UPDATE 1-Alfa Laval sees flat demand ahead after Q3 in line
* Core profit (EBITA) 1.20 bln SEK vs forecast 1.22 bln
* Sees Q4 demand flat on Q3, better in Marine & Diesel unit
* Order intake up 4 pct currency adjusted (Adds company comment, background)
STOCKHOLM, Oct 29 (Reuters) - Engineering group Alfa Laval expects demand to be flat in the final three months of the year, it said on Tuesday, after posting third-quarter core earnings in line with expectations.
The Swedish maker of pumps, heat-transfer products and fluid-handling equipment has been squeezed by weakness in the global economy over the last year.
With recovery beginning to take hold, Alfa Laval said demand in the third quarter had been good in Asia, Latin America, and in the oil and gas sector in the United States, the company's biggest market.
Orders received in the third quarter grew 4 percent, adjusted for currencies, but at 7.4 billion Swedish crowns ($1.2 billion) came in slightly below a forecast of 7.6 billion in a Reuters poll.
"We expect demand during the fourth quarter 2013 will be on about the same level as in the third quarter," the company said in a statement.
CEO Lars Renstrom said demand would be slightly better in the Marine & Diesel division where the company did not take any large orders in the third quarter.
Demand in Alfa's other two main divisions - Process Technology and Equipment - was expected to be roughly unchanged.
Earnings before interest, tax, amortisation and other items (adjusted EBITA) rose marginally to 1.20 billion crowns versus 1.18 billion a year-ago, roughly in line with a mean forecast in a Reuters poll of 1.22 billion.
Adjusted EBITA is the company's standard measure of profitability and strips out items that distort comparison.
Lower capacity utilization, a sluggish marine segment and a stronger Swedish crown have hit margins in recent quarters and profitability, at 16.6 percent in the third quarter, remained well below historic peaks above 20 percent.
($1 = 6.3362 Swedish crowns) (Reporting by Stockholm Newsroom; Editing by Mark Potter)
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