annual and sustainability report 2020 - nobia

Annual and Sustainability Report 2020

Designing Kitchens for Life

Designing kitchens for lifeThe kitchen has gone from being a backstage room to becoming

the most important room in the home. This is where we gather family and friends. It’s where we start the day — and where we end it. At Nobia and our brands we develop well-designed, functional and emotionally

appealing kitchens that enable a sustainable lifestyle and reduce climate impact. We do this for our customers

today, and for generations to come.

Contents

Nobia 202004 Europe’s leading kitchen specialist06 202007 Five-year overview08 CEO’s comments10 How Nobia creates value

Business environment13 The European kitchen market 16 Trendsaffectingourkitchens

Strategy18 Strategyforprofitablegrowth22 Targetsandfulfilment

Sustainability25 Theyearinfigures26 Sustainability throughout the

value chain28 New sustainability strategy

Operations38 Our regions40 Nordic region41 UK region42 Central Europe region

Board of Directors’ Report43 Board of Directors’ Report50 Risks and risk management

Financial statements60 Consolidated income statement,

consolidated statement of comprehensive income and comments

63 Consolidated balance sheet and comments

65 Change in consolidated shareholders’ equity

66 Consolidatedcash-flowstatement and comments

67 Parent Company income statement, balancesheet,cash-flowstatementand change in shareholders’ equity

69 Notes98 Reconciliation of alternative

performance measures99 Board of Directors’ assurance100 Audit report

Corporate governance and the Nobia share102 Corporate Governance110 Board of Directors112 Group management114 The Nobia share and shareholders116 Five-year overview117 Definitions–Performancemeasures118 Sustainability122 2021 Annual General Meeting

TheauditedAnnualReportandconsolidatedfinancialstate-mentscanbefoundonpages43–99.ThestatutoryCorpo-rateGovernanceReportcanbefoundonpages102–109 and the statutory Sustainability Report can be found onpages24–36,50-58and118-121.

Nobia Annual and Sustainability Report 2020 3

Europe’s leading kitchen specialist

At Nobia, we design kitchens for life. To us, that means developing well-designed, functional and emotionally con-ceptualised kitchens that speak to the hearts and minds of our customers. Kitchens that enable a sustainable life-style and reduced climate impact. We are fifteen strong local brands that benefit from advantages of working together. With operations that incorporate the entire value chain from design to installation, we are driven by a shared ambition to lead the way in design and sustainability in our industry. Together, we form Europe’s leading kitchen specialist.

Nordic regionDenmark, Sweden, Norway, Finland23 own stores168franchisestoresApproximately 400 retail stores6productionfacilitiesApproximately 2,400 employees

UK region202 own storesApproximately450retailstores5productionfacilitiesApproximately2,800employees

Central Europe regionNetherlands, Austria>500retailstores3 production facilitiesApproximately600employees

Net sales per region, %

Nordic,53

UK, 37

Central Europe, 10

Customer segment, %

Project, 44

Retail, 37

Trade,19

Gross profit per region, %

Nordic,55

UK, 34

Central Europe, 10

Sales per product, %

Kitchen furnishings,64

Other products, 30

Installation services,6

Employees per region, %

Nordic, 42

UK, 47

Central Europe, 11

Sales channels, %Kitchen specialists, own stores and franchises,61Direct project sales, 13Builders’ merchants/ DIYchains,19Other retailers, 7

4 Nobia Annual and Sustainability Report 2020

Strategy for profitable growthNobia’sstrategyisbuiltonthreestrategicpriorities:Growthacceleration,StructuralefficiencyandPeopleengagement,andtheambitiontobetheindustryleaderindesignandsustainability.InadditiontotheGroup’sfinancialtargets,theoverallgoalsaretobethecustomers’firstchoiceeverywhereweoperateandtobearesponsiblecompanythatisattractivetoemployeesandinvestors.ByleveragingtheGroup’seconomiesofscale,westrengthenourlocalcompetitiveness.

Strong brandsStrong brands Nobia comprises about 15 well-known and strong local brands in the mid- and premium segments.

13/14 100% 63%production facilities have certified environmental

management

renewable electricity in production and

own stores

of all wood waste goes to manufacturing

new products


2020

The pandemic had a major impactThe coronavirus pandemic that broke out at the beginning oftheyearhadamajorimpactontheglobaleconomy.Operationswereperiodicallyaffectedbyvariousnationalrestrictionsandclosurestoreducethespreadofinfection.Despite the challenges, the Nordic and Central Europe regions delivered higher earnings year-on-year while the UK,whichwasmostseverelyaffectedbyclosuresandrestrictions,reportedlowerearnings.

Decisions on new plant for structural efficiencyNobia continues preparations for investment in a highly automatedproductionplant.TheBoardofDirectorshasdecidedtobuildtheplantinJönköping,Sweden.Theplantwill be highly automated and digitised, with a high degree of industry-leading environmental and sustainability per-formanceandisexpectedtobeinfulloperationin2024.Investments in production equipment will amount to approx-imatelySEK2billion.

New organisation for increased regional responsibilityIn line with Nobia’s strategy for organic growth, structural efficiency,peopleengagementandbecomingaleaderinsustainability and design, the Group implemented organ-isationalchanges.Theneworganisationwillenablestron-ger regional accountability, faster decision making and improved speed in execution as well as the realisation of advantagesoflarge-scaleproduction.TheNordic,UKandCentral Europe regions are responsible for sales, marketing and customer service as well as a Group-wide Product Sup-plyfunctionthatisresponsibleforthesupplychain.

Higher demand from consumersMore time was spent at home during the coronavirus pan-demic.Thisresultedingreaterinterestinhomerenovationsand growing demand for new kitchens from consumer cus-tomers,particularlyinthesecondhalfoftheyear.Nobiasuccessfully launched several new products during the year, including Nordic Spirit from HTH and a collection of colourfulkitchensfromMarbodalandSigdal.

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The year in brief

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2020201920182017201620202019201820172016

2020120192018120172016

20202019201820172016

202020191201820172016

202012019201820172016

1)EffectofIFRS16asof2019. 1)Excludingitemsaffectingcomparability.

1)TheBoard’sproposal.

Five-year overview

Completefive-yearoverview,refertopage116.

Net sales, SEK m Operating cash flow, SEK m

Operating profit, SEK m and operating margin, %

Share of renewable electricity in production and own stores, %

Return on operating capital, %

Dividend, SEK

15,000

10,000

5,000

0

2,100

1,400

700

0

1,500

1,000

500

0

100

75

50

25

0

15

10

5

0

45

30

15

0

9

6

3

0

12,741 1,808

6

21

100

581


The year in brief

Leadership in design and sustainability

We have never experienced a year like 2020. In so many ways we faced new and strange business situations. The pandemic impacted the entire value chain from suppliers to customers and brought health and safety to a new level. Overnight, we went from a situation with healthy demand and a strong order book to a situation with closed stores and factories. I am impressed with how rapidly and well the entire organization adapted to a new reality.

Focus on cashflowAfter the initial shock in second quarter, it was clear that the kitchenindustrywasnotaffectedasseverelyassomeotherindustries.Severalnationalmeasuresandrestrictions,pre-dominantly in the UK and Austria, forced us to temporarily close parts of our store network and some factories, but, the underlyingdemandturnedouttobestrong.Mostconstructionsitesremainedopenandconsumerdemandincreased.How-ever, needless to say the unprecedented situation and almost half the company “temporarily closed” in the second quarter negativelyimpactedthefinancialperformanceoftheGroup.

Tofendofftheconsequencesofthepandemic,weimme-diately took action to protect our employees’ health and safety, introduced a major temporary furlough program, withdrew the dividend proposal, secured our supplier base and launched tools to serve our customers as much as pos-siblethroughdigitalsolutions.Long-termprojectshadtobere-prioritized,withsales,deliveriesandcashflowbecomingourmainfocus.Wherepossibleandinasafemanner:sell,sell,sellanddeliver,deliver,deliver-tosafeguardcashflowwastheinternalmantra.

I am incredibly proud over all employees and how the criticalsituationsweremanaged.Whetherourpeopleweregoing to work in a factory, interacting with customers, work-inginanofficeorfromhomeorbeingfurloughed.Everybodycontributed.Allinallwemadeitthroughtheinitialseveresitu-ationbyworkingasateam.

Stronger conditions for realizing long-term growth Despite the severe and ever-changing business condi-tionswealsomanagedtokeepoureyesonthehorizon.Weworkedonourlong-termstrategythatoutlineshowwewilldrivegrowth,structuralefficiencyandpeopleengage-mentwithsustainabilityanddesignatthecentre.Wecallit “Tomorrow Together” and it is an ambitious, and in some

waystransformationalagendatodrive.Oneofthehigh-lights was that we took the decision to build the most mod-ern and highly automated kitchen factory in the Nordics, tobeinoperation2024.Itwillsupportandenablemanygrowthopportunities,drivestructuralefficienciesaswellasmassivecomplexityreduction.Onthebackofthislargeinvestment we reached an agreement with the trade union organizations to secure a good future for our employees in Tidaholm.Wealsosecuredalongterm-debtfinancingofSEK5billion.

To be better at executing on the many initiatives in our strategy we decided on and implemented a new organiza-tionalstructurebySeptember.Webuilttheorganizationonthree commercial regions supported by a product supply unit.WedelegatedmanyGroupfunctionsandconsolidatedmanylocalfunctionstotheRegions.Thistoenablebetteraccountability for the overall business and better and faster short-andlong-termdecisionmaking.Wecanbuildstron-ger propositions to the customers, while we continue to drive importantsynergiesandcomplexityreduction.

Sustainabilityhasneverbeenmoreimportant.Thepan-demic has made stakeholders even more aware and investors andcustomersarerequiringmorefromus.Wearewellposi-tionedforthisandhavetheambitionstoexcelinthisarea.Nobia is a signatory of the UN Global Compact and supports the ten principles on human rights, labour, environment, and anti-corruption.Weareworkingactivelytointegratetheseprinciplesthroughoutouroperations.Afterhavingachievedall the objectives in our previous sustainability strategy, con-cluded 2020, we adopted a new sustainability strategy with objectivesfor2021to2026.Itlinksourcoreoperationstoourcommitment within the Global Compact and our ambitions tocontributetotheUNSustainableDevelopmentGoals.Iampleasedandproudthatwewerethefirstkitchenspecialisttohave our new science-based climate targets approved by the


CEO’s comments

Science-Based Targets initiative, in which we intend to help reduceouremissionsinlinewiththeParisAgreement.

In the UK, we continued to invest in even stronger propo-sitionsfortradecustomers.MostofourUKstoreshavenowbeenadaptedinaccordancewiththetradesperson’sneeds.For us these are a priority target customer since it is relatively stable and repetitive business, and we see opportunities to captureadditionalmarketsharesinthissegment.Inordertoimprovestructuralefficiencyandfurtherimprovecustomerinteractions we integrated the Rixonway project business withMagnet’s.

One important learning during the pandemic was that there is a high level of digital maturity among many custom-ers.Evenforarelativelycomplexprocesssuchasakitchenpurchase,whereupto300decisionsneedtobemade.Ouracceleratedeffortsindigitalkitchendesignmeetingsexceeded expectations, and we will continue to develop this furthergoingforward.

High margins in Nordic and Central Europe Nobia’sorganicnetsalesdecreased7percent(0)toSEK12.7bil-lion,primarilyasaresultofthe19percentdropintheUKforthefullyear.NordicandCentralEuropegrew,by3percentand2percentrespectively.Denmarkdeservestobementionedspe-cificallywithstronggrowthandincreasedmarketshares.InCentral Europe, Bribus in the Netherlands showed continued positive performance, and in Austria the market staged a strong recovery in the second half of the year built on pent up demand fromthelockdown.Acrossallmarkets,consumersalesbene-fitedfromagrowingdemandinhomerenovationsduringthepandemic.

OperatingprofitexcludingitemsaffectingcomparabilitydecreasedtoSEK581m(1,132),theNordicswasonaparwithpre-vious year, with continued high margins and Central Europe’s performancewasverystrong.However,despitecost-reduction

measuresandfurloughsupport,itwasnotpossibletofullyoff-setthelockdowneffectoflowervolumesintheUK.

Strong cash flow and balance sheet OperatingcashflowfortheyearimprovedtoSEK1,808m(1,179)despitelowerearnings.Thisisprimarilyduetoimproved working capital and investments that were tem-porarilylower.Thealreadylowdebt/equityratiodecreasedfurtherto5percent.(31).Inthelightofthestrongfinancialposition, the Board of Directors proposes a dividend of SEK 2persharefor2020.

Continued uncertainty in 2021 Weenter2021inastrongerpositionthanIwouldhaveantic-ipatedbackinApril.WiththatsaidIstillseesomecontinueduncertainty when it comes to restrictions that may impact themarketandbusinessin2021.Butagain,theunderlyingdemand for our products is strong and the consumer inter-estforhomerenovationswillremain.Wewillneedtocon-tinue to balance our resources for the short-term situations andourlong-termambitions.

Iamconfidentandexcitedaboutourplanandtheactiv-itieswehaveoutlinedintheTomorrowTogetherstrategy.There is continued underlying demand for our great prod-ucts and we have the organization and people to carry out thetasks.

I would like to express my sincere gratitude to all our employees, customers, suppliers, shareholders and other stakeholders.2020hasbeenanenormouslychallengingyear, but we have a very exciting future ahead of us!

Jon SintornPresident and CEO


Resources we are developingManufactured capital• 14 production facilities• 225ownstores• SEK 200m of investments intangiblefixedassets

Business relationships• 168franchisestores• Approximately 1,400 retail stores• Approximately600suppliersofdirect

materials• Customers: consumers, tradesmen,

construction projects

Intangible resources• A portfolio of strong kitchen brands• SEK108mofinvestments

in intangible assets• Systems and master data for products

and supplier management • Operating systems and programs for

employee development

Human capital• Approximately5,900employees

Financial resources• SEK6,421moperatingcapital• SEK1,808moperatingcashflow

Natural resources• 374,000 m3 timber and wood products• 170GWhenergy

Our operationsFocus on kitchens Nobia’s business model is manufacturing and sell-ing primarily kitchens to consumers and compa-nies under its own kitchen brands and under private labels.Operationscovertheentirevaluechainfromproduct development and sourcing to sales and dis-tribution, as well as installation services in certain markets.

Wesellprimarilycompletekitchensolutions:everything a kitchen needs - cabinets, drawers, fronts,panels,bases,cabinetfixtures,worktops,sinks, mixer taps, appliances, kitchen fans, han-dlesetc.Thefurnishingsareprimarilymanufacturedfromwoodproductsinourownfacilities.Salestakeplace via own stores, franchise stores and retail-ers.Inaddition,wehavedirectsalestolargeprofes-sional customers such as residential and property developers.

Nobia creates value by delivering complete, attractive and sustainable kitchen solutions, with excellent function and design, based on our custom-ers’individualneeds.Readmoreaboutourstrategyonpages18–23.

How Nobia creates value

Nobia’s operations cover the entire value chain, from the development and manufacturing of kitchen products to sales and distribution of complete kitchen solutions to end customers. We create value for our customers and other stakeholders, and strive to develop sustainable operations.

AMBITION: Sustainability

and Design Leader-

ship Structural efficiency

People engagement

Growth acceleration



Value created, 2020 Per stakeholder group Customers• Delivery of nearly a half million new kitchens

to consumers, builders and property developers• New kitchen concepts and products that make

consumers’ daily lives easier• More than 17 million visits (up 43%) to our websites, where over120,000consultations(up125%)werebooked

Community and suppliers• SEK 100m in income tax• Approximately6,000jobs,primarilyinsmallertowns• Innovative solutions for a more sustainable life in the

kitchen• 100% renewable electricity in production and own

stores• Recyclingrateof63%oftheGroup’swoodwaste• Approximately 300 suppliers in the supplier audit pro-

gramme

Employees• Focus on organisational health • Performance reviews • Group-wide leadership programmes

Owners and lenders• Dividend SEK 0m1

• InterestexpenseSEK19m

Long-term effects on people, society and the planetThe value of our sustainability strategyImplementing Nobia’s new sustainability strategy means our operations promote: • Our customers living more sustainably in the kitchen,

through our innovative kitchen solutions • LimitingourCO2 emissions related to our opera-

tions in line with the Paris Agreement, through our sci-ence-based climate target

• Sustainable forestry being retained, through our increaseduseofcertifiedwood

• Smaller amounts of original raw materials being used, through increased circularity of products and materials

Read more about our sustainability strategy on pages 24–36.

Total distributed value SEK 3,476m

Interesttolenders,SEK19m

State and municipal taxes, SEK 100m

Salaries, social security contribu-tionsandpensions,SEK3,357m

Dividends to shareholders, SEK 0m

1)Nodividendwaspaidforfiscalyear2019duetotheuncertaintyrelatingtotheeffectsofthespread of the coronavirus at the beginningof2020.



Business environment

Kitchens are a lifestyle product affected by prevailing con-sumer trends. As a leading kitchen specialist, we interact with our customers through various distribution channels. The kitchen market can be divided according to whether the kitchens are sold to consumers or to professional customers, where the offer is adapted in accordance with the respective segments.

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The European kitchen market

The kitchen market in Europe is highly fragmented, though a gradual consolidation is under way. Competition is intense both in the market where kitchens are sold direct to consumers and in the market where kitchens are sold to professional customers.

Allmarketdataisapproximations.

The value of the European kitchen market is estimated at approximately EUR 13 billion, of which the professional mar-ketandconsumermarketeachaccountforEUR6.5billion.The four largest markets in Europe are Germany, the UK, ItalyandFrance.

Kitchen companies often act locally within a certain country or region, but there are some who, like Nobia, have gatheredseveralbrandsintothesamegroup.Totalkitchenconsumption in Nobia’s main markets - the UK, Sweden, Nor-way, Denmark, Finland, the Netherlands and Austria - is esti-matedtobeaboutEUR5billion.

The ongoing global corona pandemic increased con-sumer demand for home renovations - and thus also kitch-ens-overtheshortterm.TheprojectmarketintheUKhow-ever,decreased.Overthelongterm,itisuncertainwhateffectsthepandemicwillhave.

Customer segment Europe, %

Retail,50

Trade, 30

Project, 20

Sales channels Europe, %

Kitchen specialists, 40

Project sales and other, 30

Furniture stores and warehouses, 20

Builders’ merchants/DIY chains, 10

The European kitchen market, %

Purchasesforrenovation,80

Purchases for new production, 20

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The retail (consumer) marketFor private households, a new kitchen is a major and com-plex investment that includes the important factors of func-tion,layout,design,styleandmaterials.Asaroom,thekitchen is becoming increasingly important in our homes and consequentlykitchenfittingscostmore.Today,ready-to-as-semblekitchenproductsareasignificantportionofthemar-ket.Thegeneraleconomicclimate,interestratelevelsandconsumers’ faith in the future on questions of private econ-omyaffectdemand,asdoesanytaxreliefforrenovationsince installation expenses constitute part of the kitchen’s totalcost.

Nobia’s brands have strong positions in both the Nordic regionandtheUK.Kitchensaresoldthroughvariouschan-nels for example specialised kitchen stores, furniture stores and builders’ merchants, and to some extent directly via the Internet.Severalbrandsalsoprovidearangeofproductsof good value for those who want to assemble and install a kitchenthemselves.Nobiasellsthroughownstores,franchisestores and a large number of retailers who often specialise in kitchensorwhoareactiveasbuilders’merchants.

• An infrequently purchased product associated with a high level of involvement

• Aninvestmentmadeonaverageonceevery15to20 years

• Agreatdealofenergyinvestedinfindinginspira-tion and collecting information

• Customers want professional, customised help in planning and design

• Kitchen specialists, builders’ merchants/DIY chains and furniture stores are the most common saleschannels.Onlinesalesrepresentasmallshare.

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Omvärld


The professional marketSimply put, the professional market comprises two main segments: large project customers and local trade cus-tomers.Contractsforkitchendeliveriesaresignedonaproject-by-project basis, but it is common for business relation-ships to be long-term, especially among the major construction companiesintheNordicregion.InlargecountriessuchastheUK,kitchensuppliersfocustoagreatextentonaspecificseg-ment.Alltogether,professionalcustomershavesimilarproductrequirementsasconsumers,butdifferentserviceneeds.

Nobia operates in all professional segments through vari-ouschannels.Nobia’spositionisstrongestintheNordicregion.

Project customersHouse builders and construction companiesTheseplayerswanttooffertheircustomerskitchenswithexcellentdesignsandnumerousselectionpossibilities.Attractive kitchens are regarded as a part of marketing new properties.

Newhousingconstructionissensitivetoeconomicfluc-tuations.Demandisaffectedbymacroeconomiceventsand urbanisation as well as consumers’ expectations for the future as regards salary trends, housing prices, interest ratesandopportunitiesforborrowingmoney.

In the UK and the Nordic countries, kitchens are con-sidered building accessories and included in the sale of anapartmentorahouse.Thisislesscommon,however,incountriessuchasAustriaorGermany,whichmeanssignifi-cantlysmallerprojectmarketsinthesecountries.

Social housingSales of kitchens to tenancy apartments or the public hous-ing sector, who in the form of municipal housing authorities and tenant associations provide housing, are investments thatoftendependonstatesubsidiesandpoliticaldecisions.

Most kitchens are sold for renovation, normally as part of a plannedmaintenanceprogramme.Competitive prices and product durability are important aspects, as are simplicity in ordering and installation, reli-abilityofdeliveriesandshortdeliverytimes.

Kitchens for the rental market and social housing are an essential part of Nobia’s operations, primarily in the UK and the Netherlands, which have a relatively large stock of rentalapartments.

Tradesmen and small local construction companiesThis portion of the professional market comprises small com-panies with a small number of employees who usually pur-chaseandinstallonekitchenatatimefortheendconsumer.A number of these players focus only on kitchen installation, but the majority also perform extensive renovation work for privatehouseholds.

These smaller construction companies are important customersforNobia,aboveallforMagnetintheUK.Ourbrands in the Nordic market and Bribus also sell to smaller construction companies and builders, through both fran-chisestoresandbuildermerchants.

• Similar product requirements as consumers, butdifferentserviceneeds.

• Competitive advantages for major projects are dedi-cated project management, successful deliveries of large ordersontime,andproductsthatareeasytoinstall.

• Kitchen stores that allow consumers to experience thekitchensareacompetitiveadvantage.

• Increaseddemandforsustainabilitycertificationsand product labels

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The pandemic has impacted our rela-tionship with the kitchen in several ways. Many of us are working from the kitchen table, and some of us are exercising on the kitchen floor instead of at the gym. Sever-al studies show that many of us are also cooking and baking more than before.

Anton Öberg, Insight manager

Trends that impact our kitchens

The kitchen industry is greatly affected by consumer and lifestyle trends. To anticipate and meet our customers’ needs and create aesthetically and functionally attractive kitchens, we monitor these trends and changes carefully. In 2020, we noted several shifts that affect life in the kitchen. The clearest of these is naturally the pandemic, which has a major impact on how we spend time in our homes and on the role of the kitchen in the home and our lives.

The home plays a stronger roleThe combination of the pandemic with an ever-increas-ing supply of home deliveries and streaming enter-tainment mean that we are spending more time at home.Thefeelingofcomfortandwell-beingisthusmoreimportantthanever.Themorewesocialiseathome instead of - for example - meeting at restaurants andcafés,themoreimportantcomfortbecomes.The revival of the home as the center of our existence drives a demand for natural materials, colours and shapes that provide a feeling of comfort and well-be-ing, along with furniture and kitchen solutions that promotethesocialaspectsoflife.



worried,notless,aboutclimatechange.Weexpectthatissuessuchasclimateriskmanagement,scientificclimatetargetsandcircularitywillbecomeofgreatersignificancefor both the general public and our customers during the comingyears.

Hygienic design increasingly importantIn uncertain times, the demand for products that reduce worryandofferprotectiontendstoincrease.Overthepast year, hygiene and sanitation have become an import-antpartofourdailylives.Oncethepandemicisover,thiswill in all likelihood continue to be important, for example in the form of worktops that are easy to clean, materials with antibacterial properties and touch-free technology forappliancesandtaps.

The pandemic is creating needs for separate spacesIn a time when more and more people are working from home, the physical boundaries between spaces for work and social activitiesareoftenfluid.Sinceworkingfromhome,atleastpart-time, presumably will become the “new normal”, dividing spacesforvariousactivitieswillbecomeimportant.Thisisespeciallytrueinhomeswithopenfloorplans.Forexample,dividing spaces into activity zones using room dividers such as tall cabinets, or by building a smaller workplace into the kitchen.Thegoalistokeeptheadvantagesoftheopenfloorplan while creating conditions for both quiet individual and socialactivities.

Increased focus on well-beingAwareness of how our homes impact our physical and as well asemotionalwell-beinghasincreasedoverthepastyear.Therisk of infection, and in particular the fact that we are spending more time at home, have increased the focus on clean indoor air quality.Openfloorplansandhomesthatareincreasinglyfilledwith technology, have also increased the awareness of undesir-ableunwantednoise.Theseaspectsarebecomingmoreimport-ant in the design of housing and home décor in a time when healthandwellnessarehighontheagenda.

Climate and environmental issues are becoming more importantOver the past year, media reports on climate and sustainabil-ity topics have gradually been pushed aside by news of the pandemic.Thisdoesnotmean,however,thatpublicinterestin the environment and the climate has decreased; quite the contrary.Studiesshowthatmostpeoplehavebecomemore



Strategy

In addition to the Group’s financial targets, Nobia’s overall goals are to be the customers’ first choice everywhere we operate and to be a responsible company that is attractive to employees and investors. The coronavirus pandemic impacted operations during the year. Certain long-term strategic initiatives were somewhat delayed, to instead prioritise health and safety and the short-term financial development.

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We inspireStrong consumer brands

We deliver Unique mass-customisation abilities

We care Excellent customer responsiveness

Become the customers’ preferred choice in all markets and segments

in which we decide to compete

Earn a reputation for being a truly

responsible company

Be an attractive company to work

for, to partner with and to

invest in

Recipe to win

Overall goals

Structural efficiency People

engagement

AMBITION: Sustainability and Design Leadership

Growth acceleration

Strategic priorities

Sustainably, and successfully, leverage the Group’s advantages of large-scale production to strengthen our local competitiveness.

Regardless of whether the kitchens are sold to consumers or to professional players, it is a matter of thoroughly under-standingandmeetingourcustomers’needs.Understandinghow kitchens and individual lifestyles impact communities andourplanetisequallyasimportant.

To create long-term sustainable value, our knowledge must be converted into kitchen solutions that inspire, while the kitchens must be both economically and environmen-tallysustainable.Weintendtobeanindustryleaderinbothdesign and sustainability, and we are convinced that inspir-ing kitchen design and assuming responsibility in the value chain are what is required to become a leader: the one is a prerequisiteoftheother,andviceversa.

Being a leader in sustainability means: • settinganexampleinfindingabalanceamongvarious

interests and creating kitchen solutions that promote sus-tainablelivinginthekitchen.

• inspiring, guiding and making it easier for people to cook, eatandlivemoresustainablyintheirkitchens.

• reducing emissions of greenhouse gases across our value chain so that our company’s impact is in line with the Paris Agreement.

• increasingourcircularmaterialsflowsothatresources,materialsandproductsareusedforaslongaspossible.

• working to ensure that safety is the highest priority through-outouroperations,sothatnoworkplaceaccidentsoccur.

Being a leader in design means:• continually anticipating our customers’ expectations and

developing well-designed, functional and emotionally appeal-ingkitchensolutionsthatdistinguishusfromourcompetitors.

• keeping fast-paced development in upgrading the prod-uct range

• carrying out 1 - 2 major launches a year, based on funda-mental universal concepts that are adapted to the respec-tive countries and brands

A double purpose

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Strategy


Structural efficiency

Structuralefficiencyisaprerequisiteforbeingabletouti-lise the growth opportunities we see in the market while doingsowithhealthyprofitability.Thepreparationstorealise the investment in a highly automated Nordic pro-duction plant, to be located in Sweden, is a clear exam-ple of how we are improving our production structure and thereby strengthening our manufacturing capacity and our unique ability to mass-produce customised kitchens atacompetitiveprice.Continuingtohoneourproductionstructure through increased specialisation and over the long term centralising our component manufacturing are measuresthatenablelowerfixedcostsandfacilitatecon-centratedinvestments.

ToachievestructuralefficiencythroughouttheGroup,we are reviewing our entire value chain and evaluating, for example, how we best can meet our customers physically; we intend to increase the share of franchises over the next fewyearsaswellasexpandingdigitally.Transporteffi-ciency is another important link in the chain as regards loweringbothcostsandclimateimpact.Realisingecon-omies of scale in sourcing and production by introducing common standard dimensions for our core range allows us to stand at the leading edge as regards developing new products and concepts that make us stand out in relation totheendcustomers.

The work on harmonising our processes within the Grouphasalsobeengivenpriority.Thisisaprerequisiteformodernising,andthusenhancingtheefficiencyof,ourITarchitecture.

Implemented• The preparations for a highly automated Nordic produc-

tion facility in Jönköping, Sweden are proceeding at full speed.Thefacilityisexpectedtobefullyoperationalby 2024; two of last year’s milestones were to secure financingandtocometoanagreementwiththetradeunion organisations on a transitional programme for the employeesconcerned.

• Laidthefoundationforthestrategictransformationini-tiatives in order to harmonise business and supply-chain procedures,sothatweincreaseefficiencybymanagingprocessesuniformlyregardlessofcountryandbrand.

• Developed the Nordic product platform with a uniform white colour to facilitate synergies and decisions on a standardized cabinet range, for gradual introduction from2021.

• Introduced more options for remote design appoint-mentsandsalesviadigitalchannels.

Growth

acceleration

Salestotradecustomersisapriorityarea.Localbuild-ersnormallyinstall3to5kitchensayearandoftenhaveamajorimpactonconsumers’choiceofkitchens.IntheUK,wehavealreadyadapted160ofthearound200Magnetstores to better meet the needs of tradesmen, with a focus onmakingiteasytobeacustomer.Ourexperiencehasbeenpromisingandtheconceptwillbefurtherdeveloped.

Strengthening our position in consumer sales is an additional priority area in which we see opportunities to improve the customer experience regardless of sales chan-nel.Newdigitaltoolsandnewstoreconceptareexam-ples of how we inspire our customers and make it easier for themtorealisetheirkitchendreams.Productdesignisyetanother important area for continual development of the bestproductswiththemostappealingdesign.

Digital procedural tools that optimise the inclusion of kitchen blueprint documentation in construction plans and improve customers’ possibilities for visually creating their kitchens are another example of how we improve the cus-tomer experience from digital ordering to physical deliv-ery, which can increase the rate of growth, especially in theprojectcustomersegment.

Our strong market position in the Nordic region is a strength that could enable us to grow in neighbouring countries.Moreover,ourproductionplantinDenmarkisgeographically well placed for selective geographical expansion into new markets - northern Germany and the Benelux,forexample.

Implemented• Completed160storesforthenew,sharperconceptfortradecustomersintheUKthatwasinitiatedin2019.Theimprovedofferinghasfaredwell,withmanynewcontracts.Oneimportant priority going forward is continuing together to honeouroffering,therebycreatingtheconditionsforlong-termpartnerships.Oneexampleistheproductswedevel-opedsothatinstallationissimplerforbuilders.

• LaunchedadigitaltoolforthesalesprocessforMag-net’s consumer customers, with the goal over the long termofdigitisingallthestepsofthecustomerjourney.

• Continued to develop and invest in stores and franchise networks.

• Marbodal has launched the “Jordnära färger” colour series and invested in additional capacity for painted products since we have seen that demand in this area is strong.

Strategy


People

engagement

Nobia’s continued success is driven by the performance andcommitmentofourover5,900employees.Wecontinueto invest in strengthening Nobia and the Group’s brands as anattractiveemployerandpartner.Creatingasolution-ori-ented culture characterised by diversity, where every indi-vidual feels that they are involved, is crucial for our ability torecruitandretainemployees.Clearroles,responsibili-ties and targets that are broken down at a relevant level for all employees are prerequisites for achieving the results we strivefor.AsisensuringthatourmanagershavetherightabilitiesandconditionstoleadNobiatothenextstage.

Wewanttocreateaworkenvironmentthatissupport-ive, in which both managers and employees are encour-aged to provide constructive feedback to push Nobia’s developmentforward.Broadinitiativeslinkedtoleadership,skills development and health to ensure a continued high levelofemployeecommitmentarecrucial.Thepurposeistocreate an organisation that every employee can be proud of, enabling them all to work towards the same goal: being anindustryleaderindesignandsustainability.Continuingtoinvestinskillsdevelopmentandefficientcommunicationchannels are critical pieces of the puzzle in everyone’s con-tinuallearninganddevelopment.Highlevelsofcompetence,clarity and commitment are required so that we can be a successful,sustainablecompany.

Implemented• 2020 was a challenging year as a consequence of the

pandemic, and our primary focus was on ensuring the safety and health of our employees, customers and part-ners.WealsoquicklylaunchedMicrosoftTeamsandaGroup-wide training package in order to manage and workefficientlyinavirtualenvironment.

• Initiatives in learning in areas related to Nobia’s business and strategy on themes such as sustainability, design, strategyandsourcing.

• Communicationhasintensified,includingthroughthelaunch of a new intranet that provides employees with faster and better access to information and facilitates communicationswithcolleagues.

• Involved all employees in the company’s purpose, values andstrategyinordertobuildastrongculture.

As one of Europe’s leading kitchen spe-cialists, we have excellent conditions for creating profitable growth while having the possibility of and responsi-bility for ensuring a holistic perspective so that the environmental and climate impact from kitchens is minimised throughout the value chain.

Jon Sintorn, President and CEO

Strategy


Financial targetsAdjustedfinancialtargetsasofMarch2021,seepage43.

>5% GrowthNet sales are to grow organically and through acquisitions by an aver-ageofover5%peryear.

Target fulfilmentNetsalesdecreased9%.Organicsalesfell7%,andcurrencyeffectswere-2%.Byregion,organic growth was 3% in Nordic and 2% in CentralEurope.TheUK,whereoperationswereheavily impacted by the coronavirus pandemic, decreasedby19%.

Sales growth, %

>10%Operating marginThe operating margin is to amount to more than 10% over a business cycle.

Target fulfilmentTheoperatingmarginexcludingitemsaffectingcomparabilitytotalled4.6%(8.1).Theoperatingmargin for the Nordic region increased some-what, while the operating margin for the UK was negativeasaresultofthemajordropinsales.The Central Europe region improved its operat-ing margin, due in part to higher sales and an advantageousproductmix.

Operating margin excluding items affecting comparability, %

<100%Debt/equity ratioThe debt/equity ratio is tobelessthan100%.Atemporary elevation of the debt/equity ratio is acceptable in conjunc-tionwithacquisitions.

Target fulfilment Nobiahasastrongfinancialpositionandthedebt/equityratioiswithinthetarget.Thedebt/equityratiodecreasedto59%(89).ExcludingleaseliabilitiesunderIFRS16,thedebt/equityratiowas5%(31).NetdebtexcludingIFRS16lease liabilities and pensions decreased to SEK -352m(871).

Debt/equity ratio, %

40–60%DividendDividends to sharehold-ers are, on average, to comprise40–60%ofnetprofitaftertax.

Target fulfilment The Board’s proposal for the 2020 dividend is SEK2pershare.Duetotheuncertaintyrelat-ingtotheeffectsofthecoronaviruspandemicat the beginning of 2020, the Board of Directors decided to withdraw its dividend of SEK 4 per sharefor2019.

Dividends to shareholders, SEK %

Targets and target fulfilment

20

10

0

-10

Organic Acquisitions

12

8

4

0

90

60

30

0

Debt/equityincl.IFRS16Debt/equityexcl.IFRS16

9

6

3

0

Dividend, SEK Pay-out ratio, %1) Proposed dividend

150

100

50

0

20202019201820172016

20202019201820172016

20202019201820172016

20202019201820172016

Strategy


Sustainability targets through 20201

Sustainabilitytargets2021–2026,refertopages28–36.

100% Timber from sustainable sourcesBy 2020, 100% of our wood pur-chased will come from sustainable sourcessuchasforestscertifiedunder acknowledged forest stan-dards, recycled timber or timber from our suppliers who have been audited andapprovedforsustainability.

Target fulfilment 97%ofNobia’stotaltimberandwoodmaterialsoriginatefromacertifiedsource, and the remaining 3% comes from our audited and approved suppli-ers.Moreover,atleast80%ofalltimberand wood materials purchased in the UK region was from FSC® (Forest Steward-ship Council®) FSC® -C100100 or PEFC™,2 certifiedsources,withfulltraceabilityallthewaytothecustomer.

UN Global Compact principles: 2,7,8,9

UN Sustainable Development Goals

100% Renewable electricityBy 2020, all our production facil-ities in all markets will be run with 100%renewableelectricity.

Target fulfilment The target of 100% renewable electric-ity in all production facilities has already beenachieved.Moreover,allownstoreshave had 100% renewable electricity since2019.

UN Global Compact principles 7,8,9


Product sustainability scorecard By 2020, we will have implemented a sustainability scorecard to eval-uate the sustainability perfor-mance of our new kitchen products as regards choice of materials, design,andfunctionality.

Target fulfilment The product sustainability scorecard was successfullyimplementedin2019–2020.The scorecard is now back in use after a briefhiatusduetothecoronapandemic.

UN Global Compact principles 1,7,8,9


Supplier evaluation programme By 2020, we will have guaranteed a programme for supplier evalua-tion, risk analysis and audit, and a channel for reporting violations of ourCodeofConductforsuppliers.

Target fulfilment The programme has been implemented, andattheendoftheyear,92%ofthesupplierswereapprovedand8%wereawaitinganeworupdatedaudit.Duetothe corona pandemic, we conducted no physicalauditsduringtheyear.

UN Global Compact principles 1,2,4,5,7,8,10


1)ThesustainabledevelopmentgoalsareapartofNobia’s2017–2020sustainabilitystrategy.2)ProgrammefortheEndorsementofForestCertification™

UN Global Compact PrinciplesThe UN’s Global Compact initiative is based on commit-ments by businesses to work on sustainability topics by introducing the ten principles of the Global Compact: humanrights(principles1,2),labour(principles3,4,5,6),environment(principles7,8,9)andanti-corruption(princi-ple10).Readmoreatwww.unglobalcompact.org

The Sustainable Development GoalsThe 17 Sustainable Development Goals aim at eliminating extreme poverty, reducing inequality and injustice in the world, promoting peace and justice and solving the climate crisisby2030.Readmoreat:www.un.org

Strategy


Sustainability

The global challenges facing the world require responsible leadership and systematic work. We want to be a positive force in society by enabling a more sustainable life in the kitchen. Our focus moving forward is to contribute, scientifically, to reducing the climate impact of our value chain, contribute to more circular flows of material and inspire more sustainable lives.

MAR

BO

DAL

EK

KÖK

The year in figures

Sustainability is a business-critical area for us and we regard it a wise business decision to base our climate activities on a scientific platform. That is why it feels entirely right to have established a climate target that has also been approved by the Science-Based Targets initiative.

Amanda Jackson, Head of Sustainability

11% 0.85 97% 49%CO2e of sales ton CO2e per

SEK m of salestimber from

certifiedsourcessales of Nordic Swan

eco-labelled products in Sweden and Norway

88% 19threnewable

electricity and heatingofslightlymorethan500

companies in OpenCorpora-tion’s listing of more transpar-ent, inclusive and accessible

companies.

Topfive“Sustainable companies” in annual ranking ofsustainabilityeffortsby

OMX listed companies

Our CEO Jon Sintorn gave Nobia's support to Global

Compact's Renewed Global Cooperation.

140 63% 12% 263leaders in intensive train-

ing focusing on strategy and development

of wood waste becomes new products

kg VOC/100 lacquered details

suppliers approved after risk assessment and

follow-up

Sustainability


Sustainability throughout the value chain

We work to contribute to a sustainable value chain with more circular material flows and lower climate impact. Illustrated below are the primary links in our value chain and how we work to contribute to a more sustainable development at every stage.

PRODUCT DEVELOPMENT We offer kitchens that last for years. This long-term perspec-tive requires developing prod-ucts that meet both the needs of today and tomorrow. Sus-tainability is therefore a focus area already in the design phase.

SOURCINGThrough our responsible sourcing programme, we place demands, monitor and audit the work of our suppliers on social, environmental and ethical issues for the purpose of minimizing risk and promot-ing a more sustainable sup-ply chain.

MANUFACTURING

In manufacturing, we work systematically with health, safety, resource efficiency, the environment and the cli-mate. The majority of our pro-duction facilities are also ISO certified.

SALES

We have extensive experi-ence in designing and draw-ing kitchens. We help the cus-tomer the entire way from inspiration to installation in order to promote a sustainable kitchen solution for both cur-rent and future needs.

26

Sustainability

TRANSPORTATION

Transportation to customers takes place through distrib-utors, or alternately with our own vehicle fleet depending on the market. Through anal-ysis of our flows, we work to optimise our transport solu-tions and reduce our climate impact.

USEWith our kitchen solutions, we can enable our custom-ers to live more sustainably, for example, through a more sustainable choice of materi-als and by facilitating energy savings, recycling and reduc-ing food waste.

WASTE AND RECYCLING

We work to reduce our waste and increase our circular flow of materials. We also strive to encourage our customers to renovate, reuse and recycle their old kitchens.

Sustainability

27

New sustainability strategy

Sustainability is a central part of our business strategy and now we are launching our new sustainability strategy with the aim of creating positive change that extends well beyond our own operations. With conscious choices, the kitchen can be as modern today as it is sustainable for the next generation. Through our long experience and high ambitions, we want to assume leadership in key future issues.

Read more about the UN Sustainable Development Goalsonpage119.➔

Read more about the UN Sustainable Develop- mentGoalsonpage119.➔

1 2Innovations for a sustainable lifestyle The kitchen is a place where we spend a great deal of time, and where there is immense potential for thinking sustain-ably.Asaleadingkitchensupplier,wewanttoinspireandenable.➔ Overall goal: To design kitchen products that contrib-ute to a more sustainable life in the kitchen and to adapt our offeringofappliancestoreducecustomers’climateimpact.Read more on page 30.

Circular materials and flowsWoodisthemaincomponentofourproducts.Metalandplasticmaterialsareotherkeymaterialscategories.Wewanttoofferkitchenproductsandsolutionsthatwillfunc-tioninthemorecirculareconomyofthefuture.➔ Overall goal: To increase the proportion of sustain-able products and material to thereby enable cleaner and morecircularflowsofmaterials.Read more on page 31.

Sustainability


Reduced climate impactManufacturing, transportation and extraction of raw mate-rials contribute to climate impact and we want to strive to limitgreenhousegasemissionsinourvaluechain.➔ Overall goal: Wehavesetascientificclimatetargettoreduce emissions from our own operations and in our value chain.Indoingso,wewanttocontributetokeepingglobalwarmingwellbelow1.5°C,inlinewiththeParisAgreement.Read more on pages 32-33.


Promoting a sustainable cultureIn order to strengthen sustainability topics throughout the value chain, tools and support are required for integra-tion,aswellascontinuousskillsdevelopment.

➔ Overall goal: To strengthen skills in sustainability in our own operations and to work in our supplier chain, to strengthen our shared sustainability agenda. Read more on pages 34-36

3 4


Sustainability


Innovations for a sustainable lifestyleOur kitchens last for years. This sets high demands for us to develop products that meet both needs of today

and tomorrow. Sustainability is thus a central theme in our designs and product development.

Living sustainably should be easy. Wewanttoinspiremil-lionsofpeopletolivemoresustainablyinthekitchen.Wewanttodosobyofferingproducts,expertiseandsolutionsthat help economise on the earth’s resources for cooking, foodstorage,washingupandrecycling.Asasupportforour activities, we have developed and implemented a sus-tainabilityscorecardforproducts.Inourproductdevel-opment process, the sustainability performance of new kitchen products is assessed on the basis of material, design andfunction.Ourobjectivenowisforallournewkitchenproducts to enable the customer to live more sustainably and thus have average or the highest points on our score-cardby2025.

More eco-labelled products. Nobia has extensive expe-rienceinworkingwitheco-labelledproducts.OurNordicSwan eco-labelled range remains in strong demand, par-ticularlyintheNordiccountries.InSwedenandNorway,49%(47)ofthesalesvaluein2020camefromNordicSwaneco-labelledproducts.Atthesametime,wearecontinuingtodevelopourrangeandourtargetisfor90%ofournewlaunches of doors and laminated worktops in the Nordic markettobeeco-labelledby2026.

Energy-efficient appliances. Refrigerators and freezers are on24hoursaday,365daysayear,whichmakesthemoneof the product groups in the home that consumes the most energy.Ourgoalistoofferthemostenergyefficientappli-ances, thereby reducing our customer’s energy consump-tion and related climate impact, read more about our cli-mateworkonpage32.

Lifecycle perspective for better analysis. Weseemajorvalue in measuring and analysing our products’ environ-mentalimpactthroughouttheirlifecycle.Tothisend,weentered a joint industry project during the year, aimed

at raising knowledge about the environmental impact of prodcts and creating an industry-wide tool for producing EnvironmentalProductDeclarations(EPD).AtNobia,wewillbegin to develop EPDs for our own kitchen products, start-ingwiththeNobiabrandMarbodal.

Product safety. Safety and ergonomics are key in all our productdevelopment.Beforeanewproductentersthepro-duction phase, tests are carried out both in-house and by accreditedtestinginstitutionsinlinewithEUstandards.In the UK, all our cabinets and doors are tested under the Furniture Industry Research Association (FIRA) furniture requirements.

Results 2020. The goal of our strategy for the 2017-2020 period, to develop and implement a sustainability scorecard forproducts,hasnowbeenmet.

Comments: The product sustainability scorecard was successfullyimplementedin2019-2020.Thescorecardisnow back in use after a brief hiatus due to the coronavirus pandemic.

Goal Wewilladjustourproductportfolioofappliancestohelp

reduce the customer’s energy consumption and related climateimpactinthekitchenby2024(baseyear2019).

100% of our new kitchen products are to be designed to facilitateamoresustainablelifeinthekitchenby2025.

Aminimumof90%ofournewdoorsandlaminatedwork-tops in the Nordic region aretobeeco-labelledby2026.

1

49% of sales of Nordic Swan eco-labelled

products in Sweden and Norway


Sustainability

Circular materials and flowsWe continually review how we can optimise the use of materials and other resources. For us, it is important to contribute

to sustainable forestry and seek collaboration through the value chain to promote circular flows of materials.

Long-lasting kitchens. Wewantourkitchenstobelong-lasting.Accordingly, we only manufacture kitchens of high quality and withlongguaranteeperiods.Atthesametime,ourexperienceis that tastes change and for this reason, we want to enable our customers to upgrade and renew their kitchens without need-ingtoreplacetheirentirekitchen.Inaddition,weendeavourtoensure that the products we manufacture in our plants can be re-usedandrecycledintonewproductsandmaterials.

Wood from sustainable forestry. Woodisthemainmate-rialinourproducts.ThemajorityofoursuppliersofrawwoodmaterialsarelocatedinEurope.Toensurelegalcompliance,we gather information on traceability for the wood we pur-chase.Weachievedourstrategicgoalsfor2020forallofourpurchased wood to come from sustainable sources and now we are going a step further to increase the share of wood fromcertifiedsources.

Recycled materials. Most of our incoming wood consists of board material, with an average of approximately 30% recy-cledwoodintheformofby-productsandrecycledmaterial.This way, waste wood from sawmills and forestry as well as from worn-out furniture and wood products is upgraded into newmaterial.Weconstantlytrytofindnewwaysofincreas-ing the proportion of recycled material in our wood products, but also to increase the amount of recycled materials in other inputproducts,suchasmetalandplastic.

Our waste gains new life. Weworktoreducethewastefromour own production, a key factor in contributing to a more circu-lareconomy.Westrivetoensurethatourwastecanbere-usedasanewresource.Duringtheyear,63%(64)ofourwastewoodwenttonewproducts.Theslightdeclineontheprecedingyearwas due to temporary restrictions on the operations in the UK, wheretheproportionofrecycledwoodwasteishighest.

Broader offering of Nordic Swan eco-labelled products. Darkercoloursrequireadifferentformofsurfacetreatment,which was previously impossible within the framework of

theNordicSwan’scriteria.Accordingly,duringtheyear,weinvested in new surface treatment equipment at our plant in Tidaholm,inSweden,andthedevelopmentofpaintsystems.Acorresponding investment was made at our plant in Eggedal, in Norway.Thisnewequipmentnowenablesustomeetourcus-tomers’ higher demand for darker colours, while the kitchens alsomeetthestrictenvironmentalandqualityrequirements.

Reduced packaging. As part of our central sourcing proj-ect, we are working on reducing the impact from packaging materials,primarilyfossilfuel-basedplasticmaterials.Atour production plants in Nastola, in Finland, and Tidaholm, in Sweden, for example, we have switched to thinner plas-ticshrinkwrapandstretchfilm,whichreducesthetotalcon-sumptionofplasticintheseplantsbyupto40%.

Results 2020. The goal of our strategy for the 2017-2020 period of 100% of our wood being from sustainable sources hasbeenachieved.In2020,97%(91)ofNobia'stotaltimberandwoodmaterialsoriginatesfromacertifiedsource.Theremaining wood, 3%, came from sustainability audited and approvedsuppliers.Moreover,intheUKregionatleast80%(70) of all timber and wood materials purchased was FSC® orPEFC™certifiedscources,withfulltraceabilityallthewaytothecustomer.

Goal 100% of our cabinets and doors in the UK region will be

FSC® certifiedwithfulltraceabilitytothecustomerby2021.

100% of our knobs and handles in virgin plastic will be replacedbyamoresustainablealternativeby2023.

99%1 or more of our wood-based materials will come fromcertifiedsourcesby2025.

