Interim report January - June 2009

Interim report January - June 2009

SECO TOOLS AB

Interim report for the six months ended 30 June 2009

* Revenue for the quarter fell by 40 per cent at fixed exchange rates and 30 per
cent in Swedish kronor (SEK), and amounted to SEK 1,180 M (1,697). 
* The cost adaptations have been increased and are proceeding more quickly than
planned.
* Due to significantly lower volumes, operating profit for the quarter declined
to SEK 40 M (378). Operating margin for the quarter was 3.4 per cent (22.3).
* Revenue for the six-month period fell by 34 per cent at fixed exchange rates
and amounted to SEK 2,531 M (3,329).
* Profit after tax for the six-month period was SEK 68 M (531).
* Earnings per share for the six-month period were SEK 0.47 (3.65).


Comments from the CEO

“The weak demand situation in virtually all of Seco Tools' markets persisted
throughout the second quarter. Revenue for the quarter was weak compared to the
previous year, but the dramatic drop in demand appears to have passed and sales
levelled off at a low level during the quarter. 

On the whole, however, Seco Tools' development relative to the market average
remains positive. A major product launch in the important area of square
shoulder milling was carried out during the quarter with the new Square 6
family, which offers highly attractive cutting economy for our customers.

The cost adaptations have been increased and the implementation is proceeding
more quickly than the plan we presented after the first quarter. All in all, the
ongoing actvities are expected to reduce Seco Tools' annual cost level by nearly
SEK 600 M, whereof SEK 500 M will impact this years' result. The cost-cutting
programmes include a reduction in our global workforce by around 900 positions
including temporary employees.

Operating margin for the second quarter was 3.4 per cent (22.3) including
additional one-time costs of SEK 24 M for the cost adaptations. The decrease
compared to the previous year is mainly attributable to the drop in both sales
and production volumes. The period's lower earnings have been somewhat offset by
the effects of the cost-cutting programmes and positive foreign exchange
effects.

The present weak demand situation is being further aggravated by inventory
reduction among our end-customers and distributors, a trend that is expected to
continue until after the vacation period. On the whole, we are currently seeing
no signs of a near-term improvement in the demand scenario” says Kai Wärn,
President and CEO of Seco Tools.

For additional information contact Kai Wärn, President and CEO, (Tel: +46
223-401 10) or Patrik Johnson, CFO, (+46 223-401 20). E-mail can be sent to
investor.relations@secotools.com

Previously published financial information can be found under “About
Seco/Investor Relations” on the Seco Tools website (www.secotools.com). Seco
Tools AB's corporate registration number is 556071-1060 and the company's
address is Seco Tools AB, SE-737 82 Fagersta, Sweden. The telephone number to
the Group head office is +46 223-400 00.