Slide 1: Interim Report Fourth Quarter 2022
INTERIM REPORT FOURTH QUARTER 2022
Slide 2: Summary Q4
SUMMARY Q4 11% Revenue growth at STRONG REVENUE GROWTH, AT FIXED EXCHANGE RATES, OF 11% fixed exchange rates • Overall stable demand for the Group, and strong revenue growth • Total order intake growth was 15%, and at fixed exchange rates 3%, of which organic -2% • Total revenue growth was 23% and a
Slide 3: Staying Ahead Through Innovation
STAYING AHEAD THROUGH INNOVATION CAMBRIO LAUNCHES 2023 VERSIONS • GibbsCAM 2023 features significant Turning enhancements including the highly effective implementation of Sandvik Coromant’s PrimeTurning™ to permit turning and facing in all directions for dramatic increases in high volume production.
Slide 4: Global Population of Autonomous Equipment
GLOBAL POPULATION OF AUTONOMOUS EQUIPMENT % SHARE OF TOTAL POPULATION, BY OEM 7% • Based on industry interviews in GlobalData’s report, the 8% total global population of tele remote and autonomous 17% LHDs and underground mining trucks is 890 68% • Australia, Canada and United States are the three m
Slide 5: YoY Market Development
YOY MARKET DEVELOPMENT Mining Engineering Automotive Energy Infrastructure Aerospace Percent of 48% 22% 7% 2% 11% 3% revenue 2022 Percent of Q4 Y/Y* revenue 2022 order intake EUROPE 27% +3% NORTH AMERICA 25% +5% ASIA 19% +10% AFRICA AND MIDDLE EAST 12% -2% AUSTRALIA 12% -1% SOUTH AMERICA 7% -22% (Co
Slide 6: Order Intake and Revenues
ORDER INTAKE AND REVENUES MSEK 35,000 120,000 ORDER INTAKE 30,000 110,000 REPORTED (SEK M) 100,000 25,000 90,000 30,751 20,000 80,000 15,000 70,000 60,000 10,000 REVENUES 5,000 10,000 REPORTED (SEK M) 0 Q1 Q2 2018* Q3 Q4 Q1 Q2 2019* Q3 Q4 Q1 Q2 2020* Q3 Q4 Q1 Q2 2021* Q3 Q4 Q1 Q2 2022 Q3 Q4 0 31,094
Slide 7: Growth in Order Intake and Revenues
GROWTH IN ORDER INTAKE AND REVENUES ORDER INTAKE REVENUES MSEK MSEK 50% 130,000 50% 120,000 40% 120,000 40% 110,000 30% 110,000 30% 100,000 20% 100,000 20% 90,000 90,000 10% 10% 80,000 80,000 0% 0% -10% -10% -20% -20% -30% -30% -40% -40% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Slide 8: Adjusted EBITA Development
Adj. EBITA margin: ADJUSTED EBITA DEVELOPMENT 20.6% MSEK 7,000 +27% 24% • Adj. EBITA SEK 6,413 M (5,043) 6,000 • Margin 20.6% (19.9) 20% 5,000 16% • Leverage: 4,000 12% • Inflation mitigated by pricing 3,000 • Negatively impacted by inventory 8% obsolescence provision due to 2,000 logistics disturba
Slide 9: Mining and Rock Solutions
51%SHARE OF REVENUES 2022 MINING AND ROCK ORDER INTAKE AND REVENUES MSEK SOLUTIONS 20,000 150% ORDER INTAKE 16,000 100% • Stable demand at high level with solid order levels and all-time high 12,000 revenues 8,000 50% • Total order intake growth was 12% and at fixed exchange rates, 4,000 growth was
Slide 10: Rock Processing Solutions
8% SHARE OF REVENUES 2022 ROCK PROCESSING ORDER INTAKE AND REVENUES MSEK SOLUTIONS 3,000 150% ORDER INTAKE 2,000 100% • Order intake growth driven by aftermarket and acquisitions, with revenues at record levels 1,000 50% • Total order intake grew by 30% and at fixed exchange rates 18%, 0 0% of which
Slide 11: Manufacturing and Machining Solutions
41% SHARE OF REVENUES 2022 MANUFACTURING AND ORDER INTAKE AND REVENUES MSEK MACHINING SOLUTIONS 12,000 150% ORDER INTAKE 8,000 100% • Stable order intake levels with positive development in North America and Europe driven by automotive 4,000 50% • Total order intake growth of 16%, at fixed exchange
Slide 12: Cecilia Felton, CFO
CECILIA FELTON CFO 12
Slide 13: Financial Summary
FINANCIAL SUMMARY MSEK Q4 2021* Q4 2022 GROWTH OI REV. ORGANIC -2% 5% ORDER INTAKE 26,772 30,751 STRUCTURE 5% 5% REVENUES 25,311 31,094 ORG + STR 3% 11% ADJUSTED EBITA 5,043 6,413 CURRENCY 12% 12% ADJUSTED EBITA MARGIN 19.9% 20.6% TOTAL 15% 23% NET FINANCIAL ITEMS -23 -390 TAX RATE EXCLUDING IAC 27.
