AarhusKarlshamn AB Q3 ENG 2011

8/3/2019 AarhusKarlshamn AB Q3 ENG 2011

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AAK Interim Report Quarter 3, 2011

Third quarter 2011 Operating profit AAK Groupand Business Areas, Q3 2011

Net sales in the third quarter increased to SEK4,462 million (3,774), mainly due to increasedraw material prices and a better product mix,partly offset by a negative currency translationimpact of SEK 246million. Volume increasedby 5 percent due to increases in specialityvolumes, including the impact of the GoldenFoods/Golden Brands acquisition (SEK 225million in net sales); commodity volumes weredown, mainly as earlier predicted in the UK.

Operating profit amounted to SEK 246million(231), an improvement of 6 percent. At fixedexchange rates operating profit improved by

13 percent. Before acquisition related costs ofSEK 7 million, operating profit amounted toSEK 253 million, an improvement of 10percent.

Earnings per share amounted to SEK 3.48(3.73), a decrease of 7 percent, duesubstantially to the impact of revaluing interestrate swap contracts arranged to fix forwardinterest rates.

First nine months 2011 Third quarter 2011

Net sales in the first nine months increased toSEK 12,212 million (10,878) mainly, due toincreased raw material prices and a betterproduct mix; offset by a negative currencytranslation impact of SEK 845 million. Volumeoverall decreased by 2 percent due to lowercommodity volumes, mainly in the UK.Speciality volumes continued to increase.

Operating profit, excluding non-recurring itemsof SEK 3 million, amounted to SEK 646 million(573), an improvement of 13 percent. At fixedexchange rates operating profit improved by21percent. Before acquisition related costs of

SEK 7 million, operating profit amounted toSEK 653 million, an improvement of 14percent.

Earnings per share amounted to SEK 9.90(9.17), an improvement of 8 percent.

Financial summary (excluding non-recurring costs)

SEK Million Q32011

Q32010 %

Q1-32011

Q1-32010 %

Net Sales 4,462 3,774 +18 12,212 10,878 +12Gross Contribution 915 927 -1 2,577 2,619 -2Operating profit 246 231 +6 646 573 +13Operating profit per kilo 0.67 0.66 +2 0.62 0.54 +15

Financial net -52 -10 -420 -97 -40 -142Net result 142 121 +17 407 309 +32Earnings per share 3.48 3.73 -7 9.90 9.17 +8

0

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Group FI CCF TPF

SEKmillion

2010

2011

+6 %

+15%

+10%

ne


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Chief Executives Report - Continued strong

improvements and AAK Acceleration on track

Third quarter 2011Operating profit for the thirdquarter 2011 reached SEK 246million (231), an improvement of6 percent. At fixed exchangerates, operating profit improvedby 13 percent. Beforeacquisition related costs of SEK7 million, operating profitamounted to SEK 253 million,an improvement of 10 percent.

Earnings per share decreasedby 7 percent, from SEK 3.73 toSEK 3.48 substantially due tothe impact of revaluing interestrate swap contracts arranged tofix forward interest rates.

During the third quarter of 2011volumes increased by 5 percentdue to increased specialityvolume, including the impact ofthe Golden Foods/GoldenBrands acquisition. Commodity

volumes continuedto decline, consistent withprevious quarters. The largestcommodity volume reductionwas in the UK, which as earlierannounced, is beingrestructured for improved focuson speciality products.

Volumes of speciality productsin Food Ingredients andChocolate & Confectionery Fatscontinued to increase in line

with the strategy and the action

plans defined in AAKAcceleration.

Food Ingredients Againstrongly improved profitsand continued increase ofvalue added productsIn the largest business area,Food Ingredients, operatingprofit reached SEK 143 million(124*), an improvement of 15percent. Continued increasedportion of high-value productswith a more profitable productmix affected the third quarter of2011 positively. Further more,the business area had afavourable product mix andgenerally also very high yields inthe plants. Operating profit atfixed exchange rates amountedto SEK 151 million (124*), animprovement of22 percent.

The development continued inmany speciality product areas,in particular for Infant Nutrition(Baby Food), Dairy Industry andBakery.

In the third quarter of 2011 totalvolumes increased by 3 percentcompared to the correspondingquarter in 2010. The volumegrowth comprised increasedspeciality volume, including thecontribution from the GoldenFoods/Golden Brandsacquisition and partly offset bylower commodity volumes

following the refocusing in theUK market on specialityproducts. Accordingly, operatingprofit per kg in this businessarea continued to improved.

Chocolate & ConfectioneryFats Strong volumegrowth and stable marginsOperating profit amounted toSEK 112 million (102), animprovement of 10 percent.

