Cision Websolutions


Ownership of and investment in AQ is fraught with risks. The company's operations are affected by a number of factors that in some respects not at all, and in other respects not completely controlled by the company. These factors may result in negative impact on the Company's operations. Listed below are a number of risks that may affect the company's future development. The order in which the risks are presented is not an indication of the likelihood that they will occur or how severe they are. The report does not claim to be comprehensive. All factors are described in detail without a complete evaluation must include all the information in this Prospectus as well as a general assessment. Additional risks and uncertainties not currently known to the Company or that the Company currently deems insignificant, could have a significant impact on the Company's business, earnings and / or financial position.


Risks related to operations

Dependency on customers

AQ currently has a number of customers from various industries. Individual subsidiaries within the Group may have a significant customer dependence, which can put pressure on the performance and viability of individual subsidiaries.
There is a risk that AQ has a large share of sales to a few large customers. These large international customers include many global entities that do business with various subsidiaries in the AQ Group. Sales to the Company's largest customer represents 17% of AQ's total turnover in 2018 and is divided into several different subsidiaries at the customer. If any of these major customers would reduce their purchases then it may greatly affect AQ's business, earnings and financial position.

Legal risks related to customer and supplier agreements

In the agreements with the Company's major customers there should be noted that these agreements are customer friendly and in many cases gives the customer the right to remedies becuase of delays, the right to damages for non conforming and delayed products and the right to continued supply for a period of up to 15 years. Some of the customer agreements contains indemnity, for example regarding IPR violations. The company's liability under customer contracts is not always reflected in the commitments in the Company's agreements wih its suppliers. In generally the warranty periods are shorter in the supplier agreements than in the customer agreements.
These discrepancies result in a risk that the Company incur costs that the Company can not pass on to their suppliers. If the risk is realized, this can have an adverse effect on the Company's results and financial position.
Intellectual property rights are not regulated in the supplier agreements, which means that the company's right to the intellectual property rights arising from the delivery of products under one agreement is questionable. If the Company has not ensured their right to these rights, it will be difficult to ensure in the next stage and keep customers harmless for such infringement, which may affect the Company's business, earnings and financial position.
In both customer and supplier agreements, it is common that the Company and it's subsidiaries are listed in the Annex of the Agreement, which may change from time to time, shall be considered as contracting parties in the contract, even though the agreements have not been signed on behalf of these subsidiaries. It is in these cases unclear whether the subsidiaries will be bound by the agreements. In the event that the purchase and the sale under the contract entered into by the Company but actually implemented through the subsidiaries and not a reference to the main agreement is made, there is a risk that the provisions provided by law will be applicable instead of the conditions imposed by the main contract, which may be inferior conditions for the company . If this risk materializes, it could adversely impact the Company's business, earnings and financial position.
Some of the subsidiaries' sales orders and purchase orders does not contain any specific regulations regarding the terms that will regulate the orders. It is therefore unclear what conditions will apply to the relationship between the parties in the respective order. If the principal agreement will not be applicable to orders, the applicable mandatory rules of law which may cause inferior contractual terms and conditions to the Company. If this risk materializes, it could adversely impact the Company's business, earnings and financial position.

Credit risk

The Group's credit risk is primarily related to accounts receivables. AQ's payment terms are often long from customers. It could cause substantial additional costs for the Company if a customer has financial problems and can not meet their payments . Furthermore, there is a credit risk attributable to the customer contracts, in some cases they permit a third party not affiliated to the customer that the third party has the right to order goods and services under the conditions stated in the agreement. The Company can not in these cases control which companies they enter into agreements with and the Company can not check their credit rating. This can in turn lead to increased risk of customer loss, which can affect AQ's result and financial position.

Financing and liquidity risks

Financing and liquidity risk refers to the risk that the refinancing of maturing loans becomes difficult or costly, the financial covenants in its credit and loan agreements can not be met and that payment obligations can not be met due to insufficient liquidity or difficulties in obtaining external financing. This may cause the Company's financial position and earnings adversely affected.


AQ operates in a competitive market. Changes in the competitive environment in the markets where the Group operates may reduce AQ's sales or market share. In the future there may be a risk that the Company is unable to offer attractive products and services at competitive prices in the market. Such a development would risk affecting the Company's earnings.

Market risks

Market risks include the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The market risks that affect the Group are interest rate risk, currency risk and other price risk, such as purchasing and commodity prices.

