Ladies and gentlemen, welcome to the Investment AB Latour's Q3 report for 2021 . For the first part of this call, all participants will be in listen-only mode, and afterwards, there'll be a question and answer session. Today, I am pleased to present Johan Hjertonsson, President and CEO, and Anders Mörck, CFO. Speakers, please begin.
Thank you so much. Thank you, everybody. Welcome to our Q3 webcast, where we'll present the Q3 report with our comments. Then, as said, at the end, we open up for questions. Very welcome. By my side, I have Anders Mörck, our eminent CFO, to help me take us through the presentation. If we start with the first slide, as you know, we have two main business lines, our investment portfolio and our wholly owned operations. I'm happy to report that we continue the good development overall, however, with the increase in supply chain disruptions and cost increases, and a lot of things that we need to do to offset these temporary issues, I should say.
However, most markets are very strong with an underlying strong demand, I would say overall except Asia-Pacific and China. As you can see, there is a very strong order intake. However, sales is lacking slightly behind order intake due to the supply chain disruptions. We'll come back to that later on in the presentation. As I said, the two main business lines, the wholly owned operations, the investment portfolio still intact. We have two additions this quarter that I'm very happy to report. We have Densiq as a new business area in the wholly owned operations, and we have CTEK as our tenth listed holding in the investment portfolio. We'll come back to both of them further on in the presentation. I think we can change slide then, please.
As you can see here, CTEK was added in September, and Latour stepped in as the largest shareholder. We hold 31% of the shares in CTEK. CTEK is a global leading supplier of battery chargers and also chargers for electrical vehicles. CTEK has a great potential for growth and is an exciting add-on to our listed investment portfolio. Very happy and very welcome to the CTEK team into the Latour family. When it comes to the investment portfolio value development, 21.5% during the year, SIXRX 24% at the end of the quarter. As I said, the underlying development is satisfying. In general, good order intake increasing and sales is slipping behind slightly. But this results in a record level of order backlogs.
The Asia, Asian market overall, I would say, is slightly slower than the rest of the world, actually. Very high activity with acquisitions in many of our portfolio companies. I would especially like to highlight ASSA ABLOY. ASSA ABLOY that has done its largest acquisition so far with the U.S.-based HHI. Until yesterday, the portfolio value had increased to SEK 91.8 billion, resulting in a total return of 34.5% so far this year with a SIXRX return of 33.9%. Having said that, we can go into the next slide, and we'll talk a bit about the wholly owned operations. As said, continued good development.
We see a strong market demand with a good growth in order intake and an organic growth of I would say stellar 20%. It's a very strong organic growth in the order intake. As you can see, it's the theme of the conference here. Sales is not developing in the same pace. It's a 9% organic growth, whereas the order intake was 20%. We have a very high order backlog. We are very certain that the order backlog will transform into sales going forward. We have almost one-to-one ratio on order backlog and sales, but it's just delayed. The main reasons for this is the supply chain disruptions, increased raw material prices, and that is affecting to various degrees in our companies, but it affects more or less all companies.
However, we're happy to report that our customers are not affected to a greater extent, but it affects the margins in the short term. We have prioritized to keep the customer service level on a high level, albeit to a higher cost. I think it's also important to communicate that we're confident that we have pricing power in order to pass on cost increases going forward. Operating profit grew 3% to SEK 680 million compared to SEK 602 million last year. EBIT margin at 14.2%. The high investment pace continues. We think that's the best way to maintain competitiveness and continue to gain market share. We invest a lot in product development in our brands and into our sales and marketing operations.
I'm very happy to announce Bemsiq as our sixth business area within Latour, and then we have a whole slide on that business area if we go forward then. Bemsiq was created within Latour Industries, and Latour Industries' whose sole purpose is really to create new business areas within Latour. Congratulations to Latour Industries that you have created Bemsiq, that is now, as of now, standing alone, so to speak, as a separate business area within Latour. Bemsiq Group was established in 2016 with net sales of about SEK 300 million. Bemsiq has grown organically and through acquisitions. Bemsiq today comprises of seven companies with a total net sales of about SEK 1.1 billion, with a good profitability and an operating margin of approximately 20%.
