Year-end 2014 Presentation

Värnamo, February 20, 2015

2

Bufab Group

Fourth quarter

Established

in 1977

Around 800

employees

30 wholly owned

subsidiaries in23 countries

Approx 2 200 MSEK in turnover

Headquarters in

Värnamo, Sweden

120 000

articles

Listed on the stock exchange

12 000customers

In-house

production

3

Volume vs. value

Fourth quarter

4

Fourth quarter

Bufab´s Strategy

2

Quality and Customer First!

Accelerated organic

GrowthImproved cost/capital

EfficiencyValue-adding

Acquisitions

• New Business Growth -Customer Value Creation

• All of Bufab, All the Time

• Global Parts Productivity ™

• Consolidate Sourcing

• Logistics Productivity

• Common Tools and Processes

• Good Base Performance • Growth Synergies

• Products

• Geography• Customer

• Shared Value Creation

6

Financial targets

Fourth quarter

Sales growth

Bufab’s goal is to achieve average annual organic growth over a

business cycle exceeding the growth of the manufacturing industry in countries where Bufab is active by three percentage

points. In addition, Bufab intends to grow through acquisitions.

+3 ppt

Profitability

Bufab targets an average operating margin of 12 percent over a

business cycle. 12 %

Capital structure

Bufab’s capital structure shall provide a high degree of financial

flexibility and make acquisitions possible. The net debt/equity ratio should not exceed 80%.

<80%

Net working capital

Bufab’s long-term goal is to achieve a net working capital/net

sales ratio of 30 percent. 30%

Dividend policy

Bufab’s target is to pay 50 percent of its net profit in dividends.

However, the company’s financial condition, cash flow, acquisition opportunities and future prospects will be taken into

account in any dividend decision.

50%

ACCELERATED ORGANIC GROWTH

IMPROVED EFFICIENCY

VALUE-ADDING ACQUISITIONS

6

Fourth quarter

� Growth strategy proven, but need better leverage

– Second highest sales ever…

– ..despite weak underlying demand, especially in second half and in Sweden

– Excellent market shares gain in International - now 57% of sales

– However, investments in sales organization puts pressure on margins. Starting 3Q 2014, opex increase has leveled out.

� Efficiency - satisfying results so far but need for intensified focus

– Continued purchasing savings

– Headwind toward end of year in mix, currency combined with weak

demand in Sweden� Focus area for 2015 - direct and indirect cost + price

� Acquisitions – pipeline established

� IPO

Summary 2014

7

Financial highlights, Group

Fourth quarter

Fourth quarter

Net sales - weak ending 2014

�Order intake in line with net sales

�Weaker net sales growth compared to earlier

quarters - adjusted for currency translation 1.6 %

�Continuing growth in International with

increased market shares

�Lower underlying demand, especially in Sweden

*Excluding IPO costs of 18 MSEK in Q1, 2014

Operating margin

�Negatively affected by higher costs for sales

organization – levelling out

�Negative impact from currencies– 6 MSEK in Q4

�Strong comparable Q4 2013

Quarter 4 Δ Jan-Dec Δ

SEK millions 2014 2013 % 2014 2013 %

Order intake 533 519 2.7 2,195 2,072 5.9

Net sales 532 512 4.0 2,198 2,031 8.3

Gross margin, % 28.1 30.3 29.2 29.3

Adjusted operating profit* 33 55 -40.2 192 203 -5.3

Adjusted operating margin, % 6.2 10.8 8.7 10.0

0

50

100

150

200

250

0

500

1000

1500

2000

2500

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

MS

EK

LT

M N

et sale

s, S

EK

mill

ions

LTM Net sales 12 M, MSEK LTM Adj Op Res, MSEK

-6

-8

-1

6

4

10

8

6

2

-10

-5

0

5

10

15

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

Quarterly year-on-year net sales growth, %*

8

Financial development, Group

Fourth quarter

*Adjusted for currency translation effects

9

Segment Sweden

Fourth quarter

Fourth quarter

Order intake in line with net sales

Net sales decreased

• Weak underlying demand, likely worsened by

“long Christmas”, inventory adjustments

• Unchanged market shares, except one customer

to manufacturing subsidiary

Weaker operating margin

• Lower volumes

• Adverse exchange rates

• Higher operating costs

*Pertains to net sales and order intake from external customers

Quarter 4 Δ Jan-Dec Δ

SEK millions 2014 2013 % 2014 2013 %

Order intake* 232 241 -3.7 968 998 -3.0

Net sales* 229 243 -5.6 982 970 1.2

Adjusted operating profit 27 40 -33.9 144 143 0.2

Adjusted operating margin, % 11.7 16.7 14.6 14.8

0

50

100

150

200

0

500

1000

1500

2000

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

MS

EK

LT

M N

et sale

s, S

EK

mill

ions

Net sales LTM, MSEK LTM Adj Op Res, MSEK

-7-9

-6

-2

3

6

21

-6

-10

-5

0

5

10

15

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

Quarterly year-on-year net sales growth, %

10

Financial development, segment Sweden

Fourth quarter

11

Segment International

Fourth quarter

Fourth quarter

Order intake in line with net sales

Strong sales growth

�Adjusted for currency effects 7.9 %

�Strategic initiatives showing results

�Higher market shares –

underlying demand somewhat weaker than in 1H

Operating margin

�Negatively by higher cost for stronger sales organization

�Q4 2013 strong comparable

*Pertains to net sales and order intake from external customers

Quarter 4 Δ Jan-Dec Δ

SEK millions 2014 2013 % 2014 2013 %

Order intake* 301 277 8.6 1,227 1,074 14.3

Net sales* 303 269 12.7 1,217 1,061 14.7

Adjusted operating profit 12 19 -36.0 75 83 -10.0

Adjusted operating margin, % 4.0 7.0 6.2 7.8

0,0

50,0

100,0

150,0

200,0

0

500

1000

1500

2000

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

MS

EK

LT

M N

et sale

s, S

EK

mill

ions

Net sales LTM, MSEK LTM Adj Op Res, MSEK

-5

-7

5

13

6

14 14

10

8

-10

-5

0

5

10

15

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

Quarterly year-on-year net sales growth, %*

12

Financial development, segment International

Fourth quarter

*Adjusted for currency translation effects

13

Fourth quarter

25,0%

30,0%

35,0%

40,0%

45,0%

50,0%

0

200

400

600

800

1000

Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014

As o

f%

ofnetsale

sS

EK

mill

ions

Net Working Capital As of % of net sales

Net working capital

14

Challenges faced toward end 2014 -and focus areas for 2015

Fourth quarter

Focus areas

Weak demand, especially Sweden

• Implementing new cost savings package of 15 MSEK yearly, full

effect from Q3:Merger two subsidiaries, streamlining backoffice, staff reduction

one manufacturing subsidiary• Continued investments and efforts in sales - some promising signs

Challenges

Adverse currencies: weak SEK, strong USD

• Weak SEK: Price increases being implemented since mid-Q4

Strong USD: Increased efforts in purchasing – organization strengthened and tools improved – helped by good outlook for raw

material prices

Insufficient leverage on growthin International

• Investments made 2014 are “good cost”, …

• …but we are holding back increases from level of Q3, 2014 untilwe see positive margin effects from growth

• Strong focus on landing and ramping up business already awarded