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20 October 2009

The SKF Group

Nine-month results 2009

Tom Johnstone, President and CEO

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20 October 2009

Key points from Q3 report

• Strong cash flowQ3: SEK 1,359 m YTD September: SEK 4,307 m

• Dramatic volume drop year over year. Trend indicates

levelling off.Q3: -24.9% YTD September: -27.6%

• Continued strong price/mixQ3: 3.7% YTD September: 5.5%

• Cost reduction efforts in focus and giving results- annualised savings from all programmes, around SEK 800 million- significant short-time working being utilized. Now 14,000 people.

• Demand outlook for Q4 - year over year: significantly lower- sequentially: slightly higher

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20 October 2009

Highlights Q3 2009

SKF

• inaugurated its additional investment in the factory for large size bearings in Dalian, China, which doubles the manufacturing capacity.

• signed a Memorandum of Understanding with Sinovel Wind Co. Ltd for strategic partnership, and a series of contracts with a value exceeding SEK 330 m for main shaft bearings and sealing systems for 3MW wind turbines.

• signed a service contract with Transocean. The contract is worth SEK 10 m and covers asset reliability services for 59 of Transocean's drilling rigs.

• was selected as the sector leader for the IEQ Industrial Engineering sector in the 2009 Dow Jones Sustainability Indexes (DJSI). SKF was also included in the FTSE4Good Index Series, for the ninth year in succession.

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20 October 2009

Highlights Q3 2009

SKF launched 11 new solutions to help customers increase equipment reliability, reduce maintenance costs and environmental impact:

Wind turbine blade bearing

grease

Telescopic pillar system

Sealed spherical roller bearings

Super precision bearings

Y-bearings

Machine condition advisor

Profile rail guides

Actuators

Large diameter sealing solutions

Oil conditioning unit

Sealing solutions for screw

compressors

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20 October 2009

SEKm 2009 2008

Net sales 13,324 15,381

Operating profit 957* 2,085

Operating margin 7.2% 13.6%

Operating margin excl. restructuring, %

8.7% 13.6%

Profit before taxes 689 1,859

Net profit 483 1,257

Basic earnings per share, SEK 1.01 2.67

Cash flow after investments before financial items 1,359 -526

Third quarter 2009

* Q3 restructuring around SEK 200 mOperating profit excl. restructuring activities SEK 1,157

m

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20 October 2009

SEKm 2009 2008

Net sales 42,340 47,054

Operating profit 2,199* 6,260

Operating margin 5.2% 13.3%

Operating margin excl. restructuring, %

7.3% 13.3%

Profit before taxes 1,532 5,761

Net profit 1,200 3,922

Basic earnings per share, SEK 2.56 8.39

Cash flow after investments before financial items 4,307 215

First nine months 2009

* YTD September restructuring around SEK 875 mOperating profit excl. restructuring activities SEK 3,074

m

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20 October 2009

-25

-20

-15

-10

-5

0

5

10

15

2007 2008 YTD September2009

Growth in local currency(Organic growth + Acquisition/Divestments)

% y-o-y

Acquisitions/Divestments

Organic growth

13.2%

Long-term target level: 6-8% per annum

7.1%-20.8%

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20 October 2009

Sales in local currencies (excl. structural changes)

-30

-25

-20

-15

-10

-5

0

5

10

15% change y-o-y

2007 2008 2009

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20 October 2009

Sales volume

-35

-30

-25

-20

-15

-10

-5

0

5

10% change y-o-y

2007 2008 2009

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20 October 2009

Components in net sales

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

7.9 6.9 9.0 6.3 4.9 6.2 2.7 -13.0 -26.9

-30.8 -24.9

4.0 4.6 3.7 1.0 1.0 1.3 0.5 2.4 1.4 1.1 1.2

1.8 2.7 2.0 3.2 3.8 4.0 6.4 8.5 7.1 5.6 3.7

13.7 14.2 14.7 10.5 9.7 11.5 9.6 -2.1 -18.4 -24.1 -20.0

-5.6 -2.3 -1.9 -2.0 -1.2 -4.1 -0.9 10.3 13.6 12.2 6.6

8.1 11.9 12.8 8.5 8.5 7.4 8.7 8.2 -4.8 -11.9 -13.4

Percent y-o-y

Volume

Structure

Price / Mix

Sales in local currencyCurrency

Net sales

2007 2008 2009

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20 October 2009

Operating margin

0

2

4

6

8

10

12

14

2007 2008 YTD September2009

%

12.9 12.2

Long-term target level: 12%

5.2

13.3* 12.7*

7.3*

Restructuring and one-time items* Excluding restructuring and one-time

items

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20 October 2009

Operating margin

%

0

2

4

6

8

10

12

14

16

2007

Long-term target level: 12%

2008 2009

Restructuring and one-time items

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20 October 2009

-12-10-8-6-4-202468

1012141618

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Operating margin per division

Industrial

Service

Automotive

%

2007 2008

Excluding one-off items (eg. restructuring, impairments, capital gains)

2009

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20 October 2009

Activities to adapt to lower demand

• Restructuring/impairment activities People Costs charged to

operating profit

Q4 2008 2,500 SEK 340 m Q1 2009 500 SEK 175 m

Q2 2009 900 SEK 500 mQ3 2009 70 SEK 200 m

3,970 SEK 1,215 m

At the end of September 2009, around 4,400 people have left the Group since the third quarter last year, of which around 2,500 people under the programmes.

