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ÅF Group Q2 2017Jonas Gustavsson, CEOStefan Johansson, CFO

ÅF Group Q2, 2017

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9.4%

3%

10%Net Sales

EBITA*

3 231 SEK M

302 SEK M

EBITA margin*

*excl items affecting comparability

Global trends fuel our business

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Globalisation

Digitalisation

Urbanisation and sustainability

Repositioning

Business overview

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Market Segments

10 largest clients

Public/private client

Power

15%

Automotive & Vehicle

16%

Rail & Roads

21%

Real Estate

18%

Life Science, Food &

Pharma

8%

Pulp&Paper

4%

Defence

2%

Telecom

3%

Mining&Steel

Production

2%

Petrocemical

3%

Financial

Services

2%

Other - Mfg primarily

6%

Private

69%

Public

31%

(Volvo Cars and AB Volvo)

Data FY 2016

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Highlights Q2New projects Acquisitions

• Industrial project for a flexible production system at LKAB

• Koncept Stockholm -a fast-growing architectural firm with commercialcustomers in the premium segment within hospitality, retail and office property. 70 employees and sales ~SEK 85 million

• Eitech automation business – with a wide range of services within industrial digitalisation, automation and robotics for industrial clients throughout Sweden. 42 employees and sales ~SEK 90 million

• New control system in production process at Stora Enso

• Comprehensive project renewing BoråsHospital

• Project management of the Police National Emergency Unit in Norway

• Technical installations in the construction of Denmark's highest residential building

• Owner’s Engineering for new hydropower plant in Egypt.

• Owner’s Engineering for new nuclear plant in Turkey

Market development

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Market for industrial investments is strong in Sweden

Automotive, pharma, pulp & paper and other manufacturing industries are growing

Mining & steel shows signs of increasing demand, however from low levels

Digitalisation entails overall increasing demand for embedded systems and IT

Continued high rate of investments in the infrastructure market

Energy market in Europe still weak while demand continues to grow in Southeast Asia

and Africa

Continued growth

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Net sales SEK M

Net Sales 3 231 SEK M (2 942) +10 %

Apr - Jun, 2017

• Net sales 3 231 SEK M (2 942)• Total growth 9.8 %• Organic growth 2.1%*• Continued growth in key

segments and markets

Jan - Jun, 2017

• Net sales 6 496 SEK M (5 585) • Total growth 16.3 % whereof

2.8 %* organic growth

*adjusted for calendar and currency effects

Improved profitability

EBITA* 302 SEK M (292)

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Apr - Jun, 2017

• EBITA* increased to 302 SEK M (292)

• EBITA margins above 9 % in 3 out of 4 divisions

• Improved margin in International division

• Restructuring costs 20 SEK M

Jan - Jun, 2017

• EBITA* increased to 589 SEK M

(520)

EBITA SEK M*excl items affecting comparability

Strong Cash Flow and Balance SheetCash Flow from operations generated SEK M 368 (386) Jan-Jun

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SEK M Comments

Net Debt as of Dec 31, 2016 2 298

Cash flow from operating activities - 368

Capex 51

Acquisitions and Earn Outs 285 8 acquisitions

Dividend 350

Buyback of shares -

Other 22

Net Debt as of Jun 30, 2017 2 639

Net Debt / EBITDA 2.3 Target 1.5 - 2.0

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• Overall strong industrial investments

• Increasing demand for industrial digitalisation and automation solutions

• Increasing demand for turnkey projects from manufacturing, food&pharma and automotive

• Mining & steel shows signs of increasing demand, however from low levels

Decreased EBITA • EBITA 118 SEK M -3%• EBITA margin 9.4%• New assignments from LKAB and Stora

Enso

Market & highlights

Industry Division

Continued growth

• Net sales 1 256 SEK M +6%

• Organic growth 4.2%*• Acquisition of Eitech automation

business in July

Apr-Jun2017

Apr-Jun2016

Jan-Jun2017

Jan-Jun2016

Full year

2016

Net sales, SEK million

1 256 1 187 2 516 2 256 4 437

EBITA, SEK million 118 122 227 207 403

EBITA margin, % 9.4 10.3 9.0 9.2 9.1

Average number FTEs

3 361 3 144 3 355 3 172 3 177

*adjusted for calendar effects

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• Still strong demand in the infrastructure market

