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Trelleborg Earnings Release 2012

Apr 19, 2012

2985_10-q_2012-04-19_fbfec6d0-7468-4bb9-a347-ac74116efe4d.pdf

Earnings Release

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First quarter 2012

President and CEO Peter Nilsson

"The first quarter of 2012 was so far the best operational quarter for Trelleborg. The favorable demand in the majority of segments resulted in an increase in organic sales of 7 percent.

In the offshore oil/gas segment in Trelleborg Engineered Systems, there was a significant improvement. The segment has during previous quarters recorded lower sales and earnings mainly due to production disruptions.

The pace of change remained brisk within the Group. Events during the quarter included the divestment of an operation and organizational changes that strengthened and focused the Group

During the quarter, we signed final agreements with Freudenberg concerning the formation of a joint venture in antivibration solutions for light and heavy vehicles. We expect approval of the relevant competition authorities during summer.

The market is characterized by great uncertainty, but our preparedness to manage a volatile market is good."

Continuing operations:

  • Net sales during the first quarter of 2012 increased to SEK 7,773 M (7,226). Organic sales rose 7 percent (19).
  • Operating profit amounted to SEK 744 M (645). Items affecting comparability amounted to an expense of SEK 28 M (expense: 9). Operating profit excluding items affecting comparability totaled SEK 772 M (654).
  • The EBITDA margin, excluding items affecting comparability, was 12.8 percent (12.1).
  • Net profit amounted to SEK 501 M (423) and earnings per share increased to SEK 1.80 (1.55). Earnings per share excluding items affecting comparability were SEK 1.90 (1.55).
  • The operating cash flow was negative in the amount of SEK 193 M (neg: 182). Free cash flow was negative in the amount of SEK 454 M (neg: 528).

The Group in total:

Consolidated net sales totaled SEK 7,773 M (7,270). Operating profit amounted to SEK 744 M (9051 ).

Key ratios, continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Net sales 7,773 7,226 29,653 29,106
Operating profit 744 645 2,530 2,431
Net profit 501 423 1,656 1,578
Earnings per share, SEK 1.80 1.55 6.00 5.75

Market outlook for the second quarter 2012. Demand is expected to be in line with the first quarter of 2012, adjusted for seasonal variations. Market outlook for the second quarter 2012

1 Including the divestment of the roofing operation that generated a positive earnings effect after tax of SEK 262 M.

The Group, January – March 2012

Key ratios, continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Net sales 7,773 7,226 29,653 29,106
Operating profit 744 645 2,530 2,431
Profit before tax 689 602 2,309 2,222
Net profit 501 423 1,656 1,578
- equity holders of the parent 494 417 1,636 1,559
- non-controlling interest 7 6 20 19
Earnings per share, SEK 1.80 1.55 6.00 5.75

Organic sales increased 7 percent (19)

Net sales. The Trelleborg Group's net sales for the first quarter of 2012 for continuing operations totaled SEK 7,773 M (7,226), an increase of 8 percent (10). Organic sales increased 7 percent (19). The effects of structural changes were 0 percent (1) while exchange-rate effects were a positive 1 percent (neg: 10).

Change in net sales, continuing operations Jan - Mar Jan - Mar
% 2012 2011
Organic sales +7 +19
Structural changes 0 + 1
Exchange-rate effects +1 -10
Total +8 +10

The Group's sales in all segments surpassed the levels recorded in the first quarter of 2011.

Sales to the segment infrastructure construction was on a par with the fourth quarter of 2011, adjusted for seasonal effects. Sales to the other segments were higher compared to the fourth quarter of 2011, adjusted for seasonal effects.

Operating profit rose to SEK 744 M (645)

Earnings. Operating profit for the quarter increased to SEK 744 M (645). Currency translation effects had a negative impact on operating profit of approximately SEK 10 M compared with the corresponding period in 2011.

The financial net expense was SEK 55 M (expense: 43), corresponding to an average interest rate of 3.3 percent (2.7).

Profit before tax increased to SEK 689 M (602).

Net profit amounted to SEK 501 M (423) and the tax rate was 27 percent (30).

Earnings per share were SEK 1.80 (1.55).

Operating profit, excluding items affecting comparability, increased to SEK 772 M (654). Items affecting comparability pertaining to restructuring costs within the previously announced scope for structural projects had a negative impact on earnings of SEK 28 M (neg: 9). The operating margin was 9.9 percent (9.0). Operating profit before depreciation and amortization (EBITDA) rose to SEK 1,000 M (874). The EBITDA margin was 12.8 percent (12.1). Earnings per share, excluding items affecting comparability, totaled SEK 1.90 (1.55).

EBITDA margin amounted to 12.8 percent (12.1)

Operating key ratios, continuing operations
excl. items affecting comparability Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Operating profit 772 654 2,753 2,635
Operating margin (ROS), % 9.9 9.0 9.2 9.0
EBITDA, % 12.8 12.1 12.3 12.1
Earnings per share, SEK 1.90 1.55 6.65 6.30

Sales within the offshore oil/gas segment in Trelleborg Engineered Systems rose during the quarter in relation to the preceding quarter. The previously communicated problems have been resolved and development in the segment is progressing toward a steady and clear stepwise improvement in orders received as well as sales, in addition to improved earnings.

