Ratos establishes new financial targets related to its strategy to develop a long-term business group

Regulatory Information 2021-02-08

• EBITA is to amount to at least SEK 3 billion by 2025.
• Net debt in relation to EBITDA should normally range from 1.5 to 2.5x.
• The dividend payout ratio should amount to 30–50% of profit after tax attributable to owners of the parent, excluding capital gains and losses.

The Board of Ratos AB (“Ratos”) decided on these new financial targets based on the previously announced decision to steer the direction of operations towards becoming a business group with a long-term perspective. Ratos currently has an “eternal” ownership horizon and invests to build value over the long term.

“After reviewing the investment strategy implemented by Ratos’s management and Board in 2018, our focus was initially on increasing stability and profitability in the companies owned. This work resulted in EBITA in 2020 more than doubling compared with 2018. This means that Ratos and its companies are ready to take the next step, with a focus on profitable growth, both organically and through acquisitions,” says Per-Olof Söderberg, Chairman of Ratos.

“We are well positioned to accelerate the pace of execution of our business plan, with the aim of investing in organic growth and margin growth in the existing business group as well as add-on acquisitions and potential new acquisitions. We have taken several steps in the transformation of Ratos and are now a business group focused on profitable growth. At the same time, a great deal of work remains to reach our targets,” says Jonas Wiström, President and CEO of Ratos.

FINANCIAL TARGETS

Ratos decided on the following financial targets:

EBITA growth
Target: EBITA is to amount to at least SEK 3 billion by 2025.

Net leverage
Target: Net debt in relation to EBITDA should normally range from 1.5 to 2.5x, excluding financial leasing liability. The target includes the cash balances of Ratos’s parent company.

Dividend payout ratio
Target: The dividend payout ratio should amount to 30–50% of profit after tax attributable to owners of the parent, excluding capital gains and losses.

The new financial targets replace the previous targets, which were: 1. the earnings of the company portfolio should increase each year; 2. the total return on Ratos shares should, over time, outperform the average on Nasdaq Stockholm; and 3. that the dividend payout ratio should be 30–50% of profit after tax attributable to owners of the parent.

Telephone conference
Jonas Wiström, President and CEO of Ratos, and Jonas Ågrup, CFO, will hold a telephone conference at 9:00 a.m. CET on 8 February to discuss the publication of Ratos’s year-end report and to present the financial targets. 

To participate in the teleconference, call UK: +44 333 300 9031, SE: +46 8 505 583 50, US: +1 833 526 83 47 or follow this link https://financialhearings.com/event/13548. The presentation material is also available on Ratos’s website: www.ratos.com.

This is information that Ratos AB is required 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 below, on 8 February 2021 at 7:00 a.m. CET.

For further information, please contact:
Jonas Wiström, President & CEO
+46 8 700 17 00

Helene Gustafsson, Head of IR and Press
+46 8 700 17 98
helene.gustafsson@ratos.com

About Ratos:
Ratos is a business group consisting of 11 companies divided into three business areas: Construction & Services, Consumer & Technology and Industry. In total, the companies have SEK 33 billion in sales and EBITA of SEK 2 billion. Our business concept is to develop mid-sized companies headquartered in the Nordics that are or can become market leaders. We enable independent mid-sized companies to excel by being part of something larger. A focus on people, leadership, culture and values is a key component of Ratos. Everything we do is based on Ratos’s core values: Simplicity, Speed in Execution and It’s All About People.