Q2”Solid underlying demand,
supply chain challenging”

April-June 2021

January-June 2021

■ Solid demand in the quarter. Constraints in the supply chain related to the ■ Strong, solid demand in the period. In some area the Covid-19
Covid-19 pandemic accelerated throughout the period leading topandemic led to increasing demand, whereas increasing shortages inextended lead times and sourcing related production disturbances.
the supply chain resulted in extended lead times and sourcing related
production disturbances.
■ Order intake increased +13%, currency adjusted strong growth of +23%,
net sales increased +3%, currency adjusted +13%. Growth mainly driven ■ Order intake increased +11%, currency adjusted strong growth ofby the battery sub-segments (part of the industrial segment) in business+22%, and net sales increased +3%, currency adjusted +13%. Growtharea AirTech and the swine segment in the US in business area
was mainly driven by the battery and pharma sub-segments (part of the
FoodTech. Also, Services had good growth.
industrial segment) in business area AirTech and the swine segment in■ The adjusted EBITA-margin at 14.2% (14.7), negatively impacted by
China and the US in business area FoodTech. Services had good
constraints in the supply chain and business mix change.
growth.
■ Leverage (net debt/adjusted EBITDA, LTM*) was at 1.9x, the same level ■ The adjusted EBITA-margin at 13.3% (11.7). The improvement wasat per end of March 2021.
mainly driven by increased net sales and high utilization rates, partly■ Net debt as of June 30 amounted to MSEK 2,209 compared to MSEK
offset by supply chain constraints.
2,208 at the end of March 2021. In the second quarter a 5-year■ Leverage (net debt/adjusted EBITDA, LTM*) was at 1.9x, the same
re-financing was secured enabling execution of the long-term strategy.
level at per end of December 2020 and lower than same period last
■ The strategy implementation with measures aiming at sharpening theyear (2.7x).
customer offering and footprint optimization is progressing. A total of■
Net debt as of June 30 amounted to MSEK 2,209 compared to
MSEK 89 was recorded as Items Affecting Comparability (IACs) in the
MSEK
2,116 at the end of December 2020.
quarter in business areas AirTech (MSEK 15) and FoodTech (MSEK 74).
The main part of the cost was recorded as provisions related mainly to
product rationalization in Europe as well as a phase out of a 1st
generation IoT offering (severance, warranty claims, inventory, etc.).
In addition, costs were recorded as incurred related to consultancy
services for the execution of the strategy implementation.
Financial summary

Q2

Jan-JunLTM*

Full year

MSEK

2021

2020 ∆%

2021

2020

∆%

Jul-Jun

2020

Order intake

2,118

1,870

13

4,113

3,719

11

7,643

7,249

Net sales

1,822

1,773

3

3,434

3,340

3

7,109

7,015

Operating profit (EBIT)

147

103

43

369

212

74

863

707

Adjusted EBITA

259

260

-1

457

390

17

972

906

Adjusted EBITA margin, %

14.2

14.7

13.3

11.7

13.7

12.9

Net income

84

39 113244

96

Earnings per share before dilution, SEK

0.46

0.21

1.33

0.53

Earnings per share after dilution, SEK

153

579

432

3.16

2.35

0.45

0.21

1.33

0.53

3.15

2.35

Average number of outstanding shares before dilution

182,016,452

181,745,802

181,968,367

181,745,802

181,655,871

181,545,456

Average number of outstanding shares after dilution

182,798,778

181,745,802

182,701,021

181,745,802

182,257,343

181,557,708

The KPI´s below includes discontinued operations **Net income

84

38

244

95

575

426

Earnings per share before dilution, SEK

0.46

0.20

1.33

0.52

3.13

2.32

Earnings per share after dilution, SEK

0.45

0.20

1.33

0.52

3.12

2.32

Cash flow from operating activities

159

282

247

309

896

959

Net debt

2,209

2,895

2,209

2,895

2,209

2,116

1.9

2.7

1.9

1.9

Net debt/Adjusted EBITDA, LTM* Last twelve months** Discontinued operations is defined as the business connected to the Data Centers operations in Dison, Belgium, where the production ceased during fall 2019 but minor installation services reamained at customer sites
during 2020. All income statement items in this report refers to Munters continuing operations, if not otherwise stated.

Second quarter, 2021»

CEO comments
Continued good underlying demand driven by industrial segment
In the second quarter demand continued to be solid, mainly driven by the battery sub-segment in the industrial segment of business area AirTech. Increased constraints in the supply chain due to Covid-19 throughout the quarterleading to longer lead times and sourcing related production disturbances. Costs continued to increase for raw material and freights. We have implemented consecutive price increases in 2021. These will come into effect over the
coming quarters with the majority effect next year due to extended lead times.

Solid and gooddemand, butconstraints inthe supply chain
estimated toremain throughout the year.

Margin impacted by constraints in supply chain
We achieved solid order intake and net sales in the second quarter, both reported and currency adjusted. Region
APAC showed strong growth driven by the battery sub-segment in AirTech, offset by a weaker swine market in
China for FoodTech. Americas had good growth mainly because of the battery sub-segment in AirTech as well as
the broiler, swine, layer and dairy segments in FoodTech. Region EMEA grew driven mainly by the battery subsegment and the components segment in AirTech as well as growth in the greenhouse segment in FoodTech.
The adjusted EBITA-margin was weaker in the quarter due to supply chain disturbances, increased raw material
and freight costs. In addition, a changed business mix had a negative impact on the margin.
Continued implementation of strategy and FoodTech strategy launch
The execution of our long-term strategy continued in the quarter with business area AirTech making an acquisitionof a patent with the purpose of strengthening their technology position in the US core business. A frame agreementwith a large data center hyperscale player was secured that will result in increased recurring revenues to this segment. Services also is expanding the footprint by setting up operations in Norway and Ireland. Business area
FoodTech launched an updated strategy aiming at accelerating the digital journey and strengthen the equipment
position. Already in the second quarter actions to strengthen the organization was taken resulting in new leadership for the area of Connected farms. In addition, Munters secured a 5-year re-financing of the main existing termloan and revolving credit facility, strengthening our ability to execute on the long-term strategy.

Klas Forsström, President and CEO

Supply chain constraints predicted to remainMarket demand continued to be solid and at the same time, operations were impacted by the Covid-19 pandemic
through constraints in the supply chain. Currently, constraints are predicted to remain in the second half of 2021.
I would like to extend my sincere appreciation to our employees for their dedication to our customers and Munters.
Klas Forsström, President and CEO

Mid-term financial targets

Sustainability

Net sales growth: Annual growth in currency adjusted net salesof 5%, as of 2019, supplemented with selected add-on acquisitions. Performance Q2 2021: +13% (-6%)

Progress made in the second quarter 2021:

Adjusted EBITA-margin: An adjusted EBITA-margin of 14%.
Performance Q2 2021: 14.2% (14.7%)
Capital structure: A ratio of net debt to adjusted EBITDA of
1.5x to 2.5x, and may temporarily exceed this level (e. g. as aresult of acquisitions). Performance Q2 2021: 1.9x (1.9x)
Dividend policy: Munters aim to pay an annual dividend
corresponding to 30-50% of its consolidated income after tax forthe period.
Dividend 2020: 30% (SEK 0.70 per share, totaling MSEK 127)
For full description of the dividend policy, see the Annual and Sustainability report
2020, page 8.

2

Quality: Decision taken on implementation of ISO certification
9001:2015; 14001:2015; 45001:2018 for all Munters production
sites.
Environment: Target set for Net zero emissions, including
Scope 1 and Scope 2* by 2030. All locations at Munters included.
Governance: Sustainability KPIs integrated in strategy framework. Sustainability training for top managers.
*As defined by the Greenhouse Gas Protocol
Please see the Munters Annual and Sustainability report 2020, page 38-49, for further information on goals and outcome.

