SKF Half-year report 2009

2009 July 15, 08:00 CET

Tom Johnstone, President and CEO:

 "We had a very strong cash flow in the quarter and overall a good performance in light of the difficult business environment. While the decline in demand was dramatic compared to last year, the sequential trend for the Group shows signs of levelling off. The manufacturing level was even lower than sales resulting in a further reduction in our inventories.

We are already seeing benefits from our cost reduction activities. Additional activities were announced, which combined with steps already taken will result in annualized savings of around SEK 800 million from mid next year.

We expect that the year on year decline in our sales volume in the third quarter will be slightly less than what we have seen in the first half. The manufacturing level will continue to run lower than sales."


Q2 2009
Q2 2008
YTD 2009
YTD 2008
Net sales, SEKm14,16716,07729,01631,673
Operating profit, SEKm4742,1351,2424,175
Operating margin, %3.413.34.313.2
Operating margin excl. restructuring %6.913.36.613.2
Profit before taxes, SEKm3121,9788433,902
Net profit, SEKm3231,3697172,665
Basic earnings per share, SEK0.692.951.555.72
The decrease of 11.9% in net sales for the quarter, in SEK, was attributable to:
volume -30.8%, structure 1.1%, price/mix 5.6% and currency effects 12.2%.

For the first half year, the decrease of 8.4%, in SEK, was attributable to:
volume -28.9%, structure 1.3%, price/mix 6.3% and currency effects 12.9%.

The quarter included expenses for restructuring activities of SEK 500 million of which around SEK 480 million refer to programmes announced in the second quarter. For the first half year the expenses amount to around SEK 675 million.

Outlook for the third quarter of 2009
Compared to last year the demand for SKF products and services is expected to be significantly lower in the third quarter compared to the third quarter last year for the Group in total, for all the Divisions and for all regions.

Compared to the second quarter and adjusted for seasonality, demand is expected to be relatively unchanged for the SKF Group in total. It is expected to be lower in Europe, relatively unchanged in North America and slightly higher in Asia and Latin America. It is expected to be slightly higher for the Automotive Division, relatively unchanged for the Service Division and slightly lower for the Industrial Division.

The manufacturing level will be significantly lower year on year and relatively unchanged compared to the second quarter.


Göteborg, 14 July 2009


Aktiebolaget SKF
(publ.)


Tom Johnstone                                        
President and CEO, Board member


Leif Östling
Chairman
Ulla Litzén
Board member
Winnie Fok
Board member
Hans-Olov Olsson
Board member
Lena Treschow Torell
Board member
Lars Wedenborn
Board member
Peter Grafoner 
Board member
Joe Loughrey
Board member

Lennart Larsson 
Board member
Kennet Carlsson
Board member




AB SKF may be required to disclose the information provided herein according to the Securities Markets Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 08.00 (CET) on 15 July 2009.


Further information can be obtained from:
Ingalill Östman, Group Communication
tel: +46-31-3373260, mobile: +46-706-973260, e-mail: ingalill.ostman@skf.com
Marita Björk, Investor Relations
tel: +46-31-3371994, mobile: +46-705-181994, e-mail: marita.bjork@skf.com

SKF logo