Volumes increased by 13percent compared to last year.Operating profit at fixedexchange rates amounted toSEK 120 million (102), animprovement of 18 percent.The general market conditionsremained stable. Underlyingoperating profit per kilo inChocolate & Confectionery Fatscontinued to be stable but with aslightly unfavourable productand customer mix in the thirdquarter of 2011.

Technical Products & Feed Challenging marketconditions and high rawmaterial pricesOperating profit was at SEK 15million (29*) in the third quarter.Volume increased by 1 percentcompared to the correspondingquarter last year.

The reduced profitability in thebusiness area during the thirdquarter was due to increased


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raw material costs for fattyacids, crushing margins underpressure and the planned butlonger than normal maintenancestop in Karlshamn.

AAK strengthened its

positions in North Americaby the acquisition of theBakery specialist, GoldenFoods/Golden BrandsAs announced on July 1, 2011AAK has acquired the GoldenFoods/Golden Brands businessof Louisville, Kentucky, aleading North Americanprocessor of speciality fats andoils for Bakery. GoldenFoods/Golden Brands is theleading manufacturer of flaked

shortenings for the bakery andfood service industries in NorthAmerica.

Founded in 1982 and located inLouisville, Kentucky, GoldenFoods/Golden Brands employsapproximately 160 people andhad revenues of approximatelyUSD 120 million in 2010.

The acquisition is an integralpart of the AAK Accelerationprogram, which as well asorganic growth, calls forselective, synergisticacquisitions. This acquisitionsignificantly strengthens AAKsability to supply existing andnew customers with a broaderportfolio of speciality oils andfats solutions. As one of thelargest speciality oil markets inthe world, expansion in the USis also particularly exciting.

The product lines that AAK hasacquired expand andcomplement our existingproduct portfolio and speciality

strategy. The GoldenFoods/Golden Brandsacquisition has created goodopportunities for mutual crossselling to the combinedcustomer base. Further, theLouisville, Kentucky locationalso adds a new, important,geographical dimension to ourexisting site in Port Newark,New Jersey, with significantadvantages for all customersbut particularly those located inthe Midwest. As a consequenceof this acquisition AAKs NorthAmerican customers will enjoyservice from two productionsites in the US.

The acquisition is expected to

have limited impact on the 2011Group operating profit, withbenefits beginning from the firstquarter of 2012.

During the third quarter earlyphases of the integration hasbeen according to plan and theintegration of GoldenFoods/Golden Brands, nowrenamed to AAK Louisville, hasbeen very well received by bothcustomers and employees.

AAK Ongoingrationalization programsThe ongoing productivityimprovements in theScandinavian and UK unitscontinue in line with plans.

Cash flowCash flow from operatingactivities was positive SEK 189million (negative 210) during thethird quarter. We have nowlargely reversed negative cashflow impact of the dramatic rawmaterial price increases during

the last six months 2010.

Concluding remarksWe continue to see very positiveeffects of the AAK Accelerationprogram, in terms of organicgrowth in speciality products,

acquisitive growth and inproductivity.

Speciality volumes increasedparticularly well in InfantNutrition, Dairy Industry, Bakeryand Chocolate & ConfectioneryFats.

The acquisition of GoldenFoods/Golden Brandssignificantly strengthens ourability to supply both existing

and new customers with abroader portfolio of specialityoils and fats solutions in the US.

The effects on our industry fromthe more difficult generaleconomy in Europe are difficultto predict. However, with thedramatic food price inflation in2010, at least for now, behindus, AAKs customer valuepropositions for health andreduced costs and the AAK

Acceleration program, weremain prudently optimistic forthe future.

Arne FrankCEO and President

* Starting with the first quarter of 2011 the Groupsoperations in crushing will be reported as part of

business area Technical Products & Feed. Thecrushing operation has previously been reportedwithin the business area Food Ingredients. For furtherinformation, see page 18.


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The AAK Group, third quarter 2011

Net salesNet sales increased by SEK688 million mainly due to

increased raw material pricesand a better product mix, partlyoffset by a negative currencytranslation impact of SEK 246million.

Volumes increased by 5percent due to increasedspeciality volumes, includingthe acquisition of GoldenFoods/Golden Brands (SEK225 million in net sales);commodity volumes were

lower, particulary in the UK.

Gross contributionExcluding translation effects,gross contribution improved bySEK 36 million, before anegative translation impactSEK 48 million.

After including translationeffects, gross contributiondecreased by SEK 12 million.

