Opus Group. Equity Research. US could be supportive. Buy (Neutral) Target price: SEK 9.00 (10.0) Share price: SEK August, 2015.

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1 Equity Research 21 August, 20 Opus Group US could be supportive Q2 EBITDA slightly better than expected US platform in place Relative pricing in favor Q2 figures The Q2 EBITDA of SEK 94m (88) was 2-3% above our forecast. The y/y improvement reflects the USD appreciation, which offsets the higher costs generated by the change in the business model in California, and the loss of volumes in British Columbia and Colorado. In Sweden, Opus improved its EBITDA by around % y/y. The new IT system is in place, and Opus has regained some market share. In addition, price increases have been supportive. The financial net reflected a currency effect of SEK -38m, which can be compared to the positive impact of SEK 52m seen in Q1. The effect was the result of the weaker USD in Q2. US platform in place Opus s US contract portfolio seems solid enough, with the major contracts being boxed in for an extended period. In the longer term, tougher US emission standards will require more states to implement vehicle inspections. The Missouri contract has been awarded to a competitor. However, there will be protests, as the procurement standards were changed during the process. We therefore believe Opus will probably retain the contract, at least in the short term. Attractively priced The share received a beating following publication of the Q2 report, which was slightly ahead of our estimates. Even though we trim our forecasts somewhat, we believe opportunities are in place and we expect earnings to improve. The share is trading at a discount to peers. We upgrade our recommendation to Buy (Neutral) with a target price of SEK 9 (). Key figures (SEKm) e 2016e 2017e Net sales 469 1,047 1,458 1,652 1,621 1,800 EBITDA EBITDA Earnings before tax EPS (recurring) EPS (earnings per share) Dividend per share Dividend yield 0.8% 0.4% 1.0% 1.6% 2.0% 2.5% Net sales-growth 3.9% 123.4% 39.2% 13.3% -1.9% 11.0% EPS-Growth (recurring) nm nm 121.2% -21.3% 36.6% 33.9% EBITDA-margin.6%.4% 17.6% 21.3% 24.9% 25.3% EBIT-margin 3.0% 12.6%.9% 11.8% 16.0% 18.1% Net debt/ebitda ratio EV/Sales EV/EBITDA EV/EBIT nm P/E (recurring) nm nm P/E nm nm FCF-yield 6.9% 2.4% 0.1% 5.0% 6.8% 12.4% FCF / Net Profit % 9.7% 1.1% 116.3% 3.4% 0.8% Note: EBIT, EBITDA is excl. income from associated comp and non-recurring items. Estimate changes Performance Q2 report 20Q4E Mats Liss Swedbank Research , mats.liss@swedbank.se Andrej Rodionov, CFA Swedbank Research , andrej.rodionov@swedbank.lt Buy (Neutral) Target price: SEK 9.00 (.0) Share price: SEK e 2016e 2017e Net sales -0.4% -7.2% -6.6% EBITDA 2.5% -8.4% -7.1% EPS (recurring) -6.3% -11.8% -8.6% Aug Oct Dec Feb Apr Jun Aug Opus Group OMXSPI Peers -1m -3m -12m Absolute -6.9% -17.7% -39.9% vs. OMXSPI -0.6% -12.6% -47.4% Rel. peers -4.6% -.0% -41.9% High Low Technology Date for prices 20 Aug 20 17:30 Date for input-data 21 Aug 20 Next report 20 November 20 Reuters/Bloomberg OPUS.ST/OPUS@SS No of shares (m) 287 Avg. turnover(sekm) 5.36 Free float (%) 85.0% Mcap(SEKm) 2,201 Mcap(EURm) 231 EV(SEKm) 2,892 BV/share 20e 3.38 P/BV 20e 2.41 ROE 20e 12.6% ROCE 20e 9.9% ROIC 20e 25.6% Equity ratio 20e 39.3% CAGR Net sales % CAGR EBT % CAGR EPS % August 21, 20 Please see importantdisclosures at the end of thisdocument Page 1 of 9

