-- Net asset value on December 31, 2012, was SEK 129 per share, an increase of
29% for the year including reinvested dividends. Net asset value on
February 4, 2013, was SEK 138 per share, an increase of 7% since the start
of the year.
-- The value of the equities portfolio increased by 18% during the year, or
SEK 10.1 billion, to SEK 68.1 billion. The Stockholm Stock Exchange rose
12%. On February 4, 2013, the equities portfolio was worth SEK 71.6
billion, an increase of 5% since the start of the year.
-- The total return for the year was 33% for the Class A shares and 37% for
the Class C shares, compared with 16% for the return index.
-- Income for the year, including unrealized changes in value, totaled SEK
11.0 billion (-15.6), corresponding to SEK 28.50 per share (-40.51).
-- During the year, shares were purchased in the portfolio companies for SEK
3.3 billion and sold for SEK 2.1 billion.
-- Industrivärden is the largest single shareholder of Volvo, with 18.7% of
the votes, after additional purchases of 10 million Class A shares, and
Volvo's conversion of Class A to Class B shares requested by Renault.
-- The Board of Directors proposes a dividend of SEK 5.00 per share (4.50).

CEO's message

2012 was the fifth year to be characterized by the effects of the financial
crisis that began at the start of 2008 and culminated with the Lehman Brothers
crash. Like most financial crises, this one was triggered by a real estate
bubble, with severe consequences for the financial system in general and the
banking industry in particular. The problems began in the U.S., where after a
half decade the country has now left the crisis behind and is moving towards
growth, as moderate as that may be.

The past year was characterized by problems in Europe, which at their core are
rooted in real estate crises in a number of European countries and have exposed
numerous difficulties. When the lending banks encountered problems, governments
that were already highly in debt were forced to step in to rescue the privately
owned financial system with public funds. So what essentially has transpired is
a solvency crisis. Even though major challenges remain, there are now signs
that the euro crisis is also on a path to stabilization. In China as well as
the rest of Asia, accelerating growth is forecast. Such is also the case in
South America, led by Brazil, which had weak performance in 2012. There is
therefore reason for some optimism.

For a long-term oriented and active owner as Industrivärden, the most central
factors are to ensure that the companies we invest in have the right
management, a clear direction, and organicly develop their core business. It is
also important that we, in our capacity as a holding company, adjust our
portfolio composition over time. Here I would like to give some examples on a
number of concrete activities of various kinds that were carried out in 2012.

Handelsbanken has continued to perform very well in terms of profitability,
growth and stability as well as customer satisfaction. The bank's success and
its unique organizational model for its banking business are the focus of
growing attention, including in the international press. Its profitability is
once again, for the 41st year in a row, better than the average return for its
competitors. During the year, Handelsbanken continued to perform well in
markets outside Sweden. In the UK, where it is growing organically,
Handelsbanken opened its 133th branch in 2012.

Despite the weak economic development during the second half of 2012, Sandvik
managed to post strong full-year earnings, with improved margins and higher
profitability. This is tangible proof that the necessary work begun by the
company's new management on changing Sandvik into a more modern and global
enterprise is beginning to generate results. Sandvik is now taking extensive
measures to strengthen profitability through sharper focus and higher
efficiency. With a starting point in major know-how in value-based sales that
are centered around customers' processes and efficiency improvement needs,
Sandvik is well equipped to develop into an even stronger company.

In connection with Renault's sale of all 139 million of its Class A shares in
Volvo, of which 110 million were converted to B-shares, we bought another 10
million A-shares for SEK 0.9 billion. With 19% of the votes, Industrivärden is
thereby the largest shareholder of the world's leading provider of commercial
transport solutions. Together with the Handelsbanken Pension Foundation and
Handelsbanken Pension Fund, we now control 21% of the votes. We have a strong
belief in Volvo's development potential, and the efficiency and profitability
enhancement work that has been initiated by Volvo's management bodes well for
the future. In January 2013, Volvo entered into a strategic alliance with the
Chinese vehicle manufacturer Dongfeng, making Volvo the world's largest
manufacturer of heavy-duty trucks and strengthening its position and growth
opportunities in Asia.