Operating resultOperating profit for the thirdquarter of 2011 reached SEK246 million (231), animprovement of 6 percent. Atfixed exchange rates, operatingprofit improved by 13 percent.Before acquisition related costsof SEK 7 million, operatingprofit amounted to SEK 253million, an improvement of 10percent. As previously

communicated the acquisitionof Golden Foods/GoldenBrands will not have anysignificant operating resultimpact during 2011.

Operating profit per kiloincreased from SEK 0.66 toSEK 0.67 or by 2 percent dueto a higher portion of valueadded products. Speciality

volumesincreased whilst lowmargin commodity volumesdecreased.

Financial netDuring the third quarter 2011we saw a negative impact fromthe market valuation of interestswaps amounting to SEK 22million.

At the end of the third quarter20 percent of net interest-bearing debt has beenswapped from free floating tofixed interest rates.

InvestmentsGroup investments amountedto SEK 410 million (66), mainlycomprising the acquisition ofGolden Foods/Golden Brandsand normal maintenanceinvestments.

Cash flowCash flow from operatingactivities was SEK 189 million(negative 85). We have nowlargely reversed negative cashflow impact of the significantraw material price increasesduring the last six months of2010.

Raw material prices havesubsequently decreased,which will positively effect cashflow the first half of 2012 andcould potentially have a positiveimpact in the fourth quarter of

2011.Cash flow, after netinvestments of SEK 410 million(65), was negative SEK 221million (negative 150).

Financial positionThe equity/assets ratioamounted to 34 percent (34

percent at 31 December 2010).Net debt at 30 September 2011amounted to SEK 3,637 million(SEK 2,634 million on 31December 2010). At 30September, the Group had totalcredit facilities of SEK 6,000million.

EmployeesThe average number ofemployees at 30 September2011 was 2,096 (2,101 on 31

December 2010).The net change consists ofa reduction in Scandinavia inline with our restructuringprograms, offset by increasesin focused growth markets andan increase of 142 employeesrelated to the acquisition ofGolden Foods/Golden Brands.

The Parent Companyand Group Functions

The Parent Company is aholding company for the AAKGroup. Its functions areprimarily joint activities relatedto the development andadministration of the Group.

During the third quarter wehave recorded SEK 7 million inacquisitions costs related toGolden Foods/Golden Brandsin Group Functions.


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Group Q3 2011

Volume and operating profit per kilo

Volume Q3 2011

AAK Group Food Ingredients Chocolate andConfectionery Fats

Technical Products &Feed

+5 percent +3 percent +13 percent +1 percent

351,000 MTto 368,000 MT 208,000 MTto 214,000 MT 75,000 MTto 85,000 MT 68,000 MT to 69,000 MT

Operating profit per kilo

AAK Group Food Ingredients Chocolate andConfectionery Fats

Technical Products &Feed

+2 percent +12 percent -3 percent -50 percent0,66 SEK to 0,67 SEK 0.60 SEK to 0.67 SEK 1.36 SEK to 1.32 SEK 0.43 SEK to 0.22 SEK

0

200

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800

1 000

1 200

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1 800

0

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300

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Q107

Q207

Q307

Q407

Q108

Q208

Q308

Q408

Q109

Q209

Q309

Q409

Q110

Q210

Q310

Q410

Q111

Q211

Q311

Rolling12months,'000MT

Quarter,'000MT

AAK Group - Volume

Quarter Rolling 12 months

0

100

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400

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600700

800

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1000

0

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350

Q107

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Q409

Q110

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Q310

Q410

Q111

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Q311

Rollin

g12months,SEK

million

Quarter,SEKmillion

AAK Group - Operating profit


0,00

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0,90

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Q107

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Q408

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Q309

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Q110

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Q310

Q410

Q111

Q211

Q311

Rolling12m

onths,SEK/Kg

Quarter,S

EK/Kg

AAK Group - Operating profit per kilo


6,0%

7,0%

8,0%

9,0%

10,0%

11,0%

12,0%

13,0%

14,0%

15,0%

Q107

Q207

Q307

Q407

Q108

Q208

Q308

Q408

Q109

Q209

Q309

Q409

Q110

Q210

Q310

Q410

Q111

Q211

Q311

Return on Net Operating Assets -Rolling 12 months

0,00

0,50

1,00

1,50

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2,50

3,00

3,50

4,00

4,50

5,00

Q1 07Q2 07Q3 07Q4 07Q1 08Q2 08Q3 08 Q4 08Q1 09Q2 09Q3 09Q4 09Q1 10Q2 10Q3 10 Q4 10Q1 11Q2 11Q3 11

NET DEBT/EBITDA


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Business Area Food Ingredients, Q3 2011

Net salesNet sales for the business areaincreased by SEK 540 milliondue to increased raw materialprices and a better product mix

and the acquisition of GoldenFoods/Golden Brands, partlyoffset by negative currencytranslation impact of SEK 161million.

