Strong growth reported by Sandvik in fourth quarter of 2010
"The business climate continued its positive trend in the fourth quarter and order intake and invoiced sales rose for all business areas compared with the preceding quarter.
Order intake for major project orders rose sharply during the quarter and totaled more than SEK 3.5 billion, most of which related to material-handling systems. Although the increase in demand was stable in most markets, it was strongest in the mining and energy sectors. Order intake amounted to more than SEK 26 billion, which is the highest figure to date for a single quarter. Invoiced sales totaled slightly more than SEK 23 billion, which was 31% higher in price and volume than the preceding year. The operating margin and operating result amounted to 13.4% and SEK 3.1 billion, respectively. As a result of the continued
improvement in capital efficiency combined with higher operating margins, return on capital employed improved further and also generated a strong cash flow. Working capital was for the first time better than the target level of 25% of invoiced sales," says Sandvik's resigning President and CEO Lars Pettersson.
"The market trend remained positive in the quarter and we continued to improve our financial key figures. We also reached an agreement involving a strategically important acquisition through which Sandvik will acquire 80% of the Chinese company Shanghai Jianshe Luqiao Machinery Co., Ltd. The acquisition will strengthen Sandvik's position in China and create favorable conditions for continued profitable growth."
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