Presentation Q4 2003

1
Year End Report 2003 Industrivärden, February
18, 2004
2
Industrivärden investment case

• Value investor with a focus on investments in
  listed Nordic shares
• Proven track record - excess returns under a
  long period of time
• Portfolio of Swedish blue-chip companies
• Conservative gearing provides opportunity for
  increased leverage when opportunities occur
• Very low administrative expenses, USD 10 M or
  less than 0,3 of AUM
• Investment company tax status no tax on
  capital gains, dividends
  received/rendered are taxable/deductible
• Experienced management team with proven track
  record
• Discount to NAV appr. 21, historical average 28

3
Industrivärden in brief

• Number of shares 193 million shares
• Market cap Appr. USD 3.4 bn (SEK 25 bn)
• Free float Appr. 60 of shares
• No of shareholders 35.000
• Average daily turnover Appr. 180.000 shares
• Volatility 30 (60 days)
• Coverage Carnegie, Johan Sjöberg, 46 8 676 88
  00
• ABG Sundal Collier, Fredrik Grevelius, 46 8
  566 286 95
• Enskilda Securities, Andreas Joelsson, 46 8
  52 2295 00
• Chairman Tom Hedelius
• CEO Anders Nyrén
• CFO Carl-Olof By

4
Mission, goal and vision
Business mission Create shareholder value based
on a professional investment operation and active
ownership
Our goal Generate high growth in net asset value
over time ? Industrivärdens stock will give
shareholders a high total return
Vision To be perceived as the leading investment
company with a focus on large and medium-sized
listed Nordic companies
5
Two dimensional strategy
Generate high growth in net asset value over time
Professional investment operation
Active ownership
6
Our investment criteria
Conditions
Portfolio
Scope Concentrated portfolio
Sectors Sector generalist Ownership Possibility
to be major or structure largest
owner Investment horizon 3-8 years Geography N
ordic companies Requirement Major potential for
value creation
Individual investments
Market value Large and medium- sized
companies Type Mainly listed Exit Appropriate
exit once target value has been created
Expansion phase
Management phase
Restructuring phase
Startup phase
Private equity investor in mature companies
Venture capitalists
Industrivärden
7
Ownership structure
No. shares
of shares votes
Number of shareholders 35 000
December 31, 2003
8
Long-term excess returns
The average annual excess return was 5 / year
for the last five years 2 / year for the last
ten years
Total return index (Index)
(c) SIX AB 2004
645
Industrivärden Stock
500
400
300
Total Return Index (SIXRX)
200
100
81.5
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
9
Positive development of net asset value in 2003
SEK bn
SEK/share 280 222
204 153 126
133 156 170
Net debt
Stock portfolio
10
2003 in brief

• Net asset value on December 31, 2003
• ? SEK 30,070 M (24,415), an increase of SEK
  5,655 M in 2003
• ? SEK 156 (126), an increase, reinvested
  dividends included, of SEK 37 per
  share in 2003
• Munters new active holding after purchase of 11
  of the total stock for SEK 490 M
• Purchase of stocks in SCA, Handelsbanken,
  Munters and SSAB for a total of SEK
• 1,756 M. In the end of 2003 the entire holding
  in Skandia was sold for SEK 1,253 M
• Stocks were purchased for a total of SEK 2,012 M
  and sold for SEK 1,933 M
• Derivative transactions conducted within the
  framework of Industrivärdens
• structured market presence generated a profit
  of approx. SEK 100 M
• The Board of Directors proposes a dividend of
  SEK 5.50 (5.80) per share

11
Development of dividend
Dividend yield
SSEX dividend yield
Dividend 4.50 6.20 8.40 8.35 5.80 5.50 SEK/share
12
Dividend policy and tax rules
Industrivärden's dividend policy is to pay a
higher long-term dividend yield than the average
for the Stockholm Stock Exchange
Taxable
Deductible

• Dividends received
• Interest income
• Standard tax rate, 1.5 of the
• stock portfolios market value
• at the beginning of the year

• Dividends distributed
• Interest expenses
• Administrative costs

Tax exempt
Not deductible

• Capital gains on sales of stocks

• Capital losses on sales of stocks

? The dividend paid out can be adjusted to avoid
tax
As from 2004 the standard tax rate will only be
charged on listed holdings representing less
than 10 of the votes.
13
Major activities during the last 24 months
INVESTMENTS
SALES
ACTIVE OWNERSHIP
Identified value potential
Value creation
Realization of values/ adaption of strategy

• Subscription in Ericssons new issue
• 16 of the orthopedics comp. Ossur
• 11 of the moisture ctrl. comp. Munters
• Increase of ownership in SCA, SHB
• SSAB
• Others