Interest rate risk

The Group's interest rate risk relates to the Group's funding from credit institutions and resulting from borrowing, which is preferably carried out at a variable rate. Interest expense is affected by the level of current market rates and credit margins and by what strategy the company chooses to hedge interest rates. All financing from credit institutions is done presently floating rate, linked to the bank's base rate is related to the Swedish federal reserve's repo rate. Interest rate increases may affect the Company's earnings. With net debt 2018-12-31 involves a change of 1 percentage point would affect profit by approximately SEK 3.3 million.

Currency risks

The group operates largely in Sweden. The Group also includes subsidiaries in the Euro area and Bulgaria, India, China, Mexico, Hungary, Poland, Serbia, Canada and USA. Most of AQ's foreign currency purchases in EUR, CNY (China), BGN (Bulgaria) and USD. Currency fluctuations may affect the pricing of the Company's products. Furthermore, changes in foreign exchange income statement and balance sheet, as these under applicable accounting rules are valued at market value in the consolidated accounts. The translation of foreign subsidiaries to SEK results in a balance effect. Two currencies are responsible for most of the conversion exposure in 2017, PLN - where a one percent change gives an effect before tax of SEK 0.5 million, and EUR which has a corresponding effect on the result by SEK 0.7 million. Changes in currency exchange rates against the Swedish krona could affect profitability, which in turn affect the Company's financial position and results.

Purchase and commodity price risks

Commodity price risk refers to the change in the price of raw materials and its impact on earnings. For the Group, it is mainly changes in raw material prices that constitutes a commodity price risk. The company's purchase of materials to different processes is significant. The Group depends on deliveries from its suppliers in accordance with agreed requirements relating to for example quality, quantity and delivery time. The group can be adversely affected by its suppliers who cannot supply certain materials on time or if they deliver inferior quality, or face financial, legal or operational problems. There is a risk of sharp price increases for raw materials and the Company may not be able to transfer the price increases to its customers. This may affect the Company's earnings.

Inventories and Obsolescence

The group must have an inventory to deliver to the customer. Inventories can be be subject to obsolescence through a variety of circumstances such as new or changed product design, changed raw material, phase out the product, expired expiration date, etc. . If inventories are not used, there may be substantial additional costs.

Disruptions in production

AQ has a comprehensive process chain, and production units with operations in Bulgaria, Canada, Estonia, Finland, India, Italy, China, Mexico, Poland, Sweden, USA, Hungary, Serbia and Lithuania for manufacturing in various technology areas. Interruption or failure of any process on any of the production sites, caused by for example fire, mechanical breakdown, weather conditions, natural disasters or labor disputes can have a negative effects since it will prevent The Group from fulfilling deliveries to customers which are often dependent on timely deliveries, this may cause additional costs for the Group's business, financial condition and results.


AQ often deliver components and systems with warranty terms of 24 months after the delivery date, or in accordance with what has been agreed. Repair or replacement of defective components occurs if the process differs from what has been agreed, inferior workmanship or faulty fabrication process. For system deliveries, inferior products will need repairs or service, either at the Company or at the customer or end user. In addition, the customer may be entitled to damages. It can mean significant additional costs for AQ which may affect the Company's financial position and earnings.

Key personell

AQ is dependent on a number of existing key personnel, including the CEO. Key persons are of great importance to AQ's future success. AQ's ability to retain these people are dependent on several factors, some of which are beyond the Company's control. It could have great negative effect on the Company's business, financial condition and results if key employees leave the Company and AQ can not attract qualified employees.


AQ is a manufacturing production, technology and logistics partner, which means that AQ is not a product owner. The insurance risk refers to the costs AQ may suffer because of inadequate insurance cover for products, property, business interruption, liability, environmental, transport, life and pensions. The company writes insurance policies within the Group to the extent it is deemed commercially justified. There is a risk that the scope of the Company's insurance coverage does not prove to be enough. If this is the case, it could have a negative impact on AQ's business, financial condition and results.


The Group's operations are dependent on a functioning IT system. Disruptions in IT systems can lead to serious disturbances in the whole business as production loss, loss of orders and invoicing. Disturbance or loss of data may affect the Company's financial position and earnings.


One of the Group's main assets consist of goodwill. This is not subject to scheduled amortization. Instead tested for impairment annually or more frequently if there are indications of significant impairment in accordance with IAS 38. Accordingly, there is a risk of impairment of goodwill in the consolidated balance sheet. If the risk is realized, this means that the Group's financial position deteriorates.

