Alfa Laval net income slips but food and beverage escapes unscathed

Alfa Lavel said the drop in net income was due to a negative mix effect, lower utilisation in certain factories and integration costs associated with the acquisition of Aalborg Industries.

The Swedish company reported that net sales for Q2 totalled SEK 7.81bn, compared with SEK 7.03bn last year and order intake was SEK 7.9bn, up 6% compared to the corresponding quarter in 2011. 

The sanitary section of the equipment division showed continued growth compared to the previous quarter, due to strong development for food and beverage.

Dairy North America demand​

In North America demand was driven by investments in increased capacities for yoghurt manufacturing, while the Chinese dairy industry remained without large projects.

The refrigeration market unit also reported some continued growth, even as demand was on the weak side in the Nordic and Benelux countries.

Operating income for the Equipment division fell during the second quarter 2012 compared to the corresponding period last year and is mainly explained by higher costs and a lower production pace in certain factories, said the company.

Food Technology is part of the Process Technology division and showed an increase compared to the first quarter, particularly driven by the development in the beverage and viscous food markets.

The market units for brewery and vegetable oil remained in line with the previous quarter.

Food Technology made up 8% of total orders received in Q2 for the business.

Growth in Asia​

The Equipment and Process Technology division reported growth in Asia with Food Technology among the best performing segments.

Order intake declined in North America due to fewer large projects but industrial equipment and food and process industry were the segments reporting the largest growth.

In Latin America the Process Technology Division showed a decline due to the non-repeat of large orders but the equipment division reported growth as order intake was unchanged.

The firm launched the unique Sampling Valve and Opitgo CC heat exchanger in the quarter.

The Unique Sampling valve is for use in the dairy, food and beverage, personal care and biopharm industries and offers high operational reliability, enhanced cleanability and ease of operation and maintenance, said the firm.

The Optigo CC air heat exchangers were launched in response to market demands for better energy efficiency.

They are optimized for environmentally-friendly refrigerants, designed for small to medium-sized commercial applications such as supermarkets, restaurants and chilled food distribution depots.

Lars Renström, president and CEO, said: “The demand for the process technology division remained on a continued high level. The demand was strongest from the process industry. The equipment division achieved growth at the end of the quarter due to seasonality​.

“We expect that demand during the third quarter 2012 will be on about the same level as in the second quarter​.”