Beijer Ref AB

Q4 2014
Strong end to the year

Quarter 4 2014

Net sales amounted to SEK 1,789.7M (1,589.2).

Operating profit amounted to SEK 115.5M (98.9).

Net profit amounted to SEK 82.5M (61.1).

Profit per share amounted to SEK 1.91 (1.38).

Sales growth of 12.6 per cent and operating profit improvement of 16.7 per cent
compared with the corresponding quarter in the previous year. Organic growth in
sales of 4.8 per cent and organic increase in operating profit of 13.0 per cent.

New acquisition, GFOI on the Réunion Island in the southern hemisphere.

The Board of Directors proposes a dividend of SEK 5.00 (4.75) per share.

Comments by the CEO

Strong growth in several markets

With increased sales of 13 per cent, of which an organic growth of five per cent
and an operating profit of SEK 115.5M, the fourth quarter showed the strongest
rate of increase during 2014, both organically and totally – a convincing end to
the year characterised by a number of strategically important decisions and
events such as the EU’s resolution about a new f-gas ordinance.

          In some of the Group’s geographic segments, the increase was
considerable. In the Nordic countries, sales increased by 23 per cent, in
Central Europe by 10 per cent and in A&A (Africa and Asia), Thailand achieved
six per cent and South Africa 18 per cent.

          The Nordic countries lead the development with regard to the
changeover from f-gases to environment-friendly refrigerants.

This favours Beijer Ref which has a strong position in the sector. The United
Kingdom continues to convince with its extensive

domestic service concept. In the largest market in Europe, Germany, the
operation established from scratch by Beijer Ref a few years ago has gained a
solid foothold.

          However, the individually largest market region, Southern Europe, has
continuing difficulties in achieving the levels that

prevailed prior to the conflict between Russia and Ukraine and the European
financial crisis. The five countries, South Africa, Namibia, Botswana,
Mozambique and Zambia showed that Africa with its considerable requirement for
modern refrigeration systems remains a highly interesting market for Beijer Ref
with 10 per cent organic growth in the fourth quarter.

New acquisition in the southern hemisphere

In October, Beijer Ref acquired all the shares in the French refrigeration
wholesaler GFOI (Générale Frigorifique Océan Indien),

which is based on the Réunion Island and located approximately 800 kilometres
east of Madagascar in the Indian Ocean. GFOI reports sales of approximately SEK
50M and is the leading refrigeration wholesaler on Réunion, which is a French
département with more than 840,000 inhabitants and a rapidly expanding tourist
industry. GFOI will be integrated into Beijer Ref and will serve as a branch of
the Group’s French refrigeration wholesaler, GFF. With the acquisition, Beijer
Ref reaches sales of more than SEK 700M in the southern hemisphere.

Own manufacturing restructured

Since the acquisition of the remaining 49 per cent of the shares in SCM Frigo in
July 2014, the Group’s newly-established Beijer Ref OEM business area, under the
management of the Italian company, has increased its venture into own production
of both standardised and customer-adapted environment-friendly refrigeration
systems as well as the training of customers and suppliers in environment
-friendly refrigeration technology under the name, Beijer Ref Academy. The first
company in addition to SCM Frigo to adapt the new

manufacturing concept was DEM in Vislanda, under the name SCMREF AB. During
2015, Beijer Ref’s own operation will be made more efficient under the
management of its Italian production company.

Carrier DX ready for launch during the first quarter of 2015

During the fourth quarter, the work of relaunching Carrier’s technically updated
DX products (comfort cooling) has been completed. We are now ready to start up
sales and distribution of Carrier’s heat-pump and air-conditioning programme in
most European countries on an exclusive basis.

2015

The weaker SEK has favoured us as more than 95 per cent of invoicing is made in
foreign currency. Current exchange rates will most probably signify further
positive exchange effects, at least during the first quarter of the year.

          The EU’s resolution about a new f-gas ordinance involves the phasing
out of old refrigerants which means that a comprehensive adaptation of the
refrigeration sector is likely. New environment-friendly refrigerants – either
natural, such as carbon dioxide, or

synthetic, will replace the current HFC-based technology. Beijer Ref stands well
equipped for this change-over with its long experience within carbon dioxide
-based solutions.

