

Mål 2023
60
0.3 60

40
0.2 40

20
0.1 20

0
0.0 0 2016 2017 2018 2019 2020 2021 2022
2015 2016 2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021 2022

More efficient use of resources. For quality The goal is for 100 percent of materials and Supplier audits through site visits are
failure costs in production, in relation to sales, goods in production to come from suppliers conducted to monitor compliance with
the goal is <0.3 percent up until 2023. who had signed our Code of Conduct for Nederman’s Code of Conduct for Suppliers.
Suppliers by 2023.
Outcome 2022: At the end of 2022, the result During 2022, 89 supplier audits were
amounted to 0.18 percent (0,22). Outcome 2022: 94.1 percent came from conducted, which is 16 more than in the
suppliers who had signed our Code of preceding year.
Conduct for Suppliers.

REPORTED WHISTLEBLOWER CASES, 2022 1)

During the year, one case was formally reported using the whistleblower system Operations (100%)
and one via management, both related to complaints about local management
and/or lack of internal compliance with policies and guidelines. Investigations
were conducted and the required action taken. No action remains and the
reported whistleblower cases are therefore closed.
2 1)
Sustainability (0%)

The reported whistleblower cases category

is determined on the basis of the most material
effect identified by those responsible for inves-
tigations
 DIREC TORS’ REPORT – SUSTAINABILIT Y   63

Stakeholder dialogue

As part of our daily work, and in particular,

our sustainability work, a continuous dia-
logue is conducted with a large number of
stakeholders – customers, investors and
analysts, employees, trade unions, civil
society (often represented by media and
independent organisations) and business
partners. We communicate with stakehold-
ers in different ways depending on the type
of relationship.

■ Customers
■ Employees
■ Investors
■ Suppliers
■ Society

Stakeholders Definition Form of dialogue Key subjects

Customers Existing and potential Meetings, interaction through Product safety, life cycle perspective
market companies, joint projects, and circularity, crisis readiness,
customer surveys. human rights, business ethics
including corruption, supply chain
management.

Employees Existing and potential Workplace and management Safety, human rights, carbon emis-
meetings, employee surveys, sions, diversity, employee welfare,
career appraisals, trade unions leadership, crisis readiness including
and other cooperative councils. risks, business ethics, supply chain
management, waste, water.

Investors Existing and potential Meetings with investors and Product safety, security, life cycle
shareholders, investors analysts, capital markets days, perspective and circularity, carbon
and analysts website, annual and emissions from own operations, crisis
sustainability report, readiness including risks, business
quarterly reports. ethics, supply chain management.

Business Suppliers, partners, Evaluation and audit of business Product safety, security, human
partners distributors and resellers partners, procurement, meet- rights, crisis readiness including risks,
ings, joint projects. business ethics including corruption,
supply chain management.

Society Governments, local Meetings, collaboration/projects Human rights, diversity, carbon

communities, voluntary with universities, colleges emissions, business ethics, supply
organisations, academic and government agencies. chain management, taxes, life cycle
institutions perspective and circularity.
64   DIREC TORS’ REPORT – SUSTAINABILIT Y

EU Taxonomy

The establishment of a classification system for more sustain- utes to reducing pollution. The products provided by Nederman
able activities, a green taxonomy, is a central measure within the contain neither mercury nor substances harmful to the ozone lay-
framework of the EU’s action plan for the financing of sustainable er and they comply with RoHS and REACH. Corresponding require-
growth. From 1 January 2022, companies such as Nederman must ments are placed on suppliers in the Nederman “Supplier Code of
start applying this taxonomy and classify turnover, investments Conduct”.
and expenses.
Biodiversity and ecosystems (16): Nederman activities take place
As a first step, reporting must take place for the climate-related on industrial land and do not significantly affect biodiversity and
goals in the taxonomy, i.e. the first two goals: climate change miti- ecosystems. Nederman operations do not take place in or near
gation and climate change adaptation. Based on those goals, Ned- protected natural areas or areas with high natural values. Signif-
erman must identify the activities in the business that are eligible icant environmental issues and risks are handled in the company
for taxonomy and are aligned to it. work with ISO certifications. At the end of 2022, 17 out of 21 pro-
duction units were certified according to ISO 9001 and 16 out of 21
For Nederman, these activities have been identified primarily units were certified according to ISO 14001. Certification of addi-
within climate change mitigation and consist of providing various tional units is planned to take place in 2023. In addition, Nederman
measuring systems and software solutions within the Monitor- holding and its group functions are certified according to ISO 9001
ing & Control Technology Division; they are reported respectively and ISO 14001.
under 3.6 Manufacturing of other low-carbon technology and 8.2
Data-driven solutions for reductions in greenhouse gas emissions. Minimum safeguards (17): Nederman apply fair competition poli-
cy, anti-corruption policy, anti-bribery policy and human rights are
CRITERIA FOR SUBSTANTIAL CONTRIBUTION handled, among other things, in the company’s code of conduct.
These activities contribute significantly to reducing emissions of In addition to the certification work for ISO 9001 and ISO 14001,
greenhouse gases at Nederman’s customers by enabling energy Nederman works with self-assessing internal controls. Nederman
savings and/or compliance with emission requirements. suppliers are required to comply with the Nederman “Supplier
Code of Conduct” and supplier audits are planned, carried out and
CRITERIA FOR DO NO SIGNIFICANT HARM (DNSH) followed up by the purchasing units. Nederman has a functioning
Climate change adaptation (12): A risk assessment of the sites Whistleblower system.
where activity is carried out indicates that the climate risks mainly
relate to increasing temperatures and floods. Nederman’s facili- Identification method:
ties regularly undergo Insurance risk audits in which, among other When the turnover of these activities cannot be identified with
things, this type of risks are assessed. Nederman manages tem- precision, we use a conservative estimate.
perature changes with the help of adapted climate systems, insu-
lating glass or other types of temperature-regulating solutions. When capital expenditure and operating expenditure cannot be
Nederman’s former production facility in Thailand was affected by identified with precision, we allocate these in relation to turnover
floods, which led to a relocation of the facility to an area with less as a percentage.
risk of flooding, and the building has been equipped with flood dam
barriers. Accounting principles and Definitions:
Turnover is defined according to the group’s financial report; See
Water and marine resources(13): Water is not used in any form in note 6.
the manufacturing process, besides for hygiene and kitchen pur-
poses. Nederman does not conduct operations subject to a permit. Capital expenditure includes investments in assets that are
reported according to IAS 16 Tangible fixed assets, IAS 38 Intangi-
Circular economy (14): Nederman products generally have a long ble assets and additional rights of use according to IFRS16, leasing
lifespan and the company has a range of services to further opti- agreements. The amount includes assets acquired through busi-
mise the lifespan of the products. The production process causes ness combinations but excludes Goodwill; see note 13, 14, 15.
a relatively small amount of waste and the company uses recycled
material whenever possible. Operating expenses include costs for research and development,
renovation of buildings, short-term leases, maintenance and
Pollution (15): The Nederman business concept is about cleaning repair and other direct costs required for the efficient day-to-day
air from pollution, which means that the company actively contrib- operation of tangible fixed assets.
 DIREC TORS’ REPORT – SUSTAINABILIT Y   65

KEY PERFORMANCE INDICATORS FOR NON-FINANCIAL UNDERTAKINGS

Turnover

Substantial DNSH criteria

contribution criteria (Do No Significant Harm)

Taxonomy- Category

Code/codes (2)

Absolute turnover (3)

Proportion of turnover (4)

Climate change mitigation (5).

Climate change adaptation (6)

Water and marine resources (7)

Circular economy (8)

Pollution (9)

Biodiversity and ecosystems (10)

Climate change mitigation (11).

Climate change adaptation (12)

Water and marine resources (13)

Circular economy (14)

Pollution (15)

Biodiversity and ecosystems (16)

Minimum safeguards (17)

aligned (enabling
proportion activities or)
of turnover, (20)
Economic activities (1) year N (18)

SEKm % % % % % % % Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Percent Enabling

A. TAXONOMY-ELIGIBLE ECONOMIC ACTIVITIES

A.1. Environmentally sustainable (taxonomy-aligned) activities

Manufacture of other low-carbon technologies 3.6 330 6% 6% Yes Yes Yes Yes Yes Yes Yes 6% Enabling

Data-driven solutions for GHG

8.2 10 0% 0% Yes Yes Yes Yes Yes Yes Yes 0% Enabling
emissions reductions

Turnover of the environmentally sustainable

340 7% 7% 7%
(taxonomy-aligned) activities (A.1)

A.2. Taxonomy-eligible but not environmentally sustainable activities (not taxonomy-aligned activities)

Turnover of taxonomy-eligible but not

environmentally sustainable activities 0 0% 0% 0%
(not taxonomy-aligned activities) (A.2)

Total (A.1+A.2) 340 7% 7% 7%

B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

Turnover of taxonomy-non-eligible
4,839 93%
activities (B)

Total (A+B) 5,179 100%

Capital expenditure (CapEx)

Substantial DNSH criteria

contribution criteria (Do No Significant Harm)

Taxonomy- Category
Code/codes (2)

Absolute CapEx (3)

Proportion of CapEx (4)

Climate change mitigation (5).

Climate change adaptation (6)

Water and marine resources (7)

Circular economy (8)

Pollution (9)

Biodiversity and ecosystems (10)

Climate change mitigation (11).

Climate change adaptation (12)

Water and marine resources (13)

Circular economy (14)

Pollution (15)

Biodiversity and ecosystems (16)

Minimum safeguards (17)

aligned pro- (enabling

portion of activities or)
CapEx, year (20)
Economic activities (1) N (18)

SEKm % % % % % % % Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Percent Enabling

A. TAXONOMY-ELIGIBLE ECONOMIC ACTIVITIES

A.1. Environmentally sustainable (taxonomy-aligned) activities

Manufacture of other low-carbon technologies 3.6 14 4% 4% Yes Yes Yes Yes Yes Yes Yes 4% Enabling

Data-driven solutions for GHG

8.2 91 23% 23% Yes Yes Yes Yes Yes Yes Yes 23% Enabling
emissions reductions

Turnover of the environmentally sustainable

105 26% 26% 26%
(taxonomy-aligned) activities (A.1)

A.2. Taxonomy-eligible but not environmentally sustainable activities (not taxonomy-aligned activities)

CapEx of taxonomy-eligible but not

environmentally sustainable activities 0 0% 0% 0%
(not taxonomy-aligned activities) (A.2)

Total (A.1+A.2) 105 26% 26% 26%

B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

CapEx of taxonomy-non-eligible activities (B) 296 74%

Total (A+B) 401 100%

66   DIREC TORS’ REPORT – SUSTAINABILIT Y

KEY PERFORMANCE INDICATORS FOR NON-FINANCIAL UNDERTAKINGS, continued

Operating expenditure (OpEx)

Substantial DNSH criteria

contribution criteria (Do No Significant Harm)

Taxonomy- Category

Code/codes (2)

Absolute OpEx (3)

Proportion of OpEx (4)

Climate change mitigation (5).

Climate change adaptation (6)

Water and marine resources (7)

Circular economy (8)

Pollution (9)

Biodiversity and ecosystems (10)

Climate change mitigation (11).

Climate change adaptation (12)

Water and marine resources (13)

Circular economy (14)

Pollution (15)

Biodiversity and ecosystems (16)

Minimum safeguards (17)

aligned pro- (enabling
portion of activities or)
OpEx, year (20)
N (18)
Economic activities (1)

SEKm % % % % % % % Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Percent Enabling

A. TAXONOMY-ELIGIBLE ECONOMIC ACTIVITIES

A.1. Environmentally sustainable (taxonomy-aligned) activities

Manufacture of other low-carbon technologies 3.6 30 25% 25% Yes Yes Yes Yes Yes Yes Yes 25% Enabling

Data-driven solutions for GH

8.2 7 6% 6% Yes Yes Yes Yes Yes Yes Yes 6% Enabling
G emissions reductions

Turnover of the environmentally sustainable

38 31% 31% 31%
taxonomy-aligned) activities (A.1)

A.2. Taxonomy-eligible but not environmentally sustainable activities (not taxonomy-aligned activities)

OpEx of taxonomy-eligible but not

environmentally sustainable activities (not 0 0% 0% 0%
taxonomy-aligned activities) (A.2)

Total (A.1+A.2) 38 31% 31% 31%

B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

OpEx of taxonomy-non-eligible activities (B) 85 69%

Total (A+B) 123 100%

Economic responsibility
SEKm Definition 2022 2021

a) Revenue Turnover 5,179 4,042

Other income 25 48

Direct economic value generated 5,204 4,090

b) Operating costs -3,197 -2.403

c) Salaries and other remuneration to employees -1.515 -1.226
d) Payments to providers of capital Financial costs -52 -44
Dividend -123 -35
e) Payment to tax authorities -127 -110

Economic value distributed -5,014 -3,818

Economic value retained Generated - Distributed 189 272

Affiliated with the UN Global Compact

The UN Global Compact strives to mobilise a global movement of companies and stakeholders to
create a more sustainable world. To achieve this, the UN Global Compact supports companies in:

■ Conducting business in a responsible manner by adapting their strategies and operations to

the ten principles on human rights, work, the environment and anti-corruption.
■ Taking strategic action to promote broader social goals, such as the UN Sustainable
Nederman is affiliated with the UN Global Compact and
Development Goals, with the emphasis on cooperation and innovation. supports and works actively in accordance with its goals.
 DIREC TORS’ REPORT – SUSTAINABILIT Y   67

We work for a more 2,444

employees

sustainable future Nederman’s employees protect

people, planet and production from
the harmful effects of industrial
processes throughout the world.

12 competence and employee

product development
centres on three engagement 83%
continents (industry benchmark 80)

29% 91%
improved Review of sustainability
energy efficiency training aimed at 1,700
since 2021 employees of Nederman

Sustainability

45%
75%
credit facility
financing is in line with the
sustainability strategy and a
key factor in driving Nederman’s electricity consumption
sustainability agenda.
from renewable electricity

reduction of greenhouse gas emissions since

2014 from our production units connected to
their energy use and purchased electricity in

Nederman Sustainability Fund relation to sales

SEK 10 million per year

Nederman Sustainability Fund, which was established at the end of 2021, is designed to
encourage Nederman’s operations to make investments that support the sustainability
goals of both Nederman and the UN. All operations in Nederman group can apply for sup-
port for more sustainable investments from the fund, which amounts to SEK 10m per year.

In 2022, the fund received a large number of applications. The fund made contributions
to investments in solar power parks adjacent to the company’s operations, work environ-
ment improvements, such as desks for standing work, charging stations for electric cars,
218,000 kwh
replacement of energy-intensive lamps with LED lighting, improved possibilities for bike produced by own
storage and the charging of e-bikes. solar panels

95%
SmartFilter recycling of
Digital IoT-connected filters production
minimise energy consumption waste
and optimise air filtration.
68   DIREC TORS’ REPORT – SUSTAINABILIT Y

Nederman’s employees
Working at Nederman means being on The Clean Air CONTINOUS DIALOGUE AND TRAINING
Journey, an exciting voyage with a focus on creating the Internal communications are mainly conducted using the intranet
solutions of the future in air filtration and environmental communication platform, Tellus. It contributes to connecting the
technology. Put simply, helping to improve air in cities various parts of the organisation to make an entirety that works in
and communities the world over. unison towards the goal of creating clean air, customer value and
achieving Nederman’s vision.
To ensure that we have an organisation that is on the right path,
we carefully monitor the results from the questions in our annual myLearning, our platform for training and continuous develop-
employee survey, nGage, and that the activities that are related to ment in the group, contains manager support, plus role-based
improvements really are carried out. nGage encourages all teams training. myLearning supports all digital environments and
to develop action plans that improve and develop cooperation, enables the rapid onboarding of new employees and integration
leadership and health and safety. The tool has built-in support of corporate acquisitions.
for managers to communicate the result and discuss action plans
with their work group. In nGage 2022, one of the questions the Five courses are compulsory for employees to complete every sec-
employees had was to describe how they themselves can con- ond year – on the Code of Conduct, on the policy against corruption
tribute to better inclusion in the company. At the end of the year, and fraud, on GDPR (for Europe), on the policy for export controls
all managers were invited to an e-learning event on diversity and and sanctions, and on IT security. Approximately 95 percent of the
inclusion aimed at creating even better parameters for this work employees had completed these courses at year-end. 94 percent
in the organisation. In 2022, 85 percent (83) of all employees of employees in management positions (46 employees) had com-
responded to the survey. The overall Engagement Index was 83 pleted the anti-corruption and fraud policy training. In addition, it
(83) on a scale of 100, which is higher than the corresponding index is compulsory for the employees to complete the courses on sus-
for the comparative groups, Global Benchmark and Manufacturing tainability, Sustainability@Nederman, and on the strategy, career
Benchmark. appraisals and phishing. The compulsory training courses always
comprise part of the onboarding training for new employees,
which also includes training on Nederman and the company’s core
values, You@Nederman.
 DIREC TORS’ REPORT – SUSTAINABILIT Y   69

Sustainability is an integrated part of HR work and permeates all

areas from the communication of Nederman – the Clean Air Com-
pany – on recruitment to measuring commitment in conjunction
with the annual employee survey. The Sustainability@Nederman
course that describes the overall sustainability work at Nederman
is aimed at all employees.

The training portal, nPower, is offered to partners and resellers,

with access to eLearning courses and webinars. It contributes to
strengthening the knowledge level and facilitating dialogue.

Health and safety

The actual number of reported accidents in 2022 was 40 (24),
none of which had a fatal outcome or resulted in lifelong injuries.
The increase from the preceding year was attributable to higher Performance Management
activity, particularly in the US. The estimated values (based on
1,000,000 hours worked) according to the GRI definition of 403-
dialogue tool
9 are as follows: Accidents total = 9.89. Accidents with more than
six months recovery time = 0 and fatal accidents = 0. This includes
consultants and hourly employees. The total hours worked John Fields is responsible for the MikroPuls
amount to 4,045,184. equipment and aftermarket sales team in the US
and has used Nederman’s PM Dialog as a tool in
The most frequently recurring injuries comprise crush injuries, career appraisals with his employees.
cut injuries and fall injuries. Significant risks identified in produc-
tion that can lead to serious injury comprise work at height, crush The greatest challenge in ensuring the development
and cut injuries, electric shocks and forklift transport: these were of employees is to understand that it takes patience.
We live in a fast-moving society and we have become
identified through a self-assessment by the companies. There is
accustomed to immediate results. In process technol-
an action plan for each risk. Even if the accident frequency is low
ogy, each project is a little different to the last one. This
from an industrial perspective, Nederman is convinced that all means that not all lessons learned in past projects can
work-related accidents and diseases can be prevented. According- be applied to future projects. If it is also taken into con-
ly, the goal of eliminating all accidents stands firm. Achieving this sideration that the sales cycle can be longer for large
requires continued technical and organisational initiatives, such investment projects, it takes a few years to become an
as systems for identification, risk assessment and investigation of expert. Adding new tools to your own toolbox requires
incidents, risk observations, in order to prevent accidents and ill- time and patience.
health, as well as regular follow-up to ensure that measures have
I believe that a traditional performance assessment can
the intended effect, and training.
be stressful for people, even if they are doing a good
job. Having a process in which you address such general
To prevent accidents and disease companies use tools, process- subjects as future plans, the balance between work
es and training programmes that are aligned with each local man- and private life, health and well-being conveys to the
agement system and general legislation. Follow-up and report- employee that the company cares for him or her on a
ing of measures to evaluate whether they have the intended deeper level. The PM Dialog tool has integrated such a
structure with the process – a chance for an exchange
effect are conducted regularly at management level. Risk assess-
of information and ideas that would not usually be
ments are conducted regularly at all levels of the organisation
part of a traditional performance assessment. Based
and the personnel who implement these are trained. on this, there is subsequently the opportunity to
review the vision of the company, its goals and how
Each year, audits and rounds are conducted to assess the quality the employee contributes, meaning communication of
of risk management and take corrective and preventive action. sales targets, which resources are to be added, oppor-
The measures are to reduce or prevent the identified risks. Risk tunities for mentorship, etc.
assessments are reviewed and updated regularly or after an inci-
Discussions on the work-life balance and health and
dent has occurred.
well-being are the most interesting. I listen to employ-
ees telling me that they play guitar, sing in church
ABSENCE DUE TO ILLNESS choirs, like 80s music, take part in arm-wrestling con-
During 2022, the rate of absence due to illness averaged 2.6 per- tests, enjoy beach holidays and have been on a Disney
cent (2.6). Initiatives are focused on giving our employees the right cruise. I simply believe that they see this dialogue as a
conditions in their roles, and to ensure that they have a high sense good way of having an open discussion with no right
of well-being and are motivated and satisfied. or wrong answers. And it works. This broad and open
dialogue recently led to two of my employees being
promoted to management roles.
SOCIETAL BENEFITS
Our most important and long-term contribution to positive soci-
etal development are our products, which enhance air quality in
both the work environment and the local environment, which
reduces the risk of diseases, among other benefits.
70   DIREC TORS’ REPORT – SUSTAINABILIT Y

NUMBER OF EMPLOYEES The data shows the number of employees NUMBER OF EMPLOYEES
calculated in full-time equivalent in December BY REGION, 2022
2022. Consultants and hourly employees are
2500 mostly employees who work in the factory 1500
in production. To a lesser extent, it refers to
2000
consultants in IT and finance. The number
of consultants and hourly employees has 1000
1500
increased in 2022 by 36 compared to 2021,
1000 which is mainly due to increased activity in the
500
textile segment in APAC
500

0 The total number of employees at the end 0

2018 2019 2020 2021 2022 AMERICAS EMEA APAC
of 2022 was 2 444 (2 246). The number of
Varav konsulter och timanställda internal employees was 2 173 (2 011) and the The number of employees in Americas was
number of consultants and hourly employees 637 (487), in EMEA
Konsulter 1 144 (1 131) and in APAC
och timanställda
Anställda
was 271 (235). 663 (628).
Antal anställda
Totalt
Totalt
Total number of employees Employees Consultants and hourly employees

AGE DISTRIBUTION COMPANY AGE DISTRIBUTION EMPLOYEES, NUMBER

MANAGEMENT TEAMS, NUMBER
100 800

700
80
600

60 500

400 <20 years

40 300 20 - 30 years
200 31 - 40 years
20
100 41 - 50 years
0 0 >51 years
2022 2018 2019 2020 2021 2022

The outcome in 2022 was 1 (20) employees The outcome in 2022 was 15 (5) employees
<20 20-30 31-40 41-50 >51
who were between 20 and 30 years old, 14 who were under 20 years, 386 (345) employ-
(65) employees who
<20 were
21-30 31-40 between
41-50 >50 31 and ees who were between 20 and 30 years,
40 years old, 75 (72) employees who were 631 (606) employees who were between
between 41 and 50 years old and 66 (68) 31 and 40 years, 649 (611) employees who
employees who were over 51 years were between 41 and 50 years and 763 (679)
employees who were over 51 years.

“technical skill “generous scope for

is respected” self-development”

David McEwan Marcin Borun

Technical & Projects Director Automation Engineer,
Shanghai, China Helsingborg, Sweden

When I began at Nederman in Australia in 2012, the knowledge I began working at Nederman in Poland in 2019 as an automation
surrounding combustible dust, for example, was limited. I saw this as engineer at the Automation Competence Center (ACC). Prior to that, I
an opportunity to make a difference compared with our competitors, worked for three years on various projects connected with the energy
to help customers around Asia-Pacific to understand that employee industry. In Poland, I worked in an international team and was able to
safety is fundamental. And Nederman had just the solutions. My tech- learn a lot about various technical solutions. Above all, I was able to
nical and solution-oriented background contributed to my eventual demonstrate my skills and that was what resulted in me being offered
appointment as technology and project manager in China. This is a role a move to Helsingborg in May 2022 to work as an automation engineer
that mainly involves training and building confidence among person- in the product development department.
nel and customers using the technical knowledge and understanding I
have accumulated over the years. Something that I value most about my work is the generous scope
for self-development that it gives me. Nederman comprises a team
Nederman is the first company in my 36-year career at which I feel that of passionate people who not only work with the quality of products,
technical skill is respected at all levels. Something that is also highly service and materials, but also encourage us to actively and creatively
rewarding is the trust shown in us by our customers – that our values, participate in the development of the company. I want to recommend
our time and our knowledge are important . All of us who work at the to others that they adopt one of Nederman’s values, “the courage to
company should be proud of the Nederman name, the standards we do”. If you work with something that you truly regard as important,
set and what we deliver. To be able to make a difference. From safe- don’t feel any pressure, but have courage.
guarding the breathing zone of an individual worker to protecting the
environment by reducing industrial emissions.
 DIREC TORS’ REPORT – SUSTAINABILIT Y   71

EQUALITY, % PERCENTAGE OF WOMEN IN COMPANY PERSONNEL TURNOVER, %

MANAGEMENT TEAMS, %

100 100 50

80 80 40

60 60 30

40 40 20

20 20 10

0 0
0 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
2018 2019 2020 2021 2022

The outcome in 2022 was 19 (19) percent The outcome in 2022 was 8.8 (8.9) percent
Women Men in personnel turnover.
women in company management.

The outcome in 2022 was 21 (21) percent Other indicators of diversity such as minority
women and 79 (79) percent men. groups are not currently reported.

SHARE OF PRODUCTION STAFF, % SICK LEAVE, % ACCIDENTS, NUMBER

100
3.0 40
80 35
2.5
30
60 2.0
25

40 1.5 20

1.0 15
20
10
0.5
5
0
2018 2019 2020 2021 2022 0.0
2018 2019 2020 2021 2022 0
2018 2019 2020 2021 2022

The 2022 outcome was 44 percent (44). The goal for absence due to illness is set at The long-term goal is zero accidents. In 2022,
a maximum of 2.5 percent. The statistics 40 accidents (24) occurred, none of which
generally take acquisitions made over time into had a fatal outcome, resulted in lifelong
consideration. In 2022, absence amounted to injuries or had a recovery time of more than
2.6 percent (2,6). six months. From an industrial perspective,
the accident frequency rate is low.

“always be open “then everyone is filled

to change” with pride and energy”

Bora Siranli Joonas Alto-Setälä

Product Marketing Manager R&D Project Director
Charlotte, NC, USA Vantaa, Finland

My earlier role was that of project and sales engineer at Nederman in I gained my interest in R&D when I worked with electrical design for
Turkey. There, I was involved in technology projects, sales and busi- fire safety systems, at the Finnish company Marioff. I was amazed by
ness development, and also had the opportunity to make a global con- the research that formed the basis of getting the systems to work
tribution. This breadth of responsibility and contacts gave me insight effectively. This interest then eventually brought me to Gasmet and
into what I wanted. When I heard about the role of product marketing Nederman in 2019 and to a position as R&D Project Manager. In this
manager in the US, I applied immediately. My work today is cross-func- position, I was able to contribute to an improved launch process and to
tional in creating successful marketing and finding the openings that drive development projects in an organised manner. At the beginning
can create sales successes. This is also a market where there are good of 2022, I was then offered the chance to take over responsibility for
opportunities to both test and implement new ideas. managing the department and the projects.

I believe that diversity is a key factor in an organisation’s success. It The team spirit that exists within R&D, where everything is driven by
is highly stimulating to be in an environment with people who think a shared vision of improving our offering, makes it always inspiring
differently and challenge each other. Nederman is a company with to come to work. We work within many different areas, with varying
leaders who encourage an environment like this, which contributes types of challenges, which means learning something new every
to employee development. My advice to others is always be open to day. Something that I appreciate especially is when we have brought
change, challenge yourself and look for opportunities, quite simply a product all the way to a successful launch. This fills everyone with
dare to be yourself in different situations. pride and an energy that makes it easier to go on working with other
projects.
72   DIREC TORS’ REPORT – SUSTAINABILIT Y

GRI Index
2-1 Organisational details........................................................................................................................................................................................... 39, 77, 138-139
2-2 Entities included in the organisation’s sustainability reporting........................................................................................................................ 39, 57
2-3 Reporting period, frequency and contact point.................................................................................................................................................................99
2-4 Restatements of information...................................................................................................................................................................................................... 61
2-5 External assurance.....................................................................................................................................................................................................................57, 73
2-6 Activities, value chain and other business relationships.......................................................................................................................................38, 79
2-7 Employees...........................................................................................................................................................................................................................Exception*
2-8 Workers who are not employees.................................................................................................................................................................................................70
2-9 Governance structure and composition.........................................................................................................................................................................79, 87
2-10 Nomination and selection of the highest governance body....................................................................................................................................... 86
2-11 Chair of the highest governance body.....................................................................................................................................................................................87
2-12 Role of the highest governance body in overseeing the management of impacts..........................................................................86, 87, 89
2-13 Delegation of responsibility for managing impacts.................................................................................................................................................. 87, 89
2-14 Role of the highest governance body in sustainability reporting.............................................................................................................................57
2-15 Conflicts of interest...........................................................................................................................................................................................................................92
2-16 Communication of critical concerns................................................................................................................................................................................. 88, 89
2-17 Collective knowledge of the highest governance body.......................................................................................................................................... 15, 89
2-18 Evaluation of the performance of the highest governance body.................................................................................................................... 88, 89
2-19 Remuneration policies.....................................................................................................................................................................................................................90
2-20 Process to determine remuneration................................................................................................................................................................................. 87, 90
2-21 Annual total compensation ratio.............................................................................................................................................................................................108
2-22 Statement on sustainable development strategy............................................................................................................................................................57
2-23 Policy commitments.................................................................................................................................................................................................................. 55, 62
2-24 Embedding policy commitments................................................................................................................................................................................................63
2-25 Processes to remediate negative impacts............................................................................................................................................................................59
2-26 Mechanisms for seeking advice and raising concerns.....................................................................................................................................................59
2-28 Membership associations...............................................................................................................................................................................................................66
2-29 Approach to stakeholder engagement........................................................................................................................................................................... 63, 77
3-1 Process to determine material topics.......................................................................................................................................................................................63
3-2 List of material topics .......................................................................................................................................................................................................................62
3-3 Management of material topics.......................................................................................................................................................................................... 57-69
201-1 Direct economic value generated and distributed............................................................................................................................................................66
205-1 Operations assessed for risks related to corruption........................................................................................................................................................59
205-2 Communication & Education in anti-corruption policies................................................................................................................................................59
301-2 Recycled input materials used.....................................................................................................................................................................................................58
302-1 Energy consumption within the organisation............................................................................................................................................................. 60, 61
305-1 Direct (Scope 1) GHG emissions.................................................................................................................................................................................................... 61
305-2 Indirect (Scope 2) GHG emissions............................................................................................................................................................................................... 61
305-3 Other indirect (Scope 3) GHG emissions.................................................................................................................................................................................. 61
308-1 New suppliers that were screened using environmental criterias...........................................................................................................................59
403-1 Occupational health and safety management system............................................................................................................................59, 68-69, 71
403-2 Hazard identification, risk assessment, and incident investigation.................................................................................................59, 68-69, 71
403-3 Occupational health services................................................................................................................................................................................59, 68-69, 71
403-4 Worker participation, consultation, and communication on occupational health and safety ............................................59, 68-69, 71
403-5 Worker training on occupational health and safety...................................................................................................................................59, 68-69, 71
403-6 Promotion of worker health...................................................................................................................................................................................59, 68-69, 71
403-7 Prevention and mitigation of occupational health and safety impacts directly linked by business relationships...59, 68-69, 71
403-8 Workers covered by an occupational health and safety management system...........................................................................59, 68-69, 71
403-9 Work-related injuries..................................................................................................................................................................................................................69, 71
405-1 Diversity of governance bodies and employees..................................................................................................................................................59, 70, 71

* Nederman does not have the requested information available on GRI 2-7 in the detail required and therefore decided to make an exception in the
2022 report but intend to report according to the standard in 2023
 DIREC TORS’ REPORT – SUSTAINABILIT Y   73

Auditor’s Limited Assurance Report on

Nederman Holding Aktiebolag´s Sustainability
Report and statement regarding the Statutory
Sustainability Report
This is the translation of the auditor’s report in Swedish.
To Nederman Holding Aktiebolag, Corp.id. 556576-4205

INTRODUCTION
We have been engaged by the Board of Directors of Nederman The firm applies ISQC 1 (International Standard on Quality
Holding Aktiebolag to undertake a limited assurance engagement Control) and accordingly maintains a comprehensive system of
of Nederman Holding Aktiebolag’s Sustainability Report for the quality control including documented policies and procedures
year 2022. Nederman Holding Aktiebolag has defined the scope regarding compliance with ethical requirements, professional
of the Sustainability Report referred to on pages 72, the Statuto- standards and applicable legal and regulatory requirements. We
ry Sustainability Report is defined on page 57. are independent of Nederman Holding Aktiebolag in accordance
with professional ethics for accountants in Sweden and have
Responsibilities of the Board of Directors and the Executive otherwise fulfilled our ethical responsibilities in accordance with
Management these requirements.

The Board of Directors and the Executive Management are The limited assurance procedures performed and the examina-
responsible for the preparation of the Sustainability Report tion according to RevR 12 do not enable us to obtain assurance
including the Statutory Sustainability Report in accordance with that we would become aware of all significant matters that might
applicable criteria and the Annual Accounts Act respectively. The be identified in an audit. The conclusion based on a limited assu-
criteria are defined on page 72 in the Sustainability Report, and rance engagement and an examination according to RevR 12 does
are part of the Sustainability Reporting Guidelines published by not provide the same level of assurance as a conclusion based on
GRI (The Global Reporting Initiative), that are applicable to the an audit.
Sustainability Report, as well as the accounting and calculation
principles that the Company has developed. This responsibility Our procedures are based on the criteria defined by the Board of
also includes the internal control relevant to the preparation of a Directors and Executive Management as described above. We
Sustainability Report that is free from material misstatements, consider these criteria suitable for the preparation of the Sustai-
whether due to fraud or error. nability Report.

AUDITOR’S RESPONSIBILITY We believe that the evidence obtained is sufficient and appropria-
Our responsibility is to express a conclusion on the Sustainabi- te to provide a basis for our conclusions below.
lity Report based on the limited assurance procedures we have
performed and to express an opinion regarding the Statutory CONCLUSIONS
Sustainability Report. Our review is limited to the information in Based on the limited review performed, nothing has come to
this document and to the historical information and does therefo- our attention that causes us to believe that the Sustainability
re not include future oriented information. Report is not prepared, in all material respects, in accordance
with the criteria defined by the Board of Directors and Executive
We conducted our limited assurance engagement in accordance Management.
with ISAE 3000 (revised) Assurance engagements other than
audits or reviews of financial information. A limited assurance A Statutory Sustainability Report has been prepared.
engagement consists of making inquiries, primarily of persons 16 March 2023
responsible for the preparation of the Sustainability Report, and
applying analytical and other limited assurance procedures. Our Ernst & Young AB
examination regarding the Statutory Sustainability Report has
been conducted in accordance with FAR’s accounting standard
RevR12 The auditor’s opinion regarding the statutory sustaina-
bility report. A limited assurance engagement and an examina- Andreas Mast Outi Alestalo
tion according to RevR 12 is different and substantially less in Authorized public Specialist member
scope than an audit conducted in accordance with International accountant in FAR
Standards on Auditing and generally accepted auditing standards
in Sweden.
74   DIREC TORS’ REPORT – SUSTAINABILIT Y
 DIREC TORS’ REPORT – SUSTAINABILIT Y   75

Information on clean air and sustainability

ORGANISATIONS AND MEDIA REPORTS

Aktuell Hållbarhet Actions on Air Quality

Environment, sustainability and CRS for professionals and deci- A global summary of policies and programmes for
sion-makers. the reduction of air pollution.
aktuellhallbarhet.se wedocs.unep.org/bitstream/handle/
20.500.11822/36695/AAQ_ESG_EN.pdf
Dagens PS
News site with focus on business and entrepreneurship with EEA Air Quality in Europe 2021
environmental and sustainability reporting. eea.europa.eu//publications/air-quality-in-europe-2021
dagensps.se
State of Global Air
EEA European Environment Agency Annual report with global data and facts on the situation
Independent environmental information and statistics. for air and how it impacts our health.
eea.europa.eu stateofglobalair.org

EU Taxonomy
Measures and sustainability reporting to guide investments
towards sustainable operations. DATA / STATISTICS
ec.europa.eu/commission/presscorner
Air Quality Life Index
GHG Protocol Converts air pollution levels to life expectancy.
Establishes global frameworks to measure and manage emissions aqli.epic.uchicago.edu/the-index
of greenhouse gases (GHG).
ghgprotocol.org DI climate index
Listed companies’ reporting in accordance with Scope 1-3.
GRI Standards di.se/bors/klimatindex
Independent international organisation that provides the
world’s most used standards for sustainability reporting. European Air Quality Index
globalreporting.org Real-time graphics that show current air quality in your
particular area.
HEI Health Effects Institute eea.europa.eu/themes/air/air-quality-index
Independent organisation for research on air pollution
and health effects. Hållbara bolag
healtheffects.org Dagens Industri’s / Lund University’s annual sustainability ranking
detail/en/ip_21_1804 of listed companies.
di.se/hallbart-naringsliv/hela-listan-har-ar-borsens-mest-
IVL Svenska Miljöinstitutet hallbara-bolag-alla-kategorier
Independent research institute in environment and sustainability.
ivl.se IQ Air Visual
Real-time information for air quality.
Swedish Environmental Protection Agency iqair.com
Supports and collates the work to implement the government’s
environment policy. State of Global Air Data Set
naturvardsverket.se Interactive database for air quality and health effects.
stateofglobalair.org
UN Environment Programme
UN body with information and reports on environmental Sustainalytics
development at large. Independent calculation of companies’ ESG risks and sustainabil-
unep.org ity profiles.
sustainalytics.com
UN Global Compact
UN initiative and 17 sustainable development goals (SDGs) World Environment Situation Room
to mobilise a global movement of sustainable companies and Visual data, information and knowledge of the environment.
stakeholders. wesr.unep.org
unglobalcompact.org
76    DIRECTORS’ REPORT - THE NEDERMAN SHARE

The Nederman share

Nederman’s ambition is to continuously provide the financial markets, shareholders and other stakeholders with
accurate, consistent and relevant information in order to increase understanding of the group and comply with the
regulations for listed companies. The Nederman share has been listed on Nasdaq Stockholm under the NMAN ticker
since 16 May 2007. Since January 2014, the share has been listed on Nasdaq Stockholm Mid Cap. A brief history of the
company and its share is shown on the next page.

