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ÅF - Interim report January to September 2009

Published October 21, 2009
For further information, please contact:
Jonas Wiström, President/CEO                      +46 (0)70-608 12 20
Jonas Ågrup, CFO                                  +46 (0)70-333 04 95
Viktor     Svensson,     Director,      Corporate +46 (0)70-657 20 26
Information


 Third quarter 2009

  * Operating income totalled SEK 997 million (Q3 2008: SEK 987
    million)
  * Operating profit was SEK 72 million (SEK 81 million)
  * Operating margin was 7.2  percent (8.2 percent)
  * Earnings per share, before dilution: SEK 2.73 (