          In line with the company’s dividend policy, the Beijer Ref Board of
Directors proposes an increased dividend of SEK 5.00 (4.75).

Per Bertland

CEO, Beijer Ref AB

About Beijer Ref

Beijer Ref is one of the largest refrigeration wholesalers in the world and the
leading company in Europe. The Group offers competitive and innovative solutions
within refrigeration and air conditioning providing customer-adapted products,
environment-friendly and energy-efficient chillers developed by the company
itself and an efficient service.

Sales

Beijer Ref increased its sales by 12.6 per cent to SEK 1,789.7M (1,589.2) for
the fourth quarter of 2014. Adjusted for exchange rate fluctuations and
acquisitions, the organic change in sales was 4.8 per cent. Accumulated for
twelve months, the organic growth amounts to 3.1 per cent. For the 2014 full
year, the Group’s turnover amounted to SEK 7,189.0M (6,595.4).

Beijer Ref operates in three market areas: commercial refrigeration, industrial
refrigeration and HVAC (comfort cooling). The Group splits its operation in the
global market into five geographic segments: The Nordic countries, Central
Europe, Eastern Europe, Southern Europe and A&A (Africa and Asia).

Behind the quarter’s sales increase lies a positive development in Central
Europe, the Nordic countries and A&A whereas the southern and east European
markets report a weak demand.

Results

The Group’s operating profit amounted to SEK 115.5M (98.9) for the fourth
quarter. The result increase can mainly be explained by increased sales,
especially in the Nordic countries, Central Europe and A&A. When adjusted for
exchange rate fluctuations and acquisitions, the organic increase in operating
profit was 13 per cent.

In the previous year’s figures, the accumulated operating result is charged with
one-time costs of SEK 34.2M. For the 2014 full year, the operating profit
amounted to SEK 481.4M (377.7). Excluding one-time costs, the operating profit
was SEK 411.9M in the previous year. The organic increase for the 2014 full year
was 23.0 per cent.

The Group’s financial income/expense amounted to SEK -8.3M (-7.4) for the fourth
quarter. Profit before tax was SEK 107.2M (91.5). Profit after tax was SEK 82.5M
(61.1). Profit per share amounted to SEK 1.91 (1.38). For the 2014 full year,
the Group’s financial income/expense amounted to SEK -34.9M (-31.1). Profit
before tax was SEK 446.5M (346.6). Profit after tax amounted to SEK 324.5M
(244.2). Profit per share was SEK 7.46 (5.51).

Dividend

The Board of Directors proposes that the Annual Meeting of shareholders resolves
that a dividend of SEK 5.00 (4.75) per share shall be paid for the 2014
financial year. This is equivalent to a total of SEK 212.0M if the shares
currently held by the company are excluded.

Other financial information

Consolidated capital expenditure, including acquisitions, amounted to SEK 182.6M
(57.6) for the 2014 full year. Of this, the major portion refers to the
acquisition of the remaining 49 per cent in SCM Frigo. Liquid funds, including
unutilised bank overdraft facilities, were SEK 503.8M (563.2) on 31 December
2014. Shareholders’ equity amounted to SEK 2,618.6M (2,417.0). The net debt was
SEK 1,429.8M (1,211.5). The equity ratio amounted to 46.0 per cent (47.3). The
average number of employees during the period was 2,207 (2,137).

Significant events during the year

In January, Beijer Ref acquired all the shares in Eurocool (Pty) Ltd, a leading
refrigeration wholesaler in South Africa. Eurocool was founded in 1999 and
currently holds a strong market position within Beijer Ref’s priority segments.
The company reports sales of approximately SEK 65M and has 36 employees. The
acquisition is estimated to provide cost synergies, increased efficiency and
increased purchasing volumes through the co-ordination with Beijer Ref’s
existing operation in southern Africa. The acquisition is deemed to have a
marginal positive effect on Beijer Ref’s profit per share in 2014. Eurocool is
included in Beijer Ref’s accounts from January 2014.

