===== SIDA 1 ===== Sectra’s three-month interim report 2023/2024 1 (28) REPORT PRESENTATION September 5, 2023 at 10:00 a.m. CEST Follow online: https://investor.sectra.com/q1report2324 Three-month report 2023/2024 Record-high order bookings Sectra’s contracted order bookings exceeded SEK 2.9 billion during the quarter. Demand for the company’s customer offerings in both medical imaging IT and secure communication contributed to this historically high level for a single quarter. Net sales and recurring revenue are growing. Currency movements continued to have an advantageous effect on the company’s financial outcome and dampened the impact of ongoing investments in the transition to service sales and cloud-based deliveries. During the quarter, several hospitals deployed Sectra’s cloud services for medical diagnostic imaging and one of the largest hospital chains in the US ordered these services. FINANCIAL OUTCOME IN BRIEF Figures in parentheses pertain to the corresponding period/quarter in the preceding fiscal year. First quarter: May–July 2023 • Contracted order bookings rose 32.9% to SEK 2,970.0 million (2,235.4), of which SEK 344.4 million (705.3) pertained to guaranteed order bookings. Of the guaranteed order bookings, 28% were recognized during the quarter and a further 31–41% are deemed to pertain to revenue within 12 months after the end of the quarter. • Net sales increased 20.6% to SEK 583.7 million (484.1). Based on unadjusted exchange rates, the increase was 14.2%. Recurring revenue accounted for SEK 397.2 million (310.4) of net sales, up 28.0%. Based on unadjusted exchange rates, the increase was 21.4%. Cloud recurring revenue (CRR) increased 72.8% to SEK 86.4 million (50.0). • Operating profit rose 7.6% to SEK 69.3 million (64.4), corresponding to an operating margin of 11.9% (13.3). Based on unadjusted exchange rates, operating profit decreased 5.3%. • Profit for the period amounted to SEK 61.6 million (54.1). • Cash flow from operations amounted to SEK -98.3 million (-64.1). Key figures Quarter 12 months SEK million Q1 Q1 Δ Rolling Full-year Δ 23/24 22/23 % 23/24 22/23 % Contracted order bookings 2,970.0 2,235.4 32.9 5,370.3 4,635.7 15.8 of which guaranteed order bookings 344.4 705.3 -51.2 2,245.6 2,606.5 -13.8 Net sales 583.7 484.1 20.6 2,450.4 2,350.8 4.2 of which recurring revenue 397.2 310.4 28.0 1,446.7 1,359.9 6.4 of which cloud recurring revenue (CRR) 86.4 50.0 72.8 291.0 254.6 14.3 Operating profit 69.3 64.4 7.6 460.6 455.7 1.1 Operating margin, % 11.9 13.3 n/a 18.8 19.4 n/a Profit for the period 61.6 54.1 13.9 382.5 375.0 2.0 Earnings per share, SEK 1 0.32 0.28 14.3 1.98 1.95 1.5 Cash flow from operations -98.3 -64.1 -53.4 406.3 440.5 -7.8 Average no. of employees 1,112 975 14.1 1,049 1,015 3.3 1 Before and after dilution. ===== SIDA 2 ===== Sectra’s three-month interim report 2023/2024 2 (28) Torbjörn Kronander, President and CEO CEO’S COMMENTS The first quarter was characterized by significant trust shown by customers in both secure communication and medical imaging IT. We are experiencing a turnaround in secure communication, with high demand and deliveries. We also passed important milestones in the transition to cloud- based solutions for medical diagnostic imaging. These successes demonstrate the value we provide for our customers and that our long- term initiatives in research and development are paying off. Contracted order bookings once again exceeded previous record- breaking levels. All operating areas are showing strong sales growth, which is a result of our desire to have satisfied customers and to offer the latest technology in our areas. I am pleased to report that in the most recent quarter , it was Secure Communications that displayed the strongest improvement. The operating area has achieved a turnaround after a few tough years and the future now looks bright. In medical imaging IT, we have e ntered a phase where ongoing strategic investments in subscription services and cloud deliveries are now having a clearer impact on profitability than in the previous year. Moreover, this development reflects our proactive response to industry trends and a im for long- term sustainable growth. We have also prepared for major deliveries that will continue for several years to come, primarily in North America. This included hiring personnel who are still in the onboarding phase. Sectra’s success is the result of a long- term approach—both to research and development and when it comes to establishing good relationships with satisfied customers who then expand their use of Sectra’s solutions and recommend us to others. The major procurement we secured in the US du ring the quarter is an excellent example of this. Our relationship began when we developed a solution for ophthalmology imaging that the customer has been using for the past few years. Now that they plan to replace their old system for radiology, they have decided to continue building on a solution and supplier with whom they are satisfied and expand their system to include our services for medical diagnostic imaging, Sectra One Cloud. In the long term, the contract includes an expansion into additional diagnostic imaging areas to create a more unified and cost -efficient organization. This is only one of several orders in Imaging IT Solutions from the past year that confirms our ability to manage the enterprise imaging needs of extremely large healthcare pro viders, something that offers benefits to customers in three areas: costs, opportunities for integrated diagnostics and better data security through fewer systems. Regardless of their size or infrastructure problems, we can help to reduce costs and complexity for customers by replacing traditional on-premises solutions with cloud services. We have laid the foundation for the transition through major investments in business and product development as well as an organization for cloud deliveries. These initi atives involve substantial initial costs and will not generate revenue until a later stage. This transition to service sales will ultimately contribute to more stability and overall improvements as well as a more long-term business than license sales. However, growth in sales and profit will be weaker in the short to medium term. The most important key figures we use to measure the progress of the transition are recurring revenue and cloud recurring revenue. The figures for the quarter show that things are moving at a rapid pace. The Sectra One model has a key role to play in this. During the quarter, the first customers in the UK and US to order Sectra One Cloud running in public clouds began to use the services. Additional customers have ordered our cloud services over the past year and several deployment projects are ongoing. Our progress during the quarter has strengthened Sectra’s position for the future and is paving the way for sustainable and long- term growth. With satisfied customers and an innovation-driven approach, I look forward to working with our current and future customers to lead the development of a healthcare system that can overcome the enormous challenges of the future as we move toward a safer and more secure society. ===== SIDA 3 ===== Sectra’s three-month interim report 2023/2024 3 (28) FINANCIAL GOALS Sectra’s overall operational target is to create high customer value in our markets. Delivering customer value is also the Group’s most important sustainability target since our customers’ work to treat patients, cure diseases and increase cybersecurity is vital for functioning societies. Sectra’s customers should be so satisfied with their experience that they remain for a long time, expand their use of our solutions and recommend Sectra to others. Customer satisfaction cannot be achieved without satisfied and dedicated employees. Employees who are motivated, understand their customers, feel good and are satisfied in their jobs will also increasingly develop new, creative solutions that can further increase the value we provide for Sectra’s customers. A healthy financial performance is naturally also essential. This is what pays our employees’ salaries and enables continued innovation and the investments needed to continue creating the substantial customer value and customer satisfaction that we strive for. Sectra has three Group-wide financial goals. Stability and profitability are considered fundamental goals. Once these goals have been met, the focus shifts to earnings growth, which in practice is our primary financial goal. All result indicators exceed the target levels by a comfortable margin. The financial goals are (in order of priority): 3. Earnings growth: Growth for operating profit/share over a five-year period ≥50% 1. Stability: Equity/assets ratio ≥30% 2. Profitability: Operating margin ≥15% 51% Goal 19% Goal 113% Goal Diagrams