Swedish SKF reports weaker demand in China

SKF, a leading global supplier of bearings, seals, mechatronics, lubrication systems, and services, published its half-year 2015 report on July 15, with Alrik Danielson, President and CEO commenting: “Demand in the [second] quarter was largely in line with guidance, with reported sales in local currency declining with 1.5 per cent, excluding structural change. We saw a good growth in railways except for China and in energy except for Europe. A weaker demand was seen in heavy industry and the distributor segment in North America as well as an underlying weaker demand in China. The automotive business in North America was also slow during the quarter.”

swe_cn_skfWithin the Automotive Market a profit improvement programme was launched. A number of activities were initiated with the aim to improve productivity and the competitiveness of the business. The structure has been simplified and focused initiatives are being carried out through the value-chain, he also informed.

To focus efforts and resources on bearings, their main business, and to strengthen their balance sheet, three non-core businesses have been divested : Erin Engineering and Research Inc., Purafil, and Kaydon Custom Filtration with a total consideration close to SEK 1 000 million on a cash-free and debt-free basis.

“During the first-half year we saw a weak development of the global industrial production. Lately the uncertainty regarding the market demand in China has increased further. Entering the third quarter we all in all experience a relatively weak industrial production. Looking forward we expect demand to be sequentially slightly lower and relatively unchanged year-over-year.’’

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