The SKF GroupHalf-year result, 2005

Tom Johnstone, President and CEO

MSEK 2005 2004

Net sales 12 739 11 417

Operating profit 1 383 1 159

Operating margin 10.9% 10.2%

Profit before taxes 1 319 1 049

Net profit 905 733

Earning per share, SEK 1.95 1.49

Cash flow after investments before

financing* 262 559

Second quarter 2005

* MSEK 718, before the acquisition of Jaeger Industrial Ltd. and the purchase of minority shareholding in previously acquired companies.

MSEK 2005 2004

Net sales 24 610 22 106

Operating profit 2 571 2 062

Operating margin 10.4% 9.3%

Profit before taxes 2 443 1 864

Net profit 1 684 1 402

Earning per share, SEK 3.60 2.80

Cash flow after investments before

financing

406 1 094

Half-year 2005

Areas in focus 2005 Performance Q2 2005

• Operating margin level

Maintain a positive price/mix

Recovery of raw material cost increase

• Continued sales growth

Maintain organic growth pace

Structure

• Strengthen the platform/segment offer

• Cash flow before financingand acquisitions

In line with net profit, annual basis

3.6%

Ongoing

11.2%

0.2%

Ongoing

MSEK 718

Major events during the quarter

• Merger of long-steel operations, Oy Ovako Ab

• Share split and redemption

• Launch of a 350 million euro dual-tranche bond

• Acquisition of Jaeger Industrial Ltd.

• Announcement of the closure of two plants in the USA

Operating margin*

%

2002 2003 2004

0

1

2

3

4

5

6

7

8

9

10

11

* excluding restructuring and impairment in Q4 2003

2005

0

2

4

6

8

10

12

14

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Operating margin per division*

Industrial

Service

Aero and Steel excl. Ovako

Electrical

Automotive

%

2003 2004

* excl. restructuring and impairment in Q4, 2003 and in Q2, 2005

2005

Sales in local currency

-6-4-2024681012141618

% change y-o-y

2002 2003 2004 2005

Growth development / local currency10 BSEK additional sales = 6 % annual growth rate

% Y-o-Y

0246810121416

2002 2003 2004 2005

Growth by acquisitions

Organic growth

6% total growth

4% organic growth

Up to June

Net sales development per quarter

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

6.2 3.2 4.2 3.1 4.8 8.9 9.6 10.2 8.3 7.6

0.7 0.1 0.2 0.3 0.1 0.0 2.2 2.0 2.3 0.2

1.2 0.6 1.2 0.1 1.1 1.8 2.3 4.2 3.6 3.6

8.1 3.9 5.6 3.5

6.0 10.7 14.1 16.4 14.2 11.4

-9.3 -8.6 -5.5 -7.4

-4.6 -2.3 -2.9 -3.8 -3.2 0.2

-1.2 -4.7 0.1 -3.9

1.4 8.4 11.2 12.6 11.0 11.6

Percent y-o-y

2003 2004

Volume

Structure

Price / Mix

Sales in local currency Currency

Net sales

2005

Inventories as % of annual sales

%

2002 2003 2004

18

19

20

21

22

23

24

25

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2005

Cash flow, after investments before financing

-200

0

200

400

600

800

1 000

1 200

1 400MSEK

2002 2003 2004 2005

Net debt

-1500

-500

500

1500

2500

3500

4500

5500

MSEK

2001 2002 2003

Dividend paid:

2001 Q2, MSEK 598

2002 Q2, MSEK 683

2003 Q2, MSEK 911

2004 Q2, MSEK 1 138

2005 Q2, MSEK 1 366

2004 Q2, Pension: MSEK 3 100

2005 Q2, Redemption, MSEK 2 846

2004

(Short-term financial assets - loans)

2005

Net interest bearing liabilities

-6000

-5000

-4000

-3000

-2000

-1000

0

1000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

MSEK

(Short-term financial assets - loans - net postemployment benefits)

2003 2004 2005

Share split and distribution to shareholders

Number of shares as per June 30, 2005

SKF A 63 876 892SKF B 391 474 176Total 455 351 068

MSEK 1 366Dividend

MSEK 2 846Redemption

MSEK 4 212Distributed to shareholders

SKF issued during the second quarter: A 350 million euro dual-tranche bond - a 100 million euro three-year floating-rate bond - a 250 million euro five-year fixed rate bond

Jaeger Industrial Co Ltd.

• Leading supplier in Asia-Pacific

• Complete range of actuation systems

• Low cost manufacturing and high volume capabilities

• Own sales units plus sales through specialized dealers

• Manufacturing plants both in Taiwan and China

• Turnover year 2004,MSEK 320

• 750 employees

• ~50% sales volume in Asia

• Founded 1982

• Five business units (Taiwan, China & USA)

• ISO 9001

Jaeger market segments

• Satellite disc positioning

• Gate openers

• General industry

• Health care & Ergonomics

-8000

-6000

-4000

-2000

0

2000

4000

6000

2000 2001

Accumulated change in the number of employees

2002

acquisitions

capacity adjustmentand restructuring

Employees

2003 2004 2005

Fixed assets / Sales

20

22

24

26

28

30

32

34

36

38

40

98 99 00 01 02 03 04 05

%%

Up to June

SKF Group targets

• 10% Operating margin level

• 6% Growth per annum

• 20% ROCE

• 18% Inventory / sales

2006

2007

July 2005: Outlook for the third quarter

The market demand for SKF’s products and services in the third quarter, compared to the previous quarter, is expected to remain on a high level in Europe, to be slightly higher in North America, higher in Latin America and significantly higher in Asia. However, the third quarter is seasonally lower than the second quarter.

The manufacturing level will be unchanged during the third quarter, compared to the second quarter, while lower in absolute terms due to normal seasonality.

Volume trend for the third quarter 2005

Europe 57%

20%

15%

5%

North America

Asia Pacific

Latin America

Net sales 2004 July 2005

Total

April 2005

Note: This is the sequentialdevelopment

Cautionary statement

This report 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 20-F report on file with the SEC (United States Securities and Exchange Commission) under "Forward-Looking Statements" and "Risk Factors".