and amounts in the financial report Bars show the outcome per quarter and lines show the outcome for the rolling 12-month period (R12). Amounts are restated in SEK million unless otherwise indicated. ===== SIDA 4 ===== Sectra’s three-month interim report 2023/2024 4 (28) EVENTS First quarter Imaging IT Solutions • Sectra signed a contract with a US-based health system serving a multi-million strong patient community. The contract concerned Sectra One Cloud, the cloud subscription service for diagnostic imaging, which will run in a public cloud. The contracted order value for the implementation and use of the service initially amounted to SEK 2.4 billion (USD 227 million), if the full term of the contract is realized until 2033, although no part is guaranteed order bookings. • Three healthcare providers who previously ordered Sectra One Cloud deployed the service during the first quarter. • Amstelland Hospital in the Netherlands ordered Sectra’s enterprise imaging solution as a subscription, Sectra One. Secure Communications • Sectra and the engineering consulting company AFRY entered into a partnership to strengthen cybersecurity in operations critical to society in Sweden. Group • Sectra signed an agreement to acquire a limited-liability company that owns two properties, Teknikringen 20 (Sectra’s head office) and Teknikringen 16. The company will become a wholly owned subsidiary of Sectra AB. The acquisition is not expected to have a significant effect on the Sectra Group’s financial outcome. The transfer and possession took place on September 1, 2023. After the end of the reporting period • No events of significant importance for the assessment of Sectra’s earnings and financial position took place between the balance-sheet date and the publication date of this interim report. For further information about these events, visit https://sectra.com/news At the beginning of August, the U.S. News & World Report published its annual ranking of the best hospitals in the US. Nine of the 22 hospitals included on the list use medical imaging solutions from Sectra. We are proud that these prominent hospitals have chosen to partner with us. Together with our customers, we are dedicated to developing the healthcare sector so they can provide high-quality patient care. ===== SIDA 5 ===== Sectra’s three-month interim report 2023/2024 5 (28) SECTRA’S MARKETS Sectra plays a key role in meeting the need for medical imaging IT and cybersecurity. We help solve major social problems in changing markets, where scope for expansion remains. The global trends of an aging population and increased digitization in society mean that these markets are expected to continue to grow even in a weaker economic climate. Our customers operate in some of society’s most critical functions, which makes our brand an important symbol for reliability, trustworthiness and stability. Our job is to help customers become more efficient and give them the tools needed to make people’s lives healthier, safer and more secure. In line with Sectra’s vision, this is how the company creates value for its customers, shareholders and society as a whole. IT support for more efficient care and medical education Today’s demographic development and increased survival rates among cancer patients are putting pressure on healthcare. The ag ing population of the industrialized world entails major challenges. At the same time, the proportion of people of working age is decreasing. In order to maintain high quality of care with fewer people taking care of more patients, healthcare must become more efficient. The growing population of senior citizens is also shining a spotlight on diseases affecting the el derly. The treatment of patients with cancer and skeletal diseases, for example, entails enormous challenges. These diseases represent some of the most costly and resource-intensive areas in the healthcare sector and are dependent on medical diagnostic imaging. Healthcare providers across the globe use Sectra’s expertise and solutions in medical IT not only to increase productivity and coordinate their resources but also to improve efficiency in orthopaedic surgery through better planning and follow-up. The rapidly growing number of genetic analyses for cancer diagnostics, conducted alongside pathology analyses, is also contributing to a growing market. Sectra also helps t o raise the quality of medical education by providing solutions where the user can inte ract with medical images and share educational materials. We are noting increasing synergies between our operating areas since healthcare is being exposed to cybercrime at an accelerating rate, resulting in, for example, the authorities in the US issuing a particular warning to healthcare providers. We enable our customers to take care of more patients and save more lives at a long -term sustainable cost. This work is carried out in our Imaging IT Solutions and Business Innovation operating areas. Cybersecurity for a more stable and safer society The ability to safely and efficiently handle and transmit sensitive information is central to the stability and security of s ociety, particularly when it comes to critical social functions and critical infr astructure. The players in these areas rely on products and services that increase cybersecurity. We have extensive experience of protecting society’s most critical communications and control systems and we are a strong brand in the niche markets of encryption and secure mobile communications. IT developments in society, political instability in the world, and the growth of cybercrime are creating a greater need for Sectra’s expertise and product offerings. We help customers to provide increased security, thereby contributing to a more stable and safer society. This work is carried out in the Secure Communications operating area. COMMENTS ON THE GROUP’S FINANCIAL OUTCOME Order bookings Total contracted order bookings for the quarter amounted to SEK 2,970.0 million (2,235.4), up 32.9% from the comparative quarter which also included several major customer contracts. A total of SEK 344.4 million (705.3) was guaranteed order bookings. The r atio of contracted order bookings to net sales for the latest rolling 12 -month period totaled 2.2, up from 2.0 at the end of the previous fiscal year. Demand for the company’s customer offerings in both medical imaging IT and secure communication contributed to the increase in contracted order bookings from the comparative quarter. The outcome includes comprehensive, long- term customer contracts, for example for managing large volumes of medical images. The most recent quarter includes one such new contract with a major healthcare provider in the US. If the full term of the contract is realized until 2033, the order value amounts to approximately SEK 2.4 billion (USD 227 million), of which no part is guaranteed. Orders of this size are not secured every qua rter and therefore lead to significant variations in order bookings between individual quarters and periods. Contracted order bookings, SEK million ===== SIDA 6 ===== Sectra’s three-month interim report 2023/2024 6 (28) Net sales Net sales increased 20.6% to SEK 583.7 million (484.1). Based on unadjusted exchange rates, consolidated sales increased 14.2%. All operating areas reported an increase from the comparative quarter. The ongoing transition to selling products and software as services, of which cloud deliveries account for a quickly growing share, contributed to an increase in recurring revenue. Recurring revenue accounted for SEK 397.2 million (310.4) of sales. This represents an increase of 28.0% and based on unchanged exchange rates an increase of 21.4%. Lost recurring revenue (recurring revenue churn) for the last 12- month period was 0.9%. During the quarter, cloud recurring revenue (CRR) increased 72.8% to SEK 86.4 million (50.0). Non-recurring revenue also increased from the comparative quarter, primarily due to sales growth for Secure Communications. Sectra is growing in all geographic markets except for the US, where the outcome for the quarter was affected by the transiti on to service sales and cloud deliveries. The operations in the UK reported the largest individual sales increase from the comparat ive quarter, primarily through increased recurring revenue . More than 70% of the Group’s net sales are carried out in foreign currency, primarily EUR, GBP and USD, which entails a relatively large sensitivity to currency fluctuations. Sales and recurring revenue, SEK million Sales by geographic market, SEK million Sales trend per geographic market, SEK million Compared with the corresponding period in the preceding fiscal year Sales trend per operating area, SEK million Compared with the corresponding period in the preceding fiscal year Total Increase Decrease ===== SIDA 7 ===== Sectra’s three-month interim report 2023/2024 7 (28) Result The Group’s operating profit increased 7.6% to SEK 69.3 million (64.4), mainly due to the strong performance of Secure Communications. Currency fluctuations continued to have a positive effect on the Group’s financial outcome. Based on unadjust ed exchange rates, the Group’s operating profit decreased 5.3% from the comparative quarter. The operating margin amounted to 11.9% (13.3). The operating margin was impacted by the shift to service sales and cloud deliveries in Imaging IT Solutions, the implementation of services and infrastructure for new customers, and increased marketing activities from the comparative quarter. The Group’s financial items amounted to SEK 8.2 million (3.8). Financial items improved primarily due to increased interest income. Currency fluctuations had an impact of SEK 3.1 million (2.5) on the Group’s financial items. Sectra does not hedge its operations, and currency fluctuations therefore have an immediate impact on profit or loss or on comprehensive income. Profit after financial items amounted to SEK 77.5 million (68.2). This outcome corresponds to a profit margin of 13.3% (14.1). Earnings per share before and after dilution amounted to SEK 0.32 (0.28). Financial position and cash flow The Group’s cash and cash equivalents at the end of the reporting period amounted to SEK 688.2 million (724.4). In addition to this, the Group has a short-term investment of SEK 120.0 million (0). The Group’s debt/equity ratio was 0.06 (0.05) as of the balance -sheet date. Interest -bearing lease liabilities amounted to SEK 78.0 million (58.1). The Group’s total cash flow for the period amounted to SEK - 144.0 million (-87.9). The decrease compared with the comparative quar ter is mainly due to changes in the cash flow from operations. Cash flow from operations amounted to SEK - 98.3 million ( -64.1) during the quarter. The change from the comparative quarter is the result of an increase in capital tied up in accounts receivable and customer projects as well as hedging of components for future delivery of orders received. Cash flow per share was SEK -0.51 (-0.33). Cash flow from investing activities amounted to SEK - 38.9 million ( -18.1). Refer to the information about investing activities on the next page. Total Increase Decrease Operating profit trend per operating area, SEK million Compared with the corresponding period in the preceding fiscal year Operating profit, Group, SEK Cash flow from operations, Group, SEK million ===== SIDA 8 ===== Sectra’s three-month interim report 2023/2024 8 (28) Investments and depreciation/amortization Investments for the period amounted to SEK 38.9 million (18.1). The outcome includes capitalized work for own use of SEK 18.0 million (9.0) and the deposit paid for the acquired properties. Capitalization, which includes the development of cloud-based services for medical diagnostics, increased from the comparative quarter in all operating areas. Total depreciation and amortization for the period was SEK 24.5 million (22.2), of which SEK 9.1 million (8.8) was attributable to capitalized development expen - ditures. At the end of the period, capitalized development expenditures totaled SEK 180.2 million (149.9). Seasonal variations Sectra has historically experienced major seasonal variations, since individual projects can be very large relative to Sectra’s sales. This applies for both medical systems and encryption systems. The beginning of the fiscal year is usually weaker since few customers want to deploy new systems during the summer. The variations in order volumes between individual quarters are significant since certain contracts are very large and have long terms. As Sectra transitions to selling products as a service, this variation is expected to gradually decrease over the next several years since revenue will be spread more evenly over time. For further information about seasonal patterns, refer to Sectra’s Annual and Sustainability Report for the 2022/2023 fiscal year. Capitalized development expenditures, SEK million Read Sectra’s Annual Report and Sustainability Report: https://investor.sectra.com/reports/annual-reports ===== SIDA 9 ===== Sectra’s three-month interim report 2023/2024 9 (28) OPERATING AREA IMAGING IT SOLUTIONS Quarter 12 months Q1 Q1 Δ Rolling Full-year Δ 23/24 22/23 % 23/24 22/23 % Sales, SEK million 518.6 435.8 19.0 2,161.8 2,079.0 4.0 of which recurring external revenue 370.7 288.1 28.7 1,340.6 1,258.1 6.6 of which cloud recurring revenue 83.0 47.2 75.8 277.0 241.2 14.8 Operating profit, SEK million 74.3 80.4 -7.6 456.3 462.4 -1.3 Operating margin, % 14.3 18.4 n/a 21.1 22.2 n/a Major regional healthcare providers are choosing Sectra, customers are expanding their use of our solutions from one to several medical imaging areas, and demand for deliveries of medical diagnostics as a service is increasing . This is contributing to growth in order bookings, net sales and recurring revenue for Imaging IT Solutions. The major order for Sectra One Cloud from a healthcare provider in the US, with a contracted order value of approximately SEK 2.4 billi on, meant the operating area again surpassed its earlier records for contracted order bookings. The customer already uses Sectra’s solution for ophthalmology and the order means they will now use Sectra’s cloud -based services for radiology. In the long ter m, the customer intends to also use these services for pathology, cardiology and orthopaedics. During the quarter, Sectra also secured new orders for its digital pathology solution from hospitals in countries including the US and Switzerland. Three customers deployed Sectra One Cloud during the first quarter, one of which in the UK and two in the US. These are first in each country to use Sectra One Cloud. However, this progress is not yet fully reflected in the outcome since the customers’ use of the servi ces is expected to gradually grow. One of the cloud installations during the quarter was also the first through the partnership organization, where Sectra One Cloud entails improved prospects to expand operations. The operating area’s profitability was affected by the implementation of services and infrastructure for new customers and ongoing investments, with a major focus on transitioning from traditional software deliveries to service sales and cloud -based deliveries. The shift has proceeded very rapidly and the effects were larger than during the comparative quarter. At the same time, currency movements remained advantageous, which partly offset the transition. Trend, SEK million Demand in the market for medical imaging IT is being driven by consolidation in the healthcare sector, growing volumes of medical images and the replacement of older IT systems. This is leading to larger customers, more exten sive procurements than before, and greater demands on an even more structured work method. Sectra is well positioned to help the healthcare sector increase its productivity, improve patient care and make the best use of available resources. Sales Operating profit ===== SIDA 10 ===== Sectra’s three-month interim report 2023/2024 10 (28) OPERATING AREA BUSINESS INNOVATION Quarter 12 months Q1 Q1 Δ Rolling Full-year Δ 23/24 22/23 % 23/24 22/23 % Sales, SEK million 16.7 12.7 31.5 77.8 73.8 5.4 of which recurring external revenue 3.7 2.9 27.6 15.5 14.7 5.4 of which cloud recurring revenue 3.4 2.7 25.9 14.0 13.4 4.5 Operating profit, SEK million -1.0 -1.8 44.4 11.3 10.5 7.6 Operating margin, % neg neg n/a 14.5 14.2 n/a Business Innovation comprises the Genomics IT, Medical Education and Orthopaedics business units. This area also reports the expenses for research activities, which largely focus on initiatives in the field of AI for medical applications. Recurring revenue is growing quickly, and the financial outcome in terms of sales and operating profit showed a positive trend compared with the comparative quarter. However, the results may vary significantly between quarters and periods. The new business models will result in higher recurring revenue, resulting in less variation in the long term. Sales Operating profit At the end of 2022, the Sectra Education Portal was incorporated into the curriculum at the University of Bradford, West Yorkshire, in England. Our collaboration with the university has given both students and educators an opportunity to reshape how knowle dge is acquired and shared. In an interview, Dr Keren Bielby- Clarke, an Associate Professor at the Faculty of Life Sciences at the University of Bradford, where she teaches anatomy and physiology, explains how their journey to introduce innovative technolo gy could revolutionize teaching in various disciplines: medical.sectra.com/case/cross-disciplinary-learning- enabled-through-cloud-based-solution/ Trend, SEK million ===== SIDA 11 ===== Sectra’s three-month interim report 2023/2024 11 (28) OPERATING AREA SECURE COMMUNICATIONS Quarter 12 months Q1 Q1 Δ Rolling Full-year Δ 23/24 22/23 % 23/24 22/23 % Sales, SEK million 56.3 41.6 35.3 249.2 234.5 6.3 of which recurring external revenue 22.8 19.2 18.8 90.1 86.5 4.2 Operating profit, SEK million 2.6 -6.5 140.0 28.2 19.2 46.9 Operating margin, % 4.6 neg n/a 11.3 8.2 n/a The uncertain geopolitical situation, with an ongoing war in Europe and further tensions worldwide, continues to highlight the importance of defense capabilities and public security. This, in turn, is placing greater demands on communication and fueling the need for investments in high assurance products, encryption development and cybersecurity both in Sweden and in the rest of Europe. Secure Communications’ opportunities to help customers in this situation continued to contribute to strong order bookings during the quarter for both development assignments and product sales as well as support and service commitments. The financial outcome in terms of sales and earnings was substantially better than in the year-earlier quarter. The long -term trend is positi ve, although outcomes naturally vary greatly between quarters due to the nature of the operations. During the first quarter, Sectra received additional product orders and assignments, primarily from Swedish authorities to improve the civil and military defense’s ability to communicate securely. These orders indicate that the market situation has normalized after the pandemic years, although certain challenges remain. Demand for our solutions is growing, while the global shortage of components an d strained labor market continue to impact the growth rate. Budget appropriations for cybersecurity for the defense forces, authorities and critical infrastructure have increased, and we are well positioned with offerings that meet customers’ stringent dem ands. To meet increased needs and new regulations, during the last few years we have made extensive investments in our development environment, which is now approved and operational. Ongoing initiatives in Secure Communications also include new offerings w ith the potential to contribute to substantial customer value and growth in all product segments. In line with prioritized activities to ramp up our initiatives, supplement our customer offerings and broaden our market, we have entered into a partnership w ith AFRY in the area of critical infrastructure. Together we offer a complete and flexible security solution for operational technology (OT) systems in critical infrastructure and other operations essential to society, starting in the Swedish market. Quantum-proof encryption Quantum computers pose a major security threat that must be addressed to keep information confidential for a long time. Typically, classified information at the SECRET level must be kept secure for more than 30 years, even in the event of an attack from a quantum computer. Sectra is at the forefront in this field. Independent security authorities have determined that our EU and NATO-approved crypto solution Tiger/S can protect from future quantum computer attacks. In this article, you can read about what quantum technology is and where it came from: communications.sectra.com/resources/quantum-technology-glimpses-of-potential-technological- advancements/ Sales Operating profit Trend, SEK million ===== SIDA 12 ===== Sectra’s three-month interim report 2023/2024 12 (28) OTHER OPERATIONS Quarter 12 months Q1 Q1 Δ Rolling Full- year Δ 23/24 22/23 % 23/24 22/23 % Sales, SEK million 34.6 26.6 30.1 132.7 124.7 6.4 Operating profit, SEK million -6.5 -7.8 16.7 -35.0 -36.2 3.3 Operating margin, % neg neg n/a neg neg n/a Other Operations pertain to Sectra’s joint functions for administration, recruitment, Group finance, IT, regulatory affairs, people and brand, and activities related to investors. The change from the comparative quarter mainly pertained to increased central management of costs distributed across the organization. PARENT COMPANY The Parent Company’s income statement and balance sheet are reported on page 17. The Parent Company Sectra AB includes the research department for medical imaging IT, the Genomics IT business unit and the head office’s joint functions (see Other Operations above). 2023 AGM AND PROPOSED SHARE REDEMPTION PROGRAM The AGM will be held on September 7, 2023 in Linköping. Visit the event page https://investor.sectra.com/agm2023 for further information and documents. Proposed share redemption program/dividend For the 2022/2023 fiscal year, the Board and the President propose that the AGM resolve to distribute SEK 1.10 per share to the shareholders through a 2:1 share split in combination with a mandatory redemption process. The corresponding distribution to the shareholders in the preceding year was SEK 1.00 per share. The proposal was announced in Sectra’s year -end report published on June 2, 2023. THE SHARE Share capital and number of shares Sectra’s share capital on the balance-sheet date totaled SEK 38,824,179, distributed between 194,120,895 shares and 312,052,035 voting rights. The number of shares is distributed between 13,103,460 Class A shares and 181,017,435 Class B shares. Sectra’s holding of treasury shares at the end of the period amounted to 1,453,406 Class B shares, corresponding to 0.7% of the share capital and 0.5% of the voting rights in the company. For more information, refer to Note 3. Authorization The Board of Directors was authorized by the 2022 AGM, during the period until the 2023 AGM, to decide on new share issues of a maximum of 18,500,000 Class B shares and to decide on the acquisition and divestment of all of the company’s treasury shares. As of the publication date of this report, these authorizations have not been utilized. The complete authorization is presented in the minutes from the AGM: https://investor.com/agm2023. At the time of publication of this financial report, the Board had not utilized these authorizations. RISKS AND UNCERTAINTIES Through its operations, Sectra is exposed to such business risks as dependence on major customers and partners, the effect of currency fluctuations on pricing in the markets in which the Group is active, and property and liability risks. Sectra is also exposed to various types of financial risks such as currency, interest-rate, credit and liquidity risks. A detailed description of the risks and specific external factors as well as Sectra’s strategies and tactics for minimizing risk exposure and limiting adverse effects are provided in the Administration Report in the Group’s Annual and Sustainability Report for the 2022/2023 fiscal year in the administration report on pages 83–85 and in Note 29 on pages 115–116. No events have occurred that would alter the conditions reported. Timetable for the 2023 redemption process Sep 7 Resolution by AGM Oct 6 Final day of trading in the Sectra share, including rights to redemption shares Oct 9 First day of trading in the Sectra share, excluding rights to redemption shares Oct 10 Record date for the share split Oct 11–20 Trading in redemption shares Oct 24 Record date to revoke redemption shares Oct 27 Preliminary date for payment of redemption settlement from Euroclear ===== SIDA 13 ===== Sectra’s three-month interim report 2023/2024 13 (28) FOR FURTHER INFORMATION Contact Sectra’s CEO Torbjörn Kronander, telephone +46 13 23 52 27 or email info.investor@sectra.se. Presentation of the interim report Time: September 5, 2023 at 10:00 a.m. CEST Torbjörn Kronander, President and CEO of Sectra AB, and Jessica Holmquist, CFO of Sectra AB, will present the financial report and answer questions. The presentation will be held in English. For information about participating online or to listen to the recording afterwards, visit: https://investor.sectra.com/q1report2324. Financial calendar and AGM 2023 AGM September 7, 2023 at 4:00 p.m. (CEST) Six-month report December 15, 2023 at 8:15 a.m. (CET) Nine-month report March 8, 2024 at 8:15 a.m. (CET) Year-end report June 5, 2024, at 8:15 a.m. (CEST) For other IR events, visit: https://investor.sectra.com/events-and-presentations/ ASSURANCE The Board of Directors and the President of Sectra AB (publ) hereby assure that the interim report for the May 1–July 31, 2023 period provides a true and fair view of the Parent Company’s and Group’s operations, financial position and earnings and describes the significant risks and uncertainties facing the Parent Company and other companies in the Group. Linköping, September 5, 2023 Torbjörn Kronander Jan-Olof Brüer Tomas Puusepp Birgitta Hagenfeldt President, CEO and Board member Chairman Board member Board member Ulrika Unell Anders Persson Fredrik Robertsson Board member Board member Board member Filip