Slide 14: Bridge Analysis
GROUP LEVERAGE: BRIDGE ANALYSIS Q4 Q4 MSEK 2021* ORGANIC CURRENCY** STRUCTURE 2022 REVENUES 25,311 1,211 3,193 1,380 31,094 ADJUSTED EBITA 5,043 2 1,096 271 6,413 ADJUSTED EBITA MARGIN 19.9% 0% 20.6% ACCRETION/DILUTION -0.9% 1.6% 0.0% * Best estimates excluding SMT ** Currency effect net of structur
Slide 15: Net Financials
NET FINANCIALS SEK Q4 2021 Q4 2022 • Interest net increase due to increased borrowed INTEREST NET -88 -416 volumes PENSION -27 -21 BANK CHARGES -22 -17 OTHER FINANCIAL INCOME AND COST -39 -94 LEASES IFRS16 -34 -54 FX AND OTHER ASSET CLASSES 186 213 TOTAL -23 -390 * Best estimates excluding SMT 15 SA
Slide 16: Tax Rate
TAX RATE Q4 2021 Q4 2022 FY 2022 • The higher tax rate in both current REPORTED 27.7% 28.0% 27.5% and comparative period relates to adjustments of non-recurring EXCLUDING IAC 27.4% 27.7% 25.4% transactions for the specific quarter NORMALIZED 24.0% 25.4% 24.1% • The normalized tax rate was higher due
Slide 17: Net Working Capital
NET WORKING CAPITAL NET WORKING CAPITAL MSEK 35,000 40% 30,000 35% 25,000 30% 20,000 15,000 25% • Slight increase in inventories 20% 10,000 5,000 • NWC underlying slightly down sequentially 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018 2019 2020 2021 2022 NWC % OF REVENUES PE
Slide 18: Free Operating Cash Flow
FREE OPERATING CASH FLOW MSEK 7,000 140% 6,000 120% MSEK Q4 2021 Q4 2022 EBITDA * 5,867 6,603 5,000 100% NON-CASH ITEMS -189 893 4,000 80% NWC CHANGE -333 376 3,000 60% CAPEX ** -871 -1,647 2,000 40% FOCF *** 4,474 6,226 1,000 20% 0 0% * Adjusted for cash items related to certain acquisition costs,
Slide 19: Net Debt
NET DEBT GROUP TOTAL MSEK RATIO 1.5 50,000 • Financial net debt / R12 EBITDA 1.32 40,000 1.2 0.9 30,000 • Financial net debt SEK 36.5 billion 0.6 20,000 0.3 10,000 • Net debt SEK 44.0 billion 0.0 0 -0.3 -10,000 -0.6 -20,000 -0.9 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018 2019 2
Slide 20: Outcome Versus Guidance
OUTCOME VERSUS GUIDANCE Outcome Guidance Quarterly Underlying currency yoy effect (MSEK) 1 096 1 400 Capex (BSEK) 4.2 4.0 Annually Interest net (BSEK) -0.9 -0.7 Normalized tax rate (%) 24.1% 22-24% 20 SANDVIK: Interim report on the fourth quarter 2022 Comments and numbers refer to continuing operati
Slide 21: Guidance Q1 and FY 2023
GUIDANCE Q1 AND FY 2023 CAPEX (CASH) Estimated to approx. SEK 4.5 B for 2023. CURRENCY Given currency rates at end of December 2022 the effect on operating profit from transaction and EFFECTS translation would be SEK +600 M for Q1 2023 INTEREST NET Underlying interest net is estimated to approximate
Slide 22: Conclusion
CONCLUSION SOLID EXECUTION 2022 IN A CHALLENGING ENVIRONMENT • Favorable demand and solid contribution from acquisitions led to order intake growth of 17% • Strong backlogs with well managed supply chain issues and acquisitions resulted in a strong 20% growth in revenues • Adjusted EBITA at an all-t
Slide 23: Q&A
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Slide 24: Back-up Slides
BACK-UP SLIDES SANDVIK P|
Slide 25: Segment Bridge Analysis
Q4 Q4 MSEK 2021 ORGANIC CURRENCY STRUCTURE 2022 MINING AND ROCK SOLUTIONS REVENUES 13,186 975 1,745 249 16,156 ADJUSTED EBITA 2,825 16 608 108 3,557 ADJUSTED EBITA MARGIN 21.4% 22.0% ROCK PROCESSING SOLUTIONS REVENUES 2,129 107 288 461 2,985 ADJUSTED EBITA 340 -49 123 63 476 ADJUSTED EBITA MARGIN 16
Slide 26: Loan and Duration Profile
LOAN AND DURATION PROFILE AMOUNT DURATION LONG TERM Swedish MTN -500 1.1 years 82% European MTN Bank Loans -29,731 -8,090 4.8 years 3.1 years SHORT TERM Commercial Paper -7,287 0.1 years Swedish MTN -500 1.0 years 18% European MTN Bank Loans -781 -66 0.5 years 0.0 years TOTAL -46,954 3.6 years Commi
Slide 27: Loan Maturity Profile
LOAN MATURITY PROFILE AVERAGE MSEK INTEREST RATE: ~3.0% 12,000 10,000 8,000 6,000 4,000 2,000 0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 27 SANDVIK: Interim report on the fourth quarter 2022 Comments and numbers refer to continuing operations unless otherwise stated.
Slide 28: Disclaimer Statement
DISCLAIMER STATEMENT “Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially affected by other factors for example, the effect of economic conditions, exchange-rate