Sales in the second quarter in local currencies and excluding structure decreased by 4% in Europe and Asia, was relatively unchanged in North America and decreased by 3% in Middle East and Africa. In Latin America they increased by 14%.
“SKF delivered a good performance and a strong cash flow,” said Tom Johnstone, SKF president and CEO. "Demand was somewhat better in the quarter than we expected in April and this--combined with the steps we are taking to reduce our costs--enabled us to continue our journey to deliver a sequentially improving operating margin. [...] The profitability in our automotive business is developing in the right way due to strong execution and improving demand especially in our truck business and vehicle service market." According to Johnstone, SKF continues to be successful in gaining new business, especially with new products which help reduce weight and friction and so improve fuel consumption. Although SKF does not see any major improvement in demand in its industrial markets around the world, the company has taken a number of important orders particularly within aerospace and its service business. Lastly, the strong automotive business and weaker industrial business negatively affected SKF's mix, SKF stated.
Johnstone made his predictions for the company for the rest of 2013. ”While there continues to be uncertainty from a macro viewpoint, we expect demand in the third quarter to remain on the same level--which means it will be slightly higher compared to the same quarter last year," he stated. "The manufacturing level was increased during the second quarter, and we will stay at that level in the third quarter.”