On 12 March, the EU Parliament voted ‘yes’ to the proposal about a new f-gas
ordinance which was confirmed by the Council of Ministers in a vote on 14 April.
As a result, the decision to phase out refrigerants with fluorised greenhouse
gases (f-gases) has come into force which is predicted to have a positive effect
on Beijer Ref through the investments in new technology which the end customers
will gradually need to make and where Beijer Ref is well prepared for the new
rules and regulations.

On 14 May, the Swedish Companies Registration Office approved the Group’s change
of name from G & L Beijer to Beijer Ref. A classic Swedish industrial company’s
modern operation is now also reflected in the company name.

In July, Beijer Ref acquired the remaining 49 per cent of the shares in the
Italian SCM Frigo Group, a leading manufacturer in Europe of, among other
things, chillers based on environment-friendly technology. The company reports
sales of around SEK 240M and has 90 employees. The acquisition is deemed to have
a positive effect on Beijer Ref’s net income already in 2014.

In August, Beijer Ref acquired all the shares in a leading refrigeration
wholesaler in Norway, Børresen Cooltech AS. Børresen Cooltech reports sales of
SEK 60M, has 20 employees and will be integrated into Beijer Ref’s organisation.
The acquisition is deemed to have a marginally positive effect on Beijer Ref’s
net income. Børresen Cooltech is included in the consolidated accounts from
August 2014.

In September, Beijer Ref strengthened its position in the rapidly growing German
refrigeration wholesale market when it acquired the net assets in Grün
Großhandel für Kälte- und Klima­zubehör. The company reports sales of
approximately SEK 25M, has seven employees and gives the Group a strategically
important presence in Stuttgart. The acquisition is deemed to have a marginally
positive effect on Beijer Ref’s net income. The company is included in the
consolidated accounts from October 2014.

In October, Beijer Ref acquired all the shares in the French refrigeration
wholesaler, GFOI (Générale Frigorifique Océan Indien). GFOI is located on the
Réunion Island approximately 800 kilometres east of Madagascar in the Indian
Ocean. The company reports sales of around SEK 50M, has seven employees and is a
step in the Group’s expansion outside Europe. The acquisition is deemed to have
a marginally positive effect on Beijer Ref’s net income.

Events after the end of the reporting period

In January 2015, Beijer Ref signed a new exclusive distribution agreement with
Carrier the world-leading American refrigeration group. The agreement gives
Beijer Ref the exclusive right to sales and service of the DX comfort cooling
products in Europe. Beijer Ref already has the sole right for the distribution
of Toshiba’s air-conditioning units, heat pumps and ventilation systems, and the
agreement with Carrier further strengthens the Group’s product supply.

Risk assessment

The operations of the Beijer Ref Group are affected by a number of external
factors, the effects of which on the Group’s operating profit can be controlled
to a varying degree. The Group’s operation is dependent on the general economic
trend, especially in Europe, which controls the demand for Beijer Ref’s products
and services. Acquisitions are normally linked with risks such as, for example,
staff defection. Other operating risks, such as agency and supplier agreements,
product responsibility and delivery undertaking, technical development,
warranties, dependence on individuals, etc., are continually being analysed and,
when necessary, action is taken to reduce the Group’s risk exposure. In its
operation, Beijer Ref is exposed to financial risks such as currency risk,
interest risk and liquidity risk. The parent company’s risk picture is the same
as that of the Group. For further information see the Group’s Annual Report.

Financial information

- The Annual Report for 2014 will be published in March 2015.

- The Three-Month Report for 2015 will be published on 23 April 2015.

Malmö, 10 February 2015

Beijer Ref AB (publ)

Board of Directors

For further information, please contact:

Per Bertland, CEO

switchboard +46 40-35 89 00, mobile +46 705-98 13 73

Jonas Lindqvist, CFO

switchboard +46 40-35 89 00, mobile +46 705-90 89 04

This interim report has not been the subject of an examination by the company’s
auditors.

www.beijerref.com