Klintenstedt Andreas Örnéus Board member and employee representative Board member and employee representative This report was not reviewed by the company’s auditor. This information constitutes information that Sectra AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and/or the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out in the press release, at 8:15 a.m. CEST on September 5, 2023. Sectra AB (publ), Corporate Registration Number 556064-8304, https://sectra.com, email info@sectra.com ===== SIDA 14 ===== Sectra’s three-month interim report 2023/2024 14 (28) GROUP Condensed consolidated income statements SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Net sales (Note 4) 583,739 484,089 2,450,402 2,350,752 Capitalized work for own use 17,970 8,970 64,661 55,661 Other operating income 1,320 117 2,783 1,580 Total income 603,029 493,176 2,517,846 2,407,993 Goods for resale -71,079 -45,664 -288,312 -262,897 Personnel costs -319,715 -263,568 -1,225,476 -1,169,329 Other external costs -118,385 -97,387 -449,173 -428,175 Depreciation/amortization and impairment -24,537 -22,207 -94,269 -91,939 Total operating expenses -533,716 -428,826 -2,057,230 -1,952,340 Operating profit 69,313 64,350 460,616 455,653 Total financial items 8,213 3,822 28,128 23,737 Profit after financial items 77,526 68,172 488,744 479,390 Taxes -15,970 -14,043 -106,360 -104,433 Profit for the period 61,556 54,128 382,384 374,957 Profit for the period attributable to: Parent Company owners 61,556 54,128 382,384 374,957 Earnings per share Before dilution, SEK 0.32 0.28 1.98 1.95 After dilution, SEK (Note 3) 0.32 0.28 1.98 1.95 Consolidated statement of comprehensive income SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit for the period 61,556 54,128 382,384 374,957 Items that may be reversed in profit or loss Translation differences 20,894 8,424 30,093 17,623 Total other comprehensive income for the period 20,894 8,424 30,093 17,623 Total comprehensive income for the period 82,450 62,552 412,477 392,580 Comprehensive income for the period attributable to: Parent Company owners 82,450 62,552 412,477 392,580 ===== SIDA 15 ===== Sectra’s three-month interim report 2023/2024 15 (28) Condensed consolidated balance sheets SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Assets Intangible assets and goodwill 248,631 217,917 236,969 Tangible assets 74,306 65,817 74,556 Right-of-use assets 80,776 60,506 84,905 Financial assets 133,265 138,331 125,224 Deferred tax assets 6,779 6,369 6,632 Total fixed assets 543,757 488,940 528,286 Accounts receivable 431,692 308,211 386,153 Other current assets 67,772 57,580 57,545 Prepaid expenses and accrued income 876,756 510,001 819,441 Short-term investments 120,000 – 120,000 Cash and bank balances 688,210 724,353 825,242 Total current assets 2,184,430 1,600,145 2,208,381 Total assets 2,728,187 2,089,085 2,736,667 Equity and liabilities Equity 1,386,349 1,145,988 1,296,669 Deferred tax liabilities 6,095 4,400 5,928 Provisions 13,685 9,129 12,461 Non-current lease liabilities 52,135 33,576 56,968 Other long-term liabilities – 516 – Total long-term liabilities 71,915 47,621 75,357 Provisions 3,158 2,230 1,682 Current lease liabilities 25,865 24,085 25,294 Other current liabilities 136,938 150,607 204,983 Accrued expenses and deferred income 1,103,962 718,554 1,132,682 Total current liabilities 1,269,923 895,476 1,364,641 Total equity and liabilities 2,728,187 2,089,085 2,736,667 ===== SIDA 16 ===== Sectra’s three-month interim report 2023/2024 16 (28) Consolidated cash-flow statements SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 Full-year May–Apr 2022/2023 Operating activities Operating profit 69,313 64,350 455,653 Adjustment for non-cash items 38,888 24,241 121,351 Interest and dividends received 5,597 1,608 11,849 Interest paid -434 -313 -2,062 Income tax paid -32,632 -14,819 -71,635 Cash flow from operations before changes in working capital 80,732 75,067 515,156 Changes in working capital Change in inventories -1,080 581 -12,825 Change in receivables -64,075 50,034 -299,595 Change in current liabilities -113,875 -189,813 237,752 Cash flow from operations -98,298 -64,131 440,488 Investing activities Acquisitions of intangible assets -18,599 -8,970 -55,752 Acquisitions of tangible assets -20,301 -9,110 -37,036 Short-term investment – – -120,000 Cash flow from investing activities -38,900 -18,080 -212,788 Financing activities Repayment of lease liabilities -6,786 -5,721 -26,627 Redemption of shares – – -192,662 Cash flow from financing activities -6,786 -5,721 -219,289 Cash flow for the period -143,985 -87,932 8,411 Cash and cash equivalents, opening balance 825,242 808,775 808,775 Exchange-rate difference in cash and cash equivalents 6,953 3,510 8,056 Cash and cash equivalents, closing balance 688,210 724,353 825,242 Condensed consolidated statement of changes in equity SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 Full-year May–Apr 2022/2023 Equity at start of period 1,296,669 1,080,737 1,080,737 Comprehensive income for the period 82,450 62,552 392,580 Dividend/redemption of shares – – -192,662 Settlement of share-related payments 7,230 2,699 16,014 Equity at end of period 1,386,349 1,145,988 1,296,669 ===== SIDA 17 ===== Sectra’s three-month interim report 2023/2024 17 (28) PARENT COMPANY Condensed Parent Company income statements SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Net sales 34,874 27,274 136,245 128,645 Capitalized work for own use 1,106 662 4,091 3,647 Other operating income 10 24 210 224 Total income 35,990 27,960 140,546 132,516 Goods for resale -3,539 -128 -6,241 -2,830 Personnel costs -14,385 -12,871 -61,737 -60,223 Other external costs -25,686 -23,250 -109,731 -107,295 Depreciation/amortization -399 -405 -1,482 -1,488 Total operating expenses -44,009 -36,654 -179,191 -171,836 Operating profit -8,019 -8,694 -38,645 -39,320 Total financial items 69,479 3,860 80,803 15,184 Profit after financial items 61,460 -4,834 42,158 -24,136 Appropriations – – 436,014 436,014 Profit/loss before tax 61,460 -4,834 478,172 411,878 Tax on earnings for the period 5 996 -86,018 -85,027 Profit/loss for the period 61,465 -3,838 392,154 326,851 Parent Company statement of comprehensive income SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit for the period 61,465 -3,838 392,154 326,851 Total comprehensive income for the period 61,465 -3,838 392,154 326,851 Condensed Parent Company balance sheets SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Assets Intangible assets 4,752 779 3,647 Tangible assets 5,266 3,828 3,699 Financial assets 256,321 145,240 226,245 Total fixed assets 266,340 149,847 233,591 Accounts receivable 0 1,034 240 Receivables from Group companies 533,885 496,990 664,145 Other current assets 34,703 36,982 25,871 Short-term investments 120,000 – 120,000 Cash and bank balances 517,342 590,129 662,611 Total current assets 1,205,930 1,125,135 1,472,867 Total assets 1,472,270 1,274,982 1,706,458 Equity and liabilities Restricted equity 270,032 265,967 268,927 Unrestricted equity 632,900 410,266 565,322 Total equity 902,932 676,233 834,249 Provisions 1,214 228 916 Long-term liabilities – – – Current liabilities 568,124 598,521 871,293 Total equity and liabilities 1,472,270 1,274,982 1,706,458 ===== SIDA 18 ===== Sectra’s three-month interim report 2023/2024 18 (28) NOTES Note 1 Accounting policies This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting, the Swedish Annual Accounts Act and the Swedish Securities Markets Act. The accounting policies and calculation methods applied ar e consistent with those described in Sectra’s 2022/2023 Annual and Sustainability Report. Note 2 Related-party transactions Other than the types of transactions presented in Note 3 Employees and personnel costs in the 2022/2023 Annual Report, no significant transactions with related parties took place in the reporting period. Note 3 Number of shares No. of common shares 2 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Before dilution at the end of the period 192,667,489 192,662,325 192,667,489 192,667,489 After dilution at the end of the period 1 192,667,489 192,667,455 192,667,489 192,667,489 Average, before dilution 192,667,489 192,662,325 192,665,337 192,664,046 Average, after dilution 1 192,667,489 192,667,455 192,667,475 192,667,466 1 Dilution of the number of shares, based on the convertible programs issued in 2017/2018. Dilution corresponded to 5,130 share s on July 31, 2022 and the last remaining convertibles were redeemed on January 31, 2023. There are therefore no convertible programs outstanding. 