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SKF publishes half-year report, reports solid growth

SKF reported solid growth in most regions, with organic revenue growth above five per cent and industrial growth at six per cent, in its half-year report. 

SKF’s half-year report indicated solid growth in most regions, with organic revenue growth above five per cent and industrial growth at six per cent. 

SKF president and chief executive operator Rickard Gustafson said the company would maintain its emphasis on controlling costs and increasing prices among the continued Russia-Ukraine war.

The war in Ukraine, coupled with the lockdowns in China during April and May, saw the company experience negative earning impacts.

The circumstances meant that materials, utilities, and logistics costs increased by approximately SEK 600 million ($84,987,978) compared to quarter one.

However, market conditions normalised in June, allowing SKF to report more stable earnings toward the end of the quarter.

“We continue to focus on creating a more customer-centric, profitable, faster growing and leaner SKF,” Gustafson said in the report.

The company reported double-digit organic growth on sales to targeted high-growth segments, including railway, automation, agriculture, and food and beverage.

Gustafson said SKF are currently making progress in its portfolio pruning, with decisions being made to exit margin-dilutive business with total sales of over SEK 1,200 million ($170,088), adding that there will be “further pruning to take place as long-term contracts come up for renewal.”

The second quarter of the year saw the launch of RecondOil box, which recorded sales of 400 units and a fast-growing order book.

Although SKF announced two site closures and completed its controlled exit from Russia, the company has since signed an agreement to acquire Tenute, an Italian seals manufacturer.

SKF has also reported some personnel changes, with president industrial sales China and Northeast Asia Patrick Tong and president industrial sales EMEA Kent Viitanen leaving the company in quarter three.

Looking to the future, Gustafson said the company expects a high single-digit organic sales growth as the year continues.

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