Return. The return on capital employed, excluding items affecting comparability, for the past 12-month period was 13.8 percent (full-year 2011: 13.5), while the return on shareholders' equity, excluding items affecting comparability, was 13.9 percent for the same period (full-year 2011: 13.4).

Continuing
operations
Excl. items affecting
comparability
Apr 2011 - Full year Apr 2011 - Full year
% Mar 2012 2011 Mar 2012 2011
Return on capital employed, ROCE 12.8 12.6 13.8 13.5
Return on shareholders' equity 12.6 12.3 13.9 13.4

Cash flow. Operating cash flow for the period amounted to a negative SEK 193 M (neg: 182). Compared with the preceding quarter, cash flow was impacted by seasonal effects. The higher level of sales increased tied-up working capital during the period. The higher level of capital expenditure amounting to SEK 219 M (161) also adversely impacted cash flow. Free cash flow was negative at SEK 454 M (neg: 528).

Continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Operating cash flow -193 -182 1,644 1,655
Utilization of restructuring provisions -51 -37 -308 -294
Dividend - non-controlling interest 0 - -3 -3
Financial items -102 -205 -181 -284
Paid tax -108 -104 -484 -480
Free cash flow -454 -528 668 594

Return on shareholders' equity was 13.9 percent (13.4)

Free cash flow was negative SEK 454 M (neg: 528)

Debt/equity ratio was 48 percent (51)

Net debt. Compared with the preceding quarter, net debt grew by SEK 193 M to SEK -6,618 M (-6,388).

The debt/equity ratio was 48 percent (51). Net debt in relation to EBITDA was 1.8 (1.9).

Change in net debt Jan - Mar Jan - Mar Full year
SEK M 2012 2011 2011
Net debt, opening balance -6,425 -6,409 -6,409
Net cash flow for the period -342 -430 -67
Disposals - 139 98
Exchange rate differences 149 312 -47
Net debt, closing balance -6,618 -6,388 -6,425
Debt/equity ratio, % 48 51 48
Net Debt/EBITDA excl items aff comp. 1.8 1.9 1.8

Important events during the quarter

Structural changes January-March 2012

Agreement on the formation of a joint venture in antivibration solutions. The final agreements concerning the formation of the joint venture in antivibration solutions for light and heavy vehicles were signed. Completion of the transaction is subject to approval of the relevant competition authorities.

Background: Trelleborg and Freudenberg intend to form a 50/50 jointventure company in antivibration solutions for light and heavy vehicles. Trelleborg and Freudenberg currently command strong positions in the market. The companies' customer portfolios complement each other favorably, while Trelleborg's broad geographical presence is complemented by Freudenberg's product portfolio. Overall, this means that the company will attain a world-leading position and will be able to offer automakers across the globe the market's best geographical coverage and the broadest portfolio in antivibration solutions.

The new company will comprise of Trelleborg Automotive and Freudenberg's operations in antivibration solutions, Vibracoustic. At yearend, the combined annual sales were approximately SEK 13.4 billion, of which Trelleborg Automotive accounted for approximately SEK 7.1 billion.

Trelleborg strengthens and focuses the Group. The Trelleborg Group implemented organizational changes in order to strengthen and focus the company.

Trelleborg Automotive in being focused on antivibration solutions. Trelleborg Automotive's other operations – polymer boots for drive shafts and steering applications and noise-damping solutions for brake systems – are being strengthened by integrating them into Trelleborg Engineered Systems and Trelleborg Sealing Solutions, respectively.

Trelleborg Engineered Systems is being focused on three prioritized areas: offshore and infrastructure construction, general industrial applications and polymer-coated fabrics for advanced industrial applications. As a consequence, three people will assume new positions in Trelleborg's Group Management: Fredrik Meuller, Mikael Fryklund and Dario Porta. Trelleborg's President and CEO Peter Nilsson will assume responsibility for Trelleborg Engineered Systems.

Lennart Johansson, Trelleborg Engineered Systems' current President, and current President of Trelleborg Automotive, Jim Law, have been appointed as the Trelleborg Group's representatives on the management board of the joint venture in antivibration solutions for light and heavy vehicles that is planned between Trelleborg and Freudenberg. Trelleborg's President and CEO Peter Nilsson will become the company's Chairman.

On account of the organizational changes, previously reported quarterly data for the business areas in 2010 and 2011 has been restated to coincide with the new operational structure.

Information on the key figures was published in a press release on April 17, 2012.

Divestment of the light-vehicle component operation. Trelleborg completed the divestment of the operation that manufactures hightechnology rubber, plastic and foam components and systems for the light vehicles industry. The operation is primarily located in France and was part of the Trelleborg Automotive business area. The buyer is Bavaria Industriekapital AG with its registered office in Munich, Germany. The divestment is a further step in the Trelleborg Group's strategy of focusing on selected segments.

