Sandvik announces non-recurring charges for the third quarter
On September 29, 2022, Sandvik announced non-recurring charges impacting its third-quarter results, related to the distribution of Alleima and the ongoing wind-down process in Russia.
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Rhea-AI Summary
On September 29, 2022, Sandvik announced non-recurring charges impacting its third-quarter results, related to the distribution of Alleima and the ongoing wind-down process in Russia. Following the distribution on August 31, Sandvik recognized a capital loss of approximately SEK 4.7 billion. Additionally, a charge of SEK 0.6 billion was recorded for the Russian wind-down, consisting of a write-down of SEK 0.4 billion and provisions for wind-down costs of SEK 0.2 billion. These charges will significantly affect both discontinued and continuing operations.
Positive
- The wind-down process in Russia is progressing according to plan, with no significant remaining asset values.
Negative
- Capital loss of approximately SEK 4.7 billion from the distribution of Alleima.
- Non-recurring charge of SEK 0.6 billion for the wind-down process in Russia.
Details
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STOCKHOLM, Sept. 29, 2022 /PRNewswire/ -- Sandvik will record non-recurring charges related to the distribution of Alleima (former business area Sandvik Materials Technology) and the wind-down process in Russia. These charges will be reported as items affecting comparability in the third quarter. The distribution of Alleima will impact the result of discontinued operations whilst the charges related to the wind-down process in Russia will impact the continuing operations' reported operating results (EBITA).
On August 31, Sandvik distributed the shares in the wholly owned subsidiary Alleima to the shareholders of Sandvik. As a consequence, Sandvik recognizes a capital loss of approximately SEK 4.7 billion, arising from the difference of the net assets of SMT and the fair value of the distribution. The capital loss will be reported as items affecting comparability, on discontinued operations, in the third quarter.
As previously communicated on June 29, Sandvik is winding down operations in Russia (link: home.sandvik/news). As this process is progressing according to plan, Sandvik will now record an additional non-recurring charge of approximately SEK 0.6 billion, calculated at August closing exchange rates. This charge will be treated as items affecting comparability and consists of a write-down of approximately SEK 0.4 billion and approximately SEK 0.2 billion provision for wind-down related costs. Following this non-recurring charge there are no significant remaining asset values or material wind-down costs remaining related to Russia.
Sandvik AB
For further information, contact Louise Tjeder, VP Investor relations, phone: +46 (0) 70782 6374 or Johannes Hellström, Press and Media Relations Manager, phone: +46 (0) 70721 1008.
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SOURCE Sandvik
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