Glossary

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ADR

American Depository Receipts. One Husqvarna ADR is equivalent to two Husqvarna B-shares. The ADRs are traded on the US over-the-counter market.

Articulated steering system

Husqvarna's unique articulated steering system allows the rear pair of wheels to swing in underneath the machine. The result is superior manoeuvrability with a minimum turning radius at full lock.

Automower®

Automower® is the market's first robotic lawn mower. It is battery-driven, silent and features low energy consumption. It mows the lawn automatically and returns to the docking station when battery power drops to a predefined level. The robotic lawnmower is available in several versions including a Solar Hybrid and a professional version.

AutoTune

AutoTune technology uses a computer chip to control the flow of fuel to the engine. This enables automatic optimization of performance, which in turn reduces fuel consumption and emissions. The new chainsaw 576 XP AutoTune, which was launched in 2009 is a technological and environmental break through for professional chainsaws.

BioClip®

Mulching-feature where the grass is cut into small pieces that quickly decompose and return to the lawn as fertilizer. BioClip is suitable for frequently cut areas.

Capital employed

Total liabilities and equity less non-interest-bearing debt including deferred tax liabilities.

Capital expenditure

Property, plant and equipment and capitalization of product development and software.

DOW Jones Sustainability Index

Dow Jones Sustainability Indexes are global indexes used for evaluation of sustainable companies' world wide.

E-TECH

E-TECH engines are optimized for power, environmental features and handling. They combine high power and low weight with reduced exhaust emissions and user-friendly features.

E-TECH II

E-TECH II engines comprise our X-TORQ two-stroke engines and our four-stroke engines. They represent the latest development in low emission engine technology. The engine is used in chainsaws, clearing saws, trimmers and leaf blowers.

Earnings per share

Income for the period divided by the number of shares.

EBITDA

Earnings before interests, taxes, depreciation and amortization.

Enterprise Value (EV)

EV measures the enterprise value of the company and is a complement to market capitalization. EV is calculated as market capitalization plus net debt and minority interests.

Equity/assets ratio

Equity as a percentage of total assets.

EV/EBIT

EV/EBIT is a valuation measure that compares the enterprise value of the company to the company's operating income.

EV/Sales

EV/Sales is a valuation measure that compares the enterprise value of the company to the company's sales. The key ratio gives investors an indication of the cost of buying the company's sales.

Excluding acquisitions

Figures excluding acquisitions are reported in order to make the current period comparable with the corresponding period in the previous year. Adjustment is made for acquisitions with annual sales of SEK 100m or more.

FTSE4Good

A sustainability index that is managed jointly by the London Stock Exchange and the Financial Times. The companies included in the index are evaluated based on their performance within social responsibility and environmental responsibility.

GRI

The Global Reporting Initiative has developed the most world wide applied guidelines for sustainability reporting. The guidelines include principles and indicators for measuring economic, social and ecological/environmental performance.

Gross margin

Gross operating income as a percentage of net sales.

ILO's Declaration on Fundamental Principles and Rights at Work

ILO - International Labour Organization. The International Labour Organization is a United Nations agency, which establishes conventions on labor standards that are binding on member states when ratified. ILO's declaration aims to promote rights in working life when it comes to freedom of association and collective negotiation rights, as well as to prevent forced and compulsory labor, discrimination and the use of child labor.

Insider

Any person who through his position at or assignment for a company has knowledge of, or access to, valuable non-public information that could have an impact on the development of the company's share price. The insider should be registered at Finansinspektionen (Swedish Financial Supervisory Authority) and has a reporting duty of all personal trading in shares and other securities issued by the company. Examples of an insider include the Directors, the President, senior management, key employees, shareholders who own more than 10% in the company and closely related parties.

Interest coverage ratio

Income after financial items plus financial costs divided by financial costs.

ISO 14001

The standard published by the International Standards Organization, specifying the requirements of an environmental management system.

ISO 9001

The standard published by the International Standards Organization, specifying the requirements of a quality management system.

Liquid funds

Cash and cash equivalents, short term investments and fair value derivative assets.

Low-end products

Product that is simpler and has fewer features. Low-end products are sold primarily through mass-market channels and in the lower price segment.

