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Good morning, everybody, and welcome to this session where we're going to present Nederman Group Q4 2020 statement. Let's start with the statement. We have had a very healthy operating margin and strong cash flow despite very challenging environment with renewed lockdowns around the world, political uncertainty in U.S. and protracted Brexit negotiations. On the positive side, the lockdowns had increased the interest for our digital solutions and our Insight control, smart filters and so on. And we can happily now say that the fairly new MCT division is a valuable part of the group, exceeding SEK 0.5 billion in sales with good profitability.
If I move on to Slide 3 and talk through some of the financials before Sven gives some more details on what's happening in the 4 divisions. If we take the financials for Q4, first of all, orders for the quarter were SEK 918 million, which is obviously higher than Q3 in 2020, but it's a currency-neutral decrease of 17% versus the fourth quarter of 2019. Sales were SEK 940 million in the quarter and, however, -- which is lower than last year, 10.4% currency-neutral down. However, operating profit was at SEK 94 million, which is 10% versus 10.4% last year. We see the effects of our cost control meant that we've been able to keep the margins in percentage terms, at least up. Net profit for the quarter, SEK 55.1 million, which is earnings per share of SEK 1.57 versus SEK 2.06 for Q4 2019. If we look at the full year financials on Slide 4. Orders for the full year were SEK 3.48 billion, not million as I see that it says in this presentation versus SEK 4.16 billion in 2019. That's a currency-neutral decrease of almost 14%. Sales were approaching SEK 3.7 billion versus SEK 4.3 billion last year. Sorry, in 2019, which is a decrease of almost 12%. Adjusted operating profit for 2020 was SEK 296 million versus SEK 349 million in the prior year. The margin for -- the operating margin for the full year was 8% versus 8.1% in 2019. Again, we see the impact of the cost control measures that we have taken throughout the year. And our work on operational efficiency has helped with margins. Net profit for the full year was SEK 110 million. Earnings per share, SEK 3.15. Regarding dividend, due to the continued high uncertainty, the Board is -- the current proposal is that no dividend be paid right now. The intention with this is to maintain financial stability, also increasing flexibility for new opportunities that may arise. The Board will evaluate this situation continually and further statement regarding dividends will be made during this year. And absolutely, at the latest, in the release of the Q3 report on the 22nd of October. Moving on to Slide 5. Now this -- the Extraction & Filtration Technology division, Sven.
Yes. Extraction & Filtration Technology is the traditional Nederman branded product working with typically welding, wood, composite, et cetera. The key activities has to be to finalize the optimization of the operation and logistics, especially in EMEA, but also some work has been done in the Chinese area. And this means that we have a very good efficiency in our main plants in Poland and in Helsingborg. We have continued efforts to modernize and digitize the product range. This has very much been in cooperation with the Monitoring & Control Technology division. And we can now say that a large portion of the stationary filters are going out with Insight Ready modules, which we call the smart filters. And not later by 2023, all filters sold, stationary filters sold, will be Insight Ready. So they can be linked to IT solutions with the proper control system. The division has been very early on in handling the cost control issues with the lockdown starting already in the spring, and we have followed up that and have, by that, been able to protect our profitability. The main challenge for Extraction & Filtration division has been the lockdown, especially in Europe, partly in Americas and in Asia. We can come back to certain areas like India has been basically closed for 8 months where you were not allowed to have more than 10% people in at the same time, et cetera, et cetera. But you all know about these things. During the quarter, Germany had order intake, which was positive. There was sort of a buildup of demand after the lockdowns. Now they have new lockdown. So let's see. Certain decline in Nordic countries, especially difficulties in Norway and so on. U.K. completely locked out with the Brexit, but we have been able to maintain the delivery capacity because we have several years to plan for it because it was a long painful process before we finally got done.In France, we had a breakthrough order for the wind power industry in southern parts of France, and we are glad for that. And we will handle that with technology support from Nordic countries. In Spain, came back and they were in line with last year, whereas Belgium and the Netherlands has been very impacted by lockdown. Poland, however, has had good growth in many areas, both with the -- both in food and in composite manufacturing as well as traditional wood, which is strong in Poland. The distributor markets grew compared to last year, which was positive. India had a very strong Q4, but as we've said, it was lined up for that when they finally opened after many months of complete lockdowns. Wind power has been and still is an important area for us there. Thailand, solid growth. Other APAC country, a mixed picture. North America, we were slightly behind a very strong Q4, but we had some good orders. Brazil, where they have had less lockdowns compared to other places, we have a continuing strong trend.
