Elanders : Q4 2022

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ELANDERS | YEAR-END REPORT 2022

Delivering sustainable solutions

FROM END

TO END AND

BEYOND

Elanders is a global logistics company with a broad range of services of integrated solutions in supply chain management.

The business is mainly run through two business areas, Supply Chain Solutions and Print & Packaging Solutions. Sustainability aspects permeate Elanders' work on all levels. Essentially, Elanders' operations are all about optimizing the customers' flow of goods in the best possible way while minimizing costs and climate impact.

The Group has approximately 7,000 employees and operates in some 20 countries on four continents. The most important markets are China, Germany, Singapore, Sweden, the United Kingdom and the USA. Major customers are active in the areas Automotive, Electronics, Fashion & Lifestyle, Health Care & Life Science and Industrial.

Contents

1. Bulletpoints
2. Comments by the CEO
3. Group

1. Parent Company

1. Other Information

1. Consolidated Financial Statements

1. Quarterly Data
2. Five Year Overview
3. Reconciliation Alternative Performance Measures

1. Parent Company's Financial Statements
2. Financial Definitions

This document is a translation of the Swedish original. In the event of any discrepancies between this translation and the Swedish original, the latter shall prevail.

Further information can be found on Elanders' website www.elanders.com or requested via e-mail [e-mail]. Questions concerning this report can be addressed to:

Magnus Nilsson	Andréas Wikner
President and CEO	Chief Financial Officer
Phone: [phone]	Phone: [phone]

Elanders AB (publ) (Company ID 556008-1621) Flöjelbergsgatan 1 C, 431 35 Mölndal, Sweden Phone: [phone]

This information is information that Elanders AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 13:00 CET on 23 January 2023.

	NET SALES, MSEK
Q	Q	Q	Q

ADJUSTED EBITA, MSEK

Q	Q	Q	Q

OPERATING CASHFLOW, MSEK

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-
-
-
Q	Q	Q	Q

2 ELANDERS | Q4 2022

BULLETPOINTS

Full year 2022

• Net sales increased to MSEK 14,974 (11,733), which corresponded to an organic growth of six percent, excluding acquisitions and using unchanged exchange rates. Bergen Logistics, that was acquired in the end of last year, had a strong organic growth resulting in high double-digit growth figures in the USA.
• Adjusted EBITA increased to MSEK 966 (658) which equaled an adjusted EBITA margin of 6.5 (5.6) and an improvement in the result by 47 percent.
• During the year, one-off items of around net MSEK -26 charged operating profit. These referred primarily to the earlier announced structural measures in Germany as well as the reevaluation of shares in associated companies in connection with a merger during the second quarter.
• Adjusted net result increased to MSEK 499 (348), corresponding to SEK 13.63 (9.60) per share, which equals an improvement by 42 percent.
• Operating cash flow for the period increased to MSEK 1,210 (-105), of which purchase prices for acquisitions was MSEK -44(-1,267).
• The Board proposes a dividend of 4.15 (3.60) kronor per share for 2022.
• Reduction targets have been set for the Group's greenhouse gas (GHG) emissions. This includes, among other things, a reduction of the Group's scope 1 and 2 emissions by 50 percent by 2030.

Fourth quarter 2022

• Net sales increased to MSEK 4,099 (3,364), which corresponded to an organic growth of five percent, excluding acquisitions and using unchanged exchange rates. Bergen Logistics continued to have strong organic growth in the USA resulting in double-digit growth figures.
• Adjusted EBITA increased to MSEK 331 (244), which equaled an adjusted EBITA margin of 8.1 (7.3) percent and an improvement in the result of 36 percent.
• During the period, one-off items of MSEK -58 charged the operating result. These referred to the earlier announced action plan in Germany as well as provisions for an additional consideration for an acquisition that has developed better than expected.
• Adjusted net result increased to MSEK 184 (136), corresponding to SEK 5.11 (3.73) per share, which equals an improvement by 37 percent.
• Operating cash flow increased to MSEK 495 (-680), of which purchase prices for acquisitions were MSEK 1 (-1,153).

