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Sandvik pays out to shareholders.

Byline: Niklas Pollard and Victoria Klesty

Speciality steel and tool maker Sandvik posted quarterly profits in line with expectations on Wednesday - and said it would pay 6.7 billion krona to shareholders through dividends and share redemptions.

Sandvik, which has extensive operations in the West Midlands and employs around 1,400 in the UK, posted pretax profit of 1.79 billion Swedish krona (pounds 140 million), up from 1.21 billion in the corresponding quarter a year ago.

The firm, which makes products from steel tubes to milling machines for the auto industry, said it had won market share in the quarter amid continued firm demand.

Order intake rose 17 per cent to 14.2 billion krona (pounds 1.1 billion) on a fixed exchange rate basis and Sandvik said demand in its biggest market, Europe, would stay strong in the first quarter of 2005.

'We see a continued positive development in the European markets,' Sandvik chief executive Lars Pettersson said.

'Germany has already shown relatively robust demand. What one can see is that countries such as Italy and France now show an improvement as well.'

Sales were 14.4 billion krona (pounds 1.1 billion), up from 12.9 billion a year ago. Its operating margin rose to 13.7 per cent from an adjusted 10.9 per cent a year earlier.

Sandvik was widely expected to make a sizeable payment to its owners after sector peers Atlas Copco and SKF made hefty payouts earlier this month.

The firm proposed that 6.7 billion krona would be paid to stockholders, mainly through a redemption of shares.
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Title Annotation:Business
Publication:The Birmingham Post (England)
Date:Feb 10, 2005
Words:267
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