Company’s adjusted operating profit fell to SEK 3.1 billion due to currency headwinds
STOCKHOLM: Sweden’s SKF (SKFb.ST) said on Monday it has agreed to sell its precision elastomeric device (PED) operation in Elgin, Illinois, to Carco PRP Group for an estimated enterprise value of USD 70 million, as part of its strategy to streamline its aerospace portfolio and exit non-core businesses.
The Elgin unit, which generated SEK 260 million in sales in 2024, is expected to close in the fourth quarter of 2025, pending regulatory approvals. The move follows the completed divestment of SKF’s Hanover operation in April, marking the full execution of its aerospace strategic review.
“The Hanover and Elgin divestments are examples of our ongoing efforts to execute on our strategy and manage our portfolio to accelerate profitable growth,” said Thomas Fröst, President of Independent and Emerging Business at SKF.
SKF will now concentrate on its core aerospace segments—namely aeroengine and aerostructure bearing offerings—which account for approximately SEK 6 billion in annual sales. The company plans to boost these areas through increased investments in digitalization, automation, and factory modernization.
The announcement comes alongside SKF’s Q2 earnings report, which showed net sales of SEK 23.2 billion, down from SEK 25.6 billion a year earlier. Organic growth declined 0.2%, weighed by weak automotive demand, while the industrial segment posted gains. Adjusted operating profit fell to SEK 3.1 billion due to currency headwinds, though margins improved slightly to 13.3%.
CEO Rickard Gustafson said the company’s margin resilience reflects strong pricing, portfolio management, and cost control. He added that ongoing rightsizing efforts, including a net reduction of 1,200 positions in Europe, are expected to yield SEK 2 billion in annual savings by 2027.
Despite global economic uncertainty, SKF expects organic sales to remain flat in Q3. Currency effects are projected to negatively impact operating profit by SEK 500 million.