Second quarter, 2021

Financial performance
Q2

Jan-JunLTM Full year

MSEK

2021

2020

∆%

2021

2020

∆%

Jul-Jun

2020

Order intake

2,118
1,495
636
-14
1,822
1,265
567
-10
259
205
80
-26
14.2
16.2
14.1

1,870
1,231
656
-17
1,773
1,207
575
-8
260
181
98
-19
14.7
15.0
17.1

13
21
-3
-22
3
5
-1
17
-1
13
-18
38

4,113
2,979
1,156
-22
3,434
2,460
992
-17
457
385
119
-47
13.3
15.7
12.0

3,719
2,574
1,172
-27
3,340
2,334
1,023
-18
390
281
150
-41
11.7
12.0
14.6

11
16
-1
-21
3
5
-3
-2
17
37
-21
17

7,643
5,505
2,180
-42
7,109
5,062
2,095
-48
972
794
279
-100
13.7
15.7
13.3

7,249
5,101
2,196
-48
7,015
4,937
2,126
-48
906
689
310
-94
12.9
14.0
14.6

AirTechFoodTech
Other and eliminations

Net sales

AirTechFoodTech
Other and eliminations

Adjusted EBITA

AirTechFoodTech
Other and eliminations

Adjusted EBITA margin, %AirTechFoodTech

Order intake Q2,
currency adjusted change+23%
Net sales Q2,
currency adjusted change+13%
Adj. EBITA-margin Q2

14.2%

ORDER INTAKE
April-June 2021

Order intake increased by +13%, a currency adjusted increase of +23%, driven mainly by a strong growth in thebattery sub-segment within business area AirTech. The order backlog increased +13% to MSEK 3,018 (2,660),
currency adjusted +21%.
AirTech increased by +21%, a currency adjusted increase of +33%. Excluding the non-core commercial business
US, exited in 2020, the increase was appr. +35% currency adjusted. The strong growth was driven mainly by thebattery sub-segment in regions APAC and Americas. The Component segment had significant growth, driven bysales through OEMs (Original Equipment Manufacturers) to the Battery sub-segment and Data Centers. Mist Elimination will change name to Clean Technologies from January 1 2022, reflecting a strategic direction where they will
increase the focus on renewables in both energy generation and fuels. Mist Elimination grew slightly in the quarter,
driven by increased demand in process industries. Data Centers US had good underlying demand, with an increase of quotation activities. However, order intake was lower than in 2020. Services experienced growth in all
regions, with strong growth in APAC and Americas.
FoodTech decreased by -3%, a currency adjusted increase of +5%. Region Americas and EMEA had good currency adjusted growth, offset by a decrease in region APAC. Americas grew because of continued growth in the
broiler, swine, layer and dairy segments in the US. EMEA grew driven mainly by increased orders for controllers tothe broiler segment in the US. APAC had order intake below previous year, on the back of a very strong order intake in the swine segment in China then. During the second quarter China has experienced pockets of outbreaksof the African Swine Fever (AFS) that had a negative impact on demand.

January-June 2021

Order intake increased by +11%, a currency adjusted increase of +22%, driven mainly by strong growth in the battery and pharma sub-segment in business area AirTech. The order backlog increased +13% to MSEK 3,018(2,660), currency adjusted +21%.
AirTech increased +16%, a currency adjusted increase of +28%. Excluding the non-core commercial business US,
exited in 2020, the increase was appr. +31% currency adjusted. Growth was driven mainly by the battery sub-segment in Americas and APAC as well as the pharma sub-segment in the US. Components had good growth driven
by the battery sub-segment. Mist Elimination had continued weak order intake and Data Centers US was flat. Services grew driven by a good development in Americas and APAC, whereas EMEA had a flat development.
FoodTech order intake decreased -1%, a currency adjusted increase of +8%. Region Americas experienced
growth (currency adjusted) mainly driven growth in the swine, layer and dairy segments in the US. Region EMEA
had growth as demand for controllers produced in EMEA and greenhouse solutions was good. In APAC order intake was lower, on the back of the strong growth seen in the swine segment in China in last year.

3

Quarterly order intake, 2021
(MSEK)
2,500

10,000

2,000

8,000

1,500

6,000

1,000

4,000

500

2,000

0

Q2

Q3

Q4

Q1

Quarter

Q20
LTM

Order intake per region Q2,2021 (MSEK)

24%

40%

36%
Americas

EMEA

APAC

Second quarter, 2021

NET SALES

April-June 2021

Net sales increased +3%, a currency adjusted increase of +13%, driven mainly by an increase in the battery subsegments and Services in business area AirTech. Services net sales amounted to 15% of total net sales.
AirTech increased +5%, a currency adjusted increase of +15%. Excluding net sales to the non-core commercial
business US, exited in 2020, currency adjusted net sales increased appr. +23%. Growth was driven mainly by thebattery sub-segment in APAC and Americas. The Components segment had good growth driven mainly by the battery end customers. Both Data Centers US and Mist Elimination grew slightly. Services grew in all regions.
FoodTech decreased -1%, a currency adjusted increase of +7%, driven by a stronger swine market in the US andthe layer, broiler and greenhouse markets in region EMEA. The equipment business had good growth in region
Americas driven by the layer, swine and dairy segments. Region EMEA grew mainly because of good developmentin the greenhouse segment. Sales declined in APAC on the back of a very strong swine market in China last year.

January-June 2021

Net sales increased +3%, a currency adjusted increase of +13%, driven by an increase in the battery and pharma
sub-segments and Services in business area AirTech. In addition, business area FoodTech had good growth inseveral segment sin the US. Services net sales amounted to 14% of total net sales.
AirTech increased +5%, a currency adjusted increase of +16%. Excluding net sales to the non-core commercial
business US, exited in 2020, currency adjusted net sales increased appr. +23%. Growth was driven mainly by thebattery sub-segment in APAC and Americas. In addition, the pharma sub-segment grew in the US driven by Covid19 relief efforts and production of test equipment. Data Centers US grew, while Mist Elimination declined as themarine and power market continued to be weak. Services grew in region Americas and APAC, whereas EMEA remained flat.
FoodTech decreased -3%, a currency adjusted an increase with +6%, driven by a good growth in the swine segment in China and the US. The equipment business in region Americas grew driven by the swine, layer and dairy
segments. The software business in the subsidiary MTech Systems grew slightly over last year. Region EMEA
grew slightly as the broiler and greenhouse market experienced good demand mainly in Southern Europe.

4

Quarterly net sales, 2021
(MSEK)
2,000

8,000

1,500

6,000

1,000

4,000

500

2,000

0

Q2

Q3

Q4

Q1

Quarter

0

Q2

LTM

Net sales per region Q2,2021 (MSEK)

25%
40%

36%
Americas

EMEA

APAC

Second quarter, 2021

RESULTS
Adjusted EBITA excludes Items Affecting Comparability, IAC, see page 5-6 for disclosure of the IACs.

April-June 2021

The gross margin for the second quarter at 34.7% (35.6), negatively impacted by constraints in the supply chain.
Increased raw material and freight costs, resulted in longer lead times and sourcing related production disturbances.
Adjusted EBITDA at MSEK 311 (313), corresponding to an adjusted EBITDA-margin of 17.1% (17.7). Depreciation
amounted to MSEK -53 (-53), whereof depreciation of leased assets was MSEK -26 (-25). Adjusted EBITA at
MSEK 259 (260), corresponding to an adjusted EBITA-margin of 14.2% (14.7). The lower margin a result of alower margin in business area FoodTech and investing in resources in the corporate staff functions.
Adjusted EBITA for business area AirTech at MSEK 205 (181) corresponding to an EBITA-margin of 16.2% (15.0).
The margin increased because of increased net sales and high utilization rates, partly offset by constraints in the
supply chain, increased freight costs and a changed business mix.
Adjusted EBITA in business area FoodTech at MSEK 80 (98), corresponding to an adjusted EBITA-margin of
14.1% (17.1). The margin was negatively impact by increased raw material, freights costs and a changed businessmix. The margin in the second quarter 2020 was strong as a consequence of strong growth in the swine market in
China.
Adjusted EBITA for Other amounted to MSEK -26 (-19). The increase is related to competence strengthening related costs for corporate staff functions.
Operating profit (EBIT) at MSEK 147 (103), corresponding to an operating margin of 8.1% (5.8). Amortization andwrite-downs on intangible assets in the second quarter was MSEK -21 (-20), where MSEK -7 (-10) was related toamortization of intangible assets from acquisitions.