If I talk through the financials for Extraction & Filtration technology. In quarter 4, order intake was SEK 450 million versus SEK 512 million in Q4 2019. That's a decrease of 8%. Sales was SEK 437 million currently in the quarter that we see -- we actually build -- managed to build a little backlog in that division. Adjusted EBITA SEK 65.6 million gives a margin of 15%, which is actually ahead of the Q4 2019 of 14.9%, and this is despite negative currency impacts that are particularly -- do have a bigger impact on this division than the others. For the full year, sales SEK 1.65 billion versus SEK 1.94 billion in 2019 is a decrease of almost 12% or currency-neutral. EBITA SEK 222 million versus SEK 263 million in 2019, there was a margin of 13.4%, so almost in line with the 13.6% they had in a very good 2019 with obviously significantly -- market conditions were obviously significantly more favorable. Moving on to the next division is Process Technology and back over to you, Sven, Slide 6 now.
Process Technology is here where we have mainly large installations, including the processes, which is foundries, smelters, metal recovery and fiber manufacturing textile side of it. The key activities is the ongoing digitalization of the product range same as for the other division, where together with MCT division, they gradually add more and more features and capabilities in these. 28 of the large installations made last year were completely fitted with what is called then Mikropul-Assist, which gives all data online in the cloud-based services. And we are continuing to build the capabilities, giving more features to the customers, which mean that we can claim that we are future-proof supplier in this field. Very important to continue with that. Focus on strengthening orders received, obviously. This is the division that has been hardest hit by the hesitancy, the lockdowns and the restrictions. And thereby, jumpy investors, we come to the textile segment later. Securing profitability in the short and long term. We are very glad that due to the activities made, we've been able to be profitable, which is not all competitors that can say that in this very challenging market condition for this division. Some brightening, if we say for the quarter, is pricing and the marketing can be seen. We see that target that was halted early in the spring are now sort of gradually coming alive. We have also, with the cost control mentioned earlier where we cut the expenses well over 20%, and that gives us the maneuverability. Taking to segment, Textile, we have to realize that for a period of 7 to 8 months last year, 65% almost of all textile fiber-based industries were completely closed down, more or less completely closed down, and that does not give a good incentive for further investment. We now see, and we have this side of new year, these landed some orders. So it starts to roll again. The Indian market, especially, is important in this case, and they have been, as mentioned before, with an enormous strong lockdown, very affected. China remains a bit difficult. They have been reduced, and that has also to do with the trade war between China and U.S., where now a lot of that industry is moving to other countries like Vietnam, Cambodia, et cetera. The monitoring solutions are growing, and it's part of the standard range. We will further link that to the inside solutions and the measurement and monitoring systems that will further enhance and make it even more attractive with new features as we continue to develop that capability. If we go to foundry, smelters, the European market has signs of recovery, metal recycling. Generally speaking, it's not a lot of new other trends, but one trend is recycling could be and should be an interesting area. Service operations continue only with the practicalities that you are not allowed to site, and that has been a problem. We are seeing that as a continuous issue and, again, the only positive we can see -- say about that is that there's a growing interest for the remote monitoring that we are supplying for Digi 7 within the textile with the Mikropul-Assist with the combination of sensors, IT solutions sending to the cloud, being able also to solve some of the issues over phone and over the web. Over to you.