2 Forecast and outcome Q2 20 SWB % div. SME % div. Q2 20 % div. Sales % n.m % n.m % n.m. EBITDA-reported % % 89 EBITDA -margin 20.8% 20.0% 18.5% 22.0% EBIT - reported % % % EBIT -margin 12.1% 11.6% 9.9%.6% EBIT - adjusted (1) % % % EBIT -margin 12.1% 11.6% 0 n.m. 9.9% 0 n.m..6% 0 n.m. PTP - reported % % % PTP - adjusted (1) % n.m % n.m % n.m. EPS - reported % % % EPS - adjusted (1) % % % (1) Excl e o items Outcome SWB % div. SME % div. Q2 20 % div. Sales Equipment % #DIV/0! % Vehicle Inspection (International) % #DIV/0! % Vehicle Inspection (Sw eden) % #DIV/0! % Group & Eliminations ,578-6 Sales % % % EBITDA 0 0 Equipment % #DIV/0! % EBIT-margin 1.5% 5.1% #DIV/0! 6.8% Vehicle Inspection (International) % #DIV/0! % EBIT-margin 23.5% 23.1% #DIV/0! 25.3% Vehicle Inspection (Sw eden) % #DIV/0! 34.0% EBIT-margin 22.2% 19.0% #DIV/0! 20.7% Other EBITDA % % % EBITDA-margin 20.8% 20.0% 9.9%.6% Source:Swedbank, Opus, SME Sales declined by 2.5% to SEK 452m adjusted for FX and acquisitions, which was slightly behind our forecast. The main reason behind the negative organic growth is the close down of vehicle inspection in British Columbia and Colorado. The EBITDA amounted to SEK 94m, which was an improvement compared to last years SEK 88m. The improvement is due to the strengthening of USD, while upfront sales commissions in California, British Columbia and Colorado had a negative impact. The financial net was negatively impacted by SEK 38m since the USD lost some momentum during the 2 nd quarter. During Q1 the positive impact was SEK 52m. Opus has a net claim of USD 90m. The impact will be limited during the balance of the year. August 21, 20 Please see importantdisclosures at the end of thisdocument Page 2 of 9

3 Company description Opus Group operates vehicle inspection programs, which accounts for about 91% of the company s turnover. Vehicle Inspection Sweden consists of Opus Bilprovning, with 74 vehicle inspection stations. Vehicle Inspection International operates vehicle inspection programs and offers emission control equipment sales and servicing to the North American and South American markets. The Group also develops, produces and sells equipment and IT systems for the vehicle inspection industry. Net sales per business area 20 EBITDA per business area 20 Group & Eliminations, 0% Equipment (Europe & Asia), 9% Group & Eliminations, -3% Equipment (Europe & Asia), 3% Vehicle Inspection (Sweden), 37% Vehicle Inspection (International), 52% Vehicle Inspection (Sweden), 31% Vehicle Inspection (International), 63% Source: Swedbank Research and Opus Group Source: Swedbank Research and Opus Group EBITDA-margin vs. EV/Net sales Net sales and EBITDA-margin , ,600 1,400 1,200 1, e 2016e 2017e e 2016e 2017e EV / SALES EBITDA Marg (%) Net sales (SEKm) EBITDA Marg (%) Source: Swedbank Research and Opus Group Source: Swedbank Research and Opus Group Other company information CEO CFO IR Magnus Greko Annica Lindström Peter Stenström Homepage Phone Address Bäckstensgatan 11C, SE Mölndal, Sweden Annual General Meeting 21 April 20 Dividend settlement day 22 April 20 Source: Opus Group Shareholders Votes Capital AB Kommandoran.6%.6% Lothar Geilen 6.7% 6.7% Andra AP-fonden 6.5% 6.5% Invesco Funds 4.3% 4.3% SHB Funds 3.1% 3.1% Avanza Pension Insurance 3.1% 3.1% Schroder Investment Mgmt 2.9% 2.9% Foreign shareholders na na Free float 85.0% 85.0% Votes/Share - A/B na na Source: SIS Ägarservice and Opus Group August 21, 20 Please see importantdisclosures at the end of thisdocument Page 3 of 9

