Everyone, this is Magnus Dalhammar, Head of Investor Relations at Investor. I would like to wish you all welcome to our Q2 2019 presentation. This will be made by Johan Forssell, our CEO, and Helena Saxon, our CFO. As always, after the presentation, there will be an opportunity for Q&A. With that, over to you, Johan.
Thank you, Magnus. I think since it is summer, we'll kick straight into the presentation material and the summary page. As you have seen that it has been a stable and good quarter. Our adjusted net asset value was up 6%. Our total share return was up 9%, compared to the stock market, +7%. The listed portfolio was up 6%. We made a SEK 2 billion investment in ABB during the quarter. Within Patricia, we had a 6% value increase. Aleris was divested after the end of the quarter. We have made significant exits within financial investments. I will come back to that. If we look on the major subsidiaries, sales growth was +10%, of which 2% was organic in constant currency. The profit was up 15%. If I should make a few comments on these figures, Aleris has, as you know now, been divested.
If we exclude Aleris, the organic sales growth in constant currency was 4%. If we exclude Aleris and Laborie, since last year, Laborie took significant restructuring costs, both these companies. If you adjust for both Laborie and Aleris, the operating profit increased by 7%. EQT had a very good development, up 8% in constant currency. As we previously have announced, we increased our ownership to 23%. Finally, we have a strong balance sheet with a leverage of 5.5%. In addition to that, of course, we have done significant exits. The proceeds are not included in the cash balance as of June 30. With that summary, let's move down over to the divestment of Aleris. On July 12, we announced that we are divesting the company for an enterprise value of SEK 2.8 billion.
Adjusting them for the net debt and also some transaction cost, the equity will be about SEK 2 billion. We expect the deal to close during the third quarter. This capital that we will free up will be used to build and develop the strong platforms within Patricia Industries. Moving down to slide number four on financial investment. I think we, in a very good way, are executing on the strategy to maximize the value for the financial investments. In the quarter, we have divested Trilliant. That is in the cash position as of June 30. Divestments not included in our cash position as of the end of the second quarter include NS Focus and Memira, that was divested after the end of the quarter. Finally, WhiteHat Security, that is a U.S. company that also was divested after the end of the quarter.
The expected proceeds from recent exits within financial investments, not included in our cash position as of June 30, exceed SEK 2 billion. Combined with the announced divestment of Aleris, our investment capacity is significantly strengthened, and equally important, this divestment result in a more focused portfolio. Moving over to Mölnlycke. The organic sales growth was 5% in constant currency. Good to see now we have been in three quarters in a row at that level. All geographies contributed similarly to the overall absolute growth. This means that the emerging markets grew just about 20% and that we had a higher growth in the U.S. compared to Europe. The EBIT margin stayed at healthy level but was impacted by the investment in sales and marketing. Due to the strong cash flow generation, EUR 175 million was distributed.
If we look on the different segments, the growth was 7% in Wound Care, and the Wound Care business was mainly driven by the U.S. and growth markets. The focus here remains to really get good traction behind all the new product launches. It's continued work, and we are seeing good traction in the market for the new products. On the surgical side, it was up 4%, and that was mainly driven by the U.S. and Europe. Within the different product categories, gloves and surgical trays were the main drivers. Moving down to Permobil. The organic sales was down 3% in constant currency. Power and seating and positioning declined, while manual actually grew in the quarter. Regionally, APAC reported strong growth. It was actually up double digits in the quarter.
The EBIT margin improved, driven by both different initiatives to control cost, but also production efficiency improvements, and there was also a positive currency effect. Also, SEK 120 million was distributed, of which the majority is, of course, to Patricia. The work is continuing to consolidate the manufacturing footprint and reduce complexity, basically closing down some smaller units. Following the introduction in the first quarter of the new F6, that's the front-wheel drive, it was launched globally during the second quarter. Moving to Laborie. The organic sales growth was 1% in constant currency. We saw modest growth in urology, but we saw a slight decline in gastrointestinal segment. We should remember when we look on the figures that the revenue in the second quarter 2018 was boosted by shipments that were delayed from the first quarter of 2018. It's a strong comparable period.