2 Number of shares does not include the 1,453,406 (1,000,000) Class B treasury shares. Note 4 Operating segments and sales Operating profit/loss by business segment SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Imaging IT Solutions 74.3 80.4 456.3 462.4 Secure Communications 2.6 -6.5 28.2 19.2 Business Innovation -1.0 -1.8 11.3 10.5 Other Operations -6.5 -7.8 -35.0 -36.2 Group eliminations -0.1 0.1 -0.2 -0.2 Total 69.3 64.4 460.6 455.7 SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 United States 149.6 152.6 684.0 687.0 Sweden 104.9 97.6 480.2 472.9 United Kingdom 118.6 67.8 432.5 381.7 Netherlands 38.7 35.5 139.0 135.8 Rest of Europe 121.5 93.7 518.3 490.5 Rest of World 50.4 36.9 196.4 182.9 Total 583.7 484.1 2,450.4 2,350.8 Sales by business segment SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Imaging IT Solutions 518.6 435.8 2,161.8 2,079.0 Secure Communications 56.3 41.6 249.2 234.5 Business Innovation 16.7 12.7 77.8 73.8 Other Operations 34.6 26.6 132.7 124.7 Group eliminations -42.5 -32.6 -171.1 -161.2 Total 583.7 484.1 2,450.4 2,350.8 Sales by geographic market ===== SIDA 19 ===== Sectra’s three-month interim report 2023/2024 19 (28) Recurring and non-recurring external revenue by business segment Group SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue 397.2 310.4 1,446.6 1,359.9 Of which cloud recurring revenue, CRR 86.4 50.0 291.0 254.6 Non-recurring revenue 186.5 173.7 1,003.8 990.9 Total 583.7 484.1 2,450.4 2,350.8 Share of recurring revenue, % 68.0 64.1 59.0 57.8 Imaging IT Solutions SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue 370.7 288.1 1,340.6 1,258.1 Of which cloud recurring revenue, CRR 83.0 47.2 277.0 241.2 Non-recurring revenue 148.3 148.1 819.5 819.2 Total 519.0 436.2 2,160.1 2,077.3 Share of recurring revenue, % 71.4 66.1 62.1 60.6 Secure Communications SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue 22.8 19.2 90.1 86.5 Of which cloud recurring revenue, CRR 0.0 0.0 0.0 0.0 Non-recurring revenue 33.5 22.3 158.8 147.7 Total 56.3 41.5 248.9 234.2 Share of recurring revenue, % 40.5 46.3 36.2 36.9 Business Innovation SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue 3.7 2.9 15.5 14.7 Of which cloud recurring revenue, CRR 3.4 2.7 14.0 13.4 Non-recurring revenue 4.8 3.3 25.5 24.0 Total 8.5 6.2 41.0 38.7 Share of recurring revenue, % 43.5 46.8 37.8 38.0 Other Operations SEK million 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue 0.0 0.1 0.4 0.5 Of which cloud recurring revenue, CRR – – – – Non-recurring revenue – – – – Total 0.0 0.1 0.4 0.5 Share of recurring revenue, % 100.0 100.0 100.0 100.0 ===== SIDA 20 ===== Sectra’s three-month interim report 2023/2024 20 (28) Note 5 Financial definitions and alternative performance measures The Group applies the European Securities and Markets Authority (ESMA) Guidelines on Alternative Performance Measures (see below). Alternative performance measures are applied since the company believes they provide valuabl e supplementary information for management and investors given that they play a central role when it comes to understanding and evaluating th e Group’s operations. For future changes to Sectra’s recognition of order bookings, refer to page 71 in Sectra’s 2022/2023 Annual and Sustainability Report. Share of recurring revenue Purpose Shows the portion of external sales that is recurring. Recurring revenue refers to revenue from customers for the provision of a good or service during the term of a contract, wherein the customer cannot continue to benefit from the full functionality of the good or service without ongoing payments and the revenue stream is expected to recur for more than 12 months. Recurring revenue mainly refers to revenue from subscription, support and maintenance agreements. The share delivered via the cloud is reported as cloud recurring revenue (CRR). Revenue from system implementations, migration and one-time purchases of licenses are not recognized as recurring revenue. Calculation Recurring revenue divided by total external sales. Refer to the table on page 19. Recurring revenue churn SEK thousand 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Recurring revenue from customer contracts that have concluded or not been renewed 13,059 18,225 Recurring revenue 1,446,636 1,359,895 Share of recurring revenue, % 0.9 1.3 Purpose Calculation Indicates the share of recurring revenue from customer contracts that have concluded or not been renewed during the latest rolling 12-month period. Recurring revenue from customer contracts that have concluded or not been renewed divided by total recurring revenue. Equity per share before and after dilution Jul 31 2023 Jul 31 2022 Apr 30 2023 Equity, SEK thousand 1,386,349 1,145,988 1,296,669 Number of shares before dilution at the end of the period 192,667,489 192,662,325 192,667,489 Number of shares after dilution at the end of the period 192,667,489 192,667,455 192,667,489 Equity per share before and after dilution, SEK 7.20 5.95 6.73 Purpose Calculation Measures the company’s net value per share and shows if a company is increasing shareholder capital over time given currently available participations. Equity divided by the number of shares before and after dilution at the end of the period. ===== SIDA 21 ===== Sectra’s three-month interim report 2023/2024 21 (28) Non-interest-bearing liabilities and interest-bearing liabilities SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Non-interest-bearing liabilities 1,263,838 885,047 1,357,736 Interest-bearing liabilities 78,000 58,050 82,262 Total liabilities 1,341,838 943,097 1,439,998 Purpose Calculation Indicates the proportion of the Company’s liabilities with and without interest. Included in the calculation of the debt/equity ratio and capital employed. Non-interest-bearing liabilities refers to liabilities without interest, such as accounts payable, advances from customers and tax liabilities. Interest- bearing liabilities refers to liabilities with interest, such as lease liabilities. Cash flow per share before and after dilution 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Cash flow from operations, SEK thousand -98,298 -64,131 406,319 440,488 Number of shares before dilution at the end of the period 192,667,489 192,662,325 192,667,489 192,667,489 Number of shares after dilution at the end of the period 192,667,489 192,667,455 192,667,489 192,667,489 Cash flow per share before and after dilution, SEK -0.51 -0.33 2.11 2.29 Purpose Calculation Shows the cash flow the company generated per share before capital investments and financing. Cash flow from operations divided by the number of shares before and after dilution at the end of the period. Ratio of contracted order bookings to net sales SEK thousand 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Contracted order bookings 5,370,253 4,635,715 Net sales 2,450,402 2,350,752 Ratio of contracted order bookings to net sales 2.19 1.97 Purpose Calculation Provides an indication of demand for the company’s products and services. Contracted order bookings divided by net sales. Liquidity SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Current assets 2,184,430 1,600,145 2,208,381 Unutilized overdraft facilities 15,000 15,000 15,000 Current liabilities 1,269,923 895,476 1,364,641 Liquidity 1.7 1.8 1.6 Purpose Calculation Shows the company’s current ability to pay. Current assets plus unutilized overdraft facility divided by current liabilities. Average no. of employees Purpose Calculation Shows full-time positions in a certain period. Average number of full-time employees during the period. ===== SIDA 22 ===== Sectra’s three-month interim report 2023/2024 22 (28) Unadjusted exchange rates – sales 3 months May–Jul 2023 3 months May–Jul 2022 Full-year May–Apr 2022/2023 Nominal change, % 20.6 19.3 20.6 Exchange-rate effect, % -6.4 -8.6 -8.0 Change in unadjusted exchange rates, % 14.2 10.7 12.6 Purpose Calculation Provides an indication of changes in financial measures for unadjusted exchange rates. Amounts for the current year restated at last year’s average exchange rates less last year’s amounts at last year’s average exchange rates, divided by last year’s amounts at last year’s rates. Unadjusted exchange rates – operating profit 3 months May–Jul 2023 3 months May–Jul 2022 Full-year May–Apr 2022/2023 Nominal change, % 7.7 -28.6 18.9 Exchange-rate effect, % -13.0 -13.3 -16.3 Change in unadjusted exchange rates, % -5.3 -41.9 2.6 Purpose Calculation Provides an indication of changes in financial measures for unadjusted exchange rates. Amounts for the current year restated at last year’s average exchange rates less last year’s amounts at last year’s average exchange rates, divided by last year’s amounts at last year’s rates. Unadjusted exchange rates – recurring revenue 3 months May–Jul 2023 3 months May–Jul 2022 Full-year May–Apr 2022/2023 Nominal change, % 27.9 22.7 25.8 Exchange-rate effect, % -6.5 -7.6 -7.5 Change in unadjusted exchange rates, % 21.4 15.1 18.3 Purpose Calculation Provides an indication of changes in financial measures for unadjusted exchange