MARKET COMMUNICATION Latour. The table on the next page shows Nederman’s ownership
Nederman’s representatives meet regularly with analysts, structure at 31 December 2022.
credit providers and shareholders to give a continuous picture of
developments during the financial year. Interim reports, year-end DIVIDEND AND DIVIDEND POLICY
reports and annual reports are distributed to shareholders who so Nederman’s dividend policy is to pay a dividend amounting to
wish. These reports, together with the company’s press releases, 30–50 percent of net profit for the year, taking into account the
are also available on the website in Swedish and English. capital structure and acquisition plans. The Board of Directors pro-
poses a dividend of SEK 3.75 (3.50) per share for the 2022 financial
OWNERSHIP STRUCTURE year.
The number of shareholders at year-end was 4,239 (4,089). Each
share in Nederman entitles the holder to one vote. The share ANALYSTS WHO FOLLOW NEDERMAN
of Swedish ownership was 91.7 percent (92.7). The ten largest Anna L Widström from Handelsbanken,
shareholders accounted for 78.3 percent (79.4) of the total num- [email protected]
ber of shares. The largest individual shareholder is Investment AB

N S PA R
RA E
T

N
Q ESG

C Y PA R T

2022
DA

S N
ER
• NA

PRICE AND VOLUME TREND 2022 PRICE AND VOLUME TREND 2017-2022

250 240 250 1000

225 225 900

210
200 800
200 180
175 700
175 150
150 600

150 120 125 500

125 100 400

90
75 300
100 60
50 200
75 30
25 100

50 0 0 0
SEK JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC No. SEK 2018 2019 2020 2021 2022 No.
Nederman Share turnover per week, 000 Nederman Share turnover per month, 000
OMX Stockholm PI OMX Stockholm PI
Source:
Source:
 DIRECTORS’ REPORT – THE NEDERMAN SHARE 77

Data per share 2022 2021 2020 2019 2018*

Earnings per share after tax, SEK 9.37 8.70 3.15 6.43 5.78
Share price as at 31 December, SEK 172.4 218.0 141.0 134.4 90.0
Market capitalisation, SEKm 6,059.2 7,661.8 4,954.1 4,721.9 3,163.1
Cash flow, SEKm 133.1 42.1 67.0 -20.2 87.7
Proposed dividend per share, SEK 3.75 3.50 - - 2.30
Dividend resolved at an Extraordinary General Meeting of Shareholders, SEK - - 1.00 - -
Dividend growth, % 7.1 250.0 - - 15.0
Yield, % 2.18 1.61 - - 2.56
P/E ratio 18.4 25.1 44.8 20.9 15.6
Profit distributed as dividend, % 40 40 32 - 40
Equity, SEKm 2,186.5 1,717.4 1,300.8 1,382.0 1,234.9
Issued number of shares, 31 Dec 35,146,020 35,146,020 35,146,020 35,146,020 35,146,020
Proposed dividend as a percentage of equity, % 6.0 7.2 - - 6.5

Nederman’s major shareholders Shareholding Votes, % History

Investment AB Latour 10,538,487 29.98 1944 Company founded by Phillip Nederman.
Neudi kapital AB 3,525,000 10.03 1983 Listing on the Stockholm Stock Exchange.
IF Skadeförsäkring AB (publ) 3,481,200 9.90 1985 Active becomes the new majority shareholder. The company is delisted.
Swedbank Robur Fonder 2,937,047 8.36 1991 Nederman sold to Esab.
Fjärde AP-fonden 2,190,756 6.23 1994 Charter acquires Esab and becomes the new majority shareholder.
Cliens Fonder 1,796,963 5.11 1999 Venture capital company EQT acquires Nederman.
Lannebo fonder 1,431,843 4.07 2007 Listing on Nasdaq Stockholm.
Tredje AP-fonden 600,000 1.71 2010 Acquisition of Dantherm Filtration.
Handelsbanken fonder 569,123 1.62 2012 Acquisition of Environmental Filtration Technologies.
SIX SIS AG, W8IMY 432,472 1.23 2013 Nederman qualifies for Nasdaq Stockholm Mid Cap.
Other shareholders 7,643,129 21.76 2014 Nederman is moved to Nasdaq Stockholm Mid Cap.
Total 35,146,020 100.00 2017 Acquisition of NEO Monitors AS
2018 Acquisitions of Auburn FilterSense LLC and Luwa Air Engineering AG.
2019 Acquisition of Gasmet Technologies Oy
2021 Acquisition of Energy Save System Ltd
2022 Acquisitions of RoboVent, MBE AG and Ezi-Duct

Shareholders by category, % Shareholders per country, %

Financial companies 64.11 Sweden 91.69
Other Swedish legal entities 11.61 Finland 2.50
Foreign domiciled owners 8.31 USA 1.64
Social security funds 8.24 Switzerland 1.27
Private Swedish individuals 7.44 UK 1.18
Non profit organisations 0.26 Luxembourg 0.97
Other legal entities 0.02 Malta 0.28
Government 0.01 France 0.26
Total 100.00 Other 0.21
Total 100.00

DIVIDEND PER SHARE, SEK EARNINGS PER SHARE, SEK MARKET CAPITALISATION, SEKM
The 2022 dividend refers to the Board's
proposed dividend

4 10 8000
7000
3 8
6000

6 5000
2 4000
4 3000
1 2000
2
1000
0 0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022

*T
 he retrospective approach was applied in relation to IFRS 16 Leases and figures for 2018 are therefore restated pursuant to the new standard.
78    DIRECTORS’ REPORT - FIVE-YEAR OVERVIEW
 DIRECTORS’ REPORT - REVIEW OF BUSINESS OPERATIONS   79

Review of business operations

The Board and CEO of Nederman Holding AB (publ), corporate toring services, capturing devices, fans, high-vacuum products
registration number 556576-4205, have prepared the annual and reels for the distribution of a variety of liquids and compressed
report for the 2022 financial year. air. Nederman Process Technology offers services and advanced
filter solutions that are integrated into the customers’ production
BUSINESS processes where they catch harmful particles and gases. Ned-
Nederman is an environmental technology company and one erman Duct & Filter Technology sells different types of ducting
of the world’s leading suppliers of products and solutions for systems, valves and filter elements to ensure good air quality in
advanced air filtration in demanding industrial environments. Ned- a number of industries. Nederman Monitoring & Control Technol-
erman’s business concept is clean air. Our offering comprises indi- ogy’s digital offering includes advanced measurement technol-
vidual products, complete solutions, project design, installation, ogy and an IoT platform that consists of hardware and software
commissioning and service. The company’s products contribute that provide customers with information and insight into critical
to reducing the environmental impact from industrial production, parameters and processes. On a secondary level, the operations
creating clean and safe working environments, and increasing are monitored based on the following regions: EMEA (Europe, Mid-
production efficiency. Nederman’s customers operate within such dle East and Africa), Americas (North and South America) and APAC
industries as metal, wood and composite processing, food produc- (Asia-Pacific).
tion, pharmaceutical production, waste management, agriculture,
the textile industry, the chemicals industry, the process industry, Finance, IT, HR, Sustainability and Strategy & Business Develop-
energy production and the automotive industry aftermarket. To ment are group functions with the task of supporting operation-
realise its financial targets, Nederman works in accordance with al activities and being responsible for global coordination within
a market-driven agenda: market-driven organisation, global key each function.
costumers, product development with digital focus and active
acquisition strategy. STOCK EXCHANGE LISTING
The Nederman share has been listed on Nasdaq Stockholm under
Nederman has a strong global presence in sales and manufactur- the NMAN ticker since 16 May 2007. Since January 2014, the
ing. Sales are conducted through our own sales companies and share has been listed on Nasdaq Stockholm Mid Cap. The Mid Cap
distributors in over 50 countries. Most sales take place in Europe segment includes companies that have a market capitalisation
and North America, although Nederman is also active in a number between EUR 150 million and EUR 1 billion. As of 31 December
of markets in Asia and South America. Manufacturing is carried 2022, there were 4,239 (4,089) shareholders.
out on five continents. Units for production and assembly are
located in Australia, Brazil, Denmark, Finland, India, China, Norway, ACQUISITION OF BUSINESS OPERATIONS
Poland, the UK, Sweden, Thailand, Germany and the US. At the end Ezi-Duct
of 2022, 17 out of 21 production units were certified according to On 28 April 2022, Nederman acquired the business of the Austra-
ISO 9001 and 16 of 21 units were certified according to ISO 14001. lian company Ezi-Duct Pty Ltd. In conjunction with the acquisition,
Certification of additional units is planned during 2023. The parent the company Nordfab Pty Ltd was formed. The acquisition price
company is also certified according to ISO 9001 and ISO 14001. The amounted to SEK 18.0m, of which SEK 4.8m constituted a condi-
manufacturing and assembly units are responsible for manufac- tional deferred payment, which is expected to be paid 12 months
turing, distribution, product care, logistics, purchasing and quality after the date of acquisition. Nordfab Pty Ltd manufactures and
systems. supplies ducting, fume extraction and industrial air filtration
equipment. With this acquisition, Nederman improves its product
GROUP STRUCTURE range and market presence in Australia. Nordfab is based in Syd-
Nederman Holding AB (publ) is the parent company of Nederman ney, Australia. Nordfab’s sales and profitability were not material
group with its registered office in Helsingborg, Sweden. Neder- for the group in 2022.
man Holding AB’s directly or indirectly wholly owned subsidiaries
are presented in the parent company’s note 13, Shares and partic- RoboVent
ipations. On 29 July 2022, Nederman acquired 100 percent of the shares
in the North American company RoboVent. The acquisition price
The Nederman group’s operations are conducted in four operating amounted to SEK 441.8m. RoboVent is the leader in air filtration
segments: Nederman Extraction & Filtration Technology, Neder- technology and control solutions for industrial fume, dust and oil
man Process Technology, Nederman Duct & Filter Technology and mist control applications. Its unique sales approach, strong equip-
Nederman Monitoring & Control Technology. This organisation is ment range and turnkey capabilities have built a strong brand and
based on technology, customer structure and business logic with global reputation. RoboVent is headquartered in Sterling Heights,
its starting point in the group’s trademarks. This means that the Michigan, and has about 100 employees. Sales in 2022 amounted
operating segments are global. Nederman Extraction & Filtration to SEK 356m. RoboVent is part of Nederman’s Extraction & Filtra-
Technology develops and sells a broad range of filters and moni- tion Technology Division.
80    DIRECTORS’ REPORT - REVIEW OF BUSINESS OPERATIONS

MBE AG more challenging in 2022 following an initial phase of strength-

On 3 November 2022, Nederman acquired 100 percent of the ened interest in digital monitoring and control of production
shares in the Swiss company MBE AG. The acquisition price process­es after the pandemic. The business displayed continued
amounted to SEK 19.9m, of which SEK 4.4m constituted deferred growth in orders and sales and a high rate of product develop-
payment, which is expected to be paid 24 months after the date ment, but chal­lenges in obtaining finished goods and components
of acquisition. For more than 35 years, MBE has sold gas measure- in normal time had a negative impact on business activity and prof-
ment instruments and services for gas detection technology and itability. The shortage of components also led to increased costs
continuous monitoring of liquid processes to the Swiss market. Its for input goods. In addition, the continued extensive covid-19-re-
range comprises gas measurement technology for a number of dif- lated lockdowns in China affect­ed sales activities and resulted in
ferent applications, from gas sampling and specific gas treatment delays to the projects being sup­plied by the division.
to appropriate gas measurement instruments. With its knowl-
edge, market presence and customer base, it has built a strong In April 2022, Nederman’s Board resolved on a new long-term prof-
market position. For many years, MBE has been a key distributor itability target. The new target is to achieve an adjusted EBITA
for Gasmet. As a result of this acquisition, Nederman’s Monitoring margin of at least 14 percent. This decision was a result of the con-
& Control Technology division is establishing direct sales in Swit- tinued significant increase in Nederman’s profitability, combined
zerland and creating a platform for future growth in the market with a large order backlog. Due to the increased sales, profitabil-
there. MBE is based in Wetzikon, Switzerland. MBE’s sales and prof- ity in SEK is expected to continue to grow. The long-term targets
itability were not material for the group in 2022. communicated earlier of annual sales growth over a business cycle
in excess of 10 percent, return on operating capital of 15 percent
ORDERS RECEIVED AND SALES and a dividend policy of 30-50 percent of net profit for the year,
Orders received amounted to SEK 5,424.8m (4,622.9), equivalent stand firm.
to currency neutral growth of 9.1 percent compared with 2021.
Sales amounted to SEK 5,178.9m (4,041.8), equivalent to currency PRODUCT DEVELOPMENT
neutral growth of 18.5 percent compared with 2021. The group’s total research and development expenses amounted
to SEK 126.4m (98.0), of which SEK 53.9m (41.0) was capitalised in
PROFIT/LOSS the statement of financial position, and primarily related to invest-
Consolidated operating profit for 2022 totalled SEK 480.2m ments in the group’s digital product offering and the development
(458.9), corresponding to an operating margin of 9.3 percent of laser and gas analysis instruments.
(11.4). Adjusted EBITA amounted to SEK 566.6m (494.6). The
adjusted EBITA margin was 10.9 percent (12.2). Profit before tax INVESTMENTS IN FIXED ASSETS
amounted to SEK 438.8m (417.1). Net profit totalled SEK 328.7m AND DEPRECIATION/AMORTISATION
(305.3), corresponding to earnings per share of SEK 9.37 (8.70). The group’s capital expenditure in intangible assets for the year
amounted to SEK 97.6m (69.8). Capital expenditure for the year
Nederman’s positive development continued during 2022. All four was primarily related to the group’s digital product offering and
divisions grew their sales and for the group in its entirety, sales the implementation of a global business system. Amortisa-
exceeded SEK 5 billion. The Group achieved its highest operating tion of intangible assets for the year totalled SEK 78.0m (63.4).
profit ever, but continued challenges in the supply chain, inflation- The group's capital expenditure in tangible assets for the year
ary pressure and bad debt losses, primarily in China, resulted in the amounted to SEK 72.9m (39.2) and was primarily related to the
lower operating margin compared with the preceding year. expansion of Nordfab’s production and warehouse facility in
Thomasville, in the US. Depreciation of tangible assets for the year
It was another good year for Nederman Extraction & Fil­tration was SEK 44.7m (37.9).
Technology where sales and orders received increased to new
record levels while the division made a major strategic acquisition CASH FLOW
of RoboVent, launched a new mar­ket concept and secured large Cash flow for the year amounted to SEK 133.1m (42.1) and cash
orders from new customer industries. The business was affected flow from operating activities to SEK 345.7m (519.8). Cash flow
to a certain extent by problems in the logistics chain, mainly relat- remains strong but a number of factors had a negative impact in
ed to purchasing of electronics, and by rising prices of raw materi- 2022. The foremost reasons for the deterioration in cash flow
als and the general increase in inflation in the economy which has were lower levels of advance payments in major projects, which
led to a slightly weaker adjusted EBITA margin. Nederman Process were at record levels in 2021 as a result of strong orders received,
Technology achieved new successes with strong support from a and higher inventory levels due to increased raw material prices.
record order backlog in recent years which encompassed all of Other changes significantly impacting cash flow in investing activ-
the division’s markets and segments, apart from China. Sales and ities were attributable to the acquisition of RoboVent and higher
profit­ability improved considerably and cash flow was strong, at investments in fixed assets. Cash flow from financing activities
the same time as the division was successful in grow­ing in both was mainly attributable to the increase in borrowing by SEK 606m.
new segments and in new markets. It was once again a successful
year for Nederman Duct & Filter Technology which has strength- LIQUIDITY AND FINANCIAL POSITION
ened its customer base and market-leading position, leading to At the end of the period, the group had SEK 721.2m in cash and
new record levels of both orders received and sales. Profitability cash equivalents, as well as SEK 108.4m in unutilised overdraft
was positively affected by higher sales volumes and price adjust- facilities. The group has a financing agreement with Skandina-
ments but negatively by, among other factors, production and viska Enskilda Banken (SEB) and Svenska Handelsbanken (SHB)
inventory issues in ducting systems ope­rations in the US. For Ned- for SEK 2,000m and a financing agreement with the Swedish
erman Monitoring & Control Technology the trend was somewhat Export Credit Corporation (SEK) for SEK 500m. The agreements
 DIRECTORS’ REPORT - FIVE-YEAR OVERVIEW   81

have a three-year maturity with extension options for two addi- Based on the group’s financial stability and healthy capital struc-
tional years. The agreements mature in March 2027 on exercise ture, the Board’s assessment is that a dividend can be justified.
of the option. At the end of the year, the scope within the agree- After payment of the dividend, the group’s equity ratio amount to
ment with SEB and SHB had been utilised in an amount of SEK 33.8 percent and is therefore good in relation to the industry sec-
1,438m (1,008). Accordingly, at the end of the period, the group tor in general. The dividend corresponds to 40 percent of net profit
had a credit facility of SEK 562m (492) within the scope of Neder- for the financial year, meaning that the dividend is in line with the
man’s loan agreement with SEB and SHB. At the end of the year, company’s dividend policy.
the scope within the agreement with SEK had been fully utilised.
During the year, borrowing increased by SEK 606m (-248). Under NOTICE OF ANNUAL GENERAL MEETING
certain conditions, the banks are entitled to terminate the agree- The notice to attend the Annual General Meeting is to be issued
ments early. no earlier than six weeks and no later than four weeks prior to the
Meeting.
Net debt amounted to SEK 1,477.1m (1,067.8). Equity amounted
to SEK 2,186.5m (1,717.4), corresponding to an equity/assets ratio EVENTS AFTER THE END OF THE REPORTING PERIOD
of 35.2 percent (36.3) and a net debt/equity ratio of 67.6 percent No significant events have occurred after the end of the reporting
(62.2). The net debt/equity ratio increased compared with the period.
preceding year, which is a result of the fact that net debt increased
more in relation to equity. The higher level of net debt was primar- OUTLOOK
ily due to additional borrowing of SEK 606m. The weakened SEK Demand and orders received in the fourth quarter were good,
also led to a translation effect on foreign currency loans, increas- although organic growth for the group as a whole slowed further.
ing net debt by SEK 24m. In comparison with the preceding year, Our base business and strong digital offering enable us to assert
the pension liability decreased by SEK 32m, which was primarily a ourselves well in the current market. In parallel, we see that the
consequence of an increase in the discount rate. The lease liabili- problems in our supply chain combined with rising inflation are
ty was in line with the preceding year. The cash balance continued impacting customers’ investment decisions and the possibility
to strengthen due to continued healthy orders received, with of conducting business, as well as our own production and ability
advance payments received as a result. to deliver. In addition, continued geopolitical uncertainty had a
negative effect. However, we remain cautiously optimistic about
Equity was strengthened during the year as a consequence of the coming year in view of, for example, our strong order backlog.
favourable profitability. In addition, equity was impacted by Although various factors may temporarily contribute to a damp-
the weakened SEK, which led to the translation reserve, attrib- ened outlook in our industry, Nederman’s long-term potential
utable to the translation of foreign subsidiaries, amounting to continues to strengthen. In a world in which insight into the dam-
SEK 236m (131). age that poor air does to people is increasing, Nederman, with its
leading industrial air filtration offering, has a key role to play and
EMPLOYEES good possibilities for growth. Technological advances, centering
The group had 2,444 (2,246) employees at year-end. The aver- around digitalisation, have led to completely new possibilities to
age number of employees in the group during the year was 2,288 streamline and optimise the air filtration process. Together with
(2,154). Other personnel data is shown in note 8, Employees. political insight and a willingness to set stricter limits and legisla-
tion, this creates a basis for a viable future manufacturing industry
PARENT COMPANY that contributes to sustainable air quality around the world, bene-
The activities of the parent company comprise group functions. fiting both people and society.
The parent company also owns and manages shares in the subsid-
iaries. The parent company’s sales amounted to SEK 19.4m (26.4)
and pertained to service revenue from subsidiaries. Profit for the
period amounted to SEK 109.8m (210.5). The decrease compared
with the preceding year was mainly attributable to the lower level
of dividends from the subsidiaries.

PROPOSED APPROPRIATION OF PROFIT

The following is at the disposal of the Annual General Meeting of
Nederman Holding AB (publ):

Share premium reserve 5,866,700

Retained earnings 513,733,621
Net profit for the year 109,808,839
Total SEK 629,409,160

The Board of Directors proposes

that a dividend of SEK 3.75 per share
be paid to shareholders* 131,599,110
to be transferred to the share premium reserve 5,866,700
to be transferred to retained earnings 491,943,350
Total SEK 629,409,160

* Based on the number of shares outstanding at 31 December 2022. The dividend

amount could be changed as treasury shares could be converted by the record
date of 14 April 2023. For additional information about number of issued shares
and treasury shares held see the Group’s note 20, Equity and number of shares.
82    DIRECTORS’ REPORT - FIVE-YEAR OVERVIEW

Five-year overview
SEKm 2022 2021 2020 2019 2018*
Operating revenue and earnings
Net sales 5,178.9 4,041.8 3,674.8 4,307.7 3,553.9
EBITA 558.2 522.3 275.7 388.1 340.8
Adjusted EBITA 566.6 494.6 352.3 394.0 354.0
EBITDA 682.0 633.2 384.6 489.9 426.9
Adjusted EBITDA 690.4 605.5 461.2 495.8 440.1
Operating profit 480.2 458.9 219.0 343.2 305.7
Adjusted operating profit 488.6 431.2 295.6 349.1 318.9
Profit before tax 438.8 417.1 148.5 307.3 267.5
Net profit 328.7 305.3 110.4 225.8 202.8

Assets, equity and liabilities

Fixed assets 3,358.8 2,645.6 2,480.8 2,647.7 2,000.2
Current assets 2,861.3 2,083.4 1,768.7 2,102.6 2,020.3
Cash and cash equivalents 721.2 541.6 466.8 445.3 463.9
Equity 2,186.5 1,717.4 1,300.8 1,382.0 1,234.9
Interest-bearing liabilities 2,198.3 1,609.4 1,917.3 2,009.4 1,251.5
Non-interest-bearing liabilities and provisions 1,835.3 1,402.2 1,031.4 1,358.9 1,534.1
Balance sheet total 6,220.1 4,729.0 4,249.5 4,750.3 4,020.5

Profitability
EBITA margin 10.8% 12.9% 7.5% 9.0% 9.6%
Adjusted EBITA margin 10.9% 12.2% 9.6% 9.1% 10.0%
EBITDA margin 13.2% 15.7% 10.5% 11.4% 12.0%
Adjusted EBITDA-margin 13.3% 15.0% 12.6% 11.5% 12.4%
Operating margin 9.3% 11.4% 6.0% 8.0% 8.6%
Adjusted operating margin 9.4% 10.7% 8.0% 8.1% 9.0%
Return on equity 16.8% 20.2% 8.2% 17.2% 17.7%
Return on operating capital 15.2% 15.6% 10.4% 14.0% 16.5%
Capital turnover rate, multiple 1.6 1.5 1.3 1.7 1.8

Capital structure
Net debt 1,477.1 1,067.8 1,450.5 1,564.1 787.6
Net debt/equity ratio 67.6% 62.2% 111.5% 113.2% 63.8%
Net debt/adjusted EBITDA, multiple 2.1 1.8 3.1 3.2 1.8
Adjusted EBITDA/net financial items, multiple 16.7 14.5 6.5 13.8 11.5
Interest cover ratio, multiple 7.9 9.6 4.1 8.1 7.5
Equity/assets ratio 35.2% 36.3% 30.6% 29.0% 30.7%
Operating capital 3,663.6 2,785.2 2,751.3 2,946.1 2,022.5

Share data
Number of shares on closing date 35,146,020 35,146,020 35,146,020 35,146,020 35,146,020
Average no. of shares during the year, before dilution 35,093,096 35,093,096 35,093,096 35,093,096 35,088,753
Average no. of shares during the year, after dilution 35,093,096 35,093,096 35,093,096 35,093,096 35,088,753
Equity per share, before dilution, SEK 62.31 48.94 37.07 39.38 35.19
Equity per share, after dilution, SEK 62.31 48.94 37.07 39.38 35.19
Earnings per share, before dilution, SEK 9.37 8.70 3.15 6.43 5.78
Earnings per share, after dilution, SEK 9.37 8.70 3.15 6.43 5.78
Proposed dividend per share, SEK 3.75 3.50 - - 2.30

Emplyees
Average numbers of emplyees 2,288 2,154 2,097 2,195 1,852

*The retrospective approach was applied in relation to IFRS 16 Leases and figures for 2018 are therefore restated pursuant to the new standard.
 DIRECTORS’ REPORT - FIVE-YEAR OVERVIEW   83

SALES, SEKM OPERATING PROFIT AND OPERATING MARGIN AND

ADJUSTED EBITA, SEKM* ADJUSTED EBITA MARGIN, %
6000 600 14

5000 500 12

10
4000 400
8
3000 300
6
2000 200
4

1000 100 2

0 0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022

Operating profit
Justerat EBITA Operating margin
Justerat EBITA
Adjusted EBITA Adjusted EBITA margin
Rörelsemarginal
Rörelseresultat

CASH FLOW, SEKM* NET DEBT/EQUITY RATIO, %* RETURN ON OPERATING CAPITAL, %*

From operating activities

600 120 20

500 100
15
400 80

300 60 10

200 40
5
100 20

0 0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022

EARNINGS PER SHARE, SEK LARGEST MARKETS IN 2022, SEKM AVERAGE NUMBERS OF EMPLOYEES
External sales

10 1500 2500

8 1200 2000

6 900 1500

4 600 1000

2 300 500

0 0 0
2018 2019 2020 2021 2022 US Germany China India UK Sweden 2018 2019 2020 2021 2022

*The retrospective approach was applied in relation to IFRS 16 Leases and figures for 2018 are therefore restated pursuant to the new standard.
84   DIRECTORS’ REPORT – RISKS AND RISK MANAGEMENT

Risks and risk management

RISKS THAT COULD SIGNIFICANTLY IMPACT THE GROUP COMPLIANCE RISKS
Nederman is exposed to a number of risks that could significant- Compliance with laws, regulations and group policies relating to,
ly impact the group’s operations, earnings and financial position. for example, data confidentiality, competition legislation, corrup-
Nederman conducts continuous risk assessments that include tion, health and safety and sustainability.
identifying the risks that impact the group and taking measures to
manage these risks. FINANCIAL RISKS
Currency, interest, credit and liquidity risks.
Nederman does not calculate the economic value of all risks
because many of them are highly complex and interrelated. How- CYBER AND INFORMATION RISKS
ever, the practical management of these risks is facilitated in sev- Cyber and information risks related not only to technology in the
eral different ways, including through group-wide policies, busi- products, solutions and services that Nederman provides to its
ness processes, training, internal controls, and processes for the customers, but also all technology and information used in the
audit and approval of reports, which are all coordinated and moni- company’s internal and external processes and operations.
tored by each group function. The risks are summarised below.
MANAGING THE MAIN RISKS
STRATEGIC RISKS The main risks described in this report are managed in accordance
Customer offerings, succession planning, official or sector regula- with Nederman’s framework for risk management, which is inte-
tions, fluctuations in the global market. grated with the company’s business processes. The Board of
Directors also reviews the company’s risk management.
OPERATING RISKS
Demands on the products’ function or quality, competition or tech-
nology shifts, IT systems, and production or delivery disruptions.

Strategic risks Management

Loss of key personnel Continued succession planning. Incentivising, motivating and developing
key personnel.

Acquisition-related risks Professional due diligence. A clear divisional fit for acquired companies,
standard onboarding procedures including for IT, brands, patents and
finance.

Operating risks Management

IT security Updating and upgrading hardware, software and processes in accordance
with the group IT security policy. Compulsory training for all employees.
Monitoring of systems, testing to identify areas of vulnerability, securing
and testing of backups.

Production risks at key sites Updating and replacing aging production machinery and equipment,
global management system, standardisation of processes – a prerequisite
for ERP roll-out, maintaining product documentation, updating of IT
hardware and software.

Supply risk for key components Production rationalisation projects, audits of critical suppliers, increased
inventory of key components.

Ongoing IT projects Systematic planning, securing relevant internal competence updating IT

hardware and software.

External factors, such as fire, extreme weather conditions, natural Continued contingency planning, regular risk assessments and site
disasters, war or pandemics inspections.
 DIRECTORS’ REPORT – RISKS AND MANAGEMENT   85

Compliance risks Management

Corruption and fraud Established policies and internal control, whistleblower system where
any employee can report any suspicions of legal or regulatory breaches
without reprisal, compulsory training including on the Nederman Code of
Conduct.

Non-compliance with laws and regulations Training in policies, laws and regulations, formalisation and expansion
of the group’s internal control work with a focus on compliance, export
control process including compulsory training, with a focus on sanctions
and trade restrictions.

Health and safety risks relating to, for example, technical defects or Nederman’s commitment to quality assurance to ensure that product
deficiencies in Nederman's products quality and functionality, ensuring that legal requirements regarding
safety are complied with in full.

Financial risks Management

Underlying weakening of the economy Continual updating of contingency plans, on local, regional and global
levels.

Material price increases Increasing production efficiency, purchasing coordination across group
companies, close monitoring and management of sales and purchase
pricing.

Price competition Differentiation including digital products and solutions, market leading
technology, focus on being market leader in operational markets,
increasing production efficiency including from machinery investments
and IT upgrades.

Foreign currency risks: The Nederman group’s global presence means To reduce the currency exposure balancing of income and expenses,
that business is conducted in several different currency regions. The assets and liabilities are pursued. Some individual major projects can be
Nederman group is exposed to currency risk since exchange rate hedged to create certainty of future cash flows.
fluctuations affect the group’s income, financial position and cash flow.
Approximately 95 percent of the Group’s net sales are generated in
countries other than Sweden.

Interest rate risks: The Nederman group is exposed to fluctuations in The group’s bank loans have floating interest rates or a maximum term of
market interest rates due to the net debt. Movements in interest-rate six months, according to the funding agreement with the group’s lenders.
levels may impact the group’s net income and cash flow and the value of The usual fixed interest term is between one and three months. A change
financial assets and liabilities. in the interest rate of 1 percentage point would have affected net financial
items in 2022 by SEK 12.7m (12.6), calculated on average net debt for the
year. The Nederman group has determined that reasonable changes in
interest rates do not affect the group’s earnings to such a material extent
that there is a need to secure interest rates through financial instruments.
This assessment is updated on an ongoing basis.

Credit risks: The risk that the group’s customers might not pay their To limit the credit risk, the Nederman group employs credit policies that
accounts receivable and contract assets constitutes a customer credit limit outstanding amounts and the credit period for different customers.
risk. Contract assets consist of work performed that have not yet been In major projects advance payments normally apply according to the fixed
invoiced, which are mainly referring to sale of small and medium-sized payment plans in the agreements. For established customer relationships,
projects, which by its nature constitute a credit risk. If several of the credit limits are carefully monitored to limit the risk. In some cases, credit
group´s larger customers fails to meet its undertakings the group could insurance is used to secure accounts receivable. Ongoing risk assessments
suffer significant losses. are carried out of accounts receivable and contract assets, and given that
customers operate in several different industries and markets, the risks
are deemed to be low. For 2022 the group’s largest individual customer
accounted for one percent of sales and the five largest customers
accounted for four percent of sales, which means that the risk spread can
be regarded as very good.

Liquidity risks : The risk that the Nederman group may be unable to finance The group has a financing agreement with Skandinaviska Enskilda
or refinance its assets or meet its payment obligations constitutes a Banken (SEB) and Svenska Handelsbanken (SHB) for SEK 2,000m and
liquidity risk. It is of critical importance that the group meets its covenants a financing agreement with the Swedish Export Credit Corporation
according to the financing agreements with the banks and assure a (SEK) for SEK 500m. The agreements have a three-year maturity with
sufficient payment capability over time. Challenges in the marker with extension options for two additional years. The agreements mature in
increased inflation and higher interest rates, can impact customers March 2027 on exercise of the option. The group had SEK 721m in cash
willingness to invest with reduced demand as a result, may stress the and cash equivalents, SEK 108m in unutilised overdraft facilities and
group’s liquidity. Failure to properly manage the group’s liquidity risks, SEK 562m in credit facility within the framework of Nederman’s loan
may cause material adverse impact on earnings capability and financial agreement with SEB and SHB. Accordingly, there were available funds
standing. totalling SEK 1,391m on 31 December 2022. All covenants were fulfilled
on the balance sheet date.
86   DIRECTORS’ REPORT – CORPORATE GOVERNANCE

Corporate Governance
Nederman Holding AB (publ) is a Swedish public limited compa- the 2022 financial year would be SEK 3.50 per share, correspond-
ny with its registered office in Helsingborg, Sweden. Nederman ing to SEK 122.8m, and SEK 528.9m would be carried forward.
was listed on the Nasdaq Stockholm Small Cap list in 2007 and
has been registered on the Nasdaq Stockholm Mid Cap list since The Meeting also authorised the Board to decide that the compa-
1 January 2014. ny may issue new shares or repurchase the company’s own shares.
The Meeting also resolved to adopt the Remuneration Report.
As a listed company, Nederman applies the Swedish Corpo-
rate Governance Code (the Code). The Corporate Governance The Meeting decided in accordance with the proposal in the noti-
Report has been prepared in accordance with the Swedish fication of the Meeting to elect six Board members. In accordance
Annual Accounts Act and the Swedish Companies Act, Nas- with the proposal of the Nomination Committee, Gunilla Fransson,
daq Stockholm’s Rule Book for Issuers, the Code, and other Ylva op den Velde Hammargren, Johan Menckel, Sam Strömerstén
applicable Swedish laws and regulations. In addition to rules pur- and Sven Kristensson were re-elected to the Board, alongside
suant to laws or other legislation, Nederman uses internal control the first-time election of Anna Kinberg Batra. Johan Menckel was
instruments that are also the basis for the group's corporate gov- elected Chairman of the Board.
ernance, including the Articles of Association, rules of procedure
for the Board of Directors, the terms of reference for the CEO, On 3 February 2023, it was announced that Anna Kinberg Batra
policy documents and the group’s Code of Conduct. The Articles had relinquished her seat on the Board as a consequence of
of Association and the group’s Code of Conduct are available at being appointed by the government to the position of Governor
nedermangroup.com and policy documents are available at the of Stockholm County. Following Anna Kinberg Batra’s departure
group’s intranet. from the Board, it comprises five members and thereby meets the
requirements of the Articles of Association.
Governance of the Nederman group takes place through the
shareholders via the General Meeting of Shareholders, the Board NOMINATION COMMITTEE
of Directors, the CEO and Group management of Nederman in The 2019 Annual General Meeting decided to establish instruc-
accordance with, among other things, the Swedish Companies tions for the Nomination Committee concerning the composition
Act, other laws and regulations, the Articles of Association and of the committee and its assignments. According to the instruc-
the rules of procedure for the Board of Directors. Considering tions, the Nomination Committee is to consist of one representa-
Nederman's group structure, the composition of the boards of its tive from each of the four largest shareholders and the Chairman
operating subsidiaries, which often include representatives from of the Board. If any of the four largest shareholders waives their
Group management, constitute another element of governance right to appoint a representative to the Nomination Committee,
for the group. the right will pass to the next largest shareholder. The Nomination
Committee’s tasks are to prepare proposals, ahead of the next
SHAREHOLDERS Annual General Meeting, concerning the election of the Chairman
At the end of 2022, the company had 4,239 shareholders. Invest- of the Board and other Board members, the election of the Chair-
ment AB Latour was the largest shareholder with 29.98 percent man of the Meeting, remuneration issues and related issues, and,
of the shares, while Neudi kapital AB owned 10.03 percent, IF where applicable, the election of auditors.
Skadeförsäkring AB (publ) owned 9.90 percent and Swedbank
Robur Fonder owned 8.36 percent. The ten largest shareholders In accordance with the Annual General Meeting’s guidelines for
had a total holding corresponding to 78.24 percent of the shares. the work of the Nomination Committee, Anders Mörck, Invest-
Foreign investors held 8.31 percent of the shares. For further ment AB Latour, Chairman; Fredrik Ahlin, IF Skadeförsäkring AB;
information about the share and shareholders, see pages 76-77. Henrik Forsberg Schoultz, Neudi Kapital AB and Oscar Bergman,
Swedbank Robur, were appointed to the Nomination Committee
ANNUAL GENERAL MEETING ahead of the Annual General Meeting in 2023. Johan Menckel,
The General Meeting of Shareholders is the highest decision-mak- Chairman of Nederman’s Board of Directors, is a co-opted member
ing body, in which the shareholders can exercise their influence of the Nomination Committee. For questions concerning the work
by voting on key issues, such as the adoption of the income state- of the Nomination Committee, contact [email protected].
ment and balance sheet, appropriation of the company’s profit,
discharge from liability of Board members and the CEO, the elec- BOARD OF DIRECTORS
tion of Board members, the Chairman of the Board and auditors, The Board of Directors is the second highest decision-making
and remuneration to the Board of Directors and auditors. The body after the General Meeting of Shareholders. The overall
Annual General Meeting was held in Helsingborg on 25 April 2022. assignment of the Board is to decide on the company’s business
At the Meeting, 44 shareholders participated, representing 65.87 direction, its resources and capital structure as well as its organ-
percent of the total number of shares and votes in the company. isation and management. The Board’s general obligations also
include continuously evaluating the company’s financial situation
The Meeting adopted the income statement and balance sheet, and approving the company’s business plan. In its general under-
and the consolidated income statement and balance sheet, and taking, the Board addresses overall issues such as the company's
granted discharge from liability for the Board members and CEO. strategy, acquisitions, major investments, divestments, the publi-
The Board decided to distribute the profit in accordance with the cation of annual reports and interim reports, and the appointment
proposal on the allocation of profits, meaning that the dividend for of the CEO.
 DIRECTORS’ REPORT – CORPORATE GOVERNANCE   87

Overall structure of corporate governance in Nederman

Preparing Decision-making Controlling

function function function

General Meeting of
Nomination Committee Auditor
Shareholders

Remuneration Committee Board of Directors Audit Committee

CEO

The Board of Directors follows written rules of procedure that meets the requirements of the Code with respect to independent
are adopted annually at the first Board meeting following elec- members. The members are presented on page 92 and at neder-
tion. The rules of procedure stipulate how work is to be divided mangroup.com.
between Board members, how often the Board is to meet and to
what extent deputies are to participate in the work of the Board The main shareholders and Board members carry out a detailed
and attend meetings. The rules of procedure also regulate the annual evaluation of the Board. Among other things, the evalua-
Board’s obligations, the establishment of a quorum, the division tion includes the Board’s composition, individual Board members
of responsibilities between the Board and the CEO, etc. The Board and the Board’s work and procedures. The Nomination Committee
meets according to an annual schedule that is decided in advance. has reviewed the written evaluation of the work of the Board and
Extraordinary meetings may be called to address events of unusu- has received a report on the work of the Board from the Chairman
al importance. In addition to Board meetings, the Chairman of the of the Board.
Board and the CEO conduct an ongoing dialogue with respect to
the management of the company. During 2022, Nederman’s Board of Directors comprised six mem-
bers elected by the 2022 Annual General Meeting. The CEO is a
Once a year, the entire Board conducts a systematic evaluation of member of the Board. The CFO is not a member of the Board but, as
the company’s senior executives. In this context, “senior execu- a rule, participates in Board meetings by presenting information.
tives” includes certain deputy managers, meaning a broader group The Chairman of the Board does not participate in the operational
of employees. management of the company.

