Continued improvement in the Group's sales volume is expected during the remainder of the year.

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1 Press release SKF Half-year report 2000 Steady improvement The operating margin for the first half of 2000 amounted to 9.3% (5.3). Excluding the capital gain made in the first quarter the operating margin was 8.8% (4.9). The operating margin for the second quarter amounted to 9.0% (5.5). Market demand continued to increase in the second quarter of Demand in Europe is strengthening, but is somewhat flat in North America. Although still healthy, the demand is not increasing at the same high rate as before in the Asia-Pacific area. Continued improvement in the Group's sales volume is expected during the remainder of the year. The SKF Group reports a profit before taxes for the first half of 2000 of MSEK (618). The profit for the second quarter was MSEK 739 (345). Operating profit for the first half of 2000 amounted to MSEK (1 003). The corresponding figures for the second quarter were MSEK 904 (527). Cash flow after investments before financing amounted to MSEK (831). Cash flow for the second quarter was MSEK 676 (737). Net sales amounted to MSEK (18 920), an increase of 5.1% compared with the figure for the corresponding period in Net sales for the second quarter amounted to MSEK (9 612). The increase in net sales was attributable to: structure 1.0%, volume +6.1%, price/mix +0.8% and currency effect 0.8%. Net profit amounted to MSEK 924 (375) and earnings per share after tax to SEK 8.12 (3.30). Net profit for the second quarter was MSEK 427 (195). The Group's financial net for the first half of 2000 was MSEK -333 (-385). Additions to tangible assets totalled MSEK 531 (582). At the end of June, the 1

2 Group's inventories amounted to 23.5% (25.3) of annual sales. Group solvency was 34.2% (29). Return on capital employed for the 12-month period ended June 30 was 14.8% (-4.1). The average number of employees was (41 886) and the registered number of employees was (42 264). The Industrial Division's external sales for the first half-year amounted to MSEK (4 233), an increase of 1.3%. Total sales (sales and deliveries to external and internal customers) were MSEK The Division's operating result for the first six months was MSEK 789 with an operating margin of 11.0%. Market demand in Europe strengthened during the first half of It continued to grow in the Asia-Pacific area and showed a moderate upturn in North America. During the second quarter, Electrac S.A., a French manufacturer of electromechanical actuators was acquired. SKF already held a minority holding in this company. The acquisition will reinforce SKF's position in the fast-growing market for actuation systems. The launch of the Explorer series has led to an increase in SKF's market share for spherical roller bearings. This is particularly the case for sealed Explorer bearings, which offer the advantages of environmental compatibility and ease of maintenance. The Automotive Division's external sales for the first half-year amounted to MSEK (4 407), an increase of 4.4%. Total sales were MSEK The Division's operating result for the first six months was MSEK 251 with an operating margin of 4.9%. There was a strong increase in market demand from the car segment in North America during the first six months of In Europe, the demand from this segment remained high. The truck business in Western Europe, which is the largest geographical market for the truck business, also reported strong growth. In North America, demand for trucks declined substantially in line with the market. Sales in the vehicle aftermarket are developing positively as an effect of the SKF focus on this area. The Electrical Division's external sales for the first half-year amounted to MSEK 807 (801), an increase of 0.7%. Total sales were MSEK The Division's operating result for the first six months was MSEK 231 with an operating margin of 7.2%. Market demand in Europe continued to grow during the first half of the year and there was strong growth in the Asia-Pacific area. 2

3 Demand developed strongly on all its main markets for the two-wheeler segment, one of the largest within the Division. The Service Division's external sales for the first half-year amounted to MSEK (5 613), an increase of 9.9%. Total sales were MSEK The Division's operating result for the first six months was MSEK 465 with an operating margin of 7.0%. During the first half of 2000 there was good growth in the European market demand. There was also a substantial increase in demand in the Asia-Pacific area. Volumes in North America improved after a slow start to the year. There has been a return to a positive development in Latin America and the Middle East. During the period under review, SKF signed one of its largest aftermarket supply and service contracts with the Kymmene Group in Finland, one of the world's top makers of paper products. The five-year contract will substantially increase SKF's sales to this customer. This achievement is the outcome of SKF's added value solutions including competence in the areas of e-commerce, condition monitoring, ongoing improvement projects, inventory management, cost reduction and failure analysis. During the quarter, SKF purchased Diagnostic Instruments Ltd., Edinburgh, United Kingdom. DI's technology coordinates well with SKF's condition monitoring business and will position SKF firmly in the fast-growing niche market for industrialized mobile computing equipment. The Seals Division's external sales for the first half-year amounted to MSEK (1 923), an increase of 9.5%. Total sales were MSEK The Division's operating result for the first six months was MSEK 97 with an operating margin of 4.0%. Market demand during the first half of the year reported positive development with regard to both external customers and internal deliveries. SKF acquired Sealpool AB during the second quarter. Sealpool is a leading supplier in Scandinavia of sealing systems, and its product range complements SKF's current portfolio. The acquisition will strengthen SKF's position in the market for industrial sealing systems. The Steel Division's external sales for the first half-year amounted to MSEK 959 (859), an increase of 11.6%. Total sales were MSEK The Division's operating result for the first six months was MSEK 130 with an operating margin of 5.4%. The market demand for steel and forging products is strong and an increase in deliveries is planned for the second half of the year. 3