The development of the business is developing nicely. Profitability continued to improve in line with our plans, driven by cost savings materializing from the Cogentix acquisition, also that we now have gotten good traction from the European restructuring. Moving over to Piab. Piab, you see that the organic sales growth was actually -3% in the quarter, that is mainly driven by the robotic gripping division that is affected by the weak automotive market. Also internal measures are affecting the growth. We are reorganizing the sales channel for this product line. Despite the lower revenues, the underlying profitability improved slightly. Clas Gunneberg has been appointed new CEO, and he will start in September. Moving to BraunAbility, organic growth of 3%. This quarter, the growth was driven by lifts and the commercial side, while the consumer bug business was roughly unchanged in the quarter.
The profit margin was supported by operating efficiency improvements and also the supply chain work that we have been done now for quite some time. The company made an acquisition of a small dealer. It's not a huge one. It's in the range of 1%-2% of sales of the total company. Sarnova had a very good growth, grew organically 8% in constant currency. At this quarter, acute care grew faster than emergency preparedness business. In this company, we are investing quite heavily in sales resources, also improving the digital setup, and finally, warehouse optimization. Sarnova did a small acquisition in the quarter, also here, roughly 1%-2% of sales to give an order of magnitude. Three had a good development. Subscription base was up 42,000. If we adjust for the VAT ruling, the underlying service revenue was up 6%.
If we adjust for the VAT, but also for IFRS 16, that is boosting the reporting profit, the underlying profit was up 6% in the quarter. The company distributed SEK 300 million, of which SEK 120 million went to Patricia. Moving then over to EQT. It's a very strong development with a value increase of 8% in constant currency. As we previously announced, we now own 23% in the company, but the total exposure to EQT is essentially unchanged. In the quarter, we had a negative cash flow of about SEK 600 million, but that negative part of it is entirely explained by transactions related to the simplification of the ownership structure of the company. As of today, the value of all our investments into EQT has a value of SEK 24 billion. That was my overall summary, and with that, I hand over to Helena.
Thank you, Johan. Looking at page 14, we see on the 10-year net asset value development graph that adjusted net asset value reached SEK 422 billion at the end of the quarter, while the reported net asset value was SEK 366 billion. Turning to the next page, looking at the listed companies, a portfolio valued at SEK 310 billion. The contribution in the quarter was SEK 17 billion, and the total shareholder return 6%, just shy of SIXRX 7%. Atlas Copco was the company that contributed the most, while Wärtsilä and Sobi had a tougher quarter. Turning the page to Patricia Industries sequential development of estimated market values, we can see that the development was very positive. While Laborie and Mölnlycke were the main drivers of this value increase, all subsidiaries contributed to the value growth in the quarter, and distribution to Patricia amounted to SEK 2.2 billion.
Looking at the next page, more specifically at the value drivers, we see that Laborie market value increased SEK 1.2 billion in the quarter, and this due to sharp increase in profit and higher multiples. Mölnlycke's estimated market value increased by SEK 1.1 billion due to strong cash flow, higher multiples, and FX. Mölnlycke was also the company that distributed a significant amount, SEK 1.8 billion in the quarter. BraunAbility's estimated market value increased by SEK 0.9 billion due to higher profits and multiples. Permobil increased its estimated market value by SEK half a billion, and this was due to higher profits, cash flow, and multiples. The company also distributed money to Patricia in the quarter. Three, the estimated market value increased by SEK 0.4 billion due to higher multiples, and there was also a small distribution of SEK 120 million in the quarter. Looking at the next page, financial investments.