Through the acquisition of Georgia-Pacific's European tissue operation, the
previous acquisition of Procter & Gamble's European tissue operation, the sale
of the European packaging operation and the divestment of the paper mill in
Laakirchen and of its part ownership in Aylesford Newsprint, SCA has carried
out a strategic transformation towards more stable and highly refined products
with higher profitability. SCA is now the clear market leader in Europe in
tissue and hygiene products. Moreover, the acquisitions are enabling further
efficiency improvement measures and are giving rise to both revenue and cost
synergies. The foundation has now been laid for SCA to take advantage of its
strong and profitable position in Europe to move forward with ventures in
emerging markets in Asia and South America. SCA's focus on products with stable
demand and higher profitability has been well-received by the stock market. In
2012 SCA's stock rose 40%, compared with 12% for the Stockholm Stock Exchange.
It can also be noted that SCA, for the first time in a long time, is now valued
above its visible equity.

Ericsson, which is a leading provider of communications networks and related
services to telecom operators, further strengthened its positions in 2012. The
company has long been a major player in the important U.S. market and stands up
very well against its Chinese competitors in the world market. In recent years,
Ericsson has focused on capturing market shares in Europe, where operators are
upgrading and expanding their networks. This has resulted in lower gross
margins but creates good future potential. Through selected acquisitions and
divestments, in recent years Ericsson has further geared its business towards
its core areas - networks and related services.

Skanska is one of the world's leading construction companies, with strong
positions in Europe and the U.S. By combining efficient construction operations
with a successful model for value-creating project development, Skanska has
generated substantial shareholder value over time. The company is working
actively to capitalize on its size and global presence by developing
operational synergies in areas such as knowledge, purchasing and development.
In 2012 Skanska started its first infrastructure project in the U.S. and sold
its first commercial real estate project in the country. We have a strong
belief in Skanska's future opportunities, and in 2012 we bought additional
shares in the company for slightly more than SEK 700 M.

In 2012 SSAB, whose Nordic operations produce mainly sheet steel, was hit hard
by the recession in large parts of Europe. Parallel with this, the company
concluded the strategic investment program that was started in 2008 through the
acquisition of the North American steel maker IPSCO. This acquisition has been
a very good deal for SSAB, where the North American operations have carried
SSAB through the crisis that plagued the European steel industry in recent
years. Through the investments that have now been completed, SSAB has
consolidated its market-leading positions in high-strength and quenched steels
- now also with substantial manufacturing capacity for specialty products in
North America. A higher need for lightweight and energy-efficient steel with
special material properties creates good future opportunities for SSAB.

The equities portfolio had good growth in value in 2012, and a large share of
the drop in value that occurred in the wake of the financial crisis has now
been recovered. Net asset value, including reinvested dividends, rose 29% to
SEK 129 per share. Industrivärden's Class A and C shares posted total returns
of 33% and 37%, respectively, compared with 16% for the Stockholm Stock
Exchange return index. For the longer 5-, 10-, 15- and 20-year periods,
Industrivärden's stock has generated a higher total return than the Stockholm
Stock Exchange - a comparison that is even stronger next to the European or
world indexes. It is also gratifying to note that our short-term trading had a
good year, despite a difficult derivatives market with relatively low turnover.
Profit totaled SEK 118 M, and the operation has now earned approximately SEK
1.1 billion since its start in 2003.

The Board's proposal for a dividend of SEK 5.00 per share represents an
increase of 50 öre, or 11%, compared with last year. This also means that we
continue to fulfill our goal of paying a favorable dividend yield that is
higher than the average for the Stockholm Stock Exchange.

Our portfolio companies have leading positions in their business areas, global
coverage and a growing presence in emerging markets. With a well developed
business model and strong financial base, we have favorable prospects for
creating competitive shareholder value.

Anders Nyrén


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