Wewillinitiatepartnershipsandcollaborationwithoth-ers to extend the lifetime of our materials and products andtherebyenableashifttoamorecirculareconomy.

1) Based on volume

2

Sustainability


Reduced climate impactClimate change is a fact and powerful and rapid measures are needed to slow the negative consequences

brought by higher global average temperatures. Naturally, we will take our responsibility to be involved in stopping this development and accordingly, we have chosen to set a scientific climate target.

Climate target in line with the Paris Agreement. During the year, we adopted a target of reducing our CO2 emissions, withinourownoperations,by72%by2026,with2016asthebaseyear.Thistarget,whichisinlinewiththeambitionscontained in the Paris Agreement, was approved by the Sci-ence-BasedTargetsinitiative(SBTi).Thetargetcomprisesour emissions from electricity, own and purchased heat and ourowntransportation,thatis,Scope1and2.

Toachieveourgoals,weneedtobeevenmoreeffi-cient in our use of energy, increase our share of renewable energy, and promote more climate-smart own goods trans-portationandbusinesstravelusingprivatevehicles.Inaddi-tion, we have adopted two climate targets to reduce the cli-mate impact in the value chain among our suppliers and our customers.Thesetargetscompriseemissionsfrommanu-facturing and use of appliances, and comprise the manu-facturers themselves setting climate targets in line with the STBiguidelinesandredirectingourofferingtomoreener-gy-efficientappliances,readmoreaboutthisonpage30.

From fossil to renewable. Measurement and follow-up are thebasisforimprovements.EnergyefficiencyandCO2 intensity are measured and monitored quarterly in our Group-wide management system and our production units haveimprovementtargetsinlinewithournewstrategy.

Wehave100%renewableelectricityinourproductionandinourownstores.Wehavealsoconvertedtomorefossil-freeandmoreeffectiveheat.Attheendoftheyear,74%ofNobia’stotal generated heat in production and in stores was renew-able,anincreaseof69%fromtheprecedingyear.

In the UK, projects are in progress to convert parts of the heating using fossil gas to instead use waste wood, while weareinvestinginevenmoreeffectivewastewoodcombus-tion.InFinland,weconvertedfromfossilgastobio-basedgasforheat.

Emissions from electricity, heat and fuel for our own transportation, that is, Scope 1 and 2, amounted to approx-imately10,900tonnes,adeclinefromapproximately13,300tonnes in the preceding year, which is partly attributable to thetransitiontorenewableheat.Wealsoseethatthetem-porary restrictions to our operations during the pandemic contributed to a reduction of CO2 emissions from, for exam-ple,ourowntransportationandtravelinpassengercars.

Reduction of transport-related emissions. Goods trans-portations are mainly conducted using external haulage companies, but also using our own vehicles, and comprise asignificantshareofourdirectandindirectCO2emissions.Emissions from our own vehicles are included in our recently adoptedscientificclimatetargetandwillbereducedaspartofthis.

During the year, we continued our work to reduce the impact of our goods transportation, including through route optimisationandnewandcleanervehicles.Wehavealsopro-cured the services of a new distributor for transportation in theNordicregion.Thepossibilityofmeasuring,monitoringand reducing transportation-related CO2 emissions was a keypartofthiswork.Wearealsoexaminingvarioussolutionstoreplacesomeroutesbyrailinsteadofroad.In2021,wewill, for example, initiate a shift from road to rail for deliveries

3


Sustainability

Continued reduction of climate emissionsSince2016,wehavemorethanhalvedourclimateemissionsfromScope1and2inrelationtoournetsales.Alargeshareofthisdevelop-ment is attributable to the conversion to renewable electricity, which wasalsoourstrategicgoalby2020.

During the year, we converted to renewable heat in our production inFinland.Inthismanner,wereducedtheCO2 emissions from heat by morethan900tonnes.Inaddition,thetemporaryrestrictionstoouroperations during the pandemic contributed to a reduction of CO2 emissions from, for example, our own transportation and travel in pas-sengercars.

ofHTHkitchensfromDenmarktoSweden,whichwillsignifi-cantly reduce CO2emissionsontheseroutes.

Survey of our indirect climate impact. In conjunction with the development of our new sustainability strategy, we have also made an in-depth study and surveyed our other indi-rectclimateimpact,thatwhichiscontainedinScope3.Thelargest part of Nobia’s total CO2 emissions derives from our value chain in the form of the recovery and manufacture of direct materials and products, transportation to and from ourplants,andtheuseofourproducts.Forinputmaterialsandgoods,wefocusedthesurveyonourlargestflows,aswood,metalandappliances.Thesurveyandcalculationsformedthebasisofourscientificclimatetarget.

The wood in our kitchen cabinets generate a relatively smallimpact,despitelargevolumesbeinghandled.Thelargest impact is from appliances, both in their production andtheiruseinthekitchen.Accordingly,wehaveestab-lishedtwostrategictargetsrelatedtoappliances.Wewillalso continue to work with other materials and product groupsaspartofoureffortsoncircularmaterialsandflows.

Risks of a changed climate. A changed climate entails risks, butalsoopportunitiesforouroperations.Duringtheyear,we initiated the implementation of a climate risk analysis in accordance with the Task Force on Climate-related Finan-cialDisclosures'(TCFD's)guidelines.Theriskanalysisworkis a comprehensive process and we will continue to develop ouranalysesandreportingmovingforward.Readmoreonpage58. Results 2020Wehave100%renewableelectricityinbothproduction and in our own stores and we have adopted new, ambitiousclimatetargetstoadvanceourwork.

Goal WewillreduceCO2 emissions from manufacturing

and own transportations (Scope 1 and 2) by 72% by2026(baseyear2016).

70% of our emissions from suppliers, based on CO2 emis-sions, that are encompassed by purchased goods and services, as well as the use of sold goods, must have adoptedscientificallybasedtargetsby2025.

20202019201820172016

Scope 1&2 kg CO2e/sales SEKm

1,421

3,026

1,399954 853

Science-based climate target in line with the Paris Agreementcontributing to limiting global warming to below 1.5 degrees.

Scope 3 upstream:50 % of our total carbon footprint in thevaluechain.

72%

Purchased goods and material

Acqui-red capital goods

Transport Production of heating in own prodcution sites

Heat for pro-duction sites and own sto-res

Electricity for production sites and own stores

Transport Product usage

End of life treatment

Scope 1 and 2: 4 % of our total carbon footprint in thevaluechain.

Scope 3 downstream:46% of our total carbon footprint inthevaluechain.

Target scope 1 and 2: We will reduce CO2 emissions from manufacturing andowntransportby72%by2026(baseyear2016).

Target scope 3: • Based on CO2 emissions from our suppliers in the categories of purchased goods and product usage, 70%ofthesupplierswillhaveadoptedscience-basedtargetsby2025.

• Wewilladjustourproductportfolioofappliancestohelpreducecustomers'energyconsumptionand relatedclimateimpactinthekitchenby2024.

2016 TARGET

2026

Calculations above form the basis for our SBTapproval.Thecate-gories illustrate our majoremissions.


Sustainability

Promoting a sustainable culture:

Sustainable corporate cultureOur culture is based on our core values: Care, Deliver & Inspire. This entails, for example,

that we respect and trust each other, and that we strive to make sustainable choices in all that we do.

Conditions for commitment and development. Wewanttopromote a culture of trust and openness, and one in which weareallowedtomakemistakesandlearnfromthem.Beingaccountable and keeping our promises - to customers, part-nersandeachother-ispivotaltooursuccess.

Weareconvincedthatthedifferentperspectivesthatarise through a focus on diversity, inclusion and equal-ity promote our ability to better understand and to act on bothcustomers’andemployees’needs.Forthisreason,weaim to work on creating an inclusive corporate culture in all parts of our operations, where people can make use of their fullpotential.

Nobia has a Board of Directors with six ordinary mem-bers elected by the Annual General Meeting, of whom three are women and three men, as well as four employee repre-sentatives,ofwhomtwoarewomenandtwomen.InGroupmanagement, including the CEO, the division is two women andsixmen.OfNobia’sseniormanagers,29%arewomenand71%men.

Organisational health. During the year, we continued to work with the results of a comprehensive survey on so-called organisationalhealth,whichwasconductedin2019.Thesurvey provided insight into how Nobia as an organisation performsandmeasuredourabilitytoachieveourgoals.Theresults were used, for example, as a basis for strategic prior-ities and projects, but also as a basis for ensuring that com-mitment and development permeate our organisation in the nextfewyears.Upcominginitiativesincludesharedvaluesandtraininginsustainability.

Digital transition with high level of commitment. During the year, we launched our new KitcheNet intranet that pro-vides our employees with faster and better access to infor-mationandfacilitatecommunicationswithcolleagues.KitcheNet is an example of how communication from Nobia’s centralfunctionstoemployeeswasintensified,basedonfeedbackinprioryearsthatthiswaslacking.

2020 was a challenging year due to the global corona-virus pandemic, during which our employees and lead-ers demonstrated extensive commitment and willingness to learnthroughtheirabilitytoadjust.Duetoarapidlaunchof Microsoft Teams and a Group-wide training package for employeesandmanagersineffectivevirtualworkandman-agement, our employees were able to continue to be pro-ductive and engaged, and share in skills development initia-tives.

A unique learning initiative related to Nobia’s business andstrategywasconductedundertheheadingof“LearnTogether”.Weeklywebinarsonsuchthemesassustainabil-ity, design and sourcing were held virtually and recorded, which enabled all employees to listen in and put questions toNobia’sexperts.

Continuous skills development. Leadershipisapriorityarea, in which we continued during the year to implement ourGroup-wideleadershipprogramme,ExcellentLeader,inwhich managers receive methods and tools to use in their dailyleadership.Thenumberofprogrammeswasreducedduring the year as a result of the coronavirus pandemic, but since these programmes were already partly conducted vir-tually from their launch, so the adjustment was not too sig-nificant.Asof2020,approximately400managerswere

4


Sustainability

encompassedbythevariousExcellentLeaderprogrammes,which have now been supplemented by videos in all lan-guages for quicker and more accessible leadership devel-opment.

As part of continuous skills development, the initiative ine-learningasaformofinstructionwasintensifiedduringthe year, in which we transformed the introduction for new employeesandtraditionalclassroomtrainingcourses.

Managers’ meeting with focus on strategy and devel-opment. At the beginning of 2020, Nobia’s Top Manage-ment Meeting (TMM) was held over two intensive days, with a focus on the roll-out of the new strategy, interaction and learning.Theparticipantswere140ofNobia’smanagersand specialists in decision-making positions from all coun-triesandunits.Overthesetwodays,theparticipantshadthe opportunity to learn from colleagues and external spe-cialists, including such areas as topics related to the new strategy and Nobia’s future challenges: Sustainability, WorkforceoftheFuture,FutureoftheConstructionIndus-try,FutureofRetail,Digitalisation.

Our Code of Conduct. A corporate culture that upholds integrity is a prerequisite for our reputation and our abil-itytobeanattractiveandstimulatingworkplace.OurCodeof Conduct is based on principles of environmental, social andeconomicsustainability.Itindicatestheminimumlevelofacceptablebehaviourforallemployeesandpartners.Employees are encouraged to report any conduct that breaches the Code via internal channels, or anonymously throughourreportingchannel,SpeakUp.Duringtheyear,33cases(30)werereported,ofwhich8(4)viaSpeakUp.The reported cases have been handled and reported to the Board’sAuditCommittee.ReadmoreabouthowweworkinaccordancewiththeCodeonpage55.

A permanent labour force. Nobia’s workforce can be divided up into employees working in production and logis-tics,andthoseworkinginadministrationandsales.Nobiamainlyhaspermanentemployees.Onlyapproximately1%are temporary; they are located in Sweden, the Netherlands andtheUK.NobiaprincipallyhasemployeesinsevenEuro-pean countries; all of our employees are covered by col-lective agreements in each of these countries except the UK.OuremployeesarerepresentedontheEuropeanWorkCouncil(EWC),aEuropeaninformationandconsultationcouncil.

A safe and healthy workplace. General demands on work conditions are described in Nobia’s Code of Conduct and localworkenvironmentpolicies.Overallworkenvironmen-tal responsibility rests with the CEO, who then delegates responsibility to the line managers in accordance with pro-ceduresineachrespectivecountry.Allemployeeshaveapersonal responsibility to contribute to a safe workplace, to actinasafemannerandtoreacttodeficienciesandriskybehaviour.Bothmanagersandemployeesarecontinuallytrainedinhealthandsafety.Thesafetyofemployeesisourhighest priority, and we have a vision of zero work-related injuriesandaccidents.Occupationalhealthcareisofferedto all employees at all units, but varies in scope between dif-ferentcountries.Inaddition,activitiestopromotehealthare

conducted at most units, such as exercise, massage, help to stopsmoking,etc.

Systematic and preventive work. All production units have local management systems that encompass all of the employees with more detailed health and safety proce-dures.ThemanagementsystemsarebasedonOHSAS18001orISO45000,ofwhichfiveoutof14productionfacilitiesarethird-partycertifiedandtwoothersarependingupdatedcertification,readmoreonpage118.

The local management systems comprise a framework to promote continuous improvements and include physical andpsycho-socialhealth,aswellassafety.Themanage-ment systems also provide guidance in compliance with leg-islation and requirements, as well as processes for working proactively to minimise the risk of occupational accidents andillhealthbyassessingandpreventingrisks.

Risk assessments are conducted at least annually at all units, with the employees who carry out the assessments receivingcontinuoustrainingtoensurehighquality.Forexample, in the UK, we trained managers and supervisors in risk assessments and involved employees in identifying and minimisingrisks.Asaresultofthis,wehaveseenasignifi-cant reduction in serious accidents, a large cut in high-level risks and a considerable decrease in insurance premiums foremployerliability.

The risk assessments are analysed and updated regu-larlyinallunitsandalwaysafteranincidenthasoccurred.Central and local safety committees, comprising local managers,engineersandsafetyofficers,meetregularlytoreviewtheresultsofsafetychecksandincidents.Thesecommittees are also usually included in the implementation ofriskassessments.

Monitoring and action. Safety is always highest on the agenda through daily monitoring of incidents and acci-dents, and is followed by investigation and action when applicable.Everyworkplaceaccidentisanalysedtoenablemeasures to be taken so that a similar accident never hap-pensagain.Workplaceaccidentsandactivitiestopreventthem are monitored by senior management on a monthly basisusingourscorecardforproduction.Thisscorecardisan internal tool that covers several strategically important questions,suchasworkplaceaccidents.InDenmark,acom-prehensive analysis of heavy lifting was conducted with the aimofsignificantlyreducingthescopeofheavyliftingforplantemployeesanddriversatNobia.

During the year, we succeeded in further reducing thenumberofworkplaceaccidents.In2020,54(62)work-place-related accidents occurred that resulted in at least eighthoursofsickleave.Thiscorrespondedto9.2(10.4)workplaceaccidentspermillionhoursworked.Mostoftheaccidents were related to manual processing and lifting but resultedinnopermanentinjuries.Noaccidentswithseriousconsequencestookplaceduringtheyear.

Goal By 2023, training, support and/or tools to further enable

a more sustainable culture will be integrated in the oper-ations and will be available for our employees in all markets.


Sustainability

Promoting a sustainable culture:

Responsible sourcingResponsible supplier chains protect vulnerable employees and reduce environmental and financial risks. Through our

programme for responsible sourcing, we will work to contribute to sustainable development in our value chain.

Programme for responsible sourcing. To manage risks in our supplier chain, we have a programme that covers risk analysis, review and evaluation and contains an anony-mous channel for reporting violations of our Supplier Code ofConduct.TheCodeofConductregulatesandgovernsNobia’s supplier requirements concerning working condi-tions, human rights, business ethics and environmental con-siderations.CompliancewiththeCodeofConductisarequirementinourriskassessmentofsuppliers.

Identified risk is a basis for monitoring.Ofoursuppliersofdirectmaterial,99%arefromEuropeandtheremainderfromAsia.Globalsupplierchainscaninvolvelabour-relatedrisks,suchasmodernforcedlabour.Nobiaworksactivelytoprevent all forms of modern slavery and we report our work and results annually in accordance the so-called Modern SlaveryStatement.

Nobia’s risk assessment programme and follow-up cover approximately300significantsuppliers,correspondingto99%ofourtotalcostfordirectmaterials.Theprogrammebuilds on such parameters as country of production, pro-duction process, product type and materials, as well as the supplier’s preparedness, for example, in the form of appli-cablemanagementsystem.Basedonthesefactorsriskisweighed against preparedness and we assess the risk of vio-lations of legal frameworks and Nobia’s Supplier Code of Conduct.Theriskassessmentisthebasisfordecisionsonauditsatthesupplier.

Audit is a tool for development. Physical supplier audits are intended to verify, manage and ameliorate any devia-tionsandtoidentifyareasforimprovement.Forexample,adecision on an audit may be the result of a supplier not hav-ingacertifiedmanagementsystem,combinedwithahigh-riskproductionprocess.Duringtheyear,weconductedno

physicalauditsduetocoronaviruspandemic.Alloutstand-ing audits have been rescheduled to 2021 and we plan to commencetheseinthesummer.Attheendoftheyear,92%of all suppliers in the programme were approved, while the remainderwereawaitinganeworupdatedaudit.Readmoreonpage119.

Exercising influence further up the supplier chain. Our responsible sourcing programme is a prerequisite for us in conducting risk analysis and risk prevention in our sup-plierchaininaquality-assuredmanner.Inordertopromotethe reduction of sustainability risks even further up the sup-ply chain in accordance with the objective in our new sus-tainability strategy, we ask our suppliers to also communi-catetotheirrelevantsubcontractors.Attheendof2020,67%ofoursuppliersintheprogrammerespondedthattheyare willing to share information about their supplier chain, which we interpret as a good prerequisite for the continued managementofrisksandimpact.

Results 2020. The goal of the 2017-2020 strategy was to implement a new programme for supplier monitoring, which hasnowbeenmet.Attheendoftheyear,92%ofthesuppli-ers were approved, while the remainder were awaiting a new orupdatedaudit.Throughtheprogramme,wenowalsohavean opportunity to go even further upstream the supplier chaininthecaseswhererisksareconsideredtobehigh.

Goal Wewillcontinuetosecureanddevelopprocessesforaresponsiblesupplierchain.By2023,wewill,whereverpossible, have reached further upstream in our supplier chain to identify suppliers regarded as higher risk, to promote human rights, good work conditions and envi-ronmentalconsideration.

4


Sustainability

Operations

Nobia is a leading kitchen specialist in the European kitchen market with well-known local brands and lead-ing market positions in seven countries. Nobia is organised in three geographic regions: Nordic, the UK and Central Europe. How we interact with the market differs among the various regions and also among our different brands.

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Our regionsNobia is a leading kitchen specialist in the European kitchen marketwithstronglocalbrands.FewotherEuropeankitchen companies are of a size that makes it possible to uti-liseeconomiesofscale.Nobiainvestsinproducts,saleschannels, production equipment and streamlining its prod-uctrange.InvestmentsindigitalsolutionstoharmonisetheGroup’s business procedures and facilitate the purchasing

process for customers for example, are becoming increas-inglyimportant.Centralisedsourcingandlarge-scalepro-ductionaretwoexamplesofhowcostefficiencyisachieved.Nobia is organised into three regions - Nordic, UK and Cen-tral Europe - and operates in seven countries: the UK, Den-mark, Sweden, Norway, Finland, the Netherlands and Austria.

Nobia in brief 2020Net sales, SEK m and operating margin, %


Sales by customer segment, %

Sales channels, %

Nordic

53% of sales

Denmark, Sweden, Norway, Finland Approximately 2,400 employees 23ownstores,168franchisestores Approximately 400 retail stores 6productionfacilities:Ølgod,BjerringbroandFarsøinDenmark.Eggedal in Norway; Tidaholm in Sweden andNastolainFinland. 5of6productionunitsare environmentallycertified

Organic growth was 3%, primarily through strong performance in consumer sales. Denmark showed stronggrowth,primarilythroughtheHTHbrand.Nor-way also showed organic growth, while Sweden was unchangedandFinlandnegative. A new organisation was introduced in order to better utilise collective strengths, facilitate investments and collaboration between brands, accelerate local deci-sion-making and move responsibility closer to the end customers. Somewhat higher operating profit and margins. Operatingprofitadjustedforitemsaffectingcompa-rabilityincreasedtoSEK897m(886)andtheoperatingmarginroseto13.2%(13.1).

Kitchenfurnishings,67 Other products, 27Installationservices,6

Retail, 33 Trade, 12Project,55

Kitchen specialists, own storesandfranchises,69 Direct project sales, 12 Builders’ merchants/ DIYchains,16 Other, 3

UK

37% of sales

UK Approximately 2,800employees 202 own stores Approximately450retailstores 5productionfacilities: Darlington, Dewsbury, Grays, Halifax,Morley.Allare environmentallycertified.

Organic growth was -19%. The market conditions were extremely challenging, and there was a dras-tic negative impact from restrictions and national clo-suresrelatedtocoronavirus. Successful implementation of digital channels for sales and customer service with robust growth in the numberofkitchendesignmeetings. Operating profitfelltoSEK-226m(345)owingtothemajor downturn in sales during the coronavirus pan-demic despite the cost reduction programme, fur-loughs,andfurloughsupportreceived.


Retail, 42 Trade, 34 Project, 24

Kitchen specialists, own storesandfranchises,66Directprojectsales,6 Builders’ merchants/ DIYchains,28

Central Europe

10% of sales

Netherlands and Austria Approximately600employees Morethan500saleslocations 3 production facilities: Dinxperlo in theNetherlands,FreistadtandWelsinAustria.Allareenvironmentallycertified.

Organic growth was 2% owing to strong perfor-manceinthesecondhalfoftheyear. Bribus in the Netherlands, acquired in 2018, con-tinued to perform well. Sales in Austria recovered afterthefirsthalfoftheyear,whichwasnegativelyimpactedbycoronavirusrestrictions. Operating profit increasedtoSEK143m(98)andtheoperatingmarginroseto11.1%(7.7). Kitchenfurnishings,58

Other products, 32 Installation services, 10

Retail,59Trade,5Project,36

Directprojectsales,36 Builders’ merchants/ DIYchains,5Other,59

Operations


Nobia in brief 2020Net sales, SEK m and operating margin, %


Sales by customer segment, %

Sales channels, %

Nordic

53% of sales

Denmark, Sweden, Norway, Finland Approximately 2,400 employees 23ownstores,168franchisestores Approximately 400 retail stores 6productionfacilities:Ølgod,BjerringbroandFarsøinDenmark.Eggedal in Norway; Tidaholm in Sweden andNastolainFinland. 5of6productionunitsare environmentallycertified

Organic growth was 3%, primarily through strong performance in consumer sales. Denmark showed stronggrowth,primarilythroughtheHTHbrand.Nor-way also showed organic growth, while Sweden was unchangedandFinlandnegative. A new organisation was introduced in order to better utilise collective strengths, facilitate investments and collaboration between brands, accelerate local deci-sion-making and move responsibility closer to the end customers. Somewhat higher operating profit and margins. Operatingprofitadjustedforitemsaffectingcompa-rabilityincreasedtoSEK897m(886)andtheoperatingmarginroseto13.2%(13.1).


Retail, 33 Trade, 12Project,55

Kitchen specialists, own storesandfranchises,69 Direct project sales, 12 Builders’ merchants/ DIYchains,16 Other, 3

UK

37% of sales

UK Approximately 2,800employees 202 own stores Approximately450retailstores 5productionfacilities: Darlington, Dewsbury, Grays, Halifax,Morley.Allare environmentallycertified.

Organic growth was -19%. The market conditions were extremely challenging, and there was a dras-tic negative impact from restrictions and national clo-suresrelatedtocoronavirus. Successful implementation of digital channels for sales and customer service with robust growth in the numberofkitchendesignmeetings. Operating profitfelltoSEK-226m(345)owingtothemajor downturn in sales during the coronavirus pan-demic despite the cost reduction programme, fur-loughs,andfurloughsupportreceived.


Retail, 42 Trade, 34 Project, 24

Kitchen specialists, own storesandfranchises,66Directprojectsales,6 Builders’ merchants/ DIYchains,28

Central Europe

10% of sales

Netherlands and Austria Approximately600employees Morethan500saleslocations 3 production facilities: Dinxperlo in theNetherlands,FreistadtandWelsinAustria.Allareenvironmentallycertified.

Organic growth was 2% owing to strong perfor-manceinthesecondhalfoftheyear. Bribus in the Netherlands, acquired in 2018, con-tinued to perform well. Sales in Austria recovered afterthefirsthalfoftheyear,whichwasnegativelyimpactedbycoronavirusrestrictions. Operating profit increasedtoSEK143m(98)andtheoperatingmarginroseto11.1%(7.7). Kitchenfurnishings,58

Other products, 32 Installation services, 10

Retail,59Trade,5Project,36

Directprojectsales,36 Builders’ merchants/ DIYchains,5Other,59

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Operations


Nordic regionMarket positionNobia is a leading kitchen supplier in the Nordic region with brands that are among the most well-known in their respec-tivemarkets.Salesareprimarilythroughfranchisestores,but also through own kitchen specialists and other retailers suchasDIYstores.Professionalcustomers,projectsalestoconstruction companies and sales to local builders repre-sent the largest customer segment, but consumers are also animportantsegment.Marketsharesarestronginallcus-tomer segments, and are largest in project sales for both newconstructionandrenovationprojects.

Nobia competes with both local players as well as kitchen producers and international furniture companies in alloftheNordiccountries.

Selection of competitors: Sweden:IKEA,Ballingslöv,Epoq. Norway:IKEA,Drømmekjøkkenet,Kvik.Denmark:Svane,IKEA,Kvik.Finland:Puustelli,Topi-Keittiöt,IKEA.

Market trend Despitethechallengesandnegativeeffectsonsocietyresulting from the coronavirus pandemic in 2020, the aggregate demand in the Nordic region increased slightly comparedto2019.Demandfromconsumersroseasaresultof increased interest in home renovations, since during the pandemic people spent more time at home instead oftravelling.Housingconstructioncontinueddespitedisruptions related to the pandemic, which is important for projectsales.Denmark,thelargestmarketintheNordicregion, had the best performance with continued growth in boththeconsumerandprofessionalsegments.InFinland,theprojectmarketcontinuedtoleveloffafteraperiodofrecordhighnewconstruction.

Brand Products Customer segment Sales channels Markets

Complete rigid kitchen solu-tions in the mid-price seg-ment.Asmallerrangeofready-to-assemblekitchens.

Consumers, pro-fessional custom-ers.

22 own stores in Denmark; 66franchisestoresinDenmark, SwedenandNorway.

Denmark, Norway, Sweden, Finland

Rigid and complete kitchen solutions in the mid-pricesegment.


10 franchise stores, retailers(e.g.theOptimera,BeijerandXLByggconstructionchains). Kitchens to major project customers aresolddirect.

Sweden, Norway

Rigid and complete kitchen solutions in the mid-pricesegment.


22 franchise stores, retailers(e.g.theByggmakkerhard-warechain).

Norway

Primarily rigid kitchens in the mid-pricesegment.


Nobia’s Keittiömaailma (Kitchen World)franchisechainwith30stores.Retailersinthebuildingmate-rialstrade.Kitchenstoprofessionalplayersaresolddirect.

Finland

Rigid kitchens with high design content in the upper mid-price segment.


Primarily through 24 franchise stores.

Denmark

Primarilyrigidkitchens.Thereis also a ready-to-assemble range in a lower price segment forconsumers.


6franchisestores, the Power electronics chain, retailersinthebuildingtrade.

Norway

Exclusive, expertly hand-crafted kitchens in the luxury segment.


1 own store and 4 franchise stores, as well as in a selection of HTH fran-chisestores.

Denmark, Norway, Sweden

Rigid kitchen solutions in the uppermid-pricesegment.


Nobia’s Keittiömaailma (KitchenWorld)franchisechain.

Finland

Operations


UK regionMarket position In the UK kitchen market, which is Nobia’s single largest mar-ket,Nobiaisingeneralaleadingplayer–butwithdiversifiedoperationsthroughoutitsmarketsegments.Kitchensunderthe Magnet brand, the UK’s largest and oldest kitchen brand, are sold through own stores directly to consumers and build-ers.Since2020,Magnethasalsoincludedoperationsforsales to segments such as social housing, which were previ-ouslypartofRixonway.Kitchensfortheprojectmarketaredelivered to housing and property development companies primarilyinCommodoreandCIEbutalsothroughMagnet.Kitchen products are also manufactured as private labels in ourGoweroperations,whichdeliversprimarilytotheWickesDIYchainandtheBenchmarxhardwarechain.

Selection of competitors: Howdens (primarily trade seg-ment),B&Q,WrenandIKEAintheconsumersegmentandSymphonyinprojectsales.

Market trendSales in the UK kitchen market decreased drastically in 2020owingtothecoronaviruspandemic.Nationalandlocal restrictions and lockdowns resulted in stores, plants and construction sites periodically shutting down, which madebothnewsalesanddeliveriesofkitchensdifficult.Demand in the consumer segment increased, however, as a result of a growing “stay at home” trend and growing inter-estininvestmentsinthehome.Inpreviousyears,themar-ket was characterised a “wait and see” attitude toward discretionary products such as kitchens owing to the uncer-taintyaroundtheeffectsoftheUKwithdrawalfromtheEU,whichwascompletedin2020.ThereisstillagreatneedforhousingintheUK.Theprojectmarket,however,hasbeen impacted by the general uncertainty of the past few years,withavolatilemarkettrendasaresult.Competitionremainedgenerallyfierceduringtheyear.


Rigid kitchens in the mid-price seg-ment, delivered with a high level ofservicecommitment.Arangeofready-to-assemblekitchens.Arange of kitchen products, doors and other joinery products is kept instockforbuilders.Installationservices.

Consumers and professional customers.

202ownstores.Mostservebothconsum-ers and professional customers such as builders, local construction companies andsmallerpropertydevelopers.Since2020, also includes operations that were previously part of Rixonway, kitchen solutionsforpublichousing.

UK

Ready-to-assemble kitchens and bathrooms, primarily under pri-vate labels but also under its own brand,Rapide.

Consumers and professional customers.

BuildingmaterialstradeandDIYchains. UK

Rigid kitchens in the mid-price seg-ment that by and large they man-ufacturethemselves.Thekitch-ens are normally sold installation included and with worktops and appliances.GroupcompanyCIEsells imported complete kitchen solutions in the luxury segment andinstallationservices.

Professional customers.

Kitchens direct to companies in property development and residential construction,primarilyinLondon andsouth-eastEngland.

UK

Operations



Rigid kitchens with modern designs in the mid-price and pre-miumsegments.

Consumers. Austrianfurniturechains. Over 400 independent kitchen specialists.

Austria, Germany, Italy, Switzerland

Rigid kitchens in the low- and mid-pricesegment.Thekitch-ens are most often sold together withinstallationandappliances.During projects, they provide over-allprojectresponsibility.

Professional customers.

Sold directly to construction companies, where they take overall project responsi-bility.Asmallportionofsalesaremadeto retailers in the building materials trade.

Netherlands

Rigid kitchens with traditional designs and a high level of func-tionality, such as solid wood counters and cabinets that can be raised and lowered, in the mid-priceandpremiumsegments.

Consumers. Austrianfurniturechains. Some190independentkitchenspecialists.

Austria

Rigid and complete kitchen solutions in the premiumsegment.

Consumers. Over 100 independent kitchen specialists.

Austria, Germany, Switzerland, UK

Central Europe regionMarket position Nobia has a small share of the total kitchen market in Central Europe, but has a relatively strong position in Austria - and alsointheNetherlandsaftertheacquisitionofBribusin2018.

In Austria, Nobia sells kitchens to the consumer segment underthebrandsewe,FMandIntuo.Salesareprimarilytoalarge number of independent kitchen specialists, some of whom are organised through purchasing organisations, and also to a fewmajorAustrianfurniturechainssuchasLeinerandXXXLutz.The Austrian operations also have a small amount of exports to itsneighbouringcountriesGermany,SwitzerlandandItaly.

In the Netherlands, Bribus concentrates primarily on customers in the rental market in the public housing sec-torandlarge-scalecommercialpropertyowners.Thekitch-ens are installed in newly constructed apartments or during renovation projects, and Bribus also provides project man-agementandinstallation.Bribusalsohasanumberofretail-ers, including the Bouwmaat builders’ merchants chain with approximately50salespointsthatsellkitchenstosmallerconstructioncompaniesandbuilders.

Selection of competitors: Austria: DAN Küchen, Nobilia, IKEA.Netherlands:BruynzeelKeukens,Keller,Mandemakers.

Market trendThe coronavirus pandemic brought uncertainty, and initially severe market disruptions, to Austria as a result of restric-tionsandclosures.Theconsumermarketgraduallyrecov-ered,andfinishedtheyearonastrongnote.Demandintheproject segment in the Dutch kitchen market is deemed to have been stable or slightly improved, but as in other mar-ketsthepandemicresultedinincreaseduncertainty.

KIT

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Operations


Board of Directors’ ReportThe Board of Directors and President of Nobia AB (publ), CorporateRegistrationNumber556528-2752,herebypres-enttheannualreportandcorporateaccountsforthefiscalyear2020.TheBoardofDirectors’Reportcanbefoundonpages43–58,thefinancialstatementsonpages59–98,thecorporategovernancereportonpages102–109andthesus-tainabilityreportonpages24–36,50-58and118-121.

Operations NobiaisaleadingkitchenspecialistinEurope.Nobiasellskitchens under some twenty strong brands, and as a con-tractmanufacturer.Theoperationcoverstheentirevaluechain, from development, manufacturing and installation to salesanddistribution,aswellasassociatedservice.

Sales to consumers are conducted through own and franchise stores and through a network of retailers, includ-ing furniture stores, builders’ merchants, DIY stores and independentkitchenspecialists.Salestoprofessionalcus-tomers, such as construction companies and tradesmen, are project sales to major customers, or via own stores, fran-chisestoresandotherretailers.

Nobia reports its operations based on three geographic regions:Nordic,theUKandCentralEurope.

Financial targetsToreflecttheambitionsinNobia’sstrategy,revisedfinancialtargetsfortheGroupwereadoptedinMarch2021.

Growth:Averageorganicgrowthistargetedtobe3–5%peryear.(Previoustarget:organicandacquiredgrowthofmorethan5%peryearonaverage).

Profitability: The operating margin is targeted to be greater than10%overabusinesscycle.(targetunchanged).

Capital structure: Leverage,definedasnetdebt(excl.IFRS16Leasing)/EBITDA,shallbebelow2.5times(previoustarget:netdebt/equityratiobelow100%).

Dividend policy: Dividends to shareholders shall comprise atleast40%ofnetprofitaftertax(previoustarget:dividendofbetween40–60%ofnetprofitaftertax).

Strategy Nobia’sstrategyendeavourstocreateprofitablegrowth,which means organic growth and improved margins in accordancewiththeGroup’sfinancialtargets.Thiswilltakeplace through such measures as increasing sales in priori-tised customer segments (such as trade customers), by util-isingeconomiesofscaleandsynergyeffectsinmanufactur-ing and product platforms, and by promoting a corporate culture characterised by a strong sense of commitment and inspiringleadership.Nobia'sambitionisalsotoberecog-nizedasaleaderindesignandsustainability.

2020 Marked by the coronavirus pandemicNobia’soperations,andtheentirekitchenindustry,sufferedseverenegativeeffectsfromthecoronaviruspandemicthatbrokeoutinearly2020.Tomitigatethespreadofinfection,various national governments introduced measures, restric-tionsandclosures.Nobiaworkedintensivelyonadaptingitsoperations to protect the health and safety of its employees andotherstakeholdersasmuchaspossible.Thenational

restrictions led to situations including the closure of Nobia’s plants in the UK and Austria during most of the second quar-ter.Storenetworkshadtobeclosedtocustomersperiodi-callyaswell.EventhepropertydevelopmentprojectsthatNobia delivers to stopped in certain markets, including the UK,withmisseddeliveries,andtherebysales,asaresult.Demand was initially negatively impacted, especially in the UK and Central Europe, resulting in dramatic downturns in salesandearnings.DuringthesecondquartersalesintheUK,forexample,decreasedbymorethan50%.Operationsin the Nordic region fared better, as plants and stores could stay open for most of the year, though with comprehensive measurestominimisetheriskofthespreadofinfection.Themajority of the Group’s employees in the UK were tempo-rarily put on furlough during the period when coronavirus restrictions obstructed both manufacturing and sales, and operationswerethusessentiallyclosed.

The Group’s total sales fell 7% organically for full-year 2020comparedtounchangedorganicgrowthin2019.TotalsalesfortheGroupdecreased9%toSEK12,741m(13,930).TheUKregionreporteda19%decreaseinorganicsales,whiletheNordic and Central Europe regions had 3% and 2% increases inorganicsales,respectively.TheoperatingmarginfortheGroupfellto4.6%(8.1),andoperatingprofitexcludingitemsaffectingcomparabilitytotalledSEK581m(1,132).

Significant eventsAnnual General MeetingAttheAnnualGeneralMeetingon5May,BoardmembersNoraFørisdalLarssen,MarleneForsellandGeorgeAdamswerere-elected.JanSvensson,ArjaTaavenikuandCarstenRasmussen were elected as new members of the Board, and NoraFørisdalLarssenwaselectedChairmanbytheBoardofDirectors.HansEckerström,StefanJacobssonandJill

Nobia Group summary

SEK m 2019 2020Change,

%

Net sales 13,930 12,741 -9Gross margin, % 38.1 34.9 -Grossmarginexcl.itemsaffecting comparability, % 38.1 35.7 -Operating margin before depreciation/ amortisation and impairment (EBITDA), % 14.1 11.2 -Operatingprofit/loss(EBIT) 1,132 437 -61Operatingprofit/loss(EBIT)excl. itemsaffectingcomparability 1,132 581 -49Operating margin, % 8.1 3.4 -Operatingmarginexcl. itemsaffectingcomparability,% 8.1 4.6 -Profit/lossafterfinancialitems 1,039 353 -66Profit/lossaftertax 810 253 -69Profit/lossaftertaxexcl. itemsaffectingcomparability 810 382 -53Earnings per share before dilution, SEK 4.80 1.50 -69Earnings per share before dilution excl.itemsaffectingcomparability,SEK 4.80 2.26 -53Earnings per share after dilution, SEK 4.79 1.50 -69Earnings per share after dilution excl.itemsaffectingcomparability,SEK 4.79 2.26 -53Operatingcashflow 1,179 1,808 53


Board of Directors’ Report

Littlehaddeclinedre-election.TheAnnualGeneralMeet-ing further appointed Peter Hofvenstam (Chairman) repre-sentingNordstjernan,RickardWennerklintrepresentingIfSkadeförsäkring,MatsGustafssonrepresentingLannebo fundsandArneLööwrepresentingtheFourthSwedishNational Pension Fund, as members of the Nomination Com-mittee for the period until the end of the 2021 Annual Gen-eralMeeting.

Dividend proposal withdrawnIn early 2020, the Board of Directors of Nobia AB (publ) decided to withdraw the proposal for a dividend of SEK4.00pershareinlightofthehighdegreeofuncertaintyresultingfromthenegativeeffectsofthespreadofcorona-virus.

New organisation and restructuringIn line with Nobia’s strategy for target growth, structural efficiency,peopleengagementandbecomingasustain-ability and design leader, the Group implemented organi-sationalchangesasof1September.Theneworganisationwill enable stronger regional accountability, faster decision makingandimprovedspeedinexecution.Theneworganisa-tion consists of three regions that are responsible for sales, marketing and customer service: Nordic, UK and Central Europe, as well as a Group-wide Product Supply function that is responsible for the product range and supply chain (i.e.sourcing,manufacturing,warehousinganddistribu-tion).Inconnectionwiththereorganisation,measureswerealsoimplementedtoincreaseefficiencywhichimpactedaround 240 employees across the UK store network and manufacturingorganisation.Inthisconnection,restructur-ingcostsofSEK93mwerechargedtoearnings.

Furloughs owing to coronavirusAs a consequence of the negative market impact from the spread of coronavirus, Nobia put approximately 3,000 employees on furlough at the end of March, of which 2,300 were in the UK where all kitchen stores and plants were tem-porarily closed as a result of local regulations and recom-mendations.OtherfurloughsaroseinotherpartsoftheGroupwithallcountriesimpacted.Inthethirdquarter,nearlyallofthemhadreturnedtoregularwork.

Changes to Group managementAfter the introduction of the new organisation on 1 September, Group management was altered to consist of Jon Sintorn (PresidentandCEO),KristofferLjungfelt(CFO),DanJosefsberg(EVP Customer Experience, Marketing & Communication), Ola Carlsson (EVP Product Supply), Cecilia Forzelius (EVP People & Culture), Ole Dalsbø (EVP Commercial Region Nordic) and Dan Carr(EVPCommercialRegionUK).

Cecilia Forzelius, who succeeded Thomas Myringer as EVP People & Culture, was recruited from Transcom, where shewasChiefPeopleOfficer.SaraBjörkwasrecruitedasthenewChiefInformationOfficer(CIO)andamemberofGroupmanagementasofDecember2020.Hermostrecentposition was as Head of IT for H&M Group’s IT division for design,sourcingandproduction.DanCarr’smostrecentpositionwasasCFOfortheUKregion.

Peter Kane, Ralph Kobsik, Fredrik Nyström, Rune Stephansen and David Thorne resigned their positions in connection with the reorganisation and left Group manage-ment.

Preparations for investment in new production plantNobia continues preparations for its investment in a highly automated production plant in Jönköping, Sweden, which is expectedtobeinfulloperationby2024.AfternegotiationsundertheCo-DeterminationintheWorkplaceAct(MBL)with the trade unions concerned were concluded, the Board decided to construct the new plant in Jönköping and sub-sequently depreciate the assets related to machinery and buildingsatthecurrentplantinTidaholmbySEK136m.Fur-thermore, Nobia and the trade unions came to an agree-ment on a transitional programme that will ensure future employment for all employees currently working at the plant inTidaholm.Theprogrammeincludescompetencedevel-opment, commuter support, and the aim of establishing a manufacturing entity for specialised components in Tida-holmwhichwillbedivestedovertime.Totalinvestmentsinmachinery in the new plant are estimated at approximately SEK2billion.Additionally,approximatelySEK1.5billionwillbe invested in the factory building which is expected to be soldandleasedbackoncetheplantisfullyoperational.

New long-term debt financing Nobia has signed an agreement with Svenska Handelsbanken AB(publ)andNordeaBankAbp,filialiSverigefortwomulti-currencyrevolvingcreditfacilitiestotallingSEK5billion:aSEK2 billion facility with a term of three years (with a possibility to request an extension of up to two years at the lenders’ sole discretion)andaSEK3billionfacilitywithatermoffiveyears.The new credit facilities will replace, extend and increase the currentfacilityNobiahaswiththesamebanks.

BrexitTheUKlefttheEuropeanUnionon1February2020.Duringa transition period up until a permanent agreement is nego-tiated between the UK and the EU in early 2021, free move-mentfortradeandpersonswillstillbeineffect.Todate,Nobia has not been impacted by any major interruptions to operationsasaresultoftheUK’swithdrawal.

Climate targets approved by the Science-Based Targets Initiative (SBTi).Nobiaisthefirstkitchenspecialisttohaveadoptedsustain-abilitytargetsinaccordancewithScience-BasedTargets.As part of a new sustainability strategy, new climate targets basedonscientificfactshavebeenapprovedbytheSBTi.The targets are:• To reduce carbon emissions from operations and own transportations(Scope1and2)72%by2026(frombaseyear2016).

• To collaborate with suppliers to reduce their carbon emis-sionsfromproductionanduse.Atleast70%ofNobia’ssuppliers (based on carbon emissions) must have Sci-ence-BasedTargetsby2025.

Annual General Meeting and dividend proposalNobia’sAnnualGeneralMeetingwillbeheldon29April2021.Forthe2020fiscalyear,theBoardofDirectorspro-posesadividendofSEK2pershare(0).Therewasnodivi-dendforthe2019fiscalyear,sincethedividendproposalwaswithdrawnowingtouncertaintyrelatedtotheeffectsofthepandemic.Thedividendproposalentailsatotaldiv-idendofapproximatelySEK338m.Therecorddatefortheright to receive a dividend is Tuesday, 3 May 2021, and the finaldayfortradinginNobiashares,includingtherightto



receiveadividend,is29April2021.IftheAnnualGeneralMeeting resolves in accordance with the Board’s proposal, the dividend is expected to be paid via Euroclear Sweden AB onThursday,6May2021. The Group’s financial performance Net salesNetsalesamountedtoSEK12,741m(13,930), distributedasfollows:Nordicregion,SEK6,801m(6,753);UKregion,SEK4,649m(5,902);andCentralEuroperegion,SEK1,291m(1,275).

The Group’s organic growth, meaning the change in net salesforcomparableunitsandadjustedforcurrencyeffects,totalled-7%(0).OrganicgrowthintheNordicregionwas3%(-1).OrganicgrowthintheUKregionwas-19%(1)andorganicgrowthintheCentralEuroperegionwas2%(-4). Earnings TheGroup’searningsfor2020includeitemsaffectingcom-parability of SEK 144m primarily related to depreciation of assetsafterthedecisiontoinvestinanewplantinSweden.TheGroup’sgrossmarginexcludingitemsaffectingcompa-rabilitydecreasedto35.7%(38.1)andtheoperatingmarginfellto4.6%(8.1).Thegrossandoperatingmarginswerepos-itively impacted by higher average sales prices, but primar-ilynegativelybytheeffectsofthelowersalesvolumesandtherebylowerproductivity.

By region, the lower margins are primarily attributable to the performance in the UK region, where operations were hardest hit by closures due to the pandemic, whereas the margins in both Nordic and Central Europe were better or in linewithpreviousyearsadjustedforitemsaffectingcompa-rability.TheUKregionwassuccessfulinredirectingapartof its sales through digital channels, and several cost initia-tiveswereimplemented.Thenegativeeffectsfromthegov-ernmental coronavirus restrictions, however, were much greaterthancouldbeoffsetbyimprovementmeasuresand grants in the form of furlough support, and the region postedalossfortheyear.

OperatingprofitfortheGroup,excludingitemsaffect-ingcomparabilityofSEK144m,felltoSEK581m(1,132).Oper-atingprofitalsoincludesnon-recurringitemsincludingrestructuringcostsofnearlySEK-100m.ThesecostspertaintomeasurestoincreaseefficiencyintheUK,whichaffectedapproximately 240 employees in the store network and manufacturingorganisation.Exchange-ratefluctuationsnegativelyimpactedoperatingprofitbySEK-65m.

IntheNordicregion,operatingprofitamountedtoSEK897m(886)excludingitemsaffectingcomparabilityof SEK-132m(referto“Itemsaffectingcomparability”onpage45).Higheraveragesalesvaluesandlowermaterialcostswereoffsetbylowerproductivity.Currencyeffectsinoper-atingprofittotalledSEK-70m.

IntheUKregion,operatingprofitexcludingitemsaffect-ingcomparabilitywasSEK-226m(345).Despiteimprove-ment measures as an increase in sales and customer service through digital channels, cost reductions and furlough sup-portreceived,itwasnotpossibletooffsettheeffectoftherobust downturn in sales - primarily in the second quarter during the period when plants and stores were closed owing tocoronavirusrestrictions.CurrencyeffectsonoperatingprofittotalledSEK5m.

IntheCentralEuroperegion,operatingprofitamountedtoSEK143m(98).Theimprovementinearningswasprimarily

attributable to an advantageous sales mix, lower costs and furloughsupportreceived.Currencyeffectsonoperatingprofitwereneutral.

Group-wide items and eliminations amounted to an operatinglossofSEK-233m(-197)excludingitemsaffectingcomparability.

NetfinancialitemsamountedSEK-84m(-93).Netfinan-cial items included the net of return on pension assets and interest expense for pension liabilities corresponding to SEK -17m(-21).NetinteresttotalledSEK-67m(-72),ofwhichSEK-48m(-55)pertainedtointerestonleases.Profitafterfinan-cial items amounted to SEK353m(1,039).

TaxexpenseamountedtoSEK-100m(-229).ProfitaftertaxamountedtoSEK253m(810).

Earnings per share for the year before and after dilution totalledSEK1.50(4.80beforeand4.79afterdilution).

Items affecting comparabilityNobiarecognisesitemsaffectingcomparabilityseparatelyto distinguish the performance of the underlying oper-ations.Itemsaffectingcomparabilityrefertoitemsthataffectcomparisonsinsofarastheydonotrecurwiththesameregularityasotheritems.

Thefourthquarterof2020includesitemsaffectingcomparability attributable to depreciation of machin-eryandfixedassetsattheTidaholmplant,duetothedeci-sion to replace the plant with a new one in Jönköping that is planned for completion in 2024, as well as a pension adjust-mentintheUK.Intotal,theGroup’soperatingprofitwaschargedSEK-144m,ofwhichSEK-105mimpactedthegrossprofit.ItemsaffectingcomparabilityofSEK-132mwerechargedtooperatingprofitintheNordicregion,SEK-8mtotheUKregion,andSEK-4mtoGroup-wideitems.Noitemsaffectingcomparabilitywererecognisedduring2019.

Items affecting comparabilitySEK m 2019 2020

DecisiontocloseTidaholm2024 - 136Pension adjustments in UK - 8Items affecting comparability in operating profit - 144

Of which in gross profit - 105Itemsaffectingcomparabilityintax - -15Items affecting comparability, earnings after tax - 129

Investments, cash flow and financial positionInvestmentsinfixedassetsamountedtoSEK308m(465),ofwhichSEK199m(372)pertainedtotangiblefixedassetsandSEK109m(93)tointangibleassets.Investmentsdecreasedowingtotemporarilyloweractivitylevelsandcashflowpri-orities during the macroeconomic uncertainty as a conse-quenceofthecoronaviruspandemic.

