Everyone, this is Magnus Dahlhammer, Head of Investor Relations at Investor. I would like to wish you all a welcome to our Q2 2019 presentation. And this will be made by Johan Fussell, our CEO and Helena Saxon, our CFO. And as always, after the presentation, there will be an opportunity for Q and A. And with that, over to you, Johan.
Thank you, Magnus. I think I in the 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 percent. Our total share return was up 9% compared to the stock market plus 7%.
The lithium portfolio was up 6 percent and we made a SEK 2,000,000,000 investment in ABB during the quarter. Within Patricia, we had a 6% value increase. Aleris was divested after the end of the quarter, and we have made significant exits within financial investments. And I will come back to that. If we look on the major subsidiaries, sales growth was plus 10% of which 2% was organic in constant currency and the profit was up 15%.
If I should make a few comments on these figures, Alaris has as you know now been divested. If we exclude Aliris, the organic sales growth in constant currency was 4%. And if we exclude Aliris and Labore since last year Labore took significant restructuring costs, both state companies if you ask for both Labri and Aliris, the operating profit increased by 7%. EKT had a very good development, up 8 percent in constant currency. And as we previously have announced, we increased our ownership to 23%.
And finally, we have a strong balance sheet with a leverage of 5.5%. And then in addition to that, of course, we have done significant exits and the proceeds are not included in the cash balance as of June 30. So with that summary, let's move then over to the divestment of Alaris. On July 12, we announced that we are divesting SEK2.8 billion and adjusting them for the net debt and also some transaction costs, the equity will be about SEK 2,000,000,000. And we expect the deal to close during the Q3.
And this capital that we will free up will be used to build and develop the strong platforms within Partition Industries. Moving then to Slide number 4 and financial investment. I think we in a very good way are executing on the strategy to maximize the value for the financial investments. We have in the quarter, we have divested TRY 1,000,000,000,000 and that is in the cash position as of June 30. And divestments not included in our cash position as of the end of the second quarter include Enes Focus and Vemira that was divested after the end of the quarter and finally WhiteHat 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 exceeded $2,000,000,000 So combined with the announced divestment of Alaris, our investment capacity is significantly strengthened and equally important, this divestment result in a more focused portfolio. Then moving over to Nellikke. The organic sales growth was 5% in constant currency, good to see that we have been in 3 quarters in a row at that level.
All geographies contributed similarly to the overall absolute growth. This means that the emerging markets grow just about 20% and that we had a higher growth in the U. S. Compared to Europe. The EBITDA margin stayed at healthy level, but was impacted by the investment in sales and marketing.
Due to the strong cash flow generation, €175,000,000 was distributed. And then 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 gross markets. And the focus here remains to really get good traction behind all the new product launches.
So 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. And within the different product categories, gloves and surgical trays were the main drivers.
Moving then to Permobil. The organic sales was down 3% in constant currency. Power and seeing and positioning declined, while manual actually grew in the quarter. And regionally, reported strong growth. It was actually up double digit in the quarter.
The EBIT margin improved, driven by both different initiatives to control cost, but all the production efficiency improvements and then there was also positive currency effect. Also, dollars 120,000,000 was distributed, of which the majority is, of course, to Patricia. And then the work is continuing to consolidate the manufacturing footprint and reduce complexity basically closing down some smaller units. And then following the introduction in the Q1 of the new F6 that's the front wheel drive, it was launched globally during the Q2. Moving to Labor E.
The organic sales growth was 1% in constant currency. We saw modest growth in urology, but we saw a slight decline in gastrointestinal segment. The revenue, we should remember when we look on the figures that the revenue in the Q2 2018 was boosted by shipments that were delayed from the Q1 of 2018. So it's a strong comparable period. The development on the business is developing nicely.
Profitability continued to improve in line with our plans, driven by cost savings materializing from the Coiantix acquisition and also that we now have gotten good traction from the European restructuring. Moving over to Piyab. Piyab, you see that the organic sales growth was actually minus 3% in the quarter, and that is mainly driven by the robotic gripping division that is affected by the weak automotive market. But also internal measures are affecting the growth. We are reorganizing the sales channel for this product line.
