Atlas Copco Group

Atlas Copco Group Q2 Results July 18, 2005 www.atlascopco.com

Contents • Q2 Business Highlights • Market Development • Business Areas • Financials • Outlook www.atlascopco.com

Q2 - Highlights • Customer demand remained favorable • Very strong performance by all business areas • Record sales • Record profits • Increased sales and marketing activities • Important orders received for new applications and in focused markets www.atlascopco.com

Q2 - Figures in summary • Order received up 24% • Revenues reached MSEK 13 062 (10 680), up 22% • Operating profit at MSEK 2 292, a margin of 17.5% (14.8) • Profit after financial items up 42% to MSEK 2 128 (1 502) • Earnings per share increased to SEK 2.32 (1.76) • Capital gain on professional electric tools divestment not included. Final closing balance will be decided in arbitration • Operating cash flow at MSEK 955 (774) • ROCE at 25% www.atlascopco.com

Orders received - Local currency June 2005 Group total +22% YTD, +23% last 3 months(Structural change +10% YTD, +10% last 3 months) 35 +14 +18 37 +26 +25 13 +18 +22 6 +30 +33 5 +58 +42 4 +34 +28 A= Portion of Group sales last 12 months, % A B C B= Year-to-date vs prev. year, % C= Last 3 months vs prev. year, % www.atlascopco.com

Q2 - The Americas June 2005 • Continued strong demand in North America • Increased demand from manufacturing and process industries • Non-residential construction activity improved • Very good demand from the mining industry • Strong demand across the continent in South America 37 +26 +25 5 +58 +42 A= Portion of Group sales last 12 months, % A B C B= Year-to-date vs prev. year, % C= Last 3 months vs prev. year, % www.atlascopco.com

Q2 - Europe and Africa/Middle East June 2005 • Favorable demand in Europe • Continued growth in sales of compressed air equipment and industrial tools to the manufacturing and process industries • Good development for mining and construction equipment, primarily in Eastern Europe and in the Nordic countries • Large orders for liquified natural gas application • Overall positive demand development in Africa / Middle East 35 +14 +18 6 +30 +33 A= Portion of Group sales last 12 months, % A B C B= Year-to-date vs prev. year, % C= Last 3 months vs prev. year, % www.atlascopco.com

Q2 - Asia and Australia June 2005 • Improved demand in Asia • Strong growth in Japan, India and South East Asia • Important orders from the motor vehicle industry in Japan • Orders in China stabilized • Continued good demand in Australia 13 +18 +22 4 +34 +28 A= Portion of Group sales last 12 months, % A B C B= Year-to-date vs prev. year, % C= Last 3 months vs prev. year, % www.atlascopco.com

Volume Growth per Quarter • Change in orders received in % vs. same Quarter previous year www.atlascopco.com

Group Total Sales Bridge www.atlascopco.com

Compressor Technique • Record order intake and revenues • Volume growth 10% • Continued strong sales development in the Americas • Major product launch and steady growth for stationary industrial compressors and aftermarket business • Significant growth for portable compressors and specialty rental business • Large orders for gas- and process compressors • Record profits • Operating margin 18.5% www.atlascopco.com

Compressor Technique • Operating margins restated (IFRS) from 2004 www.atlascopco.com

Construction & Mining Technique • Continued strong demand from the mining industry and improvement in construction • Orders received up 64% • 13th consecutive quarter with volume growth • Strong volume growth for comparable units and in acquired businesses • Acquisitions have improved the geographical balance of sales • Investment of MSEK 40 to extend assembly plant in Örebro, Sweden • The worlds most productive drill rig in operation • Record revenues and profits www.atlascopco.com

Construction & Mining Technique • Operating margins restated (IFRS) from 2004 www.atlascopco.com

Rental Service • Non-residential construction activity improved • Rental revenues increased 14% in USD • Price +9%, volume +5% • Fleet utilization at record level • Improved fleet quality, average age 2.8 years • Profitability improved significantly • All-time high operating profit margin • Return on operating capital at 23% www.atlascopco.com

Rental Service Rental Revenue Volume Development • Operating margins restated (IFRS) from 2004 www.atlascopco.com

Industrial Technique • Order volume up 10% • Good demand from all major customer segments • Solid development in North and South America, moderate in Europe and strong in the rest of the world • Important new orders for sophisticated fastening tools in Japan • High pace of new product launches • Significantly improved operating margin www.atlascopco.com

Industrial Technique • Operating margins restated (IFRS) from 2004 www.atlascopco.com

Income Statement www.atlascopco.com

Balance Sheet www.atlascopco.com

Cash Flow www.atlascopco.com

Capital Expenditures in Tangible Fixed Assets Net rental fleet investment = MSEK 2 767 MSEK 12 months Quarterly 2001 2002 2003 2004 2005 www.atlascopco.com

Near-term Outlook The demand for Atlas Copco’s products and services is expected to remain at a high level. Demand from manufacturing and process industries is expected to stay favorable. Activity in the construction industry is expected to continue to increase somewhat. Demand from the mining industry is expected to remain strong. www.atlascopco.com

www.atlascopco.com

Cautionary Statement • “Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially effected by other factors like for example, the effect of economic conditions, exchange-rate and interest-rate movements, political risks, impact of competing products and their pricing, product development, commercialization and technological difficulties, supply disturbances, and the major customer credit losses.” www.atlascopco.com

Atlas Copco Group