In the third quarter of 2011 totalvolumes increased by 3 percentcompared to the correspondingquarter in 2010. The volumegrowth comprised increasedspeciality volumes and newvolumes from the acquisition of

Golden Foods/Golden Brands(SEK 225 million in net sales)which was partly offset byrefocusing in the UK market onspeciality products andconsequently reducedcommodity volumes.

Gross contributionGross contribution increased to477 SEK million (448*),including negative translationeffects of SEK 30 million.

Operating resultOperating profit amounted toSEK 143million (124*), anincrease of 15 percent. Theresult includes negative

translation effects of SEK 8million. At fixed exchange rates,operating profit was up 22percent compared to last year.

Continued increased portion ofhigh-value products with amore profitable product mixaffected the third quarter of2011. Further, several thingswent our way during the quarteri.e. we had a favourableproduct mix and generally high

yields in the plants.The acquisition of GoldenFoods/Golden Brands will onlyhave limited impact on the 2011operating profit, but it will bringmaterial benefits beginningfrom the first quarter 2012.

Acquisition of GoldenFoods/Golden BrandsAs announced on July 1, 2011AAK has acquired the GoldenFoods/Golden Brands business

of Louisville, Kentucky,whichwill be an integral part of theFood Ingredients business.

During the third quarterintegration has continuedaccording to plan.

Raw material prices forpalm and rapeseed oil,SEK/tonne

* Starting with the first quarter of 20 11 the Groupsoperations in crushing will be reported as part ofbusiness area Technical Products & Feed. Thecrushing operation has previously been reportedwithin the business area Food Ingredients. Forfurther information, see page 18.

** All figures are excluding non recurring items.

Financial summary**

0

2000

4000

6000

8000

10000

12000

SEK/ton

Raw material prices - Rapeseed and Palm

Rapeseed Palm

SEK MillionNet SalesGross ContributionOperating profitOperating profit per kiloVolumes (000 tonnes)

Q32011

Q32010 %

Q1-32011

Q1-32010* %

Full Year2010*

Rolling12months*

2,694 2,154 +25 7,290 6,378 +14 8,667 9,579477 448 +6 1,280 1,304 -2 1,826 1,802143 124 +15 367 322 +14 454 4990.67 0.60 +12 0.61 0.50 +22 0.53 0.61214 208 +3 597 639 -7 861 819


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Business Area Chocolate & Confectionery Fats,

Q3 2011

Net salesNet sales for the business area

improved by SEK 150 million,or by 12 percent, due to volumegrowth and raw material priceincreases, partly offset bynegative translation effects ofSEK 85 million.

Gross contributionExcluding translation effectsgross contribution decreasedby SEK 7 million.

During the third quarter the

business area recognisednegative translation effects ofSEK 18 million. After includingthese effects, gross contributiondecreased by SEK 25 million.

Operating resultThe operating result reachedSEK 112 million (102), an

increase of 10 percent. Thisresult included a negativetranslation impact of SEK 8million. At fixed exchange rates,operating profit was up 18percent compared to last year.

Compared to last year, volumeincreased by 13 percent andoperating profit per kgdecreased from SEK 1.36 toSEK 1.32. Margins continued tobe stable but with a somehowunfavourable product andcustomer mix in the thirdquarter of 2011.

The general market conditionswere stable.

External factors/activitiesThe third quarter resultconfirmed seasonalimprovements compared to thetraditionally weakest second

quarter for the Chocolate &Confectionery Fats businessarea.

We saw continued strongdemand in the Americas (North,Central and South) andmoderate demand in Europe.

Cocoa butter, SEK/tonneFor information regardingcocoa and cocoa butter pleaserefer to information atwww.icco.org.

* All figures are excluding non-recurring items

Financial summary*

0

10000

20000

30000

40000

50000

60000

SEK/ton

Cocoa Butter price development)

SEK MillionNet SalesGross ContributionOperating profitOperating profit per kiloVolumes (000 tonnes)

Q32011

Q32010 %

Q1-32011

Q1-32010* %

Full Year2010*

Rolling12months*

1,354 1,204 +12 3,657 3,328 +10 4,474 4,803354 379 -7 1,000 1,023 -2 1,394 1,372112 102 +10 263 235 +12 341 3691.32 1.36 -3 1.11 1.07 +4 1.14 1.17

85 75 +13 237 219 +8 298 316


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Business Area Technical Products & Feed,Q3 2011

Net sales

Net sales for the business areadecreased by SEK 2 million.