Financials for Process Technology division. Orders received for the fourth quarter were SEK 248 million. That's a significant drop from an extremely strong quarter 4 of 2019. It must be pointed out, the drop is approximately 43% currency-neutral. Sales for the quarter were SEK 262 million versus SEK 360 million in 2019. Adjusted EBITA for Q4 2020 was SEK 9.1 million, which is -- which, like Sven said, is positive, which compared to some competitors, we suspect to having large issues there. But the SEK 9.1 million gives us an EBITA margin of 3.5% versus 7% last year. If we take the full year order intake for process technology, SEK 993 million versus SEK 1.462 billion in 2019, is a drop of 30%. Sales, SEK 1.137 billion, giving an EBITA of SEK 58.1 million, which is an EBITA margin of 5.1% versus 6.2% in the prior year. If we move forward on to Slide 7, we'll talk about Duct & Filter technology.
Yes. Duct & Filter technology, we are supplying special duct for systems with high duct loads, and we also supply filter elements to the filters. The key activities has been the decision and ordering of a fully-automated pipe welding system for the European market. It will be placed in our factory in Assens, [ a new plant ] Denmark, and it's an important further step to increase our capabilities, both when it comes to longer pipe and efficiency. So we are looking forward to continue to grow the European business the same way as we've been able to do in the Americas and partly in Asia, and we will also revise investment in the Asian business later during the year. We have launched webshop, again, digitalization, make-it-easy. They have a slogan in this division, "fast, friendly and reliable." And now launching the webshop, starting with U.S. and will roll it out in other areas. We have launched new system product for the food industry as an important part of this. The development in the quarter was positive in most markets. But again, the renewed lockdowns in Europe had some negative impact there. Nordfab, under the brand name that we sell the pipe, we grew orders both versus last year's Q4 and also continue the good trend. We had a better order intake than Q3 and a growing number of digital orders, the webshop and EDI and so on, so we continue digitalization, not our with IoT solution, but also in the normal operations. In Europe, we had some negatives that can. We blame it on the lockdowns. And -- but we grew versus the Q3 2020. So that's still a positive trend. And again, the Thailand plant is working very well. Yes, we have for the Menardi, with filter, we have increased opportunities and some of the earlier postponed orders are now materializing again. Again, it starts to move and starts to roll again.
Onto the financials of Duct & Filter technology, order intake for quarter 4 was SEK 101 million versus SEK 89 million last year, which is a 15% currency-neutral growth. Sales was slightly -- it was 100 -- slightly higher than order intake, 105 -- SEK 106 million, which is 8% down from last year; however, due to better efficiency mainly we could say, in operations, but also good cost control. Our EBITA was SEK 20.8 million versus SEK 8.3 million in Q4 last year, and that's an EBITA margin of 19.7% for the fourth quarter. For the full year, order intake was SEK 403 million, which is 12.8% behind the full year 2019. Sales was SEK 458 million. That's approximately 16% down versus last year. EBITA, SEK 64 million versus SEK 69.6 million in 2019 is an EBITA margin for the full year of 14% versus 12.5% last year. So we see that the operation -- the overall division is operating in a more efficient manner now.
And I think it's worth to mention that Duct & Filter technology is normally the early warning. They are moving much faster than the other divisions when it comes to if you see change. So it's a little bit a positive sign that they had a good Q4.
Absolutely. Moving on to Monitoring & Control Technology, Slide 8 now, Sven.
Yes. Monitoring & Control is where we have our IoT solutions with the Insight -- Nederman Insight. We have our measurement control for gases, particles and we have that fairly new. As you know, it's been from our own development as well as the acquisition of specialist companies that are technology leaders in their field. Key activities has been to launch new functionality in the Insight, improving flexibility and use of friendliness for the platform. And we have now a very strong platform that can continue to deliver new functionalities in a easier way and gives it more -- create more attractiveness for the user. We have established business towards the process industry in the U.S., and that is progressing. U.S. has been -- besides AFS, the Boston-based company, has been a weak spot for the other European-based companies. We further focus on digitalization of all key processes. Development in the quarter, the trend for product as a service among divisions and customers was very positive through developing Asia, though the development in Asia was affected to some extent by travel restrictions. Some of the activities and growth initiatives we had planned or had planned during the years has been hampered by the fact that we have not been able to send people. We have not -- the travel restrictions had slowed us down. The EMEA orders declined somewhat compared to Q3 2020. Again, large valuations. But emission-related sales are generally less negatively affected than process control, meaning, what will mean that, that process control is the ones that are in the process and more linked to new investment. APAC orders were also slightly behind the Q3 2020, but the emission-related sales were relatively strong. Sales in Americas increased significantly compared to Q3 and also Q4 last year. We are now able to go-to-market directly with our process-oriented product and services, and that has been well received. We have also increased our capability with local or regional, I would say, based service technicians, which is also giving us some good result.
