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SKF Half-year Report 2017

2017-07-21 15:49
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GOTHENBURG, Sweden, July 21, 2017 /PRNewswire/ -- Alrik Danielson, President and CEO:

"The second quarter saw strong organic growth and an improved operating margin. Sales development was positive in all regions, as underlying industrial activity and investments increased.

Net sales, at SEK 20.2 billion, increased organically by 7.5% compared to the second quarter last year, with North America and Asia growing by double-digits, 10% and 12% respectively.

Improved sales volumes and factory utilization rates contributed to an adjusted operating profit of SEK 2,436 million, 416 million higher than last year and an adjusted operating margin of 12%.

The automotive business developed in a solid manner, with a good operational improvement, delivering an adjusted operating margin of 8.1%. The industrial business delivered an adjusted operating margin of 13.8%.

Our underlying cash flow generation ability is robust, at SEK 2.3 billion in the quarter. We continued to focus on our core bearing business, with the divestment of Reelcraft completed in June, which impacted cash flow positively by SEK 892 million. In total, we have now raised approximately SEK 5 billion from divestments in the last two years.

A few weeks ago we inaugurated the Sven Wingquist Test Center for large-size bearings in Schweinfurt, Germany.  The center is the first in the world that can test large-size bearings -- with a diameter of up to six metres -- under dynamic loading conditions, simulating actual operating conditions, making customer development processes faster and more reliable. This is just one example of how we are investing in the development of software and hardware that support product and rotating equipment performance, our two value propositions in key industries. 

As we move into the second half of the year, we expect to see continued broad-based industrial activity and growth.

For the third quarter of 2017, demand for our products and services is expected to be higher compared to the same period last year."

Key figures, SEKm

Q2 2017

Q2 2016

H1 2017

 

H1 2016

Net sales*

20,229

18,319

39,830

35,995

Adjusted operating profit**

2,436

2,020

4 793

3,992

Adjusted operating margin, %**

12.0

11.0

12.0

11.1

Items affecting comparability**

-121

-145

-183

-242

Operating profit

2,315

1,875

4,610

3,750

Operating margin, %

11.4

10.2

11.6

10.4

Adjusted profit before taxes**

2,178

1,801

4,365

3,556

Profit before taxes

2,057

1,656

4,182

3,314

Net cash flow after investments before financing

2,304

4,225

2,368

4,735

* Cash discounts are from January 1, 2017 classified as a reduction of Net sales. Previously published figures have been restated accordingly.

** Please see page 17 of report for definitions 

Net sales change y-o-y, %

Organic

Structure

Currency

Total

Q2 2017

7.5

-2.0

4.9

10.4

H1 2017

7.7

-2.0

5.0

10.7

 

Organic sales change in local currencies,

per region y-o-y, %

Europe

North

America

Latin

America

Asia

Middle East

& Africa 

Q2 2017

3.1

10.0

9.9

11.7

13.3

H1 2017

4.1

8.9

10.6

12.2

11.5

Outlook for the third quarter 2017

Demand compared to the third quarter 2016

The demand for SKF's products and services is expected to be higher for the Group, including Industrial and Automotive. Demand is expected to be higher in Europe, North America and in Asia and significantly higher in Latin America.

Demand compared to the second quarter 2017

The demand for SKF's products and services is expected to be lower for the Group and Industrial and slightly lower for Automotive. Demand is expected to be significantly lower in Europe and relatively unchanged in North America, Asia and in Latin America.

A teleconference will be held on 21 July 2017 at 09:00 (CET):

SE: +46(0)8-5033-6539
UK: +44(0)20-3427-1912
US: +1-646-254-3360

You will find all information regarding the SKF Half year report 2017 on the IR website.

Aktiebolaget SKF
(publ)

The information in this press release is information which AB SKF is required to disclose under the EU Market Abuse Regulation (EU) No 596/2014. The information was provided by the above contact persons for publication on 21 July 2017 kl. 08.00 CET.

For further information, please contact:

PRESS:
Theo Kjellberg
Director, Press Relations
Tel: +46-31-337-6576
Mobile: +46-725-776576
e-mail: theo.kjellberg@skf.com

INVESTOR RELATIONS:
Patrik Stenberg
Head of Investor Relations
+46-31-337-2104
+46-705-472-104
patrik.stenberg@skf.com

This information was brought to you by Cision http://news.cision.com
http://news.cision.com/skf/r/skf-half-year-report-2017,c2314722

The following files are available for download:

Source: SKF

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