rates. Amounts for the current year restated at last year’s average exchange rates less last year’s amounts at last year’s average exchange rates, divided by last year’s amounts at last year’s rates. Order bookings – guaranteed Purpose Calculation Indicates future revenue in the company. The share of contracted order bookings that corresponds to what the customer has undertaken to purchase when the contract is entered into. Order bookings – contracted Purpose Calculation Indicates future revenue in the company. The value of orders received that corresponds to what the customer has procured and intends to purchase during the term of the contract. ===== SIDA 23 ===== Sectra’s three-month interim report 2023/2024 23 (28) P/E ratio SEK 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Share price at end of period 168.6 161.7 Earnings per share for the rolling 12-month period 1.98 1.95 P/E ratio, multiple 85.2 82.9 Purpose Calculation Shows how the market values the company’s profits and how long it may take for the shareholders to get a return on an investment in the share. Share price at the end of the period divided by earnings per share for the most recent rolling 12-month period before dilution. Earnings per share before and after dilution 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit for the period, SEK thousand 61,556 54,128 382,384 374,957 Average no. of shares before dilution 192,667,489 192,662,325 192,665,337 192,664,046 Average no. of shares after dilution 192,667,489 192,667,455 192,667,475 192,667,466 Earnings per share before and after dilution, SEK 0.32 0.28 1.98 1.95 Purpose Calculation Shows each share’s participation in the company’s earnings during the reporting period. Profit/loss after tax divided by the average number of shares before dilution. This performance measure is defined in accordance with IFRS. Return on equity SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit for the period 61,556 54,128 382,384 374,957 Equity at start of period 1,296,669 1,080,737 1,145,988 1,080,737 Equity at end of period 1,386,349 1,145,988 1,386,349 1,296,669 Average equity 1,341,509 1,113,363 1,266,169 1,188,703 Return on equity, % 4.6 4.9 30.2 31.5 Purpose Calculation Shows the return on capital attributable to the Parent Company owners. Profit for the period divided by average equity. Return on capital employed (ROCE) SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit after financial items 77,526 68,172 488,744 479,390 Financial expenses -434 -313 -2,183 -2,062 Average capital employed 1,421,640 1,173,699 1,334,194 1,261,146 Return on capital employed, % 5.5 5.8 36.8 38.2 Purpose Calculation Shows profitability based on how much capital is used in the operations. Profit after financial items plus financial expenses divided by average capital employed. ===== SIDA 24 ===== Sectra’s three-month interim report 2023/2024 24 (28) Operating margin SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Operating profit 69,313 64,350 460,616 455,653 Net sales 583,739 484,089 2,450,402 2,350,752 Operating margin, % 11.9 13.3 18.8 19.4 Purpose Calculation Measures operational profitability. This measure is used for the purpose of management by objectives in the operations. Operating profit divided by net sales. Operating profit per share 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Operating profit, SEK thousand 460,616 455,653 Number of shares before dilution 192,667,489 192,667,489 Operating profit per share, SEK 2.39 2.36 Purpose Calculation Shows earnings per share before interest and taxes. Operating profit divided by the number of shares before dilution on the balance-sheet date. Debt/equity ratio SEK thousand Jul 31 2023 Jul 31 2022 Interest-bearing liabilities 78,000 58,050 Equity 1,386,349 1,145,988 Debt/equity ratio 0.06 0.05 Purpose Calculation Shows to what extent the operations are financed by loans and describes the company’s financial risk. Interest-bearing liabilities divided by equity. Equity/assets ratio SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Equity 1,386,349 1,145,988 1,296,669 Total assets 2,728,187 2,089,085 2,736,667 Equity/assets ratio, % 50.8 54.9 47.4 Purpose Calculation Shows the portion of assets financed with equity. This measure is used for the purpose of management by objectives in the operations. Equity divided by total assets on the balance-sheet date. Capital employed SEK thousand Jul 31 2023 Jul 31 2022 Apr 30 2023 Total assets 2,728,187 2,089,085 2,736,667 Non-interest-bearing liabilities 1,263,838 885,047 1,357,736 Capital employed 1,464,349 1,204,038 1,378,931 Purpose Calculation Shows the portion of the company’s assets that has been borrowed from, for example, the company’s owners or external lenders, and shows the company’s profitability in relation to externally financed capital and equity. Total assets reduced by non-interest-bearing liabilities. ===== SIDA 25 ===== Sectra’s three-month interim report 2023/2024 25 (28) Growth in operating profit per share over a five-year period SEK 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Operating profit per share before dilution 2.391 2.360 Operating profit per share before dilution five years earlier 1.120 1.125 Growth in operating profit per share before dilution over a five-year period, % 113.4 110.0 Purpose Calculation Shows the growth of the operations over a five-year period. This measure is used for the purpose of management by objectives in the operations. Operating profit per share on the balance-sheet date less operating profit per share on the balance-sheet date five years earlier divided by operating profit per share on the balance-sheet date five years earlier. Profit margin SEK thousand 3 months May–Jul 2023 3 months May–Jul 2022 12 months Aug 2022 –Jul 2023 Full-year May–Apr 2022/2023 Profit after financial items 77,526 68,172 488,744 479,390 Net sales 583,739 484,089 2,450,403 2,350,752 Operating margin, % 13.3 14.1 19.9 20.4 Purpose Calculation Shows a comparison of profitability regardless of corporate tax rate. Profit after financial items divided by net sales. KEY FIGURES AND OTHER INFORMATION Key figures 3 months Jul 31 2023 3 months Jul 31 2022 12 months Jul 31 2023 Full-year Apr 30 2023 Contracted order bookings, SEK million 2,970.0 2,235.4 5,370.3 4,635.7 of which guaranteed order bookings, SEK million 344.4 705.3 2,245.6 2,606.5 Operating margin, % 11.9 13.3 18.8 19.4 Profit margin, % 13.3 14.1 19.9 20.4 Average no. of employees 1,112 975 1,049 1,015 Cash flow per share, SEK 1, 2 -0.51 -0.33 2.11 2.29 P/E ratio, multiple n/a n/a 84.9 82.9 Share price at end of period, SEK 168.6 185.9 168.6 161.7 Return on equity, % 4.6 4.9 30.2 31.5 Return on capital employed, % 5.5 5.8 36.8 38.2 Equity/assets ratio, % 50.8 54.9 50.8 47.4 Liquidity ratio, multiple 1.7 1.8 1.7 1.6 Equity per share, SEK 2 7.20 5.95 7.20 6.73 1 Cash flow from operations. 2 Before and after dilution. ===== SIDA 26 ===== Sectra’s three-month interim report 2023/2024 26 (28) Condensed consolidated income statements by quarter SEK million 2023/2024 2022/2023 2021/2022 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net sales 583.7 724.7 580.3 561.7 484.1 649.0 476.2 418.2 405.7 Capitalized work for own use 18.0 20.6 14.7 11.5 9.0 10.6 8.7 13.3 11.6 Other operating income 1.3 0.5 0.5 0.4 0.1 0.4 0.0 0.6 0.3 Operating expenses -509.2 -524.7 -485.2 -443.9 -406.6 -497.1 -395.2 -329.4 -308.4 Depreciation/amortization and impairment -24.5 -24.3 -23.3 -22.1 -22.2 -21.8 -21.3 -19.0 -19.1 Operating profit 69.3 196.8 87.0 107.6 64.4 141.1 68.4 83.7 90.1 Total financial items 8.2 5.1 4.1 10.7 3.8 0.3 8.6 0.2 2.0 Profit after financial items 77.5 201.9 91.1 118.3 68.2 141.4 77.0 83.9 92.1 Tax on earnings for the period -16.0 -47.3 -18.8 -24.4 -14.0 -29.0 -14.1 -17.6 -19.0 Profit for the period 61.6 154.6 72.3 93.9 54.1 112.5 62.9 66.3 73.1 Key figures by quarter 2023/2024 2022/2023 2021/2022 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Contracted order bookings, SEK million 2,970.0 1,186.9 549.2 664.2 2,235.4 1,017.4 439.6 470.0 393.2 of which guaranteed order bookings, SEK million 344.4 811.6 484.0 605.6 705.3 1,017.4 439.6 470.0 393.2 Recurring revenue 397.2 376.6 356.4 316.4 310.4 280.8 275.2 272.4 253.0 of which cloud recurring revenue (CRR) 86.4 72.9 72.1 59.6 50.0 50.5 46.4 42.6 41.9 Operating margin, % 11.9 27.2 15.0 19.2 13.3 21.7 14.4 20.0 22.2 Earnings per share, SEK 1, 2 0.32 0.80 0.38 0.49 0.28 0.58 0.33 0.34 0.38 Cash flow per share, SEK 1, 2 -0.51 1.98 0.43 0.20 -0.33 2.15 0.79 0.21 0.05 Return on equity, % 4.6 12.7 6.5 8.5 4.9 11.0 6.3 6.6 7.8 Return on capital employed, % 5.5 15.6 7.8 10.2 5.8 13.1 7.3 7.8 9.2 Equity/assets ratio, % 50.8 47.4 50.4 52.3 54.9 49.3 52.5 61.3 59.6 Equity per share, SEK 1, 2 7.20 6.73 5.94 5.54 5.95 5.61 4.98 5.38 5.06 Share price at end of period, SEK 2 168.6 161.7 147.44 146.40 185.90 124.80 152.50 209.60 137.20 1 Before and after dilution. 