4 Quarterly data Quarterly data (SEKm) Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 Q2 20 Q3 20e Q4 20e Net Sales EBITDA EBITA EBIT Non recurring items Operating earning Earnings from shares in associated comp Net financial items Earnings before tax (reported) Earnings before tax (recurring) na na na na na na na na Tax Minority share in net earnings Net earnings (reported) Net earnings (recurring) Net earnings (adjusted excl. goodwill depr.) EPS (recurring) EPS (reported) Tax rate 29.3% 24.7% 17.4% 25.2% 20.0% 229.2% 28.0% 28.0% Net sales Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 Q2 20 Q3 20e Q4 20e Equipment (Europe & Asia) na na Vehicle Inspection (International) Vehicle Inspection (Sweden) Group & Eliminations Group total EBITDA Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 Q2 20 Q3 20e Q4 20e Equipment (Europe & Asia) na na Vehicle Inspection (International) Vehicle Inspection (Sweden) Group & Eliminations Group total EBITDA-margin Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 Q2 20 Q3 20e Q4 20e Equipment (Europe & Asia) 3.0% 6.7% 6.4% 6.8% 6.5% 1.5% na na Vehicle Inspection (International) 21.6% 25.4% 21.7% 18.9% 19.6% 24.6% 28.9% 28.0% Vehicle Inspection (Sweden) 12.9% 20.6% 12.4%.1% 9.5% 22.2% 17.1% 17.4% Group & Eliminations 17.7% 21.5% 38.1% 76.8% 19.6% 43.0% 61.6% 64.0% Group total.3% 22.0% 17.4%.1%.9% 21.4% 24.8% 23.9% Growth Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 Q2 20 Q3 20e Q4 20e Net sales 30.8% 57.8% 42.0% 27.6% 34.8% 11.8% 7.2% 4.3% EBITDA 69.6% 90.4% 43.5% 33.4% 32.0% 9.2% 53.1% 65.7% EBITA 89.1% 60.2% -4.4% -26.9% -36.4% -8.4% 60.3% 113.6% EBIT 89.1% 60.2% -4.4% -26.9% -36.4% -8.4% 60.3% 113.6% Earnings before tax (recurring) na na na na na na na na EPS (recurring) 8.5% 113.7% 72.5% 224.7% 7.5% nm -47.8% -3.1% EPS (reported) 8.5% 113.7% 72.5% 224.7% 7.5% nm -47.8% -3.1% August 21, 20 Please see importantdisclosures at the end of thisdocument Page 4 of 9

5 Income statement Income Statement (SEKm) e 2016e 2017e Net Sales ,047 1,458 1,652 1,621 1,800 Other operating income Operating expenses ,201-1,301-1,218-1,344 Cost of goods sold R&D expenses Sales expenses Administration expenses Other operating expenses ,2-1,307-1,224-1,350 Reversals EBITDA Depreciation (tangible fixed assets) EBITA Goodwill amortization Development and amortization EBIT Write-downs Capital gain Restructuring expenses and provisions Other non-recurring items Operating earning Earnings from shares in associated comp Net interest income Financial income Financial expenses Other financial income and expenses Earnings before tax (reported) Earnings before tax (recurring) Tax on earnings for the year Minority share in net earnings Net earnings (reported) Adjustments Net earnings (recurring) Net earnings (adjusted excl. goodwill depr.) EPS (recurring) EPS (reported) Tax rate 0.2% nm 79.2% 31.7% 23.2% 26.6% 28.0% 28.0% Net sales e 2016e 2017e Equipment (Europe & Asia) na na na na Vehicle Inspection (International) na na ,042 1,048 1,164 Vehicle Inspection (Sweden) na na Group & Eliminations na na Group total ,047 1,458 1,652 1,621 1,800 EBITDA e 2016e 2017e Equipment (Europe & Asia) na na na na Vehicle Inspection (International) na na Vehicle Inspection (Sweden) na na Group & Eliminations na na Group total August 21, 20 Please see importantdisclosures at the end of thisdocument Page 5 of 9