Johan already mentioned that Patricia Industries is executing on its strategy for financial investments. NS Focus and Trilliant were sold in Q2. Memira and WhiteHat Security were both divested after the end of the quarter, now in July. The five largest financial investments now amount to SEK 2.4 billion. Finally, our financial position on the next page. Our financial position remains strong with leverage of 5.5% in our target range. Net debt at the end of the quarter was just about SEK 21 billion, and our gross cash position more than SEK 17 billion. In June, Investor issued a 20-year, EUR 500 million bond at an all-in fixed interest rate of just above 1.5%. The average maturity of the debt portfolio amounts to 11.2 years. That was all from me. Magnus.
Okay, thank you, Helena and Johan. We will move over to Q&A. If we have any questions, please.
Ladies and gentlemen, if you have a question, please press 0 one on your telephone keypad and you will enter a queue. Our first question comes from the line of Joachim Gunell of DNB. Please go ahead. Your line is open.
Yes, good day. First to start off, you've increased the speed of significant divestment as of lately. My question is basically on the timing and why from an Investor AB perspective, does it make sense to make these deals now?
Thanks for the question. It's always the case that we have a strategy to reduce the financial investments, that's always with different deals. In some cases, you need to do some improvement before you divest. In some cases, you need to find the right buyer of the asset. It's normal business. We are executing on the strategy, it happened to be that over the last quarter, a number of them went in the right direction for us.
Very clear. Perhaps a follow-up. In conjunction with the announcement of the Memira divestment, where you had some, I think it was 60% ownership, you commented that it implies that you can continue the strategy on wholly owned subsidiaries in Patricia Industries. Could you just help me understand in what way is it preferable to, say, have 90% plus ownership, as in most of the Patricia Industries holdings? With that in regard, what is your view on, say, a holding such as 3 Scandinavia, where you own 40%?
Our strategy in 3 Scandinavia has a long history because we did build that up from the beginning, the whole company, together with Hutchison. We have a good cooperation with Hutchison regarding 3 Scandinavia, we are continuing that. That is a little bit of a separate case. Other than that, our key priority is on the subsidiaries. We like to have that. It's a very good way for us to develop these nice companies. We will now use the proceeds from Aleris and the financial investments to build the strong platform companies such as Mölnlycke, Permobil, Laborie, and so forth, Piab. We would use this money to build these platforms so they become even stronger going forward. That's the top priority.
We are, of course, open for new businesses, but I would say that the top priority for it is to boost organically, but also through acquisitions, develop the existing strong platforms.
That's clear. A follow-up on that, Johan. Obviously, you have the strong balance sheet and the cash flow profile to take on a new company in Patricia Industries, so to say. From an organizational point of view, do you have the capacity to take on new holdings at this stage?
Yes, I think we have. We have a strong enough organization, and we are right now. We have been building out the investment organization a bit in Patricia. Having said that, I would say that our top priority right now is to develop the strong platforms we have rather than looking to buy a lot of new companies. We are, of course, not closing down that part. We are always open for new ideas, the top priority is to build on the existing ones.
Thank you for that answer. Just finally then, I think it's 3.3x net debt to EBITDA in Mölnlycke. It means a slightly more geared Mölnlycke than we've seen previously. I guess there are some IFRS 16 effects obviously in that number. Could you perhaps comment a bit on the balance here with regard to your ambition to maintain an investment-grade rating in Mölnlycke while continuing to make sizable distributions to Patricia Industries?
I think your question is the right one, we are trying to find that right balance. I think to have 3.3x net debt to EBITDA just after a distribution is a good level. As you saw in the quarter, the company is generating very high cash flow. Of course, if they continue to do that, it will quickly delever. If they find good and attractive acquisition opportunities, of course, we will go for those if they are value creative, then we might see a little bit less distribution. If that is not the case, we cannot find those value-creating acquisitions, we will of course, continue to see distributions in the years ahead because the company is generating very strong cash flows.
Thank you very much. Have a good summer.
Thank you.
Thank you. Our next question comes from the line of Ramil Koria of SEB. Please go ahead. Your line is now open.
