Financial Overview

(in million SEK)

	FY2011	FY2010	Rate of change(%)	Factors
Overall
Sales	29,106	27,196	7.0	1)
EBITDA	3,538	3,304	7.1	-
Automotive
Sales	9,360	8,819	6.1	2)
EBITDA	814	908	10.4	-
Sealing Solutions
Sales	6,643	5,783	14.9	3)
EBITDA	1,550	1,071	44.7	-

 

Factor
1) Overall

-For the Company's continuing operations, sales increased 7% in 2011 year-on-year. Organic growth was 11%. Effects of structural changes were 2% and exchange-rate effects were a negative 6%. Structural changes positively impacted net sales.

2) Automotive
-Organic sales increased 15% for full-year 2011 year-on-year, due to the favorable demand for much of the year in the majority of geographic markets and several long-term supply contracts for new platforms for the major automotive manufactures in the US.

3) Sealing Solutions
-Organic sales rose 16% for full-year 2011 year-on-year, due to the strong demand in all segments and geographic areas.

Joint Ventures

-The Company and Freudenberg & Co. KG announced that they have signed an agreement to form a 50/50 joint venture to produce antivibration solutions for light and heavy vehicles. The new joint venture will comprise Trelleborg Automotive's operations in antivibration solutions and Freudenberg's corresponding activities, Vibracoustic. At year-end 2010, the antivibration business of Trelleborg Automotive had annual sales of approximately 7 billion euros and approximately 5,200 associates. In the same year, Vibracoustic generated sales of round 600 million euros and employed about 3,100 people. (From a press release on December 22, 2011)

Divestitures

<Gas spring operation>
-The Company has signed an agreement and finalized the divestment of its gas spring operation. The buyer is the French car parts maker Defta S.A. The operation is located in France and is part of the Trelleborg Automotive business area. The purchase consideration is approximately 60 million Swedish kronor (approximately 6 million euros). The divested operation has annual sales of approximately 110 million Swedish kronor (approximately 12 million euros) and about 110 employees. (From a press release on October 3, 2011)

<Brake hose operation>
-The Company announced that it has finalized the divestment of its operations in brake hoses for light vehicles to French company Flexitech, Inc. (From a press release on April 5, 2011)

-The Company has signed an agreement to divest its operations in brake hoses for light vehicles, which is located in Brazil. The buyer is the French company Flexitech, Inc. The divested business has annual sales of approximately 140 million SEK (approximately 15.7 million euros) and more than 200 employees. All sales are made in the Brazilian market. The purchase consideration amounts to approximately 65 million SEK (approximately 7.3 million euros). The acquisition is expected to be completed during the first quarter of 2011.(From a press release on January 13, 2011)

R&D Expenditure

(in million SEK)

	FY2011	FY2010	FY2009
Overall	574	577	566

R&D Facilities

-Trelleborg Automotive announced that it will inaugurate its new R&D center in Shanghai, China. The new center offers technology relating primarily to noise and vibration-damping brake solutions for passenger vehicles. The R&D center also has a laser scanner that facilitates measuring of vibration levels for various engine components. (From a press release on June 20, 2011)

Product Development

Active Vibration Control (AVC) technology that solves noise issues in hybrid cars
-Trelleborg Automotive announced that it launched its Active Vibration Control (AVC) technology that solves noise issues in hybrid cars. AVC monitors changing noise and vibration conditions by incorporating a microphone in the cabin as an error sensor, rather than the traditional accelerometer mounted adjacent to the actuator. Data from the microphone is fed into an Electronic Control Unit (ECU) that sends a signal to an electromagnetic actuator. The actuator generates a wave of identical amplitude to the waveform of the original disturbance, but with opposite polarization, creating the desired level of destructive interference to reduce or cancel the amplitude of the noise or vibration. The AVC system can also replace the balance shaft, giving a significant overall weight reduction in the vehicle, contributing to further fuel efficiencies. (From a press release on November 14, 2011)

PTFE (polytetrafluoroethylene) based sealing material
-The Company developed a PTFE (polytetrafluoroethylene) based sealing material Turcon M12, which offers improved wear resistance and friction characteristics. The sealing material is applicable for automotive hydraulic components, such as cylinder for convertible, shock absorber and active body control. Turcon M12 was developed by Trelleborg Sealing Solutions Helsingor, Denmark. (From a press release on March 15, 2011)

Capital Expenditure

(in million SEK)

	FY2011	FY2010
Overall	1,075	792
Automotive	374	284
Sealing Solutions	236	180

Investment Outside Sweden

<India>
-Trelleborg Automotive completed capacity expansion of its manufacturing facility for anti-vibration products in Noida, India. The expansion has resulted in a 50 percent increase in manufacturing space. In addition to the anti-vibration currently offered at the Indian facility, the expansion will also see the company introduce production cells for the manufacture of hydromounts at the Noida facility. (From a press release on February 1, 2011)