In recent financial years, the Board has made decisions concerning Attendance at Board meetings
several matters of strategic importance. In 2022, special focus was ■ Anna Kinberg Batra 4 of 4
devoted to adaptation of the group’s capacity, the group’s strate- ■ Gunilla Fransson 6 of 6
gy for continued expansion and the group’s financial framework ■ Ylva op den Velde Hammargren 6 of 6
and objectives. In 2022, the Board held six minuted meetings. To ■ Johan Hjertonsson 2 of 2
date, one minuted meeting has been held in 2023. The 2022 Annu- ■ Sven Kristensson 6 of 6
al General Meeting resolved that a total of SEK 1,950,000 would be ■ Johan Menckel 6 of 6
paid in directors’ fees, with SEK 750,000 paid to the Chairman of ■ Sam Strömerstén 6 of 6
the Board and SEK 300,000 to each of the other members elected
by the Annual General Meeting, with the exception of the CEO. It
was furthermore resolved that a fee of SEK 104,000 would be paid CEO
to the Chairman of the Audit Committee and SEK 68,000 to the The division of activities between the Board and the CEO is reg-
committee member, and that a fee of SEK 52,000 would be paid to ulated by the rules of procedure for the Board and in the terms of
the Chairman of the Remuneration Committee and SEK 26,000 to reference for the CEO. The CEO is responsible for implementing
the other member. the business plan as well as the day-to-day management of the
company’s affairs and the daily operations of the company. This
As stated in the Articles of Association, the General Meeting of means that the CEO makes decisions on those issues that can be
Shareholders has full decision-making power in election of Board considered to fall under the day-to-day management of the com-
members and there are no other regulations concerning appoint- pany. The CEO may also take action without the authorisation of
ment and dismissal of Board members. The Annual General Meet- the Board in matters which, considering the scope and nature of
ing elects Board members annually for the period until the next the company’s business, are unusual or of great importance, which
Annual General Meeting is held. The Board of Directors is to con- cannot await a decision by the Board without seriously compro-
sist of at least three and no more than eight ordinary members mising the company’s business activities. The terms of reference
and may be supplemented with a maximum of three deputies. In for the CEO also regulate the CEO’s responsibility for reporting to
addition, there may be employee representatives. The members the Board. The Board receives a monthly written report contain-
elected by the Annual General Meeting are all independent in rela- ing a follow-up of the company’s order statistics, sales, operating
tion to the major shareholders and, with the exception of the CEO, results, working capital developments, income statement, finan-
in relation to the company and company management. The Board cial position and cash flow statement. The report also contains
88   DIRECTORS’ REPORT – CORPORATE GOVERNANCE

comments from the CEO and CFO, for example, regarding the var- Andreas Mast has long experience in auditing listed companies and
ious markets. companies in an international environment. He is now lead auditor
for companies including Gunnebo, VBG Group, Semcon and Revo-
Every year, the senior executives formulate a strategy proposal, lutionrace. The company’s auditor audits the annual accounts and
which is discussed and adopted at the final Board meeting during financial statements and the company’s ongoing operations and
the autumn. Work on the business plan, including the budget for procedures to provide an opinion on the accounting and manage-
the coming year, is usually carried out from the bottom up and ment of the Board of Directors and the CEO. The 2022 Annual Gen-
based on the strategy. The CEO and the CFO present the business eral Meeting resolved that the auditors should be paid on a current
plan proposal to the Board of Directors. After the Board discusses account basis. Fees to Ernst & Young AB for assignments other
the business plan, it is usually adopted at the last meeting during than auditing amounted to SEK 1.3m in 2022 and pertain mainly to
the autumn. In addition, the company prepares a monthly updated auditing of the six-month report and the sustainability report, as
forecast. well as other auditing-related services.

COMMITTEES REMUNERATION TO SENIOR EXECUTIVES

Remuneration Committee: Questions about salary and benefits The 2022 Annual General Meeting adopted the Board of Directors’
for the CEO and senior executives are addressed and approved by proposal for guidelines for executive remuneration. In relation
the Remuneration Committee. This committee consists of Johan to the earlier guidelines, the proposal means that sustainability
Menckel and Gunilla Fransson. The committee is a body within the goals linked to the business were added with regard to criteria for
company’s Board assigned to draft matters for the Board related variable remuneration. Otherwise, the guidelines are unchanged.
to remuneration and other terms of employment for company Nederman’s Group management fall within the provisions of these
management. The committee is also tasked with preparing guide- guidelines. The remuneration shall be on market terms and may
lines for executive remuneration, which the Board then presents consist of the following components: fixed salary, variable remu-
as a proposal to the Annual General Meeting. The Remuneration neration, pension benefits and other benefits. Fixed salary is paid
Committee held one minuted meeting in 2022. for satisfactory work. The variable remuneration shall be linked
to predetermined, well-defined and measurable financial criteria.
The prevailing guidelines for executive remuneration were adopt- The satisfaction of criteria for awarding variable remuneration
ed by the Annual General Meeting in 2022. The guidelines are pre- shall be measured over a period of one year. The variable remuner-
sented in the section, “Remuneration to senior executives.” ation may amount to not more than 50 percent of the total fixed
salary under the measurement period for the CEO and not more
Audit Committee: The main purpose of the Audit Committee is than 30 percent of the total fixed salary under the measurement
to supervise the group’s financial accounting and reporting and period for other senior executives. The criteria for variable remu-
the audit of the annual accounts. The Audit Committee’s tasks neration shall mainly relate to the group’s profitability, working
include, among other things, responsibility for the preparation of capital development and sustainability goals that are linked to the
the Board’s work to ensure the quality of the financial reporting business. Variable remuneration may also be related to individu-
by reviewing the interim reports, annual report and consolidated al criteria. The criteria shall be designed so as to contribute to the
financial statements. The Audit Committee is also tasked with company’s business strategy and long-term interests, including
preparing matters regarding the procurement of audit services its sustainability. Further variable remuneration may be awarded
and other services from the auditor and preparing certain account- in extraordinary circumstances, provided that such extraordinary
ing and audit matters to be dealt with by the Board. The work of the arrangements are limited in time and only made on an individual
Audit Committee is governed by rules of procedure adopted by the basis, either for the purpose of recruiting or retaining executives,
Board of Directors. The Committee convened on five occasions in or as remuneration for extraordinary performance beyond the
2022 and has held one minuted meeting to date in 2023. The com- individual’s ordinary tasks. Such remuneration may not exceed an
pany’s auditor participated on these occasions. On February 13, amount corresponding to 50 percent of the fixed annual salary and
2023 the company’s auditor informed the Board of the results of may not be paid more than once each year per individual.
its work and presented a report on the year’s audit and its view of
the company’s internal control system without the presence of any For the CEO, pension benefits shall be premium-based. The pen-
members of company management. In 2022, the Audit Committee sion premiums for premium-based pension shall amount to not
consisted of Board members Ylva op den Velde Hammargren and more than 35 percent of the pension based salary. For other exec-
Sam Strömerstén. utives, pension benefits shall be based on a contractual ITP plan
or be premium-based, unless the individual concerned is subject to
AUDITOR defined-benefit pension under mandatory collective agreement
The auditor audits the company’s annual report and account- provisions. Variable cash remuneration shall qualify for pension
ing as well as the management of the Board of Directors and the benefits. Pension premiums that follow from the contractual ITP
CEO. The auditor submits an audit report to the General Meeting plan or are premium-based, shall amount to not more than 35
of Shareholders after each financial year. From 2011, the Annual percent of the pension based salary, unless other premium levels
General Meeting appoints an auditor for a period of one year. At apply according to applicable ITP plan.
the Annual General Meeting on 25 April 2022, it was resolved in
accordance with the Nomination Committee’s proposal to re-elect Other benefits may include, for example, life insurance, health and
the registered auditing firm Ernst & Young AB until the close of the medical insurance and company cars. Such benefits may amount
2023 Annual General Meeting, with Andreas Mast as lead auditor. to not more than 20 percent of the fixed annual salary.
Andreas Mast is an Authorised Public Accountant and member
of FAR, the Swedish Institute of Authorised Public Accountants.
 DIRECTORS’ REPORT – CORPORATE GOVERNANCE   89

The notice period may not exceed 24 months if notice of termi- nicated in electronic or printed format. For communications with
nation of employment is made by the company for the CEO and external parties, there is a communication policy that contains
twelve months for other executives. Fixed salary during the guidelines for ensuring that the company’s information obliga-
period of notice and severance pay may together not exceed an tions are applied fully and correctly.
amount equivalent to the CEO’s fixed salary for two years, and one
year for other executives. When termination is made by the exec- Sustainability. Each board meeting has a fixed agenda point at
utive, the notice period may not exceed six months, without any which the company’s CEO reports on social, environmental and
right to severance pay. economic movements within “The clean Air journey”. Nederman’s
business strategy process contains a clear focus on sustainabili-
The Annual General Meeting held on 26 April 2021 approved the ty, which is presented by group management and anchored with
Board’s proposal that the annual programmes for variable remu- the company’s board. The Nederman Group sustainability related
neration should be supplemented with a long-term incentive (LTI) KPIs and actions are presented by each division manager at every
programme. The LTI programme comprised the two financial years third monthly meeting for group management. The process
2021 and 2022 and is targeted in a way that makes it particularly means that the sustainability work is constantly improved and
favourable for the company’s shareholders. The outcome of the reflected upon, which enables a good spread of efforts within the
LTI programme for senior executives of the Nederman group could Nederman group.
amount to a maximum of 35 percent of annual salary for the CEO
and 14-20 percent of annual salary for other senior executives. At least one annual board meeting is held at one of Nederman’s
An outcome required that a minimum level of accumulated earn- development units and/or at the company’s key customers, with
ings per share established for the 2021 and 2022 financial years the aim of informing and discussing environmental, social and eco-
be achieved or exceeded. The remuneration for the senior execu- nomic progress for “The clean air company”. Nederman’s business
tive according to the terms and conditions (net after tax) was to be strategy process 2022 included in-depth work in group manage-
invested in Nederman shares. The shareholding must be retained ment regarding sustainability. The process managers conducted
by the senior executive for a minimum of three years. Investment workshops for the division managers, who were then tasked with
in shares could be made via the stock exchange or through the working through the sustainability issue in each division in order to
transfer of treasury shares. The outcome for the LTI programme report anchored decisions regarding focused sustainability work.
2021-2022 amounted to SEK 5.5m.
The board and the company management team have, for the past
INTERNAL CONTROL two years, invited stakeholders and industry colleagues to The
Control environment. Operational decisions are made at the Clean Air Day. The day aims at sharing and discussing successes
company or business area level, while decisions about strategy, and challenges linked to the company’s Clean air journey. In 2022,
aims, acquisitions and comprehensive financial issues are made this was carried out in September. In addition, Nederman’s larg-
by the parent company's Board and Group management. The est shareholder convenes an annual sustainability conference, in
internal controls within the group are designed to function in this which their wholly and partially owned companies participate. The
organisation. The group has clear rules and regulations for dele- sustainability conference aims to support and drive the sustain-
gating responsibility and authority in accordance with the group’s ability work in these companies and collaborate for the greatest
structure. The platform for internal controls of financial reporting possible positive movement. The 2022 sustainability conference
consists of the comprehensive control environment and organisa- was attended by Nederman’s CEO, CFO, Marketing manager and
tion, decision processes, authorisations and responsibilities which the newly recruited Group Sustainability Manager. Nederman’s
have been documented and communicated. In the group, the most largest shareholder also organises monthly digital meetings, in
significant components are documented in the form of instruc- which the companies’ sustainability managers collaborate.
tions and policies in finance, ethics (Code of Conduct), communica-
tion, IT security, integrity, sustainability and quality, whistleblow- Follow-up. The CEO is responsible for ensuring that the internal
ing, export and sanctions, anti-corruption and fraud, anti-trust, controls are organised and followed up according to the guidelines
diversity, health and safety, logistics, risk management, remu- decided on by the Board. Financial management and control is
neration and authorisation instructions. Nederman has a simple carried out by the group’s finance function. Financial reporting is
legal and operational structure and established management and analysed monthly at a detailed level. The Board has addressed the
internal control systems. The Board of Directors follows up on the company’s financial position at its meetings and has also received
assessment of the internal control, including through manage- reports and observations from the company’s auditor.
ment reporting to the Audit Committee and through contacts with
the Nederman’s auditors. The Board of Directors has chosen not to ARTICLES OF ASSOCIATION
have a special internal audit. The Articles of Association stipulate the company’s activities, the
number of Board members and auditors, how notification of the
Control activities. To safeguard the internal controls, there are Annual General Meeting is to be made, the matters to be addressed
both automated controls, such as authorisation controls in the IT at the Annual General Meeting and where the Meeting is to be held.
system and approval controls, as well as manual controls such as The General Meeting of Shareholders has full decision-making
reconciliations and stock-taking. Financial analyses of the results power concerning amendments in the Articles of Association. The
as well as follow-up of plans and forecasts are used to supplement current Articles of Association were adopted at the Annual Gen-
the controls and give a comprehensive confirmation of the quality eral Meeting on 27 April 2020, and can be found on the company’s
of the reporting. website at www.nedermangroup.com and in the annual report for
2022 on page 149.
Information and communication. Documentation of governing
policies and instructions are continuously updated and commu-
90   DIRECTORS’ REPORT – GUIDELINES FOR EXECUTIVE REMUNERATION

Proposal for guidelines for

remuneration to executives
The Board of Directors of Nederman Holding AB (“Nederman” or tion may amount to not more than 50 percent of the total fixed sal-
the “company”) proposes that the Annual General Meeting 2023 ary under the performance period for the CEO and for other senior
resolves on the following guidelines for executive remuneration. executives. The criteria for STI shall mainly relate to the group’s
In relation to the current guidelines, the proposal entails that the profitability, working capital development and sustainability goals
company has added a long-term variable remuneration for senior that are linked to the business. In addition, individual criteria may
executives in accordance with the section “Long-term variable be established. The criteria shall be designed so as to contribute to
remuneration” below. the company’s business strategy and long-term interests, includ-
ing its sustainability and since Nederman’s business strategy is
These guidelines apply to the executives constituting group to be “the Clean Air Company” by protecting people, planet and
management. The guidelines are forward-looking and as such are production from the harmful effects of industrial processes, the
applicable to remuneration agreed, and amendments to remu- criteria for STI, which are connected to the sale of the company’s
neration already agreed, after adoption of the guidelines by the solutions and services within industrial air filtration, will inevitably
Annual General Meeting 2023. These guidelines do not apply to contribute to the company’s long-term interest and sustainability.
any remuneration decided or approved by the General Meeting
separately. Long-term variable remuneration (“LTI”)
The STI shall be supplemented by a long-term incentive connected
PROMOTION OF BUSINESS STRATEGY, to the development of the share price. By connecting the LTI to the
LONG-TERM INTERESTS AND SUSTAINABILITY share price development, a common interest is created with the
In short, Nederman’s business strategy is to be “the Clean Air Com- shareholders that aims to promote the company’s business strat-
pany”, and to use Nederman’s industrial air filtration expertise and egy, long-term interests and value creation.
solutions and services to protect people, planet and production
from the harmful effects of industrial processes. In this way, Ned- During year 1, the initial grant value of the LTI shall correspond to
erman helps to create safer workplaces, efficient production and the STI earned during the previous year (the “Initial Grant Value”).
provide significant environmental benefits. A prerequisite for the The Initial Grant Value shall then be vested over a period of three
successful implementation of the company’s business strategy years and indexed to reflect the share price development of the
and safeguarding of its long-term interests, including its sustain- company’s share. In year 2, the Initial Grant Value shall be indexed
ability, is that the company is able to recruit and retain qualified to reflect the share price development between the publication of
personnel. The objective of Nederman’s guidelines for executive the year-end report in year 1 and in year 2, following which 1/3 of
remuneration is therefore to offer competitive remuneration on the so indexed amount shall be paid to the executive. In year 3, the
market terms, so that competent and skillful personnel can be remaining (indexed) amount, shall again be indexed to reflect the
attracted, motivated and retained. These guidelines enable the share price development between the publication of the year-end
company to offer the executive management competitive total report in year 2 and in year 3, following which ½ of said indexed
remuneration. For more information regarding the company’s amount shall be paid to the executive. In year 4, the remaining
business strategy, please see www.nedermangroup.com. (indexed) amount, shall again be indexed to reflect the share price
development between the publication of the year-end report in
TYPES OF REMUNERATION, ETC. year 3 and in year 4, following which such indexed amount shall be
The remuneration shall be on market terms and may consist of the paid to the executive. The share price index shall correspond to the
following components: fixed salary, variable cash remuneration, increase or the decrease in the share price measured as the vol-
pension benefits and other benefits. Additionally, the General ume-weighted average of the price paid for the company’s share
Meeting may from time to time and outside the scope of these at Nasdaq Stockholm during ten trading days immediately after
guidelines, resolve on other equity based remuneration. The the publication of a year-end report.
Remuneration Committee shall monitor and evaluate remunera-
tion for the executive management however all remuneration for The LTI payout, shall be subject to an undertaking by the executive
the CEO is approved by the Board of Directors. to invest the LTI payout in Nederman shares without undue delay
and to retain such shares for not less than three years.
Fixed salary
Fixed salary is paid for satisfactory work. The STI plus the LTI paid out to an executive each year, may in
aggregate not amount to more than 150 percent of the total fixed
Variable cash remuneration salary for the CEO and not more than 100 percent of the total fixed
Annual variable remuneration (“STI”) salary for other senior executives.
The short term incentive shall be linked to predetermined, well-de-
fined and measurable financial criteria. The satisfaction of criteria The costs associated with the variable remuneration are regular
for awarding variable remuneration shall be measured over a peri- personnel costs associated with cash compensation.
od of one financial year (performance period). The STI remunera-
 DIRECTORS’ REPORT – GUIDELINES FOR EXECUTIVE REMUNERATION   91

Other variable remuneration and twelve months for other executives. Fixed salary during the
Further variable remuneration may be awarded in extraordinary period of notice and severance pay may together not exceed an
circumstances, provided that such extraordinary arrangements amount equivalent to the CEO’s fixed salary for two years, and one
are limited in time and only made on an individual basis, either for year for other executives. When termination is made by the exec-
the purpose of recruiting or retaining executives, or as remuner- utive, the notice period may not exceed six months, without any
ation for extraordinary performance beyond the individual’s ordi- right to severance pay.
nary tasks. Remuneration for extraordinary circumstances is not
measurable, but the possibility for the Board of Directors to decide SALARY AND EMPLOYMENT
on such remuneration is considered important by the Board of CONDITIONS FOR EMPLOYEES
Directors for the purpose of recruiting or retaining executives, or In the preparation of the Board of Directors’ proposal for these
as remuneration for extraordinary work. Such remuneration may remuneration guidelines, salary and employment conditions
not exceed an amount corresponding to 50 percent of the fixed for employees of the company have been taken into account by
annual salary and may not be paid more than once each year per including information on the employees’ total income, the com-
individual. Any resolution on such remuneration shall be made by ponents of the remuneration and increase and growth rate over
the Board of Directors based on a proposal from the Remuneration time, in the Remuneration Committee’s and the Board of Directors’
Committee. basis of decision when evaluating whether the guidelines and the
limitations set out herein are reasonable.
Pension benefits
For the CEO, pension benefits shall be premium defined. The pen- THE DECISION-MAKING PROCESS TO DETERMINE,
sion premiums for premium defined pension shall amount to not REVIEW AND IMPLEMENT THE GUIDELINES
more than 35 percent of the pension based salary. For other exec- The Board of Directors has previously established a Remuneration
utives, pension benefits shall be based on a contractual ITP plan Committee. The committee’s tasks include preparing the Board
or be premium defined, unless the individual concerned is subject of Directors’ decision to propose guidelines for executive remu-
to defined benefit pension under mandatory collective agreement neration. The Board of Directors shall prepare a proposal for new
provisions. Variable cash remuneration shall qualify for pension guidelines at least every fourth year and submit it to the General
benefits. Pension premiums that follow from the contractual ITP Meeting. The guidelines shall be in force until new guidelines are
plan or are premium defined, shall amount to not more than 35 adopted by the General Meeting. The Remuneration Committee
percent of the pension based salary, unless other premium levels shall also monitor and evaluate programs for variable remunera-
apply according to applicable ITP plan. tion for the executive management, the application of the guide-
lines for executive remuneration as well as the current remuner-
For employment governed by rules other than Swedish, pension ation structures and compensation levels in the company. The
benefits and other benefits may be duly adjusted for compliance members of the Remuneration Committee are independent of the
with mandatory rules or established local practice, taking into company and its executive management. The CEO and other mem-
account, to the extent possible, the overall purpose of these bers of the executive management do not participate in the Board
guidelines. of Directors’ processing of and resolutions regarding remunera-
tion-related matters in so far as they are affected by such matters.
Other benefits
Other benefits may include, for example, life insurance, health and DEROGATION FROM THE GUIDELINES
medical insurance and company cars. Such benefits may amount The Board of Directors may temporarily resolve to derogate from
to not more than 20 percent of the fixed annual salary. the guidelines, in whole or in part, if in a specific case there is spe-
cial cause for the derogation and a derogation is necessary to
CRITERIA FOR AWARDING serve the company’s long-term interests, including its sustainabil-
VARIABLE REMUNERATION, ETC. ity, or to ensure the company’s financial viability. As set out above,
The Remuneration Committee shall monitor and evaluate pro- the Remuneration Committee’s tasks include preparing the Board
grams for variable remuneration for the executive management. of Directors’ resolutions in remuneration-related matters. This
To which extent the criteria for awarding variable remuneration includes any resolutions to derogate from the guidelines.
has been satisfied shall be evaluated when the performance peri-
od has ended. The Remuneration Committee is responsible for the DESCRIPTION OF MATERIAL CHANGES OF
evaluation so far as it concerns variable remuneration to the CEO. THE GUIDELINES AND SHAREHOLDER’S VIEWS
For variable remuneration to other executives, the CEO is respon- In relation to the current guidelines resolved by the Annual Gen-
sible for the evaluation. For financial criteria, the evaluation shall eral Meeting 2022, the proposal for the Annual General Meeting
be based on the latest financial information made public by the 2023 entails that the company has added a long-term variable
company. Variable cash remuneration can be paid after the com- remuneration for senior executives in accordance with the sec-
pletion of a performance period or be subject to deferred payment. tion “Long-term variable remuneration” above.
The Board of Directors shall have the possibility, under applicable
law or contractual provisions, to in whole or in part reclaim variable The Board of Directors has not received any views from the share-
remuneration paid on incorrect grounds (claw-back). holders on the guidelines for executive remuneration.

TERMINATION OF EMPLOYMENT
The notice period may not exceed twenty four months if notice of
termination of employment is made by the company for the CEO
92   DIRECTORS’ REPORT - BOARD OF DIRECTORS

Board of Directors

JOHAN MENCKEL (1971) GUNILLA FRANSSON (1960) YLVA OP DEN VELDE HAMMARGREN (1966)
Chairman of the Board since 2022. Elected 2016. Elected by the Annual General Meeting. Elected by the Annual General Meeting.
Chairman of the Remuneration Committee. Elected 2016. Elected 2011.
Member of the Remuneration Committee. Chairman of the Audit Committee.

Education: M.Sc. Eng. Industrial Economy, Education: M.Sc. Eng. and Licentiate of Education: M.Sc. Eng. Mining Engineering
Kungliga Tekniska Högskolan (KTH) Technology, KTH Royal Institute of Technology Swedish citizen
Swedish citizen Swedish citizen Current activities: Business Line Manager
Current activities: CIO Investment AB Latour. Current activities: Chairman of NetInsight AB. Powertrain and Two-wheeler, Vehicle
Chairman of Bemsiq AB and Nord-Lock Board member of Eltel AB, Trelleborg AB, Weibel Aftermarket at AB SKF.
International AB. Board member of Saab AB and Scientific A/S, Securitas AB and Previous key roles: Board member
Securitas. Member of the Steering Committee of Dunkerintressena. of Södra.
the World Materials Forum. Previous key roles: Various management Shareholding: -
Previous key roles: positions within Saab AB and Ericsson AB. Dependency: Independent
President and CEO of Gränges AB. Board member Shareholding: 800 shares
of the Swedish Chamber of Commerce in China. Dependency: Independent
CEO of Sapa Heat Transfer and Sapa Heat Transfer
Shanghai. Management consultant at Accenture
and founder of addnature.com.
Shareholding: 4,000 shares
Dependency: Dependent in relation to the
company’s major shareholders

SVEN KRISTENSSON (1962) SAM STRÖMERSTÉN (1955)

Elected by the Annual General Meeting. Elected by the Annual General Meeting.
Elected 2008. Elected 2019.
Member of the Audit Committee.

Education: The Swedish Air Force. University of Education: M.Sc. Eng. Mechanical Engineering
Linköping. LTH80
Swedish citizen Swedish citizen
Current activities: President and CEO of Current activities: President Association of the
Nederman Holding AB. Chairman of the Board of Beverage Machinery Industry.
BK Pac AB, Diedenporten AB and Kristensson Previous key roles: CEO & President Sidel, EVP
Holding AB. Vice Chairman of the Board of Dr P Supply Chain, Tetra Pak, EVP Processing Systems,
Håkonssons stiftelser. Tetra Pak.
Board member of Novotek AB and Swegon AB. Shareholding: 500 shares
Previous key roles: Various positions in medical Dependency: Independent
technology (Group management of Getinge AB),
and packaging (Group management of AB
Åkerlund & Rausing), among others.
Shareholding: 332,158 shares
Dependency: Dependent in relation to the
company.
 DIRECTORS’ REPORT – GROUP MANAGEMENT   93

Group management

SVEN KRISTENSSON (1962) MATTHEW CUSICK (1977) HANS DAHLÉN (1968) TOMAS HAGSTRÖM (1976)
President and CEO SVP, CFO SVP, Head of Division SVP, Head of Division
Extraction & Filtration Technology Process Technology

Employed 2001 Employed 2011 Employed 2013 Employed 2017

Swedish citizen Swedish/UK citizen Swedish citizen Swedish/US citizen
Education: The Swedish Air Force. Education: B.A. Accounting & Education: M.Sc. Chemical Engineering Education: M.Sc. Electrical
University of Linköping. Finance Current activities: No other activities Engineering, B.Sc. Business
Current activities: Chairman of the Current activities: No other Shareholding: 4,860 shares Administration, MBA
Board of BK Pac AB, Diedenporten AB activities Current activities: No other
and Kristensson Holding AB. Shareholding: 1,506 shares activities
Vice Chairman of the Board of Dr P Shareholding: 540 shares
Håkonssons stiftelser.
Board member of Novotek AB and
Swegon AB.
Shareholding: 332,158 shares

KETIL GORM PAULSEN (1961) THOMAS NIKLASSON (1970) JEPPE RASMUSSEN (1962) JOAKIM RYRSTEDT (1974)
SVP, Head of Division SVP, Marketing & Communications SVP, Head of Division SVP, CIO
Monitoring & Control Technology Duct & Filter Technology

Employed 2017 Employed 2014 Employed 2019 Employed 2021

Norwegian citizen Swedish citizen Danish citizen Swedish citizen
Education: M.Sc. Physics/Civil Education: M.Sc. Business & Education: M.Sc. Ph.D. Marine Education: M.Sc. Business
Engineer, Master of Management Economics Engineering Administration
Current activities: No other activities. Current activities: No other activities Current activities: Current activities: No other activities.
Shareholding: – Shareholding: 1,000 shares Board member of New Nordic Shareholding: 125 shares
Engineering A/S
Shareholding: –

EVA CARIN SVENSSON (1964) ERIK WAHN (1980)

SVP, Human Resources SVP, Corporate Strategy &
Business Development

Employed 2009 Employed 2019

Swedish citizen Swedish citizen
Education: B.Sc. in Human Resources Education: M.Sc. Business &
Management & Labour Relations Economics
Current activities: No other activities. Current activities: Chairman of the
Shareholding: 4,975 shares Board of pej AB. Board member of
Polynom Investment AB.
Shareholding: –
94   CONSOLIDATED FINANCIAL STATEMENTS

Consolidated statement of profit or loss

1 January - 31 December
SEKm Note 2022 2021
Net sales 5, 6 5,178.9 4,041.8
Cost of goods sold 9 -3,311.0 -2,518.5
Gross profit 1,867.9 1,523.3

Selling expenses 9 -877.8 -702.1

Administrative expenses 4, 9 -429.9 -336.4
Research and developement expenses 9 -72.5 -57.0
Other operating income and expenses 7 -7.5 31.1
Operating profit 5, 8, 10, 13, 14, 15, 24, 27 480.2 458.9

Financial income 28 23.0 3.4

Financial expenses -64.4 -45.2
Net financial items 11 -41.4 -41.8

Profit before tax 438.8 417.1

Taxes 12 -110.1 -111.8
Net profit for the year 328.7 305.3

Net profit attributable to

Parent company’s shareholders 328.7 305.3

Earnings per share 20 9.37 8.70

Consolidated statement of other comprehensive income

1 January - 31 December
SEKm Note 2022 2021
Net profit for the year 328.7 305.3
Other comprehensive income
Items that cannot be reclassified to the income statement
Revaluation of defined-benefit pension plans 24 35.3 19.0
Tax attributable to revaluation of defined-benefit pension plans -8.0 -3.8
27.3 15.2
Items that have been or can be reclassified to net profit
Exchange differences arising on translation of foreign operations 235.9 131.2
235.9 131.2
Other comprehensive income for the year, net after tax 263.2 146.4
Total comprehensive income for the year 591.9 451.7

Total comprehensive income attributable to

Parent company’s shareholders 591.9 451.7
 CONSOLIDATED FINANCIAL STATEMENTS   95

Consolidated statement of financial position

31 December
SEKm Note 2022 2021
Assets
Intangible fixed assets 13 2,674.3 2,062.4
Tangible fixed assets 14 390.1 316.8
Right-of-use assets 15 186.2 192.3
Long-term receivables 18 4.2 5.6
Deferred tax assets 12 104.0 68.5
Total fixed assets 3,358.8 2,645.6

Inventory 16 890.8 613.1

Current tax assets 12 65.4 51.1
Accounts receivable 17, 26 814.8 623.0
Contract assets 6, 26 165.3 126.8
Other receivables 18, 26 110.7 82.4
Prepaid expenses and accrued income 19 93.1 45.4
Cash and cash equivalents 26, 31 721.2 541.6
Total current assets 2,861.3 2,083.4
Total assets 5 6,220.1 4,729.0

Equity 20

Share capital 1.2 1.2

Other capital contributed 345.9 345.9
Reserves 313.2 77.3
Retained earnings including net profit 1,526.2 1,293.0
Equity attributable to the parent company’s shareholders 2,186.5 1,717.4
Total equity 2,186.5 1,717.4

Liabilities
Long-term interest-bearing liabilities 3, 21, 26 1,931.9 1,304.6
Long-term lease liabilities 3, 21, 26 122.0 133.1
Other long-term liabilities 22, 26 28.0 23.6
Pension provisions 24 70.5 102.2
Other provisions 25 28.3 19.2
Deferred tax liabilities 12 119.0 71.5
Total long-term liabilities 2,299.7 1,654.2

Current lease liabilities 3, 21, 26 73.9 69.5

Accounts payable 3, 26 498.2 411.9
Contract liabilities 6, 26 615.3 404.2
Current tax liabilities 12 97.4 94.7
Other liabilities 22, 26 137.5 115.2
Accrued expenses and prepaid income 23, 26 268.5 220.9
Provisions 25 43.1 41.0
Total current liabilities 1,733.9 1,357.4
Total liabilities 5 4,033.6 3,011.6
Total equity and liabilities 6,220.1 4,729.0
96   CONSOLIDATED FINANCIAL STATEMENTS

Consolidated statement of changes in equity

Equity attributable to the parent company’s shareholders
Retained
Other earnings
Share contributed Translation including this Total
SEKm capital capital reserve year’s profit equity
Opening equity 2021-01-01 1.2 345.9 -53.9 1,007.6 1,300.8
Net profit for the year – – – 305.3 305.3
Other comprehensive income
Change in translation reserve for the year – – 131.2 – 131.2
Revaluation of defined- benefit pension plans, net after tax – – – 15.2 15.2
Total other comprehensive income – – 131.2 15.2 146.4
Total comprehensive income for the year – – 131.2 320.5 451.7
Transactions with group’s owners
Dividend paid – – – -35.1 -35.1
Utgående eget kapital 2021-12-31 1.2 345.9 77.3 1,293.0 1,717.4

Opening equity 2022-01-01 1.2 345.9 77.3 1,293.0 1,717.4

Net profit for the year – – – 328.7 328.7
Other comprehensive income
Change in translation reserve for the year – – 235.9 – 235.9
Revaluation of defined- benefit pension plans, net after tax – – – 27.3 27.3
Total other comprehensive income – – 235.9 27.3 263.2
Total comprehensive income for the year – – 235.9 356.0 591.9
Transactions with Group’s owners
Dividend paid – – – -122.8 -122.8
Closing equity 2022-12-31 1.2 345.9 313.2 1,526.2 2,186.5
 CONSOLIDATED FINANCIAL STATEMENTS   97