Very nice, operating margin in Bemsiq. Bemsiq is a leading global provider of technology and product for sensing, controlling, and connecting in commercial buildings. This will help to accelerate this, the journey towards smart and green buildings. Bemsiq really operates in that whole space. It's a very interesting investment area going forward. The companies operate individually within Bemsiq. Bemsiq functions as the shared platform for growth, realizing the synergies across the companies where they are possible and logical. As before, Mikael Johnsson Albrektsson is now the business area manager of Bemsiq. Congratulations to you, Mikael, and we look forward to continued strong growth. You see the graphs there, Mikael, it's just the same tangent on the graph that we expect going forward.
Having said that, we go into the next slide, where we'll comment a bit on our acquisitions. As you can see, we have had a very high pace when it comes to acquisitions within Latour. We have done four acquisitions during the quarter. Swegon acquired a majority of 720°, a Finnish digital software company that will accelerate Swegon's offering in digital services. Aritco within Latour Industries acquired Swedish Motala Hissar with annual net sales of about SEK 200 million. Motala Hissar is a well-established and leading manufacturer of platform lifts and sells through distributors across a large part of Europe. Bemsiq acquired Canadian Greystone Energy Systems with annual net sales of CAD 22 million.
This will further strengthen Bemsiq's geographical reach with a strong base in North America for continued growth over there. Then Densiq within Latour Industries acquired DEPAC based in Liechtenstein with an annual net sales of about EUR 8 million. This will strengthen Bemsiq's offering within advanced sealing technology. Also, after the quarter had ended, Hultafors acquired Danish Scangrip with an annual net sales of DKK 220 million. I should say, Scangrip has a very strong profitability, actually above the average of the Hultafors Group. Scangrip is a leading manufacturer of industrial work lights with innovative LED technology. Also after the end of the quarter, Latour Future Solutions invested in Swedish Hydro Solutions. Swedish Hydro Solutions offer sustainable solutions for water treatment.
It uses nature's own biochemistry instead of aggressive chemicals to purify large amounts of water. Very welcome to all of these six companies into the Latour family. Very happy to have you on board. Having said that, I'm very pleased to hand over to Mr. Anders Mörck, who will take us through the development of the business areas and some more things on top of that. Over to you, Anders.
Oh, thank you so much, Johan. What a beginning of this presentation. We start with the first business area, Caljan. Caljan has had a very strong underlying demand for a while now, supported by the e-commerce mega trend. Order intake in the quarter was EUR 50 million. Organic growth in order intake was 197%. The accumulated order intake is EUR 190 million, and the order book, as you understand then, is on a new record level. The net sales is also developing very positively, but well above last year, but not in the same pace as the order intake. Maybe that says something about what comes in the future. No surprise then, we have had supply chain challenges, increased prices on raw material, shortage of electrical components and logistics challenges.
You might hear that word from me a few more times, but it's just, repeating what Johan said before. On that note then, it's very impressive that the operating profit amounts to EUR 7.6 million during the quarter with a margin of 19.2%. We shall also say that we do continued investment in Caljan's expansion. We have started the establishment of a new factory in Germany, after, as we have said before, the Latvian expansion and the U.S. expansion in Caljan. Okay. We change to the next page and go to Hultafors Group. Hultafors has had a continued good sales development for all product areas. The net sales growth was 43% during the quarter, and the organic growth was 13%.
Surprise again, Hultafors Group has also had supply chain challenges, price increases and delivery disruptions, mainly from Asia. That has, of course, negatively affected the profit in the quarter. The profit amounts to SEK 170 million, with a margin of 13%. We have put a high focus on actually meeting customer demand and keeping the customer service at a very high level. At this quarter then to a certain cost, which means that the profit margin was reduced to 13%. Our recently acquired company in Borås and Denmark and Finland, Fristads, Kansas, Leijona is developing very well and according to plan. As Johan said before, we acquired SCANGRIP in October. All in all, in a very positive development for Hultafors, but with challenges in the supply chain.