Volumes in the third quarter2011 increased by 1 percentcompared to the correspondingquarter last year.

Gross contributionGross contribution hasdecreased by SEK 16 million.compared to the third quarter2010

Operating result

Operating profit of SEK 15million (29*) decreased 48percent compared to thecorresponding quarter last year.

The reduced profitability in thebusiness area during the thirdquarter was due to increasedraw material costs for fattyacids, crushing margin beingunder pressure and a plannedbut longer than normalmaintenance stop inKarlshamn.

External factors/activities

The biolubricant businesscontinued to enjoy signs ofmarket recovery. However, rawmaterial market prices for fattyacids continue to be at highlevels and the crushing marginis still under pressure.

* Starting with the first quarter of 2011 the Groupsoperations in crushing will be reported as part ofbusiness area Technical Products & Feed. Thecrushing operation has previously been reportedwithin the business area Food Ingredients. Forfurther information, see page 18.

Financial summary

SEK MillionQ3

2011Q3

2010* %Q1-32011

Q1-32010* %

Full year2010*

Rolling 12months*

Net Sales 414 416 -0 1,265 1,172 +8 1,667 1,760Gross contribution 84 100 -16 297 293 +1 405 409Operating profit 15 29 -48 82 82 +0 118 118Operating profit per kilo 0.22 0.43 -49 0.40 0.40 +0 0.42 0.42Volumes (000tonnes)

69 68 +1 207 207 +0 282 282


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The AAK Group, first nine months 2011

Net salesNet sales increased by SEK1,334 million mainly due to

increased raw material pricesand a better product mix andthe acquisition of GoldenFoods/Golden Brands, partlyoffset by a negative currencytranslation impact of SEK 845million.

In the third quarter specialityvolume increased in FoodIngredients and Chocolate &Confectionery Fats whilecommodity volumes for Food

Ingredients, mainly in the UK,continued to decline.

There are no major changes inthe general market conditionsfor speciality productscompared to last year.

Gross contributionExcluding translation effects,gross contribution improved bySEK 128 million, before anegative translation impact was

SEK 170 million. After includingtranslation effects, grosscontribution decreased by SEK42 million.

Operating resultOperating profit, excluding non-recurring items of SEK 3

million, reached SEK 646million (573), an improvementof 13 percent. At fixedexchange rates, operating profitamounted to SEK 694 million(573), an improvement of 13percent.

Before acquisition related costsof SEK 7 million, operatingprofit amounted to SEK 653million, an improvement of 14percent.

Operating profit per kiloincreased from SEK 0.54 toSEK 0.62 or by 15 percent dueto a higher share of valueadded products.

InvestmentsGroup investments amountedto SEK 573 million (244),mainly comprising theacquisition of GoldenFoods/Golden Brands andregular maintenanceinvestments.

Cash flowAs anticipated, cash flow fromoperating activities wasnegative SEK 210 million(positive 225), as a result of the

significant raw material priceincreases during the last sixmonths of 2010.

Cash flow, after netinvestments of SEK 573 million(244), was negative SEK 783million (negative 19).

Long term refinancingLong term refinancing of SEK4,200 million was finalized inJanuary 2011 and comprisespart of the total committedfacilities of SEK 6,000 millionfor five years or more.

AAK - Additionalrationalization program,UKDuring the first quarter 2011 thecompany announced anadditional rationalizationprogram for the UK operationsin order to fully focus on ourspeciality strategy.

The rationalization implies

a further move away from largervolume low margin commodityproducts to more complex,lower volume specialityproducts at higher margins.


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General information

Related partiesNo significant changes havetaken place in relations or

transactions with related partiessince 2010.

Insurance compensationDuring the second quarter thecompany finalized theinsurance case related tobusiness interruption in 2008and 2009.

The net impact of thissettlement was basically offsetby the UK restructuring costsduring the second quarter of2011.

Risk and uncertaintyfactorsAll business operations involverisk a controlled approach torisk taking is a prerequisite inmaintaining good profitability.Risk may be dependent uponevents in the outside world andmay affect a specific sector,

market or country, and the riskmay also be purely company-specific.

At AAK, effective riskmanagement is a continuingprocess carried out within theframework of operationalmanagement and forms anatural part of the day-to-daymonitoring of operations.

External risks

The AAK Group is exposed tothe fierce competition thatcharacterises the industry, aswell as fluctuations in rawmaterial prices affectingworking capital.

Financial riskThe operations of the AAK

Group involve exposure tosignificant financial risks,particularly currency risks andraw material price risks.

