2008 © SKF Group

The SKF Group

SKF - A truly global company
Established: 1907
Sales 2008: SEK 63,361 million
Employees: 44,799
Production sites: 110 in 28 countries
SKF presence: in over 130 countries
Distributors/dealers: 15,000 locations
Global certificates: ISO 14001
OHSAS 18001 certification
2008 © SKF Group

SKF sales 2008 by geography
Asia / Pacific North America
19 17
Middle East and Latin America
Africa 3 5
Eastern Europe 5
51
Western
2008 © SKF Group
Europe

Net sales by customer segment
Cars and
light trucks
Industrial
ce
distribution s pa
Aero
ay
R ailw
Commercial
w ay
Off-high transport
Vehicle Service Trucks
Market l
ustria
l ind ent Two-wheeler and
e cia uipm
Sp e q Electrical
General
Energy industry
Heavy
industry
Industrial business
2008 © SKF Group

SKF Group Vision
To equip the world
with SKF knowledge
2008 © SKF Group

What is SKF knowledge?
2008 © SKF Group

SKF’s platforms
Bearings
and units
2008 © SKF Group

SKF’s platforms
Seals
2008 © SKF Group

SKF’s platforms
Mechatronics
2008 © SKF Group

SKF’s platforms
Lubrication
systems
2008 © SKF Group

SKF’s platforms
Services
2008 © SKF Group

Investing in the future
Organic * Investing above depreciation
* 9 new factories
(2 under development, 1 postponed)
* Significant investment in existing operations
(eg Sweden, Germany)
Acquisitions * Over SEK 5.2 billion invested
* 20 acquisitions – all platforms
R&D & AE * New energy efficient bearings and solutions
* New market offers/products
~SEK 24 billion (~EUR 2.5 billion) invested since 2003
2008 © SKF Group

Acquisition strategy;
Identifying gaps and opportunities in all platforms
Bearings Lubrication
Seals Services systems Mechatronics
and units
Products SNFA (2006) Economos (2006) Safematic (2006) ABBA (2007)
GLO (2008) Macrotech (2006) Jaeger (2005)
Technologies S2M (2007) Baker (2007) Vogel (2004)
Geographies QPM (2008) PMCI (2007) ALS (2007) TCM (2003)
Scandrive PB&A (2006) Sommers (2005)
(2003)
Monitek (2006) Cirval (2008)
Segments Peer (2008)
Green: Acquisitions in 2008.
2008 © SKF Group

Continuous development of new market offers
• Offer for the agriculture industry
• Five times increased farm productivity (20,000->100,000 ha)
• Reduced cost of ownership by 30%
• Reduced seed bed pollution up to 500 kg of grease / machine
• Reduced cost of management by 90%
Reduced: Grease usage, warranty cost
Increased: Farm productivity &
profitability
SKF Agri Hub
2008 © SKF Group

Financial performance
Operating margin Sales growth in local currency
% %
14 12.9 12.2 14 13.2
12.6
11.8
12 10.8 12
9.9
10 10
8.0 7.3 7.5 7.1
8 8
6
5.2
6
4 4
2 2
0 0
2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008
Return on capital employed
% 24.7 25.4 24.2
24
21.8 Long-term targets
22
19.0 • 12% Operating margin level
20
18
• 6-8% Growth per annum (local)
16
• 24% ROCE
13.9
14
12
10
2003
2008 © SKF Group 2004 2005 2006 2007 2008

Six Sigma
2008 H1 status:
• 18 Master Black Belts
• 410 Black Belts
• 1,950Green Belts
• 1,128 projects closed whereof 59 replicated
• 879 projects ongoing
Hard savings 4 dimensions:
2005: SEK 150 m ”Standard” Six Sigma, Design for Six Sigma,
2006: SEK 200 m Lean Six Sigma and Six Sigma for Growth
2007: SEK 302 m
2008: SEK 462 m
2008 © SKF Group

SKF Care
Business Care Employee Care
14
12
10
8
6
4
2
0
2003 2004 2005 2006 2007 2008
Operating margin
BeyondZeroTM SKF Care
Environmental Care Community Care
2008 © SKF Group

BeyondZeroTM
• Energy efficient bearings
•
•
Mechatronics in welding robots
Actuators in window facade
+
• By-wire auto-throttle in aerospace
• Client Needs Analysis – Energy and
BeyondZero
Sustainability
0
Reduce energy intensity
• Energy training + energy toolbox
• Energy efficient pumps
• Energy efficient motors
-
• Waste heat recovery
• Improved window insulation
Reduce carbon intensity
• On-site solar power
• Sourcing renewable energy
2008 © SKF Group

Reducing customers emissions
– advanced integrated solutions
SKF Hybrid Pinion Unit
• Rear- and All Wheel Driven vehicles
• Sustainability: Reduction potential of up to 3 g
CO2 per km through reduced friction by 30 %
• Improved stiffness and easy and reliable
mounting at the customer
2008 © SKF Group

SKF community projects worldwide
Austria, Basky Germany, OBArt Sweden, Gothia Cup Turkey, Siirt
China,Hope School
Brazil, Communidade
Malaysia, volunteer
Argentina, Garrahan Foundation
South Africa, Legae India, Sports Academy
2008 © SKF Group

SKF Commitment
VALUES
High Ethics
Openness
Empowerment
Team Work
DRIVERS
Profitability
Quality
Innovation
Speed
Sustainability
2008 © SKF Group

2008 © SKF Group