The underlying despite the lower revenues, the underlying profitability improved slightly. And then Klas 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% to 2% of sales of the total company. Cernova 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. Also Sanova did a small acquisition in the quarter, also here roughly 1% to 2% of sales to give an order of magnitude. 3 had a good development. Subscription base was up 42,000. If we adjust for the VAT ruling, the underlying service revenue was up 6%.
And 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. And the company distributed SEK 300,000,000 of which SEK 120,000,000 went to Patricia. Moving then over to EQT. It's a very strong development with a value increase of 8% in constant currency. And as we previously announced, we now own 23% in the company, but the total exposure to EKT is essentially unchanged.
In the quarter, we had a negative cash flow of about SEK 600 100,000,000, but that negative part of it is entirely explained by transactions related to the simplification of the ownership structure of the company. And as of today, the value of all our investments into IKT has a value of SEK 24,000,000,000 So 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 growth that adjusted net asset value reached $422,000,000,000 at the end of the quarter, while the reported net asset value was 366 €366,000,000,000 Turning to the next page, looking at the listed companies, a portfolio valued at SEK 310,000,000,000, the contribution in the quarter was SEK 17,000,000,000 and the total share will be returned 6%, just shy of 6 Rx 7%. And Atlas Copco was the company that contributed the most, while Wartsila and Sobeys had a tougher quarter. Turning the Page 2, Patricia Industries' sequential development of estimated market values. We can see that the development was very positive.
And while Lavery and Mandlikh were the main drivers of this value increase, all subsidiaries contributed to the value growth in the quarter. And distribution to Patricia amounted to 2,200,000,000 dollars Looking at the next page more specifically at the value drivers, we see that library market value increased 1 point $2,000,000,000 in the quarter and this due to sharp increase in profits and higher multiples. Mannliche's estimated market value increased by $1,100,000,000 due to strong cash flow, higher multiples and FX. Malleke was also the company that distributed a significant amount, dollars 1,800,000,000 in the quarter. BraunAbility's estimated market value increased by $900,000,000 due to higher profits and multiples.
Para Mobile increased its estimated market value by $500,000,000 and this was due to higher profits, cash flow and multiples. The company also distributed money to Patricia in the quarter. 3, the estimated market value increased by $400,000,000 due to higher multiples, and there was also a small distribution of $120,000,000 in the quarter. Looking at the next page, financial investments. Johan already mentioned that Patricia is executing on his strategy for financial investments.
Enes Focus and TRILLIONS were sold in Q2. MEMIRA and WhiteHat Security were both divested after the end of the quarter, now in July. The 5 largest financial investments now amount to SEK 2,400,000,000. Finally, our financial position on the next page. Our financial position remains strong with leverage of 5.5 percent in our target range.
Net debt at the end of the quarter was just about $21,000,000,000 and our cash gross cash position more than $17,000,000,000 In June, investor issued a 20 year SEK 500,000,000 bond at an all in fixed interest rate of just above 1.5%. Now the average maturity of the debt portfolio amounts to 11.2 years. And that was all from me. You have my minus.
Okay. Thank you, Hiligena and Johan. Then we will move over to Q and A. If we have any questions,
And our first question comes from the line of Joakim Gunnell of DNB. Please go ahead. Your line is open.
Yes. Good day. So first, let's just start off. You've increased the speed of significant divestment as of late. So my question is basically on the timing and why from an Investor AB perspective does it make sense to make this
now? I think it's always thanks for the question. It's always the case that we have a strategy and to reduce the financial investments. And 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. So it's normal business. We are executing on the strategy and it happened to be that over the last quarter, a number of them went in the right direction for us.
Very clear. And in well, perhaps a follow-up. In conjunction with the announcement of the Meniere 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 Perficient Industries. So could you just help me understand with in what way is it preferable to, say, have 90% plus ownership as in most of the Patricia Industries Holdings?
