SKF Q1 results Alrik Danielson, President and CEO

Transcription

1 SKF Q1 results 2018 Alrik Danielson, President and CEO

2 A record start to 2018 Record-high sales of 20,560 M, organic growth +7.5% 7.5% Organic sales growth Record-high reported operating profit 2,625 M (2,295) Operating margin 12.8% (11.7) Cash flow 259 M (64) 2,625 M Operating profit 12.8% Operating margin

3 Improving performance towards our targets Targets set in 2016 and valid over a business cycle: Organic growth: 7.5% Target: 5% Operating margin: 12.8% Target: 12% Net debt / equity: 66% Target: <80% Net working capital: 31.7% Target: 25% Return on capital employed: 15.0% Target: 16% SKF Group

4 Sales growth in all markets Organic growth in local currency Q vs Q Europe +7.6% North America +3.2% Asia/Pacific +13.2% Latin America +0.7% Middle East & Africa +11.0% SKF Group

5 Create customer value Rotating equipment performance creates value Product & service Application knowhow Insight Customer performance Foresight Connected to customer applications, SKF will create and capture value and deliver functionality Connections include: Condition monitoring Integrated supply chain Hindsight SKF Group

6 Unplanned production stops cost billions Every time a machine is stopped and opened for maintenance when not needed drives cost New technology provides radically different tools for SKF to strengthen the competitiveness of our customers

7 SKF Group SKF to supply bearings to Volkswagen s all-electric MEB vehicle powertrain platform

8 LEAP Engine : a success for SKF SKF is a development partner in manufacturing, design and testing of main shaft and gearbox bearings Ceramic hybrid main shaft ball bearings SKF supports the LEAP program with a global supply chain, with plants in US and Europe. Key figures 14,300 total engine orders and commitments as of Feb Sole engine for Boeing 737 and COMAC C919 aircrafts, and 50% market share on Airbus A320neo SKF has now produced more than 6,000 main shaft bearings SKF selected for all main shaft and most gearbox bearings for the LEAP Engine SKF has now produced more than 6,000 bearings for the LEAP Engine SKF Group

9 Q1 results the details Christian Johansson, CFO

10 Sales development Percent y-o-y Q1 Q2 Q3 Q4 Q1 Organic Structure Currency Net sales SKF Group

11 SKF Group Organic sales growth

12 SKF Group Operating profit

13 SKF Group Operating profit

14 Performance by customer group Industrial Net sales 14,241 M Organic sales +8.5% Operating margin 15.0%, (14.0) Automotive Net sales 6,319 M Organic sales +5.5% Operating margin 7.7%, (6.8) SKF Group

15 SKF Group Q Financial performance (SEKm) Net sales Cost of goods sold Gross profit Gross margin, % 25.5% 25.4% Selling and administrative expenses Other operating income/expense Operating profit Operating margin, % Financial income and expense, net Profit before taxes Taxes Net profit Basic earnings per share, SEK % Operating margin SKF Group

16 SKF Group Cash flow after investments before financing*

17 SKF Group Net working capital 31.7% of annual sales

18 SKF Group Net debt/equity improved to 66 percent in the quarter

19 Guidance for 2018* Q2 2018: Financial net: around -200 million Currency impact on the operating profit is expected to be around 160 million negative compared with 2017, based on exchange rates per 31 March, : Tax level: around 29% for 2018, excluding effects from divestments Additions to property, plant and equipment: around 2,400 million for 2018 * Guidance is approximate and based on current assumptions and exchange rates. SKF Group

20 Reporting changes No adjustment for IAC on operating profit No sequential demand guidance Segment definitions have been aligned with industry standard Segment changes: Cars & Light trucks has been renamed to Light vehicles and includes two-wheelers Industrial Heavy and Special has been split in Agriculture, Food and Beverage, Industrial Drives and Marine Industrial General has been reclassified to Industrial Drives Other Industry has been renamed to Other Industrial SKF Group

21 Summary Q1 a good start to 2018 Continued growth in Q1 7.5% Organic sales growth Record-high sales and operating profit Expect to see continued growth in Q2 higher volumes year-over-year 2,625 M Operating profit 12.8% Operating margin

22 April 2018: SKF demand outlook Q Demand compared to the second quarter 2017 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, significantly higher in Asia and relatively unchanged in North America and Latin America. SKF Group

23 SKF Q1 results 2018 Q & A

24 Financial calendar Q1 report Virtual Roadshow JP Morgan Capital Goods Conference London Q2 report SEB Industrial & Technology Seminar Stockholm SHB Nordic Large Cap Seminar Stockholm Q3 report Capital Markets Day 26 April 15 May 15 June 19 July 23 August 12 September 25 October November SKF Group

25 Cautionary statement This presentation contains forward-looking statements that are based on the current expectations of the management of SKF. Although management believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those implied in the forward-looking statements as a result of, among other factors, changes in economic, market and competitive conditions, changes in the regulatory environment and other government actions, fluctuations in exchange rates and other factors mentioned in SKF's latest annual report (available on under the Administration Report; Risk management". SKF Group

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