OperatingcashflowamountedtoSEK1,808m(1,179).Cashflowfromoperatingactivitiesandinvestmentsinfixedassetswerebetterthantheprecedingyear.Cashflowfromoperating activities were positively impacted by factors including changes in working capital and lower tax paid, whichoffsettheeffectfromtheloweroperatingprofit.

The Group’s operating capital decreased to SEK6,421m(8,096),dueprimarilytolowerfixedassets.

Netdebt,includingIFRS16leaseliabilitiesof SEK2,183m(2,475)andpensionliabilitiesofSEK556m(473)decreasedtoSEK2,387m(3,819).ExcludingIFRS16leaselia-bilitiesandpensions,netdebtdecreasedtoSEK-352m(871).



Thedebt/equityratiowas59%(89),or-9%(20)excludingIFRS16leaseliabilitiesandpensionliabilities.

Acquisitions and divestments Noacquisitionsordivestmentsoccurredin2020.

Significant events after the end of the yearTheGroupsfinancialtargetswereadjustedinMarch2021,seeNote34onpage97.

Future outlookDemand for kitchens normally follows the same business cycleasotherconsumerdiscretionaryproducts.Owingtouncertainties caused by the coronavirus pandemic and its effectsonsocietyasawhole,makingaqualitativeforecastformarketoutlooksisdifficult.Onecleartrendduringthepan-demic, however, has been increased demand for kitchen prod-uctsfromconsumers.Peoplearespendingmoretimeathome,andlesstimeandmoneyontravel,forexample.Instead,thewillingness to increase and renovate at home is increasing, withincreaseddemandforkitchensasoneexample.

Personnel In2020,theaveragenumberofemployeeswas5,977 (6,161).Thenumberofemployeesatyear-endwas5,901(6,109).

Environment and sustainabilityNobia conducts activities that require a permit under the Swedish Environmental Code through Nobia Production Sweden AB, which includes Nobia’s Swedish operations in productionandlogistics.Theenvironmentalimpactoftheproduction plant primarily comprises transportation of kitchen products by truck, airborne emissions from surface treatment of wooden items and noise from manufacturing ofkitchenandstorageproducts.TheCountyAdministrativeBoard of Västra Götaland is the regulatory authority and decision-makingbodyregardingpermitapplications.NobiaProductionSwedenABiscertifiedtotheISO14001environ-mentalmanagementstandard.

All of Nobia’s 14 production units, located in seven Euro-pean countries, satisfy the environmental requirements determined by each country and 13 of these have been awardedISO14001certification.

Nobia works conscientiously with sustainability topics through the implementation of a Group-wide sustainability strategy.Nobia’sstatutorysustainabilityreportisfoundonpages24–36,50-58and118-121 Product developmentAll product development for the Group-wide range is man-agedcentrally.Workonproducingnewproductsisfocusedonanumberofareasthatmeetspecificcustomerrequire-ments.Duringthecourseoftheprocess,prototypesaredevelopedthataretestedonconsumers.

Parent Company The Parent Company, Nobia AB, has operations compris-ingGroup-widefunctionsandtheownershipofsubsidiaries.The limited liability company is domiciled in Sweden and the headofficeislocatedinStockholm.TheParentCompany’slossafterfinancialitemstotalledSEK-361m(521).

The share and ownership structure The Nobia share has been listed on Nasdaq Stockholm since 2002.Nobia’ssharecapitalamountedtoSEK56,763,597(56,763,597)on31December2020,dividedamong170,293,458shares(170,293,458)withaquotientvalueofSEK0.33.Nobiahasonlyoneclassofshare.Eachshare,with the exception of repurchased treasury shares, entitles the holder to one vote, and carries the same entitlement to thecompany’scapitalandprofits.

The 2020 AGM authorised the Board to decide on the buy-back of up to 10% of the outstanding shares and, for the period until the 2021 AGM, to decide on the transfer of treasury shares for the purpose of delivering shares under PerformanceSharePlansoroffacilitatingfinancingofacquisitionsthroughpaymentusingtreasuryshares.

No shares were bought back or transferred to partic-ipantsinNobia’sPerformanceSharePlanin2020.Attheendof2020,thenumberoftreasuryshareswas1,440,637(1,440,637),correspondingto0.9%ofthetotalnumberofshares.Theseshareswereacquiredin2007and2008foratotalamountofSEK82,611,536.

Atyear-end,thetenlargestownersheldabout67%oftheshares.Thesinglelargestshareholder,Nordstjernan,owned24.9%oftheshares.IfSkadeförsäkringheld10.7%oftheshares,theFourthSwedishNationalPensionFund7.4%andSwedbankRoburfunds5.1%.

Nobia’s lenders have the option of terminating all loans if thecontrolofthecompanyweretobesignificantlyaltered.If any one party, or jointly with other parties (under formal or informal forms) gains control of the company, the lend-ers are entitled to terminate all outstanding loans for pay-ment.Theterm“controlofthecompany”pertainstocon-trol of more than half of the total number of votes or capital, ortheacquisitionofdirectanddecisiveinfluenceovertheappointment of the Board of Directors or members of Group management.Controlofthecompanyisalsodeemedtoarise if a party, alone or jointly with other parties, can exer-cisedirectanddecisiveinfluenceoverthecompany’sfinan-cialandstrategicposition.Ifsuchasituationweretoarisewherebythecontrolofthecompanyweretobesignificantlyaltered, the lender and Nobia shall begin negotiations that shalllastforamaximumof30days.

The aim of these negotiations is to reach an agree-mentbetweenthelendersandNobia.Ifanagreementisnotreached, the lender is entitled to terminate all outstanding loansforimmediatepayment.

More information on the share and shareholders is pre-sentedonpages114–115.

Remuneration guidelines and other employment conditions for Group management 2020The guidelines for 2020 essentially correspond with the pro-posedguidelinesfor2021,aspresentedbelow.

Remuneration CommitteeThe Board of Directors has inaugurated a Remuneration Committee consisting of two Board members elected by thegeneralmeetingofshareholders.TheCommittee’staskis, inter alia, to prepare proposals to the Board of Direc-torsrelatingtotheremunerationforseniorexecutives.TheBoard will draw up proposals for new guidelines and put for-ward the proposal for resolution by the general meeting of shareholders.Theseguidelineswillbeineffectstartingfromthe approval of the general meeting until such time as new



guidelinesareadoptedbythegeneralmeeting.TheRemu-neration Committee shall also follow-up and evaluate pro-grammes for variable remuneration to senior executives, the application of the remuneration guidelines and current remunerationstructuresandlevelsinNobia.Themembersof the Remuneration Committee are independent in relation tothecompanyandcompanymanagement.

To strengthen senior executives’ commitment to and ownership in the company, and to attract, motivate and retain key employees in the Group, Nobia resolved at the respectiveAGMsfrom2012to2015oninauguratinglong-term remuneration schemes based on matching and perfor-manceshares.Theschemes,whichencompassedsome100individuals comprising senior executives and senior manag-ers, were based on the participants having in Nobia shares thatare“lockedinto”theplan.EachNobiasharethepartic-ipants invested in under the framework of each plan entitled the participants, following a vesting period of about three yearsandprovidedthatcertainconditionsarefulfilled,toallotment (for no consideration) of matching and perfor-mancesharesinNobia.Theconditionsarelinkedtothepar-ticipant’s continued employment and ownership of invested shares,andtofulfilmentofafinancialperformancetarget.The costs for the programmes are reported prior to each AGMandinNobia’sAnnualReports.

Atthe2016-2018AGMs,resolutionswerepassedtointro-duce new long-term remuneration schemes directed to the same target groups and with largely the same structure as theremunerationschemesfrom2012to2015,butinwhichthe requirement for performance from the participants was strengthened–whichiswhynomatchingshareswereallot-ted.Norwasanyrequirementsetupthattheparticipantsinvestintreasuryshares.Participantswereawardedper-formance-based share rights that carry entitlement to allot-mentofshares.Attheendofthevestingperiod,thepar-ticipants will be allotted shares in Nobia free of charge, providedthatcertainconditionsarefulfilled.Entitlementto allotment of shares requires that the participant remain anemployeeoftheNobiaGroupduringthevestingperiod.Participationinthe2016–2018PerformanceSharePlansentailed that the maximum short-term variable remunera-tion for participants was adjusted downwards by ten per-centagepoints(forthePresident),fivepercentagepoints(Group management) and three percentage points (other seniorexecutivesandmanagers).Allotmentofsharesalsorequiresthatafinancialperformancetargetlinkedtoaccu-mulatedearningspershareforNobiaduringthe2016/2017,2017/2018and2018/2019financialyearsisachieved.Allot-mentismeasuredonastraight-linebasis,whereby25%ofthe share rights will entitle allocation of shares if the estab-lishedminimumlevelisachieved.Iftheminimumlevelintherange is not achieved, the share rights will not give entitle-ment to any shares and if the maximum level in the range is achieved, each share right gives entitlement to one Nobia share.Forthe2018Plan,theBoardadoptedaminimumlevelfor allotment of shares related to accumulated earnings per share,excludingitemsaffectingcomparabilityforthe2018and2019financialyears,ofSEK11.75.ThemaximumlevelwassetatSEK13.00.SincetheaccumulatedearningspershareexcludingitemsaffectingcomparabilityfortheperiodamountedtoSEK9.59,theBoard’sminimumtargetfigurefor allotment was not achieved and no allotment of shares underthe2018PerformanceSharePlanwilltakeplace.

Aresolutionwasmadeatthe2019AGMtoestab-lish a long-term remuneration scheme based on perfor-manceshares.The2019PerformanceSharePlancomprisesapproximately 100 employees consisting of senior execu-tivesandseniormanagerswithintheNobiaGroup.Partic-ipation in the plan requires an employee’s private invest-mentinNobiashares.Attheendofathree-yearvestingperiod, the participants will be allotted shares in Nobia free ofcharge,providedthatcertainconditionsarefulfilled.Enti-tlement to allotment of shares requires that the participant remain an employee of the Nobia Group during the vest-ing period, and that the investment in Nobia shares lasted initsentiretyforthesameperiod.Inaddition,theallotmentof shares requires that the performance targets related to averageoperatingprofit(EBIT)andtotalshareholderreturn(TSR)onthecompany’sshareshavebeenachieved.How-ever, if the EBIT performance target has been achieved but the TSR target on the Nobia share is negative, no allotment willtakeplace.Ifthesetminimumlevelsfortheperformancetarget are achieved, the share rights entitle the holder to receiveallotmentof25%.Iftheminimumlevelintherangeis not achieved, the share rights will not give entitlement to any allotment, whereas each share right gives entitlement tooneNobiashareofthemaximumlevelisachieved.Allot-ment between the minimum and maximum levels takes place straight-line based on the intermediate amounts between thetwolevels.

No new long-term remuneration scheme was launched in2020.

The Board’s proposal on remuneration guidelines and other employment conditions for Group managementThe remuneration guidelines cover total remuneration for the group management, including the President and other seniorexecutives.Theguidelineswillbeappliedtoremuner-ations that are agreed on, and changes to remunerations previously agreed on, after the guidelines are adopted by the2021AGM.TheguidelinesdonotcoverremunerationresolveddecidedbyAnnualGeneralMeeting.

The guidelines’ promotion of the company’s business strategy, long-term interests and sustainabilityThe purpose of the guidelines is to provide a structure that adapts the remuneration to the company’s strategy, long-termgoalsandsustainability.Inthefuture,Nobiaintendstoconnecttheremunerationforseniorexecutivestofulfilmentofestablishedsustainabilitytargets.Nobia’svaluecreationstrategy consists of three central components:• Focusonprofitablegrowth• Increasingefficiency• Long-termvaluecreationthroughcontinualsustainabil-

ity initiatives

The company’s strategy requires that Nobia can continue to attract, motivate and retain key employees within the Group.Theguidelinesmustthereforeenableappropriateandcompetitiveremunerationtoseniorexecutives.

Decision-making process for determination, review and execution of the guidelinesThe Board of Directors has inaugurated a Remuneration Committee consisting of two Board members elected by thegeneralmeetingofshareholders.TheCommittee’stask



is, inter alia, to prepare proposals to the Board of Direc-torsrelatingtotheremunerationforseniorexecutives.TheBoard shall prepare proposals for new remuneration guide-lines if material changes are needed or at least every fourth year and present the guidelines for the General Meeting to resolveupon.Theseguidelinesaretobeapplicablefromthetime of the General Meeting’s approval of them, until new guidelineshavebeenresolved(andfouryearsatmost).TheRemuneration Committee may seek approval of new guide-linesatanearlierpointintimeifcircumstancesaffectingthepurposeoftheguidelinesarise.

The Remuneration Committee shall also follow-up and evaluate programmes for variable remuneration to senior executives, the application of the remuneration guidelines andcurrentremunerationstructuresandlevelsinNobia.Themembers of the Remuneration Committee are independent in relationtothecompanyandcompanymanagement.

Taking into account salary and employment terms for employeesThe Remuneration Committee’s preparations of the Board’s proposal regarding guidelines for salaries and other employment conditions for Group management considered information on total employee remuneration, the compo-nents of remuneration and the increase and rate of increase in remuneration over time as part of the Committee’s and the Board’s basis for decision on producing and evaluating the fairness of the guidelines and the limitations accompa-

nyingthem.Thetrendinthegapbetweenremunerationtothe President and remuneration to other employees will be presentedintheannualremunerationreport.

Forms of remunerationRemuneration must be market-based and may comprise the following components:• Fixed cash salary• Variable cash salary• Pensionbenefits• Otherbenefits

TheGeneralMeetingcaninadditiontothat–andindepen-dentoftheremunerationguidelines–decideon,forexam-ple,shareandsharepricerelatedremuneration.

Fixed cash salary Remuneration is to be based on the individual executive’s areasofresponsibility,experienceandperformance.Thefixedcashsalarywillbereviewedannuallytoensurethatthesalaryismarket-basedandcompetitive.

Variable cash salaryVariableremunerationcanbepaidinadditiontofixedremu-neration.Variablecashremunerationshallbeconnectedtopre-determinedandmeasurablecriteriathatcanbefinan-cialornon-financial.Thecriteriacanvaryfromyeartoyear

Guidelines for remuneration

Form of remuneration Link to company strategy Implementation Opportunity/evaluation

Fixed cash salary Thefixedcashsalaryreflectsthe individuals’ role, experi-ence and contribution to the company.Thelevelforfixedcash salary aims to contrib-ute to recruitment and enable long-term retention of senior executives.

Evaluatedyearly.Adjust-ments during the year can be madeiftherolechanges.

Adjusted to the market lev-els for the role and country of business.Levelsareadaptedafter evaluation of the indi-vidual’sperformance.

Variable cash salary To promote goal achievement or over achievement of the company’s pre-determined financialandnon-financialcriteriasuchasprofitabilityandcashflowrevenueandimportant operative, strategic or other sustainability-related measures.

At the end of the vesting period (at least 12 months) the Remuneration Committee evaluates to what extent the criteria for payment of vari-able cash salary has been met.

Fulfilmentofcriteriafordefinedgoals.

Pension and other benefits

Benefitsforseniorexecutivesarepartoftheabilitytooffera competitive total remuner-ation, in order to facilitate recruitment and retention of the company’s senior execu-tives.

Isofferedduringthetimeofemployment and is subject to review dependent on fac-torssuchasage,leveloffixedcashsalaryandrole.

Based on market practice and market levels for the role in question and the country ofbusiness.

Sustainability-related measures linked to the company’s business strategy

Nobia’ssustainabilityeffortsareevaluatedandratedcontinuallyby,amongstothers,investors,analystsandcivilsocietypartici-pants.Hence,thecompany’smethodsandresultsarereviewedandcompared.Asaresult,thecompany’ssustainabilityeffortscanbecontinuouslydevelopedinlinewiththedemandsofitsstakeholders.ThesustainabilityeffortsareanintegratedpartofNobia’sbusi-nessthatcanstrengthenNobia’sbrandandcontributetoanincreaseinvalueofNobia’sshares.



toreflectbusinesspriorities,andusuallyincludeabalancebetweentheGroup’sfinancialperformance(forexample,profitabilityandcashflowrevenue)andnon-financialper-formance criteria (for example, important strategic or other sustainability-relatedmeasures).Bythiswayofapplyingpre-determinedfinancialandnon-financialperformancemeasuresthatreflectNobia’sbusinesspriorities,Nobiacon-siders the possibility of attracting, motivating and retaining key employees to be improved, which contributes to Nobia’s businessstrategy,long-terminterestsandsustainability.

Whenthevestingperiodforfulfilmentofthecriteriafor payment of variable cash salary is closed an assess-ment is to be made as to what degree the criteria have been met.TheRemunerationCommitteeisresponsibleforsuchan assessment with regard to variable cash salary attribut-abletothePresidentandotherseniorexecutives.Duringtheannual evaluation, the Remuneration Committee can adjust the targets and/or remuneration for extraordinary events (both positive and negative), reorganisations and structural changes.Fulfilmentofthecriteriaforpaymentofvariablecash salary shall be measurable during a vesting period ofatleast12months.Thecriteriaaremeasuredonbothanannualandaquarterlybasis.

The variable cash salary for the President and other seniorexecutivesmayamounttoamaximum65%ofthefixedannualcashsalary.Beforevariablecashsalaryisdis-bursed, the Board of Directors shall assess the reasonable-nessoftheturnout.ThisassessmentismadeinrelationtoNobia’sprofit/lossandfinancialposition.Thecompanyshall have the right to reclaim variable components of remu-neration that were awarded on the basis of information whichsubsequentlyprovedtobemanifestlymisstated.

Pension benefitsThe President and other senior executives employed in Sweden areentitledtopensionsundertheITPsystemorequivalent.Inaddition to the ITP system, senior executives in Sweden may be entitled to, after resolution by the Board, an expanded premium- based pension right on salary portions exceeding 30 base amounts.Furthermore,thecurrentPresidenthasapensionpre-miumincludinghealthinsurancefor30%ofafixedyearlysal-ary.Forseniorexecutives,pensionbenefitsmaynotexceed35%ofthefixedcashsalary.Theseniorexecutive’smemberswhohave employment contracts under the terms of another country have pension solutions that are in agreement with local practice; in doing so, the principles in these guidelines will be complied withasfaraspossible.

Other benefitsOtherbenefitscaninclude,interalia,lifeinsurance,healthcareinsuranceandcompanycar.ThePresidentandotherseniorexecutivesarefurtherentitledtobenefitsthatcouldbeofferedtootheremployeesatanygivenmoment.

Additionalbenefitsandadditionscanbeofferedundercertain circumstances, for example, in case of re-allocation orinternationalassignments,inwhichcasebenefitsandremunerationaredeterminedaccordingtolocalconditions.

ForGroupmanagement,otherbenefitsmaynotexceed10%ofthefixedcashsalary.Withregardtoemploymentconditions governed by other rules than Swedish, as far as pensionbenefitsandotherbenefitsareconcerned,appro-priate adjustments may be carried out to comply with com-pulsory laws or local practice, whereupon the guidelines’ overallpurposesaretobesatisfiedtotheextentpossible.

Termination of employmentIn case of termination by the company, the termination notice periodshallnotexceed12months.Fixedcashsalaryduringthetermination notice period and termination consideration com-binedshallnotexceedanamountequivalenttotheyearlyfixedcashsalaryforthePresidentandotherseniorexecutives.Incaseof termination by the employee, the notice termination period may amount to a maximum of six months, without right to termi-nationconsideration.ThePresidentandotherseniorexecutivesmay have a right to accrued variable cash salary, however not foraperiodexceedingtheperiodoftheemployment.

Disclosures regarding share-related remuneration schemesNobia has inaugurated long-term share-related remunera-tionschemes.Theprogrammes,whichencompass,interalia,Group management, senior executives and persons in senior management, were resolved upon by the General Meeting and are therefore not covered by guidelines for remuneration toseniorexecutives.Theperformancerequirementsthatareused to assess the outcome of the programmes has a clear link to the business strategy and in this way to Nobia’s long-termvaluecreation,includingtheGroup’ssustainability.Theperformancerequirementsencompass,forexample,profit-abilityandtotalshareholderreturn.Theprogrammesimposefurther requirements on own investment and a certain vest-ingperiod.Beforethenumberofsharestobeallocatedundertheprogrammeisfinallyestablished,theBoardmustcheckthe reasonableness of the outcome of the long-term remu-nerationscheme.Formoreinformationonproposedlong-term remuneration schemes and the criteria that the outcome dependson,referto[linktocompleteproposal,AGM2021].

Remuneration to the BoardIf a Board member carries out work on behalf of Nobia in addition to their Board duties, a consultant fee and other remunerationcanbepaidforsuchwork.Decisionsonsuchconsultant fees and such other remuneration are made by theRemunerationCommitteeandshallbemarket-based.

Deviation from the guidelinesThe Board of Directors may decide to temporarily, wholly or partially, deviate from the guidelines if there are special cir-cumstances in an individual case and deviation is neces-saryinordertoensurethecompany’sfinancialcapacity.Asstated above, the Remuneration Committee is responsible for preparation of the Board of Directors’ decisions on remu-neration matters, which includes decisions on deviation fromtheremunerationguidelines.

Proposed appropriation of profitsThefollowingprofitsintheParentCompanyareatthedis-position of the Annual General Meeting:

Sharepremiumreserve 52,225,486Unappropriatedprofitbroughtforward 1,233,554,474Netlossfortheyear -207,482,212Total SEK 1,078,297,748

TheBoardofDirectorsproposesthatallprofitsatthedispo-sition of the Annual General Meeting be appropriated as follows:

Ordinary dividend of SEK 2 per sharetobepaidtoshareholders 337,705,642Tobecarriedforward 740,592,106Total SEK 1,078,297,748



Risks, Risk management and opportunitiesNobia is exposed to a number of strategic, operational, compliance and financial risks that could impact our abil-ity to achieve business objectives into the future. Nobia’s Enterprise Risk Management framework and internal con-trol environment are designed to manage these risks.Risk management is by its nature a dynamic and ongoing process.Ourwell-definedapproachisflexibletoensurethatit remains relevant at all levels of the business, and dynamic to ensure we can be responsive to changing business condi-tions.ThisisparticularlyimportantgiventhediversityoftheGroup’slocations,marketsandproductionprocesses.Man-aging risks is a part of conducting business, consequently Nobiastrivestoensurethattheriskstakenaredeliberate.Itisimportant for us to understand the risks to which our business isexposedandmakeinformeddecisions.Groupmanage-mentreportsriskissuesonanongoingbasistotheBoard.

The coronavirus pandemic will continue to increase uncertaintyintheglobaleconomytoahighlysignificantdegree.Themeasuresimposedbydifferentgovernmentsto prevent the spread of the pandemic might weaken the economy and consumer purchasing power in all of Nobia Group’smarketareas.Theinfectionsituationhaswors-ened in many countries, and a prolonged pandemic may weaken demand for some of our products although Nobia benefitedfromthestayathometrendespeciallyintheNor-dicandCentralEuropeRegions.Thepandemicmayalsocausesignificantdisruptioninvarioussegmentsofouroper-ations, thereby threatening the continuity of business and customerservices.Theultimateimpactontheworldecon-omy and on Nobia Group’s business operations will become apparent only as the pandemic unfolds and over a longer period.

Risks related to climate change and sustainability remain an integral part of a number of our principal risks

including brand, reputation and trust, and responsible sourcing,supplychainandproductmanagementprocess.

Nobia's risk management frameworkNobia has an established process for Enterprise Risk Man-agement (ERM) that provides a framework for the Group’s riskactivities.ThepurposeoftheERMprocessistoprovidea Group-wide overview of Nobia’s risks by identifying them, evaluating them and providing a basis for decision-making regarding the management of risks, and to facilitate monitor-ingoftherisksandhowtheyaremanaged.Internalcontrolsusedtomanagetherisksassociatedwithfinancialreportingare presented in the Corporate Governance Report on page 102.

Sustainability and climate-related risks are integrated inouroverallbusinessriskassessmentprocess.Workers'health and safety risk assessment processes are integrated inlocalmanagementsystems.

ThisreportaddressestheGroup’sprincipalrisks.Nobia’sriskmanagementprocessconsistsoffivestages

andisdescribedinmoredetailbelow.

The aim of our risk management is to cre-ate awareness of risks and consequent-ly limit, control and manage them and le-verage the opportunities.

Jon Sintorn, CEO

Risks and risk management


Nobia's risk management process

Strategy & AppetiteThe Board has overall responsibility for setting the Group’s strategy and is responsible for monitoring and maintaining theeffectivenessoftheGroup’sriskmanagementactivitiesandinternalcontrolprocesses.Inordertoassistindetermin-ing the Group’s risk appetite a risk rating matrix has been developed which considers both the likelihood and the mag-nitudeoftheimpactiftheriskeventoccurs.Theriskrat-ing matrix is based on the residual risk that the Group faces after considering the internal control environment and other mitigatingfactors.

Risk identification Nobiautilisesastructuredriskandcontrolidentificationpro-cesstoidentifyrisk.Thebasisforthisidentificationprocessisan annual workshop with both a bottom-up and a top-down method.AllRegions,Divisionsandfunctionsarerequiredtoregularly conduct a detailed review to identify material risks inherent and compile a risk register which is reviewed and approvedbytheRegionalManagementTeam.TheGroupreviews the most material risks on a regular basis and identi-fiestheriskstheyaremanagingatGrouplevel,whichisthenreportedtotheBoard.

Risk assessment Risk assessment is a natural part of the day-to-day business and risk assessments form part of all investment decisions andhowweconductourbusiness.Nobiautilisesastruc-tured risk assessment process that is carried out by the Busi-ness Units and functions in accordance with the minimum

standardsestablishedbytheInternalControlfunction.Principal risks is reviewed in detail by the Audit Committee through the course of the year, considering the detailed risk description, the controls and mitigating actions in place and theresultantresidualriskexposure.

Risk treatment The risk management process ensures that the vari ous Busi-ness Unit management teams review the principal risks in their respective businesses and identify the actions and con-trolsinplacetomitigaterisk.Managementassuranceispro-vided on both a formal and informal basis, and risk man-agement is embedded in all decisionmaking processes, with ongoingreviewbytheBoard.ActionplansaredevelopedforidentifiedrisksandlinesofbusinessandGroupcompaniesare held accountable for tracking and resolving issues in a timelymanner.

Risk Monitoring Nobiastrivesforcontinualimprovementthrougheffortstoenhance controls, ongoing employee training and develop-ment,talentretention,andothermeasures.Riskreportsareproduced on a Group-wide basis as well as by line of busi-nessandGroupfunctions.Reportingincludestheevaluationof key risk indicators against the established stated risk appe-tite.TheAuditCommitteeperformsanannualreviewoftherisk management policy and plan, including consideration ofacceptablerisktolerancelevelsfortheGroup.In2021,theCommittee will continue to focus on the principal risks to the Groupandtheactionstakentomitigatetheserisks.

Risk strategy risk appetiter

Risk treatment

Risk monitoring

Risk assessment

Risk identification



Nobia Group Principal Risks

A risk universe consisting of four categories and over twenty riskareasisusedtoaggregateandcategorizerisksidentifiedacross the organization within the risk management frame-work.Overthecourseofthepastyear,theauditcommitteehasreviewedtheprincipalriskssetoutbelow.Inevaluatingthe Group’s risk management and internal control processes, the audit committee has considered established practicies withinEnterpriseRiskManagement.Thesustainabledevelop-

ment risks are considered throughout our business and con-solidatedintotheprincipalriskswhererelevant.

Risk management is an integrated part of our business planningprocessandmonitoringofbusinessperformance.Risksanduncertaintiesthatcouldspecificallybeimpactedby Nobia’s operations include, but may not be limited to the following:

Financial risks

Risks that can cause unexpected variability or volatility in net sales,

margins, earnings per share, returns or market capitalisation.

Legal & regulatory risks

Risks related to legal or governmental actions that can have a material i

mpact on the achievement of businessobjectives.

Strategic & emerging risksRisks that can have a material

impact on the strategic objectivesarising from internal or

externalfactors.

Operational & societal risks

Risksthatmayaffectorcompromise execution of business functions or

haveanimpactonsociety.



Strategic & emerging risks

Risk area: Description: Management:

Political and macroeconomic risk

Demand for Nobia’s productsisaffectedbygen-eral macroeconomic trends and the subsequent fluctuationsinitscustomers’purchasingpowerandconsumptionpatterns.Macroeconomicorpolitical decisions and events around the world impact Nobia’s operations, both locally and on a globalscale.Politicaluncertaintyandweakmacro-economicconditionscanindirectlyaffectdemandforkitchens.Businessriskslinkedtopoliticaldeci-sions on restrictions, for example, related to trade tariffsorreducedfreedomofmovement,alsoresultin more expensive import, less competitive export andordercancellations,etc.

Nobia has sales in the Nordic region, the UK, Netherlands and Austria and purchases raw mate-rialsandcomponentsfromEuropeandAsia.Aspart of its normal business operations, Nobia has extensive accounts receivable and accounts pay-able,whichareaffectedbyaccesstoliquidityintheglobaleconomy.Changesinglobalpoliticsand the macro economy could have a material impact on Nobia’s income, operating margin and financialposition.

For all its operations, it is important that Nobia endeav-ourstomanagetheeffectofforthcomingeconomicfluctuationsbytakinganumberofmeasures.Examplesof these measures are reducing costs, reviewing capac-ity and production structure and creating higher cus-tomervaluethroughproductinnovation.

Nobia works continuously to monitor, evaluate and attempt to predict changes in the business environment in the form of political decisions and changes to rules in the areas that are particularly important to its oper-ations.Nobiaisactiveinvariousnationalandinterna-tional trade associations and in other types of partner-ships.Thepurposeistogainearlyknowledgeofandactively contribute to the development of areas that areimportanttothecompany’soperations.Accord-ingly, Nobia needs to take proactive measures to assess andmanagetheserisks.Uncertainties(includingBrexit)and macroeconomic conditions impact our customers’ budgets and force customers to reappraise the con-ceptsofvaluethusaffectingNobianegatively,howeverNobia has a structured approach and proactively ini-tate counteractive measures which have shown to been effectivein2020.

Not meeting customers demand and preferences

Global socio-economic and demographic trends and changing consumption patterns, including increased public awareness of sustainability and increasing customer purchasing power, are driving changes in customers’ needs and attitudes, and couldaffectthedemandforNobiaproducts.

Demand for Nobia’sproductsisaffectedbygen-eralmacroeconomictrendsandtheresultingfluc-tuations in its customers’ purchasing power and consumption patterns, whereby prices, the number of transactions in the housing market and access tofinancingarekeyfactors.

Digitalisation is also changing customer and con-sumerbehaviour,preferencesanddemand.Fur-thermore, greater climate awareness is starting to changecustomerexpectationsanddemands.

Nobia’s focus on customer and consumer insight guides its innovation activities, ensuring that new products, services are competitive and positioned in the relevant saleschannels.KeysuccessfactorsforNobia’slong-termgrowthandprofitabilityareourabilitytoofferattractive, innovative and sustainable products, ser-vices and brands and to make these available to cus-tomersandconsumersovertheproductlifecycle.

Continuous investments in research and development to develop products and designing products with a life cycle perspective in line with customer demand and expectations,evenduringeconomicdownturns.Nobiaalso places great importance on developing processes, products and information to ensure customer satisfac-tion,forexample,byofferingeco-labelledproductsandensuring that the products we produce and the mate-rials we use comply with our own and our stakeholders’ standards.

Nobia is participating in the increasing digitalisa-tion trend and its impact on customers, consumers and channels, for example, through online sales, which has duetotheCoronavirusincreasedsignificantly.

Delay or failure in identifying and effectively responding to the challenges of a post-Brexit environment

The UK exited the EU on January 31, 2020, and the transition period concluded on December 31, 2020.InDecember2020,theUKandEUannouncedthey had entered into a post-Brexit deal on certain aspects of trade and other strategic and political issues.AswemaintainsignificantoperationsintheEU, the terms of the December 2020 post-Brexit deal couldsubjecttheCompanytoincreasedrisk.Weare in the process of evaluating the impact of the December 2020 post-Brexit deal on our business, futureoperations,operatingresultsandcashflows.The UK is an important market for Nobia and rep-resentsapproximately40percentofnetsales.

We continue to monitor Brexit and its potential impacts on our results of operations, business, financialcondition,orprospects.Ourflexibilitywithin the organization enables us to timely react with structural and operational changes as may be appropriate.

Currently, the vast majority of the operational actions necessary to respond to this scenario have been implemented including, but not limited to: pre-cautionarymeasuressuchasincreasingbufferstock of critical components to avoid interruption in production.

Nobia is expected to have continued consider-ablenetsalesintheUK.Nobia’sfixedassetsintheUKamountto27%ofNobia’stotalfixedassets.



Financial risksRisksthatcancauseunexpectedvariabilityorvolatilityinnetsales,margins,earningspershare,returnsormarketcapitalisation.


Credit control failure

Credit risk pertains to losses owing due to Nobia’s customersorcounterpartiesinfinancialcontractsfailingtofulfiltheirpaymentobligations.

The Group’s financial policy for managing finan-cial risks which includes Credit control and Currency effects has been prepared by the Board and forms a framework of guidelines and rules in the form of risk mandates and limits for the finance operations. Credit risk in accounts receivable is managed through credit checks of customers using credit rating compa-nies.AGroup-widecreditriskpolicysetsthelimitsforanygivencustomer.Thecreditlimitissetandregularlymonitored.Forfurtherinformationconcerningaccountsreceivable and recognition of expected credit losses, see Note2Financialrisks.

Financial credit risk Nobia strives to enter into agree-ments that allow net calculation of receivables and lia-bilities.Incertaincases,therearealsosupplementaryterms to these agreements regarding the exchange of collateral.

Currency effects

Transaction exposure Transaction exposure is the risk that exchange rate movements in export revenues and import expenses could negatively impact the Group’soperatingprofitandthecostoffixedassets.

Translation exposure Translation exposure is the risk to which Nobia is exposed when translating foreign subsidiaries’balancesheetstoSEK.

Transaction exposure Derivative instruments are held only for hedging purposes and not for speculative trans-actions.Nobia’soverallstrategyistoreducetheGroup’sexchangerate exposure linked to forecast purchases and sales of goods and uses derivative instruments in theformofcurrencyforwardcontractsforthispurpose.During the year, primarily accounts receivable and pay-able, as well as future payments of non-current assets werecontinuouslyhedged.

Translation exposure Nobia manages translation expo-sure by distributing the liabilities across various curren-cieswheretheGroupownsassets.Translationexposurein the income statements of foreign subsidiaries is not currencyhedged.

Fordetailedinformationconcerningfinancialrisks,see Note2.

Strategic & emerging risks (cont.)


Investments in Business transformation and future growth

To support Nobia’s revised strategy, we are cur-rently investing in business transformation and future growth through, for example, initiatives to increase competitiveness and reduce cost as well astoimprovecapacityanddeliverytime.Anewfactory is built in Jönköping which requires capital and to support the revised operating model a new ERPsolutionisdeveloped.

Failure to to attract and retain people with right skills to execute our transformation objectives due topoorcompetence,prioritisation,ineffectivechange management and a failure to understand and deliver the technology required, results in an inabilitytoprogresssufficientlyquicklytomaintainorincreaseoperatingmarginandgeneratesuffi-cientcashtomeetbusinessobjectives.

Management constantly reviewsandrefinesthebusiness plans, and take other actions in order to effectivelyexecuteonbusinessstrategy.Wehaveclearmarketstrategiesandbusiness

plans to address changes to business priorities, stra-tegicobjectivesandexternalmarketfactors.Inaddi-tion, we have executive-level governance and over-sight for all the transformation activities to ensure programmes are adequately resourced, milestones achievedandtoapprovekeyrolloutdecisions.



Legal & regulatory risksRisksrelatedtolegalorgovernmentalactionsthatcanhaveamaterialimpactontheachievementofbusinessobjectives.


Legal and compliance risk

Legal Risk Legalriskscompriseanumberofrisksin,tosomeextent,diverseareas.Amendedlegisla-tion, violations of laws in the operations or errors in any agreements signed by Nobia, are some exam-plesoflegalrisksthatcouldhavenegativefinancialandreputationalimplicationsforNobia.Incertaininstances, they may also result in protracted and costlylegalprocesses.

Compliance risk Non-compliance with the legal and governance requirements and globally estab-lished responsible business conduct in any of the jurisdictions in which we operate and within our sup-plychaincouldexposeustosignificantriskifnotactivelymanaged.Failuretosuccessfullyman-age relationships with our stakeholders could dis-rupt Nobia’s operations and adversely impact the Group’sreputation.

These requirements include laws relating to the environment, price controls, taxation, competition compliance, data protection, human rights, workers health&safetyandlabourrights.

More stringent environmental requirements, reme-diation of the environment in connection with plant closures or breaches of permits could incur higher costsfortheGroup.

There is a growing demand from investor and reg-ulatory communities for improved disclosures from companies in relation to diversity and climate-re-latedrisks&opportunities.

Nobia constantly monitors developments in sev-eral areas and addresses any legal risks that arise in co-operationwithexternaladvisers.Bytheirnature,legal issues are often national, which means that local experts are also often engaged by Nobia in various issues.

A corporate culture that protects integrity is a prereq-uisite for our reputation and our ability to be an attrac-tiveanddevelopingworkplace.Ourcodeofconductisbased on principles for environmental, social and eco-nomicsustainability.Thecodestatestheminimumlevelofacceptablebehaviorforallemployeesandpartners.WehavedevelopedandoperatesaCodeofConducttrainingprogramme,supportedbyself-certificationandreporting.Inaddition,allnewhiresmustcompletetraining in the Code of Conduct shortly after joining thecompany.Duringtheyearwehaveupdatedourcode of conduct, focusing on, for example, the impor-tanceofalongtermsustainablebusinessmodel.

Nobia has a comprehensive programme with policies and guidelines on compliance with applicable compe-tition,anti-corruptionanddataprotectionlegislation.Our legal and governance compliance is supported by a centralised co-ordination of compliance related mat-ters.Allentitiesmustperformaself-assessmentwhichincludes questions relating to corruption, when review-ing the evaluations for 2020, nothing emerged that indi-catedanyincreasedriskofcorruption.Ongoingandpotential environmental risks are regularly monitored inouroperations.Severalkeyperformanceindicators(KPIs) that address resource and energy usage in order to minimise costs and impact on the environment have been developed and are regularly monitored by the managementteam.

Operational & societal risksRisksthatmayaffectorcompromiseexecutionofbusinessfunctionsorhaveanimpactonsociety.


Competition

Failure to deliver an effective, coherent and con-sistent strategy to respond to our competitors and changes in market conditions results in a loss of mar-ket share and failure to improve profitability.

Nobia operates in mature markets, which means that underlying demand in normal market circumstances isrelativelystable.Notwithstandingthis,Nobiaissub-ject to considerable competition from other producers ofsimilarproducts.

Nobia’s products to the retail market are sold through digital & online channels as wells as in own stores and franchisesretailers.Salestoprofessionalcustomersareconducted with regional and local construction com-panies via a specialised sales organisation or directly throughthestorenetworkoronline.Iftheseplayersarenot successful in selling Nobia’s products, it could have a negativeimpactonNobia’searnings.

As regards to competitors, we regularly review mar-kets, trading opportunities, competitor strategy and activityandweareabletoquicklyrefineourcustomerproposition.Nobiafollowsuponnewplayersinthemar-ketandtheirimpactonthecompany.

The company works to maintain strong and long-term customer relationships in strategic customer segments, andbuildingrelationshipswithnewcustomers.

Nobia has a structured and proactive method for followingdemandfluctuations.Robustmeasuresand cost saving programmes for adjusting capacity have proven that Nobia can adjust its cost level when demandfortheGroup’sproductsdeclines.

Nobia's proactive approach during the pandemic thus far, there has been little impact on the Group's abilitytoservecustomersandrunoperations.TheGrouphasaccelerateditseffortsonsalesandcus-tomerservicethroughdigitalandonlinechannels.




Information technology risks

The Group relies on IT systems in its day-to-day oper-ations.Disruptionsorfaultsincriticalsystemshaveadirectimpactonproduction.Errorsinthehandlingoffinancialsystemscanaffectthecompany’sreportingofresults.

Cyber security risks are increasing in importance and couldhaveamajorimpactonNobia’soperations.Theftof personal information or failure to comply with legal or regulatory requirements relating to data security and data privacy in the course of our business activities, can resultinreputationaldamage,finesorotheradverseconsequences.Theftormodificationofintellectualpropertyconsti-

tutesarisktoourproductsandfuturebusinesssuccess.

Nobia has a global IT security policy, including quality assuranceproceduresthatgovernIToperations.Thesystem landscape is based on well-proven products and the IT landscape is subject to continuous invest-mentsinordertoremainuptodate.

Continuous investment in our cyber defence pro-gram including development of cyber security skills and improved technology and processes for scanning, monitoring and logging to identify intrusion and detect anomalousdatatraffic.

Awareness of cyber security risks increases the readi-nesstoquicklyaddressanyattacks.

Technical integrity of our operating assets

We have three major production facilities which accountforapproximately75%ofourtotalproductioncapacity.

If operations at any of these key facilities are inter-ruptedforanysignificantlengthoftime,itcouldhaveamaterialadverseeffectonNobia’sfinancialpositionorperformance.Incidentssuchasfires,explosions,orlargemachin-

ery breakdowns or the inability of our assets to per-formtherequiredfunctioneffectivelyandefficientlywhilst protecting people, business, the environment and stakeholders could result in property damage, loss of production, damage to reputation, and/or safety and environmentalincidents.

Our capital investment programme supports the replacement of older equipment to improve both reliabil-ity and integrity, and our proactive repair and mainte-nance strategy is designed to improve production reli-abilityandminimisebreakdownrisks.Weconductriskassessments of our high-priority equipment and have specificprocessesandproceduresinplacefortheongo-ing management and maintenance of such equipmentWeactivelymonitorallincidentsandhaveafor-

mal process which allows us to share lessons learned across our operations, identify emerging issues, con-ductbenchmarking,andevaluatetheeffectivenessofourriskreductionactivities.OurfireProtectionpro-gramme is supported by external experts and indepen-dent loss prevention audits,we take out property insur-ance cover for key risks and facilities are normally protectedbysprinklersystems.

Environmental impact and climate change

Climate change hasthepotentialtoaffectourbusinessinvariousways.Whilethesemaynotbesevereintheshort term, we believe climate change related risks are likely to have a medium and long-term impact on our busi-ness.Woodensheetmaterialisthemainrawmaterialforour products and forests are an important carbon store, with sustainably managed forests having the opportu-nitytosupportacircularbioeconomy.Customersandconsumers are increasingly concerned about the conse-quences of climate change and are looking for solutions produced from renewable materials and reduced carbon footprints.Ourclimatechangerelatedrisksrelatetotran-sitionandphysicalrisks.

Governments and regulators are likely to take action tocurbcarbonemissionsthatmayimpactourbusiness.Changes in precipitation patterns and extreme weather conditionssuchasfloods,storms,droughtsandfiresmayimpact our supply chain and the forests our suppliers source wood from and could result in supply chain inter-ruptionsandhigherwoodcosts.Highertemperaturesmayalso increase the vulnerability of forests to pests and dis-ease.Increasedseverityofextremeweathereventsmayalsointerruptouroperations.

Furthermore, there are risks linked to a lack of control of, for example, serious environmental incidents and unfore-seendemandforenvironmentallycertifiedproducts.

Sustainability risks and climate-related risks are inte-grated into the Group’s overall process for assessing operationalrisks.Riskassessmentispartofourmateri-ality process for identifying our most material sustainabil-itytopics.

Through our internal sustainability system, we iden-tify, manage and follow up on important sustainabil-itytopics,includingrisks.Sustainabilitymanagementis integrated into central processes such as sustainabil-ity scorecard in product development and assessment andevaluationofsuppliersintheprocurementprocess.

Through local environmental management sys-tems, preventive measures are managed at each pro-ductionplant,includingemergencypreparedness.

See also further information on climate-related risksonpage58,TaskForceonClimate-RelatedFinan-cialDisclosures(TCFD).

Operational & societal risks (cont.)Risksthatmayaffectorcompromiseexecutionofbusinessfunctionsorhaveanimpactonsociety.




Attraction and retention of key skills and talent

Our success isdrivenbyourpeople.Keytoourlong-term success is attracting, retaining, recruiting and developingaskilledandcommittedworkforce.

Access to the right skills, particularly management and technical skills, is critical to support the perfor-manceandgrowthofourbusiness.Losing skills or failing to attract new talent to our

business has the potential to undermine our ability to drive performance and deliver on our strategic objec-tives.

Failure to meet safety standards in relation to our workplace, results in death or injury to our custom-ers, colleagues or third parties and ultimately adverse financialandreputationalconsequences.

Our culture and values play a key role in empowering andinspiringourpeople.Thesearehighlightedbyvari-ous programmes and collaboration initiativesthroughoutouroperations.Wehaveazerotolerancepolicy towards discrimination and we provide equal opportunitiesforallemployees.

To attract skills and talent we are investing in employer branding; we are engaged in fair and transparent recruitmentpractices.Weensurethatwehavecompet-itive remuneration for the position and country of oper-ationinquestion.Inaddition,inordertosupportcareerdevelopment we ensure that employees have access to training and development, through on-the-job train-ing, internal training, external seminars and training programs.

The Group regularly assesses and manages safety andhealthrisksinoperations.Allunitsconductsys-tematic health and safety work in which every work-place accident is analysed, and measures are taken topreventasimilaraccidentfromhappeningagain.Moreover,fiveofour14productionplantshavecerti-fiedmanagementsystems,OHSAS18001orISO45001,and additional two plants are awaiting updated certi-fication.Routinesandprocesseshavealsobeenimple-mented at other plants for both monitoring and esca-latingworkplaceaccidents.

Cost and availability of raw materials

Access to sustainable sources of raw materials is essentialtoouroperations.TherawmaterialsusedbytheGroupincludesignificantamountsofwood,steel,aluminiumandplastics.Woodpricesandavailabilitymaybeadversely

affectedbyreducedquantitiesofavailablewoodsupply that meet our standards for credibly certi-fiedorcontrolledwood,theimpactofclimatechangethrough increased frequency of severe weather events, changes in rainfall or increased instances of pest and disease outbreaks and increasing use of woodasabiofuel.

Cost variations for components (such as handles, worktops and hinges) and goods for resale (such as appliances) are mainly caused by changes in the com-modity prices of raw materials in the global market or suppliers’abilitytodeliver.

Risk of delivery disruptions Nobia purchases material and components from Europe, including Northern Italy andAsia.Disruptionstosubsuppliers’abilitytodelivergoods to Nobia, as a result of both global and local distributions, could lead to delays to Nobia’s deliveries toitscustomers.Deliverydelayscouldariseforavari-ety of reasons, for example, extreme weather condi-tions,pandemicsorpoliticaldisruptions.Suchdelayscould result in costs, loss of income and a tarnished reputation.

We are committed to acquiring our raw materials from sustainableandresponsiblesources.Weworkcontinu-ally with our suppliers to increase the share of recycled materials and we encourage legislation supporting the localcollectionofrecycledmaterials.Wehavemultiplesuppliersforeachofouropera-

tions and our centralised procurement teams work closely with our operations in actively pursuing longer termagreementswithstrategicsuppliers.Wesourceour wood from diverse regions to mitigate the potential impactsofclimatechangeonourwoodsuppliers.Efficiencyimprovementsinthecompany’soper-

ations,changedproductspecificationsandpriceincreases are examples of measures to reduce the effectofrisingcostsforinputgoods.

The impact of the pandemic on the Group’s sourcing andlogisticshasnotbeensignificantsofar.Suppliersof some products have adjusted their operations and in some cases announced price increases , which is why the availability situation and the availability of alterna-tive products are monitored and ensured in coopera-tionwithsuppliers.Changesinthepandemicsituation,aswellasordersissuedbytheauthorities,mayaffecttheavailabilityofsomeproducts.Sofar,theGroup’slogistics chain and customer deliveries have been oper-atingalmostnormally.



GovernanceThe Board of Director’s of the Nobia Group bears the ultimate respon-sibility for the management of all Nobia’s risks and opportunities, whichincludesclimaterelatedrisksandopportunities.Climateactionplays a central role in our sustainability strategy and we have adopted aScienceBasedClimateTarget,approvedbytheSBTi.TheBoardofDirectors monitors progress in implementing climate change mitiga-tion and/or adaptation strategies, oversees risk & opportunities and targetsaspartofitsreviewoffinancialandnon-financialresultsanditsevaluationofoperationalmanagement.

The CEO, is the President of the Group Management, which is the highest organizational function with responsibility for the Nobia SustainabilityStrategy.TheCEOisoverseeingrisks&opportuni-ties, including economic, social and environmental topics, such as climatetargets.TheEVPandChiefProductSupplyOfficerisresponsiblewithin

the Group Management for all operations, product management, group sourcing, and sustainability, including climate related risks and opportu-nities.HeadofSustainabilityispartofthemanagement team for Product Supply and is leading a central sustainability functionatGrouplevel.

Seealsopage103,118,119.

StrategyNobia develops strategy and plan the organisation's business activities based on, among other things, the outcome of materiality and risk assessment process, including climate adaptation and mit-igationassessments.

As a result of our assessments, risks in a short term perspective include challenges related to reduced sales due to lack of envi-ronmentalproductcredentials.Inamediumtolongtermperspec-tive we include risks such as increased direct costs for wood due to higher demand for fossil free materials, increased demands for wastereduction,cleanermaterialflowsaswellasrequesttoassuredecreased fossil fuel dependence, but also emerging regulation andrelatedcarbonpricingmechanisms.Ournewlyadoptedsustainabilitystrategyfor2021-2026,

addresses such risks, by for example including a science-based CO2 reduction target that covers our own fossil fuel consumption and

direct emissions from heating and own transport, as well as CO2reductionsinthevaluechainofourproducts.This

strategy also includes managing emissions in our value chain, such as transportation of goods,

emissionsfromourproducts,etc.Impact of potential and future regula-tory changes as well as increased cost

for direct material is part of our Enter-prise Risk Management process.