January-June 2021

The gross margin for the first six months was at the same level as last year 34.1% (34.1).
Adjusted EBITDA at MSEK 561 (500), corresponding to an improved adjusted EBITDA-margin of 16.3% (15.0).
Depreciation amounted to MSEK -105 (-110), whereof depreciation of leased assets was MSEK -52 (-56).
Adjusted EBITA at MSEK 457 (390), corresponding to an improved adjusted EBITA-margin of 13.3% (11.7). The
margin improved because of a higher margin in business area AirTech.
Adjusted EBITA for business area AirTech at MSEK 385 (281) corresponding to an adjusted EBITA-margin of
15.7% (12.0). The margin improved because of increased net sales and high utilization rates, partly offset by constraints in the supply chain and sourcing related production disturbances. A good focus on efficiency improvements
initiatives across the organization as well as effects from the Covid-19 pandemic contributed to continued low indirect costs.
Adjusted EBITA in business area FoodTech at MSEK 119 (150), corresponding to an adjusted EBITA-margin of
12.0% (14.6). The margin was negatively impacted by increased raw material and freight costs due to supply chain
constraints. The margin in 2020 was strong mainly because of growth in the swine market in China.
Adjusted EBITA for Other at MSEK -47 (-41). Other mainly includes costs for corporate staff functions.
Operating profit (EBIT) at MSEK 369 (212), corresponding to an operating margin of 10.7% (6.4). Amortization andwrite-downs on intangible assets for the first six months was MSEK -38 (-40), where MSEK -15 (-21) was related toamortization of intangible assets from acquisitions.

ITEMS AFFECTING COMPARABILITY (IAC)
Items affecting comparability (IAC) on EBITA in the second quarter mainly related to activities connected with thestrategy implementation within business area FoodTech of MSEK -74, with an aim to accelerate the digital journeyand strengthen the equipment position. The major part of the costs were recorded as provisions relating to severance, warranty claims, inventory etc. Part of the costs relate to consultancy services for the execution of the strategy implementation received during the quarter. For business area AirTech the work with the strategy implementation launched last year has continued and MSEK -15 has been recorded as IACs for the second quarter, mainly
related to consultancy services for the strategy implementation.
IACs for the first six months mainly relates to strategy implementation work within FoodTech of MSEK -74, within
AirTech of MSEK -22 and within Other of MSEK -4. In addition, Munters has had IACs of MSEK 52, mainly comprising a net of a final settlement in regards to a customer claim (Hunters New England Health District), of5

Quarterly gross margin, %
36%
34%
32%
30%

Q2

Q3

Q4

Q1

Q2

Quarterly adjusted EBITDA
margin, %
20%
10%
0%

Q2

Q3

Q4

Q1

Q2

Quarterly adjusted EBITA
margin, %
20%
10%
0%

Q2

Q3

Q4

Q1

Q2

Quarterly EBIT margin, %
20%
10%
0%

Q2

Q3

Q4

Q1

Q2

Second quarter, 2021

MSEK -9, and insurance compensation received linked to the previous exchange of specific components at a customer site within the European Data Center business of MSEK 61.
During the second quarter last year, Munters incurred IACs related to the implementation of a refined strategy of
MSEK -136, mainly within business area AirTech. The major part of the cost was recorded as a restructuring provision and related to severance, warranty claims and winding down activities for the exit of the non-core part of thecommercial business in the US. A part of the cost related to write-downs of inventory. As a consequence of Covid19 a decision was taken in the second quarter 2021 to delay the implementation of some of the measures in AirTech. All measures are estimated to be implemented by the end of 2022 or start of 2023. Total savings from themeasures in AirTech are estimated to MSEK 70.
In addition, and as previously communicated, a provision of MSEK -6 for regulatory fines and fees for a ten year
old dispute regarding a potential liability under ISRA (Industrial Site Recovery Act) was recorded. Munters also incurred Covid-19-related IACs, in terms of a net of strictly Covid-19-related expenses and received government
grants for e.g. social security contributions.
For further information, see the reconciliation of Munters alternative performance measures on page 22.
Q2
MSEK
Covid-19 related items
Implementation refined strategy
Other items affecting comparability
AirTechCovid-19 related items
Implementation refined strategy
Other items affecting comparability
FoodTech
Covid-19 related items
Implementation refined strategy
Other items affecting comparability
Other
Covid-19 related items
Implementation refined strategy
Other items affecting comparability
Total

2021
0
-15
-1
-15
-0
-74
-1
-75
0
0
-0
-89
-1
-91

Jan-Jun
2020
4
-123
-6
-125
-0
-5
-6
1
-8
-7
4
-136
-6
-138

2021
-0
-22
61
39
-1
-74
-1
-76
-4
-9
-12
-1
-101
52
-50

LTM
2020
4
-123
-6
-125
-0
-5
-6
1
-8
-7
4
-136
-6
-138

Jul-Jun
2
-8
74
69
0
-75
6
-69
-0
-6
-17
-23
2
-89
63
-23

2020
Full year
7
-109
7
-95
1
-6
6
1
1
-10
-8
-18
8
-124
5
-111

FINANCIAL ITEMS
Financial income and expenses for the second quarter amounted to MSEK -25 (-50). The financial expenses werepositively impacted by a lower USD interest rate and lower interest bearing debt compared to same quarter lastyear. Interest expense on lease liabilities amounts to MSEK -4 (-4) in the second quarter. The average weighted
interest rate including fees per end of the quarter was 2.1% (3.2).
Financial income and expenses for the first six months amounted to MSEK -50 (-80).

TAXES
Income taxes for the second quarter was MSEK -37 (-13). The effective tax rate in the second quarter was 31%(25). The higher effective income tax rate was partly driven by increased withholding tax expense due to dividends
in 2021 and a tax expense related to previous years in Mexico. Income taxes for the first six months was
MSEK -75 (-35). The effective tax rate for the first six months was 24% (27).

Tax rate, 2021 %
40%

6

16%

20%
0%

31%

25% 24%

Q2

Q3

Q4

19%

Q1

Q2

Second quarter, 2021

EARNINGS PER SHARE
Net income, including the discontinued operation, attributable to Parent Company’s ordinary shareholders
amounted to MSEK 83 (37) for the second quarter. Earnings per share, before dilution, in the second quarter 2021
was SEK 0.46 (0.20). Earnings per share, after dilution, in the second quarter 2021 was SEK 0.45 (0.20). Earnings
per share, before dilution, for the first six months 2021 was SEK 1.33 (0.52). Earnings per share, after dilution, in
the first six months 2021 was SEK 1.33 (0.52).

EPS, 2021 SEK
1.2

0.87

0.92

0.87
0.46

0.7

0.20

0.2
Q2

-0.3

Q3

Q4

Q1

Q2

The average number of outstanding ordinary shares in the second quarter, for the purpose of calculating earnings
per share, was 182,016,452 before dilution and 182,798,778 after dilution.

FINANCIAL POSITION
Interest-bearing liabilities amounted to MSEK 2,629 (3,440). Cash and cash equivalents amounted to MSEK 680(827) as of June 30.
In the second quarter Munters refinanced primary financing facilities by establishing a new term loan of MUSD 165
and a Revolving Credit Facility (RCF) of MEUR 250 with final maturity date in June 2026. The facilities are granted
by a group of six banks and have no mandatory amortization requirement. The bank group consist of six banks;
Svenska Handelsbanken AB (publ), BNP Paribas SA Bankfilial Sverige, Danske bank A/S, Nordea Bank Abp filial
Sverige, Skandinaviska Enskilda Banken AB (publ) and Swedbank AB (publ). The loan agreement has one financial covenant, consolidated net debt in relation to adjusted EBITDA, with some adjustments made in accordancewith the loan agreement. The accounting standard for leases, IFRS 16, does not affect the covenant calculationaccording to the loan agreement definition and neither does the net pension liability.
Munters also has a backup facility of MSEK 750 maturing in 2023, which is secured by a guarantee from EKN (The
Swedish Export Credit Agency). Refinancing fees activated in the balance sheet related to the 2021 refinancing
event amounts to MSEK 21 which will be amortized over four years. For weighted interest cost see more information on page 6 under Financial Items.
Net debt as of June 30 amounted to MSEK 2,209 compared to MSEK 2,208 at the end of March 2021 and MSEK
2,116 at the end of December 2020. The increase of net debt in the first six months was mainly related to changes
in the exchange rate USD/SEK as well as dividend payment. For more information about reconciliation of net debt
and leverage see page 23.

Net Debt per quarter

3,000

2.7

2.5
1.9

1.9

Q4

Q1

1.9

2,000
1,000
0

Q2

Q3
Quarter

Q2
Leverage

The leverage ratio per end of June was 1.9 which was the same ratio as per end of March 2021.
At quarter end the term loan of MUSD 165 was fully drawn. Of the revolving credit facility an amount of MEUR 86(83) was utilized in EUR, SEK and USD. Available unutilized under the RCF MEUR 250 as of June 30 amounted to
MEUR 164 (102) while the RCF MSEK 750 was entirely unutilized. Along with the main loan facility, an amount of
MSEK 5 (26) in local debt is outstanding in i.a. India.
Average capital employed for the last twelve months was MSEK 7,042 (7,738). Return on capital employed, including the discontinued operation, (ROCE) for last twelve months was 12.2% (1.8). EBIT plus financial income wasaffected by a restructuring provision related to the closure of the Data Center operations in Dison, Belgium, in thethird quarter of 2019, impacting the last year period return. Return on capital employed, where EBIT plus financial
income is adjusted for items affecting comparability (IAC) and average capital employed adjusted for goodwill, forthe last twelve months was 30.0% (22.5).

