Q3 2018 Presentation October 22, 2018 Our Focus and Offerings We - - PowerPoint PPT Presentation

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Q3 2018 Presentation October 22, 2018 Our Focus and Offerings We - - PowerPoint PPT Presentation

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Q3 2018 Presentation October 22, 2018 Our Focus and Offerings We develop, sell and deliver innovative technical solutions to create superior value by impro roving p perform rmance and reducing r risk . Focus o on products and s services w

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October 22, 2018

Q3 2018 Presentation

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SLIDE 2

Focus o

  • n products and s

services w within: :

  • Fuel and materials testing
  • Fuel and reactor management software
  • Life cycle management of nuclear and radioactive hazards

We develop, sell and deliver innovative technical solutions to create superior value by impro roving p perform rmance and reducing r risk.

Our Focus and Offerings

2018-10-22 Interim Report Third Quarter 2018

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Global Nuclear Power Market

  • Western Europe, the USA and Japan: cost pressure from alternative sources of energy
  • Life extension programs instead of new build
  • Decommissioning of older plants
  • Delayed new build of nuclear plants in Finland, UK and France
  • Germany: phasing out
  • Russia: significant expansion in plans to export Russian nuclear technology with the largest

number of new plant builds planned worldwide

  • China, South Korea, Taiwan: expansion and deployment of nuclear technology
  • China builds a large number of nuclear plants
  • China and Korea plans to export their own nuclear technology globally
  • Korea developing a decommissioning program to phase out Korean nuclear plants
  • Taiwan preparing for decommissioning
  • The Middle East: planning and constructing new nuclear plants
  • UAE building four new reactors
  • Saudi Arabia and Jordan planning new nuclear builds

2018-10-22 Interim Report Third Quarter 2018

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Broaden our services to other industries

  • Using Studsvik extensive experience in the nuclear sector to develop

profitable applications outside the nuclear power market

  • Automated manufacturing and handling of nuclear isotopes used

in medical instruments and industrial applications

  • Waste management of nuclear material associated with the oil

and mining industry (Naturally Occurring Radioactive Material, NORM)

2018-10-22 Interim Report Third Quarter 2018

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July- September 2018 July- September 2017 January- September 2018 January- September 2017 Full year 2017 Sales, SEK million

167.2 183.3 538.6 539.5 704.8

Gross margin,%

24.9 30.8 25.1 25.1 23.5

Operating Profit, SEK million

9.5 15.5 33.7

  • 5.9
  • 41.6

Operating margin, %

5.7 8.5 6.3

  • 1.1
  • 5.9

Profit after net financial items, SEK million

6.1 10.9 22.3

  • 19.3
  • 58.7

Profit per share after tax, SEK

0.55 1.35 1.81

  • 1.83
  • 5.47

Free cash flow, SEK million

  • 0.8
  • 10.4

24.8

  • 53.5
  • 84.2

Investments, SEK million

7.7 2.8 20.8 15.2 22.1

Net debt/Equity ratio, %

22.9 23.1 22.9 23.1 35.1

Average number of employees

632 664 631 668 662

Financial performance

2018-10-22 Interim Report Third Quarter 2018

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2018-10-22 Interim Report Third Quarter 2018

  • Sales SEK 167.2 (183.3) million
  • Gross margin 24.9 (30.8) per cent
  • Operating result SEK 9.5 (15.5) million
  • Restructuring costs SEK 3.8 (0.1) million
  • SEK 13.5 million gain from sale of Horsviks Gård
  • Free cash flow SEK -0.8 (-10.4) million
  • Mixed development in operating results for the quarter
  • Q3 last year included SEK 22 million FBSR license revenue and profit
  • YTD still well ahead of last year with operating result at SEK 33.7 million vs -5.9
  • Reduced head office cost following organizational changes implemented Q4-2017
  • Continued improvement in cash flow

Analysis of key ratio development Q3

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2018-10-22

KEY OFFERINGS – CONSULTANCY SERVICES We manage Radioactive Hazards to keep our customers Safe

Environmental Services

  • Norm

Engineering

– Waste Mgmt Processes

Nuclear Decommissioning

  • Radiological inventory,

characterization & clearance

Repository Optimization

  • Safety Analysis, Licensing

and Planning

Radiation Safety & Protection Radioactive Waste Management

Interim Report Third Quarter 2018

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July- September 2018 July- September 2017 January- September 2018 January- September 2017 Full year 2017 Sales, SEK million

18.8 39.8 59.4 101.5 123.0

Operating Profit, SEK million

  • 8.7

15.5

  • 7.6

15.8 11.3

Operating Profit margin, %

  • 46.3

38.9

  • 12.8

15.6 9.2

Investments, SEK million

0.6 0.2 2.0 1.1 2.7

Average number of employees

54 53 54 58 57

Financial performance – Consultancy Services

2018-10-22 Interim Report Third Quarter 2018

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  • Sales SEK 18.8 (39.8) million
  • Operating profit SEK -8.7 (15.5) million
  • Restructuring costs SEK 2.5 (2.6) million
  • Comparable operating profit -6.2 (18.1)
  • YTD operating profit SEK -7,6 (15,8) million
  • Q3 last year included SEK 22 million FBSR license revenue and profit
  • Drop in net sales reflecting exit from non profitable business in the UK and Sweden
  • Unsatisfactorily results
  • Mikael Karlsson appointed new Business Area President
  • Continued focus on waste treatment technologies, metal treatment technologies and

related engineering services

  • Increased focus on non-IP related consultancy services

Operational highlights – Consultancy Services

2018-10-22 Interim Report Third Quarter 2018

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2018-10-22 Interim Report Third Quarter 2018