6 Balance sheet & Cash flow Balance sheet (SEKm) e 2016e 2017e Goodwill Other intangible fixed assets Tangible fixed assets Shares in associated companies Other financial fixed assets Other fixed assets Total fixed assets ,643 1,901 1,797 1,712 Inventories Current receivables cash and short term investments Total current assets Total assets ,358 2,327 2,461 2,408 2,327 Shareholders' equity ,084 1,244 Minority holdings Covertible debt Long term interest bearing liabilities Pension provisions Tax provisions Other provisions Current interest bearing liabilities Accounts payable Other liabilities Total shareholder's eq. and liabilities ,358 2,327 2,461 2,408 2,327 Net debt Capital employed ,001 1,703 1,897 1,938 1,823 Invested capital Invested capital (excl Goodwill) Change interest-bearing net debt Net debt/equity ratio 17.3% 8.1% 121.0% 17.8% 6.7% 71.4% 52.6% 26.3% Equity ratio 72.5% 73.4% 28.3% 34.3% 27.4% 39.3% 45.0% 53.4% Cash flow (SEKm) e 2016e 2017e Operating earnings Depreciation Non cash items Net Financial items Tax paid Cash flow before chg in working cap Change in working capital Cash flow from ongoing operations Investments in tangible fixed assets Investments in intangible fixed assets Divestitures of fixed assets Free cash flow Divestures of financial fixed assets Investments and disposals net Cash flow after investments Dividends to shareholders New shares issues and repurchases change in interest bearing debt Other sales Change in liquid assets Cash flow drivers e 2016e 2017e D+A / Sales.9%.0% 7.6% 2.9% 6.7% 9.5% 8.9% 7.3% Capex / Sales 3.7% 1.6% 2.2% 1.6% 11.0% 4.5% 2.5% 2.5% Working capital / Sales 18.1% 17.7% -4.6% -2.0% -5.0% 1.1% 7.3% 6.6% Tax rate 0.2% nm 79.2% 31.7% 23.2% 26.6% 28.0% 28.0% August 21, 20 Please see importantdisclosures at the end of thisdocument Page 6 of 9

7 Key ratios and share data Key figures (SEK) e 2016e 2017e EPS (recurring) EPS (reported) Cash flow from operations Free cash flow Enterprise value (EV) ,112 3,220 3,030 2,908 2,664 Book value (BV) Book value (excl. goodwill) nm nm Dividend Dividend yield 0.0% 2.5% 0.8% 0.4% 1.0% 1.6% 2.0% 2.5% Share data (SEK) e 2016e 2017e End year price Price year high na na Price year low na na No of shares (fully diluted, millions) No of shares (average, millons) Valuation e 2016e 2017e EV/Sales EV/EBITDA EV/EBIT nm nm nm P/E (adjusted, end of period) nm nm nm nm P/E (adjusted, high) nm nm nm nm na na P/E (adjusted, low) nm nm nm na na P/E nm nm nm nm P/BV P/BV (excl. goodwill) nm nm FCF-yield 12.0% 17.8% 6.9% 2.4% 0.1% 5.0% 6.8% 12.4% Growth e 2016e 2017e Net sales 6.0% 1.3% 3.9% 123.4% 39.2% 13.3% -1.9% 11.0% EBITDA 42.5% -.6% 60.4% 224.2% 58.6% 37.1%.9% 13.0% EBIT -17.0% nm nm nm 20.4% 22.8% 33.1% 25.6% Pre tax profit (recurring) nm nm nm nm 78.3% -20.1% 36.6% 33.9% EPS nm nm nm nm 121.2% -24.8% 43.0% 33.9% EPS (recurring) nm nm nm nm 121.2% -21.3% 36.6% 33.9% P&L Drivers e 2016e 2017e Gross margin nm nm nm nm nm nm nm nm EBITDA margin 16.2% 13.5%.6%.4% 17.6% 21.3% 24.9% 25.3% EBIT margin 0.4% -0.5% 3.0% 12.6%.9% 11.8% 16.0% 18.1% Pre tax margin -4.4% -2.0% -2.3% 8.6% 12.7% 8.3% 13.1%.8% Net margin -4.4% -2.2% -0.5% 5.9% 9.8% 6.1% 9.5% 11.4% Net margin (recurring) -4.4% -2.2% -0.5% 5.9% 9.8% 6.4% 9.5% 11.4% Cash flow drivers e 2016e 2017e D+A / Sales.9%.0% 7.6% 2.9% 6.7% 9.5% 8.9% 7.3% Capex / Sales 3.7% 1.6% 2.2% 1.6% 11.0% 4.5% 2.5% 2.5% Working capital / Sales 18.1% 17.7% -4.6% -2.0% -5.0% 1.1% 7.3% 6.6% Tax rate 0.2% nm 79.2% 31.7% 23.2% 26.6% 28.0% 28.0% Capital Efficiency e 2016e 2017e FCF/Sales 6.8% 13.8% 9.6% 9.3% 0.1% 7.1% 9.8% 16.1% ROA -1.9% -1.0% -0.1% 8.4% 6.5% 7.2%.9%.2% ROCE -1.9% -1.2% -0.2% 13.6% 11.1% 9.9% 13.7% 17.6% ROIC 0.5% -0.6% 8.9% 113.7% 41.6% 25.6% 31.2% 41.4% ROE -3.8% -2.1% -0.9% 16.8% 25.7% 12.6%.9% 17.6% ROE (recurring) -3.8% -2.1% -0.9% 16.8% 25.7% 13.2%.9% 17.6% Balance sheet (SEKm) e 2016e 2017e Net debt Capital employed ,001 1,703 1,897 1,938 1,823 Invested capital Net debt/equity ratio 17.3% 8.1% 121.0% 17.8% 6.7% 71.4% 52.6% 26.3% Net debt/ebitda ratio Equity ratio 72.5% 73.4% 28.3% 34.3% 27.4% 39.3% 45.0% 53.4% Net interest cover neg. neg. neg August 21, 20 Please see importantdisclosures at the end of thisdocument Page 7 of 9