2 Comparative figures per share have been restated due to the 5:1 share split that Sectra carried out in the second quarter of 21/22. Five-year summary 2022/2023 2021/2022 2020/2021 2019/2020 2018/2019 Contracted order bookings, SEK million 4,635.7 2,320.2 2,651.6 1,816.0 2,132.8 Net sales, SEK million 2,350.8 1,949.1 1,632.4 1,661.1 1,413.5 Operating profit, SEK million 455.7 383.4 350.1 295.3 235.5 Profit after financial items, SEK million 479.4 394.5 348.2 303.0 248.8 Profit for the period, SEK million 375.0 314.8 275.5 237.4 199.0 Operating margin, % 19.4 19.7 21.4 17.8 16.7 Profit margin, % 20.4 20.2 21.3 18.2 17.6 Earnings per share before dilution, SEK 1 1.95 1.63 1.43 1.24 1.04 Earnings per share after dilution, SEK 1 1.95 1.63 1.43 1.23 1.03 Redemption program per share/dividend, SEK 1 2 1.10 1.00 0.90 0.90 0.90 Share price at end of year, SEK 2 161.70 124.80 121.00 84.00 64.40 P/E ratio, multiple 82.9 76.6 84.6 68.0 61.8 Return on equity, % 31.5 31.9 32.2 30.7 29.8 Return on capital employed, % 38.2 37.5 37.4 36.8 35.9 Equity per share before dilution, SEK 1 6.73 5.61 4.65 4.24 3.80 Equity per share after dilution, SEK 1 6.73 5.61 4.65 4.24 3.78 Equity/assets ratio, % 47.4 49.3 54.2 54.1 55.4 1 Comparative figures per share have been restated due to the 5:1 share split that Sectra carried out in the second quarter of 21/22. 2 2022/2023 refers to the share redemption program proposed by the Board of Directors. ===== SIDA 27 ===== Sectra’s three-month interim report 2023/2024 27 (28) Exchange rates Currency Average rates in SEK Closing rates in SEK 3 months May–Jul 2023 3 months May–Jul 2022 Δ % Jul 31 2023 Jul 31 2022 Δ % US dollar, 1 USD 10.67 10.00 6.7 10.46 10.08 3.8 Euro, 1 EUR 11.62 10.47 11.0 11.53 10.32 11.7 British pound, 1 GBP 13.52 12.32 9.7 13.47 12.32 9.3 GLOSSARY Genomics The study of genetic material, meaning an organism’s DNA. In medicine, a patient’s genetic material is studied to increase understanding of the causes of disease. In cancer diseases, for example, a tumor’s mutations are studied in DNA. The genetic information plays an important role in diagnosing cancer and customizing treatment, known as precision medicine. Cardiology/cardiovascular diseases The field of medicine dealing with the functions and diseases of the heart. Critical infrastructure Basic infrastructure that is essential for the functioning of society, such as roads, bridges and electricity and water supply. Encryption Equipment that uses mathematical manipulations (algorithms and keys) to encrypt information, so that it can be interpreted or read only by the intended recipient. To read encrypted information, the recipient must have the correct key and algorithm. The cloud/cloud solutions From the term cloud computing, meaning delivering services and sharing IT infrastructure over the internet. Ophthalmology A specialist medical area for the diagnosis and treatment of eye disorders. Orthopaedics A surgical specialty for disorders affecting the musculoskeletal system. Pathology/histopathology/microscopy A specialized medical area that uses tissues and body fluids for diagnostic purposes. Precision medicine Providing patient care that is highly adapted to individual conditions. Advanced diagnostic analyses are a cornerstone of precision medicine. Radiology A health science discipline and medical specialty that uses technologies for imaging the human body, such as X-ray, magnetic resonance imaging (MRI) and ultrasound. Sectra One/Sectra One Cloud A subscription for Sectra’s enterprise imaging solution. Under the new model, customers pay a more evenly distributed subscription fee every year instead of paying a higher license fee for software at the start of the contract and a lower rolling service fee. The fee is determined based on the functionality used and the number of different services utilized. When Sectra One is sold as fully cloud-based services, it is referred to as Sectra One Cloud. High assurance/High assurance products Cryptographic methods and other measures designed to prevent unauthorized parties from accessing or influencing information in telecom and IT systems. The high assurance products that Sectra provides are approved by one or more nations and, for certain products, by the EU and NATO. ===== SIDA 28 ===== Sectra’s three-month interim report 2023/2024 28 (28) ABOUT SECTRA Vision To contribute to a healthier and safer society. Mission statements To increase the effectiveness of healthcare, while maintaining or increasing the quality of care. To strengthen the stability and efficiency of society’s most important functions through solutions for critical IT security. Operating areas/business models Imaging IT Solutions helps hospitals across the world to become more efficient, enabling them to care for more patients and save more lives. Increased use of medical images and aging populations that are living longer pose huge challenges to healthcare. Sectra’s IT solutions and services for medical diagnostic imaging enable greater efficiency and cont ribute to healthcare advancements. Sectra has exceeded 2,000 installations of medical IT systems, and customers include some of the largest healthcare providers in the world. Secure Communications helps society's critical functions, government officials and diplomats to use modern technology to exchange information securely, thereby contributing to a stable and secure society. Sectra’s solutions and services increase cybersecurity by protecting some of society’s most sensitive information and communications. Several of the business area’s products are approved by the EU, NATO, and national security authorities. Business Innovation gathers smaller activities that could eventually lead to major growth in Sectra’s main areas or related niches. Group-wide strategies for value creation and sustainable business development Customer value is the top priority Customers and customer satisfaction are always assigned top priority to enable long -term growth. Close relationships with demanding customers ensure that Sectra’s solutions meet market demands for quality, functionality and usability. A motivating corporate culture A corporate culture that motivates and inspires the company’s employees to solve customer problems and constantly drive improvement. All so we can meet—and in many cases exceed—customer expectations. Constant innovation Close cooperation with customers, universities an d industrial partners in order to identify needs and ideas, combined with a corporate culture where management encourages the employees to test out new ideas and projects. Geographic expansion International expansion mainly in areas and regions where Sectr a holds an established position. This expansion will primarily be achieved through organic growth, in certain cases supplemented by acquisitions that strengthen the Group’s organic growth. For more information, visit https://investor.sectra.com 7 good reasons to invest in Sectra International niche markets with strong growth IT for healthcare and cybersecurity for critical social functions are rapidly changing markets that society needs to invest in. This creates major growth opportunities for companies such as Sectra. Stability, profitability and long-term growth Sectra has an over 45 -year history of growth and profitability. Over 50% of the company’s sales comprise recurring revenue from long-term customer contracts. Customer-focused corporate culture A strong corporate culture clearly focused on customer value and employees who are passionate about making a difference lead to satisfied customers. To safeguard our corporate culture, growth is primarily organic. Strong brand with multinational reach Sectra is an established brand in niche areas where trust and stable products are highly important success factor s. We have a multinational reach, with thousands of customers worldwide. Innovation By continuously investing in new and enhanced products and services, as well as how they are packaged and delivered, we create value for our customers. We also have a sel f-financed portfolio of research and business projects with the potential to add significant value in the future. Sustainable business model Contributing to healthier and safer societies is the foundation of Sectra’s operations and business model. Helping our customers improve the efficiency and quality of patient care and increase cybersecurity in critical social functions is our most significant contribution to a sustainable society. Long-standing owners and dedicated management The principal owners, who have been part of the company since the 1980s, have firm dedication to the long-term development of the company, and all members of Group Management are shareholders.