Consolidated statement of cash flows

1 January - 31 December
SEKm Note 2022 2021
Operating activities
Operating profit 480.2 458.9
Adjustment for:
Depreciation and amortisation of fixed assets 201.8 174.3
Other adjustments for non cash items 31 0.7 -42.6
Interest received 11.1 2.1
Interest paid -64.2 -42.2
Income tax paid -134.9 -76.1
Cash flow from operating activities before changes in working capital 494.7 474.4

Increase (-)/Decrease (+) in inventories -186.5 -92.8

Increase (-)/Decrease (+) in operating receivables -114.0 -86.1
Increase (-)/Decrease (+) in operating liabilities 151.5 224.3
Cash flow from changes in working capital -149.0 45.4
Cash flow from operating activities 345.7 519.8

Investing activities
Capital expenditure on tangible fixed assets -70.7 -39.2
Sales of tangible fixed assets 0.6 1.7
Capital expenditure on capitalised development costs -53.9 -41.0
Capital expenditure on other intangible fixed assets -46.2 -28.8
Acquisition of subsidies/business, net of cash 4 -445.3 -13.8
Changes in financial assets 0.2 0.2
Cash flow from investing activities -615.3 -120.9

Financial activities
New loans 1,945.9 120.0
Amortisation of loans -1,340.3 -367.7
Amortisation of lease liabilities -80.1 -74.0
Dividend paid to parent company shareholders -122.8 -35.1
Cash flow from financing activities 402.7 -356.8

Cash flow for the year 133.1 42.1

Cash and cash equivalents at the beginning of the year 541.6 466.8
Translation differences 46.5 32.7
Cash and cash equivalents at the end of the year 31 721.2 541.6
98   CONSOLIDATED FINANCIAL STATEMENTS

Notes to the
financial statements

Notes to the Financial statements

Note Nederman group Page Note Parent company Page

1 Accounting policies 99 1 Accounting policies 134
2 Important estimations and assessments 100 2 Revenue 134
3 Goal and policy regarding financial risk 100 3 Other operating revenue and expenses 134
4 Acquisitions of business operations 102 4 Employees 134
5 Segment reporting 103 5 Pensions 134
6 Revenue from customer contracts 105 6 Leasing 134
7 Other operating revenue and expenses 106 7 Fees and expenses to auditors 135
8 Employees 107 8 Net financial items 135
9 Expenses by nature 109 9 Appropriations 135
10 Fees and expenses to auditors 110 10 Income tax 135
11 Financial income and expenses 110 11 Intangible fixed assets 136
12 Income tax 111 12 Tangible fixed assets 137
13 Intangible fixed assets 113 13 Shares and participations 138
14 Tangible fixed assets 115 14 Other receivables 140
15 Leasing 117 15 Prepaid expenses and accrued income 140
16 Inventory 119 16 Other liabilities 140
17 Accounts receivable 119 17 Accrued expenses and prepaid income 140
18 Other receivables 120 18 Pledged assets and contingent liabilities 140
19 Prepaid expenses and accrued income 120 19 Related party transactions 140
20 Equity and number of shares 120 20 Cash flow 141
21 Interest-bearing liabilities 121 21 Appropriation of profit or loss 141
22 Other liabilities 122 22 Events after the end of the reporting period 141
23 Accrued expenses and prepaid income 122
24 Provisions for pensions and similar obligations 123
25 Other provisions 125
26 Financial instruments 126
27 Government grants 127
28 Financial reporting in hyperinflationary economies 127
29 Pledged assets and contingent liabilities 127
30 Related party transactions 128
31 Cash flow 128
32 Alternative performance measures 129
33 Events after the end of the reporting period 129
 CONSOLIDATED FINANCIAL STATEMENTS   99

1 Accounting policies

Compliance with laws and standards Restatement to Swedish krona upon

The consolidated financial statements for Nederman Holding AB and its sub- consolidation of other functional currencies
sidiaries were prepared in accordance with International Financial Reporting The parent company’s functional currency is the Swedish krona which is also
Standards (IFRS) issued by the International Accounting Standards Board the reporting currency of the parent company and the group. This means that
(IASB) as adopted by the European Union (EU). The annual report was prepared the financial statements are presented in Swedish kronor. Unless otherwise
in accordance with IAS 1, Presentation of financial statements, and in accor- stated, all amounts are rounded to the nearest million.
dance with the Swedish Annual Accounts Act. In addition, RFR 1 Supplemen-
tary Accounting Rules for groups, issued by the Swedish Financial Reporting Each group company’s functional currency is determined based on the primary
Board, has been applied. financial environment in which it conducts its operations. The primary finan-
cial environment is usually that in which the company primarily generates and
Nederman group’s accounting policies utilises cash and cash equivalents. In most cases, the functional currency is the
Nederman group describes its accounting policies in conjunction with each currency in which the company is located.
note to provide increased understanding of each reporting area. The table
below contains reference to the note in which each respective accounting poli- Assets and liabilities of foreign entities, including goodwill and other consoli-
cy can be found that is considered to have a material impact. dated surplus values and deficits, are translated from the foreign entity’s func-
tional currency to the group's reporting currency at the exchange rate prevail-
Accounting policies Note ing on the balance sheet date. Revenue and expenses of foreign entities are
Business acquisitions and 4 Acquisitions of business operations translated to Swedish kronor at an average exchange rate. Translation differ-
divestments
ences arising from currency translation of foreign subsidiaries are recognised
Operating segment 5 Segment reporting in a separate component in other comprehensive income and accumulated in
Revenue 6 Revenue from customer contracts equity designated as the translation reserve. On disposal, the hereto attribut-
Employee benefits 8 Employees able accumulated translation differences, previously recognised in the consoli-
Incentive programme 8 Employees dated statement of total comprehensive income, are realised in the consolidat-
Financial income and expenses 11 Financial income and expenses ed income statement in the same period as the profit or loss on the sale.
Income tax 12 Income tax
Research and development 13 Intangible fixed assets For foreign operations with a functional currency that is classified as a hyper-
Customer relations 13 Intangible fixed assets inflationary currency, the financial statements are adjusted to take account of
Trademarks 13 Intangible fixed assets inflation. This means that assets and liabilities, including goodwill and other
Goodwill 13 Intangible fixed assets consolidated surplus values and deficits, are adjusted for inflation in order to
Tangible fixed assets 14 Tangible fixed assets reflect changes in purchasing power. Monetary net income is recognised in net
Leasing 15 Leasing financial items.
Inventory 16 Inventory
Earnings per share 20 Equity and number of shares Transactions and balance sheet items in foreign currency
Dividend 20 Equity and number of shares Transactions in currencies other than the functional currency for the report-
Pensions and similar obligations 24 Provisions for pensions and ing company are restated to the functional currency at the exchange rate that
similar obligations applies on the transaction date. Assets and liabilities in other currencies are
Restructuring costs 25 Other provisions restated to the functional currency using the rate on the balance sheet date.
Warranty commitments 25 Other provisions Translation differences attributable to operating receivables and liabilities are
29 Pledged assets and contingent recognised as other operating income and other operating expenses, respec-
liabilities tively, in operating profit/loss, while gains and losses on financial assets and
Government grants 27 Government grants liabilities are recognised in net financial items.
Contingent liabilities 29 Pledged assets and
contingent liabilities Classifications
Cash flow statement 31 Cash flow Fixed assets and non-current liabilities essentially consist of amounts expect-
Financial instruments 3 Goal and policy regarding ed to be recovered or settled after more than 12 months calculated from the
financial risk balance sheet date. Current assets and current liabilities consist essentially of
17 Accounts receivable amounts expected to be recovered or settled within 12 months calculated from
18 Other receivables the balance sheet date and amounts where the group has an unconditional
21 Interest-bearing liabilities right to defer settlement of the liability for at least 12 months after the end of
22 Other liabilities the reporting period.
26 Financial instruments
New accounting policies in 2022 and later
Consolidation principles New and amended standards and interpretations applied to the financial year
The consolidated financial statements comprise the parent company, Neder- beginning 1 January 2022 or later had no material impact on the consolidated
man Holding AB, with its subsidiaries. Inter-company receivables and liabilities, financial statements. No new or amended IFRS has been applied in advance.
revenue and expenses, and unrealised gains and losses arising from inter-com-
pany transactions between group companies are eliminated in their entirety New accounting policies in 2023 and later
when preparing the consolidated financial statements. New and amended IFRS that have not yet come into force and have not been
applied in advance in the preparation of the group’s financial statements. None
of these has any material impact on the group’s financial statements.
100   CONSOLIDATED FINANCIAL STATEMENTS

2 Important estimations and assessments

Preparation of Nederman Holding AB’s consolidated financial statements the change is made and future periods if the change affects both current and
requires that a number of estimates and assumptions are made regarding future periods. In accordance with IAS 1, the company must provide disclosure
the future, which could affect the recognised values of assets and liabilities on the assumptions and other major sources of estimation uncertainty which,
at the time of the financial statements and revenues and expenses for the if the actual outcome does not correspond, could have material impact on the
periods presented. In preparing the financial statements, the management financial statements.
made its best estimates of certain amounts that are included in the financial
statements in respect of their materiality. Actual results may differ from earlier The sources of uncertainty in estimates and critical assessments identified by
estimates. Estimates and assumptions are reviewed on a regular basis. Chang- Nederman group, and that can be regarded as meeting these criteria, are pre-
es in estimates and assessments are recognised in the period in which the sented in connection with the items that they are deemed to affect. The table
change is made if the change affects only that period, or in the period in which shows where these descriptions appear.

Sources of estimation uncertainty and critical judgements Note

Conditional earn-out payments 4 Acquisitions of business operations
Revenue recognition relating to sales of solutions (project sales) 6 Revenue from customer contracts
Deferred tax and uncertainty in income tax processes 12 Income tax
Examination for impairment of goodwill and other intangible fixed assets 13 Intangible fixed assets
Measurement of leasing 15 Leasing
Net realisable value of inventory 16 Inventory
Provision for expected credit losses 17 Accounts receivable
Assumptions in calculation of pensions and similar obligations 24 Provisions for pensions and similar obligations
Provisions for product guarantees 25 Other provisions

3 Goal and policy regarding financial risk

Nederman is exposed to a number of risks that could significantly impact the The group’s financial liabilities, excluding pension provisions, at year-end
group’s operations, earnings and financial position, in the form of liquidity risk, totalled SEK 2,127.8m, of which SEK 1,931.9m in bank loans and SEK 195.9m in
interest risk, credit risk and currency risk. Nederman conducts continuous risk lease liabilities. The overdraft facilities were not utilised.
assessments that include identifying the risks that impact the group and taking
measures to manage these risks. It is the Board of Directors that determines The group had SEK 721.2m in cash and cash equivalents and SEK 108.4m in
the policies for risk management. The Nederman group has a central finance unutilised overdraft facilities. In addition, there was a further credit facility of
function which is responsible for identifying and effectively limiting the group’s SEK 562.1m within the framework of Nederman’s loan agreement with SEB
financial risks. The finance function reports via the CFO to the Board of Direc- and SHB. Accordingly, there were available funds totalling SEK 1,391.7m on
tors. 31 December 2022. The liquidity in the group is not exposed to large seasonal
fluctuations.
Liquidity risks
Liquidity risks pertain to the risk that Nederman group may be unable to finance According to the group’s financial policy, cash and cash equivalents are depos-
or refinance its assets or meet its payment obligations. ited only in reputable banks (“first-class banks”).

The group has a financing agreement with Skandinaviska Enskilda Banken Interest rate risks
(SEB) and Svenska Handelsbanken (SHB) for SEK 2,000m and a financing Interest risk pertains to the risk that changed interest levels could impact Ned-
agreement with the Swedish Export Credit Corporation (SEK) for SEK 500m. erman group’s income and cash flow. The Nederman group is exposed to inter-
The agreements have a three-year maturity with extension options for two est rate risk through its net debt. The group’s bank loans have floating interest
additional years. The agreements mature in March 2027 on exercise of the rates or a maximum term of six months, according to the funding agreement
option. At the end of the year, the scope within the agreement with SEB and with the group’s lenders. The usual fixed interest term is between one and
SHB had been utilised in an amount of SEK 1,438m (1,008). Accordingly, at the three months. A change in the interest rate of 1 percentage point would have
end of the period, the group had a credit facility of SEK 562m (492) within the affected net financial items in 2022 by SEK 12.7m (12.6), calculated on average
scope of Nederman’s loan agreement with SEB and SHB. At the end of the year, net debt for the year. The Nederman group has determined that reasonable
the scope within the agreement with SEK had been fully utilised. During the changes in interest rates do not affect the group’s earnings to such a material
year, borrowing increased by SEK 606m (-248). Under certain conditions, the extent that there is a need to secure interest rates through financial instru-
banks are entitled to terminate the agreements early. ments. This assessment is updated on an ongoing basis and may be reviewed in
the event of an increase in loan exposure.
The group’s agreements with SEB, SHB and SEK contain net debt covenants by
which the performance measure net debt/EBITDA may amount to a maximum The following table shows the effective rate of interest on the balance sheet
multiple of 3.5 and the interest-coverage ratio may not be less than 3.75. As of date and the financial liabilities’ maturity structure and interest rate negotia-
2022, the loan agreements are also covered by three sustainability covenants. tions. As of 2022, the loans are presented organised by currency and loan type.
All covenants were fulfilled on the balance sheet date. Comparative data were adjusted in a corresponding manner.

The effective rate of interest was 2.57 percent (1.53).

 CONSOLIDATED FINANCIAL STATEMENTS   101

3 Goal and policy regarding financial risk, continued

Nominal
amount Between
Nominal in original Within 6 6 and 12 Between Between Later than
2022, SEKm Currency interest currency Total months months 1 and 2 yrs 2 and 5 yrs 5 yrs
Bank loan* (revolving) SEK 2,84%-3,43% 926.5 1,027.7 11.9 11.9 23.8 980.1 -
Bank loan* (revolving) USD 4,87%-5,11% 49.0 567.4 6.6 6.6 13.2 541.0 -
Bank loan* (term loan) SEK 2,89%-3,07% 500.0 554.6 6.4 6.4 12.9 528.9 -
Undiscounted lease payments 217.1 37.1 41.3 47.4 71.6 19.7
Accounts payable 498.2 442.4 51.6 1.6 2.0 0.6
Total 2,865.0 504.4 117.8 98.9 2,123.6 20.3
* Sustainability linked loans

Nominal
amount Between
Nominal in original Within 6 6 and 12 Between Between Later than
2021, SEKm Currency interest currency Total months months 1 and 2 yrs 2 and 5 yrs 5 yrs
Bank loan (revolving) SEK 0.700% 926.5 946.4 7.0 7.0 932.4 - -
Bank loan (revolving) USD 0.980% 9.0 83.1 0.6 0.6 81.9 - -
Bank loan (term loan) SEK 0.700% 300.0 306.5 2.3 2.3 301.9 - -
Undiscounted lease payments 226.5 33.0 41.1 49.8 69.7 32.9
Accounts payable 411.9 378.5 26.4 3.4 3.6 -
Total 1,974.4 421.4 77.4 1,369.4 73.3 32.9

Credit risks
The risk that the group’s customers might not pay their accounts receivable exposure and translation exposure. Transaction exposure arises when the
and contract assets constitutes a customer credit risk. To limit this risk, the group’s companies buy in one currency and sell in another currency. In order
Nederman group employs credit policies that limit outstanding amounts and to limit transaction exposure in the Nederman group, the general rule is that
the credit period for different customers. For new customers and new mar- supply companies sell to sales companies in the sales companies’ local curren-
kets, letters of credit or advance payments normally apply. For established cies. In this way, the transaction exposure in sales companies is low. The largest
customer relationships, credit limits are carefully monitored to limit the risk. In production company is located in Sweden and 57 percent of purchases by this
some cases, credit insurance is used to secure accounts receivable. The group’s company are made in SEK. Other purchases are mainly in EUR and to a lesser
largest individual customer accounted for 1.0 percent of sales. The five largest extent in USD. Financial exposure arises when exchange rate fluctuations
customers accounted for 3.8 percent of sales. The company’s risk spread can impact the value of loans. Translation exposure arises when exchange rate
thus be regarded as very good. Ongoing risk assessments are carried out of fluctuations affect the value of assets and liabilities in foreign subsidiaries,
accounts receivable and contract assets, and given that customers operate in which comprises a currency exposure of equity.
several different industries and markets, the risks are deemed to be low.
Invoicing in the group in 2022
Provisions for bad debts are based on expected credit losses for their remain-
ing time to maturity. Impairment is carried out on an individual case assessment 30%
basis. The group’s bad debt losses in 2022 amounted to SEK 26.1m (5.5). The
higher bad debt losses for the year pertain primarily to customers in China.
Of the group’s total accounts receivable, net of the credit loss reserve, of SEK 24%
814.8m, 5.0 percent (3.5) comprises accounts receivable overdue by more than
90 days. At 31 December 2022, provisions for credit losses amounted to SEK
41.6m (26.5), equivalent to 4.9 percent (4.1) of the gross total accounts receiv- 18%
able. See also note 17, Accounts receivable.

In major projects recognised as contract assets or contract liabilities, payment 12%

terms with a fixed payment plan are applied, with the payments based on ful-
filment of the performance obligation (degree of completion). See also note 6,
Revenue from customer contracts. Expected losses are expensed as soon as 6%
they are known.

Foreign currency risks 0

USD EUR CHF CNY INR GBP NOK SEK AUD CAD DKK PLN THB TRL Other
Through its global operations, Nederman group is exposed to currency risk
since exchange rate fluctuations affect the group’s income and financial posi-
tion. The group’s currency exposure includes transaction exposure, financial Invoicing in the group is based on the group companies’ functional currencies.
102   CONSOLIDATED FINANCIAL STATEMENTS

3 Goal and policy regarding financial risk, continued

According to the group’s financial policy, 70 percent of the expected currency Translation exposure
flows in foreign currencies can be hedged for a maximum of eight months for- Net assets in the group are divided across the following currencies:
ward. In cases where there is currency exposure for tangible projects, the cur- Currency, SEKm 2022 2021
rency exposure is hedged. In 2022, Nederman group used no foreign exchange BRL 18.6 1% 13.1 1%
forwards to hedge currency exposure. CAD 18.9 1% 12.2 1%
CHF 22.2 1% -6.0 -0%
A change in exchange rates of +/- 10 percent (3) CNY 23.2 1% 27.1 2%
has an impact on the operating profit of: CZK 17.9 1% 17.6 1%
2022 2021 DKK 10.4 0% 7.0 0%
mSEK -10% +10% -3% +3% EUR 433.7 20% 246.7 14%
CNY -0.5 0.5 -0.5 0.5 GBP 28.1 1% 30.4 2%
EUR -11.5 11.5 -0.4 0.4 INR 7.3 0% -9.3 -1%
GBP -2.1 2.1 -0.5 0.5 NOK 41.3 2% 30.8 2%
NOK 0.4 -0.4 -1.4 1.4 PLN 212.0 10% 133.0 8%
PLN -8.3 8.3 -2.5 2.5 SEK 875.9 40% 889.4 52%
USD -11.4 11.4 -2.7 2.7 THB -70.7 -3% -68.8 -4%
The above table is based on the group’s net flows in these currencies as well as the TRL -9.7 -0% -16.3 -1%
translation impact on the group’s income statement USD 558.8 25% 413.9 24%
Other -1.4 -0% -3.4 -1%
Total 2,186.5 100% 1,717.4 100%

4 Acquisition of business operations

Accounting policies

Business acquisitions and divestments

Business acquisitions are recognised according to the acquisition meth- difference is positive. If the difference is negative, this amount is rec-
od. The cost of acquiring a business or company consists of the fair value ognised directly in the income statement. Acquisition-related costs, such
determined on the acquisition date of the acquired identifiable assets as fees for legal advice and due diligence, are expensed. Financial state-
and assumed liabilities, and any non-controlling interest. The difference ments from the acquired businesses are included in the consolidated
between the consideration transferred and the fair value of the acquired financial statements from the date of acquisition. Divested operations are
identifiable assets and assumed liabilities is recognised as goodwill if the consolidated until the date on which the controlling influence ceases.

Estimations and assessments

Conditional earn-out payments

Conditional earn-out payments are disbursed fully or partially depending out payment thus requires that estimations and assessments are made
on whether future profitability levels are met within a defined time peri- regarding profitability in the acquired subsidiary.
od (maximum 24 months). The determination of the conditional earn-

Nederman Holding AB’s holding of shares and participations in group companies at 31 December 2022 is presented in the disclosures in parent company note 13,
Shares and participations.

Ezi-Duct Pty Ltd nology and control solutions for industrial fume, dust and oil mist control
On 28 April 2022, Nederman acquired the business of the Australian company applications. Its unique sales approach, strong equipment range and turn-
Ezi-Duct Pty Ltd. Ezi-Duct manufactures and supplies ducting, fume extraction key capabilities have built a strong brand and global reputation. RoboVent is
and industrial air filtration equipment. In conjunction with the acquisition, the headquartered in Sterling Heights, Michigan, and has about 100 employees.
company Nordfab Pty Ltd was formed, which is included in Nederman’s Duct & RoboVent is part of Nederman’s Extraction & Filtration Technology Division.
Filter Technology division.
The acquisition price amounted to SEK 441.8m, funded by cash and existing
The acquisition price amounted to SEK 18.0m, of which SEK 4.8m constituted bank facilities. The acquired net assets amounted to SEK 169.8m. In the fourth
a deferred payment. The maximum deferred payment of SEK 4.8m is expected quarter 2022, the acquired value of the deferred tax asset was adjusted by
to be paid. The deferred payment is related to valuation assessment of tangi- SEK 14.8m following assessment of tax losses.The acquisition analysis result-
ble assests. The acquired net assets amounted to SEK 14.5m. The preliminary ed in goodwill of SEK 272.0m. Goodwill is mainly related to RoboVent’s strong
acquisition analysis resulted in goodwill of SEK 3.5m. Goodwill is mainly related market position in the US market and synergies with the Nederman group.
to strengthened market presence and an improved product range in Australia The acquisition’s impact on the group’s cash and cash equivalents amounted
and the Pacific region. The acquisition’s impact on the group’s cash and cash to SEK 426.2m.
equivalents amounted to SEK 13.2m. The acquisition analysis is preliminary due
to the ongoing valuation of fixed assets. Of the total intangible fixed assets, SEK 134.8m is related to customer con-
tracts, SEK 5.1m to the brand and SEK 0.9m to software. Acquisition-related
RoboVent expenditure amounted to SEK 7.1m and pertained to fees for consultants in
On 29 July 2022, Nederman acquired 100 percent of the shares in the North conjunction with the transaction, including due diligence and legal advice. This
American company RoboVent. RoboVent is the leader in air filtration tech- expenditure was charged to administrative expenses in operating profit.
 CONSOLIDATED FINANCIAL STATEMENTS   103

MBE AG
On 3 November 2022, Nederman acquired 100 percent of the shares in the The acquisition price amounted to SEK 19.9m, of which SEK 4.4m constituted
Swiss company MBE AG. For more than 35 years, MBE has sold gas measure- a deferred payment which is expected to be paid 24 months after the acquisi-
ment instruments and services for gas detection technology and continuous tion date. The acquisition was funded by cash and existing bank facilities. The
monitoring of liquid processes to the Swiss market. Its range comprises gas acquired net assets amounted to SEK 12.9m. The acquisition analysis resulted
measurement technology for a number of different applications, from gas in goodwill of SEK 7.0m. Goodwill is mainly related to strengthened presence
sampling and specific gas treatment to appropriate gas measurement instru- in the Swiss market and synergies with the Monitoring & Control Technology
ments. For many years, MBE has been a key distributor to Gasmet and as a division. The acquisition’s impact on the group’s cash and cash equivalents
result of this acquisition, Nederman’s Monitoring & Control Technology division amounted to SEK 5.9m. Acquisition-related expenditure amounted to SEK
and Gasmet are establishing direct sales and creating a platform for future 1.1m and pertained to fees for consultants in conjunction with the transac-
growth in Switzerland. tion, including due diligence and legal advice. This expenditure was charged to
administrative expenses in operating profit.

SEKm Ezi-Duct MBE AG RoboVent Total

Acquisition price 18.0 19.9 441.8 479.7
whereof deferred payment 4.8 4.4 - 9.2

Identifiable acquaired assets and liabilities, SEKm

Intangible fixed assets - - 140.8 140.8
Tangible fixed assets 11.4 0.9 4.0 16.3
Right-of-use assets - 0.8 7.7 8.5
Deferred tax assets - - 19.6 19.6
Inventories 4.2 3.3 22.0 29.5
Accounts receivables and other receivables - 2.8 110.0 112.8
Cash and cash equivalent - 9.6 15.6 25.2
Lease liabilities - -0.8 -7.7 -8.5
Accounts payable and other operating libilities -1.1 -1.9 -101.0 -104.0
Current tax liabilities - -1.3 - -1.3
Deferred tax liabilities - - -36.4 -36.4
Provisions - -0.5 -4.8 -5.3
Total identifiable net assets 14.5 12.9 169.8 197.2
Goodwill 3.5 7.0 272.0 282.5
Total 18.0 19.9 441.8 479.7
Transferred remuneration -13.2 -15.5 -441.8 -470.5
Acquired cash and cash equivalents - 9.6 15.6 25.2
Effect on consolidated cash and cash equivalents -13.2 -5.9 -426.2 -445.3

Net sales during holding time 34.1 2.0 150.7 186.8

Net sales 2022 before acquisition - 26.9 205.6 232.5
Total 34.1 28.9 356.3 419.3

Net profit during holding time -2.6 -0.8 6.3 2.9

Net profit 2022 before acquisition - 4.7 6.6 11.3
Total -2.6 3.9 12.9 14.2

If all acquisitions had taken place on January 1, 2022 the Group’s sales would have amounted to SEK 5,411.4m and the net result to SEK 340.0m

5 Segment reporting

Accounting policies

Operating segment
The group’s operations are managed and reported by business segment. Group finance, Group IT and Group HR. The item “Non-allocated” also per-
The organisation of the operating segments is based on technology, cus- tains to acquisition costs, financial income and expenses, and tax expens-
tomer structure and business logic, with its starting point in the group’s es. Assets included in working capital are defined as inventory, accounts
trademarks. This means that the operating segments are global. The receivable, contract assets, other receivables and prepaid expenses
group’s internal reporting system is built up in order to make it possible to and accrued income. Liabilities included in working capital are defined
follow the operating segments’ sales and operating profit. The segments as accounts payable, contract liabilities, other operating liabilities, and
are presented based on reports submitted to the chief operating deci- accrued expenses and prepaid income. Assets and liabilities that have not
sion-maker in order to assess performance and allocation of resources to been allocated between the segments are fixed assets except for good-
the segments. Segments are measured and consolidated in accordance will, cash and cash equivalents, tax receivables and tax liabilities (current
with the same principles as for the group as a whole. Inter-company trans- and deferred), financial assets and liabilities, provisions and pension liabil-
actions within and between segments take place on market conditions. ities. The segments’ capital expenditure in fixed assets includes all capital
The operating segments' results include earnings up to adjusted EBITA. expenditure in tangible and intangible fixed assets.
Earnings, assets and liabilities for the segments include directly attribut-
able items plus items that can be allocated to the segments in an appro- On a secondary level, the operations are monitored based on the following
priate way. Items that are recognised as “Non-allocated” pertain mostly regions: Americas (North and South America), EMEA (Europe, Middle East
to expenses related to the parent company Nederman Holding AB, which and Africa) and APAC (Asia-Pacific).
includes the central main office functions, such as Group management,
104   CONSOLIDATED FINANCIAL STATEMENTS

5 Segment reporting, continued

Operating segment External sales per operating segment, 2022
Nederman group’s operating segments are described Nederman Monitoring Monitor
on pages 44-53 and comprise: & Control Technology, 12% (13)
Duct

Nederman Duct & Filter

- Nederman Extraction & Filtration Technology Technology, 14% (12) 1 Process

- Nederman Process Technology Extraction

- Nederman Duct & Filter Technology Nederman Process Nederman Extraction &
Technology, 33% (32) Filtration Technology, 41% (43)
- Nederman Monitoring & Control Technology

Extraction & Duct & Monitoring Total

Filtration Process Filter & Control Non- Nederman
2022, SEKm Technology Technology Technology Technology allocated Elimination Group
Net sales, external customers 2,155.5 1,712.2 708.7 602.5 - - 5,178.9
Net sales, internal between operating segments 9.9 9.7 82.1 3.4 - -105.1 -
Net sales 2,165.4 1,721.9 790.8 605.9 - -105.1 5,178.9
Cost of material -944.5 -1,102.4 -324.3 -195.5 - 105.1 -2,461.6
Cost of remuneration to staff -620.5 -364.2 -213.2 -208.6 -106.5 - -1 513.0
Other costs -243.1 -155.4 -125.9 -105.2 -8.1 - -637.7
Adjusted EBITA 357.3 99.9 127.4 96.6 -114.6 - 566.6
Amortisation of intangible assets -78.0
Acquisition costs -8.4
Operating profit 480.2
Net financial items -41.4
Taxes -110.1
Net profit for the year 328.7

Assets included in working capital 905.2 677.5 205.8 300.2 160.5 -174.5 2,074.7
Goodwill 793.8 394.1 24.0 815.6 - - 2,027.5
Non-allocated assets - - - - 2,117.9 - 2,117.9
Total assets 1,699.0 1,071.6 229.8 1,115.8 2,278.4 -174.5 6,220.1

Liabilities included in working capital 622.9 731.4 110.0 96.9 132.8 -174.5 1,519.5
Non-allocated liabilities - - - - 2,514.1 - 2,514.1
Total liabilities 622.9 731.4 110.0 96.9 2,646.9 -174.5 4,033.6

Other segment information

Capital expenditure 38.4 10.9 42.2 56.4 22.6 - 170.5
Entered lease agreements during the year 15.9 18.0 11.8 3.8 1.3 - 50.8
Depreciation/Amortisation and impairment -75.4 -30.3 -19.9 -57.4 -18.8 - -201.8
Items not affecting cash flow other than depreciation/amortisation -3.1 4.6 1.8 -2.4 -0.2 - 0.7

Extraction & Duct & Monitoring Total

Filtration Process Filter & Control Non- Nederman
2021, SEKm Technology Technology Technology Technology allocated Elimination Group
Net sales, external customers 1,750.2 1,282.2 475.6 533.8 - - 4,041.8
Net sales, internal between operating segments 12.7 9.3 65.2 3.5 - -90.7 -
Net sales 1,762.9 1,291.5 540.8 537.3 - -90.7 4,041.8
Cost of material -727.9 -818.9 -195.9 -171.8 - 90.7 -1 823.8
Cost of remuneration to staff -499.1 -311.8 -152.2 -171.9 -87,9 - -1 222.9
Other costs -227.2 -109.9 -88.7 -72.7 -2,0 - -500.5
Adjusted EBITA 308.7 50.9 104.0 120.9 -89.9 - 494.6
Amortisation of intangible assets -63.4
Acquisition costs -1.3
Discontinuation of defined - benefit pensin plan 29.0
Operating profit 458.9
Net financial items -41.8
Taxes -111.8
Net profit for the year 305.3

Assets included in working capital 668.4 516.1 134.2 211.7 126.7 -166.4 1,490.7
Goodwill 467.4 342.6 18.5 780.7 - - 1,609.2
Non-allocated assets - - - - 1,629.1 - 1,629.1
Total assets 1,135.8 858.7 152.7 992.4 1,755.8 -166.4 4,729.0

Liabilities included in working capital 480.4 556.4 87.5 81.2 111.2 -166.4 1,150.3
Non-allocated liabilities - - - - 1,861.3 - 1,861.3
Total liabilities 480.4 556.4 87.5 81.2 1,972.5 -166.4 3,011.6

Other segment information

Capital expenditure 21.9 4.8 14.9 43.9 23.5 - 109.0
Entered lease agreements during the year 40.3 7.0 2.4 9.6 1.6 - 60.9
Depreciation/Amortisation and impairment -61.7 -27.4 -14.4 -52.7 -18.1 - -174.3
Items not affecting cash flow other than depreciation/amortisation -5.5 -3.2 -0.1 -4.9 -28.9 - -42.6
 CONSOLIDATED FINANCIAL STATEMENTS   105

Geographic areas
The group is presented below, divided into geographic regions. The information External sales by region, 2022
presented concerning the revenue for the geographic areas is grouped accord-
ing to where the customers are located. Information concerning fixed assets APAC
APAC, 21% (20)
and capital expenditure for the period in tangible and intangible assets, with Americas
the exception of goodwill, is based on the geographic areas where the assets
EMEA
are located. Fixed assets are defined as total assets less goodwill, non-current EMEA, 45% (50)

receivables and deferred tax assets. As of 2022, “Non-allocated” does not com-
prise a separate category, but all fixed assets and investments are allocated by
the regions below. This entails that the comparative data were adjusted in a Americas, 34% (30)

corresponding manner.

Rest of Rest of Rest of

2022, SEKm Sweden Germany UK EMEA USA Americas China India APAC Total
External net sales 134.7 413.8 266.5 1,235.9 1,453.0 324.4 364.4 300.0 686.2 5,178.9
Fixed assets 214.0 45.9 34.5 394.4 379.4 6.1 42.7 56.0 50.1 1 223.1
Capital expenditure 64.5 4.1 5.3 40.1 48.7 0.5 2.0 2.3 3.0 170.5

Rest of Rest of Rest of

2021, SEKm Sweden Germany UK EMEA USA Americas China India APAC Total
External net sales 125.5 342.1 207.3 1,163.1 996.4 245.8 378.4 142.5 440.7 4,041.8
Fixed assets 205.2 44.4 29.5 383.8 178.3 6.2 34.7 54.8 25.4 962.3
Capital expenditure 59.7 0.7 1.6 32.8 10.8 0.3 0.8 0.4 1.9 109.0

6 Revenue from customer contracts

Accounting policies

Nederman’s sales model tion to total costs for goods and services that have been promised accord-
Nederman’s customer offering encompasses everything from individual ing to the agreement. Project costs incurred are determined either on the
products, complete solutions, design, installation, and commissioning to basis of the value of the goods or services that have been transferred to
service. Based on these customer offerings, Nederman’s sales model is date or on the basis of measurements at the customer such as achieved
divided into three sales types: products, solutions, and service and after- milestones. The choice of method is consistent within individual projects.
market. Within each operating segment, revenue flows from the three
sales types are monitored, which is why these categories are considered to Solutions are recognised in the statement of financial position as contract
be the most relevant basis for classifying revenue. The classification pro- assets or as contract liabilities when Nederman or the customer has ful-
vides a good understanding of the group's revenue streams. filled a commitment, depending on the relationship between Nederman’s
performance and the customer’s payment. Contract assets include rec-
Sales of products ognised revenue for work performed that has not yet been invoiced. Con-
Nederman offers a broad range of standard products that solve common tract liabilities include advance payments from customers for which reve-
problems related to smoke, gas, particles, material recycling, work environ- nue is recognised when the performance obligation is completed.
ment and efficient production. Product sales are made primarily via distrib-
utors and resellers. Revenue from sales of products is recognised at a given The transaction price is the compensation that Nederman expects to be
point in time when the promised good are transferred to the customer and entitled to in exchange for transferring the promised goods and services
the customer obtains control over the product. The customer obtains con- to the customer in accordance with the contract. Expected credit losses are
trol when they receive the product, can control its use and obtain financial expensed immediately. Most projects are sold at a fixed price.
benefits from the asset. This normally occurs when the goods are made
available to the customer at the agreed time and place. At this time, Neder- Sales of service and aftermarket
man has the right to receive payment for the goods. The transaction price By offering qualified service with good availability, Nederman helps to
is the compensation that Nederman is entitled to in exchange for transfer- ensure continuous operation without expensive interruptions to custom-
ring promised goods to the customer. ers’ production. In addition to technical service, this area also includes ser-
vice contracts, spare parts and consumables.
Sales of solutions (project sales)
Solutions consist either of individual products in the Nederman range Revenue from sales within service and aftermarket is recognised when
which are assembled to build small or medium-sized customised systems, Nederman meets its performance commitment, which is at a given point
or large system solutions with a high element of special customisation. The in time when the promised goods or service is transferred to the customer
task of both variants is to solve complex tasks. Sales are conducted through and the customer obtains control over the goods or service. The customer
Nederman’s own sales organisation. In the sale of solutions, which contain obtains control when they receive the goods or service, can control their
a significant element of customisation, Nederman’s promise to custom- use and obtain financial benefits from the asset or service. This normally
ers is to deliver integrated system solutions, and not individual goods or occurs when the goods are made available to the customer at the agreed
services separately. It is the total performance to which the customer has time and place or when the service is performed and the customer can ben-
agreed. When it comes to sales within the solutions segment, this means efit from the service provided. The transaction price is the compensation
that separate performance obligations cannot be identified and sales that Nederman is entitled to in exchange for transferring promised goods
are therefore recognised as revenue over time. For sales recognised over or services to the customer.
time, the progress towards full completion of the performance obligation
is measured. This is carried out on the basis of project costs incurred in rela- For warranty commitments see note 25, Other provisions.
106   CONSOLIDATED FINANCIAL STATEMENTS

6 Revenue from customer contracts, continued

Estimations and assessments

Revenue recognition relating to sales of solutions

Revenue recognition relating to sales of solutions, which is recognised i.e. assessing the extent to which accrual of the projects has occurred,
over time, is made by measuring the progress towards completion of the requires estimates. Sales from solutions accounted for 43 percent (41) of
performance obligation. Establishment of the performance obligation, the group's total sales in 2022.