FINANCIAL OVERVIEW

	Full year			Fourth quarter
	2022	2021	2022	2021
Net sales, MSEK	14,974	11,733	4,099	3,364
EBITDA, MSEK	1,940	1,468	538	456
EBITDA excl. IFRS 16, MSEK	1,068	770	306	266
EBITA adjusted, MSEK 1) 3)	966	658	331	244
EBITA-margin adjusted, % 1) 3)	6.5	5.6	8.1	7.3
EBITA, MSEK 1)	940	641	273	228
EBITA-margin, % 1)	6.3	5.5	6.7	6.8
Result after tax adjusted, MSEK 3)	499	348	184	136
Earnings per share adjusted, SEK 3)	13.63	9.60	5.11	3.73
Result after tax, MSEK	487	331	140	120
Earnings per share, SEK	13.29	9.12	3.87	3.28
Operating cash flow, MSEK	1,210	-105	495	-680
Net debt, MSEK	7,276	5,249	7,276	5,249
Net debt excl. IFRS 16, MSEK	3,022	2,539	3,022	2,539
Net debt/EBITDA ratio, times 2)	3.7	3.6	3.4	2.9
Net debt/EBITDA ratio adjusted, times 2) 4)	2.8	3.2	2.1	2.3

1. EBITA refers to operating result plus amortization of assets identified in conjunction with acquisitions.
2. Return ratios have been annualized (the result has been recalculated to correspond to the result for a 12-month period).
3. One-offitems have been excluded in the adjusted measures.
4. Net debt/EBITDA ratio adjusted excludes IFRS 16 effects and one-off items.

ELANDERS | Q4 2022 3

COMMENTS BY THE CEO

We are very pleased to have delivered an adjusted result in the fourth quarter that is clearly better than last year and our best full-year result ever. This despite the challenging circumstances in the world.

Business area Supply Chain Solutions continues to improve its result in combination with higher margins. As a step in further improving our margins we have decided to close

unprofitable sections of our road transportation operations in Germany. We will also reduce the buy and sell business, which will improve our margins additionally. Both of these measures will lower net sales over the coming year by about MSEK 500, but at the same time, this will increase our operating result, improve our margins and release capital.

If we look at demand in Supply Chain Solutions it continued to be generally good during the fourth quarter, even though demand in certain product areas like TVs, computers and household appliances was weaker for our customers than in previous years. On the other hand, the demand for products associated with heating and reducing electricity consumption continued to be very high. Demand

in Fashion & Lifestyle fell somewhat in Europe but rose in North America. Regarding Asia, we saw a decline in demand for value- added services in Electronics. We expect this situation to progressively improve now that China has reduced COVID-19 restrictions. In general, there is a continued high level of extra warehousing of many different kinds of products. This indicates an overall drop in demand where retail is not inclined to receive further deliver- ies. In the short term, this is favorable for a logistics company like Elanders that manages customers' products and inventory because it entails more efficient use of our facilities.

Our other business area, Print & Packaging Solutions, continued on the road to recovery and delivered a fourth quarter that was clearly better than last year. During the quarter we experienced a strong upswing for both existing and new customers in online print. This is the primary source of the improved result. We also saw positive effects of the price increases we implemented and that access to materials is stabilizing.

The market continues to be very challenging with low visibility concerning future demand. High inflation, interest rate hikes and the high price of energy will most likely impact consumption

going forward. The pandemic put a spotlight on how vulnerable the global supply chain is. This is particularly apparent when combined with global just-in-time deliveries. We're beginning to see signs of customers making changes in their supply chains. The most prominent is a larger portion of components being purchased from countries closer to them. A good example of this is that car manufacturers in Europe are buying more components from other European countries to reduce their dependency on Asia. This ought to benefit Elanders since we have a strong presence in Europe. Another example is some computer manufacturers signaling that they intend to stop using chips made in China by 2024. The global supply chain as we know it today may be transformed.

Despite a very complex environment we delivered a result that is clearly better than last year. Our strategy to continually try to broaden our customer base to more industries and increase our geographic reach has created a more robust Elanders better equipped to handle fluctuations in demand. In recent years, we've also worked intensively to map our GHG emissions and structure our work in sustainability throughout the Group. I'm therefore very pleased that we can now, as a result of this work, present reduction targets for both the medium and long term where the end goal is to, by 2050, reach "net zero" in the entire value chain.

