The document summarizes SKF Group's third quarter 2009 results. Key points include a 24.9% year-over-year drop in sales volume but continued strong price/mix gains. Despite restructuring costs, the operating margin excluding restructuring was 8.7%. Cash flow remained strong at SEK 1.36 billion for the quarter. SKF expects demand in the fourth quarter to be slightly higher than Q3.

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20 October 2009

2. The SKF Group
Nine-month results 2009
Tom Johnstone, President and CEO

3. Key points from Q3 report 2
• Strong cash flow
Q3: SEK 1,359 m YTD September: SEK 4,307 m
• Dramatic volume drop year over year. Trend indicates levelling off.
Q3: -24.9% YTD September: -27.6%
• Continued strong price/mix
Q3: 3.7% YTD September: 5.5%
• Cost reduction efforts in focus and giving results
- annualised savings from all programmes, around SEK 800 million
- significant short-time working being utilized. Now 14,000 people.
• Demand outlook for Q4
- year over year: significantly lower
- sequentially: slightly higher
20 October 2009

4. Highlights Q3 2009 3
SKF
• inaugurated its additional investment in the factory for large
size bearings in Dalian, China, which doubles the manufacturing
capacity.
• signed a Memorandum of Understanding with Sinovel Wind Co.
Ltd for strategic partnership, and a series of contracts with a
value exceeding SEK 330 m for main shaft bearings and sealing
systems for 3MW wind turbines.
• signed a service contract with Transocean. The contract is
worth SEK 10 m and covers asset reliability services for 59 of
Transocean's drilling rigs.
• was selected as the sector leader for the IEQ Industrial
Engineering sector in the 2009 Dow Jones Sustainability
Indexes (DJSI). SKF was also included in the FTSE4Good Index
Series, for the ninth year in succession.
20 October 2009

5. Highlights Q3 2009 4
SKF launched 11 new solutions to help customers increase equipment
reliability, reduce maintenance costs and environmental impact:
Sealed spherical Super precision Y-bearings
roller bearings bearings
Machine
condition advisor
Actuators
Profile rail guides
Telescopic pillar system Wind turbine blade Oil conditioning unit
bearing grease
Large diameter sealing solutions Sealing solutions
for screw
compressors
20 October 2009

6. Third quarter 2009 5
SEKm 2009 2008
Net sales 13,324 15,381
Operating profit 957* 2,085
Operating margin 7.2% 13.6%
Operating margin excl. restructuring, % 8.7% 13.6%
Profit before taxes 689 1,859
Net profit 483 1,257
Basic earnings per share, SEK 1.01 2.67
Cash flow after investments before
financial items 1,359 -526
* Q3 restructuring around SEK 200 m
Operating profit excl. restructuring activities SEK 1,157 m
20 October 2009

7. First nine months 2009 6
SEKm 2009 2008
Net sales 42,340 47,054
Operating profit 2,199* 6,260
Operating margin 5.2% 13.3%
Operating margin excl. restructuring, % 7.3% 13.3%
Profit before taxes 1,532 5,761
Net profit 1,200 3,922
Basic earnings per share, SEK 2.56 8.39
Cash flow after investments before
financial items 4,307 215
* YTD September restructuring around SEK 875 m
Operating profit excl. restructuring activities SEK 3,074 m
20 October 2009

8. Growth in local currency 7
(Organic growth + Acquisition/Divestments)
Long-term target level: 6-8% per annum
% y-o-y
15 13.2%
10 7.1%
5 -20.8%
0
-5
-10
-15
-20
-25
2007 2008 YTD September
2009
Organic growth
Acquisitions/Divestments
20 October 2009

9. Sales in local currencies (excl. structural changes) 8
% change y-o-y
15
10
5
0
-5
-10
-15
-20
-25
-30
2007 2008 2009
20 October 2009

10. Sales volume 9
% change y-o-y
10
5
0
-5
-10
-15
-20
-25
-30
-35
2007 2008 2009
20 October 2009

11. Components in net sales 10
2007 2008 2009
Percent y-o-y Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Volume 7.9 6.9 9.0 6.3 4.9 6.2 2.7 -13.0 -26.9 -30.8 -24.9
Structure 4.0 4.6 3.7 1.0 1.0 1.3 0.5 2.4 1.4 1.1 1.2
Price / Mix 1.8 2.7 2.0 3.2 3.8 4.0 6.4 8.5 7.1 5.6 3.7
Sales in local 13.7 14.2 14.7 10.5 9.7 11.5 9.6 -2.1 -18.4 -24.1 -20.0
currency
Currency -5.6 -2.3 -1.9 -2.0 -1.2 -4.1 -0.9 10.3 13.6 12.2 6.6
Net sales 8.1 11.9 12.8 8.5 8.5 7.4 8.7 8.2 -4.8 -11.9 -13.4
20 October 2009

12. Operating margin 11
Long-term target level: 12%
%
14
13.3* 12.7*
12
12.9
10 12.2
7.3*
8
6
4 5.2
2
0
2007 2008 YTD September
2009
Restructuring and one-time items
* Excluding restructuring and one-time items
20 October 2009

13. Operating margin 12
Long-term target level: 12%
%
16
14
12
10
8
6
4
2
0
2007 2008 2009
Restructuring and one-time items
20 October 2009