Agreement on the formation of a joint venture in antivibration solutions

Organisational changes

New quarterly data

Completed divestment of the light-vehicle component operation

Agreement to divest protective products operation

Events after the close of the period

Divestment of protective products operation Trelleborg has signed an agreement for the divestment of an operation that produces high-technology protective products for professional users. Operations are mainly based in Sweden and Lithuania and are part of Trelleborg Engineered Systems. The buyer is Ansell Limited whose operational head office is in Red Bank, New Jersey, in the US. The divestment is a further step in the Trelleborg Group's strategy of focusing on selected segments. The divested operation had annual sales of approximately SEK 170 M during 2011. The purchase consideration amounted to approximately SEK 210 M and is expected to lead to a capital gain in accounting terms of approximately SEK 130 M after tax. The transaction is expected to be finalized in the second quarter of 2012.

Risk management

Risk/risk management at Trelleborg. Trelleborg focuses continuously on identifying, evaluating and managing risks arising in the Group's companies, business areas, business units and processes. Trelleborg has an Enterprise Risk Management process (ERM process) which aims to provide a Groupwide overview of Trelleborg's risks, deliver a basis for risk management decisions and enable assessment of the risks and of how they are managed.

The principal risks and uncertainties currently faced by the Group relate to the economy's effect on demand, supply and price movements of raw materials and components, structural programs and financial business environment risks.

For further information regarding the Group's risks, risk exposure and risk management, refer to the Trelleborg Annual Report and www.trelleborg.com.

The Group's market outlook

Market outlook for the second quarter of 2012. Demand is expected to be in line with the first quarter of 2012, adjusted for seasonal variations.

Outlook from the year-end report published on February 15, 2012: Market outlook for the first quarter of 2012. Demand is expected to be in line with or slightly higher than the fourth quarter of 2011, adjusted for seasonal variations.

Trelleborg, April 19, 2012 Board of Directors of Trelleborg AB (publ)

This report has been prepared in accordance with IAS 34 Interim Financial Reporting and applicable rules of the Annual Accounts Act. The interim report for the Parent Company has been prepared in accordance with Chapter 9 of the Annual Accounts Act, Interim Reports. Unless otherwise stated, the accounting policies applied by the Group and Parent Company correspond to the accounting policies applied in the preparation of the most recent annual report.

This report has not been subject to special review by the company's auditors.

_____________________________________________________________

Trelleborg Wheel Systems

Continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Excluding items affecting comparability
Net sales 1,128 950 4,041 3,863
Operating profit 156 96 461 401
Operating margin (ROS), % 13.8 10.1 11.4 10.4
EBITDA margin, % 15.9 12.1 13.8 12.7
Operating cash flow -125 -153 213 185
Including items affecting comparability
Operating profit 156 96 461 401
ROS, % 13.8 10.1 11.4 10.4

Additional key ratios on pages 14 - 17

Market trend. Underlying demand remained high compared with the yearearlier period.

Net sales. Net sales during the quarter rose 19 percent compared with the year-earlier period. Organic sales increased 18 percent, structural changes represented a positive 1 percent and exchange-rate effects were 0 percent.

Operating profit and cash flow. Operating profit increased significantly compared with the first quarter of 2011. The operating margin was impacted by a favorable product mix, where sales in prioritized segments were particularly strong. Margins were also affected by high capacity utilization.

Operating cash flow was charged mainly with tied-up working capital driven by volume increases.

Other. The integration of acquired units is proceeding according to plan and the new operations are strengthening the business area's earnings. A brand consolidation process was initiated for the materials-handling vehicles operation. The operation mainly focused on the production of agricultural tires in Xingtai, in eastern China, will officially be inaugurated, as planned, at the end of the second quarter of 2012.

Continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Excluding items affecting comparability
Net sales 1,973 1,813 7,448 7,288
Operating profit 429 352 1,572 1,495
Operating margin (ROS), % 21.7 19.4 21.1 20.5
EBITDA margin, % 24.4 21.9 23.9 23.3
Operating cash flow 264 202 1,423 1,361
Including items affecting comparability
Operating profit 426 349 1,552 1,475
ROS, % 21.6 19.3 20.8 20.2

Trelleborg Sealing Solutions

Additional key ratios on pages 14 - 17

Market trend. Underlying demand was favorable in most main segments, especially aerospace, and in the majority of geographical areas.

Net sales. Net sales for the quarter rose 9 percent compared with the yearearlier period. Organic sales increased 4 percent, effects of structural changes represented a positive 3 percent and exchange-rate effects were a positive 2 percent.

Operating profit and cash flow. Operating profit improved significantly compared with the year-earlier period as a result of healthy volumes, particularly in the aerospace segment, effective cost control and good capacity utilization.

Operating cash flow remained strong due to favorable earnings generation and continued efficient management of working capital.

Other. Previously, decisions were taken regarding new investments in the Life Science segment in the form of expanded production capacity in Europe and establishment of a new full-scale production unit in North America. The business area continues to focus on selected segments.

Using digital technologies, the business area continued to further develop market-oriented activities with the aim of additionally strengthening its relationships with the customer and the market.

