Group

Order intake and revenue

2024 had a mixed demand picture, with regional variations as well as between key customer segments. Demand in the mining segment was stable on a high level, with strong momentum in parts, services and consumables compensating for lower mining equipment investments. On the back of geopolitical and macroeconomic uncertainties, the infrastructure market remained challenging throughout the year, with declining demand in all regions. Lower industrial activity and specific challenges in automotive led to a decline in demand for cutting tools, most notable in Europe. Demand in aerospace was slightly subdued, mainly due to temporary issues in North America during the second half of the year. The powder business developed strongly during the year, and Sandvik software solutions grew mid- to high-single digits. Group volumes were down year on year, partly compensated by good price execution and cost control. The order intake amounted to SEK 124,694 million (125,011), corresponding to an increase of 2 percent at fixed exchange rates, of which organic growth was 1 percent. Revenues amounted to SEK 122,878 million (126,503), a decline by 3 percent, corresponding to a 1 percent decrease at fixed exchange rates, of which organic development was –2 percent. The book-to-bill ratio was 101 percent (99).

Earnings and return

EBITA decreased to SEK 20,493 million (24,530), corresponding to 16.7 percent (19.4) of revenues. The adjusted EBITA decreased to SEK 23,583 (25,240) and the adjusted EBITA margin decreased to 19.2 percent (20.0) compared to the previous year. Changes in foreign exchange rates affected adjusted EBITA negatively by SEK –434 million (601) compared with the preceding year. Net financial items amounted to SEK –1,959 million (–2,623). The result before taxes was SEK 16,461 million (19,794). Income tax had a total impact of SEK –4,216 million (–4,493) on earnings, corresponding to 25.6 percent (22.7) of profit before taxes. Profit for the year attributable to owners of the Parent Company was SEK 12,243 million (15,300). Basic earnings per share amounted to SEK 9.76 (12.20). Return on capital employed was 13 percent (16) and return on equity was 13 percent (18).

Working capital

Relative net working capital for the year was 30 percent (29) of revenues. In absolute terms net working capital amounted to SEK 35,902 million (35,048) at the end of the year. In terms of volume, net working capital decreased by SEK –1,256 million compared with the preceding year. Changed currency rates increased net working capital by SEK 1,519 million compared with the preceding year. The structural effect from acquisitions and divestments increased working capital by SEK 591 million.

Cash flow and financing

Cash flow from operating activities increased to SEK 20,607 million (18,797). Net cash flow after investing activities was SEK 12,936 million (10,293). At the end of the year, cash and cash equivalents amounted to SEK 4,528 million (4,363) and free operating cash flow was SEK 21,194 million (19,582).

Financial net debt was SEK 32,116 million (35,215) and the financial net debt/EBITDA ratio was 1.2 (1.2).

At the end of 2024, Sandvik had unutilized committed credit facilities SEK 11,000 million consisting of a revolving credit facility. The remaining duration for the Group’s outstanding bonds is currently 3.3 years.

According to the international credit-rating agency Standard & Poor’s, Sandvik Group held a long-term rating of BBB+ with a stable outlook at year-end 2024. The rating was changed from A– with negative outlook during the year. The short-term rating is A–2 and K1 on the domestic Nordic scale.

Equity

Equity at year-end amounted to SEK 96,999 million (87,697), or SEK 77.3 per share (69.9). The equity ratio was 53 percent (50).

Investments

Investments in non-current assets for the full year 2024 amounted to SEK 4,841 million (5,354) corresponding to 140 percent of scheduled depreciation. Proceeds from the sale of companies and shares, net of cash, amounted to SEK –22 million (–164). Investments in internally generated intangible assets were SEK 964 million (1,085). Investments in companies and shares, net of cash acquired, amounted to SEK –3,187 million (–1,877).

Acquisitions during the year

In February, Sandvik acquired Pro-micron GmbH, a German-based supplier of sensorized tools and automation software.

In March, Sandvik acquired Cimquest, a US- based reseller of Computer Aided Manufacturing (CAM) solutions and one of the largest resellers in the Mastercam network.