Seealsopage32-33.

Risk & opportunity managementNobia has an established process for EnterpriseRiskManagement.

Sustainability and climate-related risks are integrated in our overall business risk assessmentprocess.Werecogniseinvestorsand other stakeholders are seeking a better under-standing of how companies are evaluating and respond-ingtoclimatechangerelatedrisks.Wehavebeenevaluatingtheimpact and reporting on these risks for a number of years and therefore included climate change related risk in the yearly Top Risk Assessmentactivitywiththegoaltoidentifyandremediatesignifi-cantthreatstofinancialresults,operationviability,reputationandthe delivery of key strategic objectives, regardless of whether they canbequantifiedornot.Inaddition,identifyingemergingriskswhich may arise from technological development, new or chang-ingsenvironmentalrisksareavitalpartinourERMprocess.

Seealsopage50-57.

Metrics and Targets

As part of our new sustainability strategy we have set a science-based

target to reduce our CO2 emissions fromscope1and2by72%froma2016

baseyear.Wealsoincludeourvaluechainbycommit-

ting that 70 % of our suppliers by emissions cov-ering purchased goods and services and use of prod-

uctswillhavesciencebasedtargetsby2025.Further, we want to help reduce our customers’ energy consump-tionfromwhitegoods,bytransitioningourwhitegoodsportfolio.

Result 2020:Renewable electricity : 100 %Renewableelectricityandheating:88%Thisyear'sscope1&2reduction:18%Scope1&2tonCo2/NetsalesSEKm:0,85

Seealsopage32-33,120.

Task Force on Climate-related Financial Disclosures (TCFD)

NobiawantstohelpfulfilltheParisAgreementandpreventtheworstconsequencesofclimatechange.Wehavethere-fore based our climate goals on what, according to the lat-est research, we must do to contribute to the most ambitious goalintheParisAgreement.Furthermore,wehaveinitiatedthe work with control and risk management in accordance

with TCFD's guidelines, in order to increase our understand-ingofhowweareaffectedbyclimatechangeandpolicyinstrumentstoreducecarbondioxideemissions.Thisdisclo-sureisourfirstattempttoincludeclimaterelatedfinancialdislosures in our report and we will continue to develop the workinthecomingyears.

Metrics and targets

Risk & opportunity

StrategyGovernance



Financial statementsConsolidated income statement 60

Consolidated statement of comprehensive income 60

Comments and analysis of income statement 61

Consolidated balance sheet 63

Comments and analysis of balance sheet 64

Change in consolidated shareholders’ equity 65

Consolidated cash-flow statement and comments 66

Parent Company 67

Notes

Note 1 Significant accounting policies 69

Note 2 Financial risks 77

Note 3 Operating segments and net sales 80

Note 4 Costs for employee benefits and remuneration to senior executives 81

Note 5 Average number of employees 84

Note 6 Remuneration to auditors 84

Note 7 Depreciation/amortisation and impairment by activity 84

Note 8 Other operating income 84

Note 9 Other operating expenses 84

Note 10 Specification by type of cost 84

Note 11 Financial income and expenses 85

Note 12 Tax on net profit for the year 85

Note 13 Intangible assets 85

Note 14 Tangible fixed assets 86

Note 15 Right-of-use assets 87

Note 16 Financial fixed assets 88

Note 17 Shares and participations in subsidiaries 88

Note 18 Derivative instruments 89

Note 19 Prepaid expenses and accrued income 89

Note 20 Cash and cash equivalents 89

Note 21 Share capital 89

Note 22 Reserves in shareholders’ equity 89

Note 23 Earnings per share 90

Note 24 Appropriation of company’s profit or loss 90

Note 25 Provisions for pensions 90

Note 26 Deferred tax 93

Note 27 Other provisions 94

Note 28 Liabilities to credit institutions 94

Note 29 Accrued expenses and deferred income 94

Note 30 Financial assets and liabilities 94

Note 31 Pledged assets, contingent liabilities and commitments 96

Note 32 Related-party transactions 96

Note 33 Specifications for statement of cash flows 97

Note 34 Events after the closing date 97

Financial statements


Consolidated income statement

SEK m Note 2019 2020

Net sales 3 13,930 12,741Cost of goods sold 4,7,10,25 -8,625 -8,297Gross profit 5,305 4,444

Selling expenses 4,7,10,25 -3,371 -3,256Administrative expenses 4,6,7,10,25 -922 -971Other operating income 8 432 703Other operating expenses 9 -312 -483Operating profit 1,132 437

Financial income 11 1 7Financial expenses 11 -94 -91Profit after financial items 1,039 353

Taxonnetprofitfortheyear 12,26 -229 -100Net profit for the year 810 253

Net profit for the year attributable to:Parent Company shareholders 810 253

Earnings per share before dilution, SEK1 23 4.80 1.50Earnings per share after dilution, SEK1 23 4.79 1.501)Sharesoutstanding,lessbought-backshares.

Consolidated statement of comprehensive income


Netprofitfortheyear 810 253

Other comprehensive incomeItems that may be reclassified to profit or lossExchange-ratedifferencesattributabletotranslationofforeignoperations 22 241 -399Cash-flowhedgesbeforetax1 22 -19 1Tax attributable to hedging reserve for the period2 22 4 -2

226 -400

Items that will not be reclassified to profit or lossRemeasurementsofdefined-benefitpensionplans 25 6 -135Taxattributabletoremeasurementsofdefined-benefitpensionplans 0 30

6 -105Other comprehensive income for the year 232 -505Total comprehensive income for the year 1,042 -252

Total comprehensive income for the year attributable to:Parent Company shareholders 1,042 -2521)ReversalrecognisedinprofitorlossofSEK15m(-3).NewprovisionamountstoSEK-17m(-15).2)ReversalrecognisedinprofitorlossofSEK-3m(1).NewprovisionamountstoSEK4m(3).



Comments and analysis of income statement

Netsalesdecreased9%toSEK12,741m(13,930).Forcomparableunitsandadjustedforcurrencyeffects,thechangeinnetsaleswas-7%.Therelationshipisshowninthetablebelow.

QUARTER JAN-DECAnalysis of net sales, % I II III IV % SEK m

2019 3,469 3,751 3,265 3,445 13,930Organic growth -85 -952 -58 183 -7 -911–ofwhichNordicregion1 10 -31 50 177 3 208–ofwhichUKregion1 -92 -866 -136 -53 -19 -1,148–ofwhichCentralEuroperegion1 -3 -55 28 59 2 29Currencyeffect 61 -58 -102 -178 -2 -2782020 3,445 2,741 3,105 3,450 -9 12,7411)Organicgrowthforeachorganisationalregion.

Net sales and profit by region

Nordic region

UK region

Central Europe region

Group-wide and eliminations Group

SEK m 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020

Net sales from external customers 6,753 6,801 5,902 4,649 1,275 1,291 – – 13,930 12,741Net sales from other regions 0 0 – – 0 0 0 0 – –Total net sales 6,753 6,801 5,902 4,649 1,275 1,291 0 0 13,930 12,741Grossprofit 2,567 2,455 2,282 1,509 394 419 62 61 5,305 4,444Grossprofitexcludingitemsaffectingcomparability 2,567 2,567 2,282 1,509 394 419 62 54 5,305 4,549Gross margin, % 38.0 36.1 38.7 32.5 30.9 32.5 – – 38.1 34.9Grossmarginexcludingitemsaffectingcomparability, % 38.0 37.7 38.7 32.5 30.9 32.5 – – 38.1 35.7Operatingprofit 886 765 345 -234 98 143 -197 -237 1,132 437Operatingprofitexcl.itemsaffectingcomparability 886 897 345 -226 98 143 -197 -233 1,132 581Operating margin, % 13.1 11.2 5.8 -5.0 7.7 11.1 – – 8.1 3.4Operatingmarginexcl.itemsaffectingcomparability, % 13.1 13.2 5.8 -4.9 7.7 11.1 – – 8.1 4.6Depreciation/amortisationandimpairmentoffixedassetsfortheyearrecognisedinoperatingprofitamountedtoSEK989m(835).

Impact of exchange rate (Operating profit)

Translation effect Transaction effect Total effectSEK m 2019 2020 2019 2020 2019 2020

Nordic region 20 -10 -20 -60 0 -70UK region 15 5 0 0 15 5Central Europe region 0 0 0 0 0 0Group 35 -5 -20 -60 15 -65



Quarterly data per region

2019 2020I II III IV I II III IV

Net sales, SEK mNordic 1,724 1,870 1,501 1,658 1,739 1,804 1,491 1,767UK 1,448 1,535 1,464 1,455 1,405 645 1,295 1,304Central Europe 297 346 300 332 301 292 319 379Group-wide and eliminations 0 0 0 0 0 0 0 0Group 3,469 3,751 3,265 3,445 3,445 2,741 3,105 3,450

Gross profit, SEK mNordic 655 732 562 618 662 669 538 586UK 570 610 548 554 505 94 442 468Central Europe 76 108 103 107 91 82 108 138Group-wide and eliminations 16 15 15 16 18 21 20 2Group 1,317 1,465 1,228 1,295 1,276 866 1,108 1,194

Gross profit excl. items affecting comparabil-ity, SEK mNordic 655 732 562 618 662 669 538 698UK 570 610 548 554 505 94 442 468Central Europe 76 108 103 107 91 82 108 138Group-wide and eliminations 16 15 15 16 18 21 20 -5Group 1,317 1,465 1,228 1,295 1,276 866 1,108 1,299

Gross margin, %Nordic 38.0 39.1 37.4 37.3 38.1 37.1 36.1 33.2UK 39.4 39.7 37.4 38.1 35.9 14.6 34.1 35.9Central Europe 25.6 31.2 34.3 32.2 30.2 28.1 33.9 36.4Group 38.0 39.1 37.6 37.6 37.0 31.6 35.7 34.6

Gross margin excl. items affecting compara-bility, %Nordic 38.0 39.1 37.4 37.3 38.1 37.1 36.1 39.5UK 39.4 39.7 37.4 38.1 35.9 14.6 34.1 35.9Central Europe 25.6 31.2 34.3 32.2 30.2 28.1 33.9 36.4Group 38.0 39.1 37.6 37.6 37.0 31.6 35.7 37.7

Operating profit, SEK mNordic 214 275 193 204 198 234 183 150UK 73 127 88 57 -21 -239 13 13Central Europe 5 32 28 33 18 25 38 62Group-wide and eliminations -32 -43 -42 -80 -61 -63 -39 -74Group 260 391 267 214 134 -43 195 151

Operating profit excl. items affecting compa-rability, SEK mNordic 214 275 193 204 198 234 183 282UK 73 127 88 57 -21 -239 13 21Central Europe 5 32 28 33 18 25 38 62Group-wide and eliminations -32 -43 -42 -80 -61 -63 -39 -70Group 260 391 267 214 134 -43 195 295

Operating margin, %Nordic 12.4 14.7 12.9 12.3 11.4 13.0 12.3 8.5UK 5.0 8.3 6.0 3.9 -1.5 -37.1 1.0 1.0Central Europe 1.7 9.2 9.3 9.9 6.0 8.6 11.9 16.4Group 7.5 10.4 8.2 6.2 3.9 -1.6 6.3 4.4

Operating margin excl. items affecting com-parability, %Nordic 12.4 14.7 12.9 12.3 11.4 13.0 12.3 16.0UK 5.0 8.3 6.0 3.9 -1.5 -37.1 1.0 1.6Central Europe 1.7 9.2 9.3 9.9 6.0 8.6 11.9 16.4Group 7.5 10.4 8.2 6.2 3.9 -1.6 6.3 8.6



Consolidated balance sheet

SEK m Note 31 Dec 2019 31 Dec 2020

ASSETSIntangible assets 13Goodwill 3,042 2,830Other intangible assets 232 221

3,274 3,051

Tangible fixed assets 14Landandbuildings 676 529Investments in progress and advance payments 151 145Machinery and other technical equipment 531 421Equipment,tools,fixturesand fittings 283 245Right-of-use assets 15 2,549 2,200

4,190 3,540

Interest-bearing long-term receivables (IB) 16 2 0Other long-term receivables 16 103 96Deferred tax assets 26 72 119Total fixed assets 7,641 6,806

InventoriesRaw materials and consumables 330 331Products in progress 110 93Finished products 600 516Goods for resale 105 95

1,145 1,035

Current receivablesCurrent tax assets 51 20Accounts receivable 2 1,371 1,213Derivative instruments 2,18 2 0Interest-bearing current receivables (IB) 4 2Other receivables 2 60 61Prepaid expenses and accrued income 19 315 313

1,803 1,609

Cash and cash equivalents (IB) 20 257 635Total current assets 3,205 3,279Total assets 10,846 10,085

Of which interest-bearing items (IB) 263 637

SEK m Note 31 Dec 2019 31 Dec 2020

SHAREHOLDERS’ EQUITY AND LIABILITIES Attributable to Parent Company shareholdersShare capital 21 57 57Other contributed capital 1,497 1,506Reserves 22 55 -345Profitbroughtforward 2,668 2,816Total shareholders’ equity 4,277 4,034

Provisions for guarantees 9 9Provisions for pensions (IB) 25 473 556Leaseliabilities(IB) 15 2,113 1,778Deferred tax liabilities 26 49 35Other provisions 27 28 36Liabilitiestocreditinstitutions(IB) 2,28 1,130 285Other liabilities (IB) 2 4 –Other liabilities, non-interest-bearing 2 33 0Total long-term liabilities 3,839 2,699

Liabilitiestocreditinstitutions(IB) 2,28 0 0Advance payments from customers 138 140Accounts payable 2 1,162 1,317Provisions 27 11 10Current tax liabilities 56 36Leaseliabilities(IB) 15 362 405Derivative instruments 2,18 23 21Other liabilities 2 363 644Accrued expenses and deferred income 29 615 779Total current liabilities 2,730 3,352Total shareholders’ equity and liabilities 10,846 10,085

Of which interest-bearing items (IB) 4,082 3,024

Information on consolidated pledged assets and contingent liabili-tiesisprovidedinNote31.



Comments and analysis of balance sheet

GoodwillInformation on goodwill, including comments, is provided in Note 13.

Financing NetdebtdeclinedtoSEK2,387m(3,819)attheendoftheperiod.ApositiveoperatingcashflowofSEK1,808mreducednetdebt.ThechangeinpensionliabilitiesofSEK27mandinterestofSEK61mincreasednetdebt.Thedebt/equityratioamountedto59%attheendoftheyear(89%atthebeginningoftheyear).Thechangeinnetdebtisshowninthetablebelow.

Analysis of net debtGroup

SEK m 2019 2020

Opening balance 1,266 3,819OB lease liabilities, new accounting policy 2,716 –Newleases/Leasesterminatedinadvance, net 115 304Translationdifferences 155 -163Operatingcashflow -1,179 -1,808Interest 69 61Remeasurementsofdefined-benefit pension plans -6 147Change in pension liabilities 17 27Treasury shares, reissued -9 –Dividends 675 –Closing balance 3,819 2,387

Thecomponentsofnetdebtareshowninthetablebelow.

Components of net debtGroup

SEK m 2019 2020

Bankloans,etc. 1,130 285Overdraft facilities – –Provisions for pensions 473 556Leasing 2,475 2,183Otherfinancialliabilities 4 –Cash and cash equivalents -257 -635Otherfinancialreceivables -6 -2Total 3,819 2,387



Change in consolidated shareholders’ equity

Attributable to Parent Company shareholders

SEK m Share capital

Other contributed

capital

Exchange-rate differences

attributable to translation

of foreign operations

Cash-flow hedges after

taxProfit brought

forward

Total shareholders’

equity

Opening balance, 1 January 2019 57 1,484 -173 2 2,527 3,897Netprofitfortheyear – – – – 810 810Other comprehensive income for the year – – 241 -15 6 232Total comprehensive income for the year – – 241 -15 816 1,042Dividends1 – – – – -675 -675Treasury shares, reissued – 9 – – – 9Allocation of performance share plan – 4 – – – 4Closing balance, 31 December 2019 57 1,497 68 -13 2,668 4,277

Opening balance, 1 January 2020 57 1,497 68 -13 2,668 4,277Netprofitfortheyear – – – – 253 253Other comprehensive income for the year – – -399 -1 -105 -505Total comprehensive income for the year – – -399 -1 148 -252Dividends2 – – – – – –Allocation of performance share plan – 9 – – – 9Closing balance, 31 December 2020 57 1,506 -331 -14 2,816 4,0341)The2019AnnualGeneralMeetingresolvedondividendsofSEK675m,correspondingtoSEK4pershare.2)The2020AnnualGeneralMeetingresolvedondividendsofSEK0m,correspondingtoSEK0pershare.



Consolidated cash-flow statement and comments


Operating activitiesOperatingprofit 1,132 437Depreciation/amortisation/impairment 13,14,15 835 989Other adjustments for non-cash items 29 50Income tax paid -305 -118Change in inventories -150 -26Change in operating receivables 110 32Change in operating liabilities -18 704Cash flow from operating activities 1,633 2,068

Investing activitiesInvestmentsintangiblefixedassets -372 -199Investments in intangible assets -93 -109Saleoftangiblefixedassets 67 49Interest received 1 2Increase/decrease in interest-bearing assets 29 5Other items in investing activities -56 -1Cash flow from investing activities -424 -253

Operating cash flow before acquisitions/divestments of subsidiaries, interest, increase/decrease in interest-bearing assets 1,179 1,808Operating cash flow after acquisitions/divestments of subsidiaries, interest, increase/decrease in interest-bearing assets 1,209 1,815

Financing activitiesInterest paid -70 -63Change in interest-bearing liabilities 891 -9112 Change in lease liabilities -475 -449Treasury shares, reissued 9 –Dividends -675 –Cash flow from financing activities -1,122 -1,423Cash flow for the year excluding exchange-rate differences in cash and cash equivalents 87 392

Cash and cash equivalents at the beginning of the year 128 257Cash flow for the year 87 392Exchange-ratedifferencesincashandcashequivalents 42 -14Cash and cash equivalents at year-end 257 6351)RaisingandrepaymentofloanscomprisinganetSEK240m.Theremainingchangeprimarilycomprisespensionpaymentsandrepaymentofcurrentinterest-bearingliabili-ties.

2)RaisingandrepaymentofloanscomprisinganetSEK-849m.Theremainingchangeprimarilycomprisespensionpaymentsandrepaymentofcurrentinterest-bearingliabili-ties.

Comments on the cash-flow statementCashflowfromoperatingactivitiesamountedtoSEK2,068m(1,633).WorkingcapitalimprovedcashflowbySEK710m(-58)andwas primarily attributable to government measures, such as delayedtaxandVATpaymentsduringthecoronaviruspandemic.Adjustmentsfornon-cashitemsamountedtoSEK50m(29)asspec-ifiedinthetablebelow.

Adjustments for non-cash itemsSEK m 2019 2020

Capitalgains/lossesonfixedassets -17 -4Provisions 21 54Other 25 0Total 29 50

InvestmentsinfixedassetsamountedtoSEK308m(465).Operatingcashflow,thatis,thecashflowafterinvestmentsbut

excluding the acquisitions and divestments of operations, interest and increases/decreases in interest-bearing assets, amounted to SEK1,808m(1,179).



Parent Company

Parent Company income statementSEK m Note 2019 2020

Net sales 281 337Administrative expenses 4,6,25 -332 -506Other operating income 8 6 8Other operating expenses 9 -4 -9Operating profit -49 -170

ProfitfromparticipationsinGroup companies 11 500 –Financial income 11 80 11Financial expenses 11 -10 -202Profit after financial items 521 -361

Group contributions received 150 155Group contributions paid -187 –Taxonnetprofitfortheyear 12 0 -1Net profit for the year 484 -207

Parent Company statement of comprehensive incomeSEK m Note 2019 2020

Netprofitfortheyear 484 -207Other comprehensive income for the year – –Comprehensive income for the year 484 -207

Parent Company cash-flow statementSEK m Note 2019 2020

Operating activitiesOperatingprofit -49 -170Adjustments for non-cash items 0 4Dividends received 11 500 –Group contributions received 150 155Group contributions paid -187 –Interest received 11 80 11Interest paid 11 -10 -202Tax paid -22 -1Cash flow from operating activities before changes in working capital 462 -203

Change in liabilities 66 1,055Change in receivables 282 -574Cash flow from operating activities 810 278

Investing activitiesTangiblefixedassets -29 3Provisions for pensions 2 1Cash flow from investing activities -27 4

Financing activitiesChange in interest-bearing liabilities 3 -4Reissued treasury shares 9 –Dividends -675 –Cash flow from financing activities -663 -4Cash flow for the year 120 278

Cash and cash equivalents at the beginning of the year 38 158Cash flow for the year 120 278Cash and cash equivalents at year-end 158 436

Parent Company balance sheet

SEK m Note31 Dec

201931 Dec

2020

ASSETSFixed assetsTangiblefixedassets 29 26Shares and participations in Group companies 16,17 1,380 1,385Othersecuritiesheldasfixedassets 6 5Total fixed assets 1,415 1,416

Current assetsCurrent receivablesAccounts receivable 1 0Receivables from Group companies 2,212 2,833Other receivables 18 70 28Prepaid expenses and accrued income 19 84 81Cash and cash equivalents 20 158 436Total current assets 2,525 3,378Total assets 3,940 4,794

SHAREHOLDERS’EQUITY,PROVI-SIONSANDLIABILITIESShareholders’ equityRestricted shareholders’ equityShare capital1) 21 57 57Statutory reserve 1,671 1,671

1,728 1,728

Non-restricted shareholders’ equityShare premium reserve 52 52Buy-back of shares -82 -82Profitbroughtforward 823 1,316Netprofitfortheyear 484 -207 1,277 1,079Total shareholders’ equity 3,005 2,807

Long-term liabilitiesProvisions for pensions 25 21 22Deferred tax liabilities 5 5Long-terminterest-bearingliabilities 22 17Total long-term liabilities 48 44

Current liabilitiesOther interest-bearing liabilities 6 7Accounts payable 44 31LiabilitiestoGroupcompanies 790 1,815Current tax liabilities 0 0Other liabilities 18 29 39Accrued expenses and deferred income 29 18 51Total current liabilities 887 1,943Total shareholders’ equity, provisions and liabilities 3,940 4,7941)Thenumberofsharesoutstandingwas168,852,821(168,852,821).



Parent Company change in shareholders’ equity

SEK m Share capitalStatutory

reserve1Share premium

reserveBuy-back of

sharesProfit brought

forward

Total shareholders’

equity

Openingbalance,1January2019 57 1,671 52 -92 1,495 3,183Netprofitfortheyear – – – – 484 484Comprehensive income for the year – – – – 484 484Dividends – – – – -675 -675Treasury shares, reissued – – – 10 -1 9Allocation of performance share plan – – – – 4 4Shareholders’ equity, 31 December 2019 57 1,671 52 -82 1,307 3,005

Opening balance, 1 January 2020 57 1,671 52 -82 1,307 3,005Netprofitfortheyear -207 -207Comprehensive income for the year – – – – -207 -207Dividends – – – – – –Allocation of performance share plan – – – – 9 9Shareholders’ equity, 31 December 2020 57 1,671 52 -82 1,109 2,8071)OftheParentCompany’sstatutoryreserve,SEK1,390m(1,390)comprisescontributedshareholders’equity.



Notes

Note 1 Significant accounting policies

Compliance with standards and legislationNobia’sconsolidatedfinancialstatementsarepreparedinaccor-dance with International Financial reporting Standards, IFRS, as published by the International Accounting Standards Board (IASB) asadoptedbytheEuropeanUnion(EU).TheSwedishFinancialReporting Board’s recommendation RFR 1 Supplementary Account-ingRulesforGroupswasalsoapplied.

The Parent Company applies the same accounting policies as the Group except in the cases described below under the section enti-tled“ParentCompanyaccountingpolicies.”TheAnnualReportandtheconsolidatedfinancialstatementswereapprovedforissuebytheBoardofDirectorsandPresidenton6April2021.

Principles applied in the preparation of the financial statementsAssets and liabilities are recognised at historic acquisition value (cost),exceptforcertainfinancialassetsandliabilitiesandfixedassetsheldforsale.Financialassetsandliabilitiesmeasuredatfairvaluecomprisederivativeinstruments.Fixedassetsheldforsaleare recognised at the lower of the carrying amount and fair value, lesssellingexpenses.Receivablesandliabilitiesandincomeandexpensesareoffset

only if required or expressly permitted in an accounting recommen-dation.

The Parent Company’s functional currency is Swedish kronor (SEK), which is also the presentation currency for the Parent Com-panyandGroup.Accordingly,thefinancialstatementsarepre-sentedinSEK.AllamountsarestatedinSEKmillion(SEKm),unlessotherwisestated.Themostsignificantaccountingpoliciesstatedbelowareapplied

consistently to all of the periods presented in the consolidated financialstatements.PreparingthefinancialstatementsinaccordancewithIFRS

requires that company management make assessments, estimates andassumptionsthataffecttheapplicationofaccountingpoliciesand the recognised amounts of assets, liabilities, income and expenses.Theactualoutcomemaydifferfromtheseestimatesandassessments.Estimatesandassumptionsareregularlyreviewed.Changes to estimates are recognised in the period in which the changeismadeifthechangeaffectsonlythatperiod,orintheperiod in which the change is made and future periods if the changeaffectsbothcurrentperiodsandfutureperiods.Assess-ments made by company management in the application of IFRS thathaveamaterialimpactonthefinancialstatementsandesti-matesmadethatmayleadtosignificantadjustmentsinthefinan-cialstatementsoffuturefiscalyearsareprimarilythefollowing:

Impairment testing of goodwillGoodwillisrecognisedatcostlessanyaccumulatedimpairment.The Group regularly (at least once each year) performs impairment tests of goodwill, and when indicators of impairment exist, in accor-dance with the accounting policies described under Note 13 Intan-gibleassets.Theassumptionsandassessmentsmadepertainingtoexpectedcashflowsandthediscountrateintheformofweightedaverage cost of capital are described under Note 13 Intangible assets.RecognisedgoodwillamountedtoSEK2,830m(3,042)on31December2020.

Deferred tax assetsThe Group’s loss carryforwards for which deferred tax assets have beencapitalisedhaveacarryingamountofSEK0m(2.7).Deferredtax assets pertaining to loss carryforwards are capitalised to the extentitisprobablethatcarryforwardscanbeoffsetagainstsur-plusesinfuturetaxation.Particularlyhighdemandsareplacedon

the assessment if the company, to which the loss carryforwards are attributable,hasrecognisedlossesinrecentyears.Theamountsofcapitalised and non-capitalised loss carryforwards in the Group arepresentedinNote26Deferredtax.Iftheprobabilitythatnon-capitalised loss carryforwards could be utilised in future taxa-tion in future annual accounts is deemed to be high, additional amounts may be capitalised, with a corresponding positive amount recognisedinprofitorloss.Thereverseappliesifmarketsweretosignificantlydeteriorateinforthcomingyears.Thecurrentassess-ment is that the probability of such increases or declines in the value in the balance sheet during the forthcoming year is not high, although this cannot be ruled out if conditions in the kitchen mar-ketsweretochangemorethanexpected.TheGroup’sdeferredtaxassetsamountedtoSEK119m(72)on31December2020.

Defined-benefit pensionsTheGroup’sdefined-benefitpensionplansarerecognisedaccord-ing to common principles and calculation methods and are calcu-latedbyassessingfuturesalaryincreasesandinflation.TheGroup’spensionliabilitiesamountedtoSEK556m(473)on31December2020.

Changed accounting policiesThe changed accounting policies applied by the Group from 1 Jan-uary2020aredescribedbelow.OtherIFRSchangesappliedfrom1January2020didnothaveanymaterialeffectontheconsolidatedfinancialstatements.

Amendment to IFRS 3 Business Combinations:Change / impact: Definition of a “business”TheISABhasissuedamendmentstoIFRS3asregardsthedefinitionofabusiness.Classifyinganacquisitionaseitheranacquisitionofa group of assets or a business gives rise to major accounting dif-ferences.Theamendmentisexpectedtoresultinfewerbusinesscombinationsbeingclassifiedasanacquisitionofabusinessandinsteadbeingclassifiedasanacquisitionofagroupofassets.Theaccountingdifferencesbetweenabusinessandagroupofassetscouldbesignificantsincedifferentstandardsareapplied.Thisaffectsforexampletheaccountingofgoodwill,whichisnotrec-ognised for a group of assets, and transaction costs, which are expensedforabusiness.Theclassificationasabusinessoragroupof assets could also impact the recognition of deferred tax and how additionalpurchaseconsiderationsarepresented.

The amendment did not have any material impact on the Nobia Groupin2020.

Amendments to IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors:Change / impact: Definition of “material”Theamendmentseekstoharmonisethedefinitionof“material”betweenthevariousIFRSsandclarifythemeaningoftheterm.Theamendmentclarifiesthatmaterialitydependsonthenatureormagnitudeofinformation,orboth.Thedefinitionhasalsobeenchangedfromthewordingthatinfor-

mation“couldinfluence”thedecisionsofusersoffinancialstate-mentsto“couldreasonablybeexpectedtoinfluence.”TheIASBhasalsomadeanamendmenttoclarifythattheusersoffinancialstatementsarenowthe“primaryusers.”Thisistoensurethatthedefinitionisnotinterpretedtoobroadly.

The new wording is as follows: “Information is material if omitting, misstatingorobscuringitcouldreasonablybeexpectedtoinflu-encethedecisionsthattheprimaryusersofgeneralpurposefinan-cialstatementsmakeonthebasisofthosefinancialstatements,

Notes


whichprovidefinancialinformationaboutaspecificreportingentity.”TheamendmentdidnotimpacttheNobiaGroupin2020.

Amendments to IFRS 9, IAS 39, IFRS 7:Change / impact: IBOR Reform, Phase 1 – hedge accountingAs a result of the reforms promoted by the Financial Stability Board, various countries are working on replacing IBOR with new reference ratesorrisk-freerates(RFR).Theamendmenttoreferenceratescouldaffectcompanies’

hedgeaccounting,amongotheritems.TheamendmentstoIFRS9,IAS39andIFRS4introduceexemptionsfromcertainrequirementsregarding how a hedging relationship is to be evaluated regarding IBORrateswhenhedgeaccountingisapplied.Theamendmentsalsointroducenewdisclosurerequirements.

The amendment did not have any material impact on the Nobia Groupin2020.

Amendment to IFRS 16:Change / impact: Amendment to the standard on Covid-19-related rent concessionsTheIASBintroducedpracticalrelieftoIFRS16on28May2020.Inbrief, the relief entails that lessees do not need to assess whether a coronapandemicrelatedrentconcessionisaleasemodification.Accordingly, a rent concession for a lessee can be recognised directlyinprofitorloss.Thereisnosuchreliefforthelessor.

The concession entails that the lessee recognises the change in leasepaymentinaccordancewithIFRS16,butwithouttreatingthechangeasaleasemodification,meaningthatthechangedpay-mentisrecognisedinprofitorloss.Thereliefonlyappliestorentreductionsthatareadirectresultofthecoronapandemic.Thefol-lowingconditionsmustalsobesatisfied:

The changes to lease payments result in the changed total lease cost essentially being the same or lower than the total cost before thechangewasmade.Thereductioninleasepaymentsaffectsonlypaymentsoriginally

dueonorbefore30June2021.Theleaseconditionshavenotbeensignificantlychanged.Companies that apply the exemption are also required to disclose

thisfact.Disclosuresarealsotobeprovidedastowhetherthereliefhasbeenappliedtoallleasesorcertainleases.Forleasestowhichthereliefhasbeenapplied,thetypeofleaseistobedisclosed.Dis-closures are also to be provided on the amounts related to rent reductionsthathavebeenrecognisedinprofitorloss.Lesseeswhoapplytheexemptionmaydosoretrospectively,

meaning that opening shareholders’ equity may be adjusted at the startofthefirstperiodtowhichthereliefisapplied.Theamend-mentisappliedforfiscalyearsbeginningonorafter1June2020.Earlierapplicationispermitted.

Nobia took this relief into consideration in 2020 and applied it to corona pandemic related rent concessions primarily in the UK in accordancewiththeabove.

Other new or amended IFRSs and interpretationsOther amendments to accounting policies with future application arenotdeemedtohaveanymaterialeffectontheconsolidatedfinancialstatementsandwillnotbeappliedinadvance.

ClassificationFixed assets essentially comprise amounts that are expected to be recoveredmorethan12monthsaftertheclosingdate.Currentassets essentially comprise amounts that are expected to be recov-eredwithinthe12monthsaftertheclosingdate.Long-termliabilitiescomprise liabilities that Nobia intends, and has an unconditional right,topaylaterthan12aftertheclosingdate.Otherliabilitiescomprisecurrentliabilities.

Consolidation principles and business combinationsSubsidiariesSubsidiaries are companies subject to the controlling interest of NobiaAB.AcontrollinginterestexistsifNobiaABhasinfluenceoverthe investment object, is exposed to or has the right to variable returnsforitsinvolvementandcanuseitsinfluenceovertheinvest-

menttoinfluencethisreturn.Whenassessingwhetheracontrollinginterest exists, potential voting shares are taken into account and whetherdefactocontrolexists.

Business combinations are recognised in accordance with the acquisitionmethod.Accordingtothismethod,anacquisitionofasubsidiary is considered a transaction through which the Group indirectly acquires the subsidiary’s assets and assumes its liabili-tiesandcontingentliabilities.TheGroup-wisecostisdeterminedbyanacquisitionanalysisinconjunctionwiththeacquisition.Theanalysis determines the cost of the participations or business activ-ities,andthefairvalueoftheacquiredidentifiableassetsandassumed liabilities and contingent liabilities on the acquisition date.

Goodwill in business combinations is calculated as the total of the consideration transferred, any non-controlling interests (previ-ously termed minority interests) and fair value of previously owned participations (for step acquisitions) less the fair value of the sub-sidiary’sidentifiableassetsandassumedliabilities.Whenthedif-ferenceisnegative,itisrecogniseddirectlyinnetprofitfortheyear.Transactioncostsattributabletobusinesscombinationsareexpensed.

Contingent consideration in acquisitions is measured at fair value on both the acquisition date and continuously thereafter, with changesinvaluerecognisedinprofitorloss.

For acquisitions of subsidiaries involving non-controlling inter-ests, the Group recognises net assets attributable to non-con-trolling interests either at fair value of all of the net assets except goodwill,oratfairvalueofallnetassetsincludinggoodwill.Theprincipleisdecidedindividuallyforeachacquisition.

Ownership in companies that grow through acquisitions on sev-eraloccasionsarerecognisedasstepacquisitions.Forstepacqui-sitions that lead to a controlling interest, the previously acquired participations are remeasured according to the most recent acqui-sitionandthearisinggainsorlossesarerecognisedinprofitorloss.Whencontrollinginterestsareachieved,changesinownership

are recognised as a reallocation of shareholders’ equity between the Parent Company’s owners and the non-controlling interest, withoutanyremeasurementofthesubsidiary’snetassets.

If ownership is reduced to such an extent that controlling interests are lost, any remaining holdings are recognised at fair value and thechangeinvalueisrecognisedinprofitorloss.Whenacquisitionsofsubsidiariesinvolveacquisitionsofnet

assets that are not part of the operations, the acquisition cost is distributedbetweentheindividualidentifiableassetsandliabilitiesbasedontheirfairvalueontheacquisitiondate.Thefinancialstatementsofsubsidiariesareincludedinthecon-

solidatedfinancialstatementsfromthedatethatthecontrollinginterestarisesandareincludedintheconsolidatedfinancialstate-mentsuntilthedateonwhichthecontrollinginterestceases.

Transactions that are eliminated through consolidationIntra-Group receivables and liabilities, income or expenses and unrealised gains or losses that arise from intra-Group transactions between Group companies, are eliminated in their entirety in the preparationoftheconsolidatedfinancialstatements.

Translation of foreign subsidiariesThefinancialstatementsofsubsidiariesarepreparedinthelocalcurrency (functional currency) used in the country in which the companyconductsoperations.Swedishkronor,SEK,isutilisedintheconsolidatedfinancialstatements,whichistheParentCompa-ny’s functional currency and also the Group’s presentation cur-rency.ThismeansthattheearningsandfinancialpositionofallGroupcompaniesthathaveafunctionalcurrencythatisdifferentto the presentation currency are translated to the Group’s presen-tationcurrencyofSEK.Foreignsubsidiaries’assetsandliabilitiesare translated at the closing-date rate and all items recognised in profitorlossandothercomprehensiveincomearetranslatedattheaverageexchangeratefortheyear.Translationdifferencesarerec-ognised in other comprehensive income and are accumulated in a separatereserveinconsolidatedshareholders’equity.

Note 1 continued

Notes


Significant exchange ratesClosing-date rate Average

31 Dec 2019 31 Dec 2020 2019 2020

DKK 1.40 1.35 1.42 1.41EUR 10.43 10.04 10.59 10.49GBP 12.21 11.09 12.07 11.80NOK 1.06 0.95 1.07 0.98USD 9.32 8.19 9.46 9.20

Segment reportingAn operating segment is a part of the Group that conducts busi-ness activities from which it can generate income and incur expensesandforwhichindependentfinancialinformationisavail-able.Furthermore,theresultsofanoperatingsegmentaremoni-tored by the company’s chief operating decision-maker to evaluate themandtoallocateresourcestotheoperatingsegment.Nobia’soperating segments are the Group’s three regions: the UK, Nordic andCentralEuroperegions.Thedivisionoftheunitsperregionisbasedonthegeographicdomicileoftheunits.RefertoNote3amore detailed description of this division and a presentation of the operatingsegments.

Revenue recognitionThe Group’s revenue derives from the following activities:• Salesofkitchenproductsandotherproducts.• Revenue for installation services for kitchen products and other productssold.

Revenueismeasuredbasedontheremunerationspecifiedincon-tracts with customers, meaning net after VAT, discounts and returns.Revenueforsalesofgoodsandservicesisrecognisedinprofitorlosswhencontrolofthegoodsandservicesispassedtothecustomer.Determiningwhencontrolhaspassedtothecus-tomer, meaning a point in time or over time, requires assessments to bemade.

Sales of kitchen products and other products.The Group sells kitchen products and other products through a numberofdifferentsaleschannels,suchasownstores,franchisestores,builders’merchants,DIYchainsandotherretailers.Accord-ingly, sales take place both directly to end customers but also via retailers.Allguaranteesprovided,aimedatensuringthatsoldprod-uctscomplywiththeagreedspecifications,areincludedinthestandardsalesprice.Itisnotpossibletopurchaseofferedguaran-teed or additional guarantees, which is why these are recognised in accordancewithIAS37.Revenueforkitchenproductsandotherproducts is recognised at a point in time when control is passed to thecustomerandtheGrouphassatisfieditperformanceobliga-tion, which is usually when the goods are delivered to the agreed place.

In a small number of the Group’s contracts, the customers is offeredtheoptionofreturningorderedgoods.Aprovisionisrec-ognised on the sales date corresponding to the expected level of returnswiththecorrespondingreductioninrevenue.Noadjustmentis made to the costs since it is uncertain whether the returned goodswillbeinsaleablecondition.TheGroupbasestheaboveadjustments on past experience and manages these at portfolio levelmeasuredattheexpectedamount.Furthermore,theGroupbelieves that there is no risk of material reversals since the level of these items has been low in the past and there are currently no indi-cationsthatthissituationwillchange.

Revenue for installation services for kitchen products and other products sold.Revenue for installation services is deemed to be a distinct service andisthushandledasaseparateperformanceobligation.Regard-less of whether installation is included in the sales price of kitchen products and other products sold or if it is priced as a separate ser-vice, the portion of the transaction price that refers to installation will be recognised separately from revenue linked to the sale of kitchenandotherproducts.Iftheinstallationserviceisincludedinthe sales prices, a share of the total sales price will be allocated to

theinstallationperformanceobligation.Suchallocationwillbebasedonthemarketpriceofsuchservices.

Revenue for installation services is recognised separately, and recognisedovertimeastheinstallationisperformed.Giventhatthis normally involves a relative short period of time, such revenue is recognised straight-line during the period in which installation is performed.

Government assistanceGovernment subsidies are recognised in the balance sheet as deferred income when there is reasonable assurance that the sub-sidywillbereceivedandtheGroupwillfulfiltheconditionsassoci-atedwiththesubsidy.Subsidiesareallocatedsystematicallyintheincome statement in the same manner and over the same periods asthecostswhichthesubsidiesareintendedtocover.

Financial income and expensesFinancial income and expenses comprise interest income on bank balances and receivables, dividend income, interest expense on loansandpensionliabilities,aswellasexchange-ratedifferencesonfinancialitems.Interestincomeorinterestexpensearerec-ognisedaccordingtotheeffectiveinterestratemethod.DividendsarerecognisedinprofitorlossonthedatewhentheGroup’srighttopaymentisestablished.Theeffectiveinterestrateistheratethatexactly discounts the estimated future inward and outward pay-mentsduringtheexpectedlifeofthefinancialinstrumentto:• grosscarryingamountofthefinancialasset,or• theamortisedcostofthefinancialliability.

Forfinancialassetsthatarecredit-impairedafterinitialrecogni-tion,interestincomeiscalculatedbyapplyingtheeffectiveinterestratetothefinancialasset’samortisedcost.Iftheassetisnolongercredit-impaired, interest income is re-calculated by applying the effectiveinterestratetothegrosscarryingamount.

Tax Incometaxfortheyearcomprisescurrenttaxanddeferredtax.Incometaxisrecognisedinprofitorlossexceptwhentheunderly-ing transaction is recognised in other comprehensive income or in shareholders’equity,wherebytheassociatedtaxeffectsarerec-ognisedinothercomprehensiveincomeorinshareholders’equity.

Current tax is tax that is to be paid or received regarding the cur-rent year, by applying the tax rates determined or that have been determinedinprincipleontheclosingdate.Thisitemalsoincludesadjustmentstocurrenttaxattributabletopreviousperiods.

Deferred tax is calculated according to the balance-sheet methodonalltemporarydifferencesarisingbetweenrecognisedandfiscalvaluesofassetsandliabilities.Thetaxeffectattributabletotaxlosscarryforwardsthatcouldbe

utilisedagainstfutureprofitsiscapitalisedasadeferredtaxasset.This applies to both accumulated loss carryforwards at the acquisi-tiondateandlossesarisingthereafter.Valuationstakeplaceatthetaxrateapplyingontheclosingdate.

Deferredtaxisrecognisedinthebalancesheetasafixedassetorlong-termliability.Theincometaxliabilityisrecognisedasacur-rentreceivableorliability.Iftheactualoutcomediffersfromtheamountsfirstrecognised,

thedifferenceswillaffectcurrenttaxanddeferredtaxintheperiodinwhichthesecalculationsaremade.

Tangible fixed assetsTangiblefixedassetsarerecognisedatcostwithdeductionsfordepreciationandanyimpairment.Costincludesexpensesthatcanbedirectlyattributedtotheacquisition.Theborrowingcostsofthecost of any assets established that comprise qualifying assets are expensed.Costsforrepairs,maintenanceandanyinterestexpensesarerecognisedascostsinprofitorlossintheperiodinwhichtheyarise.

In the event that an asset’s carrying amount exceeds its esti-mated recoverable amount, the asset is written down to its recover-ableamount,whichischargedtooperatingprofit.Intheincomestatement,operatingprofitischargedwithstraight-

line depreciation, which is calculated on the original cost and is based on the estimated useful lives of the assets as follows:

Note 1 continued

Notes


• Kitchen displays 2-4 years• Officeequipmentandvehicles3-5years• Buildings15-40years• Machineryandothertechnicalequipment6-12years• Equipment,tools,fixturesandfittings6-12years

Landisnotdepreciated.

Fixed assets/disposal groups held for sale and discontinued operationsDiscontinued operations comprise important operations that have been divested or comprise a disposal group held for sale as well as subsidiaries that are acquired for the purpose of subsequently beingsold.Profitaftertaxfromdiscontinuedoperationsincludingchangesinvalueisrecognisedonaseparatelineinprofitorloss.Thesignificanceofagroupofassetsandliabilitiesbeingclassi-

fiedasheldforsaleisthatthecarryingamountsarerecoveredpri-marilybybeingsoldandnotbybeingused.Allassetsincludedinthe group are presented on a separate line among assets and all of the group’s liabilities are presented on a separate line among liabili-ties.Thegroupisvaluedatthelowerofthecarryingamountandfairvalue,lesssellingexpenses.

Intangible assetsGoodwill comprises the amount by which the cost of the acquired operationexceedstheestablishedfairvalueofidentifiablenetassets,asrecognisedintheacquisitionanalysis.Inconnectionwiththe acquisition of operations, goodwill is allocated to cash-generat-ingunits.Sincegoodwillhasanindeterminableusefullife,itisnotamortised.Instead,goodwillistestedforimpairmentatleastannu-allyandwhenanindicatorofimpairmentexists.Thecarryingamount comprises the cost less any accumulated impairment losses.Adescriptionofthemethodandassumptionsusedinimpair-menttestingcanbefoundinNote13Intangibleassets.

Other intangible assets are recognised at cost less accumulated amortisationandanyimpairment.Italsoincludescapitalisedcostsfor purchases and internal and external costs for the development ofsoftwarefortheGroup’sIToperations,patentsandlicences.Amortisation takes place according to the straight-line method basedontheestimatedusefullifeoftheasset(threetosixyears).

Research and product developmentCosts for product development are expensed immediately as and whentheyarise.

Product development within the Group is mainly in the form of design development and is conducted continuously to adapt to cur-rentstyletrends.Capitaliseddevelopmentexpenditureisamor-tisedovertheestimatedusefullife.Suchintangibleassetsthathavenotyetbeentakenintousearetestedforimpairmenteveryyear.

This development is relatively fast, which is the reason that no portion of the costs for product development is recognised as an intangibleasset.TheGroupdoesnotcarryoutresearchanddevel-opmentinthetruesenseofsuchwork,ortoanysignificantextent.

LeasesNobia assesses whether a contract is, or contains, a lease at the startofthecontract.ForcasesinwhichNobiaisdeemedtobealessee, a right-of-use asset is recognised that represents a right to use the underlying asset together with a lease liability that rep-resentsanobligationtopayleasepayments.Thereareexemptionsfor short-term leases (leases with a maximum term of 12 months) andleasesoflow-valueassets.Forleasesthatmeettheexemptioncriteria, the Group recognises lease payments as an operating expensestraight-lineovertheleaseterm.

Recognition for the lessor is similar to the former standard, mean-ingthatthelessorcontinuestoclassifyleasesasfinanceoroperat-ingleases.

The lease liability is initially measured at the present value of future lease payments that were not paid on the commencement date, discounted by a weighted average incremental borrowing rate.Theincrementalborrowingrateistherateofinterestthatalessee would have to pay to borrow over a similar term, and with a

similar security, the funds necessary to obtain an asset of similar valuetotheright-of-useassetinasimilareconomicenvironment.Leasepaymentsincludedinthemeasurementofleaseliabilities

include the following:• Fixed payments, less any incentives payable to be received when

the lease is signed,• Variable lease payments that depend on an index or rate, initially

measured using the index or rates on the commencement date, • Amounts expected to be payable by the lessee under a residual

value guarantee,• The exercise price under a purchase option that the lessee is rea-

sonably certain to exercise, and• Payments of penalties for terminating the lease, if the lease term reflectsthelesseeexercisinganoptiontoterminatethelease.

Leaseliabilitiesarerecognisedinsubsequentperiodsbytheliabil-itybeingincreasedtoreflecttheeffectoftheinterestandreducedtoreflecteffectofthepaidleasepayments.

The right-of-use asset is initially measured at the amount of the lease liability, plus lease payments paid at or prior to the com-mencementdateofthelease.Theright-of-useassetisrecognisedinsubsequentperiodsatcostminusdepreciationandimpairment.Right-of-use assets are depreciated over the estimated useful life or,ifitisshorter,thecontractedleaseterm.Ifaleasetransfersown-ership at the end of the lease term or if the cost includes the reason-able certain exercise of a purchase option, the right-of-use asset is depreciatedoveritsusefullife.Depreciationstartsonthecom-mencementdateofthelease.Leasesoflowvalue(assetsvaluedatlessthanaboutSEK50,000

innewcondition)–mainlycomprisingcomputers,printers/photo-copiersandcoffeemachines–arenotincludedintheleaseliabilitybutareexpensedstraight-lineovertheleaseterm.TheGroupisnotdeemed to have any material short-term leases (leases with a term ofamaximumof12months).

InventoriesInventoriescomprisefinishedandsemi-manufacturedproductsandrawmaterials.Inventoriesarevaluedaccordingtothefirst-in,first-out(FIFO)principle,atthelowerofthecostandnetsalesvalueontheclosingdate.Thenetsalesvaluecomprisestheestimatedsalesvalueintheongoingoperationslesssellingexpenses.Finishedand semi-manufactured products are valued at manufacturing cost including raw materials, direct labour, other direct expenses andproduction-relatedoverheadsbasedonnormalproduction.Deductionsaremadeforinter-Groupprofitsarisinginconjunc-

tionwithdeliveriesbetweencompaniesintheGroup.

