Sandvik reduces workforce in Mining and Construction

Sandvik reduces workforce in Mining and Construction

Actions to achieve the goals in Sandvik’s new Group strategy for the Sandvik
Mining and Sandvik Construction business areas have now been identified and
approved. This will result in the workforce being reduced by 400 employees and a
non-recurring cost of about SEK 500 M, which will be recognized in the fourth
quarter of 2011.

In most cases, the global workforce reduction of 400 employees in Sandvik Mining
and Sandvik Construction will only affect a small number of people per country
and per production unit. Local negotiations will be concluded in the first and
second quarters of 2012. The total includes already implemented, ongoing and
planned restructuring activities, such as the workforce reduction announced on 3
November 2011 in Sandvik Mining and Construction’s operations in Sandviken,
Sweden, as a result of the separation of the business area and the relocation of
the head offices of the new business areas.

As part of the review, the two business areas have decided to focus more on the
core operations, and for some smaller products in certain geographical areas,
the sales channels will be adjusted, resulting in more sales via distributors to
achieve better coverage of the regions where market penetration was previously
weaker.

In addition, Sandvik’s legal entity in Algeria will be closed and, as of 2012,
sales will be conducted via distributers in line with the updated strategy.

At the same time, production and sales will be discontinued for a small number
of products that will not form part of the company’s offering in the long term.
Sales of these products represented less than 5% of the joint sales of the two
new business areas in 2011. An adjustment of the inventory value related to
products to be discontinued for the recently acquired Shanghai Jianshi Luqiao
and an adaptation to Sandvik’s stricter depreciation policy for slow-moving
inventory is also included in the review.   

 Sandvik, 18 January 2012

Sandvik Aktiebolag (publ)

Sandvik AB discloses the information provided herein pursuant to the Securities
Markets Act and/or the Financial Instruments Trading Act. The information was
submitted for publication at 9.00 a.m. on 18 January 2012.

For further information, please contact Gert Sköld, EVP Finance and Business
Development, Sandvik Mining and Construction, tel +46 26 26 51 05, or Jan
Lissåker, Vice President Investor Relations, Sandvik AB, tel +46 26 26 10 23.