Development of new work methods and
models ?Strong ability moving forward

• Lundbeck
• Besam
• Skandia
• Others

Price SEK 4.1 bn
Price SEK 8.3 bn Cap. gain SEK 2.4 bn

• Structured asset management

Result from derivative transactions 2003 SEK
101 M
December 2001-December 2003
14
Transactions during the last 24 months
SEK M
December 2001-December 2003
15
Latest active holdings

• Orthopedics company, leader in prosthetic legs
• Distinct customer need and fast growth
• Very good position in Nordic region, strong
  position in the U.S.
• Robust expansion in Europe
• Market cap SEK 1.4 bn, turnover SEK 769 M,
  earnings a. taxes SEK 38 M
• 2003 Higher RD outlays for the companys new
  range of orthotic products, restructuring and
  patent protection litigation costs in North
  America

16 of shares

• Global quality company in humidity control, high
  degree of service
• Three product areas Dehumidification, Moisture
  Control Services, and Evaporative cooling
• Long-term good growth
• 2003 Cost-cutting programs SEK 120 M on a
  full-year basis have been
• initiated during the year

11 of shares
Earnings and turnover 2003.
16
Strong financial position
Interest-bearing net debt (SEK billion)
Net debt-equity ratio
Parent companys interest-bearing net debt,
adjusted for liabilities to internal companies,
in relation to the market value of the parent
company's stock portfolio.
17
Composition of net asset value
SEK per share
SEK billion
Dec. 31 2002 136 -10 126
Feb. 16 2004 36.1 -3.2 32.9
Feb. 16 2004 186 -16 170
Dec. 31 2003 32.9 -2.8 30.1
Dec. 31 2003 170 -14 156
Dec. 31 2002 26.4 -2.0 24.4
Equities portfolio Net debt Net asset value
18
Development of net asset value
Share of net asset value,
Other
Dec Dec Dec Dec Dec Feb 99 00
01 02 03 04
19
Equities portfolio as per December 31, 2003
Health care (2)
Other (2)
Trading (5)
Construction (7)
Sandvik SSAB Munters Isaberg Rapid others
Ossur oth.
Engineering (26)
Indutrade
Skanska
Telecom (15)
Ericsson
Handelsbanken
SCA
Forestry and consumer products (19)
Banking (24)
As per December 31, 2003
20
Equities portfolio as per December 31, 2003
21
Equities portfolio as per February 16, 2004
Ossur (lt1)
Other (7)
Isaberg Rapid (1)
Munters (1)
Ericsson (22)
SSAB (5)
Indutrade (5)
Skanska (6)
Sandvik (14)
Handelsbanken (21)
SCA (17)
22
Equities portfolio as per December 31, 2003 and
February 16, 2004
Dec. 31, 2003
February 16, 2004
Average annual total return,
Market- value, SEK M
5 yrs., Dec. 98-Dec. 03
10 yrs., Dec. 93-Dec. 03
Market- value, SEK M
Stock
No. shares
No. shares
23
Well developed internal methods and systems

• Good up-to-date knowledge about interesting
  companies
• Ability to act quickly when business
  opportunities arise
• Structured investment process
• Flexible organization at low cost

? Efficiency and quality
24
Work process at a glance
Exit evaluation
Active ownership
New investments
Structured market presence
Organization Methods Systems Networks
25
Major knowledge about possible investments
Listed companies in the Nordic region approx.
900 Total market cap SEK 5,4 billion (December
03)
Ability for quick entries
Continuous scanning of all companies
Structured monitoring of all interesting
companies
Continuous analysis of selected companies that
meet investment criteria. Documentation in
database
Interesting companies
Companies to evaluate (Approx. 150 comp.)
Investments
26
Value creation

• Value potential
• Business model, growth, profitability, other
  value-creating measures
•  
• Market potential
• Organic growth for the market and company.
  Entrance obstructions. Acquisition opportunities
•  
• Strategic positioning
• Strategy, acquisitions or divestments
•  
• Capital rationalization
• Dividend, capital reduction, stock buybacks,
  refinancing, working capital
•  
• Operational improvements
• Cost-cutting, market position, etc.
• Board and management
• Competence and capacity

27
Good growth over time
Annual excess return (change in value, dividends
incl.) for the Industrivärden shares compared
with Total return index (SIXRX)
10 yrs
2 pts annually in
7 yrs
4 pts annually in
5 yrs
5 pts annually in
2003/10/29
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
Average annual total return for the respective
periods through 03/12/31
28
Industrivärden online
?
? Reuterskod INDUa.ST Bloombergskod INDUA
SS Datastream kod W IU ? www.industrivarden.net
? info_at_industrivarden.se ? 46-8-666 64 00 ?
46-8-661 46 28 ? Box 5403, SE-114 84
Stockholm, Sweden
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