We turn to the next page, and that is Latour Industries then, and we shall start to say that the figures then still during the third quarter include Bemsiq, just to be clear about that. Very positive development over order intake and sales for actually all units. Also here we are experiencing a lot of supply chain challenges in the same dimensions as for the other areas. Very good cost control and a positive profit development with an operating margin of 12.6%.
As we have said before, this is the place where we build new business areas, meaning that a lot of the companies have a high investment to do better off in the future, meaning that once they are through these investments and have grown the capacity to earn even more is significant. As Johan said before, we have made a lot of acquisitions adding to the group. Now it's been Motala Hissar, Greystone Energy Systems, and DEPAC during the quarter. All in all, in a very positive development for the business area and very well managed then by the management team, Björn and Magnus Ljungdahl and their teams in the companies. Thank you so much for that. We go to the next page, Nord-Lock Group.
Also Nord-Lock has had quite a strong organic growth, mainly driven by Europe and America. The organic growth was 20% in sales and 17% in order intake. However, then as Johan said before, Asia-Pacific is slower due to the slowdown, mainly in China. That affects both top line and profitability negatively. Of course, supply chain challenges need to be repeated also here. We have had a very high focus on customer service and availability of products. We think, and we know that we have gained market shares this quarter. Operating result of SEK 98 million with an operating margin of 27%, which is quite good. We turn to the next page and go to Swegon.
Swegon has had a high activity once again with an order intake growth organic of 16%. The net sales once again then not in the same level. Supply chain challenges in combination with delayed building products lower the net sales. This has of course then a negative effect on the net sales growth. Profit also negatively affected due to both investments in long-term growth and the supply chain issues that reduces the productivity. The operating result of SEK 158 million means that we have a profit margin this quarter of 11.5%. As you answered, Swegon made the acquisition of 720° in July. Let's turn to the next page, going over to the net asset value then.
We have a net asset value that has increased by 25% during the year to SEK 188 per share. At the same time, SIXRX developed by 24%. The share price at the end of September was SEK 272, which means that it's a premium to our net asset value of 45%. That's then with our cautious valuation with our wholly owned operations. We have noted that before. You can have very different views on this, and our figure is just a guiding of a prudent view of the value. We would have a significantly higher value if we would make a valuation of the entire group and compare it with other well-known listed companies with a mixed industrial holdings portfolio and similar acquisition agenda.
Yesterday, the net asset value had increased to SEK 200 per share. The share price was 334, and the premium then was 67% compared to our prudent net asset value. The consolidated net debt increased during the quarter from SEK 6.7 billion to SEK 8.5 billion due to acquisition. That means that the net debt now corresponds to 7% of the market value of our investment. Back to you, and next picture.
Thank you, Anders. Great presentations with your comments. Commenting on the financial targets here, our long-term perspective financial targets. As you can see, our targets are to have a growth more than 10%, operating margin more than 10%, and a return on operating capital somewhere 15%-20%. During the rolling twelve months, we've had a growth of 18.3% and an EBIT margin of 14.9% and a return on operating capital of 16.5%. Very happy to report that we're well above the thresholds of all our three financial targets. Having said that, when commenting on the operating margin of 10%, I'd like to point out that that's really a minimum target for a Latour company.
It should always be well above 10%. All in all, very strong performance, and I'd like to thank all coworkers and members of the team for this great financial result. Going into, I believe the last slide in the presentation, where we comment on the international growth. As we said, overall a strong third quarter, to say it hopefully for the last time, supply chain is the main challenge. Overall, it affects all our holdings, and it affects the profitability in the short term. This in combination with last year's very strong margin developing, we're also facing increasingly tougher comparison figures going forward.