Financial instruments Afinancialassetorafinancialliabilityisenteredinthebalancesheet when the company becomes a party in accordance with the contractualtermsoftheinstrument.Afinancialassetisderecognised from the balance sheet when all rewards and risks associatedwithownershiphavebeentransferred.Afinancialliabil-ity is derecognised from the balance sheet when the obligation resulting from the agreement has been realised or is extinguished in someothermanner.Financialassetsandliabilitiesareoffsetandrecognised net in the balance sheet only if there is a legal right to offsettherecognisedamountsandtheintentionistosettletheitems in a net amount or to simultaneously sell the asset and settle thedebt.Thelegallyenforceablerightmustnotbecontingentonfuture events and must be enforceable in the normal course of busi-ness and in the event of default, insolvency or receivership of the companyorthecounterparty.Financialassetsandliabilitiesarenotnettedinthebalancesheet.Gainsandlossesonderecognitionfromthebalancesheetandmodificationsarerecognisedinprofitorloss.

Recognition and measurement of financial instrumentsFinancialinstrumentsareclassifiedoninitialrecognition.Classifi-cationdeterminesthemeasurementoftheinstrument.UnderIFRS9,financialassetsareclassifiedbasedonthecompany’sbusinessmodelandtheobjectiveofthecontractualcashflows.

Note 1 continued

Notes


Financial assets Financial assets includes cash and cash equivalents, accounts receivable,short-terminvestments,derivativesandotherfinancialassets.TheGrouphasappliedIFRS9since1January2018.

Equity instruments:classifiedatfairvaluethroughprofitorloss.

Derivatives:areclassifiedatfairvaluethroughprofitorlossexceptwhentheyareclassifiedashedginginstrumentsincash-flowhedgeswhentheeffectiveportionisrecognisedin“Othercompre-hensiveincome”.

Debt instruments:classificationoffinancialassetsthataredebtinstruments is, in accordance with the above methods, based on the Group’s business model for managing the asset and the char-acteristicsoftheasset’scontractualcashflows.Instrumentsareclassifiedat:• amortised cost• fair value through other comprehensive income, or• fairvaluethroughprofitorloss

Financialassetsclassifiedatamortisedcostareinitiallymeasuredatfairvalueplustransactioncosts.Accountsreceivableareinitiallymeasuredattheinvoicedamount.Followinginitialrecognition,theassetsaremeasuredaccordingtotheeffectiveinterestratemethod.Assetsclassifiedatamortisedcostareheldunderthebusiness

modelofcollectingcontractualcashflowsthataresolelypay-ments of principal and interest on the principal amount outstand-ing.Theseassetsaresubjecttoalossallowanceforexpectedcreditlosses.TheGrouphasassetsclassifiedatfairvaluethroughothercomprehensiveincome.Fairvaluethroughprofitorlossappliestoall other debt instruments that are not measured at amortised cost orfairvaluethroughothercomprehensiveincome.Financialinstru-mentsinthiscategoryareinitiallymeasuredatfairvalue.Changesinfairvaluearerecognisedinprofitorloss.TheGroup’sdebtinstru-mentsareclassifiedatamortisedcost.

Fair value through other comprehensive income applies to assets held under the business model of both selling and collecting con-tractualcashflowsthataresolelypaymentsofprincipalandinter-estontheprincipalamountoutstanding.Financialinstrumentsinthiscategoryaremeasuredatfairvalueoninitialrecognition.Changes in fair value are recognised under “Other comprehensive income” until the asset is derecognised from the balance sheet, at which point the amounts under “Other comprehensive income” are reclassifiedtoprofitorloss.Theseassetsaresubjecttoalossallow-anceforexpectedcreditlosses.Fairvaluethroughprofitorlossisall other debt instruments that are not measured at amortised cost orfairvaluethroughothercomprehensiveincome.Financialinstru-mentsinthiscategoryareinitiallymeasuredatfairvalue.Changesinfairvaluearerecognisedinprofitorloss.

Financial liabilitiesFinancial liabilities include additional purchase considerations, loanliabilities,accountspayableandderivatives.Measurementisbasedontheclassificationoftheliabilities.TheGroupclassifiesfinancialliabilitiesinthecategoriesof:financialliabilitiesmea-suredatamortisedcostandfinancialliabilitiesmeasuredatfairvaluethroughprofitorloss,asfollows:

Debt instruments:areclassifiedatamortisedcostexceptforderiv-atives.Financialliabilitiesmeasuredatamortisedcostareinitiallymeasuredatfairvalueincludingtransactioncosts.Afterinitialrec-ognition, they are measured at amortised cost according to the effectiveinterestratemethod.

Derivatives:areclassifiedatfairvaluethroughprofitorlossexceptwhentheyareclassifiedashedginginstrumentsincash-flowhedgeswhentheeffectiveportionisrecognisedin“Othercompre-hensiveincome”.

Fair value measurements Forfinancialinstrumentsquotedinamarket,thecurrentpricesareusedformeasuringfairvalue.Iftherearenomarketquotationsforthe instrument, Nobia determines the fair value using normal valua-

tion techniques, using quoted prices of similar assets or liabilities in activemarkets.

An assessment is made at the end of each reporting period of whether the fair value of long-term loans deviates from the carrying amount and adjustments are made for any material deviation of fairvaluefromthecarryingamount.Forshort-termsloansandinvestments, the fair value is deemed to be the same as the carrying amount since a change in the market interest rate has no material impactonthemarketvalue.

Financial assets are initially measured at cost, and for certain instruments that are not measured at fair value, transaction costs areincluded.Financialassetsarerecognisedinthebalancesheetuntil the rights in the contract have been realised or the company nolongerhasarighttotheasset.Thefinancialassetsmeasuredatamortised cost are continuously assessed in accordance with the expectedlossmodeltoevaluatetheneedforanylossallowances.

Financial derivative instruments and other hedge measuresDerivative instruments are recognised in the balance sheet on the contract date and measured at fair value, both initially and when subsequentlyremeasured.Themethodforrecognisingthegainorloss arising on remeasurement depends on whether the derivative is designated as a hedging instrument, and whether it is a hedge of fairvalueorcashflow.Derivativesthatarenotidentifiedashedg-inginstrumentsareclassifiedinthebalancesheetasfinancialassetsandliabilitiesmeasuredatfairvaluethroughprofitorloss.Gains and losses due to changes in fair value are recognised in profitorlossunderfinancialitemsintheperiodinwhichtheyarise.

Hedge accountingTheGroupapplieshedgeaccountingunderIFRS9forfinancialinstrumentsaimedathedgingfuturecommercialcashflowsinfor-eigncurrencies.Whenthetransactionisenteredinto,theeconomicrelationship between the hedging instrument and hedged item, or transaction, is documented, as well as the risk management objec-tiveandstrategyforundertakingthehedge.TheGroupalsodocu-ments its assessment both at the start of the hedge and continu-ously as to whether the derivative instruments used in the hedge transactionareeffectiveintermsofoffsettingchangesinfairvalueorthecashflowofhedgeditems.Hedgesaredesignedinawaythattheyareexpectedtobeeffective,meaningthataneconomicrelationshipisexpectedtoexistbythehedginginstrumentoffset-tingchangesinfairvalueorthecashflowofhedgeditems.Theeco-nomic relationship is primarily determined through qualitative anal-ysisofcriticaltermsinthehedgingrelationship.Ifchangesincircumstancesaffectthehedgingrelationshipsuchthatthecriticalterms no longer match, the Group uses quantitative methods to assesseffectiveness.Sourcesofhedgeineffectivenessarestatedundereachhedgetype.TheGroupestablishesthehedgeratiobetween the hedging instrument and the hedged item based on the hedgeratiosexistingintheactualhedges.Thehedgeratiois1:1forall of the Group’s hedging relationships in which hedge accounting isapplied.Changesinthefairvalueofthehedginginstrumentthatdo not meet the criteria for hedge accounting are immediately rec-ognisedinprofitorloss.

Hedging future commercial cash flows in foreign currenciesTo hedge future forecast and contracted commercial currency flows,bothexternallyandinternallywithintheGroup,theGrouphasenteredintoforwardagreements.Theeffectiveportionofchanges in fair value of hedging instruments is recognised in other comprehensiveincome.ThegainorlossrelatingtoanyineffectiveportionisrecognisedimmediatelyinEBITinprofitorloss.Amountsaccumulatedinequityarereclassifiedtoprofitorlossintheperi-odswhenthehedgeditemaffectsprofitorloss,forexample,oncetheforecastexternalsalehastakenplace.Whenahedginginstru-ment expires or is sold or when the hedge no longer meets the crite-ria for hedge accounting, these are recognised at the same time as theforecasttransactionisultimatelyrecognisedinprofitorloss.Whentheforecasttransactionisnolongerexpectedtooccur,thecumulative gain or loss that was recognised in equity is immedi-atelyreclassifiedtoprofitorloss.Sourcesofhedgeineffectivenessinclude the impact of the parties’ credit rating on the measurement ofthehedginginstrumentandcashflowsthatdonotexactlymatchbetween the hedging instrument and the hedged commercial cash flows.TheGroupbelievesthatsourcesofhedgeineffectivenessare

Note 1 continued

Notes


not material given Nobia’s credit rating and counterparties, and the proceduresinplaceforreportingandmonitoringforecastflowsagainstoutcomes.TheGroupnormallyhedgesonlyaportionofforecastcashflows.

Loans defined as net investmentsThe Group has lending in foreign currency to certain subsidiaries forwhichtheloansrepresentapermanentpartoftheheadoffice’sfinancingofthesubsidiary.Theloansarerecognisedattheclos-ing-daterate,forwhichexchange-ratedifferencesontheloansarerecognisedinprofitorloss.

Cash and cash equivalentsCash and cash equivalents comprise cash funds and balances with banks and equivalent institutions with due days within three months from the acquisition date, and short-term liquid investments with maturities of less than three months from the acquisition date thatareexposedtoonlyaninsignificantriskoffluctuationsinvalue.Blockedfundsinbankaccountsarenotincludedincashandcashequivalents.

Impairment of financial assetsFinancial assets, apart from those measured at fair value through profitorloss,aresubjecttoimpairmentforexpectedcreditlosses.In addition, impairment also includes contract assets, loan commit-mentsandfinancialguaranteesthatarenotmeasuredatfairvaluethroughprofitorloss.ImpairmentofcreditlossesunderIFRS9isprospective and a loss allowance is established when there is an exposure to credit risk, usually in connection with initial recognition ofanassetorreceivable.Expectedcreditlossesreflectthepresentvalueofalldeficitsincashflowsattributabletodefaulteitherforthenext12monthsorforthefullexpectedlifetimeofthefinancialinstruments, depending on the class of asset and credit deteriora-tionsinceinitialrecognition.TheGroupdefinesdefaultasthefactthat it is considered unlikely that the counterparty will meet its obli-gationsduetoindicatorssuchasfinancialdifficultiesandmissedpayments.Regardless,defaultisconsideredtoexistwhenthepay-mentis361dayslate.TheGroupwritesoffareceivablewhennoopportunitiesforadditionalcashflowsaredeemedtoexist.Expectedcreditlossesreflectanunbiasedandprobabili-ty-weighted outcome that is determined by evaluating the range of possible outcomes based on reasonable and supportable fore-casts.Thesimplifiedmodelisappliedtoaccountsreceivable,leasereceivables,contractassetsandcertainotherfinancialreceiv-ables.Alossallowanceisrecognisedfortheexpectedfulllifetimeofthereceivableorasset.Athree-stageimpairmentmodelisappliedtootheritemssubjecttoexpectedcreditlosses.Initially,andonevery closing date, a loss allowance is recognised for the next 12 months, or for a shorter period of time depending on the expected life(stage1).Ifthecreditriskhasincreasedsignificantlysinceinitialrecognition, lifetime expected credit losses are recognised for the asset(stage2).Forassetsthatareconsideredtobecredit-im-paired, lifetime expected credit losses continue to be recognised (stage3).Forcredit-impairedassetsandreceivables,thecalcula-tion of interest income is based on the carrying amount of the asset, the net loss allowance, as opposed to the gross amount in theprecedingstages.Themeasurementofexpectedcreditlossesisbasedondifferentmethodsfordifferentcreditriskexposuresforeachmodel.Themethodforaccountsreceivable,contractassetsandcertainotherfinancialreceivablesisbasedonpastcreditlosslevelcombinedwithprospectivefactors.Leasereceivables,certainotherfinancialreceivablesandcashandcashequivalentsareimpairedaccordingtoarating-basedmethod.Expectedcreditlosses are measured at the total of probability of default, loss given defaultandexposureondefault.Bothexternalcreditratingsandinternallydevelopedratingmethodsareused.Themeasurementofexpected credit losses also considers any collateral and other creditenhancementintheformofguarantees.Thefinancialassetsare recognised in the balance sheet at amortised cost, meaning the netofgrossamountandthelossallowance.Changesinthelossallowancearerecognisedinprofitorlossascreditlosses.TheGroup’screditexposureisstatedinNotes2and28.

ImpairmentThe carrying amounts of the Group’s assets are tested annually for indicationsofanyimpairmentrequirement.IAS36isappliedfortheimpairmenttestingofassetsotherthanfinancialassets,whicharetestedaccordingtoIFRS9,assetsheldforresaleanddisposalgroupsthatarerecognisedaccordingtoIFRS5,inventories,planassetsusedforthefinancingofemployeebenefitsanddeferredtaxassets.Fortheexemptedassetsmentionedabove,thecarryingamountistestedinaccordancewiththerelevantstandard.

Impairment testing of tangible and intangible assets, and participations in subsidiariesIf there is an indication of an impairment requirement, the recover-ableamountoftheassetistestedinaccordancewithIAS36(seebelow).Forgoodwill,therecoverableamountiscalculatedannu-ally.Whentestingforimpairmentrequirements,ifitisnotpossibletoestablishessentiallyindependentcashflowsforanindividualasset, the assets must be grouped at the lowest level at which it is possibletoidentifyessentiallyindependentcashflows,knownascash-generatingunits.Impairmentlossesarerecognisedwhenthecarrying amount of an asset or a cash-generating unit (group of units)exceedstherecoverableamount.Impairmentlossesarechargedagainstprofitorloss.Impairmentlossesrelatedtoassetsattributable to a cash-generating unit are primarily allocated to goodwill.Subsequently,aproportionalimpairmentofotherassetsincludedintheunit(groupofunits)iseffected.Therecoverableamount is the higher of fair value less selling expenses and value in use.Whencalculatingthevalueinuse,futurecashflowsaredis-counted using a discounting factor that takes into account the risk-freeinterestrateandtheriskassociatedwiththespecificassetorcash-generatingunit(groupofunits).

Provisions Provisions are recognised in the balance sheet among current and long-term liabilities, when the Group has a legal or informal obliga-tion deriving from an occurred event and that it is probable that an outflowofresourceswillberequiredtosettletheobligationandtheamountconcernedcanbereliablyestimated.Aprovisiondiffersfrom other liabilities since the date of payment or the amount requiredtosettletheprovisionisuncertain.

RestructuringA provision for restructuring is recognised once a detailed and for-mal restructuring plan has been adopted and the restructuring pro-cesshaseithercommencedorbeenpubliclyannounced.Noprovi-sionsareestablishedforfutureoperatingexpenses.

GuaranteesA provision for guarantees is recognised when the underlying prod-uctsorservicesaresold.Theprovisionisbasedonhistoricaldataand a total appraisal of the potential outcomes in relation to the probabilitiesassociatedwiththeoutcomes.

Contingent liabilitiesA contingent liability is disclosed when the company has a possible obligation deriving from an occurred event whose existence will be confirmedonlybyoneormoreuncertainfutureevents,orwhenthere is an obligation that has not been recognised as a liability or provisionbecauseitisnotprobablethatanoutflowofresourceswillberequired,oralternativelybecauseitisnotpossibletosuffi-cientlyreliablyestimatetheamountconcerned.

Shareholders’ equityWhensharesareboughtback,shareholders’equityisreducedbytheentireamountpaid.DividendsarerecognisedasaliabilityaftertheAnnualGeneralMeetinghasapprovedthedividend.

Earnings per shareThe calculation of earnings per share is based on consolidated net profitattributabletotheParentCompanyshareholdersandontheweightedaveragenumberofsharesoutstandingduringtheyear.Whencalculatingearningspershareafterdilution,theaveragenumber of shares outstanding is adjusted to take into account the

Note 1 continued

Notes


dilutiveeffectsofpotentialordinaryshares.Duringtherecognisedperiods, potential ordinary shares comprise share rights (matching andperformancesharerights).Matchingsharerightsheldbyemployeesonthereportingdateareconsidereddilutive.Perfor-mancesharerightsaredilutivetotheextentthatprofittargetshavebeenfulfilledonthereportingdate.Tocalculatethedilutiveeffect,an exercise price for the share rights is applied that corresponds to the value of future services per outstanding share right calculated asremainingcosttorecogniseinaccordancewithIFRS2.

Employee benefitsPensionsTheGrouphasbothdefined-contributionanddefined-benefitpen-sionplans.InSweden,theUKandAustria,employeesarecoveredbydefined-benefitpensionplans.Inothercountriesandcompa-nies,employeesarecoveredbydefined-contributionplans.Effec-tive2010,allnewvestingintheUKcomesunderdefined-contribu-tionplans.

Plans for which the company’s obligations are limited to the fees thecompanyhasundertakentopayareclassifiedasdefined-con-tributionpensionplans.Thecompany’sobligationsfordefined-con-tribution plans are recognised as a cost in earnings at the rate at which they are vested by the employees performing services on behalfofthecompanyforaperiodoftime.TheGroup’sdefined-benefitpensionplansstatetheamountof

pensionbenefitthatanemployee,oraformeremployee,willreceive after retirement based upon their salary and the number of yearsofservice.Pensionliabilitiesfordefined-benefitplansarerecognised according to common principles and calculation meth-ods and are calculated by considering future salary increases and inflation,amongotherfactors.TheGroupcarriestheriskthatthepromisedbenefitwillbepaid.Therearebothfundedandunfundeddefined-benefitpension

planswithintheGroup.Fundedpensionplansaremainlyfinancedonthebasisofcontributionspaidtopensionfunds.Regardingdefined-benefitplans,thepensioncommitmentiscal-

culatedinaccordancewiththeProjectedUnitCreditmethod.Thismethod allocates the cost of pension at the rate at which the employees perform services for the company that increase their entitlementtofutureremuneration.Thiscalculationisperformedannuallybyindependentactuaries.Thecompany’sobligationsarevaluedatthepresentvalueofexpectedfuturecashflowsusingadiscountrate.Thisdiscountratecorrespondstotheinterestonhigh-qualitycorporatebonds,whereamarketwithsufficientdepthexists,orgovernmentbondsifnosuchmarketexists.

The rate in Sweden is determined based on mortgage bonds, whileintheUKandAustria,therateisbasedoncorporatebonds.

Actuarial gains and losses may arise when the present value of commitmentsisestablishedandadifferenceariseswhentheactual return on plan assets is established compared with the return calculated at the beginning of the period, based on the dis-countrateofthecommitments.Theseactuarialgainsandlossesandthisdifferentinthereturnonplanassetsareentitledremea-surements.Theseremeasurementeffectsariseeitherbecausethefairvaluediffersfromthepreviouslymadeassumptionorbecausetheassumptionshavechanged.Theremeasurementeffectsarerecognisedinothercomprehensiveincome.

For funded plans, the Group recognises pension commitments in the consolidated balance sheet as a liability comprising the net of the estimated present value of the commitments and the fair value ofplanassets.Fundedplanswithnetassets,thatis,planswithassetsexceedingthepensioncommitment,arerecognisedasfixedassets.

The net amount of interest on pension liabilities and the expected return on accompanying plan assets is recognised as part of net financialitems.

The special employer’s contribution comprises a portion of the actuarial assumptions and thus is recognised as a portion of the netcommitment/asset.Theportionofthespecialemployer’scontri-bution that is calculated based on the Swedish Pension Obligations Vesting Act in legal entities is recognised, for simplicity, as accrued expensesinsteadofasaportionofnetcommitment/asset.Taxonreturnsisrecognisedcontinuouslyinprofitorlossforthe

period to which the tax pertains and thus is not included in the lia-bilitycalculation.Forfundedplans,thetaxischargedtothereturn

onplanassetsandrecognisedinothercomprehensiveincome.Forunfundedorpartlyunfundedplans,taxischargedtoprofitorloss.

Other long-term remunerationThe Group operates schemes for remuneration of employees for longservice.

Actuarial gains and losses may arise when the present value of commitments and the fair value of plan assets are established, whicharerecognisedinoperatingprofit.

The discount rate is established on the basis of high-quality cor-porate bonds issued in the same currency as the remuneration that is to be paid and with maturities equivalent to the commitments in question.

Share-based remuneration schemesShare-basedremunerationpertainstoemployeebenefits,includ-ing senior executives in accordance with the Performance Share PlansthatNobiainitiatedin2019.Costsforemployeebenefitsarerecognised as the value of services received, allocated over the vesting periods for the plans, calculated as the fair value of the allottedequityinstruments(IFRS2).Thefairvalueisdeterminedonthe allotment date, or the date on which Nobia and the employees haveagreedonthetermsandconditionsoftheplans.Sincetheplansareregulatedwithequityinstruments,theyareclassifiedas“equity settled” and an amount corresponding to the recognised costforemployeebenefitsisrecogniseddirectlyinshareholders’equity(othercontributedcapital).ThePerformanceSharePlan2019requiresanemployee’sprivate

investmentinNobiashares.Attheendofthevestingperiod,theparticipants will be allotted shares in Nobia free of charge, pro-videdthatcertainconditionsarefulfilled.Theallotmentofsharesrequires that the performance targets related to average operating profit(EBIT)andtotalshareholderreturn(TSR)onthecompany’sshareshavebeenachieved.However,iftheEBITperformancetar-get has been achieved but the TSR target on the Nobia share is neg-ative,noallotmentwilltakeplace.Thesharerightsareallocatedfree of charge and to be entitled to receive shares under the share rights, it is required, with certain exemptions, that the participant remainsemployedwithintheNobiaGroup.Thesesharerightsaredivided into Series A and Series B according to the various perfor-mancetargetsunderthePerformanceSharePlan2019.Halfofeach participant’s allotment of share rights refers to Series A, and halftoSeriesB.Thenumberofsharerightscarryingentitlementtoallotmentdependsonfulfilmentoftheperformancetargetsthatapplyforeachseriesofshare.TheBoardhassetaminimumlevelandamaximumlevelforeachperformancetarget.Theallotmentofshare rights for Series A requires that target levels are achieved for averageoperatingprofitinthe2019-2021fiscalyears.Theallotmentof share rights for Series B requires that target levels during the period are achieved for annual average total shareholder return (TSR)ontheNobiashare.Ifthesetminimumlevelsfortheperfor-mance target are achieved, the share rights entitle the holder to receiveallotmentof25%.Iftheminimumlevelintherangeisnotachieved,thesharerightswillnotgiveentitlementtoanyallotment.If the maximum level is achieved, each share right gives entitlement to2-3.5sharesperseriesdependingontypeofposition.Allotmentbetween the minimum and maximum levels takes place straight-line basedontheintermediateamountsbetweenthetwolevels.

The total shareholder return (TSR) is a market condition that is includedintheinitialvaluationoftherelevantsharerights.Theexpense is recognised straight-line over the vesting period with a correspondingincreaseinshareholders’equity.Theexpensefortheshare rights is based on the fair value of the shares calculated by anexternalpartyusingaMonteCarlosimulation.Theamountrec-ognisedisnotassessedoradjustedfortheexpectedorconfirmedoutcomeduringthevestingperiod.Instead,theentirenumberofshare rights conditional on the share return forms the basis of the expenserecognition,regardlessofoutcome.Whensharerightsarevested and shares allotted, social security contributions are paid in certaincountriesforthevalueoftheemployee’sbenefits.Anexpense and a provision are recognised, allocated over the vesting period,forthesesocialsecuritycontributions.Theprovisionforsocial security contributions is based on the number of share rights that are expected to be vested and the fair value of the share rights oneachreportingdateandfinally,fortheallotmentofshares.Nonewperformanceshareplanwaslanunchedin2020.

Note 1 continued

Notes


Short-term remunerationShort-term remuneration of employees is calculated without dis-counting and is recognised as a cost when the related services are obtained.Aprovisionispostedfortheanticipatedcostofprofitshares and bonus payments when the Group has a current legal or informal obligation to make such payments, due to the services being obtained from the employees and it being possible to reliably estimatetheobligation.

Payments in connection with employment terminationAcostforpaymentsarisinginconnectionwiththelaying-offofemployees is recognised only if the company is legally obliged to terminateemploymentinadvanceofthenormaldate.Whensuchpaymentismadeasanofferingtoencouragevoluntaryretirement,itisrecognisedasacostifitisprobablethattheofferwillbeacceptedandthenumberofemployeeswhowillaccepttheoffer-ingcanbereliablyestimated.

Parent Company accounting policiesThe Parent Company has prepared its Annual Report in accor-dancewiththeSwedishAnnualAccountsAct(1995:1554)andtheSwedish Financial Reporting Board’s recommendation RFR 2 AccountingforLegalEntities.TheFinancialReportingBoard’sstate-mentsforlistedcompanieswerealsoapplied.RFR2entailsthattheParent Company applies all IFRSs adopted by the EU and state-ments to the Annual Report of the legal entity as far as possible under the framework of the Annual Accounts Act and the Swedish Pension Obligations Vesting Act and with respect to the connection betweenaccountingandtaxation.TherecommendationstatestheexceptionsandadditionstoIFRSthataretobemade.Overall,therecommendationentailsdifferencesbetweentheGroup’sandtheParentCompany’saccountingpoliciesintheareasstatedbelow.The accounting policies for the Parent Company described below were applied consistently to all periods presented in the Parent Company’sfinancialstatements.

Changed accounting policiesChanges to accounting policies applied from 2020 did not have anyeffectontheParentCompany’sfinancialstatements.

Classification and presentation formAn income statement and statement of comprehensive income are presentedfortheParentCompanyandtheGroup.TheParentCompany’s income statement and balance sheet are presented fol-lowing the format stipulated in the Annual Accounts Act, while the statement of comprehensive income, the statement of changes in shareholders’equityandcash-flowstatementarebasedonIAS1presentation of Financial Statements and IAS 7 Statement of Cash Flows.ThedifferencesintheParentCompany’sincomestatementand the balance sheet compared with the presentation of the con-solidatedfinancialstatementsprimarilypertaintotherecognitionoffinancialincomeandexpenses,fixedassets,shareholders’equity and the existence of provisions as a separate heading in the balancesheet.

SubsidiariesParticipations in subsidiaries are recognised in the Parent Com-panyinaccordancewiththecostmethod.Intheconsolidatedfinancialstatements,transactioncostsarerecogniseddirectlyinprofitorlosswhentheyarise.

Contingent consideration is valued based on the probability of theconsiderationbeingpaid.Anychangestotheprovisions/receiv-ableareaddedto/deductedfromthecost.Intheconsolidatedfinancialstatements,contingentconsiderationsaremeasuredatfairvaluewithchangesinvaluerecognisedinprofitorloss.

Bargain purchases corresponding to future losses and costs are reversed during the expected periods in which the losses and costs arise.Bargainpurchasesarisingforotherreasonsarerecognisedas a provision to the extent that the purchase does not exceed the fairvalueoftheacquired,identifiablenon-monetaryassets.Theportionthatexceedsthisfairvalueisrecognisedinprofitorlossimmediately.Theportionthatdoesnotexceedthefairvalueofacquired,identifiablenon-monetaryassetsisrecognisedinprofitor loss systematically over a period calculated as the remaining weightedaverageusefullifeoftheacquiredidentifiableassetsthataredepreciable.Intheconsolidatedfinancialstatements,bargainpurchasesarerecogniseddirectlyinprofitorloss.

Leased assetsAll leases in the Parent Company are recognised in accordance withoperatingleasesregulations.

Employee benefitsThe Parent Company applies other principles for the calculation of defined-benefitplansthanthosestipulatedinIAS19.TheParentCompany follows the provisions of the Pension Obligations Vesting Act and the Swedish Financial Supervisory authority’s regulations sincethisisaconditionforeligibilityforrightstotaxdeductions.ThesignificantdifferencescomparedwiththeIAS19regulationspertain to how the discount rate is determined, that the calculation ofdefined-benefitcommitmentsbasedoncurrentsalarylevelswithno assumptions regarding future salary increases and that all actu-arialgainsandlossesarerecognisedinprofitorlosswhentheyarise.

The Parent Company recognises the fair value of Performance Share Plans issued to employees of subsidiaries as shareholders’ contributions by recognition in shareholders’ equity and the value ofthesharesinthesubsidiary.

Group contributions The Parent Company applies the alternative rule to Group contri-butions paid and received and recognises these as appropriations inprofitorloss.Priorto2011,Groupcontributionswererecogniseddirectlyinshareholders’equity.

Anticipated dividendsAnticipated dividends from subsidiaries are recognised if the Par-ent Company has the sole right to decide the amount of the divi-dend and the Parent Company has made a decision on the amount of the dividend prior to the publication of the Parent Company’s financialstatements.

Note 1 continued

Notes


Note 2 Financial risks

Foreign exchange risk TheGroup’sfinancialpolicyformanagingfinancialriskshasbeenprepared by the Board and forms a framework of guidelines and rulesintheformofriskmandatesandlimitsforthefinanceopera-tions.ResponsibilityfortheGroup’sfinancialtransactionsandrisksismanagedcentrallybytheGroup’sfinancefunction,foundintheParentCompany.Theoverallobjectiveofthefinancefunctionistoprovidecost-efficientfinancingandtominimisenegativeeffectsontheGroup’searningsthatderivesfrommarketrisks.

Derivative instruments are held only for hedging purposes and notforspeculativetransactions.Nobia’soverallstrategyistoreduce the Group’s exchange-rate exposure linked to forecast pur-chases and sales of goods and uses derivative instruments in the formofcurrencyforwardcontractsforthispurpose.Ifderivativeinstruments do not meet the criteria for hedge accounting, they are measuredatfairvaluethroughprofitorloss.Derivativeinstrumentsthat meet the criteria for hedge accounting are designated as cash-flowhedgesandmeasuredatfairvaluewiththechangeinvalueinothercomprehensiveincomewiththeaccumulatedeffectinshareholders’equity.Thisreserveisreversedtoprofitorlosswhenthehedgedunderlyingtransactionstakeplace.Nobia’spolicyistohedgeapproximately80%oftheforecast

flows,0-3monthsinthefuture,60%4-6monthsinthefuture,40%7-9monthsinthefutureand100%ofcontractedprojects.Theprin-cipal currency combinations were the EUR against the GBP, the NOKagainsttheDKKandtheSEKagainsttheNOK.Totalexposurein2020,expressedinSEKandafteroffsettingcounteractingflows,amountedtoSEK2,442m(2,461),ofwhichSEK1,465m(2,174)washedged.Atyear-end2020,thehedgedvolumeamountedtoSEK1,079m(1,003).Unrealisedgainsandlossesrecognisedascash-flowhedges in shareholders’ equity will be transferred to the income statementatvariouspointsintimewithin12months.

Translation exposureThe Group’s policy is not to hedge translation exposure in foreign currencies.A10%strengtheningoftheSEKcomparedwithothercurrencies on 31 December 2020 would entail a decrease in share-holders’equityofSEK-472m(-545)andadecreaseinprofitofSEK-38m(-81).Thesensitivityanalysisisbasedontheassumptionthatallotherfactors(forexample,interest)areunchanged.Thesameconditionswereappliedto2019.

Credit risk Nobia is active in many markets and in several distribution chan-nels.Dependingonthetypeofdistributionchannel,thecustomerbasecomprisesbothprofessionalcustomersandconsumers.Forthese reasons, credit management and payment terms must be adapted to each business unit’s business logic and distribution channels within the framework of the credit policy established by theGroup.Thecreditpolicystipulatesthatcreditratingsaretobebased on at least one credit report from a reputable credit rating institute.Creditassessmentsarecontinuouslyperformedoncus-tomerswhomakeregularpurchases.Creditinsuranceisutilisedforcertainmarketsandcustomercategories.Collateralisoftenrequired when credit is granted to customers with low buying fre-quencies.Counterpartyriskpertainingtobanksisdeemedtobeveryminor.ThetotalcreditriskamountedtoSEK2,007m(1,737).Thecreditqualityoffinancialassetsthathaveneitherfallendueforpaymentnoraresubjecttoimpairmentishigh.

Financial exposure Nobia’spolicyforfinancingforeignassetsinvolvesfinancingcapi-tal employed with external borrowings in the corresponding cur-rencyinordertominimisetheimpactofexchange-ratefluctuationsonthedebt/equityratio.GrouploansarehandledbyNobia’sheadoffice.Theheadofficesuppliesthesubsidiarieswithfundsthroughaninternalbank.Theseloansareraisedinlocalcurrencies.Matched external borrowing or currency contracts minimise the

effectsofexchange-ratefluctuationsonearnings.Giventhecur-rent debt/equity ratio and currency distribution of capital employed,approximately35%offoreigncapitalemployedmustbefinancedthroughborrowinginlocalcurrencies.Incombinationwith this policy, other forms of capitalisation may be utilised in eachcountrytooptimisethecapitalstructureortaxsituation.Nobia’sfinancialexposurepolicydoesnotinvolvehedgingshare-holders’equity.

2019 2020

SEK m

Capital employed

per currency

Interest-bearing loans

and lease liabilities

Capital employed

per currency

Interest-bearing loans

and lease liabilities

SEK 232 1,379 -69 526EUR 1,404 228 1,465 241GBP 4,547 1,377 3,752 1,272DKK 1,813 1,045 1,611 956NOK 363 53 298 29Total 8,359 4,082 7,057 3,024

Interest-rate risk Interest-rate exposure is managed centrally, meaning that the head officeisresponsibleforidentifyingandmanaginginterest-raterisks.Nobianormallyusesshort,fixed-interestterms.Thefixed-in-teresttermforloanswasthreemonths.

Fixed-interest terms – borrowing

2019 2020

Group, SEK m0-3

monthstwo

yearsthree years

0-3 months

two years

three years

SEK 1,130 – – 285 – –

Refinancing risk NobiaappliesacentralisedapproachtotheGroup’sfinancing,whichmeansthatallfinancingtakesplaceinNobiaABorNobiaSverigeAB.InDecember2020,thecompanyalsoraisedasyndi-catedloanfacilitytotallingSEK5,000mwithtwobanks,whichreplacedthepreviousfacilityofSEK2,000m.ThetermisfiveyearsforSEK3,000mandthreeyearsforSEK2,000m.Theloanhastwocovenants: leverage (net debt to EBITDA), and interest cover (EBITDA tonetinterestexpenses).Nobiameetsallcovenantswithasatisfac-torymargin.Nobia’spolicyistoobtainlong-termlinesofcreditthatare compatible with Nobia’s long-term strategy, while simultane-ouslybalancingtheneedsforlowcreditcosts.Inadditiontotheseloans,Nobiahasaccesstolocalcashadvances.

The table below shows the maturity of all of Nobia’s loans:2019 2020 2020

Year of maturity 2023 2023 2025Loansandlinesofcredit, SEK m 2,000 2,000 3,000Of which utilised, SEK m 1,130 285 0

Capital management Dividendsare,onaverage,tobewithintheintervalof40-60%ofnetprofitaftertax.Thedebt/equityratioatyear-endamountedto59%(89).Nobiaconsidersrecognisedshareholders’equityofSEK4,034m(4,277)tobecapital.

Liquidity risk Daily liquidity is tracked with the help of carefully prepared liquid-ityforecasts.Liquidityiscontrolledcentrallywiththeaimofusingavailableliquidityeffectively,atthesametimeasnecessaryreservesareavailable.Availableliquidityincludingunutilisedover-draftfacilitiescomprisedSEK5,699m(1,485).

Notes


Commercial exposure2019 2020

USD EUR NOK SEK DKK USD EUR NOK SEK DKK

Currency contracts on closing dateLocalcurrency 1 57 -153 4 40 – 57 -139 3 35Total, SEK m1) 11 597 -162 4 56 – 573 -133 3 48Fair value, SEK m 0 -16 -3 -1 -1 – -10 -4 -5 -2Net flow calendar yearNetflow,localcurrency -5 -1313 319 -76 -142 -3 -864 422 -46 -128Netflow,SEKm2) -43 -1,3873 342 -76 -202 -29 -9134 413 -46 -181Hedged volume, SEK m2) -19 -1,261 323 -42 -104 -13 -917 -241 -1 -931)Flowsrestatedatclosing-daterate,SEK.2)Restatedataverageratein2019,2020.3)Inaddition,EUR31mpertainstoflowsagainstDKK,correspondingtoSEK332m. 4)Inaddition,EUR47mpertainstoflowsagainstDKK,correspondingtoSEK495m.

Sensitivity analysis2019 2020

Currencies1 and interest rates2 Change

Impact on profit before

tax, SEK m

Impact on shareholders’

equity3, SEK m Change

Impact on profit before

tax, SEK m

Impact on shareholders’

equity3, SEK m

EUR/SEK 5% 12.1 9.5 5% 11.0 8.7SEK/NOK 5% 8.7 6.8 5% 7.7 6.0EUR/GBP 5% 28.3 23.5 5% 25.8 21.4NOK/DKK 5% 12.6 9.8 5% 9.3 7.3SEK/DKK 5% 8.2 6.4 5% 6.8 5.3Interest-rate level 100points 11.3 8.9 100points 2.9 2.21)Transactioneffectsafterhedges.2)Afterinterest-ratehedging.3)Correspondstoprofitaftertax.

Analysis of maturity for financial liabilities including accounts payable2019 2020

Group, SEK m Currency TotalWithin

1 month1-3

months

3 months -1 year

1-5 years

5 years or

longer TotalWithin

1 month1-3

months

3 months -1 year

1-5 years

5 years or

longer

Bank loans (IB)Bank loans SEK 1,158 1 1 6 1,150 – 291 0 0 2 289 –Other liabilitiesForward agreements1) SEK 2 0 1 1 – – 5 0 2 3 – –Forward agreements1) EUR 17 2 5 10 – – 10 2 3 5 – –Forward agreements1) NOK 3 0 1 2 – – 4 0 2 2 – –Forward agreements1) DKK 1 0 0 1 – – 2 0 1 1 – –Forward agreements1) USD 0 0 0 0 – – – – – – – –Currency swaps2) 1 – 1 – – – 5 – 5 – – –Other liabilities (IB) DKK 4 0 0 3 1 – – – – – – –Other liabilities (IB) NOK – – – – – – 1 – 1 – – –Accounts payable and other liabilities SEK 1,557 1,070 321 82 84 – 1,956 1,264 368 205 119 –Total 2,743 1,073 330 105 1,235 – 2,274 1,266 382 218 408 –Interest-bearing liabilities (IB) 1,134 2851)Thevalueofforwardagreementsisincludedintheitem“Derivativeinstruments”inthebalancesheet.2)Recognisedunderotherliabilities.3)2020financialleaseliabilitiesarerecognisedinNote15.

Note 2 continued

Notes


Age analysis, accounts receivable and other receivables2019 2020

SEK m GrossOf which expected

credit losses

Of which

impairment GrossOf which expected

credit losses

Of which

impairment

Non-due accounts receivable 1,122 4 – 1,008 5 –Pastdueaccountsreceivable0-30days 173 1 0 102 1 1Past due accounts receivable >30days-90days 92 0 4 65 – 3Past due accounts receivable>90days-180days 29 0 6 66 – 8Past due accounts receivable >180days-360days 20 0 9 31 – 15Pastdueaccountsreceivable>360days 27 0 8 42 – 7Past due accounts receivable 1,463 5 27 1,314 6 34

Deposit account for expected credit losses and impairment of accounts receivable and other receivables

SEK m 2019 2020

Opening balance 27 32Reversal of previously recognised impairment losses -3 8Changed assessment of expected credit losses -1 -1Impairment for the year 20 -7Confirmedlosses -12 7Translationdifferences 1 2Closing balance 32 41

Credit quality is essentially deemed to be high for outstanding accountsreceivable.Therewasnosignificantconcentrationofcreditexposureontheclosingdate.Themaximumexposureforcreditriskisseeninthecarryingamountinthestatementoffinan-cialpositionforeachfinancialasset.From2018,Nobiabasesanyimpairment on a model for expected credit losses and impairment is nolongerbasedsolelyonpastevents.However,impairmentofaccounts receivable may continue if unforeseen events have occurred.Suchimpairmentisinitiallyrecognisedforeachindivid-ual receivable, but may also be made collectively for a group of receivablesofsimilarcreditcharacteristics.Whencalculatingexpected credit losses, Nobia takes into consideration historical bad debt losses, an analysis of the respective customer segments, andobservedmacroeconomiceffectsoncustomers’conditionssuchastheimpactofBrexitonthelocalmarket.Inthetableabove,SEK6m(5)referstoexpectedcreditlossesandSEK34m(27)toreservedreceivables.

Offsetting of financial instrumentsNobia has binding framework agreements for derivatives trading, whichentailsthatfinancialliabilitiescanbeoffset–or“netted”–intheeventofinsolvencyorasimilarsituation.Thetablesbelowshowthe amounts encompassed by netting agreements on 31 December 2020and31December2019.

Offset agreements2020 SEK m

Financialassets

Financialliabilities

Recognised amounts in statement of financialposition 1 26Amounts encompassed by netting -1 -1Amounts after netting 0 25

2019 SEK m

Financialassets

Financialliabilities

Recognised amounts in statement of financialposition 5 24Amounts encompassed by netting -5 -5Amounts after netting 0 19

Note 2 continued

Notes


Note 3 Operating segments and Net salesThe Group’s business activities are divided into operating segments based on a management approach, meaning the parts of the oper-ationsmonitoredbythecompany’schiefoperatingdecision-maker.The Group’s operations are organised such that Group manage-mentmonitorstheearnings,returnsandcashflowgeneratedbytheGroup’sregions.TheseregionscomprisetheGroup’soperatingsegments since Group management monitors the operations’ earn-ings and decides on the allocation of resources based on the

regions.Accordingly,theGroup’sinternalreportingisstructuredsothat Group management can monitor the performance and earn-ingsofalloftheregions.Thefollowingoperatingsegmentswereidentified:Nordicregion,UKregionandCentralEuroperegion.

Nobia considers the Group’s income from kitchens, bathrooms and storage to comprise a single product group since bathrooms and storage represent such a small percentage of the Group’s total balancesheet,incomestatementandcash-flowstatement.

Net sales and profit by regionNordic region

UK region



SEK m 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020

Net sales from external customers 6,753 6,801 5,902 4,649 1,275 1,291 – – 13,930 12,741Net sales from other regions 0 0 – – 0 0 0 0 – –Total net sales 6,753 6,801 5,902 4,649 1,275 1,291 0 0 13,930 12,741Depreciation/amortisation -332 -322 -408 -415 -64 -65 -34 -50 -838 -852Operatingprofit 886 765 345 -234 98 143 -197 -237 1,132 437Operatingprofitexcludingitems affectingcomparability 886 897 345 -226 98 143 -197 -233 1,132 581Financial income 1 7Financial expenses -94 -91Profit before tax 1,039 353

Impairment 1 -112 2 – – – – -25 3 -137

Total liabilities and assets per regionNordic region

UK region



SEK m 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020

Total operating assets 3,212 2,939 4,283 3,590 595 558 2,4931 2,3611 10,583 9,448Total operating assets include:Investmentsinfixedassets 172 98 177 86 29 26 87 98 465 308Total operating liabilities 1,298 1,544 881 1,133 172 198 1362 1522 2,487 3,0271)PrimarilycomprisesgoodwillofSEK1,934m(2,072),consolidatedsurplusvaluesonfixedassetsofSEK63m(65)andfixedassetsintheParentCompanyofSEK204m(177).EliminationofinternalreceivablesamountedtoSEK-18m(-26).

2)EliminationofinternalliabilitiesamountedtoSEK-18m(-26).

Geographic areas, GroupIncome from external customers1) Fixed assets2) Right-of-use assets

SEK m 2019 2020 2019 2020 2019 2020

Sweden (domicile) 1,629 1,653 442 359 64 51Denmark 2,709 2,898 727 657 1,058 966Norway 1,357 1,295 185 158 56 33Finland 1,022 924 142 123 12 47UK 5,906 4,650 2,484 2,209 1,198 961Germany 51 51 1 – – –Netherlands 733 757 558 532 155 136Austria 445 442 376 353 6 6Other countries 78 71 – – – –Total 13,930 12,741 4,915 4,391 2,549 2,2001)Netsalesfromexternalcustomersbasedoncustomers’geographicdomicile.2)Fixedassetsthatarenotfinancialinstruments,deferredtaxassets,assetsassociatedwithbenefitsafteremploymentterminationorrightsunderinsuranceagreements.

Notes


Comparative data per product groupNet sales per product group, % Nordic region UK region Central Europe region Group

2019 2020 2019 2020 2019 2020 2019 2020

Kitchen furnishings 67 67 62 62 60 58 64 64Installation services 6 6 6 6 11 10 6 6Other products 27 27 32 32 29 32 30 30Total 100 100 100 100 100 100 100 100

Nobia recognises revenue when control of the goods has passed to thecustomer.Revenueforkitchenproductsandotherproductsisrecognised at a point in time, while installations are recognised overtimeastheinstallationisperformed.Installationservicescom-priseabout6-7%ofNobia’stotalsales.

Nobia does not have any contract assets but contract liabilities exist in the form of advance payments from customers for the deliv-eryofkitchenproductsorinstallation.Thetermofadvancepay-

ments is less than one year and the closing balance on 31 Decem-ber2020amountedtoSEK140m(138).AdvancepaymentsarerecognisedasrevenuewhenNobiahassatisfieditobligationtothecustomer in the form of delivered kitchen products or completed installation.Thecontractliabilitiesthatexistedinthebalancesheeton31December2019wererecognisedasrevenueinthe2020fiscalyear.

Note 4 Costs for employee benefits and remuneration to senior executives

2019 2020

SEK m

Salaries and other

remunerationSocial

security costs Total

Salaries and other

remunerationSocial

security costs Total

Total subsidiaries1 2,681 547 3,228 2,681 536 3,217–ofwhichpensioncosts – 254 254 – 172 172Parent Company1 69 41 110 88 46 134–ofwhichpensioncosts – 21 21 – 23 23Group1 2,750 588 3,338 2,769 582 3,351–ofwhichpensioncosts – 275 275 – 195 1951)Excludescostsforshare-basedremuneration.

Total costs for employee benefitsSEK m 2019 2020

Salaries and other remuneration 2,750 2,769Social security costs 313 387Pensioncosts–defined-contributionplans 235 161Pensioncosts–defined-benefitplans 30 23Costs for special employer’s contributions and tax on returns from pension 10 11Costs for the Performance Share Plan 2019-2022 5 6Total costs for employees 3,343 3,357

Salaries and other remuneration for the Parent CompanySEK m 2019 2020

Senior executives1 16 17Other employees 53 71Total Parent Company2 69 881)In2020,thenumberofindividualswas5(4).2)Excludescostsforshare-basedremuneration.

Salaries and other remuneration for subsidiariesSEK m 2019 2020

Presidents of subsidiaries1 36 39Other employees of subsidiaries 2,645 2,642Total subsidiaries2 2,681 2,6811)In2020,thenumberofindividualswas12(13).2)Excludescostsforshare-basedremuneration.

Note 3 continued

Notes


Remuneration and other benefits, 2020

Basic salary,

Directors’ fees

Variable remunera-

tionOther

benefitsPension

costs

Share-based

remunera-tion

Other remu-neration Total

Pension commit-

ments

Chairman of the BoardNoraFørisdalLarssen (Chairmanfrom5May2020) 0.94 – – – – – 0.94 –Outgoing ChairmanHansEckerström(until5May2020) 0.40 – – – – – 0.4 –Board membersStefanJacobsson(until5May2020) 0.14 – – – – – 0.14 –JillLittle(until5May2020) 0.14 – – – – – 0.14 –George Adams 0.41 – – – – – 0.41 –Marlene Forsell (Chairman of the Audit Com-mitteefrom5May2020) 0.56 – – – – – 0.56 –Arja Taaveniku (member of Audit Committee from5May2020) 0.36 – – – – – 0.36 –JanSvensson(from5May2020) 0.27 – – – – – 0.27 –CarstenRasmussen(from5May2020) 0.27 – – – – – 0.27 –PresidentJon Sintorn 7.77 4.84 0.12 2.46 – – 15.19 –Other members of Group management1 23.55 7.04 1.40 6.28 – – 38.27 0.1–ofwhom,fromsubsidiaries2 14.34 3.88 1.13 3.40 – – 22.75 0Total 34.81 11.88 1.52 8.74 – – 56.95 0.11)Numberofindividuals8. 2)Numberofindividuals5.

Remuneration and other benefits, 2019

Basic salary,

Directors’ fees

Variable remunera-

tionOther

benefitsPension

costs

Share-based

remunera-tion

Other remu-neration Total

Pension commit-

ments

Chairman of the BoardHans Eckerström 1.10 – – – – – 1.10 –Board membersNoraFørisdalLarssen (member of Audit Committee) 0.49 – – – – – 0.49 –LilianFossumBiner(ChairmanofAudit Committeeuntil2May2019) 0.14 – – – – – 0.14 –Stefan Jacobsson 0.38 – – – – – 0.38 –RicardWennerklint(until2May2019) 0.10 – – – – – 0.10 –ChristinaStåhl(until2May2019) 0.10 – – – – – 0.10 –JillLittle 0.38 – – – – – 0.38 –George Adams 0.38 – – – – – 0.38 –Marlene Forsell (Chairman of the Audit Committeefrom2May2019) 0.37 – – – – – 0.37 –PresidentJonSintorn(from1Sept2019) 2.56 – 0.03 0.98 0.49 – 4.06 –MortenFalkenberg(until1Sept2019) 5.26 – 0.12 1.58 – – 6.96 –Other members of Group management1 29.81 1.59 1.93 6.57 1.49 – 41.39 1.40–ofwhom,fromsubsidiaries2 21.15 1.59 1.62 3.62 1.03 – 29.01 1.01Total 41.07 1.59 2.08 9.13 1.98 – 55.85 1.401)Numberofindividuals11. 2)Numberofindividuals7.

