© Reuters.

By Helena Soderpalm

STOCKHOLM (Reuters) – SKF, the world’s biggest maker of industrial bearings, forecast on Tuesday further sales growth in the third quarter after reporting earnings slightly above forecasts despite negative currency effects and rising costs.

SKF reported its organic net sales jumped by a third in the second quarter from the depths of the coronavirus pandemic a year earlier, helped by a strong recovery in demand from the auto industry. Its automotive business, which generates about 30% of overall sales, soared 75.9% while the industrial division, which accounts for 70% of sales, reported a 21.7% rise in sales.

The Swedish firm, which competes against Germany’s Schaeffler said it expected an organic growth of around 10% in the third quarter compared with a year ago.

SKF reported second-quarter operating earnings of 2.88 billion Swedish crowns ($331.3 million), above the 2.81 billion forecast in a Refinitiv poll, and well above 669 million reported a year earlier.

“This is the strongest EBIT beat so far this quarter in the sector,” investment bank Jefferies (NYSE:) said in a note, noting that adjusted operating margin in the industrial division grew to 18% from 14% in the year-ago quarter.

SKF shares, which were unchanged so far this year through Monday, were up 2.5% at 0703 GMT.

Chief Executive Officer Rickard Gustafson, who took the reins last month, warned however that strain on the supply chain would continue to “be a theme” also in the third quarter.

“The pandemic, as we all know, is far from over. We are still wrestling with this… And the supply situation is still a challenge, but we do believe that demand growth will continue,” he told analysts and reporters.

SKF had said in April that the global semiconductor shortage that has forced global automakers to cut production in recent months could have a “minor effect” in the second quarter.

($1 = 8.6930 Swedish crowns)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link


Please enter your comment!
Please enter your name here