4 Parent Company Profit before taxes in the first half of 2000 amounted to MSEK 184 (484). The company had no net sales. Investments amounted to MSEK 0 (2). As of June 30, short-term financial assets amounted to MSEK 1 (2). The average number of employees was 118 (135). Göteborg, July 18, 2000 Aktiebolaget SKF (publ.) Sune Carlsson President Enclosures: Consolidated financial information Consolidated balance sheets Consolidated statements of cash flow Consolidated financial information - yearly and quarterly comparisons (Group and Divisions) This report has not been audited by the Company's auditors. SKF's report on the first nine months of 2000 will be published on Thursday, October 19, Further information can be obtained from: Lars G Malmer, Group Communication, tel , lars.g.malmer@skf.com Marita Björk, Investor Relations, tel , marita.bjork@skf.com Aktiebolaget SKF, SE Göteborg, Sweden phone: , fax: , telex: 2350, 4

5 CONSOLIDATED FINANCIAL INFORMATION (MSEK) Enclosure 1 Jan-Jun 2000 Jan-Jun 1999 MSEK % MSEK % Net sales Cost of goods sold* Gross profit Selling and administrative expenses* Other operating income/expense - net Operating profit Financial income and expense - net Profit before taxes Taxes Profit after taxes Minority interest Net profit Earnings per share after tax, SEK Number of shares Additions to tangible assets Number of employees registered Return on capital employed for the 12-month period ended June 30, % * Beginning in 2000, operating expenses for the Group are classified as cost of goods sold and/or selling and administrative expenses based on the type of operation rather than the type of expense. Previous years have been restated in accordance with new principles. 5

6 Enclosure 2 CONSOLIDATED BALANCE SHEETS (MSEK) June 2000 Dec Intangible assets Tangible assets Investments and long-term financial assets Total capital assets Inventories Short-term assets Short-term financial assets Total short-term assets TOTAL ASSETS Shareholders' equity Provisions for pensions and other postretirement benefits Provisions for taxes Other provisions Total provisions Long-term loans Other long-term liabilities, including minority interest Total long-term liabilities Short-term loans Other short-term liabilities Total short-term liabilities TOTAL EQUITY, PROVISIONS AND LIABILITIES

7 Enclosure 3 CONSOLIDATED STATEMENTS OF CASH FLOW (MSEK) Jan-Jun 2000 Jan-Jun 1999* Profit before taxes Depreciation on tangible assets and goodwill amortization Net gain on sales of tangible assets and businesses Taxes Changes in working capital Cash flow from operations Investments in tangible assets and businesses Sales of tangible assets and businesses Changes in equity securities Cash flow after investments before financing Change in loans Change in pensions Change in long-term financial assets Cash dividends, AB SKF shareholders Cash effect on short-term financial assets Change in short-term financial assets January Cash effect Exchange rate effect 0-25 June Change in net interest-bearing liabilities Opening Exchange rate Change in Acquired and Closing balance effect loans/assets sold companies balance Loans, long- and short-term Provisions for pensions Financial assets, long-term short-term Net interest-bearing liabilities * Previously published amounts have been restated since the items included in Net interest-bearing liabilities are disclosed individually in the cash flow analysis. 7

8 Enclosure 4 CONSOLIDATED FINANCIAL INFORMATION - QUARTERLY COMPARISONS (GROUP) (MSEK unless otherwise stated) Full Full Halfyear year year /99 2/99 3/99 4/ /00 2/ Net sales Operating profit/loss Profit/loss before taxes Earnings/loss per share after tax, SEK Solvency, % Additions to tangible assets Net worth per share, SEK Return on capital employed for the latest 12-month period, %

9 CONSOLIDATED FINANCIAL INFORMATION - QUARTERLY COMPARISONS (DIVISIONS) (MSEK unless otherwise stated) Enclosure 5 Full year Full year Half-year /99 2/99 3/99 4/ /00 2/ Industrial Division External Sales Total sales Operating result Invested capital Registered number of employees Automotive Division External Sales Total sales Operating result Invested capital Registered number of employees Electrical Division External Sales Total sales Operating result Invested capital Registered number of employees Service Division External Sales Total sales Operating result Invested capital Registered number of employees Seals Division External Sales Total sales Operating result Invested capital Registered number of employees Steel Division External Sales Total sales Operating result Invested capital Registered number of employees The financial information per Division is based on SKF's Management reporting, which in certain areas differs from the Group reporting. The sum of operating results and invested capital for the Divisions therefore differs from the reported Group figures. Total sales are sales and deliveries to external and internal customers. Invested capital is defined as the sum of Inventories, external Trade Accounts Receivable and Tangible Assets less external Trade Accounts Payable. Previously published amounts for external sales have been restated to conform to current Group structure. 9