The average number of employees and number of men and women amongBoardmembersandseniorexecutivesaredescribedinNote5.

Remuneration to senior executives – Board and Chairman of the Board Remuneration to the Chairman and members of the Board is deter-minedbyresolutionstakenattheAnnualGeneralMeeting.Boardmembers who are employed by Nobia do not receive a separate Directors’fee.BoardmemberselectedbytheAnnualGeneralMeet-ingreceivedafixedfeeofSEK410,000permemberandtheChair-manreceivedSEK1,200,000.Inaddition,theChairmanoftheAuditCommitteereceivedSEK150,000andCommitteemembersSEK125,000.TheBoardreceivedatotalofSEK3,489,334.EmployeerepresentativesreceiveastudyandpreparationfeeofSEK26,000perpersonperyear.

– President Inthe2020fiscalyear,PresidentJonSintornreceivedSEK7,891,308insalaryandbenefits,plusavariablesalaryportionrelatedtotheresultsfor2020ofSEK4,837,149.Inadditiontothenormal pension in accordance with the Swedish National Insurance Act(ATPandAFP),thePresidenthaspensionbenefitscorrespond-ingto30%ofpensionablesalary.Pensionablesalarymeansfixedannualsalary.For2020,thepremiumcostforthePresidentwasSEK2,342,400.Theageofretirementis65.ThePresidenthastherightto12months’noticeifemploymentisterminatedbyNobia.Ifemployment is terminated by the President, six months’ notice must begiven.

– Other Group management Group management, which comprised seven individuals (11) at the end of 2020, of whom four (three) are employed in the Parent Com-pany,receivedsalariesandbenefitsduringthefiscalyearamount-

Note 4 continued

Notes


ingtoSEK24,956,779plusvariablesalaryportionsbasedontheresultsfor2020ofSEK7,043,392.GroupmanagementhastherighttoITPpensionsoranequivalentscheme.Theageofretirementis65.In addition, management in Sweden has the right to an increased occupational pension premium of 20% on salary portions amount-ingtomorethan30basicamounts,followingaBoarddecision.

– Variable salary portion The fundamental principle for the variable salary portion for the unit managers and Group management is that such portions may amount toamaximumbonusof40%offixedannualsalary.Theexceptiontothis principle is the President, whose variable salary portion may amounttoamaximumof65%offixedannualsalary.Exceptionsmayalso be made for other senior executives following a resolution by the Board.Thevariableportionisbasedonanearningperiodofoneyear.The outcome depends on the extent to which predetermined targets aremet.ThetargetsforthePresidentaresetbytheBoardofDirec-tors.ThePresidentsetsthetargetsforotherseniormanagersfollow-ingrecommendationsfromtheBoardRemunerationCommittee.

– Remuneration Committee The Board of Directors appoints a Remuneration Committee from withinitsranks.TheCommittee’stasksincludepreparingproposalswith respect to remuneration for the President, and to reach decisions on remuneration proposals for managers that report directly to the President.

– Group management’s employee contracts The contracts include provisions regarding remuneration and ter-minationofemployment.Undertheseagreements,employmentmay be terminated by the employee with a six-month period of noticeandbythecompanywitha12-monthperiodofnotice.

Performance Share Plan 2019Aresolutionwasmadeatthe2019AnnualGeneralMeetinginaccordance with the Board’s proposal to establish a remuneration schemeintheformofaPerformanceSharePlan.ThePerformanceSharePlan2019comprisesapproximately100employeesconsist-ing of senior executives and senior managers within the Nobia Group.Participationintheplanrequiresanemployee’sprivateinvestmentinNobiashares.Attheendofthevestingperiod,theparticipants will be allotted shares in Nobia free of charge, pro-videdthatcertainconditionsarefulfilled.Theallotmentofsharesrequires that the performance targets related to average operating profit(EBIT)andtotalshareholderreturn(TSR)onthecompany’sshareshavebeenachieved.However,iftheEBITperformancetar-

get has been achieved but the TSR target on the Nobia share is neg-ative,noallotmentwilltakeplace.The share rights are allocated free of charge and to be entitled to receive shares under the share rights, it is required, with certain exemptions, that the participant remains employed within the Nobia Group.Theparticipantsarenotentitledtotransfer,pledgeordis-pose of the share rights or exercise any shareholders’ rights regard-ingthesharerightsduringtheVestingPeriod.IfNobiaissuesadivi-dend to shareholders, the participants of the Performance Share Plan2019willbecompensatedbyincreasingthenumberofsharesthateachsharerightcarriesentitlementto.Thesesharerightsaredivided into Series A and Series B according to the various perfor-mancetargetsunderthePerformanceSharePlan2019.Thenumberof share rights carrying entitlement to allotment depends on the ful-filmentoftheperformancetargetsthatapplyforeachseriesofshare.TheBoardhassetaminimumlevelandamaximumlevelforeachperformancetarget.TheallotmentofsharerightsforSeriesArequiresthattargetlevelsareachievedforaverageoperatingprofitinthe2019-2021fiscalyears.TheallotmentofsharerightsforSeriesB requires that target levels during the period are achieved for annualaveragetotalshareholderreturn(TSR)ontheNobiashare.For the President of the company, each Saving Share carries entitle-menttoamaximumofsevensharerights.ForothermembersofGroupmanagement, each Saving Share entitles the holder to a maximum of sixsharerights.Forotherseniorexecutivesandmanagers,eachSav-ingShareentitlestheholdertomaximumoffoursharerights.Allotmentof Nobia shares shall normally take place within two weeks of the announcementofNobia’sinterimreportforthefirstquarterof2022.

Performance Share Plans 2019-2022

Vesting period May2019-April/May2022Performance targets Averageoperatingprofit(EBIT)and

total shareholder return (TSR) 2019-2022

Fair value per share right SEK42.04andSEK16.30,respec-tively

Accumulatedearningspershareareadjustedforitemsaffectingcomparability.Thefairvalueiscalculatedasthesharepriceontheplan’s date of the allotment, in May at the start of the vesting period, reduced by the present value of expected dividends during thevestingperiod.

Performance Share Plan 20Nonewperformanceshareplanwaslaunchedin2020.

20The costs of the Performance Share Plans are presented in the table below:

Accumulated costs 20191 20202

Plan IFRS 23 cost Social security

contributionsTotal cost IFRS 23 cost

Social security contributions

Total cost IFRS 23 cost

Social security contributions

Total cost

2019-2022 9 2 11 4 1 5 5 1 69 2 11 4 1 5 5 1 6

1)Priceon31December2019=SEK70.22pershare2)Priceon31December2020=SEK66.12pershare3)SeeNote1.

Changes in the number of outstanding share rights are as follows:

No. of share rights 2019 2020

Asper1January – 790,486Allotted 792,134 –Forfeited -1,648 -202,764As per 31 December 790,486 587,7221)Noexercisetookplacein2019or2020.

Outstanding share rights at year-end had the following expiry dates:No. of share rights

Expiry date 2019 2020

April/May2022 790,486 587,722790,486 587,722

Note 4 continued

Notes


Note 5 Average number of employees

2019 2020

Subsidiaries in:

Average number of

employeesOf whom,

men

Average number of

employeesOf whom,

men

Sweden 700 485 703 493Denmark 1,261 950 1,232 948Norway 224 101 214 97Finland 380 264 337 228Germany 2 2 1 1Austria 351 271 339 266UK 2,887 2,162 2,785 2,074Netherlands 299 225 299 226Total subsidiaries 6,104 4,460 5,910 4,333Parent Company 57 34 67 42Group 6,161 4,494 5,977 4,375

2019 2020Number on

closing dateOf whom,

men, %Number on


men, %

Board members 65 82 65 78Presidents and other senior executives 125 83 100 82Group 190 83 165 81

2019 2020Number on


men, %Number on


men, %

Board members 9 56 10 60Presidents and other senior executives 12 92 5 60Parent Company 21 76 15 60

Note 6 Remuneration to auditors

Specification by type of costsGroup Parent Company

SEK m 2019 2020 2019 2020

Deloitte ABAudit assignment 7 7 1 1Audit activities other than audit assignment 0 0 0 0Tax advice 1 1 0 0Other assignments 0 0 0 0

Audit assignment refers to the statutory audit of the annual and consolidatedfinancialstatementsandaccounting,theadministra-tion of the Board and the President and other examinations per-formedbyagreementorcontract.Thisincludesotherdutiesthatfall upon the company’s auditor to perform and providing advisory services or other assistance due to observations made during such anauditorwhileperformingothersuchduties.

Note 7 Depreciation/amortisation and impairment by activity

Depreciation/amortisation Impairment

Group, SEK m 2019 2020 2019 2020

Cost of goods sold -234 -241 – -105– of which, right-of-use assets -77 -78 – –Selling expenses -528 -519 3 –– of which, right-of-use assets -403 -409 – –Administrative expenses -76 -92 – -32– of which, right-of-use assets -11 -23 – –Total depreciation/amor-tisation and impairment -838 -852 3 -137– of which, right-of-use assets -491 -510 – –

Note 8 Other operating income

Group Parent Company SEK m 2019 2020 2019 2020

Gainsonsaleoffixedassets 18 9 – –Gains on sale of stores 22 5 – –Exchange-rate gains from operating receivables/lia-bilities 308 467 6 8Rental income 65 70 – –Government assistance – 148 – –Other 19 4 – –Total other operating income 432 703 6 8

Note 9 Other operating expenses

Group Parent CompanySEK m 2019 2020 2019 2020

Exchange-rate losses from operating receivables/lia-bilities -300 -441 -4 -9Lossattributabletosaleoffixedassets -1 -5 – –Non-recurring costs for defined-benefitplansinUK – -8 – –Other -11 -29 – –Total other operating expenses -312 -483 -4 -9

Note 10 Specification by type of cost

SEK m 2019 2020

Costs for goods and materials -5,527 -5,140Costs for remuneration of employees -3,322 -3,347Depreciation/amortisation and impairment(Note7) -835 -989Freight costs -743 -694Other operating expenses -2,803 -2,837Total operating expenses -13,230 -13,007

Notes


Note 11 Financial income and expenses


Profit from participations in Group companiesDividends – – 500 –Financial incomeInterest income, current 1 2 15 11Exchange-ratedifferences 0 5 65 0Financial expensesInterest expense -18 -26 -10 -8Interest expense for leases -55 -48 0 0Interest expense pertain-ing to pension liabilities -21 -17 0 0Exchange-ratedifferences 0 0 0 -194Total -93 -84 570 -191

Note 12 Tax on net profit for the year


Current tax expenses for the period -223 -137 – -1Deferred tax -6 37 0 0Tax on net profit for the year -229 -100 0 -1

Reconciliation of effective tax, Parent Company, % 2019 2020

Tax rate in the Parent Company 21.4 21.4Taxes attributable to earlier periods – -0.4Non-tax deductible income – -10.4Non-deductible costs 0.1 -1.5Non-tax deductible dividend -22.1 –Non-capitalised loss carryforwards 0.6 –Recognised effective tax 0.0 9.1

ThedifferencebetweenthenominalandeffectivetaxratesfortheParent Company primarily pertains to interest transfers and non-deductiblecosts.TaxexpenseonnetprofitfortheyearfortheGroupcomprised

28.3%ofprofitbeforetax.In2019,taxexpenseaccountedfor22.0percentofprofitbeforetax.ThecorporationtaxrateinSwedenwillbeloweredto20.6%in2021.Nobia’sdeferredtaxliabilitiesandassets from this country are thus recognised at the new tax rate as per31December2020,withamarginaleffectintheincomestate-mentandthebalancesheet.Thedifferencebetweenrecognisedtax(28.3%)andanticipatedtaxinconsolidatedprofitbeforetaxcalculatedusingthelocaltaxrateforSweden(21.4%)isexplainedinthetablebelow.

Reconciliation of effective tax Group, % 2019 2020

LocaltaxrateinSweden 21.4 21.4Differentlocaltaxrates 1.7 5.7Taxes attributable to earlier periods 0.0 -1.5Non-tax deductible income -5.0 -3.2Non-deductible costs 3.9 6.4Non-capitalised loss carryforwards 0.7 -0.5Utilisation of previously unrecognised loss carryforwards -0.6 –Changed tax rate -0.1 –Recognised effective tax 22.0 28.3

Note26explainsthecalculationofdeferredtaxassetsandliabili-ties.

Note 13 Intangible assets

GroupGoodwill, SEK m 2019 2020

Opening carrying amount 2,887 3,042Acquisition of operations 13 –Sale of stores -2 –Translationdifferences 144 -212Closing carrying amount 3,042 2,830

Impairment testing of goodwillAttheendof2020,recognisedgoodwillamountedtoSEK2,830m(3,042).Thecarryingamountofgoodwillisspecifiedbycash-gen-erating units as follows:

GroupSEK m 2019 2020

Nobia UK 1,739 1,579Nobia DK 354 343Nobia SweNo 161 151Bribus 471 453Other 317 304Total 3,042 2,830

Goodwill has been allocated to cash-generating units (CGU) when theseunitswereacquired.NobiahassixCGUs,whichinorganisa-tionaltermscorrespondtothecompany’sbusinessunits.Goodwillis subject to an annual impairment test by calculating the expected recoverableamountofeachCGU.Therecoverableamountiscal-culatedastheexpectedcashflowdiscountedbyaweightedaver-agecostofcapital(WACC)aftertaxforeachCGU,whichformsthebasisforderivingthediscountratebeforetax.Therecoverableamount calculated in conjunction with this is compared with the carryingamount,includinggoodwill,foreachCGU.Foranalysisofthebusinesssituation,anumberofdifferenteco-

nomic indicators are used, as well as external and internal analysis ofthese.AssumptionsarebasedontheeffectsoftheGroup'slong-termstrategicinitiatives,whiche.g.includesdifferentiatedbrands,group-widerange,centralpurchasingandproductdevelopment.

The starting point of the calculation is the estimated future cash flowsbasedonthefinancialbudgetfortheforthcomingfiscalyear.A forecast for the next four years is prepared based on this budget and expectations regarding market trends in the years ahead, whichreflectpreviousexperiencesandexternalsourcesofinforma-tion.Whencalculatingtheexpectedcashflow,significantassump-

tions applied include expected sales growth, operating margin and workingcapitalrequirements.Demandforkitchenproductshashistoricallyfollowedtheeconomictrend.

- Expected market growth is based on a transition from the cur-renteconomicsituationtotheexpectedlong-termgrowth.Currentmarketsharehasbeenassumedforfutureperiods.

- The operating margin has been forecast to reach the average forthemostrecentbusinesscycleinfiveyears.Thetransitionfromthecurrentleveltothelevelhasbeenassumedtobelinear.Accounthas been taken of the company's assessments of capacity utiliza-tion.-Theforecastforpersonnelcostsisbasedonexpectedinflation,

a certain increase in real wages (historical average) and planned efficienciesinthecompany'sproduction(accordingtotheestab-lishedfive-yearplan).Inordertoextrapolatethecashflowsoutsidethefirstfiveyears,a

growthrateof2%(2)isappliedtoallCGUs.The weighted average cost of capital is calculated on the average

debt/equity ratio for large companies in similar industries and costsforborrowedandshareholders’equity.Thecostofsharehold-ers’ equity is determined on the basis of the assumption that all investors require at least the same level of return as for risk-free government bonds, with an additional risk premium for the esti-matedrisksassumedwhentheyinvestincash-generatingunits.The risk premium has been established based on the long-term his-torical return on the stock market for large companies in similar industriesbytakingintoconsiderationtheriskprofileofeachbusi-

Notes


nessunit.Therequiredreturnondebt-financedcapitalisalsocal-culated on the return on risk-free government bonds and by apply-ingaborrowingmarginbasedonanestimatedcompany-specificrisk.TherequiredreturnandtaxrateforeachCGUisinfluencedbytheinterestandtaxratesindifferentcountries.

In 2020, the Group’s weighted cost of capital before tax amountedto8.5%(7.1)andaftertaxto8.4%(5.9).Intotal,theuti-lisedcostofcapitalaftertaxfor2020iswithintheintervalof8.0-8.8%(4.5-8.3).

The increase in the Group's weighted cost of capital before tax is due to a mix of underlying changed assumptions in the capital mar-ket such as risk premiums and beta values, but also to certain minor changesinspecificassumptionsfortheGroup.Takentogether,these changes have resulted in an increase for the Group between theyearsandforcertainunderlyingCGU's.Testingofgoodwilldidnotleadtoanyimpairmentin2020.Company management has made the assessment that reason-

able changes in important assumptions/key variables will not lead to the calculated total recoverable amount of the units being lower thantheirtotalcarryingamount.

GroupDiscount rate before tax, % 2019 2020

Nobia UK 9.6 8.9Nobia DK 5.2 8.0Nobia SweNo 9.4 9.0Other 9.8-10.5 8.1-8.3

GroupOther intangible assets, SEK m 2019 2020

Opening acquisition value 501 614Investments for the year 93 109Sales and scrapping -3 -75Reclassification 15 -12Translationdifferences 8 -19Closing accumulated acquisition value 614 617

Opening amortisation 317 382Sales and scrapping -3 -73Amortisation for the year 62 65Impairment for the year – 33Reclassification 0 0Translationdifferences 6 -11Closing accumulated amortisation 382 396Closing carrying amount 232 221Of which:Software 200 206Brands 0 0Licences 6 5Other 26 10Closing carrying amount 232 221

Note 14 Tangible fixed assets

GroupBuildings, SEK m 2019 2020

Opening acquisition value 1,523 1,642Investments for the year 76 48Sales and scrapping -19 -104Reclassification 0 1Translationdifferences 62 -95Closing acquisition value including written-up amount 1,642 1,492

Opening depreciation and impairment 992 1,090Sales and scrapping -12 -77Reclassification 0 0Depreciation for the year 74 67Impairment for the year – 46Translationdifferences 36 -61Closing depreciation and impairment 1,090 1,065Closing carrying amount 552 427Closing accumulated deprecation 1,088 1,019

GroupLand and land improvements, SEK m 2019 2020

Opening acquisition value 141 147Investments for the year 1 1Sales and scrapping -1 -6Reclassifications 1 0Translationdifferences 5 -7Closing acquisition value including written-up amount 147 135

Opening depreciation and impairment 22 23Sales and scrapping – -1Depreciation for the year 1 1Impairment for the year – 10Translationdifferences 0 0Closing depreciation and impairment 23 33Closing carrying amount 124 102Closing accumulated deprecation 23 23

GroupInvestments in progress, SEK m 2019 2020

Opening balance 127 149Investments initiated during the year 52 16Investments completed during the year1) -37 -15Translationdifferences 7 -9Closing carrying amount 149 1411)Assetsreclassifiedasothertangiblefixedassets.

GroupMachinery and other technical equipment, SEK m 2019 2020

Opening acquisition value 2,027 2,205Investments for the year 142 47Sales and scrapping -27 -11Reclassification 11 14Translationdifferences 52 -98Closing acquisition value including written-up amount 2,205 2,157

Note 13 continued

Notes


GroupMachinery and other technical equipment, SEK m 2019 2020

Opening depreciation and impairment 1,558 1,674Sales and scrapping -26 -11Reclassification 0 -1Depreciation for the year 103 102Impairment for the year – 48Translationdifferences 39 -76Closing depreciation and impairment 1,674 1,736Closing carrying amount 531 421Closing accumulated deprecation 1,666 1,685

GroupEquipment, tools, fixtures and fittings, SEK m 2019 2020

Opening acquisition value 1,255 1,294Investments for the year 98 85Sales and scrapping -113 -84Acquisition of operations 1 –Reclassification 10 10Translationdifferences 43 -75Closing acquisition value 1,294 1,230

Opening depreciation and impairment 954 1,011Sales and scrapping -74 -71Reclassification 0 -1Depreciation for the year 107 107Impairment for the year -3 0Translationdifferences 27 -61Closing depreciation and impairment 1,011 985Closing carrying amount 283 245Closing accumulated deprecation 977 953

Advance payments for tangible Groupfixed assets, SEK m 2019 2020

Opening balance 0 2Expenses during the year 3 2Translationdifferences -1 0Closing carrying amount 2 4

ImpairmentfortheyearfortangiblefixedassetsamountedtoSEK104m(-3).Minorreclassificationsweremadeduringtheyearbetweenclassesoffixedassets.

Not 15 Right-of-use assets

GroupLand and buildings, SEK m 2019 2020

Opening acquisition value 2,625 2,733New leases 126 279Terminated leases -131 -170Translationdifferences 113 -175Closing acquisition value 2,733 2,667

Opening depreciation and impairment – 394Depreciation for the year 405 413Terminated leases -12 -83Translationdifferences 1 -56Closing depreciation and impairment 394 668Closing carrying amount 2,339 1,999

GroupVehicles, SEK m 2019 2020

Opening acquisition value 159 268New leases 106 86Terminated leases -7 -36Translationdifferences 10 -23Closing acquisition value 268 295

Opening depreciation and impairment – 71Depreciation for the year 73 81Terminated leases -2 -32Translationdifferences 0 -8Closing depreciation and impairment 71 112Closing carrying amount 197 183

GroupOther, SEK m 2019 2020

Opening acquisition value 18 26New leases 7 22Terminated leases – -7Translationdifferences 1 -2Closing acquisition value 26 39

Opening depreciation and impairment – 13Depreciation for the year 13 16Terminated leases – -7Translationdifferences 0 -1Closing depreciation and impairment 13 21Closing carrying amount 13 18

For depreciation of right-of-use assets by activity, refer to Note 7 Depreciation/amortisation and impairment by activity

Analysis of terms for leasesNominal amount 2020

within 6 months

7 months –1 year

1-2 years

2-5 years

more than 5 years

Financial lease liabilities (IB) DKK 28 72 115 316 489Financial lease liabilities (IB) GBP 100 153 233 372 179Financial lease liabilities (IB) EUR 18 26 43 59 45Financial lease liabilities (IB) SEK 5 13 17 12 0Financial lease liabilities (IB) NOK 1 7 11 10 2Total 152 271 419 769 715

Nominal amount 2019

within 6 months

7 months –1 year

1-2 years

2-5 years

more than 5 years

Financial lease liabilities (IB) DKK 26 69 112 310 609Financial lease liabilities (IB) GBP 64 161 253 517 255Financial lease liabilities (IB) EUR 12 20 23 59 65Financial lease liabilities (IB) SEK 5 14 18 23 0Financial lease liabilities (IB) NOK 4 11 17 21 3Total 111 275 423 930 932

The Group deems the value of both low-value leases and short-term leasestobeinsignificant,whichiswhyinformationonexpensesfortheseleasesisnotpresented.Similarly,expensesattributabletovariableleasepayments,notincludingtheleaseliability,aredeemedtobeinsignifi-cant.InterestexpensesforleasesamountedtoSEK48m(55)fortheyear.

Note 14 continued

Notes


Note 16 Financial fixed assets

GroupOther long-term receivables, SEK m 2019 2020

Deposits 27 32Long-termloanstoretailers1 29 17Long-termreceivablesfromcustomers 44 43Other 5 4Total 105 961)OfwhichSEK0m(2)isinterest-bearing.

Parent CompanyShares and participations in Group companies, SEK m 2019 2020

Opening acquisition value 1,378 1,380Divestment – –Shareholders’ contribution – –Impairment of subsidiary shares – –Other changes 2 5Closing acquisition value 1,380 1,385

Note 17 Shares and participations in subsidiaries

Nobia AB’s holdings of shares and participations in operating Group companies, %.

Carrying amount

Corp. Reg. No. DomicileShare of equity,

% No. of shares 2019 2020

Nobia Sverige AB 556060-1006 Stockholm 100 100 1,256 1,256Nobia Nordic Supply Chain AB 559240-7414 Stockholm 100Nobia Fastighets Holding AB 559236-0043 Stockholm 100Nobia Fastighets AB 559247-1725 Stockholm 100Nobia Norway AS Trollåsen 100Kjøkkensenteret Rogaland AS Stavanger 100Nobia Production Sweden AB 556038-0072 Tidaholm 100Nobia Denmark A/S Ølgod 100HTH Kök Svenska AB 556187-3190 Helsingborg 100Nobia Denmark Retail A/S Ølgod 100Invita Retail A/S Ølgod 100Novart OY Nastola 100NobiaHolding(UK)Limited Darlington 100NobiaUKTrustee’sLtd Darlington 100MagnetLtd Darlington 100Magnet(IsleofMan)Limited Isle of Man 100MagnetGroupTrusteesLtd Darlington 100MagnetGroupLtd1 Darlington 100MagnetDistributionLtd1 Darlington 100Magnet&SouthernsLtd1 Darlington 100MagnetFurnitureLtd1 Darlington 100MagnetJoineryLtd1 Darlington 100MagnetManufacturingLtd1 Darlington 100MagnetRetailLtd1 Darlington 100MagnetSuppliesLtd1 Darlington 100MagnetIndustriesLtd1 Darlington 100MagnetKitchensLtd1 Darlington 100GowerGroupLtd Halifax 100GowerFurnitureLtd Halifax 100CharcoNinety-NineLtd Halifax 100RollfoldHoldingsLtd Dewsbury 100RollfoldGroupLtd Dewsbury 100RixonwayKitchensLtd Dewsbury 100CommodoreKitchensLtd Grays 100CIEUK(Holdings)Ltd Ingatestone 100CIEPLC Grays 100EssenzaInteriorsLtd1 Grays 100LoveneDörrAB1 556038-1724 Stockholm 100HTH Küchen GmbH Harrislee 100Swedoor Bauelementevertrieb Gmbh1 Herford 100Nobia Svenska Kök AB 556048-3256 Tidaholm 100 30,000 92 92ewe Küchen GmbH Wels 100 3 3BribusHoldingB.V. Amsterdam 100BribusB.V. Dinxperlo 100BribusExtraB.V. Dinxperlo 100Aannemings-enOnderhoudsbedrijfD.deJongB.V. Rotterdam 100Other 29 34Total 1,380 1,3851)Thecompanyisdormant.

Notes


Note 18 Derivative instruments

Group Parent Company

SEK m

Carrying amount

2020Fair value

2020

Carrying amount

2020Fair value

2020

Forward agreements, transactionexposure–assets 0 0 21 21Forward agreements, transactionexposure– liabilities -21 -21 -21 -21Total -21 -21 0 0

In addition to the forward agreements above, the company also has currency swaps at a carrying amount and fair value for assets ofSEK1m(3)andliabilitiesofSEK5m(1),whicharerecognisedunderotherassetsandliabilities.Unrealisedgainsandlossestotal-ling a net loss of SEK -12m in shareholders’ equity as per 31 Decem-ber2020willberecognisedinprofitorlossatdifferenttimeswithin12monthsoftheclosingdate.Forinformationaboutforwardagree-ments,seeNote2Financialrisks.Theprecedingyear’sunrealisedgainsandlossestotallinganetprofitofSEK12mwerereversedinprofitorlossintheirentiretyin2020.

Note 19 Prepaid expenses and accrued income


Prepaid rent – – 0 0Bonus from suppliers 108 115 35 36Accrued customer income 75 102 – –Prepaid bank charges 6 0 – –Insurance policies 8 11 3 3Other 118 85 46 42Total 315 313 84 81

Note 20 Cash and cash equivalents


Cash and bank balances 257 635 158 436

Unutilised overdraft facilities, which are not included in cash and cashequivalents,totalledSEK349m(359)intheGroup,andSEK249m(259)intheParentCompanyatyear-end.Inadditiontotheoverdraft facilities, the company has unutilised credit commitments ofSEK4,715m(870).

Note 21 Share capital

No. of registered shares

No. of shares outstanding

Asper1January2019 170,293,458 168,686,890Asper31December2019 170,293,458 168,852,821Asper31December2020 170,293,458 168,852,821

Bought-back own shares 2019 2020

Opening balance 1,606,568 1,440,637Divestments for the year -165,931 –Closing balance 1,440,637 1,440,637

ThesharecapitalamountstoSEK56,763,597(56,763,597).Theshare’squotientvalueisSEK0.33.Alloftheregisteredsharesarefullypaid.Allsharesareordinarysharesofthesametype.Nobiaowned1,440,637treasuryshares(1,440,637)on31December2020.

Bought-back shares are not reserved for issue according to the optionagreementorothersale.

Note 22 Reserves in shareholders’ equity

SEK mTranslation

reserveHedging

reserve Total

Openingbalance,1January2019 -173 2 -171Exchange-ratedifferences attributable to translation of foreign operations 241 – 241Cash-flowhedgesbeforetax1 – -19 -19Tax attributable to change in hedging reserve for the year2 – 4 4Closing balance, 31 December 2019 68 -13 55

Openingbalance,1January2020 68 -13 55Exchange-ratedifferences attributable to translation of foreign operations -399 – -399Cash-flowhedgesbeforetax1 – 1 1Tax attributable to change in hedging reserve for the year2 – -2 -2Closing balance, 31 December 2020 -331 -14 -3451)ReversalrecognisedinprofitorlossofSEK15m(-3).NewprovisionamountstoSEK-17m(-15).

2)ReversalrecognisedinprofitorlossofSEK-3m(1).NewprovisionamountstoSEK4m(3).

Translation reserve Thetranslationreserveincludesallexchange-ratedifferencesaris-inginconjunctionwiththetranslationoffinancialstatementsfromforeignoperationsthathavepreparedtheirfinancialstatementsinadifferentcurrencytothecurrencyinwhichtheconsolidatedfinancialstatementsareprepared.TheParentCompanyandGrouppresenttheirfinancialstatementsinSEK.

Hedging reserve Thehedgingreserveincludestheeffectiveportionoftheaccumu-latednetchangeinfairvalueofacash-flowhedgingandinter-est-rate hedging instrument attributable to hedging transactions thathavenotyetoccurred.

Notes


Note 23 Earnings per share

Earnings per share before dilution Earningspersharebeforedilutionarecalculatedbydividingprofitattributable to the Parent Company’s shareholders by the weightedaveragenumberofordinarysharesduringtheperiod.

2019 2020

ProfitattributabletoParentCompanyshareholders, SEK m 810 253Weightedaveragenumberofout-standing ordinary shares before dilution 168,769,856 168,852,821Earnings per share before dilution, SEK 4.80 1.50

Earnings per share after dilution To calculate earnings per share after dilution, the weighted aver-age number of outstanding ordinary shares is adjusted for the dilu-tiveeffectofallpotentialordinaryshares.Thesepotentialordinaryshares are attributable to the Performance Share Plans that were introducedin2019.ReferalsotoNotes4and21.Variouscircum-stancesmayentailthatthesharerightsdonotleadtoanydilution.Ifnetprofitfortheyearfromcontinuingoperationsisnegative,thesharerightsarenotconsidereddilutive.Sharerightsarealsonotdilutive if the value of remaining future services to report during the vesting period correspond to an exercise price that exceeds the averagesharepricefortheperiod.Furthermore,theperformanceshare rights do not lead to dilution if the achieved earnings per shareareinsufficienttoentitlesharesattheendofthevestingperiod.

2019 2020

Weightedaveragenumberofout-standing ordinary shares 168,769,856 168,852,821PerformanceSharePlan2019 274,442 440,161Weightedaveragenumberofout-standing ordinary shares after dilution 169,044,298 169,292,982Earnings per share after dilution, SEK 4.79 1.50

Note 24 Appropriation of company’s profit or loss

Proposed appropriation of company’s profit or loss ThefollowingprofitsintheParentCompanyareatthedispositionof the Annual General Meeting:

Share premium reserve 52,225,486Unappropriatedprofitbroughtforward 1,233,554,474Netprofitfortheyear -207,482,212Total SEK 1,078,297,748

TheBoardofDirectorsproposesthatallprofitsatthedispositionofthe Annual General Meeting be appropriated as follows:

StandarddividendofSEK2persharetobepaid to shareholders 337,705,642To be carried forward 740,592,106Total SEK 1,078,297,748

Note 25 Provisions for pensions

Defined-benefit pension plans, GroupGroup

Provisions for pensions, SEK m 2019 2020

Defined-benefitpensionplans 473 556

Thereareseveraldefined-benefitpensionplanswithintheGroup,whereby the employee’s right to remuneration after termination of employmentisbaseduponfinalsalaryandperiodofservice.TheseplansarefoundintheUK,SwedenandAustria.TheplanintheUKhasalreadybeenconcludedandnonewbenefitscanbeearned.Thesepensionplanshavebeenreplacedbydefined-contributionplans.

Commitments for old-age pensions and family pensions for sala-ried employees in Sweden are secured on the basis of the FPG/PRI systemandinsurance,primarilywithAlecta.Accordingtostate-ment UFR 3 from the Swedish Financial Reporting Board, the insur-ancewithAlectaisamulti-employerdefined-benefitplan.SincetheGroupdidnothaveaccesstoinformationinthe2019fiscalyearthatwouldmakeitpossibletorecognisethisplanasadefined-ben-efitplan,ITPpensionplanssecuredonthebasisofinsurancewithAlectahavebeenrecognisedasdefined-contributionplans.Feesfor pension insurance with Alecta for the year amounted to SEK 2.0m(3.3).On31December2020,Alecta’ssurplus,whichcanbedistributed between the policy holder and/or the persons insured in theformofthecollectiveconsolidationrate,amountedto148%(142%on31December2019).Thecollectiveconsolidationratecom-prises the market value of Alecta’s assets as a percentage of the insurance commitments produced in accordance with Alecta’s actuarial calculation assumptions, which are not in agreement with IAS19.

The amounts recognised in the consolidated balance sheet have been calculated as follows:


Present value of funded obligations 3,243 3,338Fair value of plan assets -3,019 -3,033

224 305Present value of unfunded obligations 249 251Net debt in provisions for pensions 473 556

Thenetdebtfordefined-benefitplansamountingtoSEK556m(473)is recognised in the “Provisions for pensions” item in the consoli-datedbalancesheet.Thenetdebtatyear-endwasasfollows:UK55%,Sweden35%andAustria10%.

Notes


Changes in the defined-benefit pension commitments during the year were as follows:Defined-benefit obligation Plan assets Net debt

SEK m 2019 2020 2019 2020 2019 2020

At beginning of the year 2,954 3,492 -2,449 -3,019 505 473RecognisedinprofitorlossCosts for service during current year 9 15 – – 9 15Pensionadjustmentfordefined-benefitplans in UK – 8 – – – 8Interestexpense(+)/income(–) 87 61 -66 -61 21 0

96 84 -66 -61 30 23

Recognised in other comprehensive incomeRemeasurements

Actuarial gains/losses due to– demographic assumptions -25 -5 – – -25 -5– financial assumptions 361 462 – – 361 462– experience-based adjustments -6 -1 – – -6 -1

Return on plan assets excluding interest income – – -336 -321 -336 -321

Exchange-ratedifferences 213 -327 -192 297 21 -30543 129 -528 -24 15 105

OtherEmployer contributions – – -69 -48 -69 -48Benefitspaid -101 -116 93 119 -8 3

-101 -116 24 71 -77 -45At year-end 3,492 3,589 -3,019 -3,033 473 556


Cost of goods sold 3 1Selling expenses 2 9Administrative expenses 4 3Netfinancialitems 21 10Total pension costs 30 23

The actual return on the plan assets of the pension plans amounted to:SEK m 2019 2020

Interest income 74 61Return on pension assets excluding interest income 336 321Total actual return on plan assets 410 382

Principal actuarial assumptions:Group

% 2019 2020

Discount rate:UK 2.10 1.40Austria 1.00 0.90Sweden 1.50 1.20

Future annual salary increases:UK – –Austria 2.30 2.30Sweden 2.30 2.00

Future annual pension increases:UK 2.60 2.80Austria – –Sweden 2.30 2.00

Life expectancyThe expected average number of years of life remaining after retire-mentat65yearsofageisasfollows:

Group% 2019 2020

On closing dateMen 20.7-22.9 20.7-23.0Women 23.5-25.4 23.4-25.5

20yearsafterclosingdateMen 22.0-26.3 22.0-25.8Women 24.0-28.5 24.0-28.1

Note25continued

Notes


Plan assets comprise the following:

2019 2020

GroupSEK m

Listed price on an active

marketUnlisted

price

Listed price on an active

marketUnlisted

price

Cash and cash equivalents 159 – 325 –High-quality corporate bonds 1,089 – 1,040 –Mutual funds, global 375 – 375 –Fixed-income funds, term7–20years 1,396 – 1,293 –Total 3,019 – 3,033 –

Contributions to post-employment remuneration plans are expectedtoamounttoSEK76m(74)forthe2020fiscalyear.

Sensitivity analysis:The table below presents the possible changes in actuarial assump-tions at year-end, all other assumptions being unchanged, and how theywouldaffectthedefined-benefitcommitments.

Group, SEK m Increase Decrease

Discountrate(1%change) -557 742Expectedmortality(1-yearchange) 192 -64Futuresalaryincrease(1%change) 77 43Future increase in pension (1%change) 344 -316

Total pension costs recognised in the consolidated income statement were as follows:

GroupPension costs, SEK m 2019 2020

Totalcostsfordefined-benefitplans 30 23Pensionadjustmentfordefined-benefitplans in UK – 8Totalcostsfordefined-contributionplans 235 161Costs for special employer’s contribu-tions and tax on returns from pension 10 11Total pension costs 275 203

Defined-benefit pension plans, Parent Company:Parent Company

Provisions for pensions, SEK m 2019 2020

Provisions in accordance with Pension Obligations Vesting Act, FPG/PRI pensions1 48 531)AccordingtoIAS19.

The costs are recognised in the Parent Company’s income statement as follows:

Parent CompanyDefined-benefit plans, SEK m 2019 2020

Administrative expenses 3 2

The total pension cost recognised in the Parent Company’s profit or loss is as follows:

Parent CompanyPension costs, SEK m 2019 2020

Totalcostsfordefined-benefitplans 4 3Totalcostsfordefined-contributionplans 14 16Costs for special employer’s contribu-tions and tax on returns from pension 3 4Total pension costs 21 23

Parent Company pension liabilities are calculated at a discount rateof1.2%(1.5).

The assumptions are calculated on the basis of the salary levels applicableontheclosingdate.SEK380,000(376,000),pertainingtodefined-benefitpensionplansintheParentCompany,isexpectedtobepaidin2021.

Note25continued

Notes


Note 26 Deferred tax

The change in deferred tax assets/tax liabilities for the year, Group2019 2020

SEK mDeferred tax

assetsDeferred tax

liabilities NetDeferred tax

assetsDeferred tax

liabilities Net

Opening balance 97 75 22 72 49 23Recognisedinprofitorloss -11 -5 -6 23 -14 37Remeasurementsofdefined-benefit pension plans 0 – 0 30 – 30Changes in forward agreements 4 0 4 -2 – -2Recognised directly against shareholders’ equity – – – -4 – -4Offset/Reclassification -22 -22 0 – – –Translationdifferences 4 1 3 – – –Closing balance 72 49 23 119 35 84

The change in deferred tax assets/tax liabilities for the year

Deferred tax assetsDefined-benefit

pension plansOther temporary

differencesLoss carryforwards,

Leasing, etc. Total

As per 1 January 2019 69 28 0 97Recognisedinprofitorloss 1 -20 8 -11Recognised in other comprehensive income 0 4 – 4Offset – -22 – -22Translationdifferences 4 0 – 4As per 31 December 2019 74 -10 8 72

As per 1 January 2020 74 -10 8 72Recognisedinprofitorloss 0 25 -2 23Recognised in other comprehensive income 30 -2 – 28Recognised directly against shareholders’ equity -21 17 – -4As per 31 December 2020 83 30 6 119

Deferred tax liabilitiesTemporary differences

in fixed assets Other Total

As per 1 January 2019 49 26 75Recognisedinprofitorloss -1 -4 -5Recognised in other comprehensive income – 0 0Offset – -22 -22Translationdifferences 1 0 1As per 31 December 2019 49 0 49

As per 1 January 2020 49 0 49Recognisedinprofitorloss -12 – -12Recognised in other comprehensive income – -1 -1Offset – – 0Translationdifferences -1 – -1As per 31 December 2020 36 -1 35

On 1 January 2021, the corporation tax rate in Sweden was lowered from21.4%to20.6%.Nobia’sdeferredtaxespertainingtoSwedenare recognised at the new tax rates as per 31 December 2020, with amarginaleffectintheincomestatementandthebalancesheet.

Deferred tax assets on loss carryforwards at year-end amounted toSEK0m(3)andwereattributabletoSweden.

Nobia does not recognise any deferred tax attributable to tempo-rarydifferencesrelatingtoinvestmentsinsubsidiariesorassoci-

atedcompanies.Anyfutureeffects(withholdingtaxandotherdeferredtaxforprofittakingwithintheGroup)arerecognisedwhenNobiaisnolongerabletogovernthereversalofsuchdiffer-ences or when, for other reasons, it is no longer improbable that reversalswillbemadeintheforeseeablefuture.Thesepossiblefutureeffectsarenotdeemedtohaveanyrelationtotheoverallamountofthetemporarydifferences.

Notes


Note 27 Other provisions

SEK mUnutilised

tenancy rights Dilapidations

Other long-term employee

benefitsRestructuring

costs Other Total

As per 1 January 2020 16 12 8 – 3 39Expensed in consolidated income statement–Additionalprovisions – – 0 20 1 21–Reversedunutilisedamounts – – – – -2 -2Utilised during the year -5 -2 -2 – – -9Translationdifferences -1 -1 0 – -1 -3As per 31 December 2020 10 9 6 20 1 46

Note 28 Liabilities to credit institutions

Group Parent CompanyMaturity structure, SEK m 2019 2020 2019 2020

Within1year – – – –Between1and5years 1,130 285 – –Longerthan5years – – – –Total 1,130 285 – –

Note 29 Accrued expenses and deferred income


Bonus to customers 153 165 – –Accrued salary-related costs 210 227 10 21Accrued interest 0 0 – 0Insurance policies 25 25 – –Rents 18 36 – –Other 209 326 8 30Total 615 779 18 51

Note 30 Financial assets and liabilities

Measured at fair value

through other comprehensive

incomeMeasured at fair value through profit or loss Amortised cost

Group 2020, SEK m Note

Derivatives used in hedge

accounting

Non-hedge-accounting

derivative instruments

Financial instruments

initially identified at fair value

Interim items

Accounts and

loans receivable

Other liabilities

Total carrying amount1

Financial assetsLong-terminterest-bearingreceivables 16 – – – – 0 – 0Other long-term receivables 16 – – – – 96 – 96Accounts receivable 2 – – – – 1,213 – 1,213Current interest-bearing receivables – – – – 2 – 2Other receivables 2,18,19 0 1 – 217 60 – 278Total 0 1 – 217 1,371 – 1,589

Financial liabilitiesLong-terminterest-bearingliabilities 28 – – – – – 285 285Current interest-bearing liabilities 2 – – – – – 0 0Leaseliabilities – – – – – 2,183 2,183Accounts payable 2 – – – – – 1,317 1,317Other liabilities 2,18,29 21 5 – 743 – 628 1,397Total 21 5 0 743 – 4,413 5,1821)Thecarryingamountisconsideredtoessentiallycorrespondtothefairvalue.

Notes





Group 2019, SEK m Note


accounting





Interim items

Accounts and

loans receivable

Other liabilities


Financial assetsLong-terminterest-bearingreceivables 16 – – – – 2 – 2Other long-term receivables 16 – – – – 103 – 103Accounts receivable 2 – – – – 1,371 – 1,371Current interest-bearing receivables – – – – 4 – 4Other receivables 2,18,19 2 3 – 183 60 – 248Total 2 3 – 183 1,540 – 1,728

Financial liabilitiesLong-terminterest-bearingliabilities 28 – – – – – 1,134 1,134Current interest-bearing liabilities 2 – – – – – 0 0Leaseliabilities 2 – – – – – 2,475 2,475 Accounts payable 2 – – – – – 1,162 1,162Additional purchase consideration 2 – – 44 – – – 44Other liabilities 2,18,29 23 1 – 597 – 349 970Total 23 1 44 597 – 5,120 5,7851)Thecarryingamountisconsideredtoessentiallycorrespondtothefairvalue.

Exchange-rate gains and losses pertaining to the operations were recognised in other operating income and operating expenses in the net amountofSEK26m(8).Financialexchange-rategainsandlosseswererecognisedinnetfinancialitemsintheamountofSEK5m(0).




Parent Company 2020, SEK m Note


accounting





Interim items

Accounts and

loans receivable

Other liabilities


Financial assetsOther long-term receivables – – – – 5 – 5Accounts receivable – – – – 0 – 0Other receivables 18,19 – 23 – 36 2,839 – 2,898Total – 23 – 36 2,844 – 2,903

Financial liabilitiesLong-terminterest-bearingliabilities – – – – – 39 39Long-termnon-interest-bearing liabilities – – – – – 5 5Current interest-bearing liabilities – – – – – 1,815 1,815Accounts payable – – – – – 31 31Other liabilities 18,29 – 26 – 51 – 10 87Total – 26 – 51 – 1,900 1,9771)Thecarryingamountisconsideredtoessentiallycorrespondtothefairvalue.

Note 30 continued

Notes





Parent Company 2019, SEK m Note


accounting





Interim items

Accounts and

loans receivable

Other liabilities


Financial assetsOther long-term receivables – – – – 6 – 6Accounts receivable – – – – 1 – 1Other receivables 18,19 – 29 – 35 2,253 – 2,317Total – 29 – 35 2,260 – 2,324

Financial liabilitiesLong-terminterest-bearingliabilities – – – – – 43 43Long-termnon-interest-bearing liabilities – – – – – 5 5Current interest-bearing liabilities – – – – – 790 790Accounts payable – – – – – 44 44Other liabilities 18,29 – 26 – 18 – 3 47Total – 26 – 18 – 885 9291)Thecarryingamountisconsideredtoessentiallycorrespondtothefairvalue.

Determination of fair value of financial instrumentsLevel1 accordingtopriceslistedinanactivemarketforthesame

instrument.Level2baseddirectlyorindirectlyonobservablemarketinforma-

tionnotincludedinLevel1.Level3basedoninputthatisnotobservableinthemarket.

ThemeasurementofderivativeinstrumentsisincludedinLevel2andbasedonmarketlistingsorthecounterparty’smeasurement.DerivativeinstrumentsamountedtoSEK1m(5)inassetsandSEK26m(24)inliabilities.Inanestimateoffairvalue,thecompany’slong-termloansarenotdeemedtosignificantlydeviatefromtheircarryingamounts.

Note 31 Pledged assets, contingent liabilities and commitments

The Group has contingent liabilities pertaining to sub-contractor guarantees, pension liabilities, bank guarantees for loans and other guarantees and other considerations that arise in normal commercialoperations.Nosignificantliabilitiesareexpectedtoarisethroughthesecontingentliabilities.Basedonthecompany’sassessment,noprovisionhasbeenpostedforongoingtaxcases.The amounts involved are not considered to have any material effectonthecompany’sresultsorfinancialposition.

In their normal business activities, the Group and the Parent Com-panypledgedthefollowingguaranteesandcontingentliabilities.


Securities for pension commitments 2 2 24 25Other contingent liabilities 276 296 1,304 396Total 228 298 1,328 421

Note 30 continued

Note 32 Related-party transactionsAspecificationofsubsidiariesispresentedinNote17. Remuneration was paid to senior executives during the year, refer

toNote4.

Summary of related-party transactions

Parent Company Year

Sale of goods/services from

related parties

Purchase of goods/services

from related parties

Invoicing Group-wide services

Other (such as interest, dividends)

Receivables from related parties

per 31 Dec

Liabilities to related parties

per 31 Dec

Related partiesSubsidiaries 2020 62 136 275 163 2,834 1,815Subsidiaries 2019 – 45 281 463 2,212 790

Notes


Note 33 Specifications for statement of cash flows

Cash and cash equivalentsGroup Parent Company

SEK m 2019 2020 2019 2020

Cash and bank balances 76 90 1 2Balance of Group account with the Parent Company 181 545 157 434Total according to balance sheet and total according to statement of cash flows 257 635 158 436

Short-terminvestmentshavebeenclassifiedascashandcashequivalents based on the following:• Theyhaveaninsignificantriskofchangesinvalue.• Theycanbeeasilyconvertedtocashfunds.• They have a term of a maximum of three months from the acquisi-tiondate.

Interest paid and dividends receivedGroup Parent Company

SEK m 2019 2020 2019 2020

Dividends received – – 500 –Interest received 1 2 80 11Interest paid -70 -74 -10 -202

-69 -72 570 -191

Reconciliation of liabilities deriving from financing activitiesCB 2019 Cash flows Changes that do not impact cash flow CB 2020

Group, SEK mAcquisition of

operationsDivestment of

operationsChanges in

leasesExchange-rate

differences

Interest-bearing liabilities 1,134 -849 – – – – 285Leaseliabilities 2,475 -449 – – 304 -147 2,183Total liabilities deriving from financing activities 3,609 -1,298 – – 304 -147 2,468

Reconciliation of liabilities deriving from financing activitiesCB 2019 Cash flows Changes that do not impact cash flow CB 2020

Parent Company, SEK mAcquisition of

operationsDivestment of

operationsChanges in

leasesExchange-rate

differences

Leaseliabilities 28 – – – -3 – 25Total liabilities deriving from financing activities 28 – – – -3 – 25

Note 34 Events after the closing dateToreflecttheambitionsinNobia’sstrategy,theNobiaboardofdirectorsadoptedrevisedlong-termfinancialtargetsfortheGroupin March 2021:

Growth: Averageorganicgrowthistargetedtobe3–5%peryear.(previoustarget:organicandacquiredgrowthofmorethan5%peryearonaverage).

Profitability: The operating margin is targeted to be greater than 10%overabusinesscycle.(targetunchanged).

Capital structure: Leverage,definedasnetdebt(excl.IFRS16 Leasing)/EBITDA,shallbebelow2.5times(previoustarget:netdebt/equityratiobelow100%).