Moving on to the financials for Monitoring & Control Technology. What we must remember when looking at the financials for this division, particularly in Q4, is that we owned Gasmet in 2019 for only a short portion of the year. The acquisition was completed just after the turn of December. But if we take our incoming orders for the division, SEK 118.4 million in the fourth quarter with a currency-neutral growth of 30%. Sales of SEK 152.1 million in the quarter, is a good quarter for them there versus SEK 114.6 million last year. That's currency-neutral growth of 37.6%. Adjusted EBITA for the quarter 34.1% versus what was a very strong Q4 last year as well as SEK 32.6 million. EBITA margin now for that division in Q4 was 22.4%. And if you move on to the full year for this division, order intake, just shy of SEK 0.5 billion, SEK 496 million. Sales just over SEK 0.5 billion at SEK 507 million. That's a growth of 87%, which we're obviously pleased with. Adjusted EBITA SEK 94.6 million for the full year 2020 versus SEK 44.6 million last -- in 2019, excuse me. The margin -- EBITA margin for a full year now 18.7% versus 15.9% in 2019. Move on to Slide 9 and look at the regional development. I will spare you the pain of reading out all of the numbers on this slide. But I think the most important takeaway we should have from this, and it's true for both the quarter and for the full year is that you see the delta -- the drop versus 2019 is most significant in EMEA, where we have seen the heaviest lockdowns and the most prolonged lockdowns. Americas and APAC have seen a decline in both Q4 and in the full year, but not by as much as we have seen in Europe, like I say, where we have seen these lockdown restrictions, which impact both investment decision-making in terms of -- particularly in terms of larger projects, but also at least hampered to some extent, the service business in terms of accessibility and so on. I move on to Slide 10 and look at the cash flow from operations. We see a somewhat more steady development throughout the whole of 2020 versus 2019, but we still see this very strong fourth quarter of the year, I mean even in 2020. And cash flow for the full year from operations in 2020 actually exceeded that of 2019, which we are obviously, very pleased with. This is something we've worked extremely closely within these tough financial times is to ensure that our operating working capital is utilized efficiently. I then move on to Slide 11, means that you see a drop in net debt in the fourth quarter of the year, we've seen a steady reduction in debt from the Q1 onwards. The majority of that change is due to the good working capital development and cash flow performance. If we move on to the Slide 12, a little summary of Q4. I'll let you, Sven, take the short...
Yes. Let's have a very short summary of the last quarter of last year. Extraction & Filtration Technology, the lockdowns, especially, in Europe have had a major impact. We have seen growth in APAC. And despite all the difficulties, a healthy profitability. Process Technology have seen continued postponed investment decision though we can see now early in this year that there are some positive signs in some areas more than others. The good cost control have given continued profitability. Duct & Filter Technology, growing order intake, increased production efficiency and thereby, better profitability. Monitoring & Control Technology, strong sales and high profitability. Continuous improvement in Nederman's digital product range continue here. And we continue to spend time, money and efforts to stay ahead in this game, and we see more and more interest in these solutions. So for the group: profit margins, good; strong cash flow; however, still mixed signals from the market with some positive signs. But the lockdown impact is still apparent, and we are waiting to see what happens during the coming months.
Finally, on to the outlook on Page 13.
Yes, the outlook continued extreme uncertainty regarding the development of the global economy. For the first quarter of the year, Nederman expects the effect of COVID-19 pandemic to remain significant in most of the group markets. The vaccination programs that are now being initiated throughout the world had the expected effect on the global spread of infection. We anticipate a cautious recovery in the second half of 2021. Accordingly, it's currently not possible to provide detailed forecast of developments in coming quarters. However, during 2020, Nederman conducted a series of measures to maintain healthy profitability and the effects of these measures should continue to be seen. We still see good opportunities to further advance our position, not least by launching new products and continuing the development of our digital offering. The problems with poor air quality in the world remains extensive, leading to a larger number people dying prematurely every year and the underlying need for Nederman's products is significant.
