april 26, 2007, atlas copco group q1 results april 26, 2007

1April 26, 2007, www.atlascopco.com

Atlas Copco Group

Q1 Results

April 26, 2007


Contents

Q1 Business Highlights

Market Development

Business Areas

Financials

Outlook


Q1 - Highlights

Accelerated growth– Organic order growth 24%

– Strong performance both in equipment and aftermarket

– 20th consecutive quarter of organic growth

Strengthened market position– Investments in market organization

– Investments in manufacturing capacity and efficiency

– Strategic acquisitions


Q1 - Figures in summary

Revenues up 12% to MSEK 13 390– 17% organic growth

Operating profit up 21% to MSEK 2 541– Record operating margin of 19.0% (17.5)

Profit before tax at MSEK 2 477 (2 032)– Profit margin of 18.5% (17.0)

Profit from continuing operations up 21% to MSEK 1 773– Earnings per share continuing operations SEK 2.89

Operating cash flow, continuing operations, MSEK 845 (711)


Contents


Market Development

Business Areas

Financials

Outlook


Orders received - Local currencyGroup total +27% YTD(Structural change +3% YTD)

March 2007A = Portion of sales, last 12 months, %

B = Year-to-date vs. prev. year, %

39 +25

10 +57

5 +39

18 +2821 +18

7 +59

A B


Q1 - The Americas

Continued growth in North America– Favorable investment activity in most

manufacturing and process industries

– Solid demand for mining and construction equipment

Improved demand from all customer segments in South America– Strong sales increases, particularly in

Brazil and Chile7 +59

21 +18


B = Year-to-date vs. prev. year, %A B


Q1 - Europe and Africa/Middle East

Robust demand fuelled growth in Europe– Continued strong demand from manufacturing and

process industries, except from the motor vehicle industry

– Very strong demand from the construction and mining industries

– Strong growth, primarily in Eastern Europe, Great Britain and the Nordic countries

Very positive in Africa / Middle East region– Sales of mining equipment to Southern Africa

increased significantly



39 +25

10 +57


Q1 - Asia and Australia

Sustained growth in Asia– Very good demand for industrial

equipment in all major markets

– Strong development for construction and mining equipment

Strong demand from mining, manufacturing and construction in Australia



5 +39

18 +28


Volume Growth per Quarter

Change in orders received in % vs. same Quarter previous year

Atlas Copco Group, continuing operations

-10

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100

Q2

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300

Q4

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101

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301

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102

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302

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103

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303

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104

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304

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105

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305

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106

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306

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107

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307

Q4


Atlas Copco Group – Sales Bridge

Orders RevenuesMSEK Received2006 13 699 11 948Structural change, % +3 +3Currency, % -9 -8Price, % +3 +2Volume, % +21 +15Total, % +18 +122007 16 120 13 390

January - March


Contents


Market Development

Business Areas

Financials

Outlook


Atlas Copco GroupOperating Profit and Return On Capital Employed (ROCE) by Business Area

Revenues Operating Operating ROCEMSEK profit margin12 month values, period ending Mar. 2007 Mar. 2007 Mar. 2007 Mar. 2007Compressor Technique 26 493 5 568 21.0% 69%Construction and Mining Technique 19 439 3 219 16.6% 37%Industrial Technique 6 355 1 373 21.6% 61%Eliminations/Common Group Functions -333 -512Atlas Copco Group 51 954 9 648 18.6% 34%**including discontinued operations


Compressor Technique

Strong growth continued– Increased market presence and penetration

support equipment and aftermarket growth

– Organic order growth 19%

– Strong in all regions

Operating margin at 21.2%

Strategic acquisitions– Acquisition of Greenfield strengthens presence

in growing CNG segment

– ABAC acquisition finalized on April 2


Compressor Technique

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Revenue volume growth: Change vs. same quarter previous year, %

Quarterly operating margin, %

Quarterly operating margins include Prime Energy from Q1 2006.


Very strong demand from mining, both for equipment and aftermarket

Organic order growth 33%– 20th consecutive quarter

with volume growth

Operating profit up 30% – Record margin at 17.9%

Acquisition of Dynapac

Construction and Mining Technique


Dynapac

A leading supplier of compaction and paving equipment – Sales in over 115 countries, 8 production facilities in 6 countries.

– 2 100 employees with expertise in R&D, production, marketing, sales, services and customer finance

– Revenues approx. MEUR 505, operating margin 11.3% in 2006

– Founded in 1934, headquartered in Sweden

– Purchase price approximately MEUR 700

– Acquisition expected to close in Q2

Expanding presence in the road development market


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Construction and Mining Technique


Industrial Technique

Resumed growth – 7% organic order growth– Increased sales and marketing activities resulted in strong

growth within general industry

– Relatively weak demand from the motor vehicle industry in North America and Western Europe

– Healthy growth for the vehicle service business

All-time high operating profit and margin

New techno center opened

Strategic acquisition of Rodcraft


Industrial Technique

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Contents


Market Development

Business Areas

Financials

Outlook


Group Total

MSEK 2007 2006 %Orders received 16 120 13 699 +18

Revenues 13 390 11 948 +12

Operating profit 2 541 2 096 +21

- as a percentage of revenues 19.0 17.5

Profit before tax 2 477 2 032 +22

- as a percentage of revenues 18.5 17.0

Profit from continuing operations 1 773 1 463 +21

Profit from discontinued operations, net of tax 53 323

Profit for the period 1 826 1 786

January - March


Balance Sheet

MSEK March 31, 2007 Dec 31, 2006 March 31, 2006

Intangible assets 4 722 9% 4 299 8% 3 562 6%

Rental equipment 2 010 4% 1 979 4% 1 991 3%

Other property, plant and equipment 4 000 7% 3 777 7% 3 571 6%

Other fixed assets 3 554 7% 3 161 6% 1 698 3%

Inventories 9 783 18% 8 487 15% 7 913 14%

Receivables 13 523 25% 12 401 22% 12 178 21%

Current financial assets 944 2% 1 016 2% 577 1%

Cash and cash equivalents 16 139 30% 20 135 36% 3 858 7%

Assets classified as held for sale 21 937 38%

TOTAL ASSETS 54 675 55 255 57 285

Total equity 35 730 65% 32 708 59% 27 355 48%

Interest-bearing liabilities 4 564 8% 8 787 16% 10 149 18%

Non-interest-bearing liabilities 14 381 26% 13 760 25% 13 392 23%

Liabilities associated with assets classified as held for sale 6 389 11%

TOTAL EQUITY AND LIABILITIES 54 675 55 255 57 285


Cash Flow

MSEK 2007 2006*

Operating cash surplus after tax 2 018 1 916 of which depreciation added back 414 389Change in working capital -506 -529 Cash flows from operating activities 1 512 1 387Investments in tangible fixed assets -528 -498Sale of tangible fixed assets 172 145Other investments, net -311 -323Cash flow from investments -667 -676 Operating cash flow 845 711Company acquisitions/ divestments -219 -268

*Restated, continuing operations

January - March

Continuing operations


Contents


Market Development

Business Areas

Financials

Outlook


Near-term Outlook

The demand for Atlas Copco’s products and services, from most customer segments such as mining, construction, and the manufacturing and process industries, is expected to remain at the current high level.


Cautionary Statement

“Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially effected by other factors like for example, the effect of economic conditions, exchange-rate and interest-rate movements, political risks, impact of competing products and their pricing, product development, commercialization and technological difficulties, supply disturbances, and major customer credit losses.”

april 26, 2007, atlas copco group q1 results april 26, 2007

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