Sandvik Sees Negative Currency Effects Of SEK800 Million In Quarter
May 03 2011 - 7:27AM
Dow Jones News
Swedish engineering company Sandvik AB (SAND.SK) Tuesday said it
sees unfavorable foreign-exchange rates cutting 800 million Swedish
kronor ($133 million) from operating profit in the second
quarter.
Sandvik told analysts it saw currency movements cutting between
SEK1.5 billion and SEK2 billion from its operating profit before
interest and tax in 2011, given the prevailing currency rates at
end of April.
Sandvik reports earnings in Swedish kronor and has a large
proportion of its production in Sweden, while sales overseas are
denominated in a variety of currencies, and consequently are
affected by currency movements.
During the first quarter, the Swedish krona strengthened against
the dollar and the euro. The krona also strengthened against the
Japanese yen, South Africa's rand and the Australian dollar, and
other currencies that have an impact on the company.
Sandvik said that metal prices would have no material effect on
its operating profit in the second quarter, given currency rates,
stock levels and metal prices in the end of March.
Sandvik is hosting a conference call at 1200 GMT, but neither
its recently appointed chief executive nor its chief financial
officer will participate, due to a board meeting and Sandvik's
annual general meeting Tuesday.
-By Sven Grundberg, Dow Jones Newswires; +46-8-5451-3098;
sven.grundberg@dowjones.com
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