By Niklas Pollard
STOCKHOLM (Reuters) - Sweden's SKF, the world's biggest maker of industrial bearings, reported adjusted first-quarter earnings that topped market expectations in the face of slowing demand and said it expected softer like-for-like sales in the second quarter.
The manufacturer, whose bearings are sold into a vast range of products globally, said it expected markets to remain volatile amid geopolitical uncertainty and stood by its guidance for a small drop in like-for-like sales for the full year.
SKF reported adjusted operating earnings of 3.30 billion Swedish crowns ($303 million) in the quarter compared to 3.48 billion a year ago and above a mean forecast of 3.11 billion, according to a LSEG compilation of analyst estimates.
The rival of Germany's Schaeffler has spent recent years battling steep cost inflation that it has largely offset through efficiency gains and price hikes of its own while demand slowed in all regions toward the end of last year.
"In soft market conditions, we delivered a strong adjusted operating margin of 13.4%, somewhat ahead of Q1 2023. The margin improvement clearly demonstrates our improved resilience," SKF CEO Rickard Gustafson said in a statement.
The Gothenburg-based company, whose bearings are found in products such as cars, tools and wind turbines, forecast a mid-single-digit like-for-like sales decline in the second quarter after sales fell 7% organically in the first quarter.
SKF stood by its outlook for a low-single-digit decline in like-for-like sales for the full year.
($1 = 10.8846 Swedish crowns)