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First half year 2010 Industrivärden, July 5, 2010 PowerPoint Presentation
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First half year 2010 Industrivärden, July 5, 2010

First half year 2010 Industrivärden, July 5, 2010

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First half year 2010 Industrivärden, July 5, 2010

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  1. “Long-term industrial developer of listed Nordic companies” First half year 2010 Industrivärden, July 5, 2010

  2. Company in brief • Established: 1944 • Stock: Listed on NASDAQ OMX Nordic, Stockholm • Market cap: Approx. EUR 3.4 bn (SEK 33 bn) • Free float: Approx. 40% of shares • Rating: S&P; A/stable/A-1 • No. shareholders: 50,000 • Average daily trading vol.: Approx. 210,000 Class A-shares 570,000 Class C-shares • Coverage (selection): Handelsbanken Markets, Jaan Köll +46 8 710 1000 SEB Enskilda Securities, Petter Hjertstedt, +46 8 52 2295 00 Goldman Sachs, Markus Iwar +44 20 7552 1264 UBS Nordic, Olof Cederholm +46 8 453 73 00 Credit Suisse, Leo Vicars, +44 20 7888 12 53 Deutsche Bank, Hans Derninger, +46 8 463 55 00

  3. – Long-term industrial developer of listed Nordic companies Ericsson Volvo SSAB Sandvik SCA Skanska

  4. Strong base for value creation Our competitive advantages Our portfolio Holding Market value, Portfolio Share of SEK bn share, % votes, % Sandvik 13.4 23 11.8 Handelsbanken 12.1 21 10.3 Volvo 7.1 12 10.4 SCA 6.5 11 29.4 Ericsson 6.5 11 13.6 SSAB 6.0 10 22.6 Skanska 3.5 6 27.6 Indutrade 2.5 4 36.8 Höganäs 0.7 1 8.1 Munters 0.5 1 14.6 Total AUM 58.9 100 Long-term active ownership Blue-chip portfolio Leveraged influence Extensive structural capital As per June 30, 2010 Our rating Standard & Poors: A/stable/A–1  A strong, competitive long-term track record with limited risk

  5. Focused strategy Strong value potential and long-term perspective Conditions Portfolio Scope: Concentrated portfolio – focus Sectors: Sector generalist Business models: Geographically scalable Cash generation: Good ability Ownership Major owner with board representation Evaluation horizon: 5-8 years Requirement: Strong potential for value creation Individual investments Market value: Large and midcap companies Type: Listed stocks Geography: Nordic companies Business cycle: Expansion or management phase Exit: Appropriate exit once target value has been achieved

  6. 6M:2010 in brief • Net asset value SEK 46.3 bn, or SEK 120/share  increase of SEK 3.5 bn, or 11% for the year to date* • Total return of 3% for the A-shares and 5% for the C-shares  the return index was 7% • In May, Volvo A-shares at an amount of SEK 800 M were purchased in a share swap at an average price of SEK 63 per share • Net share purchases totaled SEK 2.1 bn • In January a convertible loan worth SEK 5 bn was issued *Including reinvested dividends.

  7. Equities portfolio Net debt Net asset value Debt-equity ratio Debt-equity ratio after full conversion Net asset value SEK per share SEK billion Dec. 31 2008 90 -28 62 • Dec. 31 • 2009 • 139 • -28 • 111 June 30 2010 58.9 -12.6 46.3 21% 14% Dec. 31 2009 53.5 -10.8 42.8 20% - Dec. 31 2008 34.7 -10.8 23.9 31% - • June 30 • 2010 • 153 • -33 • 120

  8. Why invest in Industrivärden? The average annual excess return for last ten years was 1%-pt/year Total Return (Index) 234 Industrivärden 180 140 Return Index 100 60 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 As per June 30, 2010

  9. Active ownership in brief Focus on value enhancement drivers: strategy, development and positioning Board participation Company, competitors and industry Analyst presentations Megatrends In-depth analysis Nominating committee participation Company visits Value creation Ownershipagenda incl. action plan Database monitoring Direct dialog with company management AGM participation