CASH FLOW
Cash flow from operating activities was MSEK 159 (282) in the second quarter and MSEK 247 (309) for the first six
months of 2021.
Cash flow from changes in working capital had a positive impact on cash flow of MSEK 39 (85) in the second quarter and a negative impact of MSEK -99 (28) for the first six months of 2021. The positive effect on cash flow fromworking capital in the second quarter came from a mix of various items. For the first six months, the negative effecton cash flow from working capital mainly relates to increased inventory levels as lead times have increased.
Total cash flow for the second quarter amounted to MSEK -233 (-53) and MSEK -304 (115) for the first six monthsof 2021. Dividends of MSEK 129 was paid in May, whereof MSEK 2 to an external minority in one of the subsidiaries. In addition, a net amortization on external debt of MSEK 168 (251) was made in the second quarter. Net amortization for the first six months was MSEK 243 (33).

7

ROCE %, 2021
15%
7.3%

10%
5%
0%

9.5%

11.3% 12.2%

1.8%
Q2

Q3

Q4

Q1

Q2

Second quarter, 2021

PARENT COMPANY AND OWNERSHIPThe parent company for the Group is Munters Group AB. All Group supporting functions within Munters is accounted for within Munters Group AB. The company holds shares in subsidiaries, cash and accounts payables.
The Parent Company does not engage in sales of goods and services to external customers. Cash and cash
equivalents at the end of the period amounted to MSEK 2 (13).

EMPLOYEESThe number of permanent FTEs (Full Time Equivalents), at June 30, 2021 was 3,272 (3,149). The amount of FTEs
at June 30, 2021 in business area AirTech was 2,375 (2,245), in FoodTech 813 (838) and at Group functions 84(65).

OUTSTANDING SHARESAs of June 30, 2021, Munters held 1,963,163 treasury shares of the total outstanding shares of 184,457,817.

DIVIDEND
During 2020 Munters established a solid base with increased profitability and a strengthened capital structure. The
leverage was at 1.9x at year-end, which is within the mid-term target range for net debt to adjusted EBITDA of
1.5x-2.5x. A dividend of SEK 0.70 (0.0) per share was paid in May 2021, in total MSEK 127. This represented 30
per cent of the net income 2020.

OTHER EVENTS
Munters collaborates with CTT to design more efficient humidifiers that create the perfect climate conditions inside aircraft – In February it was announced that Munters Group AB, has teamed up with CTT Systems
AB (CTT), the market leader of aircraft humidity control system, to develop a new type of evaporative media thataims to improve efficiency and performance of CTT’s aircraft humidifiers.

Ten largest shareholders%
FAM ABODIN Funds
First Swedish National Pension
Swedbank Robur Funds
Fourth Swedish National Pensio
Handelsbanken Funds
Columbia Threadneedle
C WorldWide AssetManagement

30 Jun
Total
26.6
9.0
8.4
7.7
5.2
4.1
3.8

La Financière de l'Echiquier
Vanguard

Peter Gisel-Ekdahl, former President of Business Area AirTech, has left Munters – In April it was announced
that Peter Gisel-Ekdahl, President of Munters Business Area AirTech, has decided to pursue an opportunity outside Munters as CEO of a company based in the Nordic region. Peter has supported a successful transition andstayed within Munters during the second quarter of 2021. Klas Forsström, CEO and President of Munters has, inaddition to his current role, taken on the responsibility for AirTech to ensure the future growth plans and continuous
focus on strategy deployment.
Continued implementation of the strategy, taking the next steps in business area FoodTech – In May it wasannounced as part of the strategy implementation that business area FoodTech has completed a strategic review
outlining measures to strengthen its digital offering and climate solutions part of the business. Implementation has
started in the second quarter 2021. Costs are estimated to approximately MSEK 140, of which approximately
MSEK 110 are estimated to have a cash flow impact. In addition, there will be capex investments made amounting
to an estimated MSEK 20. The full-year positive impact on adjusted EBITA in 2023 is estimated to be approximately MSEK 70.
Annual General Meeting 2021 – The annual general meeting was held on Wednesday 19 May 2021. The general
meeting resolved in accordance with the nomination committee’s proposal and re-elected the board membersHåkan Buskhe, Helen Fasth Gillstedt, Per Hallius, Magnus Lindquist, Lena Olving, Kristian Sildeby, Juan Vargues
and Anna Westerberg, and the chairman of the board of directors Magnus Lindquist. An interview with the president and CEO Klas Forsström and the chairman of the board of directors Magnus Lindquist is available on Munters
website, www.munters.com.

EVENTS AFTER THE CLOSE OF THE PERIOD
Launch of Munters DSS Pro: the next level of dehumidification – Munters announced in July the DSS Pro thatis an evolutionary leap forward from the market-leading DSS. Suitable for indoor or outdoor installation, the DSS
Pro is equipped with our new AirPro casing. This new enclosure offers significantly improved durability, reduced air
leakage, and lower energy consumption.
Sofia Gellar, GVP HR & Sustainability to leave Munters – in July Munters announced that Sofia Gellar, GVP HR& Sustainability, had decided to pursue an opportunity outside Munters as Chief Officer HR at H2 Green Steel. Sofia Gellar joined Munters in 2018 as GVP HR & Communication and took on the responsibility for Sustainability in
2019. Sofia will support a successful transition and stay within Munters throughout 2021.

8

The Munters DSS Pro, the next levelof dehumidification, an evolutionary
leap forward from the market-leading
DSS.

2.5
2.2
1.8

Second quarter, 2021

AirTechBusiness area AirTech is a global leader in energy-efficient air treatment for industrial and commercial applications. We offer solutions formission-critical processes that require exact control of moisture and temperature, with a focus on energy-efficiency and sustainable climate
systems. Our climate systems also provide better indoor air quality and comfort, as well as increased production capacity.

■ Order intake increased in the second quarter mainly driven by the battery sub-segment in regions APAC and Americas. The Component segment hadsignificant growth and Mist Elimination grew slightly. Data Centers US experienced good underlying demand, however had lower order intake than in
2020. Services experienced growth in all regions, with strong growth in APAC and Americas.
■ Net sales increased driven mainly by strong growth in the battery sub-segment in region APAC and Americas. The Components segment had good
growth driven mainly by the battery end customers. Both Data Centers US and Mist Elimination grew slightly. Services grew in all regions.
■ The adjusted EBITA margin improved mainly as an effect of increased net sales and high utilization rates, partly offset by constraints in the supply
chain, increased freight costs and a change business mix.
Q2
Jan-JunLTM Full year

MSEK
Order intake
GrowthNet sales
Growthof which organic growthof which currency effects

Operating profit (EBIT)
Adjusted EBITA
GrowthAdjusted EBITA margin, %

2021
1,495
21%
1,265
5%
15%
-11%
185
205
13%
16.2

2020
1,231
-3%
1,207
-9%

∆%
21

51
181
-9%
15.0

262
13

5

2021
2,979
16%
2,460
5%
16%
-11%
416
385
37%
15.7

2020 ∆%
2,574
16
-5%
2,334
5
-6%
146
281
-9%
12.0

186
37

Jul-Jun
5,505
8%
5,062
1%

2020
5,101
-3%
4,937
-4%

835
794
25%
15.7

565
689
4%
14.0

FoodTechBusiness area FoodTech is one of the world’s leading suppliers of innovative, energy-efficient climate systems for livestock farming andgreenhouses, as well as software for controlling and optimizing the entire food production value chain. Our solutions increase productivity
while contributing to sustainable food production, where strict requirements are placed on quality, animal health and food safety.