KEY OFFERINGS – FUEL & MATERIALS TECHNOLOGY

Fuel & Materials Life Cycle

Transport of Irradiated Materials Final & Interim Storage Research Engineering Fuel Qualification Hot Cell Technologies Plant Life Management

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Financial performance – Fuel- & Materials Technology

2018-10-22 Interim Report Third Quarter 2018

July- September 2018 July- September 2017 January- September 2018 January- September 2017 Full year 2017 Sales, SEK million

40.0 36.0 159.9 140.6 195.0

Operating Profit, SEK million

0.7

  • 3.6

18.4 7.1 5.3

Operating Profit margin, %

1.8

  • 10.0

11.5 5.1 2.7

Investments, SEK million

6.4 1.9 15.7 10.9 13.8

Average number of employees

97 100 97 100 101

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  • Sales SEK 40.0 (36.0) million
  • Operating profit SEK 0.7 (-3.6) million
  • YTD operating profit SEK 18.4 (7.1) million
  • Q3 is vacation season and a soft quarter
  • Efficiency problems in production having negative impact on margin
  • Part of Hot cell facility being rebuilt to accommodate production line for medical

isotopes

  • Continued strong demand for services offered evidenced by strong order intake
  • Cost for recruitment and onboarding continues to burden cost but enabling

future growth

Operational highlights – Fuel & Materials Technology

2018-10-22 Interim Report Third Quarter 2018

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2018-10-22 Interim Report Third Quarter 2018

KEY OFFERINGS - SCANDPOWER Nuclear Analysis Software & Services

Fuel Design, Core Design, Core Monitoring & Plant Performance Optimization Consulting, Engineering Services & Knowledge Transfer Operator Training Simulation Used Fuel Analysis & Management (Interim and Permanent Storage) New and Advanced Reactor Design & Licensing

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Financial Performance – Scandpower

2018-10-22 Interim Report Third Quarter 2018

July- September 2018 July- September 2017 January- September 2018 January- September 2017 Full year 2017 Sales, SEK million

31.2 19.6 97.8 56.4 81.0

Operating Profit, SEK million

1.2

  • 2.7

20.9

  • 9.8
  • 11.8

Operating Profit margin, %

3.8

  • 13.8

21.4

  • 17.4
  • 14.6

Investments, SEK million

0.3 0.1 0.5 0.2 0.7

Average number of employees

32 34 32 34 34

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Operational highlights – Scandpower

2018-10-22 Interim Report Third Quarter 2018

  • Sales SEK 31.2 (19.6) million
  • Operating profit SEK 1.2 (-2.7) million
  • YTD operating profit SEK 20.9 (-9.8) million
  • Acceptable performance in Q3 software sales, maintenance, services and training
  • Full SEK 38 million of TVEL order delivered, SEK 8 million delivered in Q3
  • Work to obtain export approval for certain software to China continues
  • Continued efforts to add application for spent fuel and additional consultancy services
  • Increased and expanded commercial activities opens up new opportunities
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2018-10-22 Interim Report Third Quarter 2018

KEY OFFERINGS - GERMANY Decommissioning and Radiation Safety

Nuclear Decommissioning

  • Radiological inventory,

characterization & clearance

Radiation Safety & Protection

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2018-10-22 Interim Report Third Quarter 2018

Financial Performance - Germany

July- September 2018 July- September 2017 January- September 2018 January- September 2017 Full year 2017 Sales, SEK million

78.3 81.9 219.6 226.6 291.1

Operating Profit, SEK million

2.5 10.7

  • 2.6

0.4

  • 8.4

Operating Profit margin, %

3.2 13.1

  • 1.2

0.2

  • 2.9

Investments, SEK million

  • 0.1

0.0 0.1 0.6 1.4

Average number of employees

423 439 423 439 435

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2018-10-22 Interim Report Third Quarter 2018

Operational highlights - Germany

  • Sales SEK 78.3 (81.9) million
  • Operating profit SEK 2.5 (10.7) million
  • Restructuring costs SEK 0 (2.5) million
  • YTD operating profit SEK -2.6 (0.4) million
  • Q3 results below expectation
  • Parallel revision periods at customer plants created resource constraints at peaks and

excess resources between revisions

  • Market demand is picking up as decommissioning activities are initiated
  • Still slow market by any standards
  • Continued focus on utilization ratio, price and cost control
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Appendix

2018-10-22 Interim Report Third Quarter 2018

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Balance sheet

September 2018 September 2017 December 2017 Assets Non-current assets 475.9 431.8 456.6 Current assets 434.8 419.3 368.3 Total assets 910.7 851.1 824.9 Equity and liabilities Equity 320.4 309.9 288.1 Non-controlling interest 0.3 0.3 0.3 Non-current liabilities 163.7 358.7 364.7 Current liabilities 426.3 182.2 171.8 Total equity and liabilities 910.7 851.1 824.9

2018-10-22 Interim Report Third Quarter 2018

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2018-10-22 Interim Report Third Quarter 2018