Thank you very much. Good morning, everyone. Just two questions, if I may. First off, on the announced reimbursement cut in France of 2% on Wound Care and 8% on continent, does that in any way affect Mölnlycke significantly? Perhaps also Laborie, correct me if I'm wrong there, given the European expansion. The second question is, if you perhaps could shed any light on what kind of investments you're looking for within Patricia Industries. Is there any specific company that you're looking to perhaps expand the product portfolio or something like that? Thank you.
Okay. Thank you. First of all, in the healthcare space, it is part of the game that sometimes you get reimbursement cuts. Of course, the companies need to adapt to that, both on the cost side, but also in the market side. Our companies are used to that as part of the game, but you're absolutely right. In this space, there are a lot of positive parts. The volume growth is normally very strong due to the demographics, better wealth in many areas, et cetera. In some areas you see reimbursement cuts and of course that is all else equal, not positive, but that's part of the game.
When it comes to the opportunities we look for, I think for all our strong platforms, that goes actually for our listed companies and for our subsidiaries, we always look for attractive add-on acquisitions, that can be that you build within your core business. It can be that you find attractive opportunities in new geographical markets, it can also be that you broaden the product platform in areas that are related in a good way to the core business. It could, for example, be that you have the same customer base, et cetera. We have a good plan for our companies, and we are looking in a structured way how to find these opportunities.
Thank you.
Thank you. May I remind everyone that if you want to ask a question, please press 0 one on your telephone keypad.
In the meantime, maybe we can have a question from the web then. I will read that it's from [Naseredin] of Ålandsbanken. How sustainable do you think that your organic growth in Wound Care in Mölnlycke is? It seems like the quarterly growth has been boosted by some product introductions. Also, do you think that the price reform in France will have any material impact on growth going forward?
Sorry, the last one was?
It's about the French reimbursement.
Okay. I think when it comes to the French reimbursement, I think I've already covered that one. When it comes to the future growth within Wound Care, as you know, I will never give a forecast because actually that's not meaningful because we don't know how the market will develop. What I can say is, and you see that in the figures, we as an owner, we are supporting the management team to really find all areas of profitable growth opportunities, because with the profitability and the cash flow we have, the biggest opportunity to really create value is of course, to grow the company. Right now we are doing it in a number of dimensions as I said before. We are putting high focus at the moment on the launch of the new products, for example, Mepilex Flex, et cetera.
We are putting sales resources behind these new products to really get the good traction in the market. Secondly, as I mentioned, we are continuing to deliver very good growth in the emerging markets. In the quarter, as I mentioned, we had more than 20% growth in emerging markets. Actually, if I look on the different regions like China, Brazil, Middle East, and certain areas, we are growing at about 20% in most areas in the quarter. I think we have structured initiatives, and they are executing on it, and I have to expect that we will continue to grab all opportunities to grow the company in a profitable way. We will have to see how far it takes us.
Thank you. Any more questions on the phone?
Yes, we have another question from the line of Joachim Gunell of DNB. Please go ahead. Your line is open.
Thank you. Just to clarify here, with the valuation of EQT AB, obviously there has been some internal transactions where your ownership stake is now 23%. Looking at the valuation or the reported values of EQT AB, so to say, there is a valuation or sequential valuation uptick of some 30% plus here in the quarters. Can you just help me understand that? Thank you.
That is mainly related to the transactions we have done. As we said before, this is based on the transaction, the historical transactions. We are now looking, or the company is now looking in different ways how to strengthen the balance sheet. One alternative could be an IPO, other alternative could be to bring in another owner. Depending on what solution we will end up with and the terms of them, of course, we can see a change in the value, but this is what we report right now.
Clear. From a timing perspective, when should we expect to basically get some further insights on what option EQT chooses to go with?
As soon as we have more information, you will get it.
Thank you.
Thank you.
There are no further questions on the line at this time. Please go ahead, speakers.
If there are no more questions at this point, if you come up with any, please let us know afterwards. Thank you everyone for participating, we wish you all a great summer, we'll meet again in Q3 in October. Thank you and goodbye