Operational riskThe raw materials used in theoperation are agriculturalproducts, and availability maytherefore vary due to climaticand other external factors.

Accounting principles in2011This interim report is preparedin accordance with the SwedishAnnual Accounts Act andIAS 34, Interim FinancialReporting. For informationregarding the accountingpolicies applied, see the 2010Annual Report. The accountingpolicies are unchanged,compared with those applied in2010.

As from 1 October 2010, AAKhas started to use full hedgeaccounting based on fair valuehedging in accordance with IAS39. Therefore the companydoes not report any IAS 39impact commencing the firstquarter 2011.

DefinitionsFor definitions see the 2010Annual Report.

The Parent CompanyThe Parent Company's invoicedsales during third quarter 2011were SEK 32 million (31).The result for the ParentCompany after financial itemsamounted to negative SEK 28million (negative 10).

Interest-bearing liabilities minuscash and cash equivalents and

interest-bearing assets totallednegative SEK 42 million(positive 160 as at 31December 2010). Investmentsin intangible and tangibleassets amounted to SEK 0million (0).

The Parent Company's balancesheet and income statementare shown on pages 19-20.

Accounting policies

AarhusKarlshamn AB (publ) isthe Parent Company of theAAK Group. The Company hasprepared its financial reports inaccordance with the AnnualAccounts Act and RFR 2Reporting for legal entities.

Changes in the balancesheetNo major changes since year-end.


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Malm, November 7, 2011

Arne FrankChief Executive Officer and President

The information is that which AarhusKarlshamn AB (publ) is obliged to publish under the provisions ofthe Stock Exchange and Clearing Operations Act and/or the Trading in Financial Instruments Act.The information was released to the media for publication on November 7, 2011 at 08.15 am CET.


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Auditors Review Report

We have reviewed this report for the period 1 January 2011 to 30 September 2011 forAarhusKarlshamn AB (publ). The board of directors and the CEO are responsible for the preparationand presentation of this interim report in accordance with IAS 34 and the Swedish Annual AccountsAct. Our responsibility is to express a conclusion on this interim report based on our review.

We conducted our review in accordance with the Swedish Standard on Review Engagements SG2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consistsof making inquiries, primarily of persons responsible for financial and accounting matters, and applyinganalytical and other review procedures. A review is substantially less in scope than an audit conductedin accordance with International Standards on Auditing in Sweden, ISA, and other generally acceptedauditing standards in Sweden. The procedures performed in a review do not enable us to obtainassurance that we would become aware of all significant matters that might be identified in an audit.Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the interimreport is not prepared, in all material respects, in accordance with IAS 34 and the Swedish AnnualAccounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the ParentCompany.

Malm, November 7, 2011PricewaterhouseCoopers AB

Anders LundinAuthorised Public Accountant Lead Auditor


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AAK Group - Consolidated income statement

SEK Million

Q32011

Q32010

Q1-32011

Q1-32010

Rolling 12months*

Full year2010*

Full year2010

Net salesOther operating income

4,46217

3,7744

12,21290

10,87816

15,49640

14,80827

14,80846

Total operating income 4,479 3,778 12,302 10,894 15,536 14,835 14,854

Raw materials and supplies -3,591 -2,931 -9,770 -8,442 -11,970 -11,310 -11,271Other external expenses -277 -284 -772 -837 -1,162 -1,169 -1,169Cost for remuneration to employees -274 -296 -837 -862 -1,124 -1,146 -1,146Amortisation and impairment losses -89 -91 -269 -276 -374 -376 -376Other operating expenses -2 -1 -5 -5 -9 -10 -10Total operating income -4,233 -3,603 -11,653 -10,422 -14,639 -14,011 -13,972

Operating result (EBIT) 246 175 649 472 897 824 882

Interest income 1 2 4 6 7 8 8Interest expense -27 -15 -66 -44 -71 -59 -59Other financial items -26 3 -35 -2 -32 -3 -3Total financial net -52 -10 -97 -40 -96 -54 -54

Result before tax 194 165 552 432 801 770 828

Income tax -52 -44 -145 -123 -195 -187 -202

Net result 142 121 407 309 606 583 626

Attributable to non-controlling

interests

0 1 2 1 3 4 2

Attributable to the Parent companysshareholders

142 120 405 308 603 579 624

* Rolling 12 months and full-year 2010 are excluding the IAS 39 effect and insurance compensation.