■ Currency adjusted order intake increased in the second quarter with good growth in region Americas and EMEA, offset by a decrease in region APAC.
Americas grew because of continued growth in the broiler, swine, layer and dairy segments in the US. EMEA grew driven mainly by increased orders forcontrollers to the broiler segment in the US. APAC declined, on the back of a very strong order intake in the swine segment in China previous year.
■ Currency adjusted net sales increased driven by a stronger swine market in the US and the layer, broiler and greenhouse markets in region EMEA.
Sales declined in APAC on the back of a very strong swine market in China last year.
■ The adjusted EBITA-margin declined impacted by increased raw material, freights costs and a changed business mix. The margin in the second quarter2020 was strong as a consequence of strong growth in the swine market in China.
Q2

MSEK
Order intake
GrowthNet sales
Growthof which organic growthof which currency effects

Operating profit (EBIT)
Adjusted EBITA
GrowthAdjusted EBITA margin, %

9

2021
636
-3%
567
-1%
7%
-8%
-6
80
-18%
14.1

Jan-Jun

2020
656
13%
575
2%

∆%
-3
-1

87 -10798 -18
15%
17.1

2021
1,156
-1%
992
-3%
6%
-9%
26
119
-21%
12.0

LTM Full year

2020 ∆%
1,172
-1
8%
1,023
-3
-1%
134
150
14%
14.6

-81
-21

Jul-Jun
2,180
0%
2,095
3%

2020
2,196
5%
2,126
5%

183
279
-6%
13.3

291
310
12%
14.6

Second quarter, 2021

About Munters
Munters is a global leader in energy-efficient and sustainable climate solutions. The solutions guarantee
temperature and humidity control, which is mission-critical for customers. Munters offers solutions to manydifferent industries where controlling temperature and humidity is mission-critical. Our solutions reduce
customers’ climate and environmental impact through lower resource consumption, and in the process contributeto cleaner air, higher efficiency and reduced carbon emissions. Sustainability is an important part of Munters’
business strategy and value creation.
Short facts

■
■
■
■
■

3,500 employees
30 countries with sales and manufacturing
17 production units
22% female leaders
Two business areas: AirTech and FoodTech

PurposeFor customer success and a healthier planet
Curiosity and a drive to create pioneering
technologies are part of our DNA. Our climate
solutions are mission-critical to our customers’
success and contribute to a more sustainable
planet.

In 2020 AirTech generated 70% of the total net
sales of Munters and FoodTech 30%.

The strategy of Munters
Munters has a strong position in most of our markets. We see major opportunities to improve and strengthen our market position and to achieve our mid-term
financial targets and deliver on our strategy. The key to success is how we respond in working toward our goals. Our overarching strategic priorities show whichareas we regard as important to our success. For each strategic priority we have clear action plans and ambitions what we want to achieve. Sustainability is apriority issue reflected in every strategic priority.
People - The employees at Munters are the hub of our business. Through collaboration and a passion for creating sustainable solutions for our customers andpartners, we contribute to our customers’ success and a better world.
Customers - We closely cooperate our customers. We try not only to understand their needs today, but also in
the future. Our expertise is built through unique insight into our customers’ businesses and production
processes. Munters works every day to deliver value over and above our customers’ expectations.
Innovation - We at Munters work in a structured way to optimize innovation in the organization. We continuallymonitor technological developments in the market and work closely with our customers to understand theirneeds. We also work with other institutions that strengthen our competence and create value for customers. By
continuously questioning and improving how we work, we create sustainable solutions, technologies andbusiness models for the future.
Market - Munters is active around the world in a market driven by strong trends in sustainability and digitization. We focus resources on strengthening our position in areas where we can be a market leader. For
Munters, a market leader not only has a leading position but also higher profitable growth than others in the industry.
Excellence in everything we do - We strive for quality and efficiency in everything we do. We work with continuous improvements in every area. We prioritize
and focus on selected investments and areas of improvement. We follow up, learn, correct and improve.
Sustainability
Sustainability is one of the most important drivers for Munters’ strategy today and in the future. Everything we do has to be sustainable for all our stakeholders
and the environment. Our medium-term financial targets are important to create room for investments in the future. As we work toward these targets, we makevarious decisions and act in the best way to achieve our ambitions. These ambitions contain priorities on resource efficiency, responsible business practices andpeople & society. These three parts today constitute the framework for Munters’ sustainability agenda.

10Second quarter, 2021¨

11

Second quarter, 2021

Quarterly overview Group and Segments
Group

2021

MSEK

Q2

Q1

Q4

Q3

Q2

Q1

Q4

Q3

Q2

3,018
2,118
1,822
147
84
-21
-91
259
14.2

2,769
1,995
1,612
222
160
-17
41
198
12.3

2,253
1,611
1,841
250
172
-17
22
245
13.3

2,664
1,919
1,833
245
163
-30
4
271
14.8

2,660
1,870
1,773
103
39
-20
-138
260
14.7

2,808
1,849
1,566
110
57
-20
−
130
8.3

2,307
1,845
1,842
159
76
-29
-42
229
12.5

2,440
1,680
1,813
174
100
-32
-42
248
13.7

2,496
1,840
1,877
185
104
-41
-36
262
13.9

Order backlog
Order intake
Net sales
Operating profit (EBIT)
Net income
Amortization and write-down
Items affecting comparability (IAC)
Adjusted EBITA
Adjusted EBITA margin, %

2020

2020

2019

AirTech

2021

MSEK

Q2

Q1

Q4

Q3

Q2

Q1

Q4

Q3

Q2

2,318
1,495
1,264
1
185
-4
-15
−
205
16.2

2,129
1,483
1,193
2
231
-4
54
−
181
15.1

1,737
1,172
1,321
2
234
-4
26
-0
211
15.9

2,025
1,354
1,270
9
185
-16
3
−
198
15.4

2,003
1,231
1,205
2
51
-5
-125
−
181
15.0

2,186
1,343
1,127
0
94
-5
−
−
100
8.8

1,780
1,361
1,378
4
159
-9
-19
-1
186
13.4

1,886
1,179
1,286
1
151
-5
-11
−
167
12.9

1,926
1,264
1,323
1
173
-13
-14
−
199
15.1

External order backlog
Order intake
External net sales
Transactions between segments
Operating profit (EBIT)
Amortization and write-down
Items affecting comparability (IAC)
Re-allocation of internal services
Adjusted EBITA
Adjusted EBITA margin, %

2020

2019

Q1 Full year Full year
2,554
1,938
1,620
38
3
-32
-61
131
8.1

2019

2,253
7,249
7,015
707
432
-87
-111
906
12.9

2,307
7,302
7,153
556
283
-134
-181
871
12.2

2020

2019

Q1 Full year Full year
1,993
1,449
1,164
2
82
-5
-23
−
110
9.4

1,737
5,101
4,924
13
565
-30
-95
-0
689
14.0

1,780
5,253
5,151
8
565
-31
-67
-1
662
12.8

2020

2019

FoodTech

2021

MSEK

Q2

Q1

Q4

Q3

Q2

Q1

Q4

Q3

Q2

Q1 Full year Full year

External order backlog
Order intake
External net sales
Transactions between segments
Operating profit (EBIT)
Amortization and write-down
Items affecting comparability (IAC)
Re-allocation of internal services
Adjusted EBITA
Adjusted EBITA margin, %

700
636
558
9
-6
-10
-75
−
80
14.1

640
520
419
6
32
-6
-1
−
39
9.1

516
450
520
11
67
-5
6
-0
66
12.3

640
575
563
9
90
-5
0
−
95
16.5

656
656
568
7
87
-5
-6
−
98
17.1

622
515
440
9
47
-5
−
−
52
11.5

526
491
464
5
55
-4
-3
−
61
13.0

554
513
527
7
75
-4
-6
−
85
15.9

570
582
554
8
74
-4
-8
−
85
15.2

561
500
456
9
24
-4
-19
−
46
9.9

2020

2019

516
2,196
2,091
35
291
-20
1
-0
310
14.6

526
2,087
2,002
31
226
-15
-36
278
13.7

2020

2019

Other and eliminations

2021

MSEK

Q2

Q1

Q4

Q3

Q2

Q1

Q4

Q3

Q2

Q1 Full year Full year

Order intake
Transactions between segments
Operating profit (EBIT)
Amortization and write-down
Items affecting comparability (IAC)
Re-allocation of internal services
Adjusted EBITA

