Today s program. Sigge Haraldsson. Ulf Granstrand and Mikael Carleson. Svante Karlsson and Ole Petersen. Göran Mathiasson.

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2 Today s program Capital Market Day, September 7, 2003 Introduction Sigge Haraldsson Parts & Service in the Process Technology division Ulf Granstrand and Mikael Carleson Equipment division - selling to multiple sales channels Svante Karlsson and Ole Petersen Logistics and manufacturing Göran Mathiasson Financials Thomas Thuresson Questions and Answers Questions and Answers Sigge Haraldsson Alfa Laval Slide 2

3 Summary Interim Report Q Mr. Sigge Haraldsson President and CEO Alfa Laval Group

4 Highlights Q204 Order intake: Net sales: 4,174 MSEK 3,798 MSEK Alfa Laval Slide 4

5 Q on Q vs. last year (excl FX) Order intake 18% 14% 10% 6% 2% Q Q Q Q Alfa Laval Slide 5

6 Highlights Q204 Order intake: Net sales: 4,174 MSEK 3,798 MSEK Adjusted EBITA / margin: 420 MSEK / 11.1 % Alfa Laval Slide 6

7 Adjusted EBITA MSEK Deviation FX. translation FX. transaction Deviation excl FX Q H * Adjusted EBITA Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items. Alfa Laval Slide 7

8 Adjusted EBITA / margin * MSEK and in percent of sales ,0 12,0 10,0 8,0 6,0 4,0 2,0 0 Q301 Q401 Q102 Q202 Q302 Q402 Q103 Q203 Q303 Q403 Q104 Q204 0,0 * Adjusted EBITA Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items. Alfa Laval Slide 8

9 Gross profit margin 50 In percent of sales % 35.8% Pricing & volume leverage approx. 0.7% = 39.2% Sales mix approx. 1.0% = 38.5% FX approx. 1.7% = 37.5% Q301 Q401 Q102 Q202 Q302 Q402 Q103 Q203 Q303 Q403 Q104 Q204 Alfa Laval Slide 9

10 Further strengthen profitability Raw material... two price increases Price pressure. less than 12 months ago Incentive. increased focus on profit Assertiveness.. price increase created new level Volume leverage. high level of factory utilization Alfa Laval Slide 10

11 Highlights Q204 Order intake: Net sales: 4,174 MSEK 3,798 MSEK Adjusted EBITA / margin: 420 MSEK / 11.1 % Profit before tax: 259 MSEK Alfa Laval Slide 11

12 Highlights Q204 H104 Order intake: Net sales: 4,174 MSEK 3,798 MSEK Adjusted EBITA / margin: 420 MSEK / 11.1 % Profit before tax: 259 MSEK Adjusted EBITA / margin: 803 MSEK / 11.5 % Alfa Laval Slide 12

13 Highlights Q204 H104 Order intake: Net sales: 4,174 MSEK 3,798 MSEK Adjusted EBITA / margin: 420 MSEK / 11.1 % Profit before tax: 259 MSEK Adjusted EBITA / margin: 803 MSEK / 11.5 % Profit before tax: 470 MSEK Cash flow from operating activities: 519 MSEK ROCE: 22.5 % Alfa Laval Inc. was co-defendant in 143 asbestos-related lawsuits with approximately 21,200 plaintiffs. Alfa Laval Slide 13

14 Orders received by Segment + Comfort & Refrigeration Parts & Service + + Marine & Diesel Life Science Process Industry Fluids & Utility OEM Energy & Environment + + Sanitary Food + January June 2004 Alfa Laval Slide 14

15 Orders received by Region Nordic 13 % Other 2 % L. America 3 % Asia Asia 26 % Western Europe 31 % Centr.. && East East 88 %% North North America America % January June Alfa Laval Slide 15

16 Outlook 2004 Alfa Laval is expecting a very strong increase in orders received during the full year that the EBITA-margin, excluding exchange rate variations, will continue to improve. Alfa Laval Slide 16

17 Update on key initiatives Mr. Sigge Haraldsson President and CEO Alfa Laval Group

18 AlfaNova - 12 months after New markets Available today in four sizes Pace of units/year Launch of one more size within short Alfa Laval Slide 18

19 AlfaCond - 12 months after High interest and quick acceptance from the market Pace of 60 units/year Second size introduced Alfa Laval Slide 19

20 Cleaning of crankcase gases New innovative solution to separate fluids and solids from gases Require manufacturers of diesel engines to clean also the crankcase gases A cooperation with Haldex resulted in Alfdex, a jointly owned company Alfa Laval Slide 20

21 The Alfdex initiative Most of the engine manufacturers have already done their initial tests. Estimated market potential of BnSEK 1 per year Letter of intent from Scania Alfa Laval Slide 21

22 Organic and acquired growth Existing products Customer segments New market concepts All six gears should give us an annual average growth of 5% over a business cycle Market-driven R&D Parts & Service New core products Alfa Laval Slide 22

23 Profit generation through market penetration Mr. Sigge Haraldsson President and CEO Alfa Laval Group

24 Financial Targets Volume growth 5% EBITA 12-15% ROCE > 20% V Alfa Laval Slide 24

25 Our Mission To optimise the performance of our customers processes. Time and time again. V Alfa Laval Slide 25

26 Customer focus Beverage Biochemical Brewery Chemical Engineering Fish and meat processing Food processing Heating and ventilation Marine Mining Oil and gas Pharmaceutical Power generation Refrigeration Steelworks Starch Sugar Vegetable oil Water and waste water treatment Alfa Laval Slide 26

27 Focus on customer segments 10 Customer Segments 2001 Alfa Laval Slide 27

28 A customer segment offers Single products Product packages Added value; modules, systems, new products and service contracts Process knowledge and expertise Alfa Laval Slide 28

29 Focus on customer segments P&S Comfort & Refrigeration Marine & Diesel Equipment division To offer a range of high-performance products and solutions for customers who have a well-defined and regular need. A multiple sales channel strategy to reach end-users. Sanitary OEM Sales H104 Fluids & Utility Alfa Laval Slide 29

30 Focus on customer segments Equipment division To offer a range of high-performance products and solutions for customers who have a well-defined and regular need. A multiple sales channel strategy to reach end-users. Sales H104 Channel sales End-user sales Alfa Laval Slide 30

31 Focus on customer segments Life Science P&S Process Industry Food Energy & Environment Process Technology division To offer unique solutions helping customers to optimize their processes. Our scope includes everything from components to systems. Sales H104 Alfa Laval Slide 31

32 Focus on customer segments Food Energy & Environment Process Technology division To offer unique solutions helping customers to optimize their processes. Our scope includes everything from components to systems. Process Industry Life Science Sales H104 Capital sales After sales Alfa Laval Slide 32

33 Today s program Capital Market Day, September 7, 2003 Introduction Sigge Haraldsson Parts & Service in the Process Technology division Ulf Granstrand and Mikael Carleson Equipment division - selling to multiple sales channels Svante Karlsson and Ole Petersen Logistics and manufacturing Göran Mathiasson Financials Thomas Thuresson Questions and Answers Questions and Answers Sigge Haraldsson Alfa Laval Slide 33

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