• Investments in sustainable buildings increasing the demand for project management and architecture

• The ability to drive both a larger number of minor assignments as well as major and more complex assignments is a success factor

Stable EBITA • EBITA 125 SEK M +0%• EBITA margin 10.9%• New assignments from Borås Hospital and

Norwegian Ministry of Justice and Public Security

Market & highlights

Infrastructure Division

Continued growth

• Net sales 1 155 SEK M +6%

• Organic growth -0.5%*• The division was strengthened by the acquisition of

Koncept Stockholm

Apr-Jun2017

Apr-Jun2016

Jan-Jun2017

Jan-Jun2016

Full year

2016

Net sales, SEK million

1 155 1 087 2 345 2 009 4 037

EBITA, SEK million 125 125 252 224 421

EBITA margin, % 10.9 11.5 10.8 11.1 10.4

Average number FTEs

3 467 2 977 3 412 2 851 2 966

*adjusted for calendar effects

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• Energy market in Europe still weak while demand continue to grow in Southeast Asia and Africa

• New Owner’s Engineering assignments for hydro power plant in Egypt and nuclear plant in Turkey

• Also new assignments within transmission and distribution

Increased EBITA • EBITA 30 SEK M +76%• EBITA margin 7.3%• Acquisitions, new assignments and increased

utilisation rate improve EBITA

Market & highlights

International Division

Increased growth

• Net sales 409 SEK M +56%

• Organic growth 7.9%• Following the acquisition of AF Toscano,

infrastructure operations represent approx 30%

Apr-Jun2017

Apr-Jun2016

Jan-Jun2017

Jan-Jun2016

Full year

2016

Net sales, SEK million

409 263 784 541 1 098

EBITA, SEK million 30 17 45 30 58

EBITA margin, % 7.3 6.3 5.7 5.6 5.3

Average number FTEs

1 171 842 1 185 850 844

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• Overall increasing demand for embedded systems and digital solutions

• Increased demand for product development assignments

• Strong demand from automotive and ÅF is established as the leading development partner in Sweden in this segment

• Also public IT and the defense industry shows positive signs

Stable EBITA • EBITA 48 SEK M +0%• EBITA margin 9.7%• New assignment from BAE systems,

Scania, SAAB, CEVT and Verisure• Framework agreement with Zenuity

Market & highlights

Technology Division

Continued growth

• Net sales 490 SEK M +3%

• Organic growth 4.6%*

Apr-Jun2017

Apr-Jun2016

Jan-Jun2017

Jan-Jun2016

Full year

2016

Net sales, SEK million

490 476 1 005 914 1 793

EBITA, SEK million 48 48 95 91 167

EBITA margin, % 9.7 10.1 9.4 9.9 9.3

Average number FTEs

1 078 979 1 081 984 1 006

*adjusted for calendar effects

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Division Industry Infrastructure International Technology

Share of net sales

38% 34% 13% 15%

Growth 5.8% 6.2% 55.7% 3.0%

Whereof organicgrowth*

4.2% -0,5% 7.9% 4.6%

EBITA margin 9.4% 10.9% 7.3% 9.7%

Divisions development Q2

*adjusted for calendar effects

Strong result and continued good growth

Q2 Summary

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EBITA* 302 SEK M (292) +3%

NET SALES 3 231 SEK M (2 942) +10%

• Improved earnings and continued good growth

• The markets for industrial and infrastructure

investments are strong

• Energy market remains weak in Europe

• Several key assignments within all divisions

• Acquisition of Koncept Stockholm and Eitech

automation business

• Good progress in ongoing strategy review

*excl items affecting comparability

Sales

Sales Euro 2 billion

EBIT Best in class

Best in class > 10 % over a business cycle

Net debt

Net debt/EBITDA 1.5-2.0 over a business cycle

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SalesSales Euro 2 billion

EBIT Best in classBest in class > 10 % over a

business cycle

Net debtNet debt/EBITDA 1.5-2.0

over a business cycle

Goals 2020

Strategy process update

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Good progress in current strategy review

ÅF has a unique breadth of capabilities to meet the

ongoing trends such as digitalisation, automation and

smart cities.

New strategy will include growth initiatives as well as

improved operational performance/cost reductions

Further restructuring costs in Q3

Capital Markets Day Nov 8

Welcome to Capital Markets DayNovember 8 ÅF Headquarters

in Solna, Sweden

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