The final slide on financial. The financial calendar, we will release the figures for our Q1 on the 22nd of April 2021, the AGM is 4 days later on April 26. January to June, Q2, is released on July 15. And the Q3 report is released on the 22nd of October. With that, I think we can open up for questions.
[Operator Instructions] We have a question from the line of Marcela Klang from Handelsbanken.
Obviously, the pandemic is affecting many companies, and you also gave a very good overview of the outlook, what you can see right now. Do you have any feeling how your competitors are managing or how your customers are managing? Are there any potential structural opportunities for view appealing for future M&A or something like that?
Yes, difficult to answer in politically correct way. But we have never had so many requests and inflow of...
But you can say that my -- exactly, my inbox is receiving more teasers from companies than for a very long, probably ever. So they are coming in thick and fast at the moment and they are being evaluated. Some may be cash flow issues, and others see the opportunity maybe to divest certain parts of their business.
I'll add one thing just staying more on that. It's always -- we are always looking, you know that, we are evaluating all the time. Let's see what comes out of this. We are, obviously, also focusing our interest in what will give synergies with the investments made and having special interest in continue to grow the new technologies we have in the MCT division.
You mentioned a lot of modernization and digitalization activities for 2021. What else are you focusing on in this year maybe on a group level in terms of further cost actions, adjusting capacity or what are you focusing on near term?
Well, I can make an attempt at answering that. In terms of the cost-cutting that we did in 2020, we don't see right now -- as long as there's not a significant change or a significant further drop in the market, we don't see that those activities will need to be repeated. We will need further to do more there. Obviously, we're working on a sort of a one foot on the gas, one foot on the brake here. And if things are -- as we see the market opening up, again, the investment decisions coming in and such, then we will look to obviously to take those opportunities. And if that requires more investment in personnel or whatever in terms of operations, we will make those changes. But we don't see that there's a need for further costs now. We did -- we see on the level of revenue that we had in the fourth quarter, we still managed to achieve a 10% EBIT. And, okay, the absolute numbers in Swedish krona are not as high as we would like to see, but we're quite happy with the margins that we have right now, at least.
Of course. And then obviously, a follow-up question, is this cost level sustainable once we start opening up and traveling more and spending more?
What I can say to that is we don't see in the short-term that we should need to accelerate costs at the same speed as sales would increase. So the cost level is, to some extent, sustainable. Of course, you can't grow forever without increasing your expenditure. But the growth, we would see -- we would expect the growth in sales to help outrun the growth in expenses, at least in the short-term.
Maybe to add, what we are doing is that there are significant players and, since some companies are belly up at the moment in, we have taken the opportunity to add-on and exchange some senior persons, especially in sales and market development around the world where we felt that, that is an opportunity. So that we add. And once we added, we continue to develop our product. We are launching new products continuously now and we will during -- later in the quarter as well, new features, also including -- maybe in April, including Gasmet for the Insight control, so they can start doing remote services on their equipment, et cetera. So that's a continuing effort. So we have not halted our development when it comes to these. Then we -- when you talk about digitalization, it's not only the IoT solution that is feeding digitalization, we are trying to be as modern as possible with new quotation tools, modernizing. We will have a completely new quotation tool, web-based for the ducting systems here late March, early April, which enables the installer to basically do the drawing -- from a drawing just make a bill of material coming out with us. And that's instead of a 3, 4, 5-hour exercise, maybe an hour's exercise. These type of efficiencies, again, "fast, friendly, reliable", that is investment when we talked about digitalization, not only IoT, not only remote control. But we try to be, as we say, future-proof for our customers going forward.
Understood. In terms of capacity utilization, what level are you at right now?
Low.
Less than 40%, 50%?
This depends on how you're calculating. If you extend to shifts, then, of course. But when it comes to the manufacturing side, we can increase I would say easily 20%.
Absolutely.