Organizational changes were implemented aimed at strengthening and focusing the Group (see page 5). From Trelleborg Automotive, the noisedamping solutions for brake systems operation was integrated into the business area.

Continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Excluding items affecting comparability
Net sales 2,818 2,607 10,768 10,557
Operating profit 164 203 687 726
Operating margin (ROS), % 5.8 7.8 6.4 6.9
EBITDA margin, % 9.0 11.1 9.6 10.1
Operating cash flow -148 -52 277 373
Including items affecting comparability
Operating profit 158 206 590 638
ROS, % 5.6 7.9 5.5 6.0

Trelleborg Engineered Systems

Additional key ratios on pages 14 - 17

Market trend. The underlying market in the general industry segment performed favorably. Inquiries in the offshore oil/gas segment are at a high level.

Net sales. Net sales rose 8 percent compared with the corresponding period in the preceding year. Organic sales increased 6 percent, effects of structural changes were 0 percent and exchange-rate effects were 2 percent.

Operating profit and cash flow. Operating profit was lower compared with the year-earlier period due mainly to a less favorable product mix and continued start-up costs in Brazil.

Operating cash flow was lower during the quarter than in the corresponding period in 2011, which was primarily attributable to higher sales and a higher level of tied-up capital as well as lower earnings.

Other. Sales in the offshore oil/gas segment in Trelleborg Engineered Systems were healthy during the quarter. The previously communicated problems have been resolved and development in the segment is progressing toward a steady and distinct improvement with rising orders received and sales and improved earnings.

Organizational changes were carried out with the aim of strengthening and focusing the Group (see page 5). From Trelleborg Automotive, the operation for polymer boots for drive shafts and steering applications was integrated into the business area.

After the close of the period, an agreement was signed to divest the protective products operation (see page 6).

Trelleborg Automotive

Continuing operations Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Excluding items affecting comparability
Net sales 1,890 1,712 7,290 7,112
Operating profit 90 61 339 310
Operating margin (ROS), % 4.6 3.4 4.5 4.2
EBITDA margin, % 7.5 6.9 7.7 7.5
Operating cash flow -69 -177 167 59
Including items affecting comparability
Operating profit 81 53 272 244
ROS, % 4.1 2.9 3.6 3.3

Additional key ratios on pages 14 - 17

Market trend. Global production and sales of light vehicles remained positive during the quarter, with favorable growth in North America and parts of Asia. In Europe, the trend has been mixed.

Net sales. Net sales during the quarter rose 10 percent compared with the year-earlier period as a result of favorable demand and a positive customer mix. Organic sales increased 8 percent, effects of structural changes represented a positive 2 percent and exchange-rate effects were 0 percent.

Operating profit and cash flow. The operating profit and operating margin in the quarter were higher than in the corresponding period in 2011 as a result of increased volumes and a favorable customer mix. Earnings were affected by costs associated with the formation of the planned joint venture in antivibration solutions and by adjustments of the operation in Brazil to current and future market trends.

Operating cash flow was charged mainly with tied-up working capital driven by volume increases.

Other. Final agreements were signed covering the formation of the joint venture in antivibration solutions for light and heavy vehicles between Trelleborg and Freudenberg (see page 5).

Organizational changes were implemented aimed at strengthening and focusing the Group (see page 5). Trelleborg Automotive is being focused on antivibration solutions.

The divestment of a light-vehicles component operation was completed (see page 5).

Financial statements

Income Statements
Group Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Continuing operations
Net sales 7,773 7,226 29,653 29,106
Cost of goods sold -5,684 -5,325 -21,842 -21,483
Gross profit 2,089 1,901 7,811 7,623
Selling expenses -558 -543 -2,215 -2,200
Administrative expenses -649 -597 -2,642 -2,590
Research and development costs -152 -146 -580 -574
Other operating income/expenses 10 27 144 161
Profit from part. in assoc. companies 4 3 12 11
Operating profit 744 645 2,530 2,431
Financial income and expenses -55 -43 -221 -209
Profit before tax 689 602 2,309 2,222
Tax -188 -179 -653 -644
Net profit 501 423 1,656 1,578
Discontinued operations
Net sales - 44 0 44
Operating profit - 260 -2 258
Profit before tax - 260 -2 258
Net profit - 262 -2 260
Group, total
Net sales 7,773 7,270 29,653 29,150
Operating profit 744 905 2,528 2,689
Profit before tax 689 862 2,307 2,480
Total net profit 501 685 1,654 1,838
of which attributable to:
- equity holders of the parent 494 679 1,634 1,819
- non-controlling interest 7 6 20 19
Earnings per share Jan - Mar Jan - Mar Apr 2011 - Full year
SEK 2012 2011 Mar 2012 2011
Continuing operations 1.80 1.55 6.00 5.75
Discontinued operations 0.00 0.95 0.00 0.95
Group, total 1.80 2.50 6.00 6.70
Number of shares
End of period 271,071,783 271,071,783 271,071,783 271,071,783
Average number 271,071,783 271,071,783 271,071,783 271,071,783