Magnus Nilsson

President and Chief Executive Officer

4 ELANDERS | Q4 2022

GROUP

Elanders offers a broad range of services and total solutions in supply chain management. The business is run through two business areas, Supply Chain Solutions and Print & Packaging Solutions. The Group has approximately 7,000 employees and operates in some 20 countries on four continents. Our most important markets are China, Germany, Singapore, Sweden, the United Kingdom and the USA. Our major customers are active in the areas Automotive, Electronics, Fashion & Lifestyle, Health Care & Life Science and Industrial.

NET SALES AND RESULT

Full year

Net sales increased by MSEK 3,061 to 14,794 (11,733) compared to the same period last year. Cleared of exchange rate fluctuations and acquisitions, net sales increased by six percent. The organic growth was primarily generated by the European division of Supply Chain Solutions. Demand from customers continued to be good during the period, even if some customers in Automotive and Industrial still suffered disruptions in production due to the shortage of components and raw material. Bergen Logistics, which was acquired in the end of 2021, had strong organic growth resulting in high double- digit growth figures, but this is not reported in its entirety as organic growth for the Group.

Adjusted EBITA, i.e. the operating result adjusted for amortization of assets identified in conjunction with acquisitions and one-off items, increased by MSEK 308 to MSEK 966 (658). Changes in exchange rates compared to the same period last year had a positive effect on EBITA by about MSEK 47. If one-off items are included, EBITA increased from MSEK 641 to 940.

The period's one-off items amounted to net MSEK -26 (-17). These mainly consisted of a reevaluation of the shares in the associated company LOGworks, which affected the result in the second quarter positively by around MSEK 50, as well as the action plan earlier announced in the fourth quarter, which entailed one-off item costs of MSEK -48. In addition to these items, provisions were made for an additional consideration for an acquisition that has developed better than expected. Last year's one-off items referred to costs in conjuncture with acquisitions.

The improvement in the result compared to the previous year was mainly associated with business area Supply Chain Solutions. The increase was primarily generated by the acquisitions made in the second half of last year. Air & Sea operations in Europe in the same business area also contributed to the improvement of the result. Component and material shortages, price hikes in general, high levels of sick leave at the beginning of the year and the war in Ukraine have had negative effects on the result and profitability,

as well as China's previous zero tolerance concerning COVID-19 outbreaks has had.

Higher net debt and higher interest rates also had a growing impact on the income statement where interest rate costs have increased considerably compared to last year.

Fourth quarter

Net sales increased by MSEK 735 to 4,099 (3,364) compared to the same period last year. Cleared of exchange rate fluctuations and acquisitions, net sales increased by five percent. The organic growth

was generated in part by the buy and sell business in Asia regarding components for customers in the customer segment Electronics. Bergen Logistics, which was acquired in 2021, also contributed to the organic growth.

Demand during the quarter has been good, but varied from month to month between both different product groups and geographically. Some customers in Automotive and Industrial still suffered disruptions in production due to the shortage of components and raw material. Other customers have begun to experience a decline in demand from consumers, for example in TVs, computers and household appliances. High prices for electricity, food and fuel are believed to be the cause of this. At the same time, demand grew for heat pumps and other equipment that has to do with heating. Overall, demand from the Group's customers in Europe and North America continues to be good but is slightly declining in Asia.

Adjusted EBITA, i.e. the operating result adjusted for amortization of assets identified in conjunction with acquisitions, increased by MSEK 87 to MSEK 331 (244). Changes in exchange rates compared to the same period last year had a positive effect on EBITA by about MSEK 19. If one-off items are included, EBITA increased from MSEK 228 to 273.

The period's one-off items amounted to net MSEK -58 (-16). These refer to the earlier announced action plan in Germany as well as further provisions regarding an additional consideration for an acquisition that has developed better than expected. Last year's one- off items referred to costs in conjuncture with acquisitions.

Higher net debt and higher interest rates also had a growing impact on the income statement, where interest rate costs have increased considerably compared to the same period last year.

ELANDERS | Q4 2022 5