Tom Johnstone, President and CEO:
"The financial uncertainty and lack of confidence in the market place increased during the quarter and this impacted our sales particularly in Europe and in Asia. The weaker demand which we saw in Southern Europe at the start of the year continued and we also saw softening in some other parts of Europe. In Asia our sales did not develop as expected while we saw continued good growth in both North America and Latin America.
We adjusted our manufacturing during the quarter to reflect the demand situation and to avoid building inventory and as expected this impacted our results. Steps were also announced to adjust our manufacturing cost base in Europe and this we will continue to work on.
The SKF BeyondZero portfolio of solutions was launched and will help our customers reduce their energy cost and impact on the environment. In addition we announced our new climate targets and joined the WWF Climate Savers programme.
Going forward, while it is likely that the uncertainty in the market will remain, we expect demand for the Group in the third quarter to continue at the present good level."
Sales in local currency in the second quarter compared to the same period last year (excl. structure)
Sales for the Group were relatively unchanged. In Europe they decreased by 3.4% and in Asia by 7.9%. In North America they increased by 8.5% and in Latin America by 16.6%. In Middle East and Africa they were relatively unchanged.
The manufacturing level was significantly lower than in the second quarter last year.
One-time costs
The quarter included one-time costs of around SEK 140 m mainly due to steps taken to reduce the cost base in Germany.
Outlook for the third quarter of 2012
Demand compared to the third quarter last year
The demand for SKF's products and services is expected to be relatively unchanged for the Group. It is expected to be lower in Europe, relatively unchanged in Asia, higher in North America and slightly higher in Latin America. The demand is expected to be slightly higher for Industrial Strategic Industries and
relatively unchanged for Automotive and Industrial Regional Sales and Service.
Demand compared to the second quarter 2012
The demand for SKF's products and services is expected to be relatively unchanged for the Group. It is expected to be slightly lower in Europe, relatively unchanged in Asia and North America and higher in
Latin America. The demand is expected to be relatively unchanged for Industrial Strategic Industries
and Industrial Regional Sales and Service and slightly lower for Automotive.
Manufacturing level
The manufacturing level is expected to be lower year on year and slightly lower compared to the second quarter.
Gothenburg, 17 July 2012
Aktiebolaget SKF
(publ.)
Tom Johnstone
President and CEO
AB SKF is required to disclose the information provided herein pursuant to the Securities
Markets Act and/or the Financial Instruments Trading Act. The information was submitted
for publication at 08.00 on 18 July 2012.
A teleconference will be held on 18 July 2012 at 09.00 CET, 08.00 (UK):
SE: +46 (0)8 5055 9853
UK: +44 (0)203 043 2436
You will find all information regarding SKF Half-year results 2012 on the IR website.
investors.skf.com/quarterlyreporting
Further information can be obtained from:
Ingalill Östman, Group Communications
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
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