Yes. And that also basically helps with keeping the costs down in the first phase of the opening up and recovering. Which segments do you expect to be the first ones for you to open up, given the latest signals you are receiving? Where the need is -- the underlying need is the strongest and investors are ready?
That's not the same thing because the need is very strong when it comes to recycling of material, but it's longer process and it's bigger investments. I think that there is a growing interest, if you look at the recycling, whether that is recycling of waste into energy or recycling of metals or other recycling. That long-term trend we believe would be very strong. But again, this is long cycles and we've seen with the heavy investments needed, this is also depending on the regulations and so on. So that -- I think that, in short term, you will see in the engineering sector, the fastest fallback in the EFT when it comes to when they start producing again. We will probably see a service upturn and so on in a number of areas in especially textile that has been so pushed back there, there will be a need to start it again. When it comes to the -- where I believe there will be a continuous demand is, the measurement control because the way we have been working over the last year, there is a growing interest in understanding that things can be sold over the web, even if they're not used to do it that way. So I think that, that will come back. And it's also so if you really want to control your emissions, you need to understand and measure it. So I think that could be a bounce back fairly quickly. If we open up for it and it happens, and you can see the regulators in China, especially on now pushing for measurement and we are in the front line of capabilities when it comes to monitoring, diet science, et cetera. And we've seen that the drawback is that we haven't been able to travel, we have been able to visit and show and set up the structures and limitation also with installation. So it was a long answer, but it's very difficult to say because it's going to be depending also on what the industries get back to business at first. But as you see here, Nordfab will deduct, that's installation. It's a number of installation that's been held back because they haven't been able to assess sites. There's been slowdowns, lockdown. There, they have seen a recovery last quarter. Next division probably to follow is EFT and MCT and the team. And then the one that will take some time, probably, is Process Technology. But you don't know. If someone decides, then, of course, you take -- but the process of getting it through takes several months.
And maybe a final question for me. Do you also see any of these subsidies, the green deal programs, affecting you directly or indirectly and supporting demand for your products?
Not in the short term, potentially long term. The green subsidies is very much being focused also on green gas emissions in the sense, for some reason, whereas we have -- which is a bit dubious when you see that The Guardian last week publicized a new, we have said and know that before, a new report that 8.7 million -- minimum 8.7 million annual deaths in 2018 could be attributed to bad air quality. And China, themselves said that at least 12% of all deaths in China are related to bad air. So again...
What we can say on this is that not directly in the short-term because of what Sven says, a lot of this is actions that are focused on CO2 emissions. However, they should drive new investments regardless of what they are, which are beneficial from their demand. And we see -- and we have a feeling that there's a lot of discussions on what is green and what is not at the moment. If you take the Swedish forestry industry and things like that, they're lobbying very hard. So we suspect that there will be changes to the system and what is -- what investments come in. And that will further benefit Nederman going forward.
So in the mid-, long-term, definitely, it will have an impact. And the awareness, we'll try, is growing.
Yes. True. True. So a lot of opportunities and, hopefully, the vaccination programs throughout the world don't get hit by further delays. And we all can start returning back to normal towards the middle of this year. And that was my questions.
[Operator Instructions] We have a question from the line of Herman Eriksson from Handelsbanken.
Yes. So my colleague, Marcela, covered most of our questions. So I just have 1 more question here. So looking at the orders and looking back at 2020, to what degree should we just see the lost business during the year, as simply postponed and to what degree as lost business?
How to answer that, what we have this discussion a lot. The one thing that we should point out is that we don't feel that we have lost market share. Probably on the contrary, but it's a very difficult science to get there. Then to breakdown what is lost and what is delayed that's quite a difficult one. On Process Technology, the majority, I would say, is delayed. We still see that -- we don't see projects canceled, but the willingness to make the final decisions or even the practical ability to finalize projects is severely hampered, and that's not a good thing. Sven, I don't know, maybe you want to say...
No, I think, you covered it. It's not that projects are closed, but it can take some time before they have financials or willingness to do it. We have to realize in a number of cases, we are just a small portion of the investments.
There are no further questions at this time. Please go ahead, speakers.
So if there's no further questions, we thank you for taking the time listening to us, and we'll meet again, we hope, in April. Thank you very much.