And with that in regard, what is your view on, say, a holdings such as 3 Scandinavia where you own 40%?
I mean, our strategy in 3 Scandinavia has a long history because we did build that up from the beginning, the whole company together with Hatch. And we have a good cooperation with Hatch regarding 3 and 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 Alaris and the financial investments to build the strong platform companies such as Mernlikh, Permobil, Laboree and so forth. And we would use this money to build these platforms to so they become even stronger going forward. So 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. And then a follow-up on that then, Johan. Obviously, you have the strong balance sheet and the cash flow profile to take on a new company in British Industries, so to say. But 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. But 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.
But we are, of course, not closing down that part. We are always open for new ideas, but the top priority is to build on the existing ones.
Thank you for that answer. And just finally then, I mean, I think it's 3.3x net debt to EBITDA in Mannliche. It means a slightly more geared Mannliche than we've seen previously. I guess there are some IFRS 16 effects obviously in that number. But could you perhaps comment a bit on the balance here with regard to your ambition to maintain an investment grade rating in Melendlykke while continuing to make sizable distributions to Patricia Industries?
I think your question is the right one, and we are trying to find that right balance. I think to have 3.3 times in 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. So of course, if they continue to do that, they will quickly delever. And if they find good and attractive acquisition opportunities, of course, we will go for those if they are value creative.
And then we might see a little bit less distribution. If that is not the case and 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.
Thank you. Our next question comes from the line of Ramiel Khouria of SEB. Please go ahead.
Your line is now open.
Thank you very much and good morning everyone. Just two questions, if I may. So first off, on the announced reimbursement cut in France of 2% on wound care and 8% on Continence. Does that in any way affect Molik significantly? And then perhaps also Lebri, correct me if I'm wrong there, given the European expansion.
And then the second question is if you perhaps could shed any light on what kind of investments you're looking for within Is there any specific company that you're looking to perhaps expand the product portfolio or yes, something like that? Thank you.
Okay. Thank you. First of all, I mean, in the health care space, it is part of the game that sometimes you get reimbursement cuts. And then, of course, the companies need to adapt to that both on the cost side, but also in the market side. And our companies are used to that.
It's 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, etcetera. But 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 and that goes actually for our listed companies and for our subsidiaries, We always look for attractive add on acquisitions and that can be that you build within your core business. It can be that you find attractive opportunities in new geographical markets. And 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, etcetera.
So we have a good plan for our companies, and we are looking in
a you.
In the meantime, maybe we can have a question from the web then. And I will read that. It's is from Lars Serdafela from Alliance Banken. How sustainable do you think that organic growth in wound care in Maliki East? It seems like the quarterly growth has been boosted by some product introductions.
And also, do you think that the price reform in France will have a material impact on growth going forward?
Sorry, the last one was.
It's about French reimbursement.
Okay. I think on when it comes to the French reimbursement, I think I 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 any meaningful because we don't know how the market will develop. What I can say is and you are starting to you see that in the figures. We as an owner, we are supporting 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 dimension as I said before. We are putting high focus at the moment on the launch of the new products for example, Meplix, Flex, etcetera. And 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. And in the quarter, as I mentioned, we had more than 20% growth in emerging markets.
And 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. So I think we have structured initiatives and they are executing on it. And I just expect that we will continue to grab all opportunities profitable way. Then 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 Goel 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%. But looking at the valuation or the reported values of EQTIB, so to say, there's a valuation or sequential valuation uptick of some 30 percent plus here in the quarters. Can you just help me understand that?
Thank you.
That is mainly related to the transactions we have done. And as we said before, this is based on the transaction, the historical transactions. And 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 this of them, of course, the change we can see a change in the value, but this is what we report right now.
Clear. And from a timing perspective, when should we expect to basically get some further insights on what option Iqiti EQT chooses to go with?
As soon as we have more information, you will get it.
Thank you.
Thank you.
And 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 instead. With that, thank you everyone for participating and we wish you all a great summer and we'll meet again in Q3 in October. Thank you and goodbye.