Total savings from these activities around SEK 800 m.

• In addition, around 14,000 people in short-time working end of September 2009.

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20 October 2009

18

19

20

21

22

23

24

25

Inventories as % of annual sales

%

2007

Long-term target level: 18%

2008 2009

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20 October 2009

Return on capital employed

0

5

10

15

20

25

30

2007 2008 YTD September2009

ROCE: Operating profit plus interest income, as a percentage of twelve months average of total assets less the average of non-interest bearing liabilities.

%

Long-term target level: 24%

24.9 24.0

10.2

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20 October 2009

Net debt (Short-term financial assets minus loans and post-employment benefits)

-18 000

-16 000

-14 000

-12 000

-10 000

-8 000

-6 000

-4 000

-2 000

0

SEKm

AB SKF, dividend paid (SEKm):2007 Q2 2,0492008 Q2 2,2772009 Q2 1,594

Redemption (SEKm):

2007 Q2 4,5542008 Q2 2,277

2007 2008 2009

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20 October 2009

AB SKF, debt structure

Amount in million Maturity

Euro Bond EUR 132* 2010-06

SEK Bond SEK 1,500 2011-06

Term loan in euro EUR 150 2013-06

Euro Bond EUR 500 2013-12

Euro loans EUR 130 2014-03

Euro loan EUR 100 2016-06

* Was EUR 250 million, reduced by EUR 118 million in Q2.

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20 October 2009

Cash flow, after investments before financial items

-1 000

-500

0

500

1 000

1 500

2 000

2 500

2007

SEKm

Cash out fromacquisitions* (SEKm):

2007 1,2092008 1,2842009 239

2008 2009

* including non-controlling interests.

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20 October 2009

October 2009: Outlook for the fourth quarter 2009

Sales development compared to fourth quarter last yearThe demand for SKF products and services is expected to be significantly lower for the Group in total and in Europe and North America. In Asia it is expected to be unchanged and in Latin America slightly higher. It is expected to be unchanged for the Automotive Division but significantly lower for the Industrial Division and Service Division.

Sales development compared to the third quarter this yearThe demand is expected to be slightly higher for the SKF Group in total. It is expected to be relatively unchanged in Europe and North America and slightly higher in Asia and Latin America. It is expected to be relatively unchanged for the Automotive Division and slightly higher for both the Service Division and the Industrial Division.

Manufacturing levelThe manufacturing level will be significantly lower year on year and slightly higher compared to the third quarter.

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20 October 2009

Volume trends(based on current assumptions)

Daily volume trends for: Q3 2009 Q4 2009

Net sales2008

Europe

56%

North America

17%

Asia Pacific19%

Latin America

5%

Total

Outlook Q42009 vs

2008

---

---

=

+

---

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20 October 2009

5% Aerospace

13%

12%

9%

6%

Cars

Industrial OEM, Heavy+Off-

highway

Vehicle Service Market

Energy

5% Trucks

23%

20%

3%

3%

Industrial distribution

Industrial OEM,

General+Special

Railway

Electrical and two-wheeler

Sequential volume trend main segments Q4 2009(based on current assumptions)

Net sales 2008

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20 October 2009

Guidance for the fourth quarter 2009

• Tax level: around 30%

• Financial net for the fourth quarter:Around SEK -200 million

• Exchange rates on operating profit versus 2008Q4: +0

Full year: SEK 750 million

• Additions to PPE: Around SEK 2 billion for 2009

Guidance is approximate and based on current assumptions and exchange rates.

-

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20 October 2009

Key focus areas ahead 2009

• Profit and cash flow- maintain positive price/mix- drive operational efficiency and cost reduction- reduce working capital and investments

• Adjustment of manufacturing output to new demand levels- restructuring- short-time working

• Growing segments and geographies

• Strengthening the platform/segment approach

• Competence development

SKF Care and Six Sigma as guiding lights

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20 October 2009

SKF Care

Employee Care

Community CareEnvironmental Care

Business Care

BeyondZeroT

M

0

2

4

6

8

10

12

14

2003 2004 2005 2006 2007 2008

SKF Care

Operating margin

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20 October 2009

SKF Group Vision

To equip the worldwith SKF

knowledge

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20 October 2009

Cautionary statement

This presentation contains forward-looking statements that are based on the current expectations of the management of SKF.

Although management believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been 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 mentioned in SKF's latest annual report (available on www.skf.com) under the Administration Report; "Most important factors influencing the financial results", "Financial risks" and "Sensitivity analysis”.

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20 October 2009