Interim Report January 1 – March 31, 2001

Listed portfolio  
Value at April 30, 2001: SEK 45,331 M
Change in value since start of year: -17%, General Index -10%
Value at March 31, 2001: SEK 40,826 M
Value at December 31, 2000: SEK 54,961 M
   
   
Net asset value  
As per April 30, 2001: SEK 237 per share and CPN
As per March 31, 2001: SEK 214 per share and CPN As per
December 31, 2000: SEK 283 per share and CPN
   
   
The stock  
Price trend as per April 30, 2001: -7%, General Index -10%

 

NET SALES AND EARNINGS 1)
Consolidated net sales amounted to SEK 1,433 M (1,094), which for comparable units represents an increase of 9 percent compared with the corresponding period in 2000. Net financial items amounted to SEK -94 M (-19). Earnings after financial items totaled SEK 189 M (347). Earnings included capital gains of SEK 181 M (270) on sales of listed stocks.

FINANCING AND EQUITY RATIO
Interest-bearing net debt increased by SEK 194 M, to SEK 5,857 M.

The visible equity ratio was 63 percent (65 percent at the start of the year), while the adjusted equity ratio, which includes surplus values of listed stocks, was 82 percent (87).

PORTFOLIO OF LISTED STOCKS

The portfolio of listed stocks had a market value of SEK 40,826 M on March 31 (SEK 54,961 M at the start of the year), and the surplus value was SEK 22,871 M (SEK 36,935 M at the start of the year). Adjusted for purchases and sales, the change in value since the start of the year was -25 percent, compared with -18 percent for the General Index. Sales from the portfolio of listed stocks generated capital gains of SEK 181 M.

During the first three months of the year, purchases of listed stocks totaled SEK 193 M and sales totaled SEK 521 M. Thus stocks were sold for a net value of SEK 328 M. Major purchases consisted of 350,000 Pharmacia Corp., and major sales consisted of 1,000,000 Skanska, 160,000 Karo Bio and 250,000 Handelsbanken.

The number of shares held in Lundbeck A/S increased during the first quarter as a result of a 4:1 split effected on March 30.

Price Trend for the Largest Shareholdings
The trend during the first quarter for the largest shareholdings, which accounted for 87 percent of the portfolio’s value as per March 31, was as follows:

  Share of portfolio Price change
     
Stock value as per March 31, % January-March, %
Ericsson 27 -45
Handelsbanken 18 -8
Skandia 11 -40
     
Sandvik 11 -17
SCA 10 5
Pharmaceuticals 10 -5
     

Ericsson performed worse than the General Index, but essentially on a par with other telecom companies on the Stockholm Stock Exchange and foreign bourses. Like most of its competitors, Ericsson has experienced a sharp drop in demand and decreasing margins in its systems business. At the same time its earnings continue to be burdened by problems in the consumer products segment. An extensive program to reinstate good profitability is in progress. A collaboration with Sony in the consumer product segment has also been initiated.

Handelsbanken continues to report clearly higher profitability than the average for other banks on the Stockholm Stock Exchange. Its stock outperformed the General Index as well as the bank & financial services index and other Nordic commercial banks.

Skandia was affected by the weak economic trend in the U.S., which is the company’s largest market. Skandia’s stock performed worse than the General Index. A slight recovery was noted in April.

Sandvik performed on a par with the General Index during the first quarter as well as during the full-year 2000.

SCA outperformed the General Index as well as the forestry index.

Industrivärden’s pharmaceutical holdings (Lundbeck A/S, Pfizer Inc. and Pharmacia Corp.) performed better than the General Index.

Development for the Listed Portfolio Through April 30, 2001
The market value of the listed portfolio on April 30 was SEK 45,331 M, and the surplus value was SEK 27,400 M. Adjusted for purchases and sales, the portfolio’s value decreased by 17 percent from the start of the year. The General Index decreased by 10 percent during the same period.

PARENT COMPANY
The Parent Company’s dividend income amounted to SEK 17 M (15), including SEK 5 M (2) from listed companies. Including gains of SEK 181 M (270) on sales of listed stocks, administrative costs of SEK -20 M (-18) and a negative balance of financial items, totaling SEK -86 M (-30), earnings after financial items totaled SEK 92 M (241).

SUBSIDIARIES
Besam’s net sales amounted to SEK 489 M (448), an increase of 9 percent compared with the first quarter of 2000. Earnings after financial items were SEK 40 M (45).

Isaberg Rapid’s net sales totaled SEK 180 M (175), which for comparable units was on a par with the first quarter of 2000. The joint-venture company in China is consolidated in the Group starting in 2001. Earnings after financial items were SEK 8 M (24).

Indutrade’s acquisition of Fagerberg, EIE Maskin and the Finnish company Tecalemit was approved by the competition authorities in Sweden and Finland in March. The newly acquired companies are included in Indutrade as from January 1, 2001. Indutrade’s net sales amounted to SEK 764 M (471), which for comparable units represents an increase of 11 percent. Earnings after financial items totaled SEK 50 M (36), an increase of SEK 8 M for comparable units.

CALCULATED NET ASSET VALUE

Industrivärden’s net asset value 2) as per March 31 has been calculated at SEK 40.9 billion, or SEK 214 per share and CPN. Net asset value as per April 30 has been calculated at SEK 237 per share and CPN. Net asset value as per December 31, 2000, was SEK 283 per share and CPN.

Stockholm, Sweden, May 3, 2001

Clas Reuterskiöld

President and CEO


ACCOUNTING PRINCIPLES
The new accounting recommendations that took effect on January 1, 2001 have been applied in the interim report. Aside from this the accounting principles and calculation methods used in the 2000 Annual Report have also been used in this interim report.


AUDITORS’ EXAMINATION
This interim report has not been examined by the Company’s auditors.

FINANCIAL CALENDAR
An interim report for the period January–June will be released on August 15.
An interim report for the period January–September will be released on October 31.
A year-end report for 2001 will be released on February 15, 2002.

The 2001 Annual Report will be published at the end of March 2002. Industrivärden has ownership stakes in Ericsson, SCA, Skanska, and other companies which amount to at least 20 percent of the number of votes after full dilution (i.e., associated companies). The consolidated income statement and balance sheet presented in this interim report have been prepared in accordance with the acquisition value method. Once complete information from all associated companies is available – however, not later than two months after the end of the reporting period – a complementary income statement and balance sheet, prepared in accordance with the equity method, will be available at Industrivärden and on the company’s website.

The composition of net asset value is shown in the table on page 10.



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