-14
-10
-33
-7
0
−
-26

-8
-8
-41
-7
-12
−
-21

-11
-12
-50
-8
-10
0
-32

-10
-18
-31
-10
-0
−
-21

-17
-8
-36
-10
-7
−
-19

-10
-9
-32
-10
−
−
-22

-8
-9
-55
-16
-21
1
-17

-13
-9
-52
-24
-24
−
-3

-7
-9
-62
-24
-14
−
-23

-11
-11
-67
-23
-18
−
-25

12

2020

2019

-48
-48
-149
-37
-18
0
-94

-38
-38
-236
-88
-78
1
-69

Second quarter, 2021

Discontinued operation
2021

2020

2019

2020

2019

MSEK

Q2

Q1

Q4

Q3

Q2

Q1

Q4

Q3

Q2

Q1 Full year Full year

External order backlog
Order intake
External net sales
Operating profit (EBIT)
Amortization and write-down
Items affecting comparability (IAC)
Adjusted EBITA

−
−
−
−
−
−
−

−
−
−
−
−
−
−

−
−
-0
-2
−
−
-2

−
-1
13
-3
−
−
-3

−
1
3
-1
−
−
-1

−
−
-0
0
−
−
0

2
4
9
-65
0
-45
-20

8
-3
38
-341
3
-325
-19

43
3
87
-20
-0
-3
-17

−
11
42
-24
0
-0
-24

13

16
-6
-6

2
15
176
-450
3
-373
-80

Second quarter, 2021

Condensed income statement
Q2

Jan-JunLTM

Full year

MSEK

2021

2020

2021

2020

Jul-Jun

2020

Net sales
Cost of goods sold
Gross profit

1,822-1,190632

1,773-1,141632

3,434-2,2651,170

3,340-2,1991,140

7,109-4,7302,379

7,015-4,6652,350

Selling expenses
Administrative costs
Research and development costs
Other operating income and expenses
Operating profit

-217
-141
-40
-88
147

-220
-135
-43
-132
103

-408
-276
-77
-40
369

-430
-276
-91
-132
212

-796
-539
-172
-10
863

-818
-538
-186
-101
707

Financial income and expenses
Profit/Loss after financial items

-25
121

-50
53

-50
319

-80
132

-125
738

-156
552

Tax
Net income for the period from continuing operations

-37
84

-13
39

-75
244

-35
96

-159
579

-120
432

Net income from discontinued operations

-

-1

-

-1

-5

-6

Net income for the period

84

38

244

95

575

426

Attributable to Parent Company shareholders
Attributable to non-controlling interests

83

37

243

94

569

420

1

1

1

1

6

6

Average number of outstanding shares before dilution*
Average number of outstanding shares after dilution*

182,016,452 181,745,802

181,968,367 181,745,802

181,655,871 181,545,456

182,798,778 181,745,802

182,701,021 181,745,802

182,257,343 181,557,708

Earnings per share for net income for the period from continuing
operations attributable to the ordinary equity holders of thecompany:
Earnings per share before dilution, SEK
Earnings per share after dilution, SEK

0.46
0.45

0.21
0.21

1.33
1.33

0.53
0.53

3.16
3.15

2.35
2.35

Earnings per share for net income for the period attributable tothe ordinary equity holders of the company:
Earnings per share before dilution, SEK
Earnings per share after dilution, SEK

0.46
0.45

0.20
0.20

1.33
1.33

0.52
0.52

3.13
3.12

2.32
2.32

Other comprehensive income
Other comprehensive income that may be reclassified to profit or loss
in subsequent periods:
Exchange-rate differences on translation of foreign operations
Other comprehensive income not to be reclassified to profit or loss insubsequent periods:
incl. payroll tax
Income tax effect not to be reclassified to profit or loss
Other comprehensive income, net after tax

-62

-226

99

-16

-210

-325

8
-1
-55

-4
0
-230

44
-9
134

11
-3
-8

26
-5
-189

-7
1
-331

Total comprehensive income for the period
Attributable to Parent Company shareholders
Attributable to non-controlling interests

29
28
1

-192
-192
-

378
377
0

87
87
-

386
381
5

95
91
4

*Excluding shares held in own custody.

14

Second quarter, 2021

Condensed balance sheet
MSEK

2021-06-30

2020-06-30

2020-12-31

4,063
1,457
238
469
164
60
19
263
6,733

4,366
1,471
239
545
153
45
18
251
7,088

3,952
1,356
209
467
161
41
19
246
6,451

Raw materials and consumables
Products in process
Finished products and goods for resale
Projects in progress
Advances to suppliers
Accounts receivable
Prepaid expenses and accrued income
Derivative instruments
Current tax assets
Other receivables
Cash and cash equivalents
Total current assets

435
165
284
13
9
1,028
473
0
39
64
680
3,189

386
143
300
8
24
1,021
387
0
40
99
827
3,234

350
118
215
3
5
935
376
−
55
96
970
3,123

TOTAL ASSETS

9,922

10,323

9,574

ASSETSNON-CURRENT ASSETS
Goodwill
Patents, licenses, brands, and similar rights
Buildings and land
Plant and machinery
Equipment, tools, fixtures and fittings
Construction in progress
Financial assets
Deferred tax assets
Total non-current assets
CURRENT ASSETS

15

Second quarter, 2021

Condensed balance sheet
MSEK

2021-06-30

2020-06-30

2020-12-31

Shareholders' equity

4,029

3,715

3,746

Non-controlling interests
Total equity

4
4,034

0
3,715

5
3,751

2,532
266
47
139
381
3,365

3,323
279
38
138
406
4,184

2,690
299
33
132
371
3,525

Interest-bearing liabilities
Advances from customers
Accounts payable
Accrued expenses and deferred income
Derivative instruments
Current tax liabilities
Other liabilities
Provisions for pensions and similar commitments
Other provisions
Total current liabilities

97
623
662
767
−
40
93
9
232
2,523

117
536
550
745
1
37
144
9
283
2,423

96
509
529
742
2
52
111
10
248
2,299

TOTAL EQUITY AND LIABILITIES

9,922

10,3239,574

2021-06-30

2020-06-30

2020-12-31

Opening balance
Total comprehensive income for the period
Exercised share options
New share issue
Change in non-controlling interest
Put/call option related to non controlling interests
Dividends paid
Repurchase of shares
Share option plan inc deferred tax
Closing balance

3,751
378
32
−
−
-2
-129
−
4
4,034

3,627
87
−
−
0
-2
−
−
2
3,715

3,627
95
−
61
0
-4
−
-43
14
3,751

Total shareholders´equity attributable to:
The parent company's shareholders
Non-controlling interests

4,029
4

3,715
0

3,746
5

EQUITY AND LIABILITIESEQUITYNON-CURRENT LIABILITIESInterest-bearing liabilities
Provisions for pensions and similar commitments
Other provisions
Other liabilities
Deferred tax liabilities
Total non-current liabilities
CURRENT LIABILITIESCONDENSED STATEMENT OF CHANGES IN EQUITY
MSEK

16

N

Second quarter, 2021

Condensed cash flow statement
Q2
MSEK

Jan-JunFull year

LTM

2021

2020

2021

2020

Jul-Jun

2020

147

102

369

211

859

701

OPERATING ACTIVITIESOperating profit
Reversal of non-cash items
Depreciation, amortization and impairments
Other profit/loss items not affecting liquidity
Change in provisions
Provisions
Cash flow before interest and tax

74
8

73
6

143
2

151
2

301
20

308
20

-2
227

82
263

-8
506

22
386

-31
1,149

-1
1,029

Paid financial items

-50

-52

-70

-80

-141

-151

Taxes paid
Cash flow from operating activites beforechanges in working capital

-58

-13

-91

-25

-168

-102

119

197

345

281

840

776

Cash flow from changes in working capital

39

85

-99

28

56

183

Cash flow from operating activities

159

282

247

309

896

959

Business acquisitions
Sale of tangible fixed assets
Sale of intangible fixed assets
Investment in tangible assets
Investment in intangible assets
Cash flow from investing activities

0
-36
-67
-102

1
0
-34
-24
-56

1
-58
-103
-160

-7
1
-62
-39
-106

-2
14
2
-111
-167
-263

-9
14
2
-114
-103
-209

FINANCING ACTIVITIESNew share issue
Exercised share options
Loan raised
Amortization of loans
Repayment of lease liabilities
Repurchase of shares
Dividends paid
Cash flow from financing activities

32
574
-742
-24
-129
-289

29
-280
-29
0
-280

32
598
-841
-50
-129
-391

321
-354
-55
0
-89

61
32
605
-1,185
-107
-43
-129
-765

61
329
-698
-112
-43
-463

Cash flow for the period

-233

-53

-304

115

-132

287

Cash and cash equivalents at period start
Exchange-rate differences in cash and cash equivalents
Cash and cash equivalents at period end

916
-3
680

900
-20
827

970
14
680

722
-10
827

826
-14
680

722
-38
970

INVESTING ACTIVITIESOperating profit in prior period includes the discontinued operation. Isolated cash flow from the discontinued operations is disclosed in a separate note, seepage 22.