Statements of comprehensive income

Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Total net profit 501 685 1,654 1,838
Other comprehensive income
Cash flow hedges 22 39 -91 -74
Hedging of net investment 186 232 -118 -72
Translation difference -467 -546 94 15
Income tax relating to components of other
comprehensive income -50 -64 60 46
Other comprehensive income, net of tax -309 -339 -55 -85
Total comprehensive income 192 346 1,599 1,753
Total profit for the period
- equity holders of the parent 189 346 1,576 1,733
- non-controlling interest 3 0 23 20
Group Mar 31 Mar 31 Dec 31
SEK M 2012 2011 2011
Property, plant and equipment 5,716 5,518 5,958
Intangible assets 10,248 9,873 10,457
Financial assets 1,292 1,343 1,284
Total non-current assets 17,256 16,734 17,699
Inventories 3,927 3,665 4,001
Current operating receivables 6,952 6,271 6,025
Current interest-bearing receivables 221 94 213
Cash and cash equivalents 757 704 753
Total current assets 11,857 10,734 10,992
Total assets 29,113 27,468 28,691
Equity holders of the parent 13,527 12,425 13,338
Non-controlling interest 169 118 166
Total equity 13,696 12,543 13,504
Non-current interest-bearing liabilities 5,820 4,674 5,452
Other non-current liabilities 1,058 1,092 1,125
Total non-current liabilities 6,878 5,766 6,577
Interest-bearing current liabilities 2,040 2,751 2,171
Other current liabilities 6,499 6,408 6,439
Total current liabilities 8,539 9,159 8,610
Total equity and liabilities 29,113 27,468 28,691
Specification of changes in equity Mar 31 Mar 31 Dec 31
SEK M 2012 2011 2011
Attributable to equity holders of the parent
Opening balance, January 1 13,338 12,079 12,079
Total comprehensive income 189 346 1,733
Dividend - - -474
Closing balance 13,527 12,425 13,338
Attributable to non-controlling interest
Opening balance, January 1 166 117 117
Total comprehensive income 3 - 20
Acquisition - 1 32
Dividend 0 - -3
Closing balance 169 118 166
Sum total equity, closing balance 13,696 12,543 13,504
Group Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Operating activities
Operating profit 744 645 2,530 2,431
Adjustments for items not included in cash flow:
Depreciation, property, plant and equipment 201 192 806 797
Amortization, intangible assets 23 28 108 113
Impairment losses, property, plant and equipment 4 - 10 6
Impairment losses, intangible assets - - -3 -3
Provision for restructuring costs 28 9 213 194
Other, non cash-flow affecting items -12 -4 -40 -32
988 870 3,624 3,506
Interest received and other financial items 5 - 22 17
Interest paid and other financial items -107 -205 -203 -301
Taxes paid -108 -104 -484 -480
Cash flow from operating activities before changes in working
capital 778 561 2,959 2,742
Cash flow from changes in working capital:
Change in inventories -49 -292 -251 -494
Change in operating receivables -1,024 -699 -626 -301
Change in operating liabilities 78 95 23 40
Utilization of restructuring provisions -51 -37 -308 -294
Cash flow from operating activities -268 -372 1,797 1,693
Investing activities
Acquisitions - -329 -417 -746
Disposals 112 427 244 559
Capital expenditure, property, plant and equipment -206 -155 -1,125 -1,074
Capital expenditure in intangible assets -13 -6 -68 -61
Sale of non-current assets 33 5 67 39
Cash flow from investing activities -74 -58 -1,299 -1,283
Financing activities
Change in interest-bearing investments 118 307 -341 -152
Change in interest-bearing liabilities 247 32 368 153
Dividend - equity holders of the parent - - -474 -474
Dividend - non-controlling interest 0 - -3 -3
Cash flow from financing activities 365 339 -450 -476
Cash flow for the period 23 -91 48 -66
Cash and cash equivalents:
At beginning of the period 753 832 704 832
Exchange rate differences -19 -37 5 -13
Cash and cash equivalents at end of period 757 704 757 753

