Year-End Report 2005

• Industrivärden’s net asset value was SEK 50,596 M on February 14, 2006, an increase of SEK 2,344 M for the year to date. Net asset value on December 31, 2005, was SEK 48,252 M (36,563), an increase of SEK 11,689 M during 2005. • Net asset value per share on February 14, 2006, was SEK 262, an increase of SEK 12 per share since the start of the year. Net asset value per share on December 31, 2005, was SEK 250 (189). Including reinvested dividends, the increase was SEK 68 per share in 2005. Average annual growth in net asset value over the last ten-year period, including reinvested dividends, was 18%. Earnings per share for 2005 were SEK 73.54 (38.62). • The total return for Industrivärden’s Class A stock was 33%, and the total return for the Class C stock was 36%, compared with 36% for the return index. The average annual total return over the last ten-year period was 6 percentage points higher than the return index. • During the year, Indutrade became listed on the Stockholm Stock Exchange O-List, whereby 63% of the shares were sold. In addition, the entire holding in Ossur was sold. Together Indutrade and Ossur increased Industrivärden’s net asset value in 2005 by SEK 1.4 billion, or slightly more than SEK 7 per share. • During the year shares were purchased for SEK 3.0 billion (5.2) and sold for SEK 4.0 billion (3.0). Shares were purchased in SCA for a net of SEK 1.3 billion. • The Board of Directors proposes a dividend of SEK 7.00 per share (6.00), an increase of 17%. CEO’s Message The global economy performed well in 2005, and the rate of growth was broadly higher than anticipated in major parts of the world economy. At the same time, an adaptation to the record-low short-term interest rates to more normal levels has now been initiated in most major economies. However, due to the absence of clear inflationary tendencies, long-term rates should remain low in a historical perspective. Our equities portfolio performed well during the year. Most of Industrivärden’s portfolio companies have first-rate global market positions and are leaders in their respective industries. This good performance is reflected in our net asset value, which including reinvested dividends rose 37%, or by SEK 68 per share. The total return for Industrivärden’s Class A and C stock was 33% and 36%, respectively. One important event during the year was the introduction of Indutrade on the Stockholm Stock Exchange O-List. The Initial Public Offering was a success and was oversubscribed 12 times, with a subsequent 37% rise in Indutrade’s share price in 2005. Our belief in Indutrade and its future growth opportunities is strong, and we are staying on as a major shareholder. The Indutrade IPO increased our net asset value during the year by SEK 1.2 billion and decreased our net debt by SEK 1.9 billion. In October we sold our entire shareholding in the Icelandic medtech company Ossur, following an approximate 90% growth in value of our original investment since 2002. The sale decreased our net debt by SEK 850 M and generated a capital gain of SEK 398 M. In 2005 we acquired an additional SEK 1.3 billion in stock in our portfolio company SCA, at an average share price of SEK 255. We know the company well and are strongly confident about SCA’s future performance. As a result of the refinement of Industrivärden’s equities portfolio in recent years, today we have an almost fully transparent portfolio in which 99% of the managed value consists of listed equities. At year-end 2005 our net debt was SEK 4.0 billion, and our total equity portfolio were worth SEK 52.3 billion. The net debt-equity ratio was 7%. Earnings from our short-term trading amounted to SEK 122 M and thus amply covered our management costs of SEK 78 M, corresponding to 0.2% of managed assets. The Board’s proposed dividend increase of 17% to SEK 7.00 per share entails that we have once again achieved our goal of paying a dividend that exceeds the average for the Stockholm Stock Exchange. Anders Nyrén President and CEO The complete Year-End Report can be downloaded from Industrivärdens web-page www.industrivarden.net.