<p style="text-align: center;"><img src="/ueditor/php/upload/image/20251112/1762953671514272.png" title="1762953671514272.png" alt="2.png"/></p><p style="text-align: justify;"><span style="font-family: arial, helvetica, sans-serif; font-size: 12px;">SKF is hosting its Capital Markets Day in Stockholm today. At the event, deeper insights are provided into the strategic direction of both the Industrial and the Automotive businesses post the planned separation of Automotive from SKF Group. Given different business dynamics, manufacturing processes, end markets and success drivers for the Industrial and Automotive business segments, significant value is expected to be unlocked by being two standalone businesses. “We are creating two even sharper businesses with a clearer focus on distinct opportunities to enhance customer value, accelerate growth, as well as improve efficiency and competitiveness”, says Rickard Gustafson, President and CEO. The increased value creation that the separation of the Automotive business is expected to bring is reflected in the new long-term targets and indicative objectives post separation for the Industrial and Automotive businesses respectively.</span></p><p style="text-align: justify;"><span style="font-family: arial, helvetica, sans-serif; font-size: 12px;">SKF also reconfirms its sustainability targets to decarbonize its own operations by 2030 and reach net-zero supply chain by 2050. TheIndustrial business has a resilient foundation with diversified industry verticals, strong geographical coverage and an aftermarket business representing more than half of net sales. To create even more progress, SKF Industrial will reignite growth through high-growth industries and geographies, by scaling services and intelligent solutions, accelerating the Specialized Industrial Solutions business, and exploring small bolt-on M&amp;A opportunities. Moreover, it will continue to drive innovation leadership by differentiating through customer-centric innovation. Lastly, the strategy aims at further strengthening SKF’s business-driven value chain through finalizing the ongoing regionalization and footprint optimization efforts as well as continued optimizing of the supply chain. Financial objectives for the Automotive business SKF’s Automotive business is a well-positioned global player in key growth segments and geographies.&nbsp;After the separation, SKF Automotive will be able to steer investments into high-growth and margin accretive areas while also establishing a leaner and more cost-efficient setup, in line with automotive best practice. The focus will be to continue winning in leading segments, maintaining and strengthening leadership in innovation, and expanding the addressable market. A lean company setup and an automotive-adapted value chain will increase both speed and efficiency in the business.</span></p><p style="text-align: justify;"><span style="font-family: arial, helvetica, sans-serif; font-size: 12px;">Strengthened capital efficiency for the Group post separation On its Capital Markets Day, SKF also provides an update on the ongoing footprint and value chain optimization of the Industrial business. The transformation of SKF’s footprint is targeting a rightsized as well as increasingly automated and regionalized production with higher volumes closer to customers. This will result in increased CAPEX of net sales of approximately 5% up until mid-term, while in the long term it is expected to be around 3.5%. In addition to CAPEX, SKF has identified opportunities to reach its full potential, as reflected in the long-term earnings target of &gt;19%, by continuing the ongoing optimization of the Industrial business. This restructuring is expected to result in high items affecting comparability (IAC), totaling approximately BSEK 5.0 from Q4 2025 through 2028, whereof approximately BSEK 1.5 is non-cash. Furthermore, the Automotive separation is expected to result in additional BSEK 1.5 of charges. Post 2028, IAC is expected to be limited. Leveraging a consolidated and regionalized footprint and supply base is an important part of the Group’s ambition to decrease the net working capital to a normalized 29% in the mid-term and long-term below 27%. “We continue to proactively execute on our strategic initiatives to unlock the full value of our business. The footprint optimization and separation activities will drive long-term profitability, a strengthened capital efficiency, and increase cash flow generation. All in all, it will secure the creation of two successful stand-alone businesses”, says Rickard Gustafson. Timing of the Automotive separation The Automotive separation is proceeding according to plan. Key milestones already achieved include that over 70% of the new positions in Automotive have been filled and more than 70% of the manufacturing channel transfers that are planned pre-spin have been completed. SKF expects, as previously announced, to be operationally ready to list the Automotive business by mid-2026.Listing is subject to the Board of Directors proposing a listing and shareholders’ approval.</span></p>