Allocation of sales on segments and sales types

Service and
2022, SEKm Products Solutions aftermarket Total
Nederman Extraction & Filtration Technology 819.7 916.4 419.4 2,155.5
Nederman Process Technology - 1,278.4 433.8 1,712.2
Nederman Duct & Filter Technology 694.4 14.3 - 708.7
Nederman Monitoring & Control Technology 510.0 19.2 73.3 602.5
Total Nederman group 2,024.1 2,228.3 926.5 5,178.9

Service and
2021, SEKm Products Solutions aftermarket Total
Nederman Extraction & Filtration Technology 712.0 712.4 325.8 1,750.2
Nederman Process Technology - 943.8 338.4 1,282.2
Nederman Duct & Filter Technology 475.6 - - 475.6
Nederman Monitoring & Control Technology 474.2 6.5 53.1 533.8
Total Nederman group 1,661.8 1,662.7 717.3 4,041.8

As of 2022, revenue from customer contracts are presented based on external sales. This entails that internal sales between the segments is not included.
Comparative data were adjusted in a corresponding manner.

Sales of solutions (project sales)

At the beginning of 2022, contract liabilities amounted to SEK 404.2m (260.1), At the end of 2022, contract liabilities amounted to SEK 615.3m. The group’s
of which SEK 330.4m (248.7) was recognised as revenue in the current year. strong order backlog, with advance payments received as a result, is the reason
The opening contract liability in 2022 comprised partly of projects only sched- that the closing contract liability is higher compared with the preceding year.
uled to commence during 2023, which means that the time from the advance The assessment is that the majority of the contract liabilities will be recognised
payments until the start of the projects is longer than is generally the rule for as revenue in 2023.
projects in the Nederman group. The remaining part of the opening contract
liability is deemed to be recognised as revenue during 2023.

Contract assets, SEKm 2022 2021

Work performed that has not yet been invoiced 165.3 126.8
Total 165.3 126.8

Contract liabilities, SEKm 2022 2021

Advances from customers in projects 598.8 393.0
Other advances from customers 16.5 11.2
Total 615.3 404.2

7 Other operating income and expenses

Other operating income, SEKm 2022 2021

Profit from sale of fixed assets 0.9 5.4
Recovered bad debt losses 4.0 2.8
Exchange gains on operating receivables/liabilities 18.4 -
Discontinuation of defined-benefit pension plan - 29.0
Other 8.9 8.6
Total 32.2 45.8

Other operating expenses, SEKm 2022 2021

Loss from sales of fixed assets -0.1 -1.0
Bad debt losses -26.1 -5.5
Exchange losses on operating receivables/liabilities - -3.0
Other -13.5 -5.2
Total -39.7 -14.7

Total other operating income and expenses, SEKm -7.5 31.1

For further information about the credit loss reserve, see note 17, Accounts receivable.
 CONSOLIDATED FINANCIAL STATEMENTS   107

8 Employees

Accounting policies

Employee benefits Share-based incentive programme

Employee benefits are recognised as costs on receipt of the related ser- The Annual General Meeting held on 26 April 2021 approved the Board’s
vices. A provision is recognised for expected bonus payments when the proposal that the annual programmes for variable remuneration should be
group has an obligation to make such payments as a result of the corre- supplemented with a long-term incentive (LTI) programme. The LTI pro-
sponding services being received or other contractual conditions being gramme comprises the two financial years 2021 and 2022 and is targeted
met. in a way that makes it particularly favourable for the company’s sharehold-
ers. The outcome of the LTI programme for senior executives of the Ned-
Remuneration policy erman group may amount to a maximum of 35 percent of annual salary for
The prevailing guidelines for executive remuneration were adopted by the the CEO and 14-20 percent of annual salary for other senior executives. An
Annual General Meeting in 2022 and the principles resolved can be sum- outcome requires that a minimum level of accumulated earnings per share
marised as follows. established for the 2021 and 2022 financial years is achieved or exceeded.
The remuneration for the senior executive according to the terms and con-
Types of remuneration ditions (net after tax) is to be invested in Nederman shares. The sharehold-
A prerequisite for the successful implementation of the company’s busi- ing must be retained by the senior executive for a minimum of three years.
ness strategy and safeguarding of its long-term interests, including its Investment in shares can be made via the exchange or through the transfer
sustainability, is that the company is able to recruit and retain qualified of treasury shares, with the Board of Directors intending in the case of the
personnel. The objective of Nederman’s guidelines for executive remu- latter to submit a proposal for resolution on the transfer of treasury shares
neration is therefore to offer competitive remuneration on market terms, at the 2023 Annual General Meeting. The outcome for the LTI programme
so that competent and skillful personnel can be attracted, motivated and 2021-2022 amounted to SEK 5.5m.
retained. These guidelines enable the company to offer the executive
management competitive total remuneration. The remuneration shall be Pension benefits
on market terms and may consist of the following components: fixed sala- For the CEO, pension benefits shall be premium-based. The pension premi-
ry, variable remuneration, pension benefits and other benefits. The remu- ums for premium-based pension shall amount to not more than 35 percent
neration is determined by the Remuneration Committee in accordance of the pension based salary. For other executives, pension benefits shall
with principles for executive remuneration adopted by the Annual General be based on a contractual ITP plan or be premium-based, unless the indi-
Meeting. vidual concerned is subject to defined-benefit pension under mandatory
collective agreement provisions. Variable cash remuneration shall qualify
Fixed salary for pension benefits. Pension premiums that follow from the contractual
Fixed salary is paid for satisfactory work. ITP plan or are premium-based, shall amount to not more than 35 percent
of the pension based salary, unless other premium levels apply accord-
Variable remuneration ing to applicable ITP plan. For employment governed by rules other than
The variable remuneration shall be linked to predetermined, well-defined Swedish, pension benefits and other benefits may be duly adjusted for
and measurable financial criteria. The satisfaction of criteria for awarding compliance with mandatory rules or established local practice, taking into
variable remuneration shall be measured over a period of one year. The account, to the extent possible, the overall purpose of these guidelines.
variable remuneration may amount to not more than 50 percent of the
total fixed salary under the measurement period for the CEO and not more Other benefits
than 30 percent of the total fixed salary under the measurement period Other benefits may include, for example, life insurance, health and medical
for other senior executives. The criteria for variable remuneration shall insurance and company cars. Such benefits may amount to not more than
mainly relate to the group’s profitability, working capital development and 20 percent of the fixed annual salary.
sustainability goals that are linked to the business. Variable remuneration
may also be related to individual criteria. The criteria shall be designed so as Termination of employment
to contribute to the company’s business strategy and long-term interests, The notice period may not exceed 24 months if notice of termination of
including its sustainability. Further variable remuneration may be awarded employment is made by the company for the CEO and twelve months for
in extraordinary circumstances, provided that such extraordinary arrange- other executives. Fixed salary during the period of notice and severance
ments are limited in time and only made on an individual basis, either for pay may together not exceed an amount equivalent to the CEO’s fixed sal-
the purpose of recruiting or retaining executives, or as remuneration for ary for two years, and one year for other executives. When termination is
extraordinary performance beyond the individual’s ordinary tasks. Such made by the executive, the notice period may not exceed six months, with-
remuneration may not exceed an amount corresponding to 50 percent of out any right to severance pay.
the fixed annual salary and may not be paid more than once each year per
individual. Any resolution on such remuneration shall be made by the Board Principles for compensation to the Board of Directors
of Directors based on a proposal from the Remuneration Committee. Directors’ fees are paid to the Chairman of the Board of Directors and
other members according to the decision of the Annual General Meeting.
Employee representatives in the Board of Directors do not receive direc-
tor’s fees.
108   CONSOLIDATED FINANCIAL STATEMENTS

8 Employees, continued

Expenses for remuneration to employees, SEKm 2022 2021

Salaries and other remuneration 1,269.9 1,012.0
Pension expenses, defined-benefit plans (see also note 24) 6.5 9.3
Pension expenses, defined-contribution plans (see also note 24)* 66.3 54.3
Social security expenses 170.3 147.3
Total 1,513.0 1,222.9
* Of the parent company’s pension costs SEK 1.8m (1.6) pertain to the Board of Directors and the CEO for the parent company. There are no outstanding pension obligations to the group’s
Board of Directors, CEO and senior executives.

Salaries and other remuneration allocated between the Board of Directors and other employees, SEKm 2022 2021
Board of Directors, CEO and senior executives 105.0 96.9
(of which variable compensation) (15.7) (13.2)
Other employees 1,164.9 915.1
Total 1,269.9 1,012.0

2022 2021
Average number of emplyees Women Men Total Women Men Total
Australia 12 45 57 5 19 24
Belgium 3 13 16 3 12 15
Brazil 7 17 24 7 19 26
Denmark 9 64 73 9 65 74
England 25 85 110 17 88 105
Finland 27 59 86 28 57 85
France 4 7 11 5 7 12
Hong Kong 2 6 8 4 4 8
India 8 265 273 8 220 228
Indonesia 1 11 12 1 11 12
Canada 7 25 32 9 20 29
China 65 185 250 62 211 273
Malaysia 1 5 6 1 5 6
Mexico 4 7 11 4 6 10
The Netherlands 1 21 22 1 21 22
Norway 8 67 75 6 65 71
Poland 34 172 206 34 171 205
Russia - 2 2 1 3 4
Switzerland 4 36 40 6 36 42
Singapore 3 5 8 3 6 9
Spain 3 13 16 3 14 17
Sweden 64 153 217 69 157 226
Thailand 15 32 47 14 32 46
Czech Republic 2 17 19 2 17 19
Turkey 3 21 24 4 19 23
Germany 36 149 185 35 142 177
Hungary - - - - 2 2
USA 123 330 453 111 268 379
Austria 1 4 5 1 4 5
Total 472 1,816 2,288 453 1,701 2,154
Of whom, senior executives 32 137 169 25 120 145

Gender breakdown of senior executives, percentage of women 2022 2021

Board of Directors 7% 11%
Other senior executives 19% 15%

Compensation ratio, Mkr 2022 2021 Nederman does not report median compensation but makes an exception
a) CEO Sven Kristensson's compensation* 9.2 7.2 by reporting the average compensation instead. The highest paid person
b) Change vs 2021 27% in the group is CEO Sven Kristensson. The CEO’s remuneration is excluded
c) Other employees' compensation 1,164.9 915.1 from other employees’ salaries. The average number of employees is cal-
d) Average number of employees 2,288 2,154 culated on a full-time equivalent basis. The compensation includes basic
e) Employees’ average salary*: c /(d -1) 0.51 0.43 salary, variable compensation and LTI
f) Change vs 2021 20%
Compensation ratio: a/e 18.1 17.0
Change in compensation ratio: b/f 1.4
* Excludes pension costs and other benefits
 CONSOLIDATED FINANCIAL STATEMENTS   109

Remuneration to senior executives

Base salary Variable Other Pension

2022, SEKt Board fees remuneration LTI benefits expenses Total
Chairman of the board Johan Menckel 802 - - - - 802
Member of the board Anna Kinberg Batra (resigning) 300 - - - - 300
Member of the board Gunilla Fransson 326 - - - - 326
Member of the board Ylva op den Velde Hammargren 404 - - - - 404
Member of the board Sam Strömerstén 368 - - - - 368
CEO Sven Kristensson 5,452 2,009 1,747 188 1,771 11 ,167
Other senior executives (9 individuals) 20,766 4,703 3,786 1,277 4,712 35,244
Total 28,418 6,712 5,533 1,465 6,483 48,611

Base salary Variable Other Pension

2021, SEKt Board fees remuneration LTI benefits expenses Total
Chairman of the board Johan Hjertonsson 775 - - - - 775
Member of the board Gunilla Fransson 290 - - - - 290
Member of the board Ylva op den Velde Hammargren 390 - - - - 390
Member of the board Johan Menckel 315 - - - - 315
Member of the board Sam Strömerstén 355 - - - - 355
CEO Sven Kristensson 4,844 2,400 - 150 1,616 9,010
Other senior executives (9 individuals) 19,467 5,116 - 1,100 4,743 30,426
Total 26,436 7,516 - 1,250 6,359 41,561

9 Expenses by nature

Operating expenses by nature, SEKm 2022 2021

Cost of material 2,461.6 1,823.7
Cost of remuneration to staff 1,513.0 1,222.9
Other external costs and other personnel costs 506.4 391.8
Acquisition costs 8.4 1.3
Depreciation and amortisation 201.8 174.3
Total 4,691.2 3,614.0
110   CONSOLIDATED FINANCIAL STATEMENTS

10 Fees and expenses to auditors

SEKm 2022 2021

EY
Audit assignment 6.9 6.2
Audit-related fee 0.9 0.7
Other assignments 0.4 0.2
Total 8.2 7.1

Other auditors
Audit assignment 1.7 1.4
Tax advice 0.4 0.2
Other assignments 0.1 -
Total 2.2 1.6

Total fees and expenses to auditors 10.4 8.7

Audit assignments refer to the statutory audit of annual and consolidated statutes or agreements. The amount primarily pertains to a review of the six-
accounts, the administration of the Board of Directors and CEO, and auditing month report and the Sustainability Report. Tax advice includes both advice
and other verifications as agreed. Audit-related fee involve quality assurance and a review of taxation compliance.
services to be conducted in accordance with legislation, articles of association,

11 Financial income and expenses

Accounting policies

Financial income and expenses

Financial income and expenses consist of interest income on bank deposits effective interest method. This means that interest income and interest
and interest-bearing financial assets, interest expenses on loans, dividend expenses include accrued transaction costs and any discounts, premiums
income, foreign exchange differences on interest-bearing financial assets and other differences between the initial carrying amount of the receiv-
and liabilities, and the realised and unrealised profits and losses from deriv- able or liability and the estimated future receipts and payments during the
atives that hedge future cash flows. The derivatives are measured at fair contract period. The interest component related to lease payments is rec-
value through profit or loss and hedge accounting is not applied to these ognised in the income statement through the application of the effective
derivatives. Interest income on interest-bearing financial receivables and interest method. Dividend income is recognised when the shareholder’s
interest expenses on interest-bearing liabilities are calculated using the right to receive payment is established.

SEKm 2022 2021

Financial income
Interest income on bank deposits 11.0 1.4
Other interest income - 0.7
Exchange rate changes 12.0 1.3
Total 23.0 3.4

Financial expenses
Interest expenses, credit institutions -50.9 -24.6
Interest expenses, leasing liabilities -9.5 -11.2
Interest expenses, other -3.5 -4.9
Exchange rate changes -0.5 -4.5
Total -64.4 -45.2

Net financial items -41.4 -41.8

 CONSOLIDATED FINANCIAL STATEMENTS   111

12 Income tax
Accounting policies

Income tax
Income tax consists of the sum of current tax and deferred tax. Income date. Temporary differences in participations in subsidiaries are not taken
tax is recognised in the income statement except when the underlying into account as the group can control the time of reversal of these and it
transaction is recognised under other comprehensive income or directly is likely that they will not be reversed in the foreseeable future. Nor are
against equity, in which case the associated tax effect is recognised in the temporary differences in goodwill taken into account. Deferred tax assets
equivalent way. Current tax is the tax payable or refundable for the cur- in regard to deductible temporary differences and loss carryforwards are
rent year, applying the tax rates enacted or substantively enacted at the only recognised to the extent it is probable they will be able to be utilised
balance sheet date. This includes any adjustment of current tax attribut- against future profits. The value of deferred tax assets is reduced when
able to prior periods. A current tax liability or asset is recognised for the it is no longer considered likely that they can be utilised. Deferred tax on
estimated tax to be paid or received for the current or prior years. Deferred temporary differences attributable to leases is recognised net of right-of-
tax is calculated using the balance sheet method on the basis of temporary use asset and the lease liability. However, gross recognition is made in the
differences between the tax values of assets and liabilities and the carry- disclosures on leases below, which means that deferred tax attributable to
ing amounts recognised in the group. Temporary differences that arise on right-of-use assets and deferred tax attributable to the lease liability are
initial recognition of an asset or liability do not give rise to any deferred tax recognised separately. Deferred tax assets and liabilities are offset when
asset or liability, apart from when it pertains to a business combination or there is a legal right to offset current tax assets and liabilities and when the
other acquisition, and where it does not impact recognised or taxable prof- deferred income taxes relate to the same taxation authority.
it, and in cases in which the transactions result in an asset and a liability.
Deferred tax is calculated at a nominal amount applying the tax rates and
tax laws that
Estimations and are enacted or substantively enacted on the balance sheet
assessments

Estimations and assessments

Deferred tax and uncertainty in income tax processes

Wherever uncertainty occurs in the treatment of income tax, an assess- When calculating the deferred tax asset or liability, assumptions are made
ment is made of the probability that the tax agency or court will accept the regarding the probability of deferred tax assets being used for settlement
tax treatment in the declaration of income, and the effect of the uncertain- of future taxable gains. The fair value of these future taxable gains may
ty is estimated and recognised in the financial statements as a tax liability deviate in terms of the future business climate and earnings capacity or
in accordance with IFRIC 23. changed tax rules.

Reported in the consolidated income statement

SEKm 2022 2021
Current tax expense (-)
Tax expense for the period -128.5 -102.6
Adjustment of tax relating to previous years 1.9 -7.7
Total -126.6 -110.3
Deferred tax expense (-) /tax income (+)
Deferred tax concerning temporary differences 11.8 2.7
Utilisation of previously activated loss carryforwards -1.5 -0.9
Revaluation of loss carryforwards -0.4 -4.8
Deferred tax income in tax loss carryforwards capitalised during the year 6.6 1.5
Total 16.5 -1.5
Total consolidated tax expenses -110.1 -111.8

Reconciliation of effective tax

The Swedish corporate income tax rate is 20.6 percent. The primary reasons for the difference in tax rate between Swedish income tax and the group’s tax
rate based on the earnings after financial items are indicated in the table below.

Effective tax 2022 2022, SEKm 2021 2021, SEKm

Profit before tax 438.8 417.1
Tax according to the applicable tax rate for the Parent company 20.6% -90.4 20.6% -85.9
Effect of other tax rates for foreign subsidiaries 2.5% -10.9 1.4% -5.9
Non-taxable income -0.2% 1.0 -1.3% 5.5
Non-tax deductible expenses 1.0% -4.4 2.2% -9.2
Revaluation of temporary differences 0.3% -1.1 -0.4% 1.6
Increase of tax loss carryforwards without corresponding capitalisation of deferred tax 2.1% -9.9 2.6% -11.0
Utilisation or revaluation of previously non-capitalised tax loss carryforwards -1.4% 6.0 -0.5% 2.1
Tax relating to previous years -0.4% 1.9 1.9% -7.7
Effect of changes in tax rates and tax rules -0.0% 0.2 0.0% -0.1
Other 0.6% -2.5 0.3% -1.2
Reported effective tax 25.1% -110.1 26.8% -111.8

Current tax assets amount to SEK 65,4m (51,1) and represent the recoverable amount of current tax on the result for the year.
112   CONSOLIDATED FINANCIAL STATEMENTS

12 Income tax, continued

Reported in consolidated statement of financial position
2022 2021
Deferred tax assets and liabilities, SEK m Assets Liabilities Net Assets Liabilities Net
Intangible fixed assets 2.5 102.8 -100.3 0.5 68.9 -68.4
Tangible fixed assets 5.7 19.4 -13.7 6.2 18.0 -11.8
Right-of-use asset - 42.7 -42.7 - 42.6 -42.6
Financial assets 0.3 0.6 -0.3 0.1 0.6 -0.5
Inventories 21.2 0.4 20.8 32.4 0.1 32.3
Accounts receivable 14.3 9.4 4.9 12.6 2.6 10.0
Long term liabilities 0.1 0.1 -0.0 0.1 - 0.1
Provision for pensions 5.9 2.0 3.9 11.7 0.2 11.5
Provisions 23.1 - 23.1 19.9 - 19.9
Lease liabilities 44.8 - 44.8 44.8 - 44.8
Short term liabilities 23.1 26.0 -2.9 9.7 35.7 -26.0
Loss carryforwards 48.0 0.6 47.4 28.2 0.5 27.7
Tax assets/liabilities 189.0 204.0 -15.0 166.2 169.2 -3.0
Netting -85.0 -85.0 - -97.7 -97.7 -
Deferred tax assets/liabilities according to statement of financial position 104.0 119.0 -15.0 68.5 71.5 -3.0

The majority of recognised loss carryforwards are not time limited.

Unrecognised tax loss carryforwards

Deductible temporary differences and loss carryforwards for which deferred tax assets have not been reported in the consolidated statement of financial
position:
SEKm 2022 2021
Unrecognised tax loss carryforwards 251.0 247.5

Unrecognised tax loss carryforwards would correspond to a deferred tax asset of SEK 61.2m. Unrecognized deferred tax loss carryforwards are mainly related
to losses in France, India, Indonesia, China, the Netherlands, Thailand, Germany and the US, with the current assessment that it is not probable that the
group will be able to use them for settlement of future taxable gains. The majority of the unrecognised tax loss carryforwards are not time limited and the
remaining portion are mainly time limited to 2024-2027.

Change in deferred tax on temporary differences and losses carried forward

Balance as of Recorded Recorded in Balance as of
1 January over income other compre- Translation Acquisitions 31 December
SEKm 2022 statement hensive income difference of business 2022
Intangible fixed assets -68.4 6.6 - -2.1 -36.4 -100.3
Tangible fixed assets -11.8 -0.7 - -0.1 -1.1 -13.7
Right-of-use asset -42.6 0.2 - -0.3 - -42.7
Financial assets -0.5 -1.8 - 0.1 1.9 -0.3
Inventories 32.3 -11.0 - -0.5 - 20.8
Accounts receivable 10.0 -4.9 - -0.2 - 4.9
Long term liabilities 0.1 -0.1 - -0.0 - -0.0
Provision for pensions 11.5 0.4 -8.0 0.0 - 3.9
Provisions 19.9 0.0 - -0.2 3.4 23.1
Lease liabilities 44.8 0.0 - - - 44.8
Short term liabilities -26.0 23.1 - -0.4 0.4 -2.9
Loss carryforwards 27.7 4.7 - -0.0 15.0 47.4
Total -3.0 16.5 -8.0 -3.7 -16.8 -15.0

Balance as of Recorded Recorded in Balance as of

1 January over income other compre- Translation Acquisitions 31 December
SEKm 2021 statement hensive income difference of business 2021
Intangible fixed assets -65.8 0.3 - -0,3 -2.6 -68.4
Tangible fixed assets -11.0 -0.8 - 0.0 - -11.8
Right-of-use asset -46.2 4.1 - -0.5 - -42.6
Financial assets -1.0 0.5 - -0.0 - -0.5
Inventories 47.9 -15.4 - -0.2 - 32.3
Accounts receivable -6.2 16.2 - -0.0 - 10.0
Long term liabilities 0.4 -0.2 - -0.1 - 0.1
Provision for pensions 18.7 -3.3 -3.8 -0.1 - 11.5
Provisions 18.9 1.1 - -0.1 - 19.9
Lease liabilities 49.6 -4.3 - -0.5 - 44.8
Short term liabilities -30.4 4.5 - -0.1 - -26.0
Loss carryforwards 32.0 -4.2 - -0.1 - 27.7
Total 6.9 -1.5 -3.8 -2.0 -2.6 -3.0
 CONSOLIDATED FINANCIAL STATEMENTS   113

13 Intangible fixed assets

Accounting policies

Research and development

Costs for development, where research results or other knowledge is ing unit is determined based on value in use. Nederman group’s model for
applied to achieve new or improved products or processes, are recognised measurement is based on a discounted cash-flow model, with a forecast
as an asset in the balance sheet if the product or process is technically and period of five years. The measurement is based on a financial plan, which
commercially feasible and the company has sufficient resources to com- is part of Nederman group’s financial planning process and corresponds
plete development and thereafter use or sell the intangible asset. The to the management’s best assessment of the operations’ development.
carrying amount includes the cost of materials and other direct expenses Growth is based on historical growth, estimated market growth and the
that can be attributed to the asset in a reasonable and consistent manner. anticipated price trend. The forecasts reflect previous experience and
Development costs are recognised in the balance sheet at cost less accu- external sources of information. Assumed growth is based on a cautious
mulated amortisation and any impairment losses. Expenditure on research assumption and does not exceed the long-term growth of the industry as
aimed at obtaining new scientific or technical knowledge is recognised as a whole. Any impairment losses are charged to operating income and not
an expense in the income statement when incurred. subsequently reversed.

Customer relations Additional expenses

Customer relationships acquired through business acquisitions are rec- Additional expenses for capitalised intangible assets are recognised as an
ognised at fair value at the acquisition date. Customer relationships with asset in the balance sheet only when they increase the future economic
a finite life are measured at cost less amortisation and any accumulated benefits of the specific asset to which they relate. All other expenses are
impairment losses. expensed when they arise.

Trademarks Amortisation and impairment losses with finite useful life

Trademarks acquired through business acquisitions are recognised at fair Intangible assets except goodwill and trademarks are amortised over their
value at the acquisition date. Trademarks with an indefinite life are allocat- estimated useful life. Amortisation is recognised in the income statement
ed to the cash-generating units or groups of cash generating units that are on a straight-line basis over the intangible assets’ estimated useful life.
expected to benefit from the trademark. The cash-generating units com- The estimated useful lives are:
prise the group’s operating segments. The useful life is deemed indefinite
if it is a question of a well-established trademarks in its market, which the - Capitalised development expenditure 5 years
group intends to maintain and develop further. Trademarks are tested for - Computer programmes 3–5 years
impairment annually and in the event of an indication of impairment. Other - Customer relations 10 years
trademarks are amortised over their estimated useful life. Any impairment
losses are charged to operating income. Impairment testing is carried out if any event occurs or circumstanc-
es change that indicate that the carrying amount may have decreased.
Goodwill Annual impairment testing is also conducted of capitalised development
Goodwill represents the difference between the consideration trans- expenditure for products and software not yet in use. An impairment loss
ferred for the business and the fair value of acquired identifiable assets is recognised when an asset’s or cash-generating unit’s carrying amount
and assumed liabilities. Goodwill represents the future economic benefits exceeds its recoverable amount. The recoverable amount is the higher
arising from the business acquisitions that are not individually identified of fair value less selling expenses and value in use. When calculating the
and separately recognised, and comprise strategic business values. Good- value in use, future cash flows are discounted using a discount rate that
will is allocated to the cash-generating units or groups of cash-generating reflects a risk-free interest rate and the risk associated with the specific
units that are expected to benefit from synergies from the acquisition. The asset. Previously recognised impairment losses are reversed if the reasons
cash-generating units comprise the group’s operating segments. Goodwill for the earlier impairment no longer exist. However, reversal will not be
is tested annually for impairment, or more frequently if there are indica- for an amount that is greater than that which the carrying amount would
tions of a reduction in value. If the carrying amount of the tested cash-gen- have been if the impairment had not been recognised in previous periods.
erating unit exceeds the estimated recoverable amount, the difference is Impairment losses are charged to operating income.
recognised as an impairment. The recoverable amount for a cash-generat-

Estimations and assessments

Examination for impairment of goodwill and

other intangible fixed assets
The book value of goodwill is reviewed at least once a year with respect been made. Changed conditions for these assumptions and estimations
to the possible need for impairment. The review requires an assessment might have an effect on the value of the goodwill. The senior executives
of the value in use of the cash-generating unit, or group of cash-gener- are of the opinion that no reasonable changes in important assumptions
ating units, to which the goodwill value relates. This requires that several at the impairment test of the cash-generating units will result in a recover-
assumptions about the future situation and estimates of parameters have able amount lower than the carrying amount.
114   CONSOLIDATED FINANCIAL STATEMENTS

13 Intangible fixed assets, continued

2022
Capitalised Current
development Computer Customer Trade- investments
SEKm expenditure programs relations marks Goodwill and advances Total
Accumulated cost
Opening balance 419.9 197.3 111.5 174.5 1,609.2 9.1 2,521.5
Business acquisition - 1.2 134.8 5.1 282.5 - 423.6
Internally developed assets 53.9 - - - - - 53.9
Other capital expenditure - 16.3 - - - 27.4 43.7
Sold and scrapped - -10.5 - - - - -10.5
Reclassifications 0.3 6.0 - - - -4.2 2.1
Translation differences 15.1 4.1 14.3 21.4 135.8 1.2 191.9
Closing balance 489.2 214.4 260.6 201.0 2,027.5 33.5 3,226.2

Accumulated amortisation and impairment

Opening balance -220.6 -132.1 -45.0 -61.4 - - -459.1
Business acquisition - -0.3 - - - - -0.3
Sold and scrapped - 10.5 - - - - 10.5
Amortisation -38.4 -20.4 -18.5 -0.7 - - -78.0
Translation differences -6.9 -3.7 -5.4 -9.0 - - -25.0
Closing balance -265.9 -146.0 -68.9 -71.1 - - -551.9

Carrying amount -
Opening balance 199.3 65.2 66.5 113.1 1,609.2 9.1 2,062.4
Closing balance 223.3 68.4 191.7 129.9 2,027.5 33.5 2,674.3

2021
Capitalised Current
development Computer Customer Trade- investments
SEKm expenditure programs relations marks Goodwill and advances Total
Accumulated cost
Opening balance 407.9 153.0 106.4 162.6 1,514.7 29.4 2,374.0
Business acquisition 13.6 0.2 - - 22.8 - 36.6
Internally developed assets 41.0 - - - - - 41.0
Other capital expenditure - 19.8 - - - 9.0 28.8
Sold and scrapped -50.6 -7.4 - - - - -58.0
Reclassifications - 29.5 - - - -29.5 -
Translation differences 8.0 2.2 5.1 11.9 71.7 0.2 99.1
Closing balance 419.9 197.3 111.5 174.5 1,609.2 9.1 2,521.5

Accumulated amortisation and impairment

Opening balance -231.6 -119.2 -32.3 -57.6 - - -440.7
Business acquisition - -0.1 - - - - -0.1
Sold and scrapped 49.8 7.4 - - - - 57.2
Amortisation -34.6 -18.1 -10.7 - - - -63.4
Translation differences -4.2 -2.1 -2.0 -3.8 - - -12.1
Closing balance -220.6 -132.1 -45.0 -61.4 - - -459.1

Carrying amount
Opening balance 176.3 33.8 74.1 105.0 1,514.7 29.4 1,933.3
Closing balance 199.3 65.2 66.5 113.1 1,609.2 9.1 2,062.4

The Group's expenses for developement of the existing product range and new products amounted to SEK 72,5m (57.0). SEK 53,9m (41.0) was capitalised in
the consolidated statement of financial position.

Capitalised development expenditure is primarily related to investments in the group’s digital product offering where the remaining amortisation period is
approximately two years and to acquired development expenditure where the remaining amortisation period is approximately six years. Customer relations
were mainly established in the acquisitions of RoboVent and Gasmet where the remaining amortisation period is approximately seven years.

Research and development expenses in relation to sales

SEKm SEKm
6000 150

5000
120
4000
90
3000
60
2000 Sales
30 Total research and development expenses
1000
Research and development expenses recognised in the income statement
0 0 Capitalised development expenditure reported in financial position
2018 2019 2020 2021 2022
 CONSOLIDATED FINANCIAL STATEMENTS   115

13 Intangible fixed assets, continued

Amortisation and impairment, SEKm 2022 2021
Amortisation is included in the following rows in the income statement:
Cost of sold goods -55.7 -40.7
Selling expenses -5.9 -5.4
Administrative expenses -16.4 -17.3
Total -78.0 -63.4

Trademarks
The trademarks that have been identified and valued were established in con- od beyond five years has been calculated using a multiple applied to estimated
nection with the 2012 acquisition of EFT, with the trademarks MikroPul and sustainable cash flow. When calculating the present value of expected future
LCI, the 2018 acquisition of Auburn FilterSense and Luwa, the 2019 acquisition cash flows, the current weighted average capital cost (WACC) for the market
of Gasmet and the 2022 acquisition of RoboVent. The cost of the trademarks is used. For 2022, the discount rate amounted to 11.33 percent (9.75). Impair-
were established at the time of the acquisition under the so-called relief from ment testing is done in the fourth quarter, or whenever the need arises, and
royalty method. The impairment test includes an assessment of the royalty with the assumptions used showed there was no need for any impairment of
rate on the acquisition date and estimated future sales performance for five trademarks with an indefinite useful life. The carrying amount of trademarks
years. Sustained growth of 2.0 percent has been used. Cash flow for the peri- with an indefinite useful life amounted to SEK 125.4m (113.1).

Trademarks per operating segment, SEKm 2022 2021 Goodwill per operating segment, SEKm 2022 2021
Nederman Extraction & Filtration Technology 4.5 - Nederman Extraction & Filtration Technology 793.8 467.4
Nederman Process Technology 102.2 92.0 Nederman Process Technology 394.1 342.6
Nederman Duct & Filter Technology - - Nederman Duct & Filter Technology 24.0 18.5
Nederman Monitoring & Control Technology 23.2 21.1 Nederman Monitoring & Control Technology 815.6 780.7
Total 129.9 113.1 Total 2,027.5 1,609.2

Annual growth during Annual growth after Discount rate

Goodwill the forecast period forecast period before tax
Nederman Extraction & Filtration Technology 3,0% (3,0) 3,0% (2,0) 12,24% (10,65)
Nederman Process Technology 3,0% (3,0) 3,0% (3,0) 10,53% (9,96)
Nederman Duct & Filter Technology 4,0% (3,0) 4,0% (1,0) 12,40% (10,67)
Nederman Monitoring & Control Technology 5,0% (10,0) 5,0% (8,0) 10,42% (8,85)

Sensitivity analysis Goodwill

Nederman group analysed the extent to which negative adjustments of differs between the various cash-generating units and they are sensitive to
assumptions regarding the discount rate and operating profit would result in various degrees to changes in the above assumptions. Accordingly, Nederman
the impairment of goodwill or trademarks. Sensitivity in all calculations means group continuously monitors development of the cash-generating units. The
that the goodwill value and the value in the trademarks will be justified even instability of the market with dampened profitability as a result and volatility
if the discount rate is raised by two percentage points or if long-term growth of interest rates, inflation and foreign currencies, could lead to an indication
would fall by two percentage points. Based on the analysis, there is no impair- of a need for impairment. The most important factors that affect Nederman
ment requirement for any of the cash-generating units. The factors applied in group’s future earnings trend are described in the section on operating seg-
the valuations are based on the management’s strategy, taking into consider- ments and the section on risk management.
ation historical outcomes for the various cash-generating units. The surplus

14 Tangible assets
Accounting policies

Assets owned is whether the expense refers to the replacement of components or parts
Tangible assets are recognised within the group at cost less accumulated thereof, whereby such costs will be capitalised. Even in cases where new
depreciation and any impairment. The cost includes the purchase price components are added to the asset, the expense will be added to cost.
and expenses directly attributable to the asset to bring it on site and in Any non-depreciated carrying amounts of replaced components, or parts
the condition to be used in accordance with its intended purpose. The cost of components, are disposed of and expensed in connection with replace-
of assets produced by the company includes the cost of materials, cost of ment. Repairs and maintenance are expensed on an ongoing basis.
employee benefits and, if applicable, other manufacturing costs consid-
ered directly attributable to the asset. The carrying amount of a tangible Depreciation
asset is derecognised in the balance sheet on disposal or retirement, or Depreciation takes place on a straight-line basis over the useful life of
when no future economic benefit is expected to derive from the use or the asset. The group applies component depreciation, which means that
sale/disposal of the asset. Gains or losses arising on the disposal or retire- the components’ estimated useful life forms the basis for depreciation.
ment of an asset comprise the difference between the sales price and the Estimated useful life:
asset’s carrying amount less direct selling expenses. Gains and losses are – buildings, property used in business operations 15-30 years
recognised as other operating income/expense. – plant and machinery 3-8 years
– inventories, tools and installations 3-10 years
Additional expenses – land is not depreciated
Additional expenses are only added to the cost if it is probable that the
future economic benefits associated with the asset will accrue to the com- Depreciation of components is based on each component's estimated
pany and the cost can be measured reliably. All other additional expens- useful life. The depreciation methods, residual values and useful life used
es are recognised as costs in the period in which they arise. The decisive are reviewed at each year-end.
factor for assessment of whether an additional expense is added to cost
116   CONSOLIDATED FINANCIAL STATEMENTS

14 Tangible assets, continued

Accounting policies, continued

Impairment Impairment of tangible fixed assets is charged to operating profit. Previ-

Impairment testing is carried out if any event occurs or circumstances ously recognised impairment losses are reversed if the reasons for the ear-
change that indicate that the carrying amount may have decreased. An lier impairment no longer exist. However, reversal will not be for an amount
impairment loss is recognised when an asset’s or cash-generating unit’s that is greater than that which the carrying amount would have been if the
carrying amount exceeds its recoverable amount. The recoverable amount impairment had not been recognised in previous periods.
is the higher of fair value less selling expenses and value in use. When cal-
culating the value in use, future cash flows are discounted using a discount
rate that reflects a risk-free interest rate and the risk associated with the
specific asset.