8 Relative valuation Price Market cap EV/Sales EV/EBIT P/E (recurring) Peer group 1 (Local) (SEKm) AF SEK 8, Bureau Veritas SA EUR 86, Intertek Group 2,580 GBP 55, Pöyry 3.83 EUR 2, nm Rejlers SEK 1, SGS SA 1,735 CHF 119, Sweco SEK 9, Aggr 282, Median 9, Opus Group (Swb. est.) Opus Group (Consensus est.) August 21, 20 Please see importantdisclosures at the end of thisdocument Page 8 of 9

9 Relative performance Price Market cap Absolute vs. OMXSPI vs. SX9500PI Peer group 1 (Local) (SEKm) 1m 3m 1y 1m 3m 1y 1m 3m 1y AF SEK 8, % 2.6% 3.8% 0.1% 9.0% -9.2% 3.5% 13.6% 0.3% Bureau Veritas SA EUR 86, % -1.1% 7.2% 3.3% 5.1% -6.2% 6.9% 9.5% 3.7% Intertek Group 2,580 GBP 55, % 0.4% 5.5% 13.5% 6.6% -7.7% 17.4% 11.1% 2.0% Pöyry 3.83 EUR 2,8 3.7% -1.6% 11.3%.6% 4.5% -2.6%.4% 8.9% 7.6% Rejlers SEK 1, % -12.4% 1.3% 0.9% -7.0% -11.4% 4.4% -3.0% -2.0% SGS SA 1,735 CHF 119, % -6.8% -0.6% 1.2% -1.0% -13.1% 4.7% 3.2% -3.9% Sweco SEK 9, % 0.9% 11.8% 2.3% 7.1% -2.2% 5.8% 11.7% 8.1% Opus Group 8.SEK 2, % % % - 0.6% % % 2.8% - 8.9% % Technology (SX9000PI) -9.4% -9.7% 3.4% -3.3% -4.1% -9.5% 0.0% 0.0% 0.0% Technology (SX9500PI) -9.4% -9.7% 3.4% -3.3% -4.1% -9.5% Company vs. peers (SEK) Company vs. benchmarks (SEK) Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Opus Group Opus Peer1 Opus Group OMXSPI Technology (SX9500PI) August 21, 20 Please see importantdisclosures at the end of thisdocument Page 9 of 9