* Q2 adjusted EBITA 1.29 bln SEK vs consensus 1.30 bln
* Core profit margin 16.5 pct vs consensus 17.4 pct
(Adds detail, background)
STOCKHOLM, July 17 Swedish engineering group
Alfa Laval on Tuesday forecast flat demand in the
coming months while low capacity utilisation continued to haunt
some plants and put pressure on second-quarter
weaker-than-expected profit margins.
The maker of pumps, heat-transfer products and
fluid-handling equipment saw decent demand in the first quarter
though margins suffered from weak product mix and capacity
utilisation and costs for growing its sales force in emerging
Alfa Laval said capacity and mix issues put pressure on
margins again in the second quarter with its core profit margin
stuck at a five-year low of 16.5 percent, well below the 17.4
percent seen by analysts and the year-ago 19.0 percent.
Worries about the strength of the global economy have also
grown in recent months amid gloomy indicators and signs that the
slowdown previously confined to indebted euro zone countries in
mainly southern Europe has spread north in the region.
On this count, Alfa Laval struck a firmer note.
Order bookings at Alfa, whose products are used by sectors
as disparate as food processing and nuclear energy production,
rose to 7.90 billion crowns in the second quarter from a
year-ago 7.42 billion, topping the 7.67 billion seen by
The company also said it expected demand during the third
quarter to be on about the same level as in the second quarter.
Earnings before interest, tax, amortisation and other items
(adjusted EBITA) dipped to 1.29 billion crowns ($182.85 million)
versus a year-ago 1.34 billion to just undershoot the mean
forecast in a Reuters poll of 13 analysts at 1.30 billion.
Adjusted EBITA is the company's standard measure of
profitability and strips out items that distort comparison.
($1=7.0550 Swedish crowns)
(Reporting by Niklas Pollard and Helena Soderpalm; Editing by