17

Second quarter, 2021

Parent company
CONDENSED INCOME STATEMENT
Q2
MSEK

Jan-JunLTM

Full year

2021

2020

2021

2020

Jul-Jun

2020

Net sales
Gross profit/loss
Administrative costs
Other operating expenses
Profit/Loss before interest and tax (EBIT)

−
−
-4
0
-4

−
−
-3
-3
-6

−
−
-4
-1
-6

−
−
-14
-3
-17

−
−
-12
-3
-16

−
−
-22
-5
-27

Financial income and expenses
Profit/Loss after financial items

-0

-0

0

0

-0

-0

-4

-6

-6

-17

-16

-28

Group contributions

−

−

−

−

23

23

Profit/Loss before tax

-4

-6

-6

-17

7

-5

Tax

-0

−

−

−

2

2

Net income for the period

-4

-6

-6

-17

9

-3

CONDENSED STATEMENT OF COMPREHENSIVE INCOME
Q2
MSEK
Profit/Loss for the period
Other comprehensive income, net after tax
Comprehensive income for the period

18

Jan-JunLTM

Full year

2021

2020

2021

2020

Jul-Jun

2020

-4
−
-4

-6
−
-6

-6
−
-6

-17
−
-17

9
−
9

-3
−
-3

Second quarter, 2021

Parent company
CONDENSED BALANCE SHEET
MSEK

2021-06-30

2020-06-30

2020-12-31

4,103
4
4,108

4,093
0
4,093

4,099
4
4,104

0
1
1
33
2
37

−
1
0
47
13
61

−
0
1
27
62
90

4,144

4,154

4,194

ASSETSNON-CURRENT ASSETS
Participations in subsidiaries
Other financial assets
Total non-current assets
CURRENT ASSETS
Other current receivables
Prepaid expenses and accrued income
Current tax assets
Receivables from subsidiaries
Cash and cash equivalents
Total current assets
TOTAL ASSETS

MSEK

2021-06-30

2020-06-30

2020-12-31

6
4,135
-61
-6
4,074

6
4,074
67
-17
4,129

6
4,135
33
-3
4,171

2
2

0
0

1
1

7
16
43
3
−
68

4
14
0
3
3
25

1
21
−
−
−
22

4,144

4,154

4,194

EQUITY AND LIABILITIESEQUITY
Share capital
Share premium reserve
Profit brought forward
Income for the period
Total equity
NON-CURRENT LIABILITIESProvisions for pensions and similar commitments
Total non-current liabilities
CURRENT LIABILITIES
Accounts payable
Accrued expenses and deferred income
Liabilities to subsidiaries
Other liabilities
Other provisions
Total current liabilities
TOTAL EQUITY AND LIABILITIES

19

Second quarter, 2021

Other disclosures
ACCOUNTING POLICIESThis report has been prepared, with regards to the Group, in accordancewith IAS 34 Interim Financial Reporting, recommendation RFR 1 of theSwedish Financial Reporting Board and the Swedish Annual Accounts
Act and, with regards to the Parent Company, in accordance withrecommendation RFR 2 of the Swedish Financial Reporting Board andthe Swedish Annual Accounts Act. The accounting principles appliedcorrespond to those presented in the Annual- and Sustainability report2020 (Note 1). As from the first quarter 2021, the cash flow statement
has been changed in regards to interest paid on leased liabilities (priorperiods restated). Previously the item "Repayment of leasing liabilities"
included paid interest. The correction has resulted in that “Cash flowfrom operating activities” has decreased and “Financing operations” areimproved compared with previous reporting, impacting second quarterlast year with MSEK 4.

DEFINITION OF KEY FINANCIAL
INDICATORSThe Group presents certain financial metrics in the Interim report thatare not defined in accordance with IFRS. The Group is of the opinion
that these metrics provide valuable complementary information, in thatthey enable an evaluation of the Group’s performance. The financial
metrics are calculated in accordance with the definitions presented on
page 125 of the Annual- and Sustainability report 2020.

TRANSACTIONSWITH RELATED PARTIESAt the annual general meeting in May 2021 it was resolved in accordance with the Board’s proposal on the implementation of a performancebased long-term incentive programme (“LTIP 2021” or the “Programme”). Previous years long-term incentive programs have beenshare based, (stock options), however the LTIP 2021 is a cash based
program vesting over a three-year period. The participants are expected
to invest the net payout in Munters shares until reaching a defined levelof investment. The Board of Directors nominates the CEO and Munters
Group Management, and a total of 62 additional participants will be
nominated by the respective management member. Each group will
have max opportunity based on the participant’s percentage of the current (2021) gross annual base salary.

ENVIRONMENTAL IMPACT
AND ENVIRONMENTAL POLICY
Munters’ operations affect the external environment through air and water emissions, the handling of chemicals and waste, transport of input
goods and finished products to and from Munters factories. Munters iscommitted to constant vigilance regarding the environmental impact of
its operations. Munters is committed to complying with all laws and tocontinuously promoting improvements in all Environment, Health &Safety (EHS) aspects, wherever Munters conducts business. Muntersconstantly seeks opportunities to reduce risk and to create a safer,
healthier, more diverse and more environmentally friendly workplace forour employees, customers, communities, and the overall environment.

20

Munters’ manufacturing facilities all over the world are committed toworking according to an EHS Management Program. The purpose of the
EHS Program is to ensure regulatory compliance, actively prevent injuries, and reduce the impact that our business has on the environment.

RISKS AND UNCERTAINTIESThe Group’s significant risks and uncertainties can be divided into four
categories; strategic, operational, financial and regulatory risks. In thesecategories, there are both risks due to political and macroeconomic
trends and specific risks directly linked to the business carried out by theGroup. A risk assessment is carried out on an annual basis and the purpose is to identify and address the most important risks.
Munters’ products are used in complex customer processes. Quality andcontract obligations are critical and could result in claims for damages.
The Group depends to some extent on key customers and key personnel. Considering that Munters is a company with geographically widespread operations and many small organizational units, there is a risk offailure to comply with relevant regulations in the business ethics area,
e.g. anti-bribery rules.
Financial risks mainly consist of currency, interest and financing risks.
Munters works actively with insurance solutions, and group-wide insurances are governed by central guidelines. This includes for example
coverage for general liability and product liability, property, business interruption, transportation, the liability of Board members and the CEOand employment practices liabilities.
During 2021 the Covid-19 pandemic continued to have an impact on ourbusiness, albeit in a mixed way. In some areas it led to increased demand at the same time as constraints in the supply chain increased
throughout the second quarter leading to longer lead times and sourcing
related production disturbances. Costs continued to increase for raw
material and freights. We implemented consecutive price increases in
2021. These will come into effect over the coming quarters with the majority effect next year due to extended lead times. We expect constraints
in the supply chain to remain throughout the year.
A more detailed description of the Group’s risks and how they are managed can be found in the Annual- and Sustainability report 2020 on
pages 50-55.

ALLOCATION OF NET SALES
The majority of customer contracts within Munters business segments
AirTech and FoodTech fulfill the requirements to recognize net sales ata point in time, however there are a number of customer contracts within
the segments that requires to recognize net sales over time, especiallyin AirTech sub-segment Data Centers, which is reflected in the below
matrix. In addition to unit/equipment sales, Munters provides different
kinds of services to customers such as installation, commissioning,
startup and maintenance. Net sales from services are recognized overtime as these services are performed. The services transferred overtime in the matrix below is not equivalent to the net sales from Services
mentioned on the business segment pages earlier in this interim report.
This is due to the fact that part of the net sales within Services are recognized at a point in time, such as spare parts. Net sales from the discontinued operation is all recognized over time.