  10. Active ownership in practice SSAB Handelsbanken • New market-oriented organization. • Cost-cutting program has had faster impact than planned. • Acquisition of IPSCO’s North American steel mills and coming capacity investments in North America strengthen position as leading player and enable continued global expansion. • Consistently applied business model. • Organic growth in home markets in the Nordic countries and the UK. • Strong financial and market position in a turbulent environment. Ericsson • Strong position ahead of operators’ investments in next generation of telecom systems (LTE) • Favourable growth in Services segment. • Acquisition of Nortel’s U.S. mobile systems business, together with central customer contracts, makes Ericsson a leader also in North America. Sandvik • Consolidation of completed acquisitions. • Restructuring program designed to adapt costs and production capacity to market situation. SCA Skanska • Focus on profitable growth with strong brands in hygiene segment. • Efficiency improvement measures in packaging operations. • Extensive restructuring in product portfolio. • Efficient construction operation generates good cash flows. • Proven model for value-creating project development. • Strategic focus on environmentally adapted, energy-efficient solutions. Munters Höganäs • Strong focus on collaboration withcustomers in new product development. • Acquisition of U.S. powders business. • Strong measures reduce working capital. • Strong global position in selected niches. • Stronger focus through the divesture ofthe MCS operation. • Organic and acquisition-driven growth via gradual broadening of product portfolio. Indutrade • Continued company acquisitions. • Decentralized business model. • Establishment in new geographic markets. • Strong position in energy segment.

  11. Our portfolio of blue-chip companies 7.1 6.5 13.4 12.1 Through innovative, custom-tailored product development and high quality, the company has a world-leading position in commercial transport solutions Through a niche focus and strong position in R&D, the company has built up a world-leading position in materials technology with products primarily in the manufacturing and mining industries A decentralized branch operation with local customer responsibility has resulted in high level of customer satisfaction and enables good profitability The leading European manufacturer of personal care products, with rapidly growing niche products, as well as packaging solutions 11% 23% 12% 21% 6.5 6.0 3.5 2.5 Uniqe, comprehensive know-how in construction combined with process focus has resulted in a leading construction company with value-creating project development By combining sales of industrial consumables with strong organic growth and a well-developed model for acquisition-based growth, the company has been able to show impressive profitability The market’s largest and most profitable supplier of mobile telecom systems, with a leading position in telecom development World-leading position in the niche segment of quenched steels and advanced, high-strength sheet creates solid base for growth and high profitability 6% 4% 11% 10% Marketvalue SEK bn 0.7 0.5 Market leader in the growing niche of metal powders, used primarily for component manufacture in the auto industry Portfolio value: SEK 58.9 bn Strong global position in a business area with major growth potential organically as well as through further development of products and application areas Portfolio share, % 1% 1% As per June 30, 2010

  12. Strong financial position Net debt-equity ratio Interest bearing net debt (SEK bn) SEK 12.6 bn 21% June 30 Dec 31 Dec. 31 SEK bn 2010 2009 2008 Listed stocks 59 54 35 Net debt -13 -11 -11 Net debt eq. ratio 21% 20% 31% Net debt eq. ratio a. full conversion 14% - - S&P rating : A/stable/A–1

  13. High dividend yield Bonus dividend Ordinary dividend SSEX dividend yield Dividend yield 3.4% 2.8% Dividend: 4.20 4.18 2.90 2.75 3.00 3.50 4.50 5.00 4.50 3.00 SEK/share Of which ordinary 2.50 2.50 2.50 2.75 3.00 3.50 4.50 5.00 4.50 3.00

  14. Industrivärden online Reuters code INDUa.ST Bloomberg code INDUA SS  www.industrivarden.net  info@industrivarden.se  +46-8-666 64 00  +46-8-661 46 28  Box 5403, SE-114 84 Stockholm, Sweden