AAK Group Comprehensive income

SEK Million

Q32011

Q32010

Q1-32011

Q1-32010

Rolling 12months

Full year2010

Income for the period 142 121 407 309 724 626Exchange differences on translationof foreign operations

56 -218 16 -208 -5 -229

Total comprehensive income forthe period

198 -97 423 101 719 397

Attributable to non-controllinginterests

-1 -1 0 1 0 2

Attributable to the Parent companysshareholders

199 -96 423 100 719 395


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AAK Group Condensed balance sheet

SEK Million 30.9.2011 30.9.2010 31.12.2010Assets

Goodwill 768 589 580Other intangible assets 104 90 102Tangible assets 2,775 2,753 2,718Financial assets 170 163 133Total non-current assets 3,817 3,595 3,533

Inventory 3,078 2,329 2,299Current receivables 3,054 2,345 2,880Cash and cash equivalents 253 313 540Total current assets 6,385 4,987 5,719

Total assets 10,202 8,582 9,252

Equity and liabilities

Shareholdersequity 3,414 2,853 3,164Non-controlling interests 19 23 24Total equity including non-controlling interests 3,433 2,876 3,188

Total non-current liabilities 4,188 3,679 3,486

Accounts payable 1,305 601 838Other current liabilities 1,276 1,426 1,740Total current liabilities 2,581 2,027 2,578

Total equity and liabilities 10,202 8,582 9,252

No changes have arisen in contingent liabilities.


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AAK Group Change in equity

SEK Million

Totalequity

capital

Noncontrolling

interests

Total equityincl. non-

controlling

interestsOpenings equity 1 January 2011 3,164 24 3,188Profit for the period 405 2 407Other comprehensive income 18 -2 16Total comprehensive income 3,587 24 3,611

Redemption non-controlling interest - -5 -5Stock options 11 - 11Dividend -184 - -184

Closing equity 30 September 2011 3,414 19 3,433

SEK Million

Totalequitycapital

Noncontrolling

interests

Total equityincl. non-

controllinginterests

Openings equity 1 January 2010 2,927 22 2,949Profit for the period 308 1 309Other comprehensive income -208 0 -208Total comprehensive income 100 1 101

Dividend -174 - -174

Closing equity 30 September 2010 2,853 23 2,876

AAK Group Cash flow statement

SEK Million

Q32011

Q32010

Q1-32011

Q1-32010

Full year2010

Operating activitiesCash flow from operating activities before change inworking capital

257 255 692 585 874

Changes in working capital -68 -340 -902 -360 -117Cash flow from operating activities 189 -85 -210 225 757

Investing activitiesCash flow from investing activities -410 -65 -573 -244 -331

Cash flow after investing activities -221 -150 -783 -19 426

Financing activitiesCash flow from financing activities -90 248 505 25 -188

Cash flow for the period -311 98 -278 6 238

Cash and cash equivalents at start of period 561 241 540 322 322Exchange rate difference for cash equivalents 3 -26 -9 -15 -20Cash and cash equivalents at end of period 253 313 253 313 540


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AAK Group Share data

SEK Million

Q3

2011

Q3

2010

Q1-3

2011

Q1-3

2010

Full year

2010Number of shares, thousand 40,898 40,898 40,898 40,898 40,898Earnings per share, SEK** 3.48 3.73 9.90 9.17 15.26Equity per share, SEK 83.49 69.77 83.49 69.77 77.38Market value on closing date 163.50 160.00 163.50 160.00 188.50

** The calculation of earnings per share is based on weighted average number of outstanding shares.No dilution from outstanding subscription options during the third quarter 2011.


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Quarterly data Business areas

Gross contribution

2010 2011

SEK Million Q1 Q2 Q3 Q4Full

year Q1 Q2 Q3Food Ingredients 413 443 448 522 1,826 391 412 477Chocolate & Confectionery Fats 333 310 379 372 1,394 326 320 354Technical Products & Feed 94 99 100 112 405 114 99 84Total AAK Group 840 852 927 1,006 3,625 831 831 915

Operating profit

2010 2011

SEK Million Q1 Q2 Q3 Q4Full

year Q1 Q2 Q3Food Ingredients 97 101 124 132 454 104 120 143Chocolate & Confectionery Fats 76 57 102 106 341 81 70 112Technical Products & Feed 25 28 29 36 118 39 28 15Group Functions -20 -22 -24 -23 -89 -20 -22 -24Total AAK Group 178 164 231 251 824 204 196 246

IAS 39 effect 15 -60 -56 140 39 - - -Insurance compensation - - - 19 19 - 48 -Non-recurring items - - - - - - -45 -Total legal operating profitAAK Group

193 104 175 410 882 204 199 246

Financial net -14 -16 -10 -14 -54 -15 -30 -52

Result before tax 179 88 165 396 828 189 169 194

Operating profit YTD 2011 by segments Inclusive

and Exclusive non-recurring items reported in Q2

2011

SEK MillionExcl non-recurring

items

Non-recurring

items

Incl non-recurring

itemsFood Ingredients 367 -45 322Chocolate Confectionery Fats 263 +56 319Technical Products & Feed 82 0 82Group Functions -66 -8 -74

Total AAK Group 646 +3 649


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Change in reporting for business areas Food

Ingredients and Technical Products & Feed

Starting with the first quarter of

2011, Groups operations incrushing will be reported as partof the business area TechnicalProducts & Feed. The crushingoperation has previously beenreported within the businessarea Food Ingredients.

