Follow-up Structure BS & CF KA/Group Business Control

Document Information Title: Follow-up Structure BS & CF Description: Responsible: KA/Robert Burning Valid as of: 1 September 2010 Reviewed: 1 September 2012

Transparent Follow-up Structure

Net Working Capital and Cash Flow Follow-up Definiton of working capital in balance sheet and cash flow The volume-based change in working capital should match the change of working capital in the cash flow Follow up monthly and quarterly Group Working Capital Long term receivables should be excluded from working capital Interest bearing liabilities should be excluded from working capital Structural adjustment of acquired working capital should be calculated on an average rate when calculating volume change Business Areas Balance Sheet Interest bearing liabilities excluded Pre paid notes are included into working capital as accounts receivables Short term financial leasing receivables are added in working capital as others Long term noninterest-bearing liabilities to associated companies should be added into working capital as others Structure change of acquired working capital should be calculated on an average rate when calculating volume change See Appendix 1-6 for a detailed list of effects for the Group and the Business Areas

Monthly Net Working Capital Follow-up Monthly follow-up in reports, business area comments and CEO comments to the board NWC in MSEK, based on R-322 Stock Accounts Receivables Accounts Payables Other Relative NWC, % Change compared to last quarter, which Structure (acquisitions and divestments to be confirmed by BA) Volume compared to last period (as reported in cash flow) Currency (calculated as a residual of the above) (OB Quarter + CB Monthly) / 2 Last 3 months *4 OB = Opening Balance CB = Closing Balance

Monthly Cash Flow Follow-up Monthly cash flow model EBIT + Financial net * + Adjustment for depreciation and impairment losses (as reported in R-300) +/- Adjustment for items that do not require the use of cash (when applicable) + Paid tax * Cash flow from operating activities before change in working capital +/- Changes in working capital (volume as reported in NWC) Cash flow from operating activities Cash conversion ratio Cash flow from operating activities / EBIT * Calculated according to monthly forecast on Group level

Appendix Appendix 1 Appendix 2 Appendix 3 Appendix 4 Appendix 5 NWC Calculation Instruction Appendix 2 NWC Reporting Differences, Monthly versus Quarterly Appendix 3 Follow-up Structure and Changes - Group Appendix 4 Follow-up Structure and Changes – Business Area Appendix 5 Principles and Definitions - Group Appendix 6 Principles and Definitions – Business Area

NWC Calculation Instruction Appendix 1 Monthly NWC % NWC monthly volume change (CB in LC - OB in LC) x average currency rate for the period OB should always be December 31 previous year NWC volume change is always calculated year to date Monthly and quarterly volume change is derived by subtracting previously reported volume change from YTD figure NWC, MSEK Invoicing January (Dec + Jan) / 2 Last 3 months *4 February (Dec+ Feb) / 2 March Quarterly Calculation April (Mar + Apr) / 2 May (Mar + May) / 2 June July (Jun+Jul)/2 No closing August (Jun + Aug) / 2 September October (Sep + Oct) / 2 November (Sep + Nov) / 2 December NWC, MSEK Invoicing = NWC % OB = Opening Balance CB = Closing Balance LC = Local Currency

NWC Reporting Differences, Monthly versus Quarterly Appendix 2 NWC Reporting Differences, Monthly versus Quarterly Less detailed group consolidation No monthly adjustments on group level (ECONS) No monthly ICM-matching

Follow-up Structure - Group Appendix 3 Follow-up Structure - Group

Follow-up Structure – Business Areas Appendix 4 Follow-up Structure – Business Areas

Principles and Definitions - Group Appendix 5 Principles and Definitions - Group Principles Changes of any items in the balance sheet should be matched in the cash flow from operating activities, investing activities or financing activities The only exception is postponed tax, which doesn’t affect the cash flow Volume based change of working capital should comply with the change of working capital in the cash flow Balance sheet All accounts in the balance sheet Capital employed Total assets minus non interest-bearing liabilities Working capital Non interest-bearing current assets minus non interest bearing liabilities, exkluding taxes and provisions Cashflow From operating activities Result after financial items, deduction of depreciaton- and writedowns, adjustment for items that do not require cash and paid tax and change of working capital Change in working capital is matched with the volume based change in working capital in balance sheet From investing activities Investments and disposals of intangible and tangible assets, changes in long term receivables and acquisitons as well as disposal of businesses From financing activities Change in interest-bearing loans and investments, personnel related redemptions and share option programs

Principles and Definitions – Business Area Appendix 6 Principles and Definitions – Business Area Comprehensive principles Follow up at Business Areas is based on the operational activities according to the BA responsibilities Items where the responsibility lies within the ownership is not reported on a business area level, for exampel tax (See appendix 4) Changes of any items in the balance sheet should be reflected in the cash flow from operating activities and investing activities The volume based change in working capital should comply with the change of working capital in the cash flow Balance sheet Capital employed in additon to provisions for pensions Capital employed All assets excluding taxes, derivatives, pre paid financial items and liquid funds deducted with non interest-bearing liabilities excluding taxes, derivatives and accrued financial income and expenses Working Capital Current assets excluding taxes, derivatives, deferred financial income and expenses and liquid assets deducted with non interest bearing liabilities, excluding taxes and provisions Cash Flow Fom operating activities Operating result after less depreciations and write downs, adjustment for items that do not require cash and change of working capital Changes in working capital should match with the volume based change of working capital in the balance sheet No impact from net financial income/expenses or taxes From investing activities Investments and disposals of intangible and tangible assets, changes in long term receivables as well as acquisitions and disposals of businesses From financing activities Is not reported on a Business Area level