Cash flow statements

TRELLEBORG AB INTERIM REPORT JANUARY – MARCH 2012

Group review
Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Continuing operations excluding items
affecting comparability
Net sales 7,773 7,226 29,653 29,106
EBITDA 1,000 874 3,664 3,538
Operating profit 772 654 2,753 2,635
Net profit 521 429 1,819 1,727
Net sales Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Continuing operations
Trelleborg Wheel Systems 1,128 950 4,041 3,863
Trelleborg Sealing Solutions 1,973 1,813 7,448 7,288
Trelleborg Engineered Systems 2,818 2,607 10,768 10,557
Trelleborg Automotive 1,890 1,712 7,290 7,112
Other companies 95 264 580 749
Eliminations -131 -120 -474 -463
Total 7,773 7,226 29,653 29,106
EBITDA Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 179 115 556 492
Trelleborg Sealing Solutions 481 397 1,781 1,697
Trelleborg Engineered Systems 255 290 1,031 1,066
Trelleborg Automotive 146 121 572 547
Other companies -1 -1 -9 -9
Group items -60 -48 -267 -255
Total excl. items affecting comparability 1,000 874 3,664 3,538
Items affecting comparability
Trelleborg Wheel Systems - - - -
Trelleborg Sealing Solutions -3 -3 -21 -21
Trelleborg Engineered Systems -6 3 -91 -82
Trelleborg Automotive -9 -8 -64 -63
Other companies - -1 -26 -27
Group items -10 - -11 -1
Total items affecting comparability -28 -9 -213 -194
Total incl. items affecting comparability 972 865 3,451 3,344
EBITDA Jan - Mar Jan - Mar Apr 2011 - Full year
EBITDA Jan - Mar Jan - Mar Apr 2011 - Full year
% 2012 2011 Mar 2012 2011
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 15.9 12.1 13.8 12.7
Trelleborg Sealing Solutions 24.4 21.9 23.9 23.3
Trelleborg Engineered Systems 9.0 11.1 9.6 10.1
Trelleborg Automotive 7.5 6.9 7.7 7.5
Total excl. items affecting comparability 12.8 12.1 12.3 12.1
Including items affecting comparability
Trelleborg Wheel Systems 15.9 12.1 13.8 12.7
Trelleborg Sealing Solutions 24.3 21.7 23.6 23.0
Trelleborg Engineered Systems 8.8 11.3 8.7 9.3
Trelleborg Automotive 7.0 6.4 6.8 6.6
Total incl. items affecting comparability 12.5 11.9 11.6 11.4

TRELLEBORG AB INTERIM REPORT JANUARY – MARCH 2012

Operating profit Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 156 96 461 401
Trelleborg Sealing Solutions 429 352 1,572 1,495
Trelleborg Engineered Systems 164 203 687 726
Trelleborg Automotive 90 61 339 310
Other companies -3 -8 -28 -33
Group items -64 -50 -278 -264
Total excl. items affecting comparability 772 654 2,753 2,635
Items affecting comparability
Trelleborg Wheel Systems - - - 0
Trelleborg Sealing Solutions -3 -3 -20 -20
Trelleborg Engineered Systems -6 3 -97 -88
Trelleborg Automotive -9 -8 -67 -66
Other companies - -1 -26 -27
Group items -10 - -13 -3
Total items affecting comparability -28 -9 -223 -204
Total incl. items affecting comparability 744 645 2,530 2,431
Operating margin, (ROS) Jan - Mar Jan - Mar Apr 2011 - Full year
% 2012 2011 Mar 2012 2011
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 13.8 10.1 11.4 10.4
Trelleborg Sealing Solutions 21.7 19.4 21.1 20.5
Trelleborg Engineered Systems 5.8 7.8 6.4 6.9
Trelleborg Automotive 4.6 3.4 4.5 4.2
Total excl. items affecting comparability 9.9 9.0 9.2 9.0
Including items affecting comparability
Trelleborg Wheel Systems 13.8 10.1 11.4 10.4
Trelleborg Sealing Solutions 21.6 19.3 20.8 20.2
Trelleborg Engineered Systems 5.6 7.9 5.5 6.0
Trelleborg Automotive 4.1 2.9 3.6 3.3
Total incl. items affecting comparability 9.5 8.9 8.5 8.3
Capital employed Mar 31 Mar 31 Dec 31
SEK M 2012 2011 2011
Continuing operations
Trelleborg Wheel Systems 2,395 2,150 2,191
Trelleborg Sealing Solutions 7,373 6,839 7,339
Trelleborg Engineered Systems 7,504 6,814 7,315
Trelleborg Automotive 2,915 2,772 2,824
Other companies -19 227 184
Group items -43 -170 -172
Provision for restructuring costs and legal costs -83 -185 -107
Total 20,042 18,447 19,574
Return on capital employed, (ROCE) Apr 2011 - Apr 2010 - Full year
% Mar 2012 Mar 2011 2011
Continuing operations excluding items affecting comparability
Trelleborg Wheel Systems 20.1 14.9 18.2
Trelleborg Sealing Solutions 21.4 16.4 20.7
Trelleborg Engineered Systems 9.3 13.8 10.1
Trelleborg Automotive 11.9 11.9 11.1
Total excluding items affecting comparability 13.8 12.8 13.5
Including items affecting comparability
Trelleborg Wheel Systems 20.1 14.3 18.3
Trelleborg Sealing Solutions 21.1 16.2 20.4
Trelleborg Engineered Systems 8.1 12.6 8.9
Trelleborg Automotive 9.6 9.0 8.8
Total including items affecting comparability 12.8 11.7 12.6
Cash flow report Capital Sold non Change in Total cash flow
EBITDA 1) expenditure current assets working capital Jan - Mar
SEK M 2012 2011 2012 2011 2012 2011 2012 2011 2012 2011
Trelleborg Wheel Systems 184 118 -32 -16 0 0 -277 -255 -125 -153
Trelleborg Sealing Solutions 488 402 -35 -22 3 2 -192 -180 264 202
Trelleborg Engineered Systems 264 299 -89 -40 1 3 -324 -314 -148 -52
Trelleborg Automotive 140 119 -48 -72 29 0 -190 -224 -69 -177
Other companies -1 6 -1 -5 - 0 -50 1 -52 2
Group items -87 -74 -14 -6 - - 38 76 -63 -4
Operating cash flow 988 870 -219 -161 33 5 -995 -896 -193 -182
Utilization of restructuring provisions -51 -37
Dividend - non-controlling interest 0 -
Financial items -102 -205
Paid tax -108 -104
Free cash flow -454 -528
Acquisitions - -329
Disposals 112 427
Sum net cash flow -342 -430

1) Excluding other non cash-flow affecting items

Acquisitions

There were no acquisitions during the quarter.