Dividend policy: Dividends to shareholders shall comprise at least 40%ofnetprofitaftertax(previoustarget:dividendofbetween40–60%ofnetprofitaftertax).

Notes


Reconciliation of alternative performance measures

NobiapresentscertainfinancialperformancemeasuresintheAnnualReportthatarenotdefinedaccordingtoIFRS,knownasalternativeperformancemeasures.Nobiabelievesthatthesemea-sures provide valuable complementary information to investors and the company’s management since they facilitate assessments of trendsandthecompany’sperformance.Becausenotallcompaniescalculate performance measures in the same way, these are not always comparable with those measures used by other companies Consequently, the performance measures are not to be seen as replacementsformeasuresdefinedaccordingtoIFRS.Fordefini-tionsoftheperformancemeasuresthatNobiauses,seepage117.

Analysis of net sales Nordic region, Jan-Dec% SEK m

2019 6,753Organic growth 3 208Currencyeffect -2 -1602020 1 6,801

Analysis of net sales UK region, Jan-Dec% SEK m

2019 5,902Organic growth -19 -1,148Currencyeffect -2 -1052020 -21 4,649

Analysis of net sales Central Europe region, Jan-Dec% SEK m

2019 1,275Organic growth 2 29Currencyeffect -1 -132020 1 1,291

Operating profit before depreciation/amortisation and impairment, Jan-Dec

2016 2017 2018 2019 2020

Operatingprofit 1,298 1,286 1,018 1,132 437Depreciation/amortisa-tion and impairment 287 287 326 835 989Operating profit before depreciation/amortisa-tion and impairment (EBITDA) 1,585 1,573 1,344 1,967 1,426Net sales 12,648 12,744 13,209 13,930 12,741% of net sales 12.5% 12.3% 10.2% 14.1% 11.2%

Operating profit excluding items affecting comparability, Jan-Dec

2016 2017 2018 2019 2020

Operatingprofit 1,298 1,286 1,018 1,132 437Itemsaffecting comparability – – 661 – 1442

Operating profit exclud-ing items affecting com-parability 1,298 1,286 1,084 1,132 581

Profit after tax excluding items affecting comparability, Jan-Dec

2018 2019 2020

Profitaftertax 753 810 253Itemsaffectingcomparabilitynetaftertax 551 – 1292 Profit after tax excluding items affecting comparability 808 810 3821) Recognised on the line “Other operating expenses” and pertained to pension adjustmentsintheUK.

2) Attributable to the closure of the Tidaholm plant, which will be replaced by a new plantin2024,aswellasapensionadjustmentintheUK.

Net debt, 31 DecSEK m 2019 2020

Provisions for pensions (IB) 473 556Other long-term liabilities, interest-bearing (IB) 3,247 2,063Current liabilities, interest-bearing (IB) 362 405Interest-bearing liabilities 4,082 3,024Long-termreceivables,interest-bearing(IB) -2 0Current receivables, interest-bearing (IB) -4 -2Cash and cash equivalents (IB) -257 -635Interest-bearing assets -263 -637Net debt 3,819 2,387

Net debt excl. IFRS 16 Leases, SEK mSEK m 2019 2020

Net debt 3,819 2,387Ofwhich,IFRS16Leases 2,475 2,183Of which, provisions for pensions 473 556Net debt excl. IFRS 16 Leases 1,344 204Net debt excl. IFRS 16 Leases and provisions for pensions 871 -352

Operating capital, 31 DecSEK m 2019 2020

Total assets 10,846 10,085Other provisions -37 -45Deferred tax liabilities -49 -35Other long-term liabilities, non-interest-bearing -33 –Current liabilities, non-interest-bearing -2,368 -2,947Non-interest-bearing liabilities -2,487 -3,027Capital employed 8,359 7,058Interest-bearing assets -263 -637Operating capital 8,096 6,421

Average operating capital, Jan-DecSEK m 2019 2020

OB Operating capital 5,163 8,096CB Operating capital 8,096 6,421Average operating capital before adjust-ments of acquisitions and divestments 6,630 7,259AdjustmentforeffectofintroductionofIFRS16that did not occur in the middle of the period 1,358 0Average operating capital 7,988 7,259

Average shareholders’ equity, Jan-DecSEK m 2019 2020

OB Equity attributable to Parent Company shareholders 3,897 4,277CB Equity attributable to Parent Company shareholders 4,277 4,034Average equity before adjustment of increases and decreases in capital 4,087 4,156Adjustment for acquisitions and divestments not occurred in the middle of the period -112 –Average shareholders’ equity 3,975 4,156

Notes


Board of Directors’ assurance

The Board of Directors and the President declare that the Annual Report was prepared in accordance with generally accepted accountingprinciplesinSwedenandthattheconsolidatedfinan-cial statements have been prepared in accordance with the inter-national accounting standards referred to in Regulation (EC) No 1606/2002oftheEuropeanParliamentandoftheCouncilof19July2002ontheapplicationofinternationalaccountingstandards.TheAnnualReportandtheconsolidatedfinancialstatementsgiveatrue and fair view of the position and earnings of the Parent Com-

panyandtheGroup.TheBoardofDirectors’ReportfortheParentCompany and the Group gives a true and fair view of the develop-mentsofoperations,positionandearningsanddescribessignifi-cant risks and uncertainties facing the Parent Company and com-paniesincludedintheGroup.Theconsolidatedaccountsandbalance sheet and the Parent Company income statement and bal-ance sheet will be presented to the Annual General Meeting for adoptionon29May2021.

Stockholm,6April2021

NoraFørisdalLarssen Chairman

George Adams Marlene Forsell Jan Svensson Board member Board member Board member

Arja Taaveniku Carsten Rasmussen Jon Sintorn Board member Board member President & CEO

Per Bergström Mats Karlsson Employee representative Employee representative

Ourauditreportwassubmittedon6April2021

Deloitte AB

Daniel de Paula Authorised Public Accountant


Board of Directors’ assurance

Auditor’s report

To the general meeting of the shareholders of Nobia AB (publ) cor-porateidentitynumber556528-2752

Report on the annual accounts and consolidated accounts OpinionsWehaveauditedtheannualaccountsandconsolidatedaccountsofNobiaAB(publ)forthefinancialyear2020-01-01–2020-12-31.Theannual accounts and consolidated accounts of the company are includedonpages43-99inthisdocument.

In our opinion, the annual accounts have been prepared in accor-dance with the Annual Accounts Act and present fairly, in all mate-rialrespects,thefinancialpositionoftheparentcompanyasof31December2020anditsfinancialperformanceandcashflowfortheyearthenendedinaccordancewiththeAnnualAccountsAct.The consolidated accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, thefinancialpositionofthegroupasof31December2020andtheirfinancialperformanceandcashflowfortheyearthenendedinaccordance with International Financial Reporting Standards (IFRS),asadoptedbytheEU,andtheAnnualAccountsAct.Thestat-utory administration report is consistent with the other parts of the annualaccountsandconsolidatedaccounts.Wethereforerecommendthatthegeneralmeetingofsharehold-

ers adopts the income statement and balance sheet for the parent companyandthegroup.

Our opinions in this report on the the annual accounts and con-solidated accounts are consistent with the content of the additional report that has been submitted to the parent company's audit com-mitteeinaccordancewiththeAuditRegulation(537/2014)Article11.

Basis for Opinions WeconductedourauditinaccordancewithInternationalStan-dards on Auditing (ISA) and generally accepted auditing standards inSweden.OurresponsibilitiesunderthosestandardsarefurtherdescribedintheAuditor’sResponsibilitiessection.Weareindepen-dent of the parent company and the group in accordance with pro-fessional ethics for accountants in Sweden and have otherwise ful-filledourethicalresponsibilitiesinaccordancewiththeserequirements.Thisincludesthat,basedonthebestofourknowl-edge and belief, no prohibited services referred to in the Audit Reg-ulation(537/2014)Article5.1havebeenprovidedtotheauditedcompany or, where applicable, its parent company or its controlled companieswithintheEU.Webelievethattheauditevidencewehaveobtainedissufficient

andappropriatetoprovideabasisforouropinions.

Key Audit Matters Key audit matters of the audit are those matters that, in our profes-sionaljudgment,wereofmostsignificanceinourauditoftheannualaccountsandconsolidatedaccountsofthecurrentperiod.These matters were addressed in the context of our audit of, and in forming our opinion thereon, the annual accounts and consoli-dated accounts as a whole, but we do not provide a separate opin-iononthesematters.

Revenue Recognition The group reported revenue of SEK 12,741 million as of 31 December 2020 which mainly consists of sales related to kitchens and kitchen equipment,andforsomesalesalsoinstallationservices.Withinthegroup, revenue related to kitchens and pertaining products is rec-ognized at a point of time upon delivery of the goods to the cus-tomer, which is the point in time when the customer accepts the delivery, and receives control over the products and the group have fulfilledtheirperformanceobligations.Revenuerelatedtoinstalla-tionsisrecognizedovertimewhentheinstallationisperformed.Wehaveidentifiedthisasakeyauditmattersincerevenuehasasignif-icantimpactonthefinancialreportingandconsistsofalargeamount of transactions as well as are dependent on customer spe-

cificagreements,deliverytermsandinstallationwhichcouldaffectthecompletenessandtimingofrecognizedrevenue.Forthegroupsprinciples on revenue recognition, refer to note 1 and note 3 regard-ingaccountingofoperatingsegments.

Our Audit Procedures Our audit procedures included but where not limited to: • evaluation of the Group’s accounting principles regarding

revenue • gained an understanding of the Group’s routines and evaluating

internal controls regarding revenue recognition including IT-systems used

• review of a selection of transactions to ensure accurate revenue recognition in accordance with agreements and in the correct period

• review of marginal analysis’ as well as analysis of revenue against previous years and budget

• review of the adoption of appropriate accounting principles and that the required disclosures are included in the annual report and consolidated accounts

Impairment Tests of Goodwill Asof31December2020,thegroupreportedgoodwillofSEK2,830mil-lion.Onayearlybasis,andwhenthereisanindicationofimpairment,Nobia tests that the carrying value of assets does not exceed the calcu-latedrecoverableamountsfortheseassets.Therecoverableamountsaredeterminedusingpresentvaluecomputationoffuturecashflowsper cash generating unit based on the expected outcome of a number ofassumptionsbasedonmanagement’sbusinessplanandforecasts.WehaveidentifiedthisasakeyauditmatterastheGroup’sgood-

will is a material item in the balance sheet and the impairment test have considerable elements of management judgements which amongotherscompriseofestimatingfuturecashflowsandcalcu-lateweightedaveragecapitalcost(“WACC”).

For the group’s principles on impairment tests of intangible and tangiblefixedassetsrefertonote1andformaterialassumptionsusedinthisyear’simpairmenttestsrefertonote13.

Our Audit Procedures Our audit procedures included but where not limited to: • evaluation of the Group’s accounting principles for the prepara-

tion of impairment tests in accordance with IFRS • evaluation of material assumptions as well as the sensitivity to

change in these assumptions including assessment how the cur-rentpandemicmightaffectcash-flows.

• reviewofassumptionsusedinWACCcaluculations.• reviewofthediscountedfuturecashflowmodelforarithmetic

accuracy • examination of the completeness of the disclosures for impair-menttestsintheannualreportandgroupconsolidation.

Write-downs and disassembly reserveIn December 2020, the Group concluded the preparatory phase for the new facility in Jönköping and it was decided that the current facil-ityinTidaholmwillbetakenoutofuseattheendof2023.Asaresultofthis, the Group wrote down assets attributable to the Tidholm facility and provisioned for disassembly costs totaling SEK 144 million, which affectedtheresultfor2020.Wehaveidentifiedthisaskeyauditmatterasthereportingof

write-downs of assets and provisions for disassembly contains sig-nificantassessmentssuchasassessingtheresidualvaluewhenmachines and facilities are taken out of use and an estimation of thecostsfordisassembly.

For the Group's principles for impairment, see note 1 Accounting principlesandnote14Tangiblefixedassets.


Audit report

Our Audit ProceduresOur audit procedures included but were not limited to:• evaluation of the Group's accounting principles for write-downs

and provisions• evaluation of the Group's assessments of residual value when

machines and facilities are taken out of use and the estimation of costs for disassembly

• review that appropriate and required information is disclosed in theannualreport.

Other information than the annual accounts and consolidated accountsThis document also contains other information than the annual accountsandconsolidatedaccountsandisfoundonpages1–42and110–122.TheBoardofDirectorsandtheManagingDirectorareresponsibleforthisotherinformation.

Our opinion on the annual accounts and consolidated accounts does not cover this other information and we do not express any formofassuranceconclusionregardingthisotherinformation.

In connection with our audit of the annual accounts and consoli-dated accounts, our responsibility is to read the information identi-fiedaboveandconsiderwhethertheinformationismateriallyinconsistentwiththeannualaccountsandconsolidatedaccounts.In this procedure we also take into account our knowledge other-wise obtained in the audit and assess whether the information oth-erwiseappearstobemateriallymisstated.

If we, based on the work performed concerning this information, conclude that there is a material misstatement of this other infor-mation,wearerequiredtoreportthatfact.Wehavenothingtoreportinthisregard.

Responsibilities of the Board of Directors and the Managing Director The Board of Directors and the Managing Director are responsible for the preparation of the annual accounts and consolidated accounts and that they give a fair presentation in accordance with the Annual Accounts Act and, concerning the consolidated accounts,inaccordancewithIFRSasadoptedbytheEU.TheBoardof Directors and the Managing Director are also responsible for such internal control as they determine is necessary to enable the preparation of annual accounts and consolidated accounts that arefreefrommaterialmisstatement,whetherduetofraudorerror.

In preparing the annual accounts and consolidated accounts, The Board of Directors and the Managing Director are responsible for the assessment of the company’s and the group’s ability to con-tinueasagoingconcern.Theydisclose,asapplicable,mattersrelated to going concern and using the going concern basis of accounting.Thegoingconcernbasisofaccountingishowevernotapplied if the Board of Directors and the Managing Director intends to liquidate the company, to cease operations, or has no realistic alternativebuttodoso.

Auditor’s responsibility Our objectives are to obtain reasonable assurance about whether the annual accounts and consolidated accounts as a whole are free from material misstatement, whether due to fraud or error, and toissueanauditor’sreportthatincludesouropinions.Reasonableassurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and generally accepted auditing standards in Sweden will always detect a mate-rialmisstatementwhenitexists.Misstatementscanarisefromfraud or error and are considered material if, individually or in the aggregate,theycouldreasonablybeexpectedtoinfluencetheeconomic decisions of users taken on the basis of these annual accountsandconsolidatedaccounts.

An additional description of our responsibility for the audit of the annual accounts and the consolidated accounts is on the Swedish InspectorateofAuditorswebpage:www.revisorsinspektionen.se/revisornsansvar.Thisdescriptionisapartoftheauditor’sreport.

Report on other requirements according to laws and regulationsOpinions In addition to our audit of the annual accounts and consolidated accounts, we have also audited the administration of the Board of Directors and the Managing Director of Nobia AB (publ) for the

financialyear2020-01-01–2020-12-31andtheproposedappropria-tionsofthecompany’sprofitorloss.Werecommendtothegeneralmeetingofshareholdersthatthe

profittobeappropriatedinaccordancewiththeproposalinthestatutory administration report and that the members of the Board of Directors and the Managing Director be discharged from liability forthefinancialyear.

Basis for Opinions WeconductedtheauditinaccordancewithgenerallyacceptedauditingstandardsinSweden.Ourresponsibilitiesunderthosestandards are further described in the Auditor’s Responsibilities section.Weareindependentoftheparentcompanyandthegroupin accordance with professional ethics for accountants in Sweden andhaveotherwisefulfilledourethicalresponsibilitiesinaccor-dancewiththeserequirements.Webelievethattheauditevidencewehaveobtainedissufficient

andappropriatetoprovideabasisforouropinions.

Responsibilities of the Board of Directors and the Managing Director The Board of Directors is responsible for the proposal for appropri-ationsofthecompany’sprofitorloss.Attheproposalofadividend,thisincludesanassessmentofwhetherthedividendisjustifiableconsidering the requirements which the company's and the group’s type of operations, size and risks place on the size of the parent company's and the group’s equity, consolidation requirements, liquidityandpositioningeneral.

The Board of Directors is responsible for the company’s organiza-tionandtheadministrationofthecompany’saffairs.Thisincludesamong other things continuous assessment of the company’s and thegroup’sfinancialsituationandensuringthatthecompany'sorganization is designed so that the accounting, management of assetsandthecompany’sfinancialaffairsotherwisearecontrolledinareassuringmanner.TheManagingDirectorshallmanagetheongoing administration according to the Board of Directors’ guide-lines and instructions and among other matters take measures that arenecessarytofulfillthecompany’saccountinginaccordancewith law and handle the management of assets in a reassuring manner.

Auditor’s responsibility Our objective concerning the audit of the administration, and thereby our opinion about discharge from liability is to obtain audit evidence to assess with a reasonable degree of assurance whether any member of the Board of Directors or the Managing Director in any material respect: • has undertaken any action or been guilty of any omission which

can give rise to liability to the company, or • in any other way has acted in contravention of the Companies Act,theAnnualAccountsActortheArticlesofAssociation.

Our objective concerning the audit of the proposed appropriations ofthecompany’sprofitorloss,andtherebyouropinionaboutthis,is to assess with reasonable degree of assurance whether the pro-posalisinaccordancewiththeCompaniesAct.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with generally accepted auditing standards in Sweden will always detect actions or omissions that can give rise to liability to the company, or that theproposedappropriationsofthecompany’sprofitorlossarenotinaccordancewiththeCompaniesAct.

An additional description of our responsibility for the audit of the annual accounts and the consolidated accounts is on the Swedish InspectorateofAuditorswebpage:www.revisorsinspektionen.se/revisornsansvar.Thisdescriptionisapartoftheauditor’sreport.

Deloitte AB, was appointed auditors of Nobia AB by the general meetingoftheshareholdersonthe2020-05-05andhasbeenthecompany’sauditorsince2017-04-06.

Stockholm6april2021Deloitte AB

Daniel de PaulaAuthorized Public Accountant


Audit report

Corporate Governance

Nobia AB is a Swedish public limited liability company domiciled in Stockholm, Sweden. The company is the Parent Company of the Nobia Group. The basis for the control of the Group includes the Swedish Corporate Governance Code, the Articles of Association, the Swedish Companies Act, the Swedish Annual Accounts Act and Nasdaq Stockholm’s Rule Book for Issuers.

Nobia has applied the Swedish Corporate Governance Code (the Code)sinceJuly2005andthecompanyhadnodeviationstoreportfor2020.NobiaalsoappliestheSwedishAnnualAccountsActconcerningthecompany’scorporategovernancereporting.

Nobia monitors developments in the area of corporate gover-nance and continuously adapts its corporate-governance princi-plestocreatevalueforitsownersandotherstakeholders.Bywayof information, it is noted that there were no breaches of applicable stock-exchange rules or good practice on the stock market based on decisions by Nasdaq Stockholm’s Disciplinary Committee or statementsbytheSwedishSecuritiesCouncil.Thefollowinginformationisavailableatwww.nobia.com.

• Nobia’s Articles of Association• Code of Conduct • Allcorporategovernancereportssince2009• Information from Nobia’s AGM

Board commitment The Board is committed to maintaining the highest standards of cor-porategovernanceinthemanagementofitsaffairsandensuringitsactivitiesreflecttheculturewewishtonurturewithourcolleaguesandotherstakeholders.

The Board places great importance on ensuring a sustainable long-term success for the businesses and markets in which Nobia operate,whilebeingalignedwithourculture.TheBoardhasover-all responsibility for establishing the Company’s purpose, values and strategy to deliver the long-term sustainable success of the Company andgeneratevalueforshareholders.

Throughout the year, the Board has proactively focused on ensuring thatboththeshortandlongtermimplicationsofCovid-19pandemiconourbusinessismanagedconsequently,significanttimehasbeenspentateachBoardmeetingtoadressspecificCoronavirusrisks.Duringthepandemic,theBoardhascontinuouslymonitoredthedevelopment of the infection situation, the restrictions imposed by various governments and the business impacts of the pandemic, and the company has implemented measures to secure business continuity.Thesafetyofouremployees,partnersandlocalcommu-nitiesisofprimaryimportancetotheBoard.TheBoardandSeniorManagement closely monitors the development of the coronavirus pandemic and is updating its policies and instructions on the basis oftheguidelinesissuedbytheauthorities.

ShareholdersOnDecember31,2020,Nobiahad169852821outstandingsharesaccordingtotheshareregister.Thelargestshareholder,onthatdatewasNordstjernanAB,with24.9percentoftheshares/votesbasedonthenumberofsharesoutstanding.Asperthesamedate,IFSkadeförsäkringAB(publ)held10.7percentoftheshares/votesbased on the numer of shares outstanding

2020 annual general meetingTherightofshareholderstomakedecisionsconcerningtheaffairsofNobiaisexercisedatgeneralmeetingsofshareholders.Anoticeconvening a general meeting is issued pursuant to the Swedish CompaniesActandthecompany’sArticlesofAssociation.The2020AnnualGeneralMeeting(AGM)washeldon5Mayat

WorldTradeCenter,AuditoriumNewYork,Klarabergsviadukten70,Stockholm.Atthemeeting,tenshareholderswereinattendance,per-sonallyorbyproxy,representingabout69percentofvotesinNobia.

The Board Chairman, Hans Eckerström and Board member Nora FørisdalLarssenwerepresentattheMeeting.BoardChairman,HansEckerström,waselectedChairmanoftheMeeting.

Some of the AGM resolutions were as follows: • nodividendwastobepaidtotheshareholdersforthefinancialyear2019inaccordancewiththeBoard’sproposal.

• that the number of Board members was to be six with no deputy members,untiltheconclusionofthenextAGM.

• fees to the Board, Board Chairman, and the Chairman and mem-bersoftheAuditCommittee.

• re-electedNoraFørisdalLarssen,MarleneForsellandGeorgeAdams.

• Jan Svensson, Arja Taaveniku and Carsten Rasmussen was electedasnewBoardmembers.

• NoraFørisdalLarssenwaselectedasChairmanoftheBoard.• HansEckerström,StefanJacobssonandJillLittledeclinedre-election.

• re-election of Deloitte AB as auditor, with Daniel de Paula as Auditor-in-Charge.

• principles and guidelines on remuneration and other employment conditionsforthePresidentandotherseniorexecutives.

• authorisation for the Board to acquire and sell treasury shares duringtheperioduntilthe2021AGM.

The complete minutes from the AGM and information are available onNobia’swebsitewww.nobia.com.Individualshareholderswishingtohaveaspecificmatter

addressed by the AGM can do so by submitting a request to Nobia’s Board in good time prior to the Meeting, to the address publishedontheGroup’swebsite.

1 Shareholders through general meetingsNobia is a Swedish public limited liability company that is subject to the Swedish Companies Act, Nasdaq Stockholm’s Rule Book for Issuers, the Swedish Corporate Governance Code and the compa-ny’sArticlesofAssociation.Shareholdersexercisetheirinfluenceatthe general meeting of shareholders, which is Nobia’s highest deci-sion-makingbody.Nobiahasoneclassofsharewithonesharecor-respondingtoonevoteatgeneralmeetings.Additionalinforma-tion about the Nobia share and ownership structure can be found on pages114-115.TheAGMresolvesontheArticlesofAssociationandatthe AGM, which is the annual scheduled general meeting, the share-holders elect Board members, the Board Chairman and auditors, and decideontheirfees.Furthermore,theAGMresolvesontheadoptionof the income statement and the balance sheet, appropriation of the company’sprofitanddischargefromliabilityfortheBoardmembersandPresidentinrelationtothecompany.TheAGMalsoresolvesonthe composition and work of the Nomination Committee, and resolves on principles for remuneration and other employment conditions for thePresidentandotherseniorexecutives.

2 Nomination committeeAccording to the instruction for Nobia’s Nomination Committee adopted at the 2020 AGM, the members and Chairman of the Com-mittee are to be elected at the AGM for the period until the conclusion ofthefollowingAGM.

The Nomination Committee shall comprise at least three but not more than four members representing the largest shareholders of the com-pany.TheChairmanoftheNominationCommitteeshallconvenethefirstmeetingoftheNominationCommittee.TheNominationCommit-teeisentitledtoappointanadditionaltwoco-optedmembers.Co-optedmembers shall assist the Nomination Committee in performing its duties buthavenovotingrights.TheChairmanoftheBoardmaybeamemberoftheNominationCommitteeonlyasaco-optedmember.

In accordance with the Code, the Nomination Committee should be chairedbyanownerrepresentative.TheinstructionfortheNominationCommittee adopted by the AGM also states that the Nomination Com-



Finance, IT

Customer Experience & Marketing

People & Culture Support functions Business units

Nordic region Central Europe region UK region Group Product Supply Chain Operation

President and CEO

Key external regulatory frameworks:• Swedish Companies Act• Annual Accounts Act and IFRS• Nasdaq Stockholm’s Rule Book for Issuers• Market Abuse Regulation (MAR)• Swedish Corporate Governance Code• Modern Slavery Act

Examples of voluntary commitments:• UN Sustainable Development Goals• UN Global Compact initiative• Science Based Target initiative• Sustainability reporting according to the Global Reporting Initiative

Examples of key internal regulatory frameworks:• Articles of Association• The Board’s rules of procedure and instructions

to the President• Audit Committee’s rules of procedure• Nobia’s Financial & Accounting Manual• Risk Management Process• Sustainability strategy• Code of Conduct• Supplier Code of Conduct• Environmental and climate policy• Policy for sustainable forestry• Modern Slavery Statement

Auditors

Audit Committee

Internal Control function

Operational and commercial units

President and Group management

Shareholders through the AGM1

Board of Directors4

3

5

Staff functions

Nomination Committee2

Remuneration Committee6



mittee’s tasks are to submit proposals on the election of the Board Chair-man and other members of the Board of Directors, Directors’ fees and any remuneration for committee work, election and remuneration of the auditor, election of the Chairman of the AGM and election of members oftheNominationCommittee.

In performing its other duties, the Nomination Committee shall fulfiltherequirementsincumbentontheCommitteeinaccordancewiththeCode.TheNominationCommitteeappliedrule4.1oftheCodetoitsworkasitsdiversitypolicy.

In accordance with the resolution adopted at the 2020 AGM, the Nomination Committee comprised the following members prior to the 2021 AGM:

Nomination Committee ahead of the 2021 AGM

Name/representingShare of votes

31 Dec 2020

Peter Hofvenstam (Chairman) representing Nordstjernan 24.9%RicardWennerklintrepresentingIfSkadeförsäkring 10.7%MatsGustafssonrepresentingLannebofunds 4.4%ArneLööwrepresentingFourthSwedishNational Pension Fund 7.4%Total 47.4%

The members of the Nomination Committee represent approxi-mately47%ofthesharesandvotesinthecompany.Noremunera-tionispaidtotheCommitteemembers.

The Nomination Committee held four minuted meetings prior to the2021AGM.Allmemberswerepresentatthesemeetings.

The Nomination Committee’s proposals prior to the 2021 AGM are incorporated in the notice of the AGM, which was published on Nobia’swebsiteon25March.

Shareholders are welcome to contact the Nomination Committee and submit proposals by post to: Nobia AB, Nomination Committee, Blekholmsterassen30E7,SE-11164Stockholm,Sweden.

3 AuditorsThe AGM elects the auditor who examines the Annual Report, consoli-datedfinancialstatements,theadministrationoftheBoardandPres-ident, the Annual Report and accounts of subsidiaries, and also sub-mitsanauditreport.

Deloitte AB was re-elected as the company’s auditor at the 2020 AGM for a mandate period of one year until the conclusion of the 2021AGM.TheAuditor-in-ChargeisAuthorisedPublicAccountantDanieldePaula.TheNominationCommittee’sproposalsforauditingfirmand

Auditor-in-Charge prior to the 2021 AGM were presented in the noticeoftheAGM,whichwaspublishedonNobia’swebsiteon25

Nominations Committee activity 2020

Set out below are some of the key matters addressed by the committee.

Board and committee composition• The Nomination Committee held interview and receives informa-

tion from the Board Chairman and other Board members and the CEOabouttheworkoftheBoard.

• Reviewed the composition of the Board to ensure maintenance of an appropriate balance of skills and diversity of experience to supportthefuturegrowthstrategy.

• Concluded that the number of women on the Board elected by thegeneralmeetingcorrespondingto50%.Thegender-distribu-tion requirements of the Swedish Corporate Governance Code arethusdeemedtobemeet.

• Reviewed the continued independence of each Board member, including consideration of their term in the Board and any poten-tialconflictsofinterest.

• Reviewed the time commitment required of each director, conclud-ing that all non-executive directors continued to devote appropri-atetimetoaddresstheirdutiestoNobia.

Corporate governance and other matters• ConsideredtherequirementsoftheBoardinthelongerterm.• Considered and recommended based on the Audit Commit-

tee recommendation the re-election of Deloitte until next Annual GeneralMeeting.

• Recommended the re-election of all directors at the Annual Gen-eralMeeting.

• The Nomination Committee evaluates its instructions every year and presents proposals to the Annual General Meeting when nec-essary.

• Concluded that a majority of the members elected by the general meeting are independent in relation to Nobia and company man-agementandinrelationtoNobia’slargestshareholders.



March.Nobia’spurchasesofservicesfromDeloitte,inadditiontoauditassignments,aredescribedinNote6onpage84.

4 Board of directorsThe primary role of the Board is to lead the Group and to ensure its long-term success, taking into consideration the views and interests of notonlyourinvestors,butourotherkeystakeholders.TheBoard,ledby the Chair, has responsibility for setting, and overseeing the imple-mentation of, the Group’s strategy, ensuring the implementation of an appropriateriskmanagementframeworkandoverseeingfinancialper-formance.UnderpinningthisarethevaluesandculturedefinedbytheBoard and a strong corporate governance framework, designed to ensureethicalandsustainableperformance.

In accordance with Nobia’s Articles of Association, the Board is, to the extent appointed by the General Meeting, to comprise not fewer than three and not more than nine members, with not more thanthreedeputymembers.AmaximumofoneBoardmemberelected by the AGM may work in company management or in the managementofthecompany’ssubsidiaries.Furthermore,amajor-ity of the Board members elected by the AGM are to be indepen-dentinrelationtothecompanyandcompanymanagement.

The objective is for the Board to have an appropriate composition with respect to Nobia’s operations, stage of development, strategy and other circumstances, and be characterised by diversity and

breadth in terms of the skills, experience and background of the Board members elected by the general meeting, and aim for a gen-derbalance.Theboardistoapproveanysignificantassignmentsthechiefexecutiveofficerhasoutsidethecompany

The 2020 AGM resolved that the elected Board was to comprise six memberswithnodeputymembers.TheBoardalsoincludesmem-bers elected by the employees’ organisations in accordance with theSwedishBoardRepresentation(PrivateSectorEmployees)Act.

Other executives in the company participate at Board meetings to make presentations and the Group’s CFO has served as secretary to theBoardfortheentireyear.Duringtheyear,thecommitteeconvenedeleventimes.Allmemberswerepresentatthesemeetings.

The annual evaluation of the Board of Directors’ work, including the Board’s committees (Audit Committee and Remuneration Com-mittee)wasconductedbytheChairoftheBoard,NoraLarssen.Sheevaluated the Board’s working procedures, competence and compo-sition, including the background, experience and diversity of Board members.HerfindingswerepresentedtotheNominationCommit-tee.TheBoardcontinuouslyevaluatestheperformanceofthePresi-dent and CEO, Jon Sintorn and annually meet without management beingpresentinordertoevaluatetheperformance.

Board activity 2020

The key matters considered by the Board during the year are set outbelow.Inaddition,eachmeetingincludesareportfromtheGroup CEO providing an operational update; a report from the GroupCFOontheGroup’sfinancialperformance;andareportonrecentgovernanceandregulatorymatters.

Financial performance• Reviewed and approved the quarterly, half-yearly and full results andtradingupdates.

• ReviewedandapprovedtheNobiaGroupfinancialstatements,ensuringtheyarefair,balancedandunderstandable.

• Considered dividend recommendations and declarations in light oftheGroup’sstateddividendpolicy.

• Reviewed and approved the budget for 2021, considering assump-tions made and the reasonableness of the plan and focusing on theoperationaloverviews,cashflowmanagement.

Strategy formulation and monitoring• A strategy review session, considering where Nobia is today, its

strategic focus, options for future growth and detailed Divisional strategic initiatives, resulting in continued support for Nobia’s strategicdirectionandconfidencethatNobia’sstrategyissus-tainableinthelong-term.

• DiscussedandimplementedthesimplificationofNobia’scorpo-rate structure, resulting in creating strong Commercial Regions and a separate Product & Supply Division to support the Commer-cialRegions.

• Considered and approved a number of capital expenditure proj-ects, taking into consideration the interests of Nobia’s key stake-holders.

• Concluded on the investment of a new factory in Jönköping• Regularreviewofcompetitorandmarketanalyses.

Operational performance• ReportsfromtheGroupCEO.• Consideredsuccessionandtalentmanagementplans.• Monitored the planning of a number of large capital projects, includingtheprepartionforanewfactoryinJönköping.

Governance and stakeholders• Regular reports from the chair of each committee and continu-

ously keept its self updated of governance and regulatory devel-opments.

• EvaluatedtheefficiencyoftheboardworkandconcludeddespitenotbeingabletoholdphyscihalmeetingsandtraveltodifferentsitesdigitaltoolsenabledaneffectiveBoardyear.

• Had three meetings with the auditor without the presence of Group Management.

• ReviewedandapprovedtheprincipalGrouppolicies.• EvaluatedthePresidentsworkduring2020.

Risk management• Recived regular risk reports from management and held a number

of extra ordinary meetings to adress risks associated with corona viruspandemic.

• Sustainbility risks and opportunties including emerging risks were also considered as part of the integrated risk management pro-cess.

• RecivedupdatesonthestatusoftheGroupinsuranceprogram.

Allboarddecisionswereunanimousandnoconflictingopinionswererecordedonanyissuedecidedduringtheyear.DuetotheCovid-19outbreakinearly2020severalmeetingshadeitherindi-rectlyordirectlyaconnectiononhowthispandemicaffectedorcouldaffectNobiaandwhatmitigationacitivitiesthatcouldbetakenproactively.



5 Audit committeeThe committee’s primary responsibility is to oversee the Group’s corporatefinancialreporting,includingtherelationshipwiththeexternal auditor, as well as Nobia’s internal control and risk man-agement framework and to assist the Board with any judgementsanddecision-makingrequiredinthisregard.Thisremainedthekeyfocus of the committee during the year, with its activities being con-sistentwithprioryearsandinlinewithitstermsofreference.TheAudit Committee is selected by the Board at the statutory Board meeting after the Annual General Meeting and until the statutory Boardmeetingthefollowingyear.

The work of the Audit Committee is directed by the Audit Com-mittee Charter, which is reviewed and approved annually by the Board.TheChairofthecommitteehastheaccountingcompetencerequired by the Swedish Companies Act and both of the members areindependentfromtheCompanyanditsmainshareholder.

The Audit Committee is also responsible for supporting the Nom-ination Committee in preparing proposals on the election of exter-nalauditorsandauditor’sfees.TheAuditCommitteereportstotheBoardaftereverymeeting.

Minutes are taken at all Audit Committee meetings and these minutes aremadeavailabletoallBoardmembersandtheauditors.Duringtheyear,thecommitteeconvenedninetimes.Allmemberswerepresentatthesemeetings.

A policy is in place that governs the provision of non-audit services providedbyDeloittetoNobia,differentiatingbetweenthoseservicesthat are permissible and prohibited and including the requirements fortheapprovalofpermissibleservices.Forallnon-auditservices,the business must submit a formal request setting out the objectives, scope of work, likely fee level and the rationale for requiring the work tobecarriedoutbytheGroup’sexternalauditor,aswellassufficient

informationtoallowanassessmentofmateriality.Thecommitteemon-itors compliance with the policy, receiving reports annually summariz-ingtheapprovednon-auditservices.TheGroup’sCFO,HeadofGroupAccounting & Business Control and the Head of Internal Control par-ticipatedintheAuditCommittee’smeetings.In2020,MarleneForsellandArjaTaavenikuwereelectedastheAuditCommittee.

6 Remuneration committeeThe Board appoints a Remuneration Committee from within its ranks, which for the period from the 2020 AGM until the 2021 AGM com-prisedNoraForisdalLarssen(BoardChairman),andJanSvensson.

The Committee’s task is to prepare proposals to the Board relat-ingtotheremunerationandemploymenttermsforthePresident.The Committee also has the task of making decisions on the Pres-ident’s proposals regarding remuneration and other employment termsforthemanagerswhoreporttothePresident.Furthermore,the Committee submits proposals to the AGM regarding principles for remuneration and other employment terms for senior execu-tives and monitors and evaluates the ongoing schemes for variable remuneration to senior executives, and the schemes concluded during the year, and the implementation of the Annual General Meeting’s decision on guidelines for remuneration to senior execu-tives.TheCommitteeheldfivemeetingsduringtheyear.TheBoardofDirectorsresolvedtodeviatefromtheguidelinesduring2020.Board member George Adams has been engaged on a consultancy basis and has received, in addition to his Board fee, compensation forhiswork-efforts.Thebackgroundandreasonswerethat,inJune2020, the former EVP and Head of commercial region UK resigned fromhisposition.Concurrently,theUKoperationsweresubjecttoan ongoing strategic review and the coronavirus outbreak had a negative impact on Nobia in general and the UK operations in partic-

Audit Committee activity 2020

Set out below are some of the key matters addressed by the committee.

Financial reportingReviewedtheintegrityofallfinancialannouncementswithinputprovidedbytheGroupCFO,GroupControllerandDeloitte.• ReviewedtheNobiaGroupfinancialstatementsfortoneandcon-

sistency and considered whether the report as a whole was fair, balancedandunderstandable.

• Considered and agreed the accounting treatment applicable to thesimplificationoftheGroup’scorporatestructure.

• ReviewedanddiscussedDeloitte’sreportstothecommittee.• Reviewed accounting policies to be applied for the year ending 31 December2020.

• Reviewed new accounting pronouncements and any potential impactfortheGroup’sfinancialreporting.

External audit matters• Recommended to the Nomination Committee that the appoint-

ment of Deloitte for the 2021 audit be put to shareholders at the AnnualGeneralMeeting.

• Reviewedtheindependence,objectivityandeffectivenessofDeloitte.

• Reviewed and approved the external audit plan, taking account of thescope,materialityandauditrisksandagreeingtheauditfees.

• Received a report of any non-audit services performed by Deloitte inordertomonitorauditorindependence.

• Reviewedandagreedtheengagementandrepresentationletters.• Held two meetings with Deloitte without management present; the committeechairalsoengagedregularlywiththeleadauditpartner.

Risk management and internal controls• Undertook a review of the Group’s risk management policy, plan andtolerancelevelsandoftheprocesstoassesstherisks.Emerg-ingriskswerealsoconsidered.

• Reviewedtheeffectivenessoftheriskmanagementandinternalcontrolsystems.

• At each committee meeting undertook a more in-depth review of a numberofthemostsignificantGrouprisks.

• Received a presentations on IT risk management and cyber security.

• Received a presentation on Operational Supply Chain risk

Internal Audit• Nobia has a corporate governance function which includes inter-nalauditactivitiesprimrarilytowardsfinancialrisks.Externaland internal resources may also be engaged in the context of certainspecialexaminations.

Governance• Monitored and reviewed the implementation of the Group’s Code ofConduct,aswellasthesupportingpolicyframework.

• ReviewedthelegalandcompliancerisksfacedbytheGroup.• Reviewed the committee’s terms of reference, performance and workprogramme.

• ReviewedreportsreceivedviaNobia’sconfidentialreportinghotline,Speakup.



ular.TosupporttheUKoperationsintheseunforeseenandextraor-dinarychallengingtimes,theBoardconsidereddifferentoptionsand decided that it would be in the best interest of the company to engageBoardmemberGeorgeAdams,whohadsignificantoper-ational and commercial experience, temporarily on a consultancy basis.Duringhisshortconsultancyassignment,GeorgeAdamsreceivedmarket-basedremuneration.TheEVPandbusinessareamanager for the UK who left Nobia in June 2020 received compensa-tion in excess of 12 monthly salaries, the reason for the deviation from thecompensationguidelineswasthattheindividualhadafixed-termcontractthatNobiawasforcedtorenegotiate.TheBoardconsidersthe deviation to be acceptable as this was part of the strategic and long-termchangeinNobia'soperationsintheUnitedKingdom.

Remuneration to senior executivesThemembersofGroupmanagementreceivebothfixedandvariableremuneration.Thefundamentalprincipleisthatthevariablesalaryportionmayamounttoamaximumof40%offixedannualsalary.Theexception to this principle is the President, whose variable salary por-tionmayamounttoamaximumof65%offixedannualsalary.Excep-tions may also be made for other senior executives following a reso-lutionbytheBoard.Thevariablesalaryportionisnormallydividedbetween several targets, for example, the Group’s earnings, earnings in the business unit for which the manager is responsible and individ-ual/quantitativetargets.Thevariableportionisbasedonanearningperiodofoneyear.ThetargetsforthePresidentaredeterminedbytheBoard.Thetargetsfortheotherseniorexecutivesareestablishedbythe President following recommendations by the Board’s Remunera-tionCommittee.

Nobia has implemented long-term share-based remuneration planssince2005,followingdecisionsbyeachyear’sAGM.ThePer-formance Share Plans are described in more detail in the Finan-cialoverviewoftheBoardofDirectors’Reportonpages46-51.TheremunerationandbenefitsofseniorexecutivesaredescribedinNote4onpages79-80.

Group managementThe CEO is responsible for the business development of the com-pany and leads and coordinates the daily operations according to the Board’s instructions for the CEO and other decisions made by the Board.Groupmanagementcomprisedeightindividualsattheendof2020.ForfurtherinformationaboutGroupmanagement,refertopages108-109.Groupmanagementholdsregularmeetingsaccordingtoafixedschedule.Thesemeetingsmonitorstrategicandoperationalprogress, major change programmes, risks and other strategic issues ofsignificancefortheGroupasawhole.Inaddition,thePresidentandthe CFO meet the management team of each commercial business unitseveraltimesperyearatlocalmanagementteammeetings.

Sustainabilty governanceSustainability is an integrated part of our operations and is pursued at vari ous levels, from the Board’s approval of Group-wide policies and principles to operational reviews, risk assessment and goal-ori-entedworkinourbusinessunits.Sustainabilityistopermeatethe

company’s entire business and all employees have a responsibility tocontributetoNobia’ssustainabilityagenda.Oneoftheprincipletasks of Nobias board of directors include identifying how sustain-ability issues impact risks to and business opportunities for Nobia, consequently have sustainbility been integreated in the Strategy andEnterpriseRiskManagementprocesses.Nobia’sengagementand commitment have been implemented in frameworks and work processes.Readmoreonpages50-58.

AuditorsDeloitte AB was re-elected as the company’s auditor at the 2020 AGM for a mandate period of one year until the conclusion of the 2021AGM.TheAuditor-in-ChargeisAuthorisedPublicAccountantDanieldePaula.TheNominationCommittee’sproposalsforaudit-ingfirmandAuditor-in-Chargepriortothe2021AGMwerepresentedin the notice of the AGM, which was published on Nobia’s website on 25March.TheinteractionoftheauditorswiththeBoardisdescribedabove.Nobia’spurchasesofservicesfromDeloitte,inadditiontoauditassignments,aredescribedinNote6onpage84.

Auditor s Report on the corporate governance statement To the general meeting of the shareholders in Nobia AB (publ), cor-porateidentitynumber556528-2752.

Engagement and responsibilityIt is the board of directors who is responsible for the corporate governancestatementforthefinancialyear2020onpages102-107 and that it has been prepared in accordance with the Annual AccountsAct.

The scope of the auditOur examination has been conducted in accordance with FAR’s auditingstandardRevU16Theauditor’sexaminationofthecorpo-rategovernancestatement.Thismeansthatourexaminationofthecorporategovernancestatementisdifferentandsubstantiallylessin scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards inSweden.Webelievethattheexaminationhasprovideduswithsufficientbasisforouropinions.

OpinionsAcorporategovernancestatementhasbeenprepared.Disclo-suresinaccordancewithchapter6section6thesecondpara-graphpoints2-6theAnnualAccountsActandchapter7section31the second paragraph the same law are consistent with the annual accounts and the consolidated accounts and are in accordance withtheAnnualAccountsAct.

StockholmApril6,2021Deloitte AB

Daniel de PaulaAuthorized Public Accountant



Internal control over financial reporting

The Board’s responsibility for internal governance and control is regulated in the Swedish Companies Act, the Annual Accounts Act and the Swedish Corporate Gover-nance Code. The Annual Accounts Act requires that the company, each year, describes its system for internal control and risk management with respect to financial reporting.

Nobia’sinternalcontrolprocessforfinancialreportinghasbeendevelopedtoensureaccurateandreliablefinancialreportingandpreparationoffinancialstatementsinaccor-dance with applicable laws and regulations, generally accepted accounting principles and other requirements for listedcompanies.The internal control process is based on a control framework thatcreatesstructurefortheotherfivecomponentsoftheprocess–IntegratedFramework(2013)issuedbytheCommit-tee of Sponsoring Organizations of the Treadway Commission (COSO).ThefivecomponentsofthisframeworkareControlenvironment, Risk assessment, Control activities, Monitor and improve,andInformandcommunicate.

Control environment TheBoardofDirectorsisresponsibleformaintainingeffec-tive internal control and has therefore established fundamen-taldocumentsofsignificanceforfinancialreporting.Thesedocuments include the Board of Directors’ rules of procedure andinstructionstotheCEO,theCodeofConduct,financialpolicyandanaccountingmanual.AllunitsintheGroupapplyuniformaccountingandreportinginstructions.Internalcon-trol guidelines have been established and are reviewed annu-allyforalloperatingcompanies.TheseGroup-wideguidelineshave a relatively broad scope and concern various processes suchasordering,sourcing,financialstatements,plantman-agement, compliance with various policies, legal matters, and HRmatters.TheCodeofConductisregularlyreviewedandupdated, and compliance is monitored systematically in oper-ations.

Risk assessment Theprimaryriskassociatedwiththefinancialreportingisthe risk that material errors may be made when reporting the company’sfinancialpositionandearnings.Riskassessmentincludesidentifyingrisksofnotfulfillingthefundamentalcri-teria,i.e.,completeness,accuracy,valuationandreport-ingforsignificantaccountsinthefinancialreportingfortheGroup and at regional and local levels, as well as risk of loss ormisappropriationofassetsandliabilities.Nobiahasastandardised process for performing a risk-based evaluation ofitsfinancialrisks.Tominimisethisrisk,controldocuments

have been established pertaining to accounting, proce-dures for annual accounts and follow-up of reported annual accounts.

Control activities The Group Function Finance is responsible for ensuring complete,accurateandtimelyfinancialreporting,includingcompliancewithinstructionsandguidelines.RegionalandlocalChiefFinancialOfficersareresponsibleforensuringthatfinancialreportingfromeachunitiscorrect,completeanddeliveredinatimelymanner.Inaddition,eachbusi-ness unit has head of accounting with responsibility for the individualbusinessunit’sfinancialstatements.Thecompa-ny’s control activities are assessed based on, for example, approved budgets prepared by the individual business units andupdatedduringtheyearwithcontinuousforecasts.Nobia has a standardised system of control measures involvingprocessesthataresignificanttothecompany’sfinancialreporting.Thecontrolsareadaptedtotheopera-tionalprocessandsystemstructureofeachunit.Accord-ingly, each unit prepares a record of the actual controls to becarriedoutintheunitinquestion.

Monitor and improve Significantinstructionsandguidelinesrelatedtofinancialreporting are prepared and updated regularly by the Group FunctionFinanceandareavailableontheGroup’sintranet.AllbusinessunitsreporttheirfinancialresultsmonthlyinaccordancewiththeGroup’saccountingpolicies.Thisreport-ing serves as the basis for quarterly reports and a monthly operatingreview.Operatingreviewsformthebasisofastruc-tureinwhichsales,earnings,cashflow,capitalemployedandotherimportantkeyfiguresandtrendsfortheGrouparecompiled and are used for analysis and actions by manage-mentandcontrollersatdifferentlevels.Financialreviewstakeplace quarterly at regional management meetings, monthly in the form of performance reviews and through more infor-malanalysis.OtherimportantGroup-widecomponentsof internal control comprise the annual business planning processandregularforecasts.Controloftheseprocessesis assessed through self-evaluation, some of these ques-tionsrelatestoantibribery.Controlsthathavefailedmustbe addressed, which means establishing and implementing actionstocorrectweaknesses.Inaddition,independenttest-ing of selected controls is conducted by the Group Internal Controlfunction.Insomecases,Nobiahasenlistedexternalhelptovalidatethesecontrols.Financialresultsarereportedand examined regularly within the management teams of the operating units and communicated to Nobia’s management at monthly and quarterly meetings Information on the status and where the internal control process can be enhanced is



Improvement

Information and

communication

Risk assessment

Control activities

Monitoring including follow-ups

and evaluations

periodically provided to Group management, the Audit Board andtheAuditCommitteebytheHeadofInternalControl.

Financial reporting to the Board The Board’s rules of procedure stipulate which reports and informationofafinancialnaturearetobesubmittedtotheBoardateachscheduledmeeting.TheCEO,togetherwiththe Chairman, ensures that the Board receives the reports required to enable the Board to continuously assess the com-pany’sandGroup’sfinancialposition.DetailedinstructionsspecificallyoutlinethetypesofreportsthattheBoardistoreceiveateachmeeting.