As I said in the onset of the presentation that we are confident that we will pass on the cost increases going forward, that we have what's called pricing power in the market. Latour is a long-term owner, and our ambition is not changing due to the short-term disruptions. We still have a long-term ambition for growth, very strong growth, and I think we've shown that in these quarter three numbers that we have a very strong focus on growth, and we've delivered a lot of growth as well. We're truly delivering on the growth target, as I said, but a large portion of potential remains. Look at the map. We have 80% in Europe, 13% of sales in North America, and only 7% in Asia Pacific.
There is such a fantastic opportunity going forward to increase this growth long-term. We continue with all our long-term initiatives in our companies as before, and we act with a positive forward-looking view. That concludes the presentation from Anders and myself, and then we open up for Q&A. Thank you all.
Thank you. Ladies and gentlemen, if you have a question for the speakers, please press zero one on your telephone keypad. Our first question is from Joachim Gunell of DNB Markets. Please go ahead. Your line is open.
Thank you. Good day, Johan and Anders. First to start off with just a question on the Q3 momentum here. With regards to this, I mean, order intake in Caljan, can you just help us understand here the dynamics on. I mean, if we were to look beyond the short term, supply chain constraints, I mean, how does that work? Over what timeframe do they attempt to deliver, that their orders?
We say orders that Caljan take today is for delivery within the next 6-9 months. They have a very full production in Caljan. What you see in the Caljan order stack is almost a year of production in that order stock. It's quite long delivery times. It's quite large projects in there.
Understood. No, that's helpful. With regards to, I mean, Bemsiq becoming its own business area, can you talk about, okay, I mean, obviously there's some scalability or scale parameters going into that. With regards to that, okay, other potential business areas are also, I mean, approaching similar size. Can you talk a bit about the timing and what this enables for Bemsiq to become its own subsidiary?
Yeah. First of all, I think it has the size now. It's above SEK 1 billion that you're alluding to, Joachim. It has a very strong profitability. It has shown growth and stable profitability over a long time, which is important to create a business area. Then there are also other variables that are important. We have a good leadership team established in Bemsiq, and they are ready to be a separate business area. As you know, our business areas, we try and run them as standalone as possible. From all of those aspects, we think it's time for Bemsiq to be its own business area and to show the full potential going forward. Do you want to add to that, Anders, or?
No, I think you said it all, actually.
Okay.
You have to be stable in both growth and profitability and management, and you have to have that in place, otherwise it wouldn't be possible.
Understood. It appears as the market already seems to assume that you will be able to replicate the track record here as an early, call it, public minority shareholder, as you were in Troax and HMS, et cetera, also in CTEK. With regards to that, do you continue to see perhaps attractive anchor investor opportunities in the listed environment, I mean, beyond CTEK? Also some comments on the CTEK here. Where do you see yourself best suited to add value in that holding over time?
Thank you, Joachim. I think, as you can see, last time that we did an anchor investment before CTEK was Troax many years ago. We are quite picky when we choose to be an anchor investor when we do that. That's nothing we do every day, and I think there's lots of companies being listed, as you know, today on various stock markets, and prices are quite elevated. CTEK, however, is a company that we followed for many years, and we knew that in some shape or form it would become out on the market, so to speak.
Now we saw the opportunity, and we really like the company because it has a global position in a well-proven technology, which is 12-volt battery charging systems. But it has also a very interesting upside with charging for electric fully electric vehicles going forward. We are extremely long-term, and it's an indefinite horizon on our investments in CTEK. I think CTEK has a lot of Latour qualities. It's really an industrial company. It has an international outlook, and I think we can add a lot of value in the board going forward, and also in the company by giving them access to our network and other colleagues, and give them a good industrial home for long-term growth within Latour.
Understood. Thank you. That's very helpful. I'll get back in line and see if there are any other questions.
Mm-hmm.
Thank you. Just as a reminder, if you wish to ask a question, please press zero one on your telephone keypad. We have a follow-up question from Joachim Gunell. Please go ahead.
Yeah. Okay. Just two quick ones. First of all, I mean, as I understand it, there are some tax changes on capital gains in the U.S. for selling businesses. Is this something that in any way with regards to your, I mean, ambitions to build a North American presence for some of your subsidiaries, does this facilitate those plans in any way?