Second quarter, 2021

Q2 2021MSEK
Goods transferred at a point in time
Goods transferred over time
Services transferred over time
Total
whereof related to the discontinued operation
Total net sales from continuing operations

AirTech
822
329
113
1,264
−
1,264

FoodTech
487
32
39
558
−
558

Jan-Jun 2021
Total
1,309
361
153
1,822
−
1,822

AirTech
1,602
653
202
2,457
−
2,457

Q2 2020
SEKm
Goods transferred at a point in time
Goods transferred over time
Services transferred over time
Total
whereof related to the discontinued operation
Total net sales from continuing operations

AirTech
742
388
78
1,209
3
1,205

FoodTech
522
15
31
569
−
569

FoodTech
859
46
72
977
−
977

Total
2,461
699
274
3,434
−
3,434

Jan-Jun 2020
Total
1,264
403
110
1,777
3
1,774

AirTech
1,513
674
148
2,335
3
2,332

FoodTech
904
35
68
1,008
−
1,008

FoodTech
2,418
709
216
3,343
3
3,340

FAIR VALUE OF FINANCIAL
INSTRUMENTS
MSEK
Opening balance
Payments
Discounting
Exchange-rate differences
for the period
Closing balance

2021-06-30 2020-06-30 2020-12-31
121

142

142

−
2

-9
2

-9
4

5
127

0
136

-16
121

The Group’s put/call acquisition option, recognized at fair value in thestatement of financial position, are measured according to IFRS 9 andare categorized in level 3 in the fair value hierarchy. The opening balance for the period relates to the put/call option from the acquisition of
MTech Systems in 2017, which is based on EBITDA for the 12 months
prior to execution and matures in January 2023. The change in the period relates to a discounting effect and currency translations on theput/call option.

The Group’s derivatives, recognized at fair value in the statement of financial position, are measured according to IFRS 9 and are categorizedin level 2 in the fair value hierarchy. The derivatives amounted to MSEK
0 (0) in financial assets and to MSEK 0 (1) in financial liabilities.

Munters deems that the interest rate on interest-bearing liabilities are inline with market terms at June 30, 2021, and the fair value at the end of
the reporting period therefore in all material aspects corresponds to thecarrying amount.

DISCONTINUED OPERATIONS

tions with the unions. The production ceased in 2019 but minor installation services remained at customer sites during 2020. The table below
shows the income statement for the discontinued operation as well as
the cash flow from operating activities.

On September 9, 2019 Munters decided to close its European Data
Center factory in Dison, Belgium, following the finalization of negotia-

21

Second quarter, 2021

Q2
MSEK

Jan-JunLTM

Full year

2021

2020

2021

2020

Jul-Jun

2020

Net sales
Cost of goods sold
Gross profit

−
−
−

3
-5
-2

−
−
−

3
-5
-1

13
-6
7

16
-11
6

Selling expenses
Administrative costs
Research and development costs
Other operating income and expenses
Operating profit

−
−
−
−
−

0
0
0
-0
-1

−
−
−
−
−

0
0
0
−
-1

-8
-2
0
-2
-5

-8
-2
0
-2
-6

Financial income and expenses
Profit/Loss after financial items

−
−

-0
-1

−
−

-1
-1

0
-5

-0
-6

Tax
Net income for the period from discontinued operations

−
−

−
-1

−
−

−
-1

0
-5

0
-6

Cash flow from operating activities

-19

62

20

4

-133

-149

RECONCILIATION OF ALTERNATIVEPERFORMANCE MEASURES

connected with a previous customer claim that was finally settled in February 2021, and received an insurance compensation linked to an exchange of specific components at a customer site within the European
Data Center business (where costs for the exchange amounted to
MSEK 116, reported during the third quarter of 2019). In addition to thisMunters had minor Covid-19 related expenses and government grantsthat were adjusted for comparability.

Below is a reconciliation of Munters adjusted performance measuresfrom items affecting comparability. In the second quarter of 2021, these
items mainly originated from the activities connected with the strategy
implementation within business area FoodTech, communicated througha press release in May, 2021, as well as from implementation activities
related to the refined strategy within AirTech communicated during lastyear.

During the second quarter as well as the first six months last year
Munters mainly incurred IACs related to the implementation of the refined strategy within AirTech.

For the first six months, in addition to the above, Munters incurred costs
related to a legal case outside the ordinary business operation

The reconciliation below does not include the discontinued operation.

Q2
MSEK
Adjusted EBITDA
Amortizations and write-downs of tangible assets
Adjusted EBITA
Amortizations and write-downs of intangible assets
Adjusted operating profit (EBIT)
Restructuring activities
Gains/losses from sale of fixed assets
Legal cases outside the ordinary business operation
Proceeds insurance reimbursements from legal cases
Received government grants/government assistanceCorona related expenses
Earned refund of sales tax in Brazil
Other
Operating profit (EBIT)

22

Jan-JunFull year

2021-06-30

2020-06-30

2021-06-30

2020-06-30

LTM

Jan-Dec

311
-53
259
-17
242
-94
0
0
0
1
-1
0
-1
147

313
-53
260
-20
240
-136
0
-6
0
9
-5
0
0
103

561
-105
457
-34
423
-106
0
-7
61
1
-2
0
-1
369

500
-110
390
-40
350
-136
0
-6
0
9
-5
0
0
212

1,187
-215
972
-81
891
-94
6
-15
61
12
-10
13
-1
863

1,126
-221
906
-87
818
-124
6
-14
0
20
-12
13
0
707

Second quarter, 2021

RECONCILIATION OF NET DEBT
AND LEVERAGE
The reconciliation of net debt and leverage below includes the discontinued operation.
MSEK

2021-06-30

2020-06-30

2020-12-31

CURRENT ASSETS
Cash and cash equivalents

-680

-827

-970

NON-CURRENT LIABILITIESInterest-bearing liabilities, excluding leases
Interest-bearing lease liabilities
Provisions for pensions

2,258
274
250

3,037
286
263

2,440
250
285

CURRENT LIABILITIESInterest-bearing liabilities, excluding leases
Interest-bearing lease liabilities
Accrued expenses
Provisions for pensions

5
93
4
6

26
92
12
6

14
82
9
6

Total Net debt
Operating profit (EBIT)
Depreciations
Amortization and write-down
EBITDA
Items affecting comparability

2,209
859
-215
-86
1,160
-23

2,895
138
-275
-99
512
-563

2,116
701
-221
-87
1,010
-111

Adjusted EBITDA, LTM

1,183

1,075

1,121

1.9

2.7

1.9

Net debt/Adjusted EBITDA, LTM

23

Second quarter, 2021

The Board of Directors and the President and CEO certify that the Interim Report gives a true and fair overview of the Parent Company’s and Group’s
operations, their financial position and results of operations, and describes the significant risks and uncertainties facing the Parent Company and othercompanies in the Group.

Stockholm, July 16 2021

24

Magnus Lindquist
Chairman of the Board

Klas Forsström
President & CEOHåkan Buskhe
Board Member

Helen Fasth Gillstedt
Board Member

Per Hallius
Board Member

Lena Olving
Board Member

Kristian Sildeby
Board Member

Juan Vargues
Board Member

Anna Westerberg
Board Member

Simon Henriksson
Board Member,
employee representative

Robert Wahlgren
Board Member,
employee representativeSecond quarter, 2021

This report has not been subject to review by the company’s auditors.

INFORMATION AND REPORTING DATESContact person:

Ann-Sofi Jönsson, Vice President, Investor Relations and Enterprise Risk Management
Phone: + 46 (0)730 251 005
Email: ann-sofi.jonsson@munters.com
You are welcome to join a webcast or telephone conference on July 16, at 9:00, when the President and CEO, Klas Forsström, together with the Group Vice
President and CFO, Annette Kumlien will present the report.
Webcast:https://tv.streamfabriken.com/munters-q2-2021
Dial-in number for the telephone conference:
SE: +46 8 505 58375
UK: +44 3333009271
US: +16467224956
This interim report, presentation material and a link to the webcast will be available on https://www.munters.com/en/investor-relations/____________________________________________________________________________________________________________________________
Financial calendar:
October 22, 2021, Interim report January-September 2021
February 4, 2022, Full year report, January-December 2021____________________________________________________________________________________________________________________________
This information is information that Munters Group AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities
Market Act. The information was submitted for publication, through the agency of the contact person set out above, at 07.30 CET on July 16, 2021.
Munters Group AB, Corp. Reg. No. 556819-2321
About Munters Group
Munters is a global leader in energy efficient air treatment and climate solutions. Using innovative technologies, Munters creates the perfect climate forcustomers in a wide range of industries. Munters has been defining the future of air treatment since 1955. Today, around 3,500 employees carry out manufacturing and sales in more than 30 countries. Munters Group AB reported annual net sales of more than SEK 7 billion in 2020 and is listed on Nasdaq
Stockholm. For more information, please visit www.munters.com.
Every care has been taken in the translation of this interim report. In the event of discrepancies, the Swedish original will supersede the English
translation. The addition of the totals presented may result in minor rounding differences.

25