1. Alrik Danielson, President and CEO
SKF Q1 results 2019
Alrik Danielson, President and CEO
1 August, 2019

2. Q1 – strong operating performance
0.3% Organic sales growth
Net sales of 21,278 M, organic growth 0.3%
Operating profit 2,658 M (2,625)
Operating margin of 12.5% (12.8)
Cash flow 684 M (259)
2,658 M Operating profit
12.5% Operating margin
1 August, 2019

3. Industrial business performing well; increased volumes in all three main markets, North America, Europe and Asia 3.0% organic growth in Q1
1 August, 2019

4. Automotive; organic sales in Q1 declined due to lower car volumes in Europe, Asia and North America % organic growth in Q1
1 August, 2019

5. Improving performance towards our targets - Targets set in 2016 and valid over a business cycle:
1 August, 2019

6. Stable revenues on high level in the quarter Organic growth in local currency Q1 2019 vs Q1 2018
Europe
+1%
North
America
+0%
Asia/Pacific
+0%
Latin
America
+2%
1 August, 2019

7. New plant inaugurated in Changshan, China
1 August, 2019

8. Cooperation between SKF and Siemens – MindSphere
1 August, 2019

9. Q1 results – the details Christian Johansson, CFO2
Q1 results – the details Christian Johansson, CFO

10. Sales development 2018 2019 Q1 Q2 Q3 Q4 Organic +7.5 +9.0 +6.9 +5.0
Percent y-o-y Q1 Q2 Q3 Q4
Organic
+7.5
+9.0
+6.9
+5.0
+0.3
Structure
-0.7
-0.6
-0.1
-1.0
-2.5
Currency
-1.9
+3.4
+7.8
+4.8
+5.7
Net sales
+4.9
+11.8
+14.6
+8.8
+3.5
1 August, 2019

11. Operating profit
1 August, 2019

12. Operating profit
1 August, 2019

13. Performance by customer group
Industrial
Net sales 15,049 M
Organic sales +3.0%
Operating margin 15.4%, (15.0)
Automotive
Net sales 6,229 M
Organic sales -5.9%
Operating margin 5.5%, (7.7)
1 August, 2019

14. 12.5% Operating margin SKF Group – Q1 2019
Financial performance (SEKm)
2019
2018
Net sales
21 278
20 560
Cost of goods sold
Gross profit
5 421
5 248
Gross margin, %
25.5%
Selling and administrative expenses
-2 805
-2 700
Other operating income/expense 42 77
Operating profit
2 658
2 625
Operating margin, %
12.5
12.8
Financial income and expense, net
-216
-200
Profit before taxes
2 442
2 425
Taxes
-661
-638
Net profit
1 781
1 787
Basic earnings per share, SEK
3.77
12.5% Operating margin
1 August, August, August, August, 2019

15. Cash flow after investments before financing*
1 August, 2019

16. Net working capital
1 August, 2019

17. Net debt/equity ratio well below target
1 August, 2019

18. Guidance for 2019* Q2 2019: Financial net: around -240 million
Currency impact on the operating profit is expected to be positive by 110 million compared with 2018, based on exchange rates per 31 March, 2019.
2019:
Tax level: around 28% for 2019, excluding effects from divestments
Additions to property, plant and equipment: around 2,800 million for
* Guidance is approximate and based on current assumptions and exchange rates.
1 August, 2019

19. Summary – strong operating performance in Q1
0.3% Organic sales growth
Organic growth of 0.3%
Operating profit 2,658 M - best Q1 result to date
Operating margin of 12.5%
Improved cash flow
Expect to see slightly lower volumes in Q2
2,658 M Operating profit
12.5% Operating margin
1 August, 2019

20. SKF Q1 results 2019 Q & A
1 August, 2019

21. April 2019: SKF demand outlook Q2 2019
Demand compared to the second quarter 2018 The demand for SKF’s products and services is expected to be slightly lower for the Group, including relatively unchanged demand for Industrial and lower demand for Automotive. Demand is expected to be slightly lower in Europe, Asia and in North America and higher in Latin America.
1 August, 2019

22. Financial calendar Q1 report 25 April UK roadshow 8-9 May
European Roadshow Germany/Netherlands/France
May
JP Morgan London seminar
14 June
Q2 report
17 July
SEB Technology seminar
29 August
US roadshow
September
Q3 report
22 October
UBS London conference
13 November
1 August, 2019

23. 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 at SKF" and "Sensitivity analysis”.

24. 1 August, 2019