STOCKHOLM, Sweden — SKF has reported an increase of 8.2 percent in net sales for the quarter, which the company says was attributable to the following: volume -13 percent, structure 2.4 percent, price/mix 8.5 percent and currency effects 10.3 percent.
For the full year, the increase of 8.2 percent was attributable to: volume 0.1 percent, structure 1.4 percent, price/mix 5.6 percent and currency effects 1.1 percent.
The fourth quarter included expenses for restructuring activities and other one-time items of around approximately $42 million, of which around $9.2 million are write-downs and impairments.
In order to keep a strong balance sheet to be able to manage the uncertain business environment in 2009, and to enable the Group to take the opportunities to invest in its business, SKF’s Board has decided to propose to the Annual General Meeting a dividend of approximately 43 cents per share.
Outlook for the first quarter of 2009 (compared to the fourth quarter of 2008 and the first quarter last year), the demand for SKF products and services is expected to be significantly lower for the Group in total and for all regions. It is also expected to be significantly lower for the Automotive and Service Divisions and lower for the Industrial Division.
The manufacturing level will be significantly lower to reflect both the new demand situation and to reduce inventory.
Tom Johnstone, SKF president and CEO, commented, “2008 was a very good year for SKF with record sales and profit. However market demand weakened considerably towards the end of the year. In the fourth quarter, the automotive business continued to deteriorate and a negative trend was seen also for several industrial segments. SKF initiated actions to adapt its capacity and cost base globally to address this. As we enter 2009, market demand is increasingly uncertain and we expect the weakening trend will continue. The drop in volume year on year is likely to be greater in the first quarter than what we saw for the fourth quarter 2008. We are cutting manufacturing more than sales to both reflect the new demand and to reduce inventory."