- SKF's (SKFRY, Financial) Q1 2025 net sales stood at MSEK 23,966, indicating a 3.5% decline in organic growth.
- The adjusted operating margin slightly improved to 13.5%, supported by strong pricing actions.
- Despite weak demand, SKF's Automotive business separation progresses with 16 factories finalized.
SKF (SKFRY) reported net sales of MSEK 23,966 in Q1 2025, marking a 3.5% organic decline attributed to reduced market demand across various regions and industries, with aerospace remaining an exception. Despite this, the company's adjusted operating margin saw a slight improvement to 13.5% from 13.4% the previous year, with the Industrial segment leading at 16.9% and Automotive at 5.2%.
The firm's margin resilience was maintained through effective pricing strategies, portfolio management, and cost controls, which helped offset weaker volumes. However, net cash flow from operating activities witnessed a decline to MSEK 977 from MSEK 1,781, affected by increased working capital needs and negative currency impacts.
SKF continues to advance the separation of its Automotive business, completing 16 factories, though the complexity of IT structures may prolong the overall timeline. For Q2 2025, SKF anticipates ongoing market volatility with a projected weakening in organic sales, compounded by a negative currency impact of approximately MSEK 400 on operating profits, compared to the previous year.