Key ratios per quarter

Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
SEK M 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations
Net sales 7,773 7,106 7,191 7,583 7,226 6,852 6,601 7,187 6,556
Operating profit 744 459 621 706 645 400 505 643 488
Profit for the period 501 266 420 469 423 234 327 415 308
Operating cash flow -193 726 644 467 -182 929 391 792 78
Items aff. comparability in operating profit -28 -70 -80 -45 -9 -118 -54 -51 -27
Operating profit, excl. items aff. comp. 772 529 701 751 654 518 559 694 515
EBITDA, %, excl. items aff. comparability 12.8 10.6 13.0 12.8 12.1 11.0 12.3 13.2 11.7

Net sales by business area

Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
SEK M 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations
Trelleborg Wheel Systems 1,128 954 953 1,006 950 738 732 795 725
Trelleborg Sealing Solutions 1,973 1,706 1,864 1,905 1,813 1,574 1,630 1,713 1,520
Trelleborg Engineered Systems 2,818 2,610 2,537 2,803 2,607 2,806 2,555 2,842 2,639
Trelleborg Automotive 1,890 1,794 1,779 1,827 1,712 1,618 1,584 1,715 1,579
Other companies 95 141 178 166 264 234 203 243 248
Eliminations -131 -99 -120 -124 -120 -118 -103 -121 -155
Total 7,773 7,106 7,191 7,583 7,226 6,852 6,601 7,187 6,556

EBITDA % by business area

Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
% 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 15.9 12.8 12.9 13.1 12.1 10.4 13.8 10.3 13.8
Trelleborg Sealing Solutions 24.4 21.0 25.4 24.6 21.9 17.7 19.5 20.3 17.1
Trelleborg Engineered Systems 9.0 6.4 11.0 11.7 11.1 11.5 12.9 13.5 10.4
Trelleborg Automotive 7.5 10.3 7.1 5.8 6.9 10.7 8.8 10.6 10.6
Total 12.8 10.6 13.0 12.8 12.1 11.0 12.3 13.2 11.7

Operating profit by business area

Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
SEK M 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations excluding items
affecting comparability
Trelleborg Wheel Systems 156 99 98 108 96 51 77 59 76
Trelleborg Sealing Solutions 429 301 422 420 352 234 262 297 209
Trelleborg Engineered Systems 164 83 193 247 203 234 240 287 180
Trelleborg Automotive 90 132 66 51 61 102 64 109 92
Other companies -3 -12 -7 -6 -8 -18 -18 -4 -15
Group items -64 -74 -71 -69 -50 -85 -66 -54 -27
Total 772 529 701 751 654 518 559 694 515
Income Statements
Group Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
SEK M 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations
Net sales 7,773 7,106 7,191 7,583 7,226 6,852 6,601 7,187 6,556
Cost of goods sold -5,684 -5,358 -5,239 -5,561 -5,325 -5,045 -4,848 -5,195 -4,809
Gross profit 2,089 1,748 1,952 2,022 1,901 1,807 1,753 1,992 1,747
Selling expenses -558 -558 -547 -552 -543 -548 -511 -542 -523
Administrative expenses -649 -706 -638 -649 -597 -698 -576 -626 -590
Research and development costs -152 -149 -141 -138 -146 -143 -140 -149 -145
Other operating income/costs 10 121 -8 21 27 -22 -24 -36 -4
Profit from part. in assoc. companies 4 3 3 2 3 4 3 4 3
Operating profit 744 459 621 706 645 400 505 643 488
Financial income and expenses -55 -63 -54 -49 -43 -43 -56 -50 -69
Profit before tax 689 396 567 657 602 357 449 593 419
Tax -188 -130 -147 -188 -179 -123 -122 -178 -111
Net profit 501 266 420 469 423 234 327 415 308
Discontinued operations
Net sales - - - - 44 193 264 627 498
Operating profit - - - -2 260 23 40 -160 13
Profit before tax - - - -2 260 23 38 -159 12
Net profit - - - -2 262 28 28 -141 -16
Group, total
Net sales 7,773 7,106 7,191 7,583 7,270 7,045 6,865 7,814 7,054
Operating profit 744 459 621 704 905 423 545 483 501
Profit before tax 689 396 567 655 862 380 487 434 431
Total net profit 501 266 420 467 685 262 355 274 292
- equity holders of the parent 494 262 413 465 679 257 351 269 285
- non-controlling interest 7 4 7 2 6 5 4 5 7
Earnings per share Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
SEK 2012 2011 2011 2011 2011 2010 2010 2010 2010
Continuing operations 1.80 0.95 1.55 1.70 1.55 0.85 1.20 1.50 1.10
Discontinued operations 0.00 0.00 0.00 0.00 0.95 0.10 0.10 -0.50 -0.05
Group, total 1.80 0.95 1.55 1.70 2.50 0.95 1.30 1.00 1.05