14. Operating margin per division 13
%
18
16
14
12 Service
10
8
6 Industrial
4
2 Automotive
0
-2
-4
-6
-8
-10
-12
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2007 2008 2009
Excluding one-off items (eg. restructuring,
impairments, capital gains)
20 October 2009

15. Activities to adapt to lower demand 14
• Restructuring/impairment activities
People Costs charged to
operating profit
Q4 2008 2,500 SEK 340 m
Q1 2009 500 SEK 175 m
Q2 2009 900 SEK 500 m
Q3 2009 70 SEK 200 m
3,970 SEK 1,215 m
At the end of September 2009, around 4,400 people have left
the Group since the third quarter last year, of which around
2,500 people under the programmes.
Total savings from these activities around SEK 800 m.
• In addition, around 14,000 people in short-time working end of
September 2009.
20 October 2009

16. Inventories as % of annual sales 15
% Long-term target level: 18%
25
24
23
22
21
20
19
18
2007 2008 2009
20 October 2009

17. Return on capital employed 16
Long-term target level: 24%
%
30
24.9 24.0
25
20
15
10.2
10
5
0
2007 2008 YTD September
2009
ROCE: Operating profit plus interest income, as a percentage of
twelve months average of total assets less the average of non-
interest bearing liabilities.
20 October 2009

18. Net debt 17
(Short-term financial assets minus loans and post-employment benefits)
SEKm
0
AB SKF,
-2 000
dividend paid (SEKm):
-4 000 2007 Q2 2,049
-6 000 2008 Q2 2,277
-8 000 2009 Q2 1,594
-10 000
Redemption (SEKm):
-12 000
2007 Q2 4,554
-14 000
2008 Q2 2,277
-16 000
-18 000
2007 2008 2009
20 October 2009

19. AB SKF, debt structure 18
Amount in million Maturity
Euro Bond EUR 132* 2010-06
SEK Bond SEK 1,500 2011-06
Term loan in euro EUR 150 2013-06
Euro Bond EUR 500 2013-12
Euro loans EUR 130 2014-03
Euro loan EUR 100 2016-06
* Was EUR 250 million, reduced by EUR 118 million in Q2.
20 October 2009

20. Cash flow, after investments before financial items 19
SEKm
2 500
Cash out from
2 000 acquisitions* (SEKm):
1 500 2007 1,209
2008 1,284
1 000
2009 239
500
0
-500
-1 000
2007 2008 2009
* including non-controlling interests.
20 October 2009

21. October 2009: Outlook for the fourth quarter 200920
Sales development compared to fourth quarter last year
The demand for SKF products and services is expected to be significantly
lower for the Group in total and in Europe and North America. In Asia it is
expected to be unchanged and in Latin America slightly higher. It is expected
to be unchanged for the Automotive Division but significantly lower for the
Industrial Division and Service Division.
Sales development compared to the third quarter this year
The demand is expected to be slightly higher for the SKF Group in total. It is
expected to be relatively unchanged in Europe and North America and slightly
higher in Asia and Latin America. It is expected to be relatively unchanged for
the Automotive Division and slightly higher for both the Service Division and
the Industrial Division.
Manufacturing level
The manufacturing level will be significantly lower year on year and slightly
higher compared to the third quarter.
20 October 2009

22. Volume trends 21
(based on current assumptions)
Net sales Daily volume trends for: Outlook Q4
2008 Q3 2009 Q4 2009 2009 vs 2008
Europe 56% ---
North America 17% ---
Asia Pacific 19% =
Latin America 5% +
Total ---
20 October 2009

23. Sequential volume trend main segments Q4 2009 22
(based on current assumptions)
Net sales 2008
5% Aerospace
13% Cars
12% Industrial OEM, Heavy+Off-highway
9% Vehicle Service Market
6% Energy
5% Trucks
23% Industrial distribution
20% Industrial OEM, General+Special
3% Railway
3% Electrical and two-wheeler
20 October 2009

24. Guidance for the fourth quarter 2009 23
• Tax level: around 30%
• Financial net for the fourth quarter:
Around SEK -200 million
• Exchange rates on operating profit versus 2008
Q4: +0
-
Full year: SEK 750 million
• Additions to PPE: Around SEK 2 billion for 2009
Guidance is approximate and based on current assumptions and exchange rates.
20 October 2009

25. Key focus areas ahead 2009 24
• Profit and cash flow
- maintain positive price/mix
- drive operational efficiency and cost reduction
- reduce working capital and investments
• Adjustment of manufacturing output to new demand levels
- restructuring
- short-time working
• Growing segments and geographies
• Strengthening the platform/segment approach
• Competence development
SKF Care and Six Sigma as guiding lights
20 October 2009

26. SKF Care 25
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
20 October 2009

27. SKF Group Vision 26
To equip the world
with SKF knowledge
20 October 2009

28. Cautionary statement 27
This presentation contains forward-looking statements that are based on the
current expectations of the management of SKF.
Although management believes that the expectations reflected in such forward-
looking statements are reasonable, no assurance can be given that such
expectations will prove to have been correct. Accordingly, results could differ
materially from those implied in the forward-looking statements as a result of,
among other factors, changes in economic, market and competitive conditions,
changes in the regulatory environment and other government actions, fluctuations
in exchange rates and other factors mentioned in SKF's latest annual report
(available on www.skf.com) under the Administration Report; "Most important
factors influencing the financial results", "Financial risks" and "Sensitivity analysis”.
20 October 2009

29. 28
20 October 2009