In May, Sandvik acquired Almü Präzisions-Werkzeug GmbH, a Germany-based cutting tools and solutions provider within high-precision drilling, reaming, milling and tooling systems.

In June, Sandvik acquired PDQ Workholding LLC, a leading US-based company specializing in custom workholding fixtures and tooling.

In July, Sandvik acquired the majority stake in Suzhou Ahno Precision Cutting Tool Technology Co., Ltd., a China-based company with leading position in precision cutting tools.

In December, Sandvik acquired Universal Field Robots, a fast-growing Australia-based provider of autonomous interoperable solutions for the surface mining and underground mining markets.

Divestments during the year

In August, Sandvik divested the engineer to-order business of DWFritz.

Parent Company¹⁾

The Parent Company’s revenues for 2024 amounted to SEK 13,427 million (13,705) and the operating result was SEK 793 million (–6,868). The result from shares in Group companies of SEK 9,147 million (12,855) for the year consists mainly of dividends and contributions. Interest-bearing liabilities, less cash and cash equivalents and interest-bearing assets, amounted to SEK 36,753 million (38,011). The Parent Company’s total assets decreased by SEK 3,508 million, from SEK 100,414 million to SEK 96,906 million. Investments in non-current assets amounted to SEK 438 million (384).

The number of employees in the Parent Company and the subsidiaries operating on commission for Sandvik AB as of December 31, 2024, was 3,569 (3,641).

Dividend

The Board of Directors proposes a dividend of SEK 5.75 per share (5.50) to the 2025 Annual General Meeting, corresponding to approximately SEK 7.2 billion (6.9)

Employees

The average number of employees, full-time equivalent, amounted to 41,162 (40,686), of which 21 percent (21) were women. The employee turnover rate was 11 percent (10). Wages, salaries and other remunerations for the year totaled SEK 26,798 million (26,323).

Guidelines for the remuneration of senior executives

The below remuneration guidelines were approved by the Annual General Meeting 2024, and apply until the Annual General Meeting 2028, unless any changes are proposed. The Board of Directors does not propose any new guidelines.

Scope of the guidelines

These guidelines encompass the President and other members of the Group Executive Management. The guidelines do not apply to any remuneration decided on or approved by the General Meeting.

The guidelines’ promotion of the Company’s business strategy, long-term interests and sustainability

A prerequisite for the successful implementation of the Company’s business strategy and safeguarding of its long-term interests, including its sustainability, is that the Company is able to recruit and retain qualified personnel. To this end, it is necessary that the Company offers competitive remuneration. These guidelines enable the Company to offer senior executives a competitive total remuneration. For more information regarding the Company’s business and sustainability strategy, please see the Company’s website: home.sandvik.

Types of remuneration

The total remuneration package should be based on market terms, be competitive and reflect the individual’s performance and responsibilities as well as the Group’s earnings trend. The remuneration may consist of fixed salary, variable remuneration, pension benefits and other benefits.

Fixed salary

The purpose of the fixed salary is to attract and retain senior executives with the right competence for the respective positions. The salary level should be determined by comparing the salary to similarly complex positions within a defined peer group.

Variable remuneration

Variable share related remuneration

The Company may offer long-term share related or share price related remuneration. Such programs are adopted by the General Meeting and are therefore not covered by these guidelines. There are currently ongoing long-term share related incentive programs for senior executives and key employees in the Group. For more information on these programs, see the Company’s website: home.sandvik.

Variable cash remuneration

The Company may offer short or long-term variable cash remuneration. The fulfillment of objectives for awarding such remuneration shall be measured over a period of one to three years. Such remuneration may amount to not more than 75 percent of the fixed annual salary per year.