Parent Company

Income Statements

Parent company Jan - Mar Jan - Mar Apr 2011 - Full year
SEK M 2012 2011 Mar 2012 2011
Administrative expenses -59 -66 -348 -355
Other operating income 1 9 221 229
Operating profit -58 -57 -127 -126
Financial income and expenses -249 129 1,086 1,464
Profit before tax -307 72 959 1,338
Tax 76 53 27 4
Net profit -231 125 986 1,342
Statements of comprehensive income
Net profit -231 125 986 1,342
Other comprehensive income
Fair value - -9 9 -
Income tax relating to components of other
comprehensive income
- 2 -2 -
Other comprehensive income, net of tax - -7 7 -
Total comprehensive income -231 118 993 1,342
Balance Sheets
Parent company Mar 31 Mar 31 Dec 31
SEK M 2012 2011 2011
Property, plant and equipment 22 25 23
Intangible assets 4 8 4
Financial assets 34,846 34,523 34,732
Total non-current assets 34,872 34,556 34,759
Current operating receivables 64 67 53
Current tax assets 75 55 -
Current interest-bearing receivables 224 844 597
Cash and cash equivalents 0 0 0
Total current assets 363 966 650
Total assets 35,235 35,522 35,409
Shareholders' equity 13,256 12,727 13,477
Total equity 13,256 12,727 13,477
Non-current interest-bearing liabilities 29 51 29
Other non-current liabilities 19 17 16
Total non-current liabilities 48 68 45
Interest-bearing current liabilities 21,860 22,651 21,789
Other current liabilities 71 76 98
Total current liabilities 21,931 22,727 21,887
Total equity and liabilities 35,235 35,522 35,409

Financial definitions

Return on shareholders' equity, %

Profit for the period, attributable to shareholders of the Parent Company as a percentage of average shareholders' equity, excluding non-controlling interests.

Return on capital employed (ROCE), %

Operating profit divided by the average capital employed.

EBITDA

Operating profit excluding depreciation and amortization of PPE and intangible assets.

EBITDA margin, %

EBITDA excluding profit from participations in associated companies as a percentage of net sales.

Free cash flow

Operating cash flow, cash flow from financial items, taxes and the effect of restructuring measures on cash flow.

Net debt

Interest-bearing liabilities less interest-bearing assets, cash and cash equivalents.

Operating cash flow

EBITDA excluding undistributed participation in the earnings of associated companies, investments, sold non-current assets and changes in working capital but excluding cash flow pertaining to restructuring.

Operating cash flow/operating profit, %

Operating cash flow as a percentage of operating profit.

Earnings per share

Profit for the period, attributable to shareholders of the Parent Company, divided by the average number of shares outstanding.

Operating margin (ROS), %

Operating profit excluding participation in the earnings of associated companies as a percentage of net sales.

Operating profit

Operating profit as stated in the income statement.

Debt/equity ratio, %

Net debt divided by total equity.

Net debt/EBITDA

Net debt divided by EBITDA.

Equity/assets ratio, %

Total equity divided by total assets.

Capital employed

Total assets less interest-bearing financial assets and noninterest-bearing operating liabilities (including pension liabilities) and excluding tax assets and tax liabilities.

Invitation to a telephone conference on April 19 at 2:00 p.m.

A telephone conference will be held on April 19 at 2:00 p.m. To participate in the telephone conference, call +46 (0)8 505 629 32 or +44 (0)20 7750 9950 or +1866 676 58 69. Code: "Trelleborg". The conference will also be broadcast on the Internet in real time. Visit our website at: www.trelleborg.com/en/Investerare/Presentationer for the Internet link and presentation materials.

Calendar

Annual General Meeting (Trelleborg) April 19, 2012, 5:00 p.m. Interim report April-June July 19, 2012 Interim report July-September October 24, 2012 Year-end report February 13, 2013

For further information, please contact:

Investors/analysts Media Christofer Sjögren, VP Investor Relations Karin Larsson, VP Media Relations Phone: +46 (0)410 670 68Phone: +46 (0)410 670 15 Mobile: +46 (0)708 66 51 40 Mobile: +46 (0)733 74 70 15 E-mail: [email protected] E-mail: [email protected]

For information about the Trelleborg Group, Annual Reports, the stakeholder magazine T-TIME and other information, please visit Group's website: www.trelleborg.com.

Trelleborg AB (publ) Corp. Reg. No. 556006-3421 Box 153, SE-231 22 Trelleborg Sweden Tel: +46 (0)410 670 00 www.trelleborg.com

This report contains forward-looking statements that are based on the current expectations of the management of Trelleborg. Although management believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove 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.

This is information of the type that Trelleborg AB (publ) is obligated to disclose in accordance with the Swedish Securities Exchange and Clearing Operations Act and/or the Financial Instruments Trading Act. The information was issued for publication on Thursday, April 19, 2012, at 1:00 p.m.