IAR Systems Group AB (publ) Interim Report Jan-Sept 2013

Highest profit of all time

Operating margin excluding insurance claim of 20.8%

July - September 2013

• Net sales of SEK 54.9m (56.2)
• Operating profit of SEK 15.4m (10.1)
• Profit before tax of SEK 15.2m (9.7)
• Operating margin of 28.1% (18.0). Excluding the effects of an insurance claim (see details below), operating margin was 20.8%
• A stronger Swedish krona in 2013 compared to 2012 had a negative year-on-year impact of SEK 4.2m on sales and SEK 2.1m on operating profit

January - September 2013

• Net sales of SEK 168.7m (170.6)
• Operating profit of SEK 31.2m (25.4)
• Profit before tax of SEK 31.1m (25.0)
• Cash flow from operating activities of SEK 30.7m (23.1)
• Net cash at the end of the quarter was SEK
  54.7m (45.0)
• Operating margin of 18.5% (14.9).
  Excluding the effects of an insurance claim (see details below), operating margin was 16.1%
• Earnings per share before dilution and after
  current tax amounted to SEK 2.45 (1.96)
• Earnings per share amounted to SEK 2.02 (1.65) before dilution and SEK 1.86 (1.52) after dilution
• A stronger Swedish krona in 2013 compared to 2012 had a negative year-on-year impact of SEK 11.6m on sales and SEK 6.5m on operating profit

Key events during the period

• Launch of certified version of IAR Embedded
  Workbench for ARM processors
  • Launch of the debug probe I-scope
  • Charges have been filed against the former CEO of the American subsidiary due to financial irregularities. The insurance compensation for previously arising damages has had a positive net impact on earnings for 2013 of approximately SEK 4 million. See details under financial information.
  • Sale of 334,600 treasury shares in September for a combined value of SEK 12.3m