2022
Land Plant Equipment, Current
and and tools and investments and
SEKm buildings machinery fixtures advances Total
Accumulated cost
Opening balance 451.1 332.3 216.5 10.9 1,010.8
Business acquisition 0.6 15.1 8.8 0.4 24.9
Capital expenditure 4.6 8.4 17.4 42.5 72.9
Sold and scrapped -0.1 -3.2 -4.3 - -7.6
Reclassification 1.6 0.8 1.1 -6.1 -2.6
Translation differences 41.9 27.7 18.0 2.6 90.2
Closing balance 499.7 381.1 257.5 50.3 1,188.6

Accumulated depreciation and impairment

Opening balance -268.0 -250.6 -175.4 - -694.0
Business acquisition -0.3 -3.3 -5.0 - -8.6
Depreciation for the year -11.1 -16.1 -17.5 - -44.7
Sold and scrapped 0.1 3.1 4.3 - 7.5
Reclassification 0.0 -0.2 0.6 - 0.4
Translation differences -23.8 -20.4 -14.9 - -59.1
Closing balance -303.1 -287.5 -207.9 - -798.5

Carrying amounts
Opening balance 183.1 81.7 41.1 10.9 316.8
Closing balance 196.6 93.6 49.6 50.3 390.1

2021
Land Plant Equipment, Current
and and tools and investments and
SEKm buildings machinery fixtures advances Total
Accumulated cost
Opening balance 431.6 223.6 352.6 10.8 1,018.6
Business acquisition - - 0.3 - 0.3
Capital expenditure 0.7 17.9 12.1 8.5 39.2
Sold and scrapped -3.0 -3.8 -92.8 - -99.6
Reclassification - 80.0 -65.8 -9.0 5.2
Translation differences 21.8 14.6 10.1 0.6 47.1
Closing balance 451.1 332.3 216.5 10.9 1,010.8

Accumulated depreciation and impairment

Opening balance -250.1 -167.2 -302.1 - -719.4
Business acquisition - - -0.1 - -0.1
Depreciation for the year -10.0 -13.2 -14.7 - -37.9
Sold and scrapped 3.0 3.3 92.1 - 98.4
Reclassification - -63.0 57.8 - -5.2
Translation differences -10.9 -10.5 -8.4 - -29.8
Closing balance -268.0 -250.6 -175.4 - -694.0

Carrying amounts
Opening balance 181.5 56.4 50.5 10.8 299.2
Closing balance 183.1 81.7 41.1 10.9 316.8

Depreciation and impairment, SEKm 2022 2021

Depreciation is included in the following rows in the income statement:
Cost of goods sold -28.2 -24.6
Selling expenses -5.9 -4.8
Administrative expenses -10.6 -8.5
Total -44.7 -37.9
 CONSOLIDATED FINANCIAL STATEMENTS   117

15 Leasing

Accounting policies

Leasing Leases for which the underlying asset is sublet to a third party, and the
Pursuant to IFRS 16, leases are recognised in the statement of financial main lease between Nederman and the principal lessor continues to apply,
position. This recognition model is based on the view that the lessee has a are recognised as a financial asset, which comprises a receivable from a
right to use an asset for a specific period of time and at the same time has third party, and a lease liability, which comprises a liability to the principal
an obligation to pay for that right. This means that at the initial date, a right- lessor.
of-use asset that represents the right to use the underlying asset during
the lease term and a lease liability that represents the present value of The standard contains two exceptions for reporting in the statement of
future lease payments are to be recognised. Depreciation for the right-of- financial position, which Nederman applies: short-term leases (lease term
use assets and interest expenses for the lease liability are recognised in the of 12 months or less) and leases for which the underlying asset has a low
consolidated income statement and in other comprehensive income. After value (USD 5,000). These lease payments are recognised as operating
the initial date, the lease liability is remeasured so that it reflects chang- expenses in the income statement and are therefore not included in the
es in the lease payments, such as a change in the lease term or a change right-of-use asset or the lease liability. If the lease contains variable lease
in future lease payments resulting from indexation. The remeasurement expenses that are not dependent on an index or interest rate, this is also
amount is recognised as an adjustment of the right-of-use asset. recognised as an operating expense in the income statement. Any service
components in a lease are separated from the leased asset and recognised
The definitions according to IFRS 16 are applied when assessing wheth- as an operating expense in the income statement.
er a contract contains a leased asset. A right-of-use asset is defined as an
identified asset for which Nederman essentially is entitled to the economic Impairment testing of right-of-use assets
benefits arising from the use of the asset and where Nederman has the In accordance with IAS 36, impairment testing is carried out for right-of-
right to control the use of the asset. The lease term is determined on the use assets, and any identified impairment losses are recognised in oper-
basis of the non-cancellable period according to the lease. If the lease con- ating profit. Impairment testing is carried out if any event occurs or circum-
tains an extension option and there is reasonable certainty that this will be stances change that indicate that the carrying amount of the underlying
utilised, the lease term applied consists of the non-cancellable period plus asset may have decreased. An impairment loss is recognised when the
the assessed period of extension. In assessing the period of extension, carrying amount of an asset or a cash-generating unit exceeds the present
circumstances are taken into consideration such as financial incentives in value of future lease payments or of the fair value of the underlying asset
such a manner that existing lease terms are compared with estimated mar- less divestment expenses. In the calculation of the present value of future
ket rents, whether material improvements have been made to the proper- lease payments, future cash flows are discounted, primarily on the basis
ty and whether costs would arise in relation to any move to new premises. of the implicit interest rate and, otherwise, by the incremental borrowing
rate. An impairment loss is reversed if a positive change has occurred in
The discount rate primarily consists of the rate implicit in the lease if it is the present value of the lease payments or the fair value of the underlying
available according to the lease. For other leases, the discount rate is the asset.
incremental borrowing rate. The incremental borrowing rate consists of an
interest margin based on the lessee’s (subsidiary within the group) cred-
it rating and an interest rate benchmark for the specific currency and the
term of the lease asset.

Estimations and assessments

Measurement of leasing
At the start of the lease, assessments are made relative to the lease’s property contracts. Accordingly, all relevant facts and circumstances are
scope, term and the interest rate used to discount future lease expenses, evaluated that create a financial incentive to include optional periods. The
which impact the measurement of the right-of-use asset and lease liabili- importance of the underlying asset in the operations and its place, avail-
ty. An assessment is also required when establishing the term of the lease. ability of suitable alternatives, material improvements in the asset, rent
The lease term includes the non-cancellable period. If Nederman group is level during voluntary periods compared with the market price, as well
reasonably certain that it will exercise an option to extend the lease or not as earlier practice, are examples of factors included in the analysis. The
exercise an alternative to terminate the lease prematurely, this is taken lease term is determined on an individual basis. The assessments are also
into consideration when establishing the lease term. The contract contains required to determine the interest rate applied to discount future lease
a large number of different terms and conditions. Extension options and fees, if the implicit rate in the lease can be easily established or if the incre-
the possibility to terminate the contract prematurely pertain mainly to mental borrowing rate is to be used.
118   CONSOLIDATED FINANCIAL STATEMENTS

15 Leasing, continued
2022
Cars and Machinery
Land & other and
SEKm buildings vehicles equipment Total
Accumulated cost
Opening balance 290.6 65.5 18.3 374.4
Business acquisition 6.3 2.2 - 8.5
New lease contracts 31.8 18.8 0.2 50.8
Terminated lease contracts -41.5 -24.3 -1.5 -67.3
Revaluated lease contracts 3.1 1.3 - 4.4
Translation differences 22.7 4.6 0.7 28.0
Closing balance 313.0 68.1 17.7 398.8

Accumulated depreciation and impairment

Opening balance -140.2 -33.6 -8.3 -182.1
Depreciation -54.0 -21.5 -3.6 -79.1
Terminated lease contracts 38.0 24.3 1.5 63.8
Translation differences -12.3 -2.4 -0.5 -15.2
Closing balance -168.5 -33.2 -10.9 -212.6

Carrying amounts
Opening balance 150.4 31.9 10.0 192.3
Closing balance 144.5 34.9 6.8 186.2

2021
Cars and Machinery
Land & other and
SEKm buildings vehicles equipment Total
Accumulated cost
Opening balance 330.9 64.0 21.0 415.9
Business acquisition 0.5 - - 0.5
New lease contracts 38.3 21.2 1.4 60.9
Terminated lease contracts -99.6 -20.7 -4.5 -124.8
Revaluated lease contracts 4.0 0.2 - 4.2
Reclassification 1.1 -1.1 - -
Translation differences 15.4 1.9 0.4 17.7
Closing balance 290.6 65.5 18.3 374.4

Accumulated depreciation and impairment

Opening balance -160.4 -32.0 -9.1 -201.5
Depreciation -50.0 -19.2 -3.8 -73.0
Terminated lease contracts 82.4 19.0 5.5 106.9
One-time effect -3.9 -1.3 -0.7 -5.9
Reclassification -0.9 0.9 - -
Translation differences -7.4 -1.0 -0.2 -8.6
Closing balance -140.2 -33.6 -8.3 -182.1

Carrying amounts
Opening balance 170.5 32.0 11.9 214.4
Closing balance 150.4 31.9 10.0 192.3

The leased assets are pledged for the leasing liabilities. See also note 29.

Depreciation and impairment, SEKm 2022 2021

Depreciation is included in the following rows in the income statement:
Cost of goods sold -35.1 -34.0
Selling expenses -33.7 -29.8
Administrative expenses -8.4 -7.5
Research and developement expenses -1.9 -1.7
Total -79.1 -73.0

Lease expenses, SEKm 2022 2021

Depreciation of right-of-use assets -79.1 -73.0
Interest expense on lease liabilities -9.5 -11.2
Short term leases -1.5 -1.7
Lease assets of low value -3.1 -2.1
Total -93.3 -88.0

Cash flow from leasing, SEKm 2022 2021

Cash flow from leasing -89.3 -85.1
 CONSOLIDATED FINANCIAL STATEMENTS   119

16 Inventory

Accounting policies Estimations and assessments

Inventory Net realisable value

Inventory is posted at the lower of cost and net realisable value. Cost The calculation of the net realisable value is based on an estimate of
is calculated using the first-in, first-out (FIFO) method and includes future sales prices, which is impacted by several parameters, such as
expenses directly attributable to the acquisition of the inventory and market demand, product changes and price trends. Since the actual
to bring goods to their present location and condition. For finished sales prices and selling expenses are not known at the time of assess-
goods and work in progress, cost includes an appropriate share of indi- ment, the adjustment to net realisable value is conducted based on
rect expenses based on normal capacity. Net realisable value compris- estimated technical and commercial obsolescence. In assessing com-
es the estimated sales price of goods in inventory, excluding estimated mercial obsolescence, rate of turnover is a risk factor.
costs of completion and sales.

Inventory, SEKm 2022 2021

Raw materials and consumables 486.6 338.0
Work in progress 109.4 79.9
Finished goods and tradable goods 294.8 195.2
Total 890.8 613.1

Change in imparement of inventory, SEKm 2022 2021

Opening balance 136.9 110.9
Business acquisition 9.8 -
Change reported in the operating profit 19.1 24.6
Disposals -3.8 -3.4
Reclassifications -2.2 -0.7
Effect of changes in currency exchange rates 9.3 5.5
Impairment of inventory at 31 December 169.1 136.9

17 Accounts receivable

Accounting policies Estimations and assessments

Accounts receivable Provision for expected credit losses

Accounts receivable comprise financial instruments and are financial The provision for expected credit losses is based on historical credit
assets that have defined or definable payments. A financial assets is losses and on the estimates made in respect of current and future-ori-
recognised in the balance sheet when the company becomes a par- ented information on the customers’ payment capacity. The estab-
ty according to the instrument’s contract terms. When Nederman is lishment of provisions for expected credit losses is based on the esti-
entitled to unconditional compensation from the customer, this is rec- mates made of all receivables outstanding, including receivables not
ognised as a receivable. An account receivable arises when control has yet due. An individual assessment of the impairment requirement is
been transferred to the customer and the invoice has been sent. A finan- made based on the customers’ financial situation. Actual credit losses
cial asset is derecognised in the balance sheet when the contractual may deviate from expected credit losses and may thus have a material
obligation is fulfilled, expires or the company loses control over it. Finan- impact on other operating income and expenses in profit or loss. Esti-
cial assets and liabilities are offset and recognised at the net amount mates and assumptions are reviewed on a regular basis.
presented in the balance sheet when there is a legally enforceable right
to offset the amount and when the intention is to settle items on a net
basis, or to realise the asset and settle the liability simultaneously.

Accounts receivable have a short anticipated term and are measured

without discount at the nominal amount and are recognised at the
amount that is expected to be received, meaning after deductions for
expected credit losses for the remaining term. Impairment losses on
accounts receivable are recognised in other operating expenses.

2022 2021
Overdue Overdue
Accounts receivable Not number of days Not number of days
maturity structure, SEKm yet due 1-30 31-90 >90 Total yet due 1-30 31-90 >90 Total
Accounts receivable, gross 536.5 156.2 83.5 80.2 856.4 435.1 112.7 57.3 44.4 649.5
Expected credit losses -1.7 - -0.4 -39.5 -41.6 -1.7 -1.5 -0.7 -22.6 -26.5
Accounts receivable, net 534.8 156.4 83.1 40.7 814.8 433.4 111.2 56.6 21.8 623.0
Credit loss level 0.3% - 0.5% 49.3% 4.9% 0.4% 1.3% 1.2% 50.9% 4.1%

Change in credit loss provision 2022 2021

Opening balance -26.5 -25.7
Business acquisition -1.3 -
Provisions for uncertain receivables -19.9 -2.4
Receivables written off and not recoverable 3.8 1.5
Reversed provisions 4.7 1.4
Translation differences -2.4 -1.3
Closing balance -41.6 -26.5
120   CONSOLIDATED FINANCIAL STATEMENTS

18 Other receivables

Accounting policies Long-term receivables

which are fixed asses, SEKm 2022 2021
Other receivables Capital insurance related to pension plans 2.8 2.8
Other receivables, excluding VAT receivables, are financial assets that Other receivables 1.4 2.8
have defined or definable payments and that are not listed on an active Total 4.2 5.6
market. These assets are measured at amortised cost. Amortised cost
is determined according to the effective interest rate and calculated as
of the acquisition date.
Other receivables which are current assets,
SEKm 2022 2021
VAT receivables 48.0 34.0
Other receivables 62.7 48.4
Total 110.7 82.4

Information about the group's financial assets recognised as carrying

amounts or as fair value, see note 26, Financial instruments.

19 Prepaid expenses and accrued income

SEKm 2022 2021

Rent/leasing 6.6 6.3
Computer/license costs 19.8 15.9
Insurance 6.8 2.7
Bank costs 0.1 0.5
Other 59.8 20.0
Total 93.1 45.4

20 Equity and number of shares

Accounting policies

Earnings per share the addition of the average number of shares that would be issued as an
Earnings per share before dilution are calculated based on the earnings for effect of the ongoing share-related remuneration programme.
the period in the group attributable to the parent company’s sharehold-
ers in relation to the average number of shares outstanding during the Dividends
financial year. Earnings per share after dilution are calculated based on the Dividends are recognised as a liability after the Annual General Meeting has
earnings for the period in the group attributable to the parent company’s approved the dividend payment.
shareholders in relation to the average number of shares outstanding with

Number of shares 2022 2021

Issued number of shares as of 31 December 35,146,020 35,146,020
Weighted average number of shares prior to dilution 35,093,096 35,093,096
Weighted average number of shares after dilution 35,093,096 35,093,096

Registered share capital is SEK 1,171,534 (1,171,534). The par value of the shares is SEK 0.03.

Number of treasury shares held 2022 2021

Opening number of treasury shares held 52,924 52,924
Closing number of treasury shares held 52,924 52,924

Information about the group's share-related incentive plan see note 8, Employees.

Earnings per share, SEK 2022 2021

Year’s earnings attributable to the parent company’s shareholders 328.7 305.3
Earnings per share before dilution 9.37 8.70
Earnings per share after dilution 9.37 8.70
 CONSOLIDATED FINANCIAL STATEMENTS   121

20 Equity and number of shares, continued

Dividend
The Board of Directors proposes a dividend of SEK 3.75 (3.50) per share, a total of SEK 131.6m (122.8). The dividend amount is based on the number of shares out-
standing at 31 December 2022, which could be changed as treasury shares could be converted by the record date of 14 April 2023. The dividend will be adopted by
the Annual General Meeting on 24 April 2023.

The group seeks to pay an ordinary dividend each year amounting to 30-50 percent of net profit for the year. The Board of Directors has proposed a dividend of SEK
3.75 per share to the 2023 Annual General Meeting, corresponding to 6.0 percent of equity. During the past five years, the ordinary dividend has amounted to an
average of 4.5 percent of equity. This means that 30 percent of earnings per share has been distributed in the form of ordinary dividends.

Capital manageent
According to the Board’s policy, the group’s financial objective is to achieve a good capital structure and financial stability in order to maintain the trust
of investors, creditors and the market, and to form a good base for continued development of the business, while the long-term return generated for
shareholders remains satisfactory.

Capital defined as total equity, SEKm 2022 2021

Total equity 2,186.5 1,717.4

Net debt/equity ratio 2022 2021

Interest-bearing liabilities and pension provisions 2,198.3 1,609.4
Cash and cash equivalents -721.2 -541.6
Net debt 1,477.1 1,067.8

Net debt/equity ratio 67.6% 62.2%

The net debt/equity ratio increased compared with the preceding year, which Equity was strengthened during the year as a consequence of favourable prof-
is a result of the fact that net debt increased more in relation to equity. The itability. In addition, equity was impacted by the weakened SEK, which led to
higher level of net debt was primarily due to additional borrowing of SEK 606m. the translation reserve, attributable to the translation of foreign subsidiaries,
The weakened SEK also led to a translation effect on foreign currency loans, amounting to SEK 236m.
increasing net debt by SEK 24m. In comparison with the preceding year, the
pension liability decreased by SEK 32m, which was primarily a consequence A favourable net debt/equity ratio and ample access to cash and cash equiva-
of an increase in the discount rate. The lease liability was in line with the pre- lents provides an opportunity to take advantage of the growth prospects antic-
ceding year. The cash balance continued to strengthen due to healthy orders ipated in the coming years, while the dividend policy is expected to be main-
received, with advance payments received as a result. tained. For the same reason, issues of new shares will probably not be needed
in the coming years, except in the event of major corporate acquisitions.

21 Interest-bearing liabilities

Accounting policies
Long-term liabilities, SEKm 2022 2021

Drawn down loans comprise a financial liability and are measured Bank loans 1,931.9 1,304.6
at amortised cost. Loans are initially recognised at the loan amount Lease liabilities 122.0 133.1
received after deductions for transaction costs. After the acquisition Total 2,053.9 1,437.7
date, loans are measured at amortised cost using the effective interest
method. Current liabilities, SEKm 2022 2021
Current part of lease liabilities 73.9 69.5
Total 73.9 69.5
For more information about the company’s exposure to interest rate risks and
currency risks, see note 3, Goal and policy regarding financial risk. Total interest-bearing liabilities 2,127.8 1,507.2

As of 31 December 2022, the group had pension provisions of SEK 70.5m

(102.2) as recognised in note 24.
122   CONSOLIDATED FINANCIAL STATEMENTS

21 Interest-bearing liabilities, continued

Terms and repayment due dates
For terms and due dates for repayment, see the table below. As of 2022, the loans are presented organised by currency and loan type. Comparative data
were adjusted in a corresponding manner. No security for the bank loans has been provided.

Nominal amount
Nominal in original Recorded
2022, SEKm Currency Due date interest currency amount
Bank loan* (revolving) SEK 2027-03-24 2,84%-3,43% 926.5 923.7
Bank loan* (revolving) USD 2027-03-24 4,87%-5,11% 49.0 509.8
Bank loan* (term loan) SEK 2027-03-29 2,89%-3,07% 500.0 498.4
Lease liabilities 195.9
Total interest bearing liabilities 2,127.8
* Sustainability linked loans

Nominal amount
Nominal in original Recorded
2021, SEKm Currency Due date interest currency amount
Bank loan (revolving) SEK 2023-05-24 0.700% 926.5 924.2
Bank loan (revolving) USD 2023-05-24 0.980% 9.0 81.2
Bank loan (term loan) SEK 2023-05-24 0.700% 300.0 299.2
Lease liabilities 202.6
Total interest bearing liabilities 1,507.2

22 Other liabilities
Other long-term liabilities, SEKm 2022 2021
Deferred payment of acquisition price upon business acquisition (see note 4) 23.4 18.3
Other liabilities 4.6 5.3
Total 28.0 23.6

Other short-term liabilities, SEKm 2022 2021

Deferred payment of acquisition price upon business acquisition (see note 4) 5.0 -
Personnel-related liabilities 49.9 57.4
VAT payable 45.7 43.8
Other liabilities 36.9 14.0
Total 137.5 115.2

For information about the group's financial liabilities recognised as carrying amounts or as fair value, see note 26, Financial instruments.

23 Accrued Expenses and Prepaid Income

SEKm 2022 2021
Personnel-related expenses 185.8 162.0
Interest expenses 0.0 0.2
Audit expenses 5.3 5.9
Sales expenses 9.9 6.8
Freight and customs expenses 0.6 1.3
Other 66.9 44.7
Total 268.5 220.9
 CONSOLIDATED FINANCIAL STATEMENTS   123

24 Provisions for pensions and similar obligations

Accounting policies

Defined-contribution pension plans ent value. The discount rate is the interest rate at the balance sheet date
Defined-contribution pension plans are plans where the company’s obli- on first-class corporate bonds, including mortgage bonds, with a maturity
gation is limited to the contributions the company has undertaken to pay. corresponding to the group’s pension obligations. When there is not a via-
The size of the employee’s pension depends on the contributions paid ble market for such corporate bonds, the market rate of interest for gov-
by the company and the return on capital that the contributions provide. ernment bonds with a similar maturity is used instead. The calculation is
The group’s obligations for defined-contribution plans are recognised as performed by a qualified actuary using the projected unit credit method.
expenses in the income statement as they are earned. The group’s net liability is the present value of the liability less the fair val-
ue of the plan assets, adjusted for any asset restrictions. The net interest
In Sweden, the group has defined-contribution pension plans paid in full by expense/income of the defined-benefit liability/asset is recognised in the
the companies. Outside of Sweden, there are defined-contribution plans, income statement under net financial items. The net interest income/
which are paid for partly by the subsidiaries, and partly by payment from expense is based on the interest generated by discounting the net liability,
the employees. Payments into these plans are continual in accordance meaning the interest on the liability, the plan assets and the interest on the
with the rules for each plan. effect of any asset restrictions. Other components are recognised in oper-
ating income. Revaluations are made of changes in the obligations’ present
In addition to obligations for old-age pensions, the ITP plan also comprises value due to changed actuarial assumptions and experience-based adjust-
a collective family pension for salaried employees in Sweden, which is safe- ments. The revaluations are recognised in other comprehensive income.
guarded via insurance in Alecta. According to a statement from the Swed- Changes to or curtailment of a defined-benefit plan are recognised on the
ish Financial Accounting Standards Council, this is a defined-benefit plan earliest of the following dates: a) when the change in the plan or reduction
that covers multiple employers. For the financial year 2022, Nederman occurs, or b) when the company recognises related restructuring costs and
group has not had access to information from Alecta that makes it possible redundancy payments. The changes/reductions are recognised immedi-
to report this plan as a defined-benefit plan. Accordingly, the plan was rec- ately in net profit for the year. This special employer’s contribution is part
ognised as a defined-contribution plan. The annual charges for retirement of the actuarial assumptions and is recognised as part of the net liability/
annuities covered by Alecta amount to SEK 6.5m (6.8). Nederman group asset. The part of the special employer’s contribution that is calculated
anticipates paying approximately SEK 5m in premiums to Alecta during based on the Swedish Pension Obligations Vesting Act in the legal entity is
2023. The collective consolidation level measures distributable assets in recognised for reasons of simplification as an accrued expense rather than
relation the insurance obligation. According to Alecta’s consolidation policy as part of the net liability/asset. Tax on the return on pension funds is rec-
for defined-benefit insurance, the collective consolidation level is usual- ognised in profit for the period to which the tax relates, and is therefore not
ly permitted to vary between 125 percent and 175 percent. At the end of included in the debt calculation. For funded plans, the tax is charged to the
2022, Alecta’s surpluses, in the form of the collective consolidation level, return on plan assets and is recognised in other comprehensive income.
amounted to 172 percent (172). If the consolidation level is less than or For unfunded or partially unfunded plans, the tax is charged to net profit
exceeds the normal range, one action may be to raise the agreed price for for the year. When there is a difference between how pension costs are
new subscription or to introduce premium reductions. The group's share determined in a legal entity and a group, a provision or receivable is rec-
of total savings premiums for ITP in Alecta amounted to 0.029 percent ognised for the special employer’s contribution based on this difference.
(0.027) and the group's share of the total number of active insured individ- The provision or receivable is not discounted.
uals amounts to 0.026 percent (0.025).
The group has defined-benefit plans that pay remuneration in the form
Defined-benefit pension plans of old-age pensions and remuneration for healthcare costs to employees
Defined-benefit plans are plans for post-employment benefits other when they retire in Poland, Switzerland, Sweden, Thailand, Germany and
than defined-contribution plans. The group’s net liability in respect of the US. Costs for service during the current period are posted directly to the
defined-benefit plans is calculated separately for each plan by estimating income statement. However, most are closed obligations where no addi-
the future benefits that employees have earned through their employ- tional benefits are earned.
ment in both current and prior periods; this benefit is discounted to its pres-

Estimations and assessments

Assumptions in calculation of pensions and similar obligations

Provisions and costs for post-employment remuneration, primarily pen- defined-benefit obligations if material assumptions are changed. There
sions, depend on the actuarial assumptions. Special assumptions and actu- are also other assumptions, such as pace of salary increases, termination
arial calculations are conducted for each defined-benefit plan. The most intensity, mortality, cost trends for healthcare, and other factors. Actuarial
significant assumptions pertain to the discount rate and inflation. Inflation assumptions are reviewed annually or more frequently if there are indi-
assumptions are based on analyses of external market indicators. A sensi- cations of material changes. The calculations are performed by qualified
tivity analysis that is presented in the relevant note shows the effect of the actuaries.
124   CONSOLIDATED FINANCIAL STATEMENTS

24 Provisions for pensions and similar obligations, continued

Defined-contribution plans
SEKm 2022 2021
Costs for defined-contribution pension plans -66.3 -54.3

Defined-benefit pension plans

Defined-benefit net liability, reported in statement of financial position, SEKm 2022 2021
Defined benefit obligation 268.8 374.7
Fair value of plan asset (after deduction of asset ceiling) 198.3 272.5
Deficit(+) / Surplus(-) 70.5 102.2
Whereof plans with net surplus 9.8 -

Present value of entirely or partially funded obligations 188.5 272.7

Present value of unfunded obligations 80.3 102
Total present value of defined-benefit obligations 268.8 374.7
Fair value of plan assets -198.3 -272.5
Net liability 70.5 102.2

Change in present value of defined-benefit obligations, SEKm 2022 2021

Obligations for defined benefit plans, 1 January 374.7 435.5
Discontinuation of defined-benefit obligations - -67.2
Payment of pension benefits -72.7 -29.3
Cost of service in current period 6.5 9.3
Contribution and payments from plan participants 3.6 3.2
Interest cost 1.9 1.9
Revaluations
- Actuarial gains (-) and losses (+) for the revised demographic assumptions -11.7 -13.4
- Actuarial gains (-) and losses (+) for changes in financial assumptions -60.5 -1.3
- Experience-based gains (-) / losses (+) -8.9 15.3
Translation differences 35.9 20.7
Obligations for defined benefit plans, 31 December 268.8 374.7

Changes in fair value of defined-benefit plan assets, SEKm 2022 2021

Fair value of plan assets, 1 January 272.5 284.4
Discontinuation of defined-benefit plan - -38.2
Payments to plans 3.7 8.2
Fees from participants included in the plan 3.6 3
Benefit payments from plan -68.8 -23.1
Interest income on plan assets 0.7 0.7
Return on plan assets, excluding interest income -17.1 19.6
Translation differences 34.4 17.9
Fair value of plan assets, 31 December 229.0 272.5

Income and costs reported in profit for the year, SEKm 2022 2021
Costs for service in current period -6.5 -9.3
Net interest -1.2 -1.2
Effect of discontinuation of defined-benefit pension plan - 29.0
Total net income/costs in the income statement -7.7 18.5

of which, amounts affecting operating profit -6.5 19.7

of which, amounts affecting financial costs -1.2 -1.2
Total net costs -7.7 18.5

Income and costs recognised in other comprehensive income, SEKm 2022 2021
Revaluations of pension commitments 81.1 -0.6
Return on plan assets -17.1 19.6
Effect of changes in asset ceiling -28.7 -
Revaluation of defined-benefit net liabilities in other comprehensive income 35.3 19.0
Translation differences on foreign plans -5.6 -3.5

Assumptions for defined- Sensitivity analysis

benefit obligations, % Switzerland Sweden Germany The following table presents possible changes in actuarial assumptions on
Discount rate at 31 December 2.3% (0.3) 3.6% (1.4) 3.5% (1.1) the closing date, with the other assumptions unchanged, and how these
Future pension increases 1.5% (0,3) 2.0% (2.2) 2.0% (1.5) would impact on the defined-benefit obligation.

SEKm +0,50% -0,50%

Aggregation of assets 2022 2021 Discount rate -13.2 14.7
Equity instruments 65.6 89.3 Future increase in pension costs 13.4 -8.2
Real estate 61.8 65.6
Cash and cash equivalents 9.3 14.8 Future cash flow
Debt instruments 47.4 58.3 As of 31 December 2022, the weighted average duration of commitments
Other 44.9 44.5 was 13.4 years (15.3). Expected payments in 2023 for defined-benefit
Total 229.0 272.5 pension plans amount to SEK 21.5m.
 CONSOLIDATED FINANCIAL STATEMENTS   125

25 Other provisions
Accounting policies

Provisions No provision is made for future operating expenses. Restructuring costs

Provisions are recognised in the balance sheet when the group has a legal are recognised as a separate item in the income statement when these
or informal obligation as a result of a past event, and it is probable that an are attributable to a significant change in the group structure. Restruc-
outflow of financial resources will be required to settle the obligation, and turing costs are otherwise recognised as an element of other operating
when the amount can be estimated reliably. If these criteria cannot be met, expenses.
contingent liabilities may be recognised. Provisions are reviewed at each
balance sheet date. Provisions are divided into long-term and short-term Warranty commitments
provisions. Warranties are provided for sales depending on the nature and use of the
product. Warranty conditions provided ensure that the product or solution
Costs for restructuring and redundancy payments concerned will function as the parties intended and that it meets agreed
A provision for adopted restructuring measures is recognised when the specifications. No warranties are sold separately and no warranties are
group has approved a detailed and formal restructuring plan, and the provided to the customer as a separate service. On the basis of what the
restructuring has either begun or been publicly announced. Provisions warranty covers and with requirements as to how the product is to be
for restructuring often include termination benefits, which can be either used/maintained, none of the warranties given are regarded as separate
voluntary or involuntary. Termination benefits are recognised according to performance obligations in accordance with IFRS 15 Revenue, and are
the same principles as provisions for restructuring, except in cases where instead recognised in accordance with IAS 37 Provisions. A provision for
there are requirements to work during the notice period. The cost of this product warranties is recognised as an expense when the underlying prod-
work is allocated over the period in which the services were performed. ucts or services are sold.

Estimations and assessments

Provisions for product guarantees

Provisions for product guarantees are based on estimations based on his- guarantees may deviate from the anticipated outcome and have a material
torical experience and assumptions deemed reasonable under the prevail- impact on recognised guarantee costs and provisions during future peri-
ing circumstances for the individual case. The actual outcome of product ods of time. Estimates and assumptions are reviewed on a regular basis.

Restructuring /severance pay, SEKm 2022 2021 Provisions included in long-term liabilities, SEKm 2022 2021
Reported value, opening balance 10.6 22.8 Restructuring /severance pay - 0.1
Provisions during the period 0.7 0.3 Warranty commitments 19.8 14.1
Amount used during the period -3.7 -12.4 Other 8.5 5.0
Translation differences -0.1 -0.1 Total 28.3 19.2
Total 7.5 10.6
Provisions included in current liabilities, SEKm 2022 2021
Warranty commitments, SEKm 2022 2021 Restructuring /severance pay 7.5 10.5
Reported value, opening balance 33.8 29.9 Warranty commitments 27.3 19.7
Provisions during the period 19.4 9.9 Loss contracts 0.3 2.7
Utilised during the period -7.8 -5.9 Other 8.0 8.1
Business acquisition 5.4 - Total 43.1 41.0
Reclassification -1.0 0.8
Unutilised amount reversed during the period -5.6 -3.1 Total provisions, SEKm 2022 2021
Translation differences 2.9 2.2 Reported value, opening balance 60.2 68.4
Total 47.1 33.8 Provisions during the period 32.8 19.0
Utilised during the period -17.1 -21.9
Loss contracts, SEKm 2022 2021 Business acquisition 5.4 -
Reported value, opening balance 2.7 2.9 Reclassification -1.0 -0.3
Utilised during the period -0.5 - Unutilised amount reversed during the period -12.1 -5.9
Unutilised amount reversed during the period -1.9 - Translation differences 3.2 0.9
Translation differences 0.0 -0.2 Total 71.4 60.2
Total 0.3 2.7

Other, SEKm 2022 2021

Reported value, opening balance 13.1 12.8
Provisions during the period 12.7 8.8
Utilised during the period -5.1 -3.6
Reclassification - -1.1
Unutilised amount reversed during the period -4.6 -2.8
Translation differences 0.4 -1.0
Total 16.5 13.1
126   CONSOLIDATED FINANCIAL STATEMENTS

26 Financial instruments
Accounting policies

Financial instruments Financial assets and liabilities are measured at fair value via the
Financial instruments recognised in the balance sheet include, on the asset income statement
side, cash and cash equivalents, accounts receivable, contract assets, Financial assets and liabilities in this category are measured on an ongo-
derivative assets and other receivables. The liability side includes borrow- ing basis at fair value, with changes in fair value recognised in the income
ings, lease liabilities, accounts payable, contract liabilities, derivative liabil- statement. Conditional earn-out payments in acquisitions are measeured
ities and other liabilities. Financial assets or liabilities are recognised in the at fair value with changes in fair value recognised in the income statement.
balance sheet when the company becomes a party according to the instru- Derivatives that are not used for hedge accounting are also measured on
ment’s contract terms. Accounts receivable are recognised in the balance an ongoing basis at fair value, with changes in fair value recognised in the
sheet when control has been transferred to the customer and the invoice income statement. Derivative trading is carried out to hedge the group’s
has been sent. Liabilities are recognised when the counterparty has per- currency risks. Derivatives with positive values (unrealised gains) are rec-
formed and a contractual obligation to pay exists, even if the invoice has ognised as other non-current or current receivables. Changes in fair value
not yet been received. Accounts payable are recognised when the invoice in regard to derivatives where the underlying transactions relate to opera-
has been received. A financial asset is derecognised in the balance sheet tions are recognised as other operating income/other operating expenses
when the contractual obligation is fulfilled, expires or the company loses in the income statement. Changes in the fair value of derivatives where the
control over it. The same applies to part of a financial asset. A financial lia- underlying transactions are financial are recognised in net financial items.
bility is derecognised in the balance sheet when the obligation specified in
the contract is discharged or otherwise expires. The same applies to part of The carrying amount and fair value of these instruments can be found in
a financial liability. Financial assets and liabilities are offset and recognised the following tables. The measurement at fair value for such assets has
at the net amount presented in the balance sheet when there is a legally been based on market terms using observable market data which are not
enforceable right to offset the amount and when the intention is to settle quoted in an active market (level 2).
items on a net basis, or to realise the asset and settle the liability simulta-
neously. Acquisitions and divestments of financial assets are recognised Cash and cash equivalents
on the transaction date, which is the date that the company undertakes to Cash and cash equivalents consist of cash and immediately available bal-
acquire or divest the asset. ances with banks and similar institutions.