Anders?
It looks like Johan don't want to answer this question. I would say that I'm actually not aware of the details in the rules that you say, but I cannot see that it should have any impact on us because we are not selling companies if it was capital gains when you sell companies.
No, absolutely.
O- o-
I was just wondering whether if that, I mean, call it, multiplied the number of potential businesses that's out there for sale, basically.
Oh, okay. I have actually no clue on that question. I'm sorry, Joachim. Hope you can live with that answer for now.
Absolutely.
I will investigate more.
It was a curveball.
Yeah.
Just a final one then.
Yeah.
I mean, this is also one, but I mean, going into the next year, I assume we will talk more and more about, okay, EU taxonomy and alignment as such. I mean, for an investment company like you, I guess that it's very hard to get an aggregate view of your, call it, alignment for the portfolio as a whole. I mean, now that, okay, Bemsiq, we will get more light on a holding like Bemsiq, which would obviously screen quite well out of that, and with regards to, oh, I mean, CTEK for that matter as well, and I mean, there are already a number of holdings that are very I mean from a thematic point of view, this should screen very well with the EU taxonomy.
What are your thoughts with regards to Latour's taxonomy alignment as a whole?
I can start maybe and ask a little bit in general, and maybe then, Anders, you can comment on how we're addressing the taxonomy challenge, if I put it that way. I think, Joachim, to your point, I think we're very happy that we have already many companies that are clearly ESG positioned. I also think we're strongly showing over the last year that we're taking this very, very seriously, and we're actually walking the talk. I mean, we have set up Latour Future Solutions where we help and take minority investments in smaller companies that are really accelerating the ESG agenda. That's up and running, and we've done several investments there, so we really delivered on that, and I'm very happy about that.
Also on a larger scale, we show that we put our money where the mouth is, and we've done a little bit more than SEK 1 billion investment into CTEK that has also clearly an ESG positioning. That's on top of all of the very nice positioned, ESG positioned companies we have, like TOMRA, Fagerhult, Sweco, Bemsiq, to mention a few of them. When it comes to how we do the accounting and the taxonomy, Anders, I know we're talking a lot about that and working with that.
Mm.
You wanna comment on that, Anders?
Yeah, I can give comment. Well, as Johan said, we are doing a lot of things as a good citizen or a good company, and we are investing in sustainable companies. For example, TOMRA then that is truly a company that fulfills most of the things in the taxonomy, I would say. That is actually nothing that we can when it comes to our reporting of taxonomy alignment. We shall look then on our wholly owned operations. We shall look on what the rate of our net sales that is aligned with the taxonomy in the future. The preliminary view is that we do not have many businesses that do significant harm, but that does not by default mean that they are aligned with the taxonomy.
We would get most part of Swegon and most part of Bemsiq would probably fall under alignment in the future. For the other companies, we'll have to dig deep to find truly aligned net sales. It will still be, I think the word is, eligible or something like that I would place the rest of our group in preliminary. My colleague will kill me if I say wrong now, but Katarina is listening into this call as well.
Okay. Let's hope she doesn't do that. I would assume that some of which at least acts as indirect enablers for your, for their respective customers to reach their thresholds. Yeah, no, that was helpful. Thank you. That's all from me, guys.
Thanks.
Thank you.
Thank you, Joachim.
Thank you, Joachim.
Thank you. There are no further questions at this time, so I'll hand back over to our speakers.
Thank you. I know I just wanna state the fact, I know there's a lot of people on the call, and I'm very thankful for Joachim asking questions, but I think I encourage more of you to ask your questions so we get even more dynamics in the call on our next quarterly presentation. Actually quite many of you on the call. Having said that, thank you, Joachim, for asking some questions. That concludes the presentation from the Latour team. From Anders and myself, thank you all for calling in, and thank you for listening. Looking forward to speak to you again with the full year's result in quarter four next year. Thanks a lot.