Variable cash remuneration shall be conditional upon the fulfillment of defined and measurable criteria. These criteria shall aim at promoting the Company’s business strategy and performance as well as its long-term interests, including its sustainability. At the beginning of each year the Board of Directors and the Remuneration Committee shall establish the criteria, including key performance indicators (KPIs) and the target ranges, deemed relevant for the upcoming measurement period. The criteria may be financial, with at least three KPIs, and non-financial, and shall always be related to business performance. At least 80 percent of the variable cash remuneration shall be linked to the financial criteria. The President and Group Function heads shall be measured on Group level KPIs and the Business Area Presidents shall be measured on both Group level and Business Area level KPIs. The established KPIs shall be presented on the Company’s website: home.sandvik. The extent to which the criteria for awarding variable cash remuneration have been fulfilled shall be determined when the measurement period has ended and will be published in the Report on Evaluation of Remuneration the following year. For financial criteria, the evaluation shall be based on the latest financial information made public by the Company.

Special arrangements

In specific cases, the Company may offer one-off remuneration provided that such remuneration is only made on an individual basis, for the purpose of recruiting or retaining senior executives, does not exceed an amount corresponding to 100 percent of the individual’s fixed annual salary and maximum variable cash remuneration, and is not paid more than once per year and individual.

Right to withhold or reclaim remuneration

Terms and conditions for variable remuneration shall be designed so that the Board of Directors (i) has the right to limit or refrain from payment of variable remuneration if exceptional economic circumstances prevail and such a measure is considered reasonable, and (ii) has the right to withhold or reclaim variable remuneration paid to an executive based on results that afterwards were found to have been misstated because of wrongdoing or malpractice (so called malus and clawback).

Pension benefits

For the President, the pension benefit shall be defined contribution and the pension premiums shall amount to not more than 37.5 percent of the fixed annual salary. For the other senior executives, pension benefits shall be defined contribution and amount to not more than 35 percent of the fixed annual salary.

Other benefits

Other benefits may include, for example, life insurance, medical insurance and company car benefit. Such benefits may amount to not more than 5 percent of the fixed annual salary. For senior executives in need of double accommodation, paid accommodation, etc. may be added in line with Sandvik’s regulations and such benefits may amount to not more than 20 percent of the fixed annual salary.

Termination of employment

Severance pay may be paid when employment is terminated by Sandvik. The President and the other senior executives may have a period of notice of not more than 12 months, in combination with severance pay corresponding to 6–12 months fixed salary. When employment is terminated by the senior executive, the notice period may not exceed six months and no severance pay shall be paid.

In case a senior executive is not entitled to severance pay, but is covered by a non-compete undertaking, the senior executive may instead be compensated for such a non-compete undertaking. Any remuneration paid as compensation for a non-compete undertaking shall not exceed 60 percent of the fixed salary at the time of notice of termination of the employment and shall not be paid for a longer period than 18 months. Fixed salary during the notice period together with any compensation for the non-compete undertaking shall not exceed an amount equivalent to the senior executive’s fixed salary for 24 months.

Consideration of remuneration to the Company’s employees

When preparing the proposal for these guidelines, the employment conditions applied within the Company as a whole have been used as a benchmark, following the principle that the remuneration packages of all Sandvik employees should be based on the complexity of the position, performance and market practice. In general, the same combination of remuneration components such as fixed salary, variable remuneration, pension and other benefits are offered within Sandvik.

The decision-making process to determine, review and implement the guidelines

The Board of Directors has established a Remuneration Committee. The Committee’s tasks include preparing the Board of Directors’ decision to propose guidelines for senior executive remuneration. The Board of Directors shall prepare a proposal for guidelines at least every fourth year and submit it to the General Meeting. The guidelines shall be in force until new guidelines are adopted by the General Meeting. The Remuneration Committee shall also monitor and evaluate programs for variable remuneration for the executive management, the application of the guidelines for senior executive remuneration as well as the current remuneration structures and compensation levels in the Company. The members of the Remuneration Committee are independent of the Company and its executive management. The President and the other senior executives do not participate in the Board of Directors’ processing of and resolutions regarding remuneration-related matters to the extent that they are affected by such matters.

Decisions on remuneration to the President are taken by the Board of Directors, based on proposals from the Remuneration Committee, and decisions on remuneration to the other senior executives are taken by the Remuneration Committee.

