Sandvik Orders Fall Across the Group
October 23 2015 - 4:07AM
Dow Jones News
By Dominic Chopping
STOCKHOLM--Swedish engineering company Sandvik AB (SAND.SK)
Friday posted a drop in third-quarter net profit after seeing all
of its business areas experience weaker order intake.
Sandvik, which makes tools for customers in the mining,
construction and energy sectors, said net profit in the three
months ended September 30 was 236 million Swedish kronor ($27.9
million), down from SEK1.46 billion in the same period last year.
However, included in the most recent quarter is a SEK1.02 billion
cost related to the previously announced sale of its Mining Systems
unit.
Sales fell 1% to SEK20.75 billion while order intake fell 8% to
SEK19.73 billion.
"Operating profit declined by 7% and the operating margin
contracted to 11.2%, as the positive impact from changed exchange
rates and savings generated by ongoing cost-reducing actions did
not off-set the negative impact on operations from lower volumes,"
said Chief Financial Officer and acting Chief Executive Mats
Backman.
In the last few years, Sandvik's profitability has been hit by
low demand in the mining sector, and the company said in its
second-quarter earnings that mining demand had declined further in
Europe and Asia, although it did see some relative strength in
North America. Cost saving measures have so far done little to lift
margins.
At 0733 GMT shares traded 1.8% higher at SEK78.55.
-Write to Dominic Chopping at dominic.chopping@wsj.com; Twitter:
@WSJNordics
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 23, 2015 03:52 ET (07:52 GMT)
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