By Katarina Gustafsson
STOCKHOLM--Swedish engineering group Sandvik AB (SAND.SK) said
Thursday it is adjusting production levels in response to a slower
market as it posted a lower-than-expected third-quarter net profit.
The company added it has taken a 250 million euro ($324.9 million)
loan from the European Investment Bank for research and development
investments.
MAIN FACTS:
-Sandvik made a net profit of SEK2.10 billion ($315 million) for
the third quarter 2012, compared with a net profit of SEK626
million for the same period 2011 when its earnings were hit by
one-off costs.
-The average forecast in a Dow Jones Newswires/Factset poll of
analysts was for a net profit of SEK2.20 billion.
-Revenue was SEK23.42 billion, compared with SEK23.53 billon a
year ago and expectations for SEK23.60 billion.
-Order intake was SEK21.80 billion, compared with SEK24.83
billion a year earlier.
-Operating profit was SEK3.33 billion, compared with the SEK3.54
billion analysts had expected, but up from SEK1.67 billion a year
earlier when its profit was hit by goodwill writedown and
restructuring costs.
-Changed exchange rates had a negative impact of around SEK120
million on earnings while changed metal prices had a negative
impact of SEK96 million.
-Sandvik said it is reducing production levels at varying levels
in its business areas in response to weakening demand and announced
its turnaround programs in the units Sandvik Materials Technology
and Sandvik Construction will be adjusted.
-It said the biggest downward shift in demand is in mining where
the decline gathered momentum as the quarter passed, while the
aerospace industry remained strong.
-In a separate release, Sandvik announced it has taken a EUR250
million ($324.9 million) loan from the European Investment Bank for
research and development investments in Europe 2012-2015. A similar
loan was signed in 2007 for activities carried out during the years
2007 to 2011.
-Shares Wednesday closed at SEK88.90.
-Write to Katarina Gustafsson at
katarina.gustafsson@dowjones.com; Twitter: @DowJonesNordics
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