LowVib

Effective anti-vibration dampeners absorb vibration, sparing the user's arms and hands. The feature is included in different models of chainsaws, clearingsaws and trimmers.

Market capitalization

Market capitalization is calculated as the share price multiplied with the total number of shares in the company.

Mass-market channel

Major retail chains such as Sears, Lowe´s, Walmart in the US and B&Q, Leroy Merlin, OBI and Bauhaus in Europe. The customers are primarily consumers. Almost half of Husqvarna's sales are through these mass-market channels.

Net assets

Total assets exclusive of liquid funds and interest-bearing financial receivables less operating liabilities, non-interest-bearing provisions and deferred tax liabilities.

Net debt

Total interest-bearing liabilities less liquid funds.

Net debt/equity ratio

Net debt in relation to total adjusted equity.

Net sales growth

Net sales as a percentage of the preceding period.

OECD's guidelines for multinational companies

OECD - Organization for Economic Co-operation and Development. The Guidelines aims to encourage the positive contributions multinational companies can make to economic, environmental and social development. The guidelines contain voluntary principles and norms for good corporate responsibility in a range of areas, including relations between labor market parties, human rights, environmental issues, information and communication, fair trading, taxation, science and technology.

Operating cash flow

Total cash flow from operations and investments, excluding acquisitions and divestment of operations.

Operating margin

Operating income as a percentage of net sales.

Operating working capital

Inventories and trade receivables less trade payables.

Outstanding shares

The company's shares which are not owned by the company and that are traded on the stock market.

P/E-ratio

Price/earnings ratio i.e. the share price divided by earnings per share. The ratio is used to estimate if the valuation of a share is high or low compared to the company's earnings.

Premium brands

Brands with strong positions primarily globally and/or in regional markets i.e. Husqvarna and Gardena. Premium brands may also have strong positions in local markets or within specific product categories. The Group's other premium brands include Jonsered, Zenoah, Klippo and Diamant Boart.

Premium products

Product with several features. Premium products are sold through dealers in the higher price segment and primarily to professional users or demanding consumers.

Record date

The date when the share register is reconciled. The registered shareholder on this date is entitled to receive dividend, participate at general meetings, and participate in a new or bonus share issue.

Registered by nominees

Shares which are registered in the share register in the name of the nominee instead of the owner's name.

Repurchased shares

Own shares that the company has repurchased from the stock market. Repurchases can only follow an authorization by the AGM. Husqvarna repurchases own B-shares in order to hedge the company's obligations pursuant to the existing long-term incentive programs and issued synthetic shares.

Return on capital employed

Operating income plus financial income as a percentage of average capital employed.

Return on equity

Income for the period as a percentage of average equity.

Rider

Ride-on lawnmower available in a range of versions for both consumers and professional users. The unique patented rear-wheel steering gives the Rider a superior manoeuvrability and at full steering lock, the uncut circle is only about 20 cm in diameter.

Servicing dealers

Independent dealers who also offer technical service. Husqvarna's products are sold through 25,000 dealers world wide. Almost half of Husqvarna's sales are through servicing dealers.

Tactical brands

These are consumer brands with a position in differing local markets. These brands are important but will not be expanded at the global level. Example of tactical brands are Poulan and WeadEater in North America, Partner in Europe and Scandinavia, and Flymo in the UK.

TrioBrake

Safety feature for chainsaws which allows the chain to brake either automatically by the inertia release mechanism or mechanically by your left or right hand.

Value creation

Operating income less the weighted average cost of capital (WACC) on average net assets: (Net sales - operating costs = operating income) - (WACC x average net assets).

Working capital

Current assets exclusive of liquid funds and interest-bearing financial receivables less operating liabilities and non-interest-bearing provisions.

X-TORQ®

Husqvarna's latest technology for two-stroke engines, which reduces fuel consumption by up to 20% and emissions by up to 60%. The engine technology increases torque over a wider rpm range, providing maximum cutting power. X-TORQ® is used in E-TECH II engines for chainsaws, clearing saws, trimmers and leaf blowers.

Yield

Annual yield on a security without considering any movements in market price. A share's direct yield is the dividend divided by the share price.

ZTH

Ride-on, handle-assisted lawnmower with zero-turn radius. The ZTH-technology with separate wheel motors for each driving wheel enables the machine to turn around its own axis.