Enviromental risks

Within the Group there are subsidiaries that conducts licensable activities and subsidiaries that conducts notfiable operations. An accident at a licensable subsidiary can affect profitability, which in turn may affect the Company's financial position and results. The Group's operations affect the external environment mainly through transport emissions in the transport of raw materials and components from suppliers to the manufacturing sites and from the sites to the customer, and by products containing environmentally harmful substances and product packaging. Changes in legislation or government regulations involving new or more stringent requirements or changed conditions of health, safety and environment, as well as a trend towards stricter application of laws and regulations, may require additional investment and lead to increased costs and other commitments for the subsidiaries within the Group subject to the regulation. If AQ fails to meet such changes cost-effectively or maintain the necessary permits for the AQ production sites, then the financial position and earnings may be adversely affected. Furthermore, there is a risk that the Group's current and previous activities may have resulted in contamination of land where the business from time to time pursued. Impurities AQ operations caused may result in that the Group will be required to take remediation and other recovery operations, which can have a negative impact on the Group's business, financial condition and results.

Economic cycles and political development

Contract manufacturing and operations on three continents are fairly cyclical and AQ depends on what conditions customers, and to what extent and where they
choose to produce their products. If the political development and economnomic cycle would be negative then that could adversely affect the Company's financial position and earnings.

Tax risks

The Company's operations are conducted in accordance with the Company's interpretation of current tax laws and various tax authorities. There may be a risk that the company's interpretation of applicable laws, rules and practices are incorrect or that such rules may change, possibly with retroactive effect. The tax authority's decision can affect AQs previous or current tax situation, which could have a negative impact on AQ's business, earnings and financial position. The company's tax risks are mainly related to the pricing of intra-group transactions, such as risk of withdrawal taxation in connection with the transfer of the product portfolio as well as deficiencies in the transfer pricing documentation, which may affect AQ's business, earnings and financial position.


Risks related to the shares

Share performance

Securities trading always involves risk and risk-taking. As an equity investment may fall in value, there is no guarantee that an investor will get back all or even parts of the capital invested. In addition, it should be noted that the pricing of the Company's shares is dependent on factors that is outside of AQ's control, including the stock market expectations and development, and economic development in general. Investments in AQ shares should be preceded by a careful analysis of the company, its competitors and the business environment as well as general information about the industry.
An investment in shares should never be seen as a quick way to generate revenue, but rather as an investment that is implemented in the long-term with capital that can be dispensed with. The price of the shares may be subject to fluctuations as a result of a changed perception on the capital market for the shares due to various circumstances and events such as changes in applicable laws and regulations affecting the Company's operations, or changes in the Company's results and business development, such as greater variation in revenue and earnings from year to year due to the tendency of the market. Stock markets may from time to time show significant fluctuations related to price and volume which need not be related to the Company's operations or prospects. In addition, the Company's results and prospects may from time to time be lower than the expectations of the capital markets, analysts or investors. One or more of these factors may result in that the share price falls.

Listing Requirements

The Company's shares are traded on the Nasdaq Stockholm's main market. The Company shares may be delisted in the event that the Company does not henceforth live up to the requirements applicable to companies traded on the Nasdaq Stockholm's main market.

Liquidity in the Company's shares

There is a risk that a liquid trading in the shares is not maintained. The Company can not predict the extent to which investor interest will lead to the development and maintenance of an active and liquid trading market for the shares. If active and liquid trading is not sustainable, it can present difficulties to sell the shares.

The influence of major shareholders

Today's major shareholders in the Company control significant shareholdings in the Company. Thus, these large shareholders may affect the Company regarding, amongst other things, such matters that are subject to a vote at the General Meeting. These major shareholders' interests may differ from the interests of other shareholders. If any major shareholder decides to sell its holding, it may affect the share price negatively.

Offer of shares in the future

The Company may in the future issue shares or other securities, for example,  to be able to do investments. A future issue could affect the share price and may cause the distributable funds per share to decreases. The issue of new shares may also result in dilution for the shareholders who may not have the opportunity to subscribe for shares in the rights issue in proportion to their holdings.

Risks related to dividends

The Company's dividend policy is that the dividend over an economic period will follow the results and correspond to 25 per cent of the company's profit after tax, taking into account the investment needs and financial position of the Company. There is a risk that the Company does not perform a positive result and therefore can not carry out any dividend. There is also a risk that dividends can not be done, despite positive earnings due to investment requirements or financial position. In particular, the financial commitments The company lined up in proportion to their lenders lead to the distribution of profits can not be made despite the positive results.