Adjustments to local rules

Remuneration under employments subject to other rules than Swedish may be duly adjusted to comply with mandatory rules or established local practice, taking into account, to the extent possible, the overall purpose of these guidelines.

Derogation from the guidelines

The Board of Directors may temporarily resolve to derogate from the guidelines, in whole or in part, if in a specific case there is special cause for the derogation and a derogation is necessary to serve the Company’s long-term interests, including its sustainability, or to ensure the Company’s financial viability. As set out above, the Remuneration Committee’s tasks include preparing the Board of Directors’ resolutions in remuneration- related matters. This includes any resolutions to derogate from the guidelines.

For information concerning the current remuneration of senior executives, including ongoing long-term incentive programs, refer to note G4.

Research and development (R&D)

Each business area is responsible for its own R&D activities. Focus areas are machining materials and process development, powder metallurgy, electrification and digital solutions.

Sandvik has a portfolio of 8,264 (6,921) active patents. In 2024, 1,157 (722) new patents were granted. The increase of active and granted patents is partly due to use of European Patents with unitary effect, so called Unitary Patents, which cover a large number of countries. Investments in R&D were SEK 5,053 million (4,803), corresponding to 4.1 percent (3.8) of revenues. The number of employees in R&D, including Quality Assurance, was 3,075 (3,134).

Tax

Sandvik is a multinational group with many intercompany transactions. The OECD has issued guidelines for transfer pricing of cross-border transactions in multinational groups. Sandvik adheres to these guidelines and also to the local legislation of each country to ensure that a correct pricing model is deployed and that a correct amount of tax is paid in each country. Sandvik monitors the OECD’s tax reform work and the EU initiatives on tax transparency carefully and observes these standards as and when enacted. Sandvik strives to have good relations with our stakeholders, such as tax authorities, non-governmental organizations and investors.

Sandvik has initiated cooperation with tax authorities in several countries. We are convinced that an open discussion and cooperation with tax authorities around the globe will help us to reduce uncertainty about the taxes we are obliged to pay. We contribute to the local communities and countries in which we operate in the form of, for example, taxes and employment opportunities. In 2024, the Group paid SEK 5,474 million (6,852) in income taxes globally. Income tax comprises just a portion of all taxes paid by Sandvik worldwide. In addition, we pay social security contributions, environmental and energy taxes, property taxes, etc. Furthermore, Sandvik collects and pays taxes at the request of governments and authorities, including indirect taxes and withholding taxes.

Environment

In Sweden, Sandvik operates under licenses at eight sites in accordance with the Swedish Environmental Code, with each site holding the necessary environmental permits. During the year, there were a couple minor environmental incidents, along with a bigger oil spill and one exceedance of regulatory limits. All incidents were managed in consultation with the respective local supervisory authorities. In 2023, Sandvik Rock Tools in Sandviken applied for new permits, and the permit process was still ongoing at the end of 2024.

Statutory sustainability report

Sandvik has, in accordance with the Annual Accounts Act, prepared a statutory sustainability report, approved for issue by the Board of Directors and the President and CEO. The Statutory Sustainability Report and Sustainable Business Report comprise pages About Sandvik, Sustainability targets, Shift to growth, Risk management, Non-financial notes.

Events after the end of the period

On January 3, 2025, Sandvik acquired the assets of FASTech, a US based reseller of Computer Aided Manufacturing (CAM) solutions in the Mastercam network.

On January 10, 2025 Sandvik announced that Åsa Thunman, Executive Vice President and General Counsel of Sandvik, had decided to leave the company. The recruitment process to find a successor is under way.

On February 3, Sandvik acquired ShopWare, MCAM Northwest and the CAD/CAM solutions business line of OptiPro Systems, three US-based resellers of CAM solutions in the Mastercam network.

On March 3, 2025 Sandvik acquired three US-based resellers of CAM solutions in the Mastercam network, Barefoot CNC, CAD/CAM Solutions and CamTech Engineering Services. Additionally, Sandvik acquired the probing and post processor business lines of CIMCO Group, a Denmark-based developer of software solutions for computer-integrated manufacturing.