Since 1st January 2011 the

crusher has been operated byproduct area Feed, which iswithin the business areaTechnical Products & Feed.Below are the sales, grosscontribution and operating profitfor the respective quarters in2010 according to the new

reporting structure. Earlier

reported volumes areunchanged after this change inreporting for AAK businessareas as reported volumesinclude only processedproducts and not sale of crudeoil.

Sales

SEK million 2010 Q1 Q2 Q3 Q4 FullYearFood Ingredients New 2,018 2,206 2,154 2,289 8,667

Old 2,062 2,241 2,233 2,391 8,927Technical Products & Feed New 389 367 416 495 1,667

Old 345 332 337 393 1,407

Gross contribution

SEK million 2010 Q1 Q2 Q3 Q4Full

Year

Food Ingredients New 413 443 448 522 1,826

Old 442 476 480 554 1,952Technical Products & Feed New 94 99 100 112 405

Old 65 66 68 80 279

Operating profit

SEK million 2010 Q1 Q2 Q3 Q4Full

Year

Food Ingredients New 97 101 124 132 454Old 101 107 130 137 475

Technical Products & Feed New 25 28 29 36 118

Old 21 22 23 31 97


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Parent company - Income statement

SEK Million

Q1-32011

Q1-32010

Full year2010

Net sales 32 31 42

Other operating income 2 2 2Total operating income 34 33 44

Other external expenses -36 -32 -47Cost for remuneration to employees -28 -35 -44Amortisation and impairment losses -1 -1 -1Other operating expenses 0 0 0Total operating expenses -65 -68 -92

Operating result (EBIT) -31 -35 -48

Interest income 124 124 164Interest expense -121 -99 -140Other financial items - - -Total financial net 3 25 24

Result before tax -28 -10 -24

Income tax -2 2 8

Net result -30 -8 -16

,

Parent company Comprehensive income

SEK Million

Q1-32011

Q1-32010

Full year2010

Net result for the period -30 -8 -16Other comprehensive income - - -Total comprehensive income forthe period

-30 -8 -16


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Parent company Condensed balance sheet

SEK Million 30.9.2011 30.9.2010 31.12.2010Assets

Other intangible assets 1 1 1Tangible assets 3 4 4Financial assets 7,055 7,663 7,667

Total non-current assets 7,059 7,668 7,672

Current receivables 137 126 54Cash and cash equivalents 0 0 0Total current assets 137 126 54

Total assets 7,196 7,794 7,726

Equity and liabilities

Shareholders equity 3,960 4,132 4,174Total equity 3,960 4,132 4,174

Total non-current liabilities 3,000 3,514 3,402

Accounts payable 5 3 11Other current liabilities 231 145 139Total current liabilities 236 148 150

Total equity and liabilities 7,196 7,794 7,726


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Information and contact details

Publication dates

The interim report for the fourth quarter and full-year for 2011 will be published on 9 February, 2012.

The interim report for the first quarter for 2012 will be published on 3 May, 2012.

The interim report for the second quarter for 2012 will be published on 19 July, 2012.

The interim report for the third quarter for 2012 will be published on 7 November, 2012.

The fourth quarter and full-year report for 2012 will be published on 9 February 2013.

The annual and quarterly reports are also published onwww.aak.com

Investor Relations contact:

Arne Frank, President and CEOPhone: + 46 40 627 83 00

Anders Bystrm, Chief Financial OfficerPhone: + 46 40 627 83 00

Fredrik Nilsson, Head of Investor RelationsPhone: + 46 40 627 83 34

Mobile: + 46 708 95 22 21E-Mail: [email protected]

AarhusKarlshamn AB (publ)Jungmansgatan 12, 211 19 Malm, SwedenPhone: + 46 40 627 83 00, Reg. No. 556669-2850, www.aak.com
http://www.aak.com.com/http://www.aak.com.com/http://www.aak.com.com/http://www.aak.com.com/

Documents

AarhusKarlshamn AB Q3 ENG 2011