External financial reporting Thequalityofexternalfinancialreportingisguaranteedviaanumberofactionsandprocedures.Nobia’sCEOisresponsible for ensuring that all information issued, such as pressreleaseswithfinancialcontent,presentationmaterialformeetingswiththemedia,ownersandfinancialinstitu-tions,iscorrectandofahighquality.Theresponsibilitiesofthe company’s auditors include reviewing accounting issues thatarecriticalforthefinancialreportingandreporting

their observations to the Audit Committee and the Board of Directors.Inadditiontotheauditoftheannualaccounts,areview of the report for the third quarter and of the compa-ny’sadministrationiscarriedout.inform and communicate

The company has information and communication chan-nelsdesignedtoensurethatinformationisidentified,capturedand communicated in a form and time frame that enable man-agers and other employees to carry out their responsibilities, and contributes to ensuring that the correct business decisions aremade.Guidelinesforfinancialreportingarecommuni-cated to employees, for example, by ensuring that all manuals, policies and codes are published and accessible through the Group-wide intranet as well as information related to the inter-nalcontrolprocess.Toinformandcommunicateisacentralelement of the internal control process and is performed con-tinuouslythroughouttheyear.Management,processownersand control operators in general are responsible for informing and communicating the results within the internal control pro-cess.OutcomesarereportedandregularlydiscussedatAuditCommitteemeetings.



Board of Directors

Hans Eckerström, Chairman, attended six meetings and one RemunerationCommitteemeeting,lefttheBoardon5May2020.Totalremuneration2020:SEK400,000.

Jill Little, Board member, attended six meetings, left the Board on 5May2020.Totalremuneration2020:SEK140,000.

Stefan Jacobsson, Board member, attended six meetings, left the Boardon5May2020.Totalremuneration2020:SEK140,000.

Auditors Deloitte ABAuditor-in-charge Daniel de Paula, Authorised Public AccountantOtherauditassignments:PermobilandBAEHägglunds.

Nora Førisdal LarssenChairman of the Board

Year elected 2011Born 1965Nationality NorwegianEducation B.Sc.Economics,MBA.Other assignments Senior Investment Manager at Nordstjernan.BoardmemberofDisruptive Materials, chairman ofEtacandEmmaS.Work experience ProductLinemanageratElec-trolux and partner at McKinsey &Co.

George Adams Board member

Year elected 2017 Born 1956Nationality BritishEducation Politics, Philosophy & Economics, Oxford UniversityOther assignments ChairmanofFXTools. BoardmemberofScS.Work experience SeniorpositionsatKingfisher.President of the European DIY RetailersAssociation(EDRA).

Marlene Forsell Board member

Year elected 2019Born 1976Nationality SwedishEducation B.Sc.BusinessAdministrationStockholm School of EconomicsOther assignments Board member of Kambi Group, LimeTechnologies,AddSecureandIndexPharmaceuticals.Work experience CFOofSwedishMatch2013–2018andbeforethatseveralleadingpositionsinfinanceatthesamecompany.

Jan Svensson Board member Year elected 2020Born 1956Nationality SwedishEducation B.Sc.BusinessAdministrationStockholm School of EconomicsOther assignments Chairman of Tomra Systems ASAandFagerhult.Boardmem-berofASSAABLOY,Billerud-Korsnäs,Loomis,Climeon,StenaMetallandHerenco.Work experience CEO and Board member of InvestmentABLatour2003–2019.

Arja TaavenikuBoard member

Year elected 2020Born 1968Nationality SwedishEducation Executive MBA, Stockholm School of EconomicsOther assignments Board member of Handels-banken, Mekonomen and Dun-elmPlc.ChairmanofSvenskaHandelsfastigheterWork experience Amongothers,ChiefOfferandSupplyChainOfficeratKing-fisherPlc2015-2018,CEOIkanoGroup2012-2015andBusiness Area Director, IKEA Kitchen&Dining2009–2012.

Carsten RasmussenBoard member

Year elected 2020Born 1972Nationality DanishEducation MasterofLogisticsfromAarhusUniversityOther assignments ChairmanofLEGOSystemA/S.Work experience COOofLEGOGroupsince2017, where he has been employedsince2001.Previousexperience including positions atScanChocoA/S1997–2001.


Board of Directors

Board of Directors 2020

Assignment Independent

Own and related par-ties’ share-

holdings

Shares in related

companies

Board of Directors’ meetings,

13 meetings

Audit Committee, 9 meetings

Remune-ration

Committee, 4 meetings

Remune-ration

2020, SEK

Of which Board,

SEK

Of which Committee,

SEK

Nora Førisdal Larssen, Chairman of the Board No 5,000 – 13 3 4 940,000 907,000 33,000George Adams, Board member Yes – – 13 – – 793,0001 410,000 –Marlene Forsell, Board member Yes 5,500 – 13 9 – 560,000 410,000 150,000Jan Svensson, Board member Yes 20,000 – 7 – 3 270,000 270,000 –Arja Taaveniku, Board member Yes – – 7 6 – 360,000 277,000 83,000Carsten Rasmussen, Board member Yes – – 7 – – 270,000 – –Per Bergström, Employee representative – – – 13 – – – – –Susanne Levinsson, Employee representative, deputy – – – 13 – – – – –Terese Asthede, Employee representative – – – 13 – – – – –Mats Karlsson, Employee representative, deputy – – – 13 – – – – –1)GeorgeAdamswascompensatedSEK383,000formanagementsupportservicesintheUKduringApril,MayandJune2020.Seepage106.

Per BergströmEmployee representative

Year elected 2000Born 1960Nationality SwedishEducation –Other assignments Board member of Tidaholms Energi, Elnät, Bredband Östra Skaraborg and Nobia Produc-tionSweden.Work experience Various roles within production, NobiaProductionSweden.

Susanne LevinssonEmployee representative, deputy

Year elected 2017 Born 1973Nationality SwedishEducation Highschooldiploma.Other assignments –Work experience Various roles within production, NobiaProductionSweden.

Terese AsthedeEmployee representative

Year elected 2013Born 1971Nationality SwedishEducation Post-secondary education, logisticsOther assignments –Work experience Various positions within sales and project management, Nobia.

Mats KarlssonEmployee representative, deputy

Year elected 2019Born 1976Nationality SwedishEducation MasterofPolitics.BusinessanalystOther assignments –Work experience Managerial roles within sourc-ing,NobiaProductionSweden.


Board of Directors

Group management

Jon SintornPresident and CEO

Born 1966Employed2019Previous positions PresidentandCEOofPermobil.GlobalheadofCooling,DeLa-val.VariouspositionsatABB.Holding in Nobia 1,791,120calloptions.

Kristoffer LjungfeltChiefFinancialOfficer(CFO)

Born 1977Employed 2013Previous positions CFONordicregioninNobia.Finance Director in Nobia Nor-way and Business Area Director inSigdalKjøkken.Variuosposi-tionsatElectrolux.Holding in Nobia 28,179shares(privateand occupationalpension). 145,560calloptions.

Ola CarlssonEVP Chief Product Supply Officer

Born 1965Employed 2017Previous positions Group Vice President Global Operations at Munters and ChiefOperationsOfficeratElectroluxSmallAppliances.Holding in Nobia 33,894shares.

Cecilia ForzeliusEVP People & Culture

Born 1975Employed 2020Previous positions ChiefPeopleOfficerandHRDirector Northern Europe, Transcom.Variousmanage-ment positions at Skandia and Telia.Holding in Nobia –

Ole DalsbøEVP Commercial Region North (Nordic region)

Born 1966Employed 2004Previous positions Leadingpositionsat Nobia Norway, Norema andSigdalKjøkken.Holding in Nobia 26,298shares.

Dan CarrEVPCommercialRegionWest(UK region)

Born 1975Employed2005Previous positions CFO UK Region, NobiaHolding in Nobia 4,377shares.

Sara BjörkChiefInformationOfficer (CIO)

Born 1973Employed 2020Previous positions Head of IT for H&M Group’s IT division for design, sourcingandproduction.Holding in Nobia –

Dan JosefsbergEVP, Marketing, Customer Experience and Communication

Born 1973Employed2019Previous positions Managing Partner of PwC ExperienceCenterandPond.Holding in Nobia 23,712 shares (through companies).


Group management


The Nobia share and shareholders


The Nobia share is listed on Nasdaq Stockholm and is included in the Consumer Products and Services sector. Following a sharp downturn at the start of the coronavirus pandemic, the share recovered and closed down 6% for the full year. Market capitalisation at the end of 2020 was SEK 11.2 billion.

Listing and turnover The Nobia share has been listed on Nasdaq Stockholm since 2002, where the share is included in the Consumer Products and Services sector.ThemajorityofthesharesaretradedonNasdaqStockholm,butsomesharesarealsotradedonothermarketplaces.In2020,atotalof139millionNobiashares(76)weretradedon

NasdaqStockholmatavalueofSEK6.9billion(4.4).Theaverageturnoverperdaywasapproximately552,000shares(303,000),correspondingtoavalueofSEK27m(17).TheNobiashare’sliquid-ity,measuredasrateofturnover,totalled75%(45).TheaveragerateofturnoverontheStockholmexchangewas75%(62).

Share performanceThe share had a weaker performance than the stock exchange as awholein2020.Thesharepricedeclined6%,comparedwiththeStockholm exchange in total, which increased 13% in the same period.Duringtheyear,theOMXSStockholmConsumerProductsandServicesindexincreased51%.TheclosingpricefortheNobiasharein2020wasSEK65.85,cor-

respondingtomarketcapitalisationofSEK11.2billion.Thehigh-estpricepaidin2020wasSEK75.9on14January.ThelowestpricepaidduringtheyearwasSEK29.8on19March.

Share capitalOn 31 December 2020, Nobia’s share capital amounted to SEK 56,763,597,dividedbetween170,293,458shareswithaquotientvalueofSEK0.33.Eachshare,withtheexceptionofbought-backtreasury shares, entitles the holder to one vote, and carries the sameentitlementtothecompany’scapitalandprofits.

Dividend policy Nobia’s dividend policy is that the dividend should comprise 40-60%ofnetprofitaftertax.Investmentrequirements,acquisi-tionopportunities,liquidityandthefinancialpositionofthecom-pany in general are taken into consideration when preparing divi-dendproposals.

Proposed dividendTheBoard’sproposalforthe2020dividendisSEK2pershare.Duetotheuncertaintyrelatingtotheeffectsofthespreadofthecorona virus at the beginning of 2020, the Board of Directors with-drewitsdividendproposalfor2019andnodividendwaspaidfor2019.

Treasury sharesAtthestartof2020,Nobiaowned1,440,637treasuryshares,cor-respondingto0.8%ofthetotalnumberofsharesissued.Notrans-actions involving treasury shares were conducted in 2020 and the numberoftreasurysharesthereforeamountedto1,440,637attheendof2020.ThepurposeoftreasurysharesistosafeguardNobia’scommitmentsundertheGroup’sshare-basedremunerationplan.

Ownership structureAtyear-end,Nobiahad18,793shareholders(16,136).Swedishown-ershipwas73%(75),whileforeignownershipduringtheyearincreasedto27%(25).ThelargestforeignshareholdingswereintheUS,withapproximately12%,andtheUK,withapproximately8%.Thefivelargestshareholders–Nordstjernan,IfSkadeförsäkring,

the Fourth Swedish National Pension Fund, Swedbank Robur funds andLannebofunds–owned52.6%(52.0)ofallsharesatyear-end.Thetenlargestshareholdersowned67.6%(65.9)oftheshares.

Shareholdings among persons in senior positionsAt the time of publication of this Annual Report, Group manage-mentowned,directlyandindirectly,2,053,140sharesandcalloptionsinNobia(1,771,174).Onthesamedate,Nobia’sBoardmembershadtotaldirectandindirectholdingsof30,500shares(60,000).

Share dataListing: NasdaqStockholm,LargeCapTicker: NOBISector: Consumer Products and Services ISIN code: SE0000949331

Analysts that follow NobiaCompany Analyst

Carnegie Kenneth Toll JohanssonDNB Markets Mattias HolmbergHandelsbanken Adela DashianNordea Victor HansenSEB Julius RapeliPareto Fredrik Moregård



Ownership structure, 31 December 2020

Number of shareholders

Percentage of shareholders,

% No. of sharesPercentage of

capital, %

1–500 14,411 76.7% 1,775,015 1.0%501–1000 1,932 10.3% 1,590,800 0.9%1,001–5,000 1,833 9.8% 4,089,009 2.4%5,001–10,000 266 1.4% 1,972,322 1.2%10,001–15,000 79 0.4% 1,007,642 0.6%15,001–20,000 47 0.3% 830,686 0.5%20,001– 225 1.2% 159,027,984 93.4%Total 18,793 170,293,458

Largest owners, 31 December 2020

Shareholder No. of sharesPercentage of

capital, %

Nordstjernan AB 42,432,410 24.92IF Skadeförsäkring AB 18,200,000 10.69Fourth Swedish National Pen-sion Fund 12,645,559 7.43Swedbank Robur funds 8,717,659 5.12State Street Bank and Trust 7,759,408 4.56Lannebofunds 7,562,692 4.44BNY Mellon SA/NV 4,531,258 2.66CBNY-Norges Bank 3,998,936 2.35BNY Mellon NA 3,745,921 2.2JPMorganChaseBankN.A. 3,624,617 2.13The 15 largest owners 126,088,718 74.1Source:EuroclearSweden.

Atyear-end,Nobiaheld1,440,637treasuryshares,correspondingto0.8%ofallshares.

Data per share2016 2017 2018 2019 2020

No.ofsharesatyear-end (millions) 175.3 175.3 170.3 170.3 170.3No.ofsharesatyear-endafter dilution (millions) 168.7 168.7 168.7 169.3 169.3Averageno.ofsharesatyear-end after dilution (mil-lions) 168.7 168.7 168.7 169.0 169.3Share price at year-end, SEK 84.85 69.40 49.24 69.80 65.85Earnings per share after dilution, SEK 2.70 6.02 4.46 4.79 1.50Shareholders’ equity per share, SEK 20 25 23 25 24Dividend per share, SEK 3.00 7.00 4.00 0 2.001

P/E ratio, multiple 31 12 11 15 44Direct yield, % 3.5 10.0 8.1 0 3.0Share of dividend, % 111 116 90 0 133 1) Proposed dividend

150

100

50

0

90

60

30

0

28,000

20,000

12,000

4,000

0

9,000

6,000

3,000

0

Nobia Turnover number of shares, OMX Stockholm Benchmark PI thousand each month OMX Stockholm Consumer Goods PI Source:WebfinancialGroup

Nobia Turnover number of shares, OMX Stockholm Benchmark PI thousand each week OMX Stockholm Consumer Goods PI Source:WebfinancialGroup

2015 2016 2017 2018 2019 2020 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec


Five-year overview

Five-year overview

SEK m 2016 2017 2018 2019 2020

Income statementNet sales 12,648 12,744 13,209 13,930 12,741Change in % 3 1 4 5 -9Grossprofit 4,933 5,014 5,090 5,305 4,444Operatingprofit 1,298 1,286 1,018 1,132 437Financial income 22 9 10 1 7Financial expenses -73 -45 -42 -94 -91Profit after financial items 1,247 1,250 986 1,039 353Taxonnetprofitfortheyear -269 -256 -233 -229 -100Profitforcontinuingoperations 978 994 753 810 253Profitfromdiscontinuedoperations,netaftertax -523 21 – – –Net profit for the year 455 1,015 753 810 253Netprofitfortheyearattributableto:Parent Company shareholders 456 1,015 753 810 253Non-controlling interests -1 0 – – –Net profit for the year 455 1,015 753 810 253

Balance sheetFixed assets 4,076 4,034 4,759 7,641 6,806Inventories 857 908 962 1,145 1,035Current receivables 1,561 1,765 1,917 1,803 1,609Cash and cash equivalents 1,005 473 128 257 635Assets held for sale 506 – – – –Total assets 8,005 7,180 7,766 10,846 10,085Shareholders’ equity 3,415 4,154 3,897 4,277 4,034Non-controlling interests 4 – – – –Non-interest-bearing liabilities 2,556 2,453 2,440 2,487 3,027Interest-bearing liabilities 1,701 573 1,429 4,082 3,024Liabilitiesattributabletoassetsheldforsale 329 – – – –Total shareholders’ equity and liabilities 8,005 7,180 7,766 10,846 10,085Net debt including pensions 493 77 1,266 3,819 2,387Capital employed 5,182 4,727 5,326 8,359 7,058Operating capital 3,912 4,231 5,163 8,096 6,421

Performance measures Gross margin, % 39.0 39.3 38.5 38.1 34.9Operating margin, % 10.3 10.1 7.7 8.1 3.4Operatingprofitbeforedepreciation/amortisationandimpairment (EBITDA), % 1,585 1,573 1,344 1,967 1,426Operating margin before depreciation/amortisation and impairment, % 12.5 12.3 10.2 14.1 11.2Profitafterfinancialitemsasapercentageofnetsales 9.9 9.8 7.5 7.5 2.8Turnover rate of operating capital, multiple 3.2 3.0 2.6 1.7 2.0Return on operating capital, % 32.5 31.5 21.7 14.2 6.0Return on equity, % 13.0 27.8 20.2 20.4 6.1Debt/equity ratio, % 14 2 32 89 59Equity/assets ratio, % 43 58 50 39 40Cashflowfromoperatingactivities 1,281 987 1,001 1,633 2,068Investments 290 319 414 465 308Earnings per share after dilution 2.70 6.02 4.46 4.79 1.50Dividend per share, SEK 3.00 7.00 4.00 0.00 2.001

Personnel Average number of employees 6,573 6,178 6,178 6,161 5,977Netsalesperemployee,SEK000s 2,121 2,094 2,172 2,280 2,159Personnel expenses 3,225 2,939 3,135 3,343 3,357Number of employees at year-end 6,445 6,087 6,081 6,109 5,9011)TheBoard’sproposal.


Definitions – Performance measures

Definitions – Performance measures

Performance measures

Definition/calculation Use

Return on equity

Profitaftertaxasapercentageofaveragesharehold-ers’ equity attributable to Parent Company sharehold-ersbasedonopeningandclosingbalancesfortheperiod.The calculation of average shareholders’ equity has been adjustedforincreasesanddecreasesincapital.

Return on equity shows the total return on shareholder’s capi-talinaccountingtermsandreflectstheeffectsofboththeoper-ationalprofitabilityandfinancialgearing.Themeasureispri-marilyusedtoanalyseshareholderprofitabilityovertime.

Return on operating capital

Operatingprofitasapercentageofaverageoperatingcapital based on opening and closing balances for the period excluding net assets attributable to discontinued operations.Thecalculationofaverageoperatingcapitalhasbeenadjustedforacquisitionsanddivestments.

Return on operating capital shows how well the operations use netcapitalthatistiedupinthecompany.Itreflectshowbothcostandcapital-efficiencynetsalesaregenerated,meaningthecombinedeffectoftheoperatingmarginandtheturnoverrateofoperatingcapital.Themeasureisusedinprofitabilitycomparisons between operations in the Group and to view the Group’sprofitabilityovertime.

Gross mar-gin

Grossprofitasapercentageofnetsales. Thismeasurereflectsefficiencyofthepartoftheoperationsthatisprimarilylinkedtoproductionandlogistics.Itisusedtomonitorcostefficiencyinthispartoftheoperation.

EBITDA Earnings before depreciation/amortisation and impair-ment.

To simplify, this measure shows the earnings-generating cash flowintheoperation.Itprovidesaviewoftheabilityoftheopera-tion, in absolute terms, to generate resources for investment and paymenttofinanciersandisusedforcomparisonsovertime.

Items affect-ing compa-rability

Itemsthataffectcomparabilityinsofarastheydonotreoccurwiththesameregularityasotheritems.

Reportingitemsaffectingcomparabilityseparatelyclearlyshowstheperformanceoftheunderlyingoperation.

Net debt Interest-bearingliabilitieslessinterest-bearingassets.Interest-bearing liabilities also include pension liabilities andleaseliabilities.

Net debt is used to monitor the debt trend and see the level of therefinancingrequirement,pensionandleaseliabilities.Themeasureisusedasacomponentinthedebt/equityratio.

Operating capital

Capitalemployedexcludinginterest-bearingassets. Operating capital shows the amount of capital required by the operationstoconductitscoreoperation.Thisisthecapitalthatgeneratesoperatingprofit.Itismainlyusedtocalculatethereturnonoperatingcapital.

Operating cash flow

Cashflowfromoperatingactivitiesincludingcashflowfrominvestingactivities,excludingcashflowfromacqui-sitions/divestments of operations, interest received, increase/decreaseininterest-bearingassets.

Themeasurecomprisesthecashflowgeneratedbytheunder-lyingoperation.ThemeasureisusedtoshowtheamountoffundsattheGroup’sdisposalforpayingfinanciersofloansandequityorforuseingrowththroughacquisitions.

Organic growth

Change in net sales excluding acquisitions and divest-mentsandchangesinexchangerates.

Organic growth facilitates a comparison of sales over time by comparingthesameoperationsandexcludingcurrencyeffects.

Region RegioncorrespondstoanoperatingsegmentunderIFRS8.

Earnings per share

Netprofitfortheperioddividedbyaweightedaveragenumberofoutstandingsharesduringtheperiod.

Operating margin

Operatingprofitasapercentageofnetsales. Themeasurereflectstheoperatingprofitabilityoftheoperations.Itisusedtomonitortheprofitabilityandefficiencyoftheoperations,beforetakingintoaccountcapitaltiedup.Theperformancemeasureis used both internally in governance and monitoring of the opera-tion,andforbenchmarkingwithothercompaniesintheindustry.

Debt/equity ratio

Net debt as a percentage of shareholders’ equity including non-controllinginterests.

AmeasureoftheratiobetweentheGroup’stwoformsoffinanc-ing.Themeasureshowsthepercentageoftheloancapitalinrelation to capital invested by the owners, and is thus a mea-sureofthefinancialstrengthbutalsothegearingeffectoflend-ing.Ahigherdebt/equityratiomeansahigherfinancialriskandhigherfinancialgearing.

Equity/assets ratio

Shareholders’ equity including non-controlling interests as apercentageofbalance-sheettotal.

Thismeasurereflectsthecompany’sfinancialpositionandthusitslong-termsolvency.Ahealthyequity/assetsratio/strongfinan-cial position provides preparedness for managing periods of eco-nomicdownturnandfinancialpreparednessforgrowth.Italsoprovidesaminoradvantageintheformoffinancialgearing.

Capital employed

Balance-sheet total less non-interest-bearing provisions andliabilities.

The capital that shareholders and lenders have placed at the com-pany’sdisposal.Itshowsthenetcapitalinvestedintheoperations,suchasoperatingcapital,withadditionsforfinancialassets.

Currency effects

Translationdifferencesreferstothecurrencyeffectsaris-ing when foreign results and balance sheets are translated toSEK.Transactioneffectsreferstothecurrencyeffectsaris-

ing when purchases or sales are made in currency other than the currency of the producing country (functional currency).


Sustainability

Sustainability data

Sustainability is an important component of our operations. The focus and direction of our sustainability efforts are determined by our impact, the possibilities available to us and demands from our stakeholders.

Framework for sustainability topicsNobia’s framework for sustainability topics includes internal and exter-nal guidelines and regulations, sustainability strategy, processes, datacollection,monitoringandreporting.Readmoreaboutourinter-nal and external guidelines and voluntary commitments on page 103 and119.

At Group level, there is a management system for overall man-agement of the Group’s sustainability topics, such as stakeholder dialogues,materialityandriskanalyses,datacollection,etc.Thesustainability management system is an internal tool for business governance that is used to help systematically monitor compliance withthestrategyandtheGroup’sobjectives.

Our main stakeholders and communication channelsUnderstanding the expectations of key stakeholders is crucial for beingabletomeetcurrentandfutureneeds.Nobia’sstakehold-ersareidentifiedbasedonthegroupsimpactedbyouroperationsandthegroupsthatimpactouroperations.Variousformsofstake-holder dialogues provide us with information about the economic, environmental and social issues that are priorities for our stake-holdergroups.

Shareholders and investors: Meetings, annual reports, interim reports,pressreleases,website,regularsurvey.Employee repre-sentatives: EuropeanWorksCouncil,regularsurvey.Civil soci-ety, professional associations and academia: Meetings, sur-veysandrankings,regularsurvey.Customers: Meetings, focus groups,socialmedia,regularsurvey.Suppliers: Ongoing dialogue in the purchase process, supplier risk assessment, audits, Speak Up (anonymousreportingchannel),regularsurvey.Employees: Con-tinuous dialogue, meetings, employee surveys, training courses, appraisals,SpeakUp,regularsurvey.

Process of identifying and managing material topicsOurprocessofdefiningmaterialtopicssetstherelevanteconomic,environmental and social aspects that are to be prioritised in our work andtoreporton.Weanalyseourvaluechainbasedonourexistinglist of material topics and update it based on new information from impact analyses, monitoring the business world, risks and opportuni-tiesidentifiedandinputfromdialoguewithourstakeholders.

Our material topics are prioritised based on the impact they have on Nobia’s business, the impact they have on the environment and people,andhowimportanttheyaretoourprimarystakeholders.Themateriality analysis is updated and validated every year by the cen-tral sustainability function in consultation with other parts of Group management.Thisyear’sreview,whichalsolaysthefoundationforournew2021–

2026sustainabilitystrategy,didnotleadtoanymaterialchanges.However, based on the topics and their strategic importance to our operations, we have decided to further develop the topics so that they generatemaximumvalue.

These material topics form the basis of what we measure, monitor and report on in this report, and what forms the basis of our sustain-abilitystrategyandourtargets.Thetableonpage119liststhetopicsthat we focus on, where in the value chain we work, primary stakehold-ers,andthetoolsandcontrolsforthesetopics.Thetablealsopresentsthe topics that we employ to contribute to the UN Sustainable Develop-mentGoalsandhowwemeettheprinciplesoftheGlobalCompact.

Identifying sustainability risks is part of the materiality process and is coordinatedwiththeGroup’sriskprocess.Readmoreabouttheiden-tificationandmanagementofsustainability-relatedrisksonpages50-58.

Governance, organisation and monitoringSustainability is integrated throughout the operations and our com-mitmenthavebeenimplementedinframeworksandprocesses.Fulfil-ment of these targets and compliance with both the sustainability strategy and the Group’s sustainability framework are systemati-cally monitored through our new sustainability management sys-tem.Thissystemisaninternaltoolforbusinessgovernance.

A central sustainability function is in place at Group level, respon-sibleforstrategicsustainabilityactivities.ThePresidentreceivesmonthlysustainabilityreports.Sustainabilitytopicsarealsoaregu-larrecurringitemontheBoard’sagenda.Eachproductionunithasemployees whose main work duties involve environmental and sus-tainabilityissues.Theproductdevelopmentandsourcingunitshavespecialistfunctionsthatdriveeffortswith,forexample,productsafety,eco-labellingandsupplieraudits.

Sustainability-related procedures and processes, for example, in product development, sourcing, marketing managing product labellingandcertification,areintegratedintothesystemsandpro-cessesofeachfunction.Forinstance,theproductdevelopmentprocess carries out systematic product risk assessments and com-pliance with environmental legislation takes place within the frame workofthelocalenvironmentalmanagementsystems.

During the year, Nobia had no product safety incidents that led toinsurancecasesorlegalproceedings.NobusinessunitinNobiawas convicted of environmental crimes or reported deviations relatedtolabellingofproducts.

Strategic memberships and partner projects:• BSI (British Standards Institute) • CIK (Circular Kitchen project• Cooperation with TU Delft on circular solutions• IVLSwedishEnvironmentalResearchInstitute• Möbelfakta’s criteria council• Science-Based Target initiative• SIS (Swedish Standard Institute) Furniture Standardisation Committee• TMF(SwedishFederationofWoodandFurnitureIndustry)Sus-

tainability Group• TMF(SwedishFederationofWoodandFurnitureIndustry)Techni-

cal Committee• UN Global Compact• Västa Götaland Network, quality and environment skills exchange

Certified management systems Ourproductionfacilitiesholdmanagementsystemcertificationinquality,environment,energyandoccupationalhealthandsafety. Amongourmarketcompanies,NobiaSvenskaKökhasISOqualityandenvironmentalcertification.Standard Unit

ISO9001 Bjerringbro,Darlington,Dewsbury,Dinxperlo,Freistadt,Halifax,Morley,Tidaholm,Wels,ØlgodISO 14001 Bjerringbro,Darlington,Dewsbury,Dinxperlo,Farsö,Freistadt,Grays,Halifax,Morley,Nastola,Tidaholm,Wels,ØlgodISO50001 Darlington, Dewsbury, Halifax, MorleyOHSAS18001 Darlington, Dewsbury, Halifax, MorleyISO45001 Berringbro1,Ølgod1, NastolaISO 14001, ongoing

Eggedal

1)BjerringbroandØlgodareawaitingapprovalof,forexample,anewassemblylinerelatedtoheavyliftingbeforeISO45001certificationcanbeapproved.


Sustainability

Material topics, governance and monitoring

Innovations for a sustainable lifestyle Circular materials and flows

Reduced climate impact Promoting a sustainable culture

Areas Choice of mate-rial, environmen-tal labelling, life-cycle analysis

Resource con-sumption, chem-icals, packaging, waste manage-ment

Certifiedwood,recycled wood

Energy consump-tion, transpor-tation, materials and products

Health and safety, human rights, labour rights, equality, diversity, anti-corruption

Environment, human rights, labour rights and anti-corruption

Boundary Product develop-ment, suppliers, own production, sales, customer use

Product develop-ment, suppliers, own production, customer use

Suppliers Suppliers, own production, transportation, customer use

Own operations Suppliers

Principal stakeholders

Shareholders and investors, cus-tomers, suppliers, employees

Shareholders and investors, cus-tomers, suppliers

Shareholders and Investors, civil society, pro-fessional associ-ations and aca-demia, customers

Shareholders and investors, employee repre-sentatives, cus-tomers, suppliers, employees

Shareholders and investors, employee repre-sentatives, cus-tomers, suppliers, employees

Shareholders and investors, employee representatives, civil society, profes-sional associations and academia, cus-tomers

Internal frameworks1

Environment & cli-mate policy; Sus-tainability strat-egy


Environment & cli-mate policy; Pol-icy for sustain-able forestry; Code of Con-duct for Suppli-ers, Sustainabil-ity strategy


Code of Con-duct, Modern Slavery policy, Sustainability strategy

Supplier Code of Conduct; Mod-ern Slavery policy; environment & cli-mate policy, Sus-tainability strategy

Work method Sustainability scorecard for products, Sus-tainability man-agement system6, FMEA8

Sustainability scorecard for products, Sus-tainability sys-tem3,LEANsys-tem,ISO140012

System with requirements and monitoring for responsible sourcing of wood materials, SAF4, NSAR5

Central score-card for produc-tion, Sustain-ability system3, ISO140012, ISO 500016

Central score-card for produc-tion, System-atic health and safety activities in production, SpeakUp, HR pro-cesses, OHSAS 18001andISO450017

SAF2, NSAR3, Speak Up

Contribution to the UN Sustainable Development Goals:

8.4Improveresourceeffi-ciency in con-sumption and production.12.8Promote univer-sal understand-ing of sustain-able lifestyles

8.4Improveresourceefficiencyincon-sumption and production12.5Substantiallyreducewastegen-eration15.2Promoteimplementationofsus-tainable forestry17.17Encourageeffectivepartnerships

13.1Strengthenresilience and adaptive capac-ity to climate-re-lateddisasters.

8.8Protectlabourrightsandpromotesafeworkingenvironmentsforall12.8Promote universal understanding of sustainable lifestyles17.6Revitalizetheglobalpartnershipfor sustainable development

UN Global Compact principles9

1,7,8,9 2,7,8,9 7,8,9 1,2,3,6,7,10

Goals, mon-itoring and results

Refer to pages 30,31

Refer to pages 30,31

Refertopage31 Refer to pages 32,33

Refer to pages 34,35,57

Refertopage36

1)Forexternalframeworks,seepage103.2)Certifiedenvironmentalmanagementsystemforproductionplants.3)Group-widesustainabilitymanagementsystem.4)Digitalplatformforsustainabilityauditsofsuppliers.5)Supplierauditsystem.6)Certifiedenergymanagementsystemsforproductionfacilities7)FailureModeandEffectAnalysis,systematicproductriskassessment8)Certifiedmanagementsystemforworkenvironmentforproductionfacilities9)PrinciplesoftheUNGlobalCompacthumanrights(princi-ples1–2),labour(principles3,4,5,6),environment(principles7,8,9)andanti-corruption(principle10).

Programs for responsible sourcing, number2019 2020

Significantsuppliers 294 287Sustainability-reviewed suppliers 279 285

Suppliers approved after review 246 257Suppliers with audit requirements 33 28

Suppliers approved after audit 14 6Suppliers not approved after audit (in current programmes) 6 0Suppliers awaiting audit (in current programmes) 13 22

TheinformationinthetableshowsthestatusofNobia’ssupplierprogrammeattheendofeachyear.Noauditswereperformedin2020.Readmoreonpage36.


Sustainability

Sustainability dataUnit 2018 2109 2020

Direct economic value generated and distributedNet sales SEK m 13,209 13,930 12,741Operating expenses SEK m 8,823 8,955 8,633Employeewagesandbenefits SEK m 2,544 2,750 2,769Social security contributions and pensions SEK m 591 593 588Taxes to state and municipality SEK m 233 229 100Interest to lenders SEK m 4 17 24Dividends to shareholders SEK m 1,180 675 0Economic value retained SEK m -166 711 627

MaterialsWoodconsumption thous.ofm3 417 429 374

Energy consumptionTotal energy consumption GWh 195 183 169Non-renewable fuel GWh 51 52 41Renewable fuel GWh 53 21 21Electricity and heating pur-chased GWh 101 110 107Heating sold GWh 11 0 0Energy intensity, electricity and heating kWh/cabinet 27 25 27

Significant air emissions

Scope 1 thous.oftonnes CO2e 13.2 12.6 10.2

Scope 2, market-basedthous.oftonnes CO2e 5.3 0.7 0.6

Scope 31 thous.oftonnes CO2e 19.2 18.1 15.3

Biogenic emissionsthous.oftonnes CO2e 19.1 8.0 6.9

Scope 2, local-basedthous.oftonnes CO2e 15.2 16.8 13.6

CO2 intensity, electricity and heating

kg CO2e/cabinet 0.9 0.8 0.7

CO2 intensity, transportationkg CO2e/cabinet 4.3 3.5 3.5

VOC2 tonnes 316 298 262VOC intensity per lacquered details

kg VOC/100 details 5.0 4.9 4.3

WasteTotalwaste(excl.hazardouswaste)

thous.oftonnes 41.0 44.9 44.1

Wasteforreusethous.oftonnes n.a. 0.3 0.7

Wasteforrecyclingthous.oftonnes 20.7 28.3 27.6

Wasteforincinerationthous.oftonnes 19.8 15.9 15.5

Wasteforlandfillthous.oftonnes 0.5 0.3 0.3

Hazardous wastethous.oftonnes 0.6 0.5 0.7

EmployeesNumber of employeesWomen number 1,629 1,643 1,626Men number 4,452 4,466 4,275Administration, sales number 3,069 3,132 3,042Production, logistics number 3,012 2,977 2,859

Workplace-relatedacci-dents3.4 number 92 62 54Commitment index5 78 79 -

SuppliersApproved suppliers,6 per cent n.a. 88 921)Includespurchasedtransportofgoodsandbusinesstravelbyair.2) Volatile organic compounds3)Workplaceaccidentswithatleasteighthours’sicknessabsence4)DatafromourproductionplantintheNetherlandsisnotincludedinthetotalfor20185)Noemployeesurveywasconductedduring20206)Thenumberofsuppliersinoursupplierprogrammeforriskassessmentandevalua-

tion that have been approved; the remainder are awaiting audit

About this reportReport premisesThis sustainability report has been prepared in accordance with theCoreleveloftheGRIStandards.Thesustainabilityreportencompasses all principles of the UN Global Compact and describes the sustainability topics of interest to Nobia’s stakehold-ers.NobiahaspublishedGRI-basedsustainabilityreportssince2012.Thisreportreferstothe2020calendaryear.Thesustainabilityreport has not been subject to review or audit by an external party otherthanbasedonstatutoryrequirements.

BoundaryThereportencompassestheentireGroup.Specificboundariesforeachmaterialtopicarepresentedonpage119.ThecontentoftheSustainability Report and the sustainability topics presented sum-marise the sustainability initiatives of the past year and are based onamaterialityanalysis.Environmentaldataisbasedonopera-tionsinourproductionfacilitiesandownstores.

Changes to the reportData for the heating of own stores in the UK were adjusted since they are no longer limited by the threshold value that previously applied toofficialreporting;consumptionandemissionsthereforeincreasedforScope1.Duringtheyear,werefinedourinternalreportingofemis-sions from our own transportations, which resulted in a certain update ofdataforScope1.Biogenicemissionswerecorrectedandemissionsof methane and nitrous oxide are now included in Scope 1 and the remainingemissionsarereportedseparately.Market-basedelectric-itywascalculatedonresidualmix.Alladjustmentsweremadeforallreportedyears,meaning2018-2020.Minorcorrectionsofwastedatawerealsomadeforearlieryears.

CalculationsCalculations of carbon emissions from energy consumption and transportation were based on the guidelines of the Greenhouse Gas Protocol and encompasses CO2e, which means a full green-housegasimpact.Conversionfactorsforenergyconsumptionandcarbon emissions are based on data from the Swedish Environ-mentalProtectionAgencyandSwedenergy.Calculationsoninter-nal sustainability data are based on actual data from meters and invoicesasfaraspossible.Informationforelectricity,heating,busi-nesstravelandgoodstransportisbasedonsupplier-specificinfor-mation.Forfurtherinformationanddataonclimatecalculations,refertoNobia’sCDPClimateInvestorResponse2020.

The contact perform for information in the Sustainability Report is Amanda Jackson, Head of Sustainability, e-mail:[email protected]

Auditor’s report on the statutory sustainability reportTo the Annual General Meeting of Nobia AB (publ), Corp.Reg.No.556528-2752

Engagement and responsibilityThe Board of Directors is responsible for the sustainability report for2020onpages24–36,50-58and118-121,andthatithasbeenpreparedinaccordancewiththeAnnualAccountsAct.

The scope of the auditOur examination was conducted in accordance with FAR’s auditing standard RevR 12 The auditor’s opinion regarding the statutory sustain-abilityreport.Thismeansthatourexaminationofthestatutorysustain-abilityreportissubstantiallydifferentandlessinscopethananauditconducted in accordance with International Standards on Auditing andgenerallyacceptedauditingstandardsinSweden.Webelievethattheexaminationhasprovideduswithsufficientbasisforouropinion.

OpinionsAsustainabilityreporthasbeenprepared.

Stockholm,6April2021Deloitte AB

Daniel de PaulaAuthorised Public Accountant


Sustainability

Content index according to GRIStandard disclosures

PageOrganisational profile102-1 Name of the organisation 43102-2 Activities, brands, products, and services 40-42102-3 Locationofheadquarters 46102-4 Locationofoperations 38-42102-5 Ownership and legal form 46102-6 Markets served 38-42102-7 Scale of the organisation 46102-8 Information on employees and other workers 68,120102-9 Supplier chain 36102-10 Significantchangestotheorganisationandits

supply chain 120

102-11 Precautionary principle or approach 118-119102-12 External initiatives 103,

119102-13 Membership of associations 118Strategy102-14 Statement from senior decision-maker 8-9Ethics and integrity102-16 Values, principles, standards and norms of

behaviour 103, 119

102-17 Mechanisms for advice and concerns about ethics 35,55102-18 Governance structure 103,

118 Stakeholder engagement102-40 Listofstakeholdergroups 118102-41 Collective bargaining agreements 35102-42 Identifying and selecting stakeholders 118102-43 Approach to stakeholder engagement 118102-44 Key topics and concerns raised 119Reporting practice102-45 Entitiesincludedintheconsolidatedfinancial

statements120

102-46 Definingreportcontentandtopicboundaries 118-119102-47 Material topics 119102-48 Restatements of information 120102-49 Changes in reporting 120102-50 Reporting period 120102-51 Date of most recent report 120102-52 Reporting cycle 120102-53 Contact point for questions regarding the report 120102-54 Claims of reporting in accordance with the GRI

Standards120

102-55 GRI content index 121102-56 External assurance 120

Topic-specific standardsPage

FinancialEconomic performance103-1/2/3 Management Approach 201 43-49201-1 Direct economic value generated and distrib-

uted120

Anti-corruption103-1/2/3 ManagementApproach205 55,57205-1 Operations assessed for risks related to cor-

ruption 55

205-2 Communication and training about anti-cor-ruption policies and procedures

55

205-3 Confirmedincidentsofcorruptionandactionstaken

55

Page

EnvironmentMaterials 103-1/2/3 Management Approach 301 31,119301-1 Materials used by weight or volume, wood 31, 120301-2 Recycled input materials used 31Energy103-1/2/3 Management Approach 302 32,119302-1 Energy consumption within the organisation 32, 120302-3 Energy intensity 120Emissions103-1/2/3 ManagementApproach305 32, 33,

119305-1 Direct (Scope 1) GHG emissions 33, 120305-2 Energy indirect (Scope 2) GHG emissions 33, 120305-3 Other indirect (Scope 3) GHG emissions 33, 120305-4 GHG emissions intensity 33, 120305-7 Nitrogen oxides (NOX), sulphur oxides (SOX)

andothersignificantairemissions,VOC120

Effluents and waste103-1/2/3 ManagementApproach306 31,119306-2 Wastebytypeanddisposalmethod 120Regulatory compliance103-1/2/3 Management Approach 307 57,118,

119307-1 Non-compliance with environmental laws and

regulations118

Supplier Environmental Assessment103-1/2/3 ManagementApproach308 36,119308-1 New suppliers that were screened using envi-

ronmental criteria36

308-2 Negative environmental impacts in the supply chain and actions taken

32, 33, 361

SocialOccupational Health and Safety103-1/2/3 Management Approach 403 35,119403-1/2/34/5/6/7

Management Approach 35,119

403-8 Workerscoveredbyoccupationalhealthandsafety management system

34,35,119

403-9 Work-relatedinjuries 35,120Diversity and equal opportunity103-1/2/3 ManagementApproach405 34,35,

120405-1 Diversity of governance bodies and employees 34, 120Supplier Social Assessment103-1/2/3 Management Approach 414 36,119414-1 New suppliers that were screened using social

criteria36

414-2 Negative social impacts in the supply chain and actions taken

361

Customer Health and Safety103-1/2/3 ManagementApproach416 30,119416-1 Assessment of the health and safety impacts of

product and service categories 30

416-2 Incidents of non-compliance concerning the health and safety impacts of products and ser-vices

118

Marketing and labelling103-1/2/3 Management Approach 417 30,119417-1 Requirements for product and service informa-

tion and labelling30, 31

417-2 Incidents of non-compliance concerning prod-uct and service information and labelling

118

1) Our tool for supplier assessment comprises several parameters, meaning that it is currently not possible to specify the environmental or social grounds on which reviewsandauditsarebased.Forexample,adecisiontoconductanmaybetheresultofthesupplierhavingnocertifiedmanagementsystem,incombinationwithahighriskproductionprocess.

2021 Annual General Meeting

Due to coronavirus, the Board has decided that the AGM will be held without the physical attendance of shareholders, proxies or external parties, and that shareholders will have the opportunity to vote only by post prior to the AGM. Information about the resolutions made by the AGM will be published on Thursday 29 April 2021 as soon as the outcome of the postal voting has been finalised.

Right to participate at the AGMShareholders who wish to participate in the AGM by postal vote must: • firstlyberegisteredasashareholderintheshareholders’ registermaintainedbyEuroclearSwedenABasofWednesday, 21 April 2021, and

• secondly,notlaterthanWednesday28April2021registertheirparticipation by casting their postal vote in accordance with the instructions under the heading Postal voting below so that such postal vote has been received by Euroclear Sweden AB not later thanthisdate.

Nominee sharesIn order to be entitled to vote at the AGM, a shareholder whose shares are registered with a nominee must, in addition to register-ing their participation by casting their postal vote, re-register their shares in their own names so that the shareholder is recorded in the shareholders’registerbytherecorddateofWednesday21April2021.Suchre-registration(knownasvotingrightregistration)maybe temporary and can be requested from the nominee in accor-dance with the nominee’s procedures in such good time as the nom-ineedecides.Votingrightregistrationthathasbeencarriedoutbythe nominee not later than 23 April 2021 will be counted when pre-paringtheshareholders’register.

Postal votingThe Board has decided that shareholders may exercise their voting right only by postal voting in accordance with Section 22 of the Swed-ish Act on Temporary Exemptions to Facilitate the Execution of General MeetingsinCompaniesandAssociations(2020:198).Aspecialformistobeusedforpostalvoting.ThispostalvotingformisavailableonNobia’swebsitehttps://www.nobia.com/agm2021.Acompletedandsignedpostal voting form may be sent by post to Nobia AB, “Årsstämma”, c/o EuroclearSweden,Box191,SE-10123Stockholm,Swedenorbye-mailtoGeneralMeetingService@euroclear.com.ThecompletedformmusthavebeenreceivedbyEuroclearnotlaterthanWednesday28April2021.Shareholderswhoarenaturalpersonsmayalsocasttheirpostalvoteelectronically,usingtheirBankIDasverification,viaEuroclearSwedenAB’swebsitehttps://anmalan.vpc.se/EuroclearProxy.SuchelectronicvotesmusthavebeencastnotlaterthanWednesday28April2021.

Shareholdersmaynotaddspecificinstructionsofconditionstotheirpostalvote.Theentirepostalvotewillbeconsideredinvalidifthishappens.Additionalinstructionsandconditionsareavailableonthepostalvotingformandathttps://anmalan.vpc.se/EuroclearProxy.

Shareholders’ right to receive information The Board of Directors and the President shall, if a shareholder so requests and the Board believes that it can be disclosed with-outanysignificantharmtoNobia,provideinformationaboutcir-cumstancesthatcouldaffecttheassessmentofamatterontheagendaandcircumstancesthatcouldaffecttheassessmentofNobia’soritssubsidiariesfinancialsituationsandNobia’srelation-shipwithanotherGroupcompany.

A request for such information is to be submitted in writing to Nobia notlaterthantendayspriortotheAGM,thatis,Monday19April2021,toNobiaAB(publ),Blekholmstorget30,SE-11164Stockholm,Swedenorbye-mailtobolagsstamma@nobia.com.TheinformationwillbemadeavailableonNobia’swebsitehttp://www.nobia.com/agm2021notlaterthanFriday23April2021.TheinformationwillalsobemadeavailableatNobia’sheadofficeinStockholm,Blekholmstorget30,onthesameday.Theinformationwillalsobesenttoshareholderswhohaverequesteditandprovidedtheiraddress.

DividendFor2020,theBoardproposesadividendofSEK2pershare.Thediv-idend proposal entails a total share dividend of approximately SEK338m.Therecorddatefortherighttodividendis3May2021and last day for trading in Nobia shares including the right to receivedividendisApril29,2021.IftheAnnualGeneralMeetingresolves in accordance with the board's proposal, the dividend is expected to be paid through Euroclear Sweden AB on Thursday, May6,2021.

Annual ReportThe Nobia Annual Report is published in Swedish and English, and both versions are available for download from the company’s web-site.TheSwedishversionoftheAnnualReportisprintedandsenttoshareholders by mail, and to other individuals who have requested suchaversion.

Financial informationNobia’s objective is to facilitate the valuation of the company by thestockmarketthroughclearinformation.Theprovisionofinfor-mationisbasedmainlyonquarterlyfinancialreporting,pressreleases, information on the website, company presentations and meetingswithshareholders,analystsandinvestors.

Financial calendar 202128April InterimreportJanuary-March2021.19July InterimreportJanuary-June2021.26October InterimreportJanuary-September2021. TheAnnualGeneralMeetingwillbeheldon29April.


2020 Annual General Meeting

Nobia Annual- and Sustainability Report 2020 is producedincooperationwithSpringtime-Intellecta. Photo:HelénKarlsson,NobiaandShutterstock.

Print: Taberg Media Group, Stockholm 2021

Nobia

Annual and Sustainability Report 2020

Nobia AB Street and postal address: Blekholmstorget 30ESE-11164Stockholm,Sweden.Tel+4684401600,[email protected],www.nobia.com

Bribus B.V.Industriestraat 4NL-7091DCDinxperlo, The NetherlandsTel:+31315651745www.bribus.nl

Commodore KitchensAcom HouseGumley RoadGrays, EssexRM20 4XP UKTel.+441375382323commodorekitchens.co.uk

EWE Küchen GmbHDieselstraße 14A-4600WelsAustriaTel.+4372422370ewe.atintuo-kitchen.com

FM Küchen GmbHGalgenau 30A-4240 FreistadtAustriaTel.+4379427010fm-kuechen.at

Gower Furniture LtdHolmfieldIndustrialEstateHalifax,WestYorkshireHX29TNUKTel.+441422232200gower-furniture.co.uk

Magnet Ltd 3AllingtonWayYarm Road Business ParkDarlington, Co DurhamDL14XTUKTel.+441325469441magnet.co.ukmagnettrade.co.uk

Nobia Denmark A/SIndustrivej6DK-6870ØlgodDenmarkTel.+4575244777hth.dkinvita.dk

Nobia Svenska Kök AB Mossebogatan6Box603SE-52281TidaholmSwedenTel.+4650217000marbodal.se

Novart OyKouvolantie225Box 10FI-15561NastolaFinlandTel.+358207730730novart.fipetrakeittiot.fialacartekeittiot.fikeittiomaailma.fi

Nobia Norway A/STrollåsveien6Postboks633NO-1411 KolbotnNorwayTel.+4766822300sigdal.comnorema.no

uno formFabriksvej 7DK-9640FarsøDenmarkTel.+4598632944unoform.com

annual and sustainability report 2020 - nobia

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