A financial instrument is classified based on the purpose of the acquisition. Hedge accounting
A financial asset’s classification determines how it is measured after initial If the criteria for hedge accounting, in respect of cash flow hedging, are
recognition. Financial instruments that are not derivatives are initially rec- met, the effective part of the change in the fair value of the derivative is
ognised at cost, corresponding to the instrument’s fair value plus transac- recognised in other comprehensive income and accumulated in the hedg-
tion costs. Accounts receivable and accounts payable have a short expect- ing reserve in equity. The cumulative gains or losses recognised in the
ed maturity and are measured at a nominal amount. hedging reserve are reversed to earnings in the same period as the hedged
cash flow affects earnings. Any ineffective portion of the change in value
Financial assets and liabilities measured at amortised cost is recognised directly in earnings. If the hedging relationship is interrupted
The majority of the group’s financial instruments consist of accounts and cash flow is still expected to occur, the accumulated change in value
receivable, contract assets, cash and cash equivalents, other receivables, is recognised in the hedging reserve until the cash flow attributable to
interest-bearing loans, lease liabilities, accounts payable, contract liabil- the hedged item affects earnings. In cases where the forecast cash flow
ities and other liabilities, which are measured at amortised cost in accor- underlying the hedging transaction is no longer expected to occur, the
dance with the effective interest method. For these categories of financial cumulative change in value recognised in the hedging reserve is trans-
instruments, amortised cost is consistent with fair value. ferred directly to the income statement. During 2022, no hedge account-
ing was applied.
Accounts receivable and other receivables are financial assets that have
defined or definable payments and that are not listed on an active mar- Netting agreements and similar agreements
ket. Accounts receivable are recognised at the amount that is expected The group is included in derivative contracts under the International Swaps
to be received, meaning after deductions for expected credit losses for and Derivatives Association (ISDA) master netting agreements. The agree-
the remaining term. See note 17, Accounts receivable. Loans and other ments mean that when a counterparty is unable to settle its obligations
financial liabilities are initially recognised at the loan amount received after under all transactions, the agreement is broken and all outstanding bal-
deductions for transaction costs. After the acquisition date, loans are mea- ances are to be settled in a net amount. ISDA agreements do not meet the
sured at amortised cost using the effective interest method. criteria for offsetting in the statement of financial position. This is because
off-setting under ISDA agreements is only permitted if the other party or
group cannot settle their obligations. Moreover, it is not the counterparty’s
or the group’s intention to settle transactions on a net basis, or at the same
time. The group’s currency derivatives are covered by legally enforceable
framework agreements for netting or a similar agreement.
 CONSOLIDATED FINANCIAL STATEMENTS   127

26 Financial instruments, continued

2022 2021
Fair value Fair value Fair value Fair value
Carrying amounts and via via other via via other
fair values for financial the income comprehen- Amortised the income comprehen- Amortised
instruments, SEKm Note statement sive income cost Total statement sive income cost Total
Financial assets
Accounts receivable 17 - - 814.8 814.8 - - 623.0 623.0
Contract assets 6 - - 165.3 165.3 - - 126.8 126.8
Other current receivables 18 - - 62.7 62.7 - - 48.4 175.2
Cash and cash equivalents 31 - - 721.2 721.2 - - 541.6 541.6
Total - - 1,764.0 1,764.0 - - 1,339.8 1,339.8

Financial liabilities
Bank loans 21 - - 1,931.9 1,931.9 - - 1,304.6 1,304.6
Other long-term liabilities 22 23.4 - 4.6 28.0 18.3 - 5.3 23.6
Lease liabilities 21 - - 195.9 195.9 - - 202.6 202.6
Accounts payable - - 498.2 498.2 - - 411.9 411.9
Contract liabilities 6 - - 615.3 615.3 - - 404.2 404.2
Other current liabilities 22, 23 5.0 - 355.3 360.3 - - 292.3 292.3
Total 28.4 - 3,601.2 3,629.6 18.3 - 2,620.9 2,639.2

The carrying amount of financial assets and liabilities are considered a good approximation of fair value. Bank loans are subject to variable interest, of which
fair value corresponds to the carrying amount.

27 Government grants 28 Financial reporting in hyperinflationary

economies
Accounting policies

Government grants are financial contributions from government and The Nederman group has subsidiaries in Turkey where the functional currency
supranational bodies and are received in exchange for the Nederman is Turkish Lira, which as of the second quarter of 2022 is classified as a hyper-
group meeting certain established conditions. Contributions attribut- inflationary currency. This means that assets and liabilities, including goodwill
able to assets are recognised in the balance sheet, either as prepaid and other consolidated surplus values and deficits, in Turkish Lira must be
income or as a reduction in the attributable assets’ carrying amounts. adjusted for inflation in order to reflect changes in purchasing power. Inflation
Contributions that are attributable to earnings are recognised as pre- and its effect on the group is monitored and assessed continually.
paid income in the balance sheet and reduce costs in the period to
which the grant pertains. If costs arise before the contributions have Pursuant to IAS 29, Nederman’s subsidiary in Turkey was recognised after
been received, but an agreement has been finalised for receipt of the remeasurement for hyperinflation in the Group’s financial statements. Assets
contributions, the contributions are recognised in the income state- and liabilities in Turkish Lira are based on cost. The index used for remeasure-
ment to meet the costs to which the grant pertains. ment of the financial statements is the consumer price index (CPI), which
increased by 64 percent during the year. At the balance sheet date, the SEK-
TRY exchange rate was 0.56.
In 2022, government grants amounting to SEK 0.6m (5.7) were received and
were recognised in the income statement. Government grants were mainly Monetary net profit was recognised in net financial items in the consolidated
received from government bodies in Europe and Asia and primarily pertain to income statement and amounted to SEK 0.2m.
assistance for short-time work relating to Covid-19.

29 Pledged assets and contingent liabilities

Accounting policies
Pledged assets , SEKm 2022 2021
Contingent liabilities Assets with ownership restrictions 398.8 374.4
A contingent liability is recognised when there is a possible liability that (right-of-use assets, see note 15)
arises from past events, that is not recognised as a liability or provision Total 398.8 374.4
because it is not probable that an outflow of resources will be required
or that an adequately reliable estimate of the amount cannot be made. Contingent liabilities, SEKm 2022 2021
FPG/PRI 0.7 0.7
Warranty commitments Warranty commitments 105.1 65.1
Warranty commitments pertain to bank guarantees and mean that the Total 105.8 65.8
company has an obligation to compensate the owner of a debt instru-
ment for losses that the owner may incur because a specified debtor
fails to make payment when due under the contract terms. Financial
guarantee agreements are recognised as a provision in the balance
sheet when the company has a commitment for which payment will
probably be required in order to settle the obligation.
128   CONSOLIDATED FINANCIAL STATEMENTS

30 Related party transactions

No member of the Board of Directors or senior executives have or have had any executives. Transactions with the Board of Directors or Group management
direct or indirect participation in any business transaction with group compa- comprise remuneration and are presented in note 8, Employees.
nies which is or was of an exceptional character with regard to terms and condi-
tions that occurred during the year or in any previous financial year. Nor has any Transactions between Nederman Holding AB and its subsidiaries were elim-
group company provided any loan, given any guarantees or entered into any inated in the group and are not reported in this note. For Nederman’s Group
surety relationships for any of the members of the Board of Directors or senior structure, see the parent company’s note 13, Shares and participations.

31 Cash flow
Accounting policies

Cash flow statement rates. Changes in group structure, acquisitions and divestments are rec-
The cash flow statement was prepared according to with the indirect ognised net, excluding cash and cash equivalents, and are included in cash
method. Foreign group companies’ cash flows are restated at average flow from investing activities under acquisition of subsidiaries/businesses.

Liquid funds, SEKm 2022 2021

Subcomponents of cash and cash equivalents:
Cash and cash equivalents 721.2 541.6
Total according to statement of financial position 721.2 541.6

Adjustments for items not included in cash flow, SEKm 2022 2021
Capital gain on sale of tangible assets -0.4 0.2
Capital gain/loss on terminated lease contracts before the end date -0.4 -4.6
Provisions 1.5 -9.2
Discontinuation of defined-benefit pension plan (see note 24) - -29.0
Total 0.7 -42.6

Unused credits, SEKm 2022 2021

Disposable funds 1,391.7 1,339.4

Financial activities
The below table shows changes in liabilities included in financial activities.

Items not affecting cash flow

Amount at Changes Exchange Change in
beginning of impacting Business Interest & rate gains/ lease Amount at
2022, SEKm the year cash flow acquisition fees losses liabilities year end
Long-term interest-bearing liabilities - bank loans 1,304.6 605.6 - -2.7 24.4 - 1,931.9
Lease liabilities 202.6 -80.1 8.5 - 13.7 51.2 195.9
Total 525.5

Items not affecting cash flow

Amount at Changes Exchange Change in
beginning of impacting Business Interest & rate gains/ lease Amount at
2021, SEKm the year cash flow acquisition fees losses liabilities year end
Long-term interest-bearing liabilities - bank loans 1,536.7 -247.7 - 1.8 13.8 - 1,304.6
Lease liabilities 229.5 -74.0 0.5 - 9.5 37.1 202.6
Total -321.7
 CONSOLIDATED FINANCIAL STATEMENTS   129

32 Alternative performance measures

In addition to information on our reported IFRS results, we provide certain isolation or as substitutes to the equivalent IFRS measures, but should be used
information on an underlying business performance basis. We believe that in conjunction with the most directly comparable IFRS measures in the report-
our underlying business performance measures provide meaningful supple- ed results. This is a consistent application compared with earlier periods. See
mental information to both management, investors and other stakeholders. page 148 for definitions.
These underlying business performance measures should not be viewed in

SEKm 2022 2021 SEKm 2022 2021

Operating profit 480.2 458.9 Equity - opening balance 1,717.4 1,300.8
Acquisition costs 8.4 1.3 Equity - closing balance 2,186.5 1,717.4
Discontinuation of defined-benefit pension plan - -29.0 Equity - average 1,952.0 1,509.1
Adjusted operating profit 488.6 431.2 Net profit/loss for the period 328.7 305.3
Return on equity 16.8% 20.2%
Adjusted operating profit 488.6 431.2
Net sales 5,178.9 4,041.8 Equity - average 1,952.0 1,509.1
Adjusted operating margin 9.4% 10.7% Net Debt - opening balance 1,067.8 1,450.5
Net Debt - closing balance 1,477.1 1,067.8
Operating profit 480.2 458.9 Net debt - average 1,272.5 1,259.2
Amortisation intangible assets 78.0 63.4 Operating capital - average 3,224.5 2,768.3
EBITA 558.2 522.3 Adjusted operating profit 488.6 431.2
Return on capital 15.2% 15.6%
EBITA 558.2 522.3
Acquisition costs 8.4 1.3 Net sales 5,178.9 4,041.8
Discontinuation of defined-benefit pension plan - -29.0 Operating capital - average 3,224.5 2,768.3
Adjusted EBITA 566.6 494.6 Capital turnover rate, multiple 1.6 1.5

Adjusted EBITA 566.6 494.6 Net debt 1,477.1 1,067.8

Net sales 5,178.9 4,041.8 Adjusted EBITDA 690.4 605.5
Adjusted EBITA margin 10.9% 12.2% Net debt/Adjusted EBITDA, multiple 2.1 1.8

Operating profit 480.2 458.9 Adjusted EBITDA 690.4 605.5

Depreciation 201.8 174.3 Net financial items -41.4 -41.8
EBITDA 682.0 633.2 Adjusted EBITDA/net financial items, multiple 16.7 14.5

EBITDA 682.0 633.2 Profit before tax 438.8 417.1

Acquisition costs 8.4 1.3 Financial expenses 64.4 45.2
Discontinuation of defined-benefit pension plan - -29.0 Acquisition costs 8.4 1.3
Adjusted EBITDA 690.4 605.5 Discontinuation of defined-benefit pension plan - -29.0
Adjusted profit before tax excluding 511.6 434.6
Adjusted EBITDA 690.4 605.5 financial expenses
Net sales 5,178.9 4,041.8 Financial expenses 64.4 45.2
Adjusted EBITDA margin 13.3% 15.0% Interest cover ratio, multiple 7.9 9.6

Equity - closing balance 2,186.5 1,717.4 Incoming orders, same period in previous year 4,622.9 3,480.2
Balance sheet total 6,220.1 4,729.0 Change in incoming orders, organic 218.2 1,352.8
Equity/asset ratio 35.2% 36.3% Change in incoming orders, currency effects 382.9 -211.2
Change in incoming orders, acquisitions 200.8 1.1
Cash and cash equivalents 721.2 541.6 Incoming orders 5,424.8 4,622.9
Long-term interest-bearing liabilities 1,931.9 1,304.6
Long-term lease liabilities 122.0 133.1 Order growth, organic 4.8% 38.9%
Pension liabilities 70.5 102.2 Order growth, currency effects 8.2% -6.1%
Current lease liabilites 73.9 69.5 Order growth, acquisitions 4.3% 0.0%
Net debt 1,477.1 1,067.8 Order growth 17.3% 32.8%

Net debt 1,477.1 1,067.8 Net sales, comperative period previous year 4,041.8 3,674.8
Equity - closing balance 2,186.5 1,717.4 Change in net sales, organic 555.0 547.5
Net debt/ equity ratio 67.6% 62.2% Change in net sales, currency effects 388.2 -181.5
Change in net sales, acquisitions 193.9 1.0
Net debt 1,477.1 1,067.8 Net sales 5,178.9 4,041.8
Equity - closing balance 2,186.5 1,717.4
Operating capital 3,663.6 2,785.2 Sales growth, organic 13.7% 14.9%
Sales growth, currency effects 9.6% -4.9%
Sales growth, acquisitions 4.8% 0.0%
Sales growth 28.1% 10.0%

33 Events after the end of the reporting period

No significant events occurred after the balance sheet date.
130 PARENT COMPANY’S STATEMENT

Parent company’s statement

 PARENT COMPANY’S STATEMENT   131

Income statement for the Parent company

1 January - 31 December
SEKm Note 2022 2021
Net sales 2, 19 19.4 26.4
Administrative expenses 4, 5, 6, 7 -162.3 -140.7
Reseach and developement expenses -0.1 -0.4
Other operating revenue and expenses 3 3.9 -0.3
Operating profit -139.1 -115.0

Earnings from particiations in group companies 8, 19 129.3 212.8

Interest income and similar items 8, 19 0.5 0.7
Interest expenses and similar items 8, 19 -11.4 -13.8
Profit after financial items -20.7 84.7

Group contribution 9, 19 131.1 127.5

Profit before tax 110.4 212.2

Taxes 10 -0.6 -1.7

Net profit for the year 109.8 210.5

Statement of comprehensive income for the Parent company

1 January - 31 December
SEKm 2022 2021
Net profit for the year 109.8 210.5

Other compehensive income for the year, net after tax - -

Total comprehensive income for the year 109.8 210.5
132 PARENT COMPANY’S STATEMENT

Balance sheet for the Parent company

31 December
SEKm Note 2022 2021
Assets
Intangible fixed assets 11 164.1 141.3
Tangible fixed assets 12 4.7 4.3
Financial fixed assets
Participations in group companies 13 2,144.6 2,155.1
Other long-term receivables 0.8 0.9
Deferred tax assets 10 12.4 12.9
Total financial fixed assets 2,157.8 2,168.9
Total fixed assets 2,326.6 2,314.5

Current assets
Receivables from group companies 19 208.2 225.7
Current tax assets 10 0.4 0.6
Other receivables 14 7.3 6.8
Prepaid expenses and accrued income 15 23.7 14.7
Cash and cash equivalents 20 0.5 0.5
Total current assets 240.1 248.3
Total assets 2,566.7 2,562.8

Equity
Restricted equity
Share capital 1.2 1.2
Reserves 292.5 292.5
Fund for development expenditure 99.7 84.6
Total restricted equity 393.4 378.3
Unrestricted equity 21

Share premium reserve 5.9 5.9

Retained earnings 513.7 441.1
Net profit for the year 109.8 210.5
Total unrestricted equity 629.4 657.5
Total equity 1,022.8 1,035.8

Liabilities
Liabilities to group companies 19 1,079.8 1,102.7
Other long-term liabilities 16 23.4 18.3
Provisions 1.3 1.0
Total long-term liabilities 1,104.5 1,122.0

Accounts payable 24.4 20.8

Liabilities to group companies 19 386.5 360.7
Other liabilities 16 2.2 2.0
Accrued expenses and prepaid income 17 26.3 21.5
Total current liabilities 439.4 405.0
Total equity and liabilities 2,566.7 2,562.8
 PARENT COMPANY’S STATEMENT   133

Statement of changes in equity for the Parent company

Restricted equity Unrestricted equity
Fund for Share Retained earnings,
Share development premium including net
capital Reserves expenses reserve profit for the year Total equity
Opening equity 2021-01-01 1.2 292.5 31.9 5.9 528.9 860.4
Net profit for the year – – – – 210.5 210.5
Transfer to development fund (net) – – 52.7 – -52.7 –
Other comprehensive income
Total comprehensive income – – 52.7 – 157.8 210.5
Transactions with group’s owners
Dividend – – – – -35.1 -35.1
Closing equity 2021-12-31 1.2 292.5 84.6 5.9 651.6 1,035.8

Opening equity 2022-01-01 1.2 292.5 84.6 5.9 651.6 1,035.8

Net profit for the year – – – – 109.8 109.8
Transfer to development fund (net) – – 15.1 – -15.1 –
Other comprehensive income
Total comprehensive income – – 15.1 – 94.7 109.8
Transactions with Group’s owners
Dividend – – – – -122.8 -122.8
Closing equity 2022-12-31 1.2 292.5 99.7 5.9 623.5 1,022.8

Cash flow statement for the Parent company

1 January - 31 December
SEKm Note 2022 2021
Operating activities
Operating profit/loss -139.1 -115.0
Adjustment for items not included in cash flow 20 22.9 38.6
Dividends received 19 141.2 212.8
Interest received and other financial items 0.5 0.7
Interest paid and other financial items -6.1 -7.8
Income tax paid 0.3 -4.1
Cash flow from operating activities before changes in working capital 19.7 125.2

Cash flow from changes in working capital

Increase (-)/Decrease(+) of operating receivables -10.2 -7.3
Increase (+)/Decrease (-) of operating liabilities 24.2 4.8
14.0 -2.5
Cash flow from operating activities 33.7 122.7

Investment activities
Capital expenditure for tangible fixed assets -2.5 -1.9
Capital expenditure for intangible fixed assets -61.4 -49.2
Acquisition/capital contribution subsidiaries -1.4 -14.7
Write-down of participations in group companies 11.9 -
Cash flow from investment activities -53.4 -65.8

Financial activities
Group contributions received/paid 127.6 -53.6
Change in interest-bearing receivables/liabilities in group companies 14.9 31.9
Dividend paid -122.8 -35.1
Cash flow from financing activities 19.7 -56.8

Cash flow for the year 0.0 0.1

Cash and cash equivalents at the beginning of the year 0.5 0.4
Cash and cash equivalents at the end of the year 20 0.5 0.5
134 PARENT COMPANY’S STATEMENT

1 Accounting policies 4 Employees

The parent company has prepared its annual accounts in accordance with the
Average number 2022 2021
Swedish Annual Accounts Act (1995:1554) and RFR 2, Accounting for Legal Women Men Total Women Men Total
of employees
Entities issued by the Swedish Financial Reporting Board. This means that the Sweden 12 20 32 12 16 28
parent company applies in its financial reporting, as far as possible, all EU-ap- Total 12 20 32 12 16 28
proved IFRS under the Swedish Annual Accounts Act and that it takes into
account the connection between accounting and taxation.
Distribution according to gender in senior
management, percentage of women 2022 2021
Nederman group’s accounting policies appear in each note in the consoli-
Board of Directors 50% 33%
dated section of the Annual Report. The principle differences between the
Other senior executives 20% 20%
accounting policies applied in Nederman group and in the parent company are
described in the respective notes in the parent company section of the Annual
Salaries, other remuneration and social security
Report.
expenses, SEKm 2022 2021
Salaries and other remuneration 40.4 36.0
Accounting policies Note Social security expenses 15.6 13.6
Sales 2 Sales Pension expenses* 7.8 7.3
Leasing 6 Leasing
*Of the company's pension costs SEK 1,8m (1.6) concerns the CEO for the parent company.
Revenue from dividends 8 Net financial items There are no outstanding pension obligations to the Group’s Board of Directors, CEO and
Untaxed reserves 9 Appropriations senior executives.

Group contribution 9 Appropriations

Capitalised development expenditure 11 Intangible fixed assets
Salaries and other remuneration allocated
Financial fixed assets 13 Shares and participations
between the Board of Directors and other
Financial guarantees 18 Pledged assets and
employees, SEKm 2022 2021
contingent liabilities Board of Directors, CEO and senior executives 21.3 18.4
(of which variable compensation) (6.1) (4.3)
2 Revenue Other employees 19.1 17.6
Total 40.4 36.0
Accounting policies

Sales 5 Pensions
The parent company’s revenue consists of inter-company manage-
ment fees, which are invoiced to the subsidiaries. Revenue from SEKm 2022 2021
management fees is recognised at a point in time, which is when the Costs for defined-contribution pension plans 7.8 7.3
service is performed and the subsidiaries can benefit from the service Total 7.8 7.3
provided.
For more information about handling of pensions, see group note 24,
Pension provisions and similar obligations.
SEKm 2022 2021
Management charges 19.4 26.4
Total 19.4 26.4
6 Leasing
Accounting policies

3 Other operating income and expenses Leasing

In accordance with RFR 2, the parent company applies the exemp-
SEKm 2022 2021
tion in IFRS 16, which means that the parent company recognises
Exchange gains and losses on operating 3.9 -0.3
lease payments as operating expenses in the income statement on a
receivables/liabilities Accounting policies
straight-line basis over the lease term for all leases.
Total 3.9 -0.3

Leasing fees were the company is the lessee, SEKm 2022 2021
Within one year 0.5 0.4
Between one and five years 0.8 0.1
Total 1.3 0.5

Expensed leasing costs, SEKm 2022 2021

Leasing expenses 0.6 0.6
Total 0.6 0.6
 PARENT COMPANY’S STATEMENT   135

7 Fees and expenses to auditors 9 Appropriations

Accounting policies

SEKm 2022 2021

Untaxed reserves
EY
Audit assignment 0.9 0.9 The parent company recognises the difference between deprecia-
Audit-related fee 0.9 0.7 tion/amortisation according to plan and tax depreciation/amortisation
Total 1.8 1.6 as accumulated excess depreciation/amortisation, which are included
in untaxed reserves. In the consolidated financial statements, untaxed
reserves are divided into deferred tax liability and equity.

8 Net financial items Group contribution

Recognition of group contributions was made in accordance with the
Accounting policies
alternative rule in RFR 2, meaning that group contributions are rec-
ognised as appropriations.
Revenue from dividends
Revenue from dividends is recognised when the right to receive divi-
dends has been established. Dividends received are recognised as rev-
SEKm 2022 2021
enue regardless of whether or not the dividends relate to profit earned
Group contribution 131.1 127.5
before the acquisition date.
Total 131.1 127.5

SEKm 2022 2021

Earnings from participations in group companies
10 Income tax
Dividend 141.2 212.8
Impairment of book value of shares in subsidiaries -11.9 - Reported in income statement
Total 129.3 212.8 Current tax expense (-)/tax income (+), SEKm 2022 2021
Tax expense for the period - -0.3
Interest income and similar items Total - -0.3
Other financial income, group companies 0.5 0.7
Total 0.5 0.7 Deferred tax expense (–) /tax income (+)
Deferred tax income concerning tax loss -0.6 -1.4
Interest expenses and similar items carryforwards
Interest expenses, credit institutions -0.0 -0.1 Total reported tax expense -0.6 -1.7
Other financial expenses, group companies -11.0 -11.2
Exchange rate changes -0.4 -2.5 Reconciliation of effective tax, SEKm 2022 2021
Total -11.4 -13.8 Profit before tax 110.4 212.2
Tax according to the applicable tax rate -22.7 -43.7
Non-tax deductible expenses -2.9 -1.8
Non-taxable income 29.1 43.8
Revaluation of tax loss carry-forward -4.1 -
Reported effective tax -0.6 -1.7

Posted in the statement of financial position

Deferred tax assets, SEKm 2022 2021
Intangible fixed assets - 0.2
Tangible fixed assets 0.1 -
Provisions 0.3 0.2
Loss carryforwards 12.0 12.5
Deferred tax assets/liabilities according to 12.4 12.9
statement of financial position
136 PARENT COMPANY’S STATEMENT

11 Intangible fixed assets

Accounting policies

Capitalised development expenditure

Development expenditure capitalised during the year, for development amount is transferred from unrestricted equity to a reserve for develop-
work performed within the Nederman group on intangible assets, the ment expenditure pertaining to restricted equity.

2022
Capitalised Current
development Computer investments and
SEKm expenditure programmes advances Total
Accumulated cost
Opening balance 165.8 118.9 7.5 292.2
Internally developed assets 37.9 - - 37.9
Capital expenditure - 14.1 9.4 23.5
Reclassifications - 6.3 -6.3 -
Closing balance 203.7 139.3 10.6 353.6

Accumulated amortisation and impairment

Opening balance -80.9 -70.0 - -150.9
Amortisation -22.8 -15.8 - -38.6
Closing balance -103.7 -85.8 - -189.5

Carrying amount
Opening balance 84.9 48.9 7.5 141.3
Closing balance 100.0 53.5 10.6 164.1

2021
Capitalised Current
development Computer investments and
SEKm expenditure programmes advances Total
Accumulated cost
Opening balance 136.6 82.4 29.4 248.4
Internally developed assets 30.0 - - 30.0
Capital expenditure - 11.7 7.5 19.2
Sold and scrapped -0.8 -4.6 - -5.4
Reclassifications - 29.4 -29.4 -
Closing balance 165.8 118.9 7.5 292.2

Accumulated amortisation and impairment

Opening balance -59.8 -59.5 - -119.3
Sold and scrapped - 4.6 - 4.6
Amortisation -21.1 -15.1 - -36.2
Closing balance -80.9 -70.0 - -150.9

Carrying amount
Opening balance 76.8 22.9 29.4 129.1
Closing balance 84.9 48.9 7.5 141.3

Amortisation and impairments, SEK m 2022 2021

Amortisation is included in the following rows in the income statement:
Administrative expenses -38.6 -36.2
Total -38.6 -36.2
 PARENT COMPANY’S STATEMENT   137

12 Tangible fixed assets

2022 2021
Current Current
Equipment, investments Equipment, investments
SEKm tools, fixtures and advances Total tools, fixtures and advances Total
Accumulated cost
Opening balance 12.7 1.7 14.4 13.5 - 13.5
Capital expenditure 1.8 0.7 2.5 0.2 1.7 1.9
Sold and scrapped - - - -1.0 - -1.0
Reclassifications 1.6 -1.6 - - - -
Closing balance 16.1 0.8 16.9 12.7 1.7 14.4

Accumulated depreciation and impairment

Opening balance -10.1 - -10.1 -8.6 - -8.6
Depreciation -2.1 - -2.1 -2.5 - -2.5
Sold and scrapped - - - 1.0 - 1.0
Closing balance -12.2 - -12.2 -10.1 - -10.1

Carrying amount
Opening balance 2.6 1.7 4.3 4.9 - 4.9
Closing balance 3.9 0.8 4.7 2.6 1.7 4.3

Depreciation and impairments, SEKm 2022 2021

Depreciation is included in the following rows in the income statement:
Administrative expenses -2.1 -2.5
Total -2.1 -2.5
138 PARENT COMPANY’S STATEMENT

13 Shares and participations

Accounting policies

Subsidiaries capitalised in the parent company’s financial statements as part of the cost
Subsidiaries are the companies over which Nederman Holding AB has a of subsidiaries’ shares. Shares in subsidiaries and receivables from subsid-
controlling influence. Controlling influence exists if Nederman Holding AB iaries are tested for impairment annually and in the event of an indication
has an influence over the investment object, is exposed to or has rights to of impairment. Impairment testing is carried out by comparing the parent
variable returns from its involvement and can use its influence over the company’s recognised cost with the subsidiaries’ net asset value, including
investment to affect these returns. When determining whether a con- their long-term earning capacity. Any impairment losses are not reversed.
trolling influence exists, potential voting shares are taken into consider-
ation. Participations in subsidiaries are recognised in the parent company Shareholders’ contributions for legal entities
in accordance with the cost method. All expenses incurred in connection Shareholders’ contributions are added to the value of shares and partici-
with business combinations, including acquisition-related expenses, are pations in the balance sheet, after which impairment testing is carried out.

2022 2021
Corporate Carrying Carrying
The parent company’s holdings of shares identification Number Ownership amount amount
and participations in group companies number Domicile / Country of shares share SEKm SEKm
AB Ph. Nederman & Co 556089-2951 Helsingborg, Sweden 550,000 100% 329.2 329.2
Auburn FilterSense LLC 6543811 Wilmington, DE USA - -* - -
Energy Save System Ltd 09308305 Kettering, UK 100 100% 33.4 32.1

Environmental Filtration 429043276 Pontcharra, France - -* - -

Technologies France Holding
Filtac AB 556652-2750 Kinna, Sweden - 100% 0.3 12.2
Gasmet Technologies (Asia) Ltd 950990 Hong Kong - -* - -
Gasmet Technologies (UK) Ltd 2301809 Naseby, UK - -* - -
Gasmet Technologies GmbH HRB 105091 Karlsruhe, Germany - -* - -
Gasmet Technologies Inc. 707771-8 Toronto, Canada - -* - -
Gasmet Technologies Oy 2681803-8 Helsinki, Finland 31,403 100% 515.7 515.7
LCI Corporation International 56-0732889 Charlotte, NC USA - -* - -
Lebon & Gimbrair Beheer N.V. 31033906 Amersfoort, the Netherlands - 100% 26.7 26.7
Luwa Air Engineering (Pte.) Ltd. 197400205K Singapore, Singapore - -* - -
Luwa Air Engineering (Shanghai) Co., Ltd. 913100006073822526 Shanghai, China - -* - -
Luwa Air Engineering AG CHE-112.154.099 Zurich, Switzerland 950,000 100% 203.2 203.2
Luwa America, Inc C201412600738 Greensboro, NC USA - -* - -
Luwa Havalandirma Teknikleri Sanayi 826319 Istanbul, Turkey - -* - -
ve Ticaret Limited Sirketi
Luwa India Private Limited U01711KA1993FTC014292 Bangalore, India - -* - -
MBE AG CHE-107.899.911 Wetzikon, Switzerland - -* - -
Menardi Filters Europe A/S 38209205 Mariager, Denmark - 100% 0.7 0.7
Menardi LLC 56-2173466 Wilmington, DE USA - -* - -
Mikropul Australia Holdings Pty Ltd 85090925072 Bayswater, Victoria, - -* - -
Australia
Mikropul Australia Pty Ltd 75000932374 Bayswater, Victoria, - -* - -
Australia
MikroPul France SAS 303573307 Pontcharra, France - -* - -
Mikropul Holding BV 17119906 Amersfoort, the Netherlands - 100% - -
MonitoringSystems GmbH FN 211207 z Mauerbach, Austria - -* - -
National Conveyors Company Inc. 22-1547550 New York, NY USA - -* - -
Nederman (Malaysia) Sdn Bhd. 892768T Selangor, Malaysia - -* - -
Nederman (Shanghai) Co Ltd 9131000067113929XX Shanghai, China - -* - -
Nederman Canada Ltd 105836613 Mississauga, Canada 1 100% 32.1 32.1
Nederman Corporation 56-0488262 Wilmington, DE USA - -* - -
Nederman CR s.r.o. 25634364 Prague, Czech Republic 1 100% 0,0 0,0
Nederman Danmark, Filial af 36414642 Mariager, Denmark - -* - -
Nederman Nordic AB
Nederman Distribution Sales AB 556272-9854 Helsingborg, Sweden - -* - -
Nederman do Brasil Comércio 05.880.850/0001-45 Sao Paulo, Brazil 3,365 100% 6.1 6.1
de Produtos de Exaustao Ltda
Nederman Filtration AB 556609-6177 Malmö, Sweden - -* - -
Nederman Filtration GmbH** HRB391382 Freiburg, Germany - -* - -
Nederman Filtration Ltd 562216 Preston, UK - -* - -
Nederman Finance AB 559160-6081 Helsingborg, Sweden 1,000 100% 0.5 0.5
Nederman GmbH (Austria) FN2315530k Vienna, Austria - -* - -
Nederman GmbH** HRB225315 Stuttgart, Germany - 100% 19.2 19.2
Nederman Holding Danmark A/S 28301650 Mariager, Denmark 60,500 100% 231.3 231.3
Nederman Holding Germany GmbH HRB701805 Freiburg, Germany - -* - -
 PARENT COMPANY’S STATEMENT   139

13 Shares and participations, continued

2022 2021
Corporate Carrying Carrying
The parent company’s holdings of shares identification Number Ownership amount amount
and participations in group companies number Domicile / Country of shares share SEKm SEKm
Nederman Holding USA Inc 80-0699546 Wilmington, DE USA - 100% 106.5 106.5
Nederman Ibérica S.A. A79441762 Madrid, Spain - -* - -
Nederman India Private Limited U74900PN2008FTC144278 Pune, India 100,000 100% 10.6 10.6
Nederman Insight AB 559175-9468 Helsingborg, Sweden 1,000 100% 0.3 0.2
Nederman Insight NUF 926115898 Skedsmo, Norway - -* - -
Nederman International Trading 91310115688759399Y Shanghai, China - -* - -
Shanghai Co. Ltd
Nederman Ltd 1393492 Preston, UK 10,000 100% 49.3 49.3
Nederman Magyarorszag Kft 01-09-874950 Budapest, Hungary - 100% 0.2 0.2
Nederman Makine Sanayi Ve Ticaret 647743 Istanbul, Turkey - 53%* 7.6 7.6
Limited Sirketi
Nederman Manufacturing & Logistics LLC 90-0676051 Wilmington, DE USA - -* - -
Nederman Manufacturing (Suzhou) Co Ltd 9132050578206245 93 Suzhou, China - -* - -
Nederman Manufacturing Poland Sp. z o.o. 0000050307 Marki, Poland - -* - -
Nederman Mikropul Canada Inc. 56-2172876 Wilmington, DE USA - -* - -
Nederman MikroPul GmbH** HRB 33261 Cologne, Germany - -* - -
Nederman MikroPul Holding Inc 04-3833071 Wilmington, DE USA - -* - -
Nederman Mikropul LLC 46-4352369 Wilmington, DE USA - -* - -
Nederman MikroPul Poland Sp. z o.o. 0000617869 Marki, Poland - -* - -
Nederman MikroPul Pty Ltd 75002459672 Bayswater, Victoria, - 100% 14.4 14.4
Australia
Nederman N.V./S.A. 428727 Brussels, Belgium 4,000 100% 30.4 30.4
Nederman Nederland BV 58655360 Amersfoort, the Netherlands - -* - -
Nederman Nordic AB 556426-7358 Helsingborg, Sweden 2,000 100% 110.6 110.6
Nederman Norge, Filial til Nederman Nordic 914149762 Skedsmo, Norway - -* - -
Nederman OOO 1082468,018,511 Moscow, Russia - -* - -
Nederman Polska Sp. z o.o. 0000109291 Marki, Poland - -* - -
Nederman S. de R.L. de C.V MIK0001128K6 Col Juarez, Mexico - -* - -
Nederman S.A.S. 434134615 Paris, France - -* - -
Nederman SEA Co Ltd 105534081588 Chonburi, Thailand - -* - -
Nederman Shared Services LLC 46-4172135 Wilmington, DE USA - -* - -
NEO Monitors AS 986076832 Skedsmo, Norway 147,076 100% 415.9 415.9
NEO Monitors Corporation 85-1153790 Wilmington, DE USA - -* - -
Nordfab Ducting Co Ltd 125549002956 Chonburi, Thailand - 51%* 0.2 0.2
Nordfab Europe AS 17011405 Mariager, Denmark - -* - -
Nordfab LLC 56-1230979 Wilmington, DE USA - -* - -
Nordfab Pty Ltd 15658403948.0 Sydney, Australia 100 100% - -
PT Nederman Indonesia - Jakarta, Indonesia - 10%* 0.2 0.2
RoboVent Acquisition, Inc. 82-3939810 Dover, DE, USA - -* - -
RoboVent Products Group, Inc. 38-2888296 Sterling Heights, MI, USA - -* - -
RoboVent Solutions Group, Inc. 17143D Sterling Heights, MI, USA - -* - -
Total 2,144.6 2,155.1

Accumulated cost, SEK m 2022 2021

Opening balance 2,155.1 2,122.9
Acquisition of group companies 1.3 32.1
Capital contribution 0.1 0.1
Impairment of book value -11.9 -
Closing balance at December 31 2,144.6 2,155.1
140 PARENT COMPANY’S STATEMENT

14 Other receivables 18 Pledged assets and contingent liabilities

Accounting policies
Other receivables which are current assets,
SEKm 2022 2021 Financial guarantees
VAT receivable 7.3 5.6 The parent company’s financial guarantees consist mainly of guar-
Other receivable - 1.2 antees on behalf of subsidiaries. Financial guarantees mean that the
Total 7.3 6.8 company has an obligation to compensate the owner of a debt instru-
ment for losses that the owner may incur because a specified debtor
fails to make payment when due under the contract terms. The parent
company recognises financial guarantee agreements as a provision
15 Prepaid expenses and accrued income in the balance sheet when the company has a commitment for which
payment will probably be required in order to settle the obligation.

