Engineering group Sandvik rides strong demand as profit tops forecast
STOCKHOLM – Swedish engineering group Sandvik posted better than expected fourth-quarter core profit on Monday and said demand had been strong across all of its business areas.
The Swedish maker of metal-cutting tools, mining equipment and speciality steels has been riding booming demand for mining gear as well as a sharp rise in general industrial demand throughout most of 2017.
Rivals Atlas Copco and Kennametal had also reported strong demand growth in recent weeks.
Sandvik said that fourth-quarter operating profit excluding one-offs rose to 4.07-billion Swedish crowns ($514.92-million). That compared with 3.28-billion crowns a year ago and an average forecast of 3.72-billion crowns in a Reuters poll of analysts.
The operating profit beat market forecasts in all Sandvik's business areas, including the speciality steels unit Materials Technology.
"I am very pleased with our diligent focus on cost efficiency in this period of high business activity," CEO Bjorn Rosengren said in a statement.
"I am particularly pleased with the performance of Sandvik Machining Solutions and Sandvik Mining and Rock Technology.
Order intake at the group rose 15% to 24.1-billion crowns, compared with analyst expectations of 23.2-billion crowns.
Sandvik shares are up by about 25% in the past year, roughly in line with Atlas Copco and double the gain made by the European industrial sector index.
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