Alfa Laval AB (publ) Interim report July 1 – September 30, 2006

”The demand during the quarter was very strong and order intake increased with 15 percent for Alfa Laval, an increase excluding the acquisition of Tranter of 9 percent. The strongest growth came from Eastern Europe, Nordic and North America. Our focus on profitability, improved internal efficiency and the high capacity utilization resulted in a record operating margin.

The Board has reviewed the Group's financial targets and decided to raise the target for the operating margin (EBITA) to12-15 percent from 10-13 percent.”

Lars Renström, President and CEO, Alfa Laval

Summary of the third quarter 2006:
- Order intake increased to SEK 5,648 (4,918) million, meaning an increase by 17.2 percent excluding exchange rate variations.
- Net sales increased to SEK 4,810 (4,278) million, meaning an increase by 14.7 percent excluding exchange rate variations.
- Adjusted EBITA increased to SEK 760 (479) million, including positive foreign exchange effects of SEK 7 million and reversal of provisions of SEK 40 million.
- Adjusted EBITA-margin increased to 15.8 (11.2) percent.
- Result after financial items increased to SEK 611 (405) million.
- Cash flow from operating activities increased to SEK 715 (485) million.
Summary of the first nine months 2006:
- Order intake increased to SEK 17,346 (13,496) million, meaning an increase by 26.2 percent excluding exchange rate variations.
- Net sales increased to SEK 13,762 (11,647) million, meaning an increase by 15.9 percent excluding exchange rate variations.
- Adjusted EBITA increased to SEK 1,992 (1,231) million, including positive foreign exchange effects of SEK 56 million.
- Adjusted EBITA-margin increased to 14.5 (10.6) percent.
- Result after financial items increased to SEK 1,624 (823) million.
- Result after tax increased to SEK 1,236 (612) million.
- Earnings per share increased to SEK 10.78 (5.19).
- Cash flow from operating activities increased to SEK 1,624 (779) million.

Outlook for the near future

"In most of the markets, geographical as well as customer segments that Alfa Laval serves, a continued very strong demand is expected."

(The outlook for the near future has remained unchanged since the outlook in the fourth quarter and full year 2005 report issued on February 9, 2006.)