SEKm 2022 2021

Computer/license costs 14.3 11.4 Contingent liabilities, SEKm 2022 2021
Insurance 1.9 0.8 FPG/PRI 0.7 0.7
Other 7.5 2.5 Warranty commitments 102.1 62.2
Total 23.7 14.7 Total 102.8 62.9

16 Other liabilities 19 Related party transactions

Other long-term liabilities, SEKm 2022 2021 The parent company has related party relationships with its subsidiaries, see
Deferred payment of acquisition price (see more in 23.4 18.3 note 13 Shares and participations.
Group note 4).
Total 23.4 18.3 No member of the Board of Directors or senior executives have or have had any
direct or indirect participation in any business transaction with group compa-
Other short-term liabilities, SEKm 2022 2021 nies which is or was of an exceptional character with regard to terms and condi-
Personnel-related liabilities 2.2 2.0 tions that occurred during the year or in any previous financial year. Nor has any
Total 2.2 2.0 group company provided any loan, given any guarantees or entered into any
surety relationships for any of the members of the Board of Directors or senior
executives. Loans to subsidiaries are made on market terms.

17 Accrued expenses and prepaid income Related party transactions, subsidiaries, SEKm 2022 2021
Net sales - Management charges 19.4 26.4
Dividends received 141.2 212.8
SEKm 2022 2021 Group contribution received 131.1 127.5
Personnel-related expenses 22.7 20.0 Financial income 0.5 0.7
Audit expenses 0.1 0.3 Financial expenses -11.0 -11.1
Other 3.5 1.2 Receivables, 31 December 208.2 225.7
Total 26.3 21.5 Liabilities, 31 December 1,466.3 1,463.4

Transactions with key persons in leading positions

Regarding the salaries and other remuneration, costs and commitments for
pensions and similar benefits, and severance payment agreements for Board
members, the CEO and other senior executives, see group note 8 Personnel
and note 24 Provision for pensions and similar obligations.
 PARENT COMPANY’S STATEMENT   141

20 Cash flow

Liquid funds , SEKm 2022 2021

Subcomponents in cash and cash equivalents:
Cash and cash equivalents 0.5 0.5
Total 0.5 0.5

Adjustments for items not included in cash flow, SEKm 2022 2021
Depreciation 40.7 38.7
Capital gains/losses fixed assets - 0.8
Unrealised translation differences -6.2 -0.9
Impairment of shares in subsidiaries -11.9 -
Provisions 0.3 -
Total 22.9 38.6

Unused credits, SEKm 2022 2021

Disposable funds 0.5 0.5

Financial activities
The following table shows the changes in receivables and liabilities included in financial activities.

Items not
Cash flow affecting cash flow
Amount at begin- Interests Exchange rate Amount at
2022, SEKm ning of the year and fees gains/losses year end
Long-term interest-bearing liabilities group companies 1,102.7 -22.6 - - 0.3 1,079.8
Short-term interest-bearing assets (-) & liabilites (+) group companies 282.9 37.5 5.3 -0.4 325.3
Total 14.9

Items not
Cash flow affecting cash flow
Amount at begin- Interests Exchange rate Amount at
2021, SEKm ning of the year and fees gains/losses year end
Long-term interest-bearing liabilities group companies 1,167.5 -65.8 - 1.0 1,102.7
Short-term interest-bearing assets (-) & liabilites (+) group companies 180.9 97.7 5.3 -1.0 282.9
Total 31.9

21 Appropriation of profit or loss

The following is at the disposal of the Annual General Meeting of Nederman Holding AB (publ):
SEK 2022 2021
Share premium reserve 5,866,700 5,866,700
Retained earnings 513,733,621 441,226,753
Net profit for the year 109,808,839 210,455,783
Total 629,409,160 657,549,236

The Board of Directors propose

a dividend to shareholders of SEK 3.75 (3.50) per share* 131,599,110 122,825,836
to be transferred to the share premium reserve 5,866,700 5,866,700
to be transferred to retained earnings 491,943,350 528,856,700
Total 629,409,160 657,549,236

*Based on the number of shares outstanding at 31 December 2022. The dividend amount could be changed as treasury shares could be converted by the record date of
14 April 2023.

22 Events after the end of the reporting period

No significant events occurred after the balance sheet date.
142   SIGNATURES

Signatures
The consolidated accounts and the annual report have been pre- The Directors’ Report for the Group and parent company pro-
pared in accordance with international accounting standards as vides a fair overview of the Group’s and parent company’s
prescribed in Regulation (EC) no. 1606/2002 of the European Par- activities, position and results and describe the main risks
liament and of the Council dated 19 July 2002 concerning the appli- and uncertainties facing the parent company and Group com-
cation of international accounting standards and good accounting panies. The annual report and consolidated accounts will
practice in Sweden, and give a fair picture of the Group’s and par- be subject to adoption by the Annual General Meeting on
ent company’s position and results. 24 April 2023.

Helsingborg, 15 March 2023

Johan Menckel
Chairman

Gunilla Fransson Ylva op den Velde Hammargren Sam Strömerstén

Board member Board member Board member

Sven Kristensson
Board member and CEO

Our audit report was issued on 16 March 2023

Ernst & Young AB

Andreas Mast
Authorised Public Accountant
 AUDIT REPORT    143

Auditor’s report

TO THE GENERAL MEETING OF THE SHAREHOLDERS OF NEDERMAN HOLDING AB (PUBL),

CORPORATE IDENTITY NUMBER 556576-4205

REPORT ON THE ANNUAL ACCOUNTS AND CONSOLIDATED ACCOUNTS

Opinions
We have audited the annual accounts and consolidated accounts Our opinions in this report on the annual accounts and consoli-
of Nederman Holding AB (publ) except for the corporate gover- dated accounts are consistent with the content of the additional
nance statement on pages 86-89 and 92-93 and the sustainabi- report that has been submitted to the parent company’s audit
lity report on pages 54-75 for the year 2022. The annual accounts committee in accordance with the Audit Regulation (537/2014)
and consolidated accounts of the company are included on pages Article 11.
44-141 in this document.
Basis for Opinions
In our opinion, the annual accounts have been prepared in accor- We conducted our audit in accordance with International Stan-
dance with the Annual Accounts Act and present fairly, in all mate- dards on Auditing (ISA) and generally accepted auditing standards
rial respects, the financial position of the parent company as of in Sweden. Our responsibilities under those standards are fur-
31 December 2022 and its financial performance and cash flow ther described in the Auditor’s Responsibilities section. We are
for the year then ended in accordance with the Annual Accounts independent of the parent company and the group in accordan-
Act. The consolidated accounts have been prepared in accordance ce with professional ethics for accountants in Sweden and have
with the Annual Accounts Act and present fairly, in all material res- otherwise fulfilled our ethical responsibilities in accordance with
pects, the financial position of the group as of 31 December 2022 these requirements. This includes that, based on the best of our
and their financial performance and cash flow for the year then knowledge and belief, no prohibited services referred to in the
ended in accordance with International Financial Reporting Stan- Audit Regulation (537/2014) Article 5.1 have been provided to the
dards (IFRS), as adopted by the EU, and the Annual Accounts Act. audited company or, where applicable, its parent company or its
Our opinions do not cover the corporate governance statement controlled companies within the EU.
on pages 86-89 and 92-93 and the sustainability report on pages
54-75. The statutory administration report is consistent with the We believe that the audit evidence we have obtained is sufficient
other parts of the annual accounts and consolidated accounts. and appropriate to provide a basis for our opinions.

We therefore recommend that the general meeting of share-

holders adopts the income statement and balance sheet for the
parent company and the group.

Key Audit Matters

Key audit matters of the audit are those matters that, in our pro- We have fulfilled the responsibilities described in the Auditor’s
fessional judgment, were of most significance in our audit of the responsibilities for the audit of the financial statements section
annual accounts and consolidated accounts of the current period. of our report, including in relation to these matters. Accordingly,
These matters were addressed in the context of our audit of, and in our audit included the performance of procedures designed to
forming our opinion thereon, the annual accounts and consolidated respond to our assessment of the risks of material misstatement
accounts as a whole, but we do not provide a separate opinion on of the financial statements. The results of our audit procedu-
these matters. For each matter below, our description of how our res, including the procedures performed to address the matters
audit addressed the matter is provided in that context. below, provide the basis for our audit opinion on the accompanying
financial statements.
144   AUDIT REPORT

Valuation of Goodwill

Valuation of Goodwill How our audit addressed this key audit matter
The carrying value of goodwill at 31 December 2022 was SEK In our audit, we have evaluated and tested the company’s pro-
2 027,5 million which corresponds to 32,6 % of the company’s cess to establish the impairment test, including by evaluating
total assets in the group. The company conducts an annual past accuracy of forecasts and assumptions. We also made
review and in the event of an indication of impairment, to assu- comparisons with other companies in order to evaluate the rea-
re that the carrying value does not exceed the estimated reco- sonableness of future cash flows and growth assumptions, and
verable value. The recoverable amount is determined for each with the help from our valuation specialists examined the selec-
cash generating unit by calculating the present value of futu- ted discount rate and assumptions about long term growth. We
re cash flows. Future cash flows are based on management’s have also reviewed the company’s model and method for carry-
business plans and forecasts, and include a number of assump- ing out impairment testing and evaluated the company’s sen-
tions, including on earnings performance, growth, investment sitivity analyses. We have also reviewed the disclosures in the
requirements and the discount rate. financial statements.

Changes in assumptions have a great impact on the calculation

of the recoverable value and the assumptions that the compa-
ny makes will be of great importance when determining if there
is a need for impairment. We have therefore considered that
the valuation of goodwill is a key audit matter in the audit.

A description of the impairment test is presented in note 13

“Intangible assets”.

Revenue relating to Solutions (project sales)

Description How our audit addressed this key audit matter

Net sales for the group 2022 amounts to total SEK 5 178,9 mil- We have reviewed the company’s process for revenue recog-
lion and of this SEK 2 228,3 million relates to solutions (project nition of the segment solutions and assessed the company’s
sales), representing 43 % of total net sales. The accounting estimation of the grade of fulfillment of the performance obli-
policies that the company applies for revenue recognition att- gation. We have by testing samples reviewed the company’s
ributable to solutions is described on page 105 of the annual assessments of expected profit or loss of the project by com-
report, in note 6 “Revenue from contracts with customers”. parisons with agreements, historical results and budget. The
The revenue of solutions is accounted for over time by mea- assessments made by the company regarding the risk of loss
suring the current fulfillment of the performance obligation have also been reviewed. We have also reviewed the disclosu-
and comparing it to the complete fulfillment of the performan- res in the financial statements.
ce obligation. This is done by putting the accrued expenses in
relation to the total projected expenses of goods or services
that have been agreed upon. Revenue recognition of solutions
requires estimates in measuring the current fulfillment of the
performance obligation and comparing it to the complete ful-
fillment of the performance obligation. Changes in these esti-
mations can have a material impact on the result of the com-
pany, and we have therefore considered revenue recognition
related to solutions to be a key audit matter in the audit.

Other Information than the annual accounts and consolidated accounts

This document also contains other information than the annual In connection with our audit of the annual accounts and consoli-
accounts and consolidated accounts and is found on pages 1-43 dated accounts, our responsibility is to read the information iden-
and 148-152. The renumeration report for the year 2022 does tified above and consider whether the information is materially
also constitute other information. The Board of Directors and the inconsistent with the annual accounts and consolidated accounts.
Managing Director are responsible for this other information. In this procedure we also take into account our knowledge other-
wise obtained in the audit and assess whether the information
Our opinion on the annual accounts and consolidated accounts otherwise appears to be materially misstated.
does not cover this other information and we do not express any
form of assurance conclusion regarding this other information.
 AUDIT REPORT    145

If we, based on the work performed concerning this information, collusion, forgery, intentional omissions, misrepresentations,
conclude that there is a material misstatement of this other infor- or the override of internal control.
mation, we are required to report that fact. We have nothing to ■ Obtain an understanding of the company’s internal control
report in this regard. relevant to our audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose
Responsibilities of the Board of Directors of expressing an opinion on the effectiveness of the compa-
and the Managing Director ny’s internal control.
The Board of Directors and the Managing Director are respon- ■ Evaluate the appropriateness of accounting policies used
sible for the preparation of the annual accounts and consolida- and the reasonableness of accounting estimates and related
ted accounts and that they give a fair presentation in accordance disclosures made by the Board of Directors and the Managing
with the Annual Accounts Act and, concerning the consolidated Director.
accounts, in accordance with IFRS as adopted by the EU. The Board ■ Conclude on the appropriateness of the Board of Directors’
of Directors and the Managing Director are also responsible for and the Managing Director’s use of the going concern basis of
such internal control as they determine is necessary to enable accounting in preparing the annual accounts and consolidated
the preparation of annual accounts and consolidated accounts accounts. We also draw a conclusion, based on the audit evi-
that are free from material misstatement, whether due to fraud dence obtained, as to whether any material uncertainty exists
or error. related to events or conditions that may cast significant doubt
on the company’s and the group’s ability to continue as a going
In preparing the annual accounts and consolidated accounts, The concern. If we conclude that a material uncertainty exists, we
Board of Directors and the Managing Director are responsible for are required to draw attention in our auditor’s report to the
the assessment of the company’s and the group’s ability to conti- related disclosures in the annual accounts and consolidated
nue as a going concern. They disclose, as applicable, matters rela- accounts or, if such disclosures are inadequate, to modify our
ted to going concern and using the going concern basis of accoun- opinion about the annual accounts and consolidated accounts.
ting. The going concern basis of accounting is however not applied Our conclusions are based on the audit evidence obtained up
if the Board of Directors and the Managing Director intends to to the date of our auditor’s report. However, future events
liquidate the company, to cease operations, or has no realistic or conditions may cause a company and a group to cease to
alternative but to do so. continue as a going concern.
■ Evaluate the overall presentation, structure and content of
The Audit Committee shall, without prejudice to the Board of the annual accounts and consolidated accounts, including the
Director’s responsibilities and tasks in general, among other disclosures, and whether the annual accounts and consoli-
things oversee the company’s financial reporting process. dated accounts represent the underlying transactions and
events in a manner that achieves fair presentation.
Auditor’s responsibility ■ Obtain sufficient and appropriate audit evidence regarding
Our objectives are to obtain reasonable assurance about whether the financial information of the entities or business activities
the annual accounts and consolidated accounts as a whole are within the group to express an opinion on the consolidated
free from material misstatement, whether due to fraud or error, accounts. We are responsible for the direction, supervision and
and to issue an auditor’s report that includes our opinions. Reaso- performance of the group audit. We remain solely responsible
nable assurance is a high level of assurance, but is not a guaran- for our opinions.
tee that an audit conducted in accordance with ISAs and generally
accepted auditing standards in Sweden will always detect a mate- We must inform the Board of Directors of, among other matters,
rial misstatement when it exists. Misstatements can arise from the planned scope and timing of the audit. We must also inform of
fraud or error and are considered material if, individually or in the significant audit findings during our audit, including any significant
aggregate, they could reasonably be expected to influence the deficiencies in internal control that we identified.
economic decisions of users taken on the basis of these annual
accounts and consolidated accounts. We must also provide the Board of Directors with a statement that
we have complied with relevant ethical requirements regarding
As part of an audit in accordance with ISAs, we exercise professi- independence, and to communicate with them all relationships
onal judgment and maintain professional skepticism throughout and other matters that may reasonably be thought to bear on our
the audit. We also: independence, and where applicable, actions taken to eliminate
threats or related safeguards applied.
■ Identify and assess the risks of material misstatement of the
annual accounts and consolidated accounts, whether due to From the matters communicated with the Board of Directors, we
fraud or error, design and perform audit procedures responsive determine those matters that were of most significance in the
to those risks, and obtain audit evidence that is sufficient and audit of the annual accounts and consolidated accounts, including
appropriate to provide a basis for our opinions. The risk of not the most important assessed risks for material misstatement, and
detecting a material misstatement resulting from fraud is are therefore the key audit matters. We describe these matters in
higher than for one resulting from error, as fraud may involve the auditor’s report unless law or regulation precludes disclosure
about the matter.
146   AUDIT REPORT

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

Report on the audit of the administration and the proposed appropriations of the company’s profit or loss

Opinions in accordance with law and handle the management of assets in a

In addition to our audit of the annual accounts and consolidated reassuring manner.
accounts, we have also audited the administration of the Board
of Directors and the Managing Director of Nederman Holding AB Auditor’s responsibility
(publ) for the year 2022 and the proposed appropriations of the Our objective concerning the audit of the administration, and
company’s profit or loss. thereby our opinion about discharge from liability, is to obtain
audit evidence to assess with a reasonable degree of assurance
We recommend to the general meeting of shareholders that the whether any member of the Board of Directors or the Managing
profit be appropriated in accordance with the proposal in the stat- Director in any material respect:
utory administration report and that the members of the Board of
Directors and the Managing Director be discharged from liability ■ has undertaken any action or been guilty of any omission
for the financial year. which can give rise to liability to the company, or
■ in any other way has acted in contravention of the Companies
Basis for opinions Act, the Annual Accounts Act or the Articles of Association.
We conducted the audit in accordance with generally accepted Our objective concerning the audit of the proposed appropri-
auditing standards in Sweden. Our responsibilities under those ations of the company’s profit or loss, and thereby our opinion
standards are further described in the Auditor’s Responsibilities about this, is to assess with reasonable degree of assurance
section. We are independent of the parent company and the whether the proposal is in accordance with the Companies Act.
group in accordance with professional ethics for accountants in
Sweden and have otherwise fulfilled our ethical responsibilities in Reasonable assurance is a high level of assurance, but is not a
accordance with these requirements. guarantee that an audit conducted in accordance with generally
accepted auditing standards in Sweden will always detect actions
We believe that the audit evidence we have obtained is sufficient or omissions that can give rise to liability to the company, or that
and appropriate to provide a basis for our opinions. the proposed appropriations of the company’s profit or loss are
not in accordance with the Companies Act.
Responsibilities of the Board of Directors
and the Managing Director As part of an audit in accordance with generally accepted auditing
The Board of Directors is responsible for the proposal for app- standards in Sweden, we exercise professional judgment and
ropriations of the company’s profit or loss. At the proposal of a maintain professional skepticism throughout the audit. The
dividend, this includes an assessment of whether the dividend examination of the administration and the proposed appropri-
is justifiable considering the requirements which the company’s ations of the company’s profit or loss is based primarily on the
and the group’s type of operations, size and risks place on the size audit of the accounts. Additional audit procedures performed are
of the parent company’s and the group’s equity, consolidation based on our professional judgment with starting point in risk and
requirements, liquidity and position in general. materiality. This means that we focus the examination on such
actions, areas and relationships that are material for the opera-
The Board of Directors is responsible for the company’s organiza- tions and where deviations and violations would have particular
tion and the administration of the company’s affairs. This includes importance for the company’s situation. We examine and test
among other things continuous assessment of the company’s and decisions undertaken, support for decisions, actions taken and
the group’s financial situation and ensuring that the company’s other circumstances that are relevant to our opinion concerning
organization is designed so that the accounting, management of discharge from liability. As a basis for our opinion on the Board of
assets and the company’s financial affairs otherwise are control- Directors’ proposed appropriations of the company’s profit or loss
led in a reassuring manner. The Managing Director shall manage we examined the Board of Directors’ reasoned statement and
the ongoing administration according to the Board of Directors’ a selection of supporting evidence in order to be able to assess
guidelines and instructions and among other matters take whether the proposal is in accordance with the Companies Act.
measures that are necessary to fulfill the company’s accounting

The auditor’s examination of the ESEF report

Opinion Our examination and our opinion relate only to the statutory
In addition to our audit of the annual accounts and consolidated requirements.
accounts, we have also examined that the Board of Directors and
the Managing Director have prepared the annual accounts and In our opinion, the ESEF report has been prepared in a format that,
consolidated accounts in a format that enables uniform electronic in all material respects, enables uniform electronic reporting.
reporting (the Esef report) pursuant to Chapter 16, Section 4(a)
of the Swedish Securities Market Act (2007:528) for Nederman
Holding AB (publ) for the financial year 2022.
 AUDIT REPORT    147

Basis for opinion controls. The examination also includes an evaluation of the
We have performed the examination in accordance with FAR’s appropriateness and reasonableness of assumptions made by
recommendation RevR 18 Examination of the ESEF report. Our the Board of Directors and the Managing Director.
responsibility under this recommendation is described in more
detail in the Auditors’ responsibility section. We are independent The procedures mainly include a technical validation of that the
of Nederman Holding AB (publ) in accordance with professional Esef report has been prepared in a valid XHTML-format and a
ethics for accountants in Sweden and have otherwise fulfilled our reconciliation of the Esef report with the audited annual accounts
ethical responsibilities in accordance with these requirements. and consolidated accounts.

We believe that the evidence we have obtained is sufficient and Furthermore, the procedures also include an assessment of
appropriate to provide a basis for our opinion. whether the consolidated statement of financial performance,
financial position, changes in equity, cash flow and notes in the
Responsibilities of the Board of Directors Esef report has been marked with iXBRL in accordance with the
and the Managing Director ESEF regulation.
The Board of Directors and the Managing Director are responsible
for the preparation of the Esef report in accordance with Chapter The auditor’s examination of the
16, Section 4(a) of the Swedish Securities Market Act (2007:528), corporate governance statement
and for such internal control that the Board of Directors and the The Board of Directors is responsible for that the corporate
Managing Director determine is necessary to prepare the Esef governance statement on pages 86-89 and 92-93 has been
report without material misstatements, whether due to fraud or prepared in accordance with the Annual Accounts Act.
error.
Our examination of the corporate governance statement is
Auditor’s responsibility conducted in accordance with FAR´s standard RevR 16 The
Our responsibility is to obtain reasonable assurance whether auditor´s examination of the corporate governance statement.
the Esef report is in all material respects prepared in a format This means that our examination of the corporate governance
that meets the requirements of Chapter 16, Section 4(a) of the statement is different and substantially less in scope than an
Swedish Securities Market Act (2007:528), based on the procedu- audit conducted in accordance with International Standards on
res performed. Auditing and generally accepted auditing standards in Sweden.
We believe that the examination has provided us with sufficient
RevR 18 requires us to plan and execute procedures to achieve basis for our opinions.
reasonable assurance that the Esef report is prepared in a format
that meets these requirements. A corporate governance statement has been prepared. Disclosu-
res in accordance with chapter 6 section 6 the second paragraph
Reasonable assurance is a high level of assurance, but it is not a points 2-6 of the Annual Accounts Act and chapter 7 section 31
guarantee that an engagement carried out according to RevR 18 the second paragraph the same law are consistent with the other
and generally accepted auditing standards in Sweden will always parts of the annual accounts and consolidated accounts and are in
detect a material misstatement when it exists. Misstatements accordance with the Annual Accounts Act.
can arise from fraud or error and are considered material if,
individually or in aggregate, they could reasonably be expected Ernst & Young AB, Box 7850 103 99 Stockholm, was appointed
to influence the economic decisions of users taken on the basis of auditor of Nederman Holding AB (publ) by the general meeting
the Esef report. of the shareholders on the 25th of April 2022 and has been the
company’s auditor since the 22nd of April 2015.
The audit firm applies ISQC 1 Quality Control for Firms that
Perform Audits and Reviews of Financial Statements, and other Helsingborg the 16th of March 2023
Assurance and Related Services Engagements and accordingly Ernst & Young AB
maintains a comprehensive system of quality control, including
documented policies and procedures regarding compliance with
professional ethical requirements, professional standards and
legal and regulatory requirements. Andreas Mast
Authorized Public Accountant
The examination involves obtaining evidence, through various
procedures, that the Esef report has been prepared in a format
that enables uniform electronic reporting of the annual and
consolidated accounts. The procedures selected depend on
the auditor’s judgment, including the assessment of the risks
of material misstatement in the report, whether due to fraud or
error. In carrying out this risk assessment, and in order to design
audit procedures that are appropriate in the circumstances, the
auditor considers those elements of internal control that are
relevant to the preparation of the Esef report by the Board of
Directors and the Managing Director, but not for the purpose
of expressing an opinion on the effectiveness of those internal
148   DEFINITIONS

Definitions
PERFORMANCE
DEFINITION PURPOSE
MEASURE
Return Net profit for the year after tax divided by average equity. Return on equity shows the return on owners’ capital in accounting terms. This
on equity measure is primarily used to analyse owner profitability over time.
Return on Adjusted operating profit as a percentage of average oper- A profitability measure that shows the return on the capital used to operate the core
operating ating capital. business. Return on operating capital is one of Nederman group’s long-term financial
capital targets.
EBITA Operating profit before amortisation and impairment of EBITA is reported because this is a measure often monitored by investors, analysts
intangible assets. and other stakeholders to measure the company’s financial results. The measure
excludes the amortisation and impairment of intangible assets.
EBITA margin EBITA as a percentage of sales.
EBITDA Operating profit before depreciation, amortisation and EBITDA is reported because this is a measure often monitored by investors, analysts
impairment. and other stakeholders to measure the company’s financial results. The measure
excludes depreciation, amortisation and impairment, thereby showing the business’s
capacity to generate resources for investments and payment to financiers.
EBITDA margin EBITDA as a percentage of net sales.
Equity Equity divided by the average number of shares outstanding. This measure shows how much equity is represented by each share.
per share
Adjusted EBITA Operating profit before amortisation and impairment of Adjusted EBITA is deemed to provide a fair view of the underlying operation’s earn-
intangible assets, excluding acquisition and restructuring ings, whereby earnings exclude amortisation and impairment of intangible assets and
costs and discontinuation of the Norwegian defined-benefit non-recurring items. This is a primary performance measure within the Nederman
pension plan. group in the internal control of the group and the segments.
Adjusted EBITA Adjusted EBITA as a percentage of sales. The adjusted EBITA margin is one of the Nederman group’s long-term profitability
margin targets. Adjusted EBITA margin is deemed to provide a fair view of the underlying
operation’s profitability, when this profitability excludes depreciation, amortisation
and impairment, as well as income items that are non-recurring. This is a primary
performance measure within the Nederman group in the internal control of the group
and the segments.
Adjusted EBITDA Operating profit before depreciation, amortisation and Adjusted EBITDA is recognised because this is a measure often monitored by inves-
impairment, excluding acquisition and restructuring costs tors, analysts and other stakeholders to measure the company’s financial results. The
and discontinuation of the Norwegian defined-benefit measure excludes depreciation, amortisation and impairment, as well as non-recur-
pension plan. ring items. The measure shows the business’s capacity for investments and payment
to financiers.
Adjusted EBITDA Adjusted EBITDA as percentage of sales.
margin
Adjusted EBITDA/ Adjusted EBITDA divided by net financial items The performance measure shows how many times current earnings (adjusted EBIT-
Net financial items DA) covers the company’s net financial items.
Adjusted Operating profit excluding acquisition and restructuring Shows the result from operational activities excluding non-recurring items.
operating costs and discontinuation of the Norwegian defined-benefit
profit pension plan.
Adjusted operating Adjusted operating profit as a percentage of net sales.
margin
Capital turnover Net sales divided by average operating capital. Shows the efficiency of the use of operating capital.
rate
Net debt Interest-bearing liabilities (including pensions) less cash and The measurement shows debt and is used to monitor the debt trend and to identify
cash equivalents. the need for refinancing. This measure comprises a component of the debt ratio.
Net debt/ Net debt divided by adjusted EBITDA. The performance measure shows how many times greater net debt is in relation to
adjusted EBITDA adjusted EBITDA. This is a performance measure monitored by investors, analysts and
other stakeholders.
Net debt Net debt divided by equity. A measure that shows the loan-to-value ratio, which comprises the correlation
/equity ratio between debt and equity. This makes it a measure of financial position and sta-
bility. A good level of net debt/equity ratio provides favourable conditions for
growth opportunities, while the dividend policy can be upheld.
Operating capital Equity plus net debt. Operating capital shows how much capital there is in the operation. This measure is
mainly used to calculate the return on operating capital.
Organic growth Growth rate that does not come from acquisitions or currency Organic growth enables a comparison over time for the companies that have been a
effects, compared with the corresponding period in the part of the Nederman group for more than 12 months, excluding effects of changed
preceding year. exchange rates. The measure is used to show the ability to generate growth in
existing operations.
Earnings per share Net profit for the year attributable to parent company Earnings per share shows how much of the period’s earnings that each share provides
(before dilution) shareholders in relation to the average number of shares entitlement to.
outstanding.
Earnings per share Net profit for the year attributable to parent company
(after dilution) shareholders in relation to the average number of shares
outstanding plus the average number of convertibles and
warrants, as calculated in accordance with IAS 33.
Interest-coverage Profit before tax with a reversal of financial expenses and The performance measure shows the capacity to cover the financial expenses. The
ratio acquisition costs in relation to financial expenses. performance measure states how many times the group’s earnings cover the financial
expenses.
Operating profit Operating profit after depreciation, amortisation and Shows the earnings from operational activities.
impairment.
Operating margin Operating profit as a percentage of net sales.

Equity/assets ratio Equity divided by total assets (balance sheet total). This performance measure reflects the company’s financial position and thus its
long-term payment capacity. A healthy equity/assets ratio, in other words, a strong
financial position, provides the requirements to be able to manage weak economic
periods and to capitalise on future growth opportunities.
Currency-neutral Currency-neutral growth is the growth rate that does not Currency-neutral growth comprises organic growth plus growth from acquired
growth come from currency effects, compared with the correspond- subsidiaries, which are deemed to provide a fair view of the operations’ development.
ing period in the preceding year. Currency-neutral growth is one of Nederman group’s long-term financial targets.
Annual average Average of the balance at the beginning and end of the year.
 ARTICLES OF ASSOCIATION   149

Articles of Association
Nederman Holding AB (publ.)
Corp. Reg. No. 556576-4205

1 § COMPANY NAME 11 § RIGHT TO PARTICIPATE IN ANNUAL GENERAL

The name of the company is Nederman Holding Aktiebolag. The MEETING.
company is a public company (publ). Shareholders who wish to participate in proceedings at the
Annual General Meeting must be included in the transcript of the
2 § REGISTERED OFFICE. entire share register on the record date for the annual general
The registered office of the Board of Directors is in Helsingborg meeting, which is determined in accordance with the Swedish
municipality. Annual Accounts Act, and they must register with the company
not later than the day specified in the notice of the Annual General
3 § COMPANY’S OPERATIONS. Meeting. This day may not be a Sunday, other general holiday,
The object of the company’s operations is to directly or through Saturday, Midsummer Eve, Christmas Eve, or New Year’s Eve,
subsidiaries produce and market products to improve the nor may it fall earlier than the fifth weekday before the Annual
industrial workplace environment and to own and manage General Meeting. Shareholders or representatives may be
enterprises as well as real estate and personal property, and to accompanied by a maximum of two assistants at a annual general
engage in compatible operations. meeting, but only if the shareholder has notified the company
of the number of assistants in accordance with the preceding
4 § SHARE CAPITAL. paragraph.
The company’s share capital shall not be lower than seven
hundred and fifty thousand (SEK 750,000) and shall not exceed 12 § LOCATION OF ANNUAL GENERAL MEETING.
three million (SEK 3,000,000). The Annual General Meeting may be held in Helsingborg or
Stockholm.
5 § NUMBER OF SHARES.
The number of shares shall be no lower than ten million 13 § ANNUAL GENERAL MEETING.
(10,000,000) and shall not exceed forty million (40,000,000). The Annual General Meeting shall address the following matters:

6 § VPC-REGISTERED COMPANY. 1. Election of the chairperson of the meeting;

The company’s shares shall be registered in a CSD register in 2. Preparation and approval of the voting list;
accordance with the Swedish Central Securities Depositories and 3. Approval of the agenda;
Financial Instruments (Accounts) Act (1998:1479). 4. Election of one or two persons to verify the minutes;
5. Determination of whether the meeting has been duly con-
7 § FINANCIAL YEAR. vened;
The company’s financial year will comprise 1 January - 31 6. Presentation of the annual report and the auditors’ report,
December. and, where appropriate, the group audit report;
7. Resolution to adopt the income statement and balance
8 § BOARD OF DIRECTORS. sheet as well as the consolidated income statement and
The Board of Directors shall consist of at least three (3) and consolidated balance sheet;
not more than eight (8) members with a maximum of three (3) 8. Resolutions on appropriation of the company’s profit or loss
deputies. Board members will be elected annually at the Annual according to the adopted balance sheet;
General Meeting for the period extending until the close of the 9. Resolution to discharge members of the Board of Directors
next Annual General Meeting. and the Chief Executive Officer from liability;
10. Determination of the number of board members and dep-
9 § AUDITOR. uties, as well as, where appropriate, auditors and deputy
The firm shall have at least one (1) and no more than two (2) auditors;
auditors, without or with no more than one (1) deputy auditor. An 11. Establishment of remuneration to the Board of Directors and
authorized public accountant or a registered auditing firm shall be the auditors;
appointed auditor and, where appropriate, deputy auditor. 12. Election of members of the board and any deputy board
members as well as, where appropriate, auditors and any
10 § NOTICE OF ANNUAL GENERAL MEETING. deputy auditors; Other items brought before the general
Notice of Annual General Meeting shall be given in the Swedish meeting according to the Swedish Companies Act or the
Official Gazette (Post- och Inrikes Tidningar) as well as on the Articles of Association.
company’s website. It shall be advertised in Svenska Dagbladet or,
if publication is cancelled, in Dagens Industri instead, that notice These articles of association were adopted by the Annual General
of the meeting has been given. Meeting on 27 April 2020.
150 ANNUAL GENERAL MEETING

Annual General Meeting

The annual general meeting of Nederman Holding AB (publ) will submit a power of attorney in original form with their registra-
take place on Monday, 24 April 2023 at 5:00 p.m. at Clarion Hotel tion. Representatives of a legal entity must present a copy of the
Sea U, Kungsgatan 1, Helsingborg. authenticated registration certificate or equivalent authorisation
documents showing the authorised signatory of the entity.
Registration and participation
Shareholders who wish to attend this Meeting must: The Company will provide proxy forms to shareholders who so
wish. The form is also available for downloading on Nederman’s
■ be registered in Euroclear Sweden’s share register no later website www.nedermangroup.com.
than Friday, 14 April 2023.
■ and notify their participation in the Meeting on Tuesday, In order to be entitled to participate in the annual general meeting,
18 April 2023. a shareholder whose shares are registered in the name of a nomi-
nee must, in addition to giving notice of participation to the annual
Registration must be made in one of the following ways: general meeting, register its shares in its own name so that the
■ by email: [email protected] shareholder is recorded in the share register as of Friday,
■ by phone: +46 (0)42 18 87 00 14 April 2023. Such registration may be temporary (so-called
■ by post: Nederman Holding AB (publ), voting rights registration), and request for such voting rights
“Annual General Meeting”, Box 602, SE-251 06 Helsingborg. registration shall be made to the nominee in accordance with the
nominee’s routines at such a time in advance as prescribed by the
Registration should include name, personal/corporate identity nominee. Voting rights registrations that have been made by the
number, address, telephone number and any advisers. This infor- nominee no later than Tuesday, 18 April 2023 will be taken into
mation will only be used for registering and preparing the voting account in the presentation of the share register.
list. Shareholders who wish to be represented by proxy must

Dividend
The Board of Directors proposes a dividend of SEK 3.75 (3.50) per
share for the 2022 financial year.

Distribution policy
The printed version of Nederman’s Annual Report will be distribut-
ed to those shareholders who have specifically requested a copy.
The Annual Report is also available in its entirety on the group’s
website: www.nedermangroup.com

Financial calendar
■ Quarter 1 report, 24 April 2023
■ Quarter 2 report, 14 July 2023
■ Quarter 3 report, 23 October 2023
    151

Nederman in motion

As a globally leading environmental technology company,

we create value for our customers, the world and our
owners. We are constantly on the move and our task is
clear: to protect people, planet and production. Take a
deep breath, sit back and watch how we do it.

Strategy Interview, Sven Kristensson

The Breath – The Clean Air Company – Q4 and full-year 2022

Breathing clean air With a clear agenda we Stable finish

is a prerequisite create growth and shape to the year
for life. the future for clean air.

NEDERMAN’S YOUTUBE CHANNEL

www.youtube.com/users/nedermanvideos

The Breath > To see the films, scan the QR-code using your mobile or
visit our YouTube channel.

An exhibition arranged by
Nederman with internation-
al photographers, artists,
researchers and activists
showing photographic works
based on the importance of
breath and the air that we
breathe.
152   

Nederman Holding AB (publ)

P.O. Box 602, SE-252 28, Helsingborg, Sweden
Visiting address: Sydhamnsgatan 2, Helsingborg, Sweden
Phone: +46 42 18 87 00
www.nedermangroup.com