Alfa Laval: Summary of Alfa Laval’s Capital Markets Day

  Alfa Laval: Summary of Alfa Laval’s Capital Markets Day

Business Wire

LUND, Sweden -- November 20, 2012

Regulatory News:

Alfa Laval’s (STO:ALFA) Capital Markets Day, held today in Copenhagen,
Denmark, started with a presentation by Lars Renström, President and CEO. He
kicked off by following up on the organization change, implemented at the
beginning of the year.

“We have gone from two selling divisions to three and today we have a larger,
more transparent and focused Alfa Laval. The change is something which both
the Marine & Diesel Division and the Equipment Division has benefitted from,”
said Lars Renström.

He also talked about the priorities set for the divisions going forward,
starting with the Equipment Division where the focus will be to increase the
market penetration in a cost-efficient way by going to market through multiple
sales channels and e-commerce. Another key area is the aftermarket, where
further growth potential is seen. In the Marine & Diesel Division “we see
significant potential in environmental solutions and energy efficiency.”
Finally, the Process Technology Division, where the priority is to focus on
energy – both energy production and energy efficiency - environment and
capturing growth in fast-growing regions.

Elaborating on Alfa Laval’s acquisition strategy he went through its three
dimensions. “Our highest priority is to add complementary products in the
three core technologies,” he said. “Four out of five recent acquisitions have
added products that we can sell through our global/local sales organization,”
he continued. Going forward we expect to find most targets among complementary
products in mainly Western Europe and North America. The second dimension is
to serve customers by acquiring complementary channels, like last year’s
acquisition of a channel servicing HSS. “The third dimension is strengthening
our presence in certain countries, like the U.S., China and Korea.”

In his presentationThomas Thuresson, Executive Vice President and CFO, gave an
update on the current funding situation, saying that committed credit
facilities totals SEK 9 billion of which SEK 8 billion matures in 5 years or

Furthermore he provided an updated guidance on tax. Given that the proposal on
cutting corporate income taxes in Sweden is accepted, i.e. taxes are cut to 22
percent from 26.3 percent, the guidance will be adjusted to 28 percent on
profit before tax from 2013. A cut would also lead to a positive non-recurring
effect of about SEK 100 million in the fourth quarter.

As for foreign exchange, the forecast from the third-quarter report was
reiterated. Alfa Laval will have negative currency effects of SEK 155 million
for the full year 2012 and for 2013 it is estimated to be positive by some SEK
50 million.

When talking about the savings measures that were initiated in the fourth
quarter of 2011, he repeated that the expected full year savings of some SEK
200 million will be met. By the end of the third quarter some SEK 120-130
million had been realized. “Given that the full effects were not seen until
the third quarter, and that everything stays the same, we have a further
opportunity to realize savings with up to SEK 80 million in Q4 and a further
SEK 100 million in the first half of 2013,” he said.

Turning over to Capex, Alfa Laval’s guidance has for many years been 2.5
percent of sales. “Given our history and the capacity we have built during
recent years, we would like to adjust our guidance for Capex to 2.0 percent of
sales over the coming years.”

Divisional managers Susanne Pahlén Åklundh and Svante Karlsson also gave
updates on the development in their respective divisions, describing current
trends and activities.

“The Equipment Division is a component-driven transactional business. Easy to
do business with is therefore vital for us,” said Susanne Pahlén Åklundh,
manager for the Equipment Division. “We go to market through channels, which
is why development of a global network of distributors and other channels is
our main focus,” she said. She also highlighted the aim to convert most of the
business into e-business – the main objective being profitable growth. “We are
just about to launch a completely new e-commerce platform which gradually will
be rolled out to cover the channel market more efficiently,” she said.
“Channel management and price management are critical success factors in
Equipment Division.”

In his presentation Svante Karlsson, manager for the Process Technology
Division, summarized the development in the first nine months. Talking about
oil & gas exploration then “sales this year is well above last year and we see
continued investments in this market,” Svante Karlsson said. “Our increased
sales are not only a result of a good business climate, but also due to new
products being launched and also existing products being introduced into new
areas such as transportation,” he continued. Downstream he talked about how
the extremely energy-consuming refinery industry is a good fit for Alfa
Laval’s efficient heat exchangers. “Overall we have seen growth in our
refinery business this year,” Svante Karlsson said. Finally he concluded that
structural changes like increased living standard, focus on energy savings,
waste management and environmental demands are very important for the
division, contributing to growth. “Our customers will have to make investments
to capitalize on these trends,” he said.

Peter Leifland, manager for the Marine & Diesel Division, also gave a
presentation. The summary of what he said is included in a separate press

All the presentations can be found on – “Investors”.

About Alfa Laval

Alfa Laval is a leading global provider of specialized products and
engineering solutions based on its key technologies of heat transfer,
separation and fluid handling.

The company’s equipment, systems and services are dedicated to assisting
customers in optimizing the performance of their processes. The solutions help
them to heat, cool, separate and transport products in industries that produce
food and beverages, chemicals and petrochemicals, pharmaceuticals, starch,
sugar and ethanol.

Alfa Laval’s products are also used in power plants, aboard ships, in the
mechanical engineering industry, in the mining industry and for wastewater
treatment, as well as for comfort climate and refrigeration applications. Alfa
Laval’s worldwide organization works closely with customers in nearly 100
countries to help them stay ahead in the global arena.

Alfa Laval is listed on Nasdaq OMX, and, in 2011, posted annual sales of about
SEK 28.6 billion (approx. 3.2 billion Euros). The company has today about 16
000 employees.

This information was brought to you by Cision


Peter Torstensson
Senior Vice President
Communications Alfa Laval
Tel: + 46 46 36 72 31
Mobile: +46 709 33 72 31
Gabriella Grotte
Investor Relations Manager Alfa Laval
Tel: +46 46 36 74 82
Mobile: +46 709 78 74 82
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