Sandvik as an investment

We continue to thrive on our value creating offering of productivity and sustainability based on more than 150 years of leading materials and applications know-how. We stay relevant by advancing the world through engineering, expanding our core competencies and adding new digital technologies, enabling us to broaden our customer offering. Our market-leading position and strong customer relationships combined with a decentralized organization enable us to respond faster to market trends and customer needs.

In a cyclical world, our decentralized business model helps us to be more flexible, reduce earnings volatility and increase predictability. Our proven resilience in earnings and a strong balance sheet creates a solid platform from which to leverage interesting growth opportunities.

Market-leading positions – the customer’s first choice

• By providing products and services that improve customers’ productivity and sustainability we ensure our market-leading positions and can maintain value-based pricing
• Strategic and long-term relationships with our customers combined with a decentralized decision model enable us to adapt faster to current and future needs
• About 4 percent of our annual revenues are spent on R&D to ensure a leading product offering
• High barriers to entry, resulting from leading technology position, capital intensity and materials know-how

Solid financial position supports shift to growth

• A solid balance sheet, good cashflow generation and a net cash position
• Growth target of at least 5 percent through a business cycle to come from organic and acquired growth
• CAPEX at <SEK 4 billion annually
• Investments in product development, digitalization and automation
• Acquisitions to broaden our value-creating offering, lead digitalization and automation and expand geographically in faster growing markets

Agile through cycle – strong financial performance

• Proven resilience in economic downturns
• Fast adoption through structural and volume cost-savings initiatives
• Solid adjusted EBIT margin, excluding metal price effects, of 17.1 percent delivered in 2020, above trough margin target of 16.0 percent, despite a significant drop in volumes
• Continuous work to improve cost structures and operational efficiency

Shareholders rewarded

Shareholders rewarded

• Responsible and value-creating capital allocation
• Target of 50 percent dividend pay-out ratio through a business cycle
• 10-year average: 66 percent dividend ratio 3 percent yield
• During 2020, the Board decided to continue the process for a separate listing of Sandvik Materials Technology¹⁾