Lydall Inc, USA

Lydall Inc, USA

Filtration Industry Analyst March 2005 Alfa Laval AB, Sweden Key Figures (SKr million) Fourth quarter ended 31.12.2004 Order Intake 3750 Net Sales...

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Filtration Industry Analyst

March 2005

Alfa Laval AB, Sweden Key Figures (SKr million) Fourth quarter ended 31.12.2004 Order Intake

3750

Net Sales

4166.1

4086.3

Expenses

856.4

846.5

1392.4

1385.0

536.0

538.5

Return after Financial Items

303

275

Cash Flow from Operations

302

629

Adjusted EBITA

Year ended 31.12.2004

2003

15 740

14 145

Net Sales

14 985.8

13 909.3

Expenses

3386.2

3315.7

Adjusted Gross Profit

5342.2

5235.8

Adjusted EBITA

1956.0

1920.1

Return after Financial Items

1070

817

Cash Flow from Operations

1118

1654

Order Intake

COMMENT Alfa Laval has posted solid full-year 2004 figures, with net sales up 11.7% on the previous year at SKr14 985.8 million and order intake increasing 15.2% to SKr15 740.0 million (both excluding exchange rate variations). For the year, the Equipment division saw its orders increase 13.2% to SKr8862.3 million and net sales increase 8.6% to SKr8250.4 million compared to the previous year. All of the division’s six segments developed strongly, the most significant growth being in the Marine & Diesel, and, OEM units. In the Process Technology division, orders for 2004 rose 18.5% on the year earlier figure to reach

10

Key Figures (US$ million) Fourth quarter ended 31.12.2004

2003

3771

Adjusted Gross Profit

COMPANY WATCH

Lydall Inc, USA

SKr6818.0 million, while net sales increased 16.2% to SKr6683.3 million. Excluding the contribution of the bioKinetics acquisition, these increases were 16.9% and 13.8% respectively. One of Alfa Laval’s success stories has been the Alfdex system that it jointly owns with Haldex. Built around the company’s expertise in centrifugal separation, the system offers a very efficient removal of oil droplets and soot particles from the ventilation air in diesel engine crankcases. With recent sales agreements reached with Volvo and Scania, the Alfdex system has secured annual revenues of SKr1000 million in a short period of time. ■

2003

Net Sales Of Which: Filtration/Separation

75.6

63.1

19.9

18.1

Cost of Sales

62.6

50.2

Gross Margin

13.0

12.9

Operating Income/(Loss) Of Which: Filtration/Separation

(1.5)

0.4

1.4

1.3

Income from Continuing Operations

(1.2)

0.4

Net Income

(1.2)

0.4

Year ended 31.12.2004

2003

Net Sales Of Which: Filtration/Separation

292.4

271.4

81.2

74.9

Cost of Sales

234.9

207.0

Gross Margin

57.5

64.4

Operating Income/(Loss) Of Which: Filtration/Separation

0.3

13.8

11.0

8.8

Income from Continuing Operations

(0.5)

8.5

Net Income

(0.5)

7.7

COMMENT Within Lydall’s Filtration /Separation business, air filtration sales were strong, particularly in the Asian market throughout 2004. Liquid filtration sales were also up, while Vital Fluids sales dropped due to lower bioprocessing and OEM sales. Operating income for the segment increased 8% for the quarter and 25% for the full year compared with 2003. The air and liquid filtration businesses improved profitability through higher volume, cost reductions,

and better absorption of overhead. This was partially offset by a dip in performance from the Vital Fluids business related to product recall and production inefficiencies during the year. But David Freeman, president and chief executive officer, said that the company’s achievements had been overshadowed by the cost and diversion of restructuring its domestic automotive manufacturing operations and its expansion efforts in Europe (now complete).■