Alfa Laval AB, Sweden

Alfa Laval AB, Sweden

COMPANY PROFILE Alfa Laval AB, Sweden Profile Alfa Laval provides equipment, systems and services for process optimisation based around three key te...

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Alfa Laval AB, Sweden Profile

Alfa Laval provides equipment, systems and services for process optimisation based around three key technologies – centrifugal separation, heat transfer and fluid handling. Its product range includes high-speed centrifuges, decanters and filters, as well as desalination plants and heat exchangers. It has two main divisions, Equipment and Process Technology, and operates in more than 100 countries. Analysis

Alfa Laval continued to enjoy strong growth in fiscal 2007, with new orders and net sales both increasing in excess of 14% on the previous year. Order intake totalled SKr27 553 million for the 12 months, representing a 14.7% increase on the previous year. Excluding exchange rate variations the improvement was even stronger at 18.3%, while further adjusting for acquisitions and divestments made the comparative figure an increase of 16.9%. Net sales for the year amounted to SKr24 849 million, up 25.5% on the 2006 figure. Excluding exchange rate variations, the invoicing was 29.1% higher than the year earlier, while further adjustments for acquisitions and divestments of businesses, brought the year-on-year increase to 25.8%. Alfa Laval acquired four companies during the year (DSO, Helpman, AGC Engineering and Fincoil), while it divested its biopharm engineering activity at the very end of fiscal 2006. The company’s Equipment division saw new orders for 2007 increase 26.0% on the 2006 figure to reach SKr15 896 million, with the growth figure reaching 30.1% when adjusted for currency changes and 26.7% when acquisitions and divestments are also considered. Net sales for the division were up 24.3% at SKr13 586 million, with the growth reaching 27.8% when currency adjusted. All segments within the Equipment division, except OEM, showed good growth. In the Process Technology division new orders for fiscal 2007 were up 1.8% on the year earlier at SKr11 594 million, with the growth figure reaching 4.9% when currency adjusted. Net sales for the Process Technology division were 27.3% stronger than a year earlier at SKr11 242 million, with the increase reaching 31.2% currency adjusted. Business was strong in all segments in the division, especially for parts and servicing, with the inorganic segment leading the way. Alfa Laval’s operating income increased 83.8% on the year earlier to reach SKr4691 million, while net income posted a similar gain to total SKr3180 million compared with SKr1725 million a year earlier. Key Figures (SKr million) Alfa Laval AB 2007

COMMENT Moving forward, Alfa Laval continues to place a heavy emphasis on new products. In 2007, the company set a goal of increasing the percentage of sales from new products by 50%, while also reducing the time from concept to market introduction by 25%. To help meet these goals, the company has increased its investment in R&D by 50% in the past three years, while it believes it has also improved its organizational structure to facilitate product development. The largest investments were made in energy and energy related application areas, a segment that now accounts for 40% of Alfa Laval’s order intake. The company believes that high energy prices, environmental challenges and changes in the global energy policy map herald many opportunities in areas such as oil and gas extraction, liquefied natural gas, refineries and petrochemicals. Acquisitions are also continuing to strengthen Alfa Laval’s market positions and its growth. In 2007, Alfa Laval bought four companies that added 4% to its overall revenues, which has been the average contribution from new acquisitions for the past three years. One of the aims of its acquisition programme is to increase its global presence, which at present has a strong focus on the ‘BRIC’ countries of Brazil, Russia, India and China. These four large and rapidly growing economies accounted for a combined 23% of the company’s total order intake in 2007, compared with 13% in 2002. Indeed, China is already Alfa Laval’s second largest market after the USA. ■

Year ended 31.12 2006 2005



Net Sales Of Which: Equipment Process Technology

24 849

19 802

16 330

14 986

13 909

13 586 11 242

10 934 8829

8631 7673

n/a n/a

n/a n/a

Cost of Goods Sold

15 340

12 598

10 800


















Gross Profit R&D Expenses Operating Income Net Income Order Intake






27 553

24 018

18 516

15 740

14 145

Contact Details

Chair: CEO: Address:


Filtration Industry Analyst

Anders Narvinger Lars Renström Box 73 SE-221 00 Lund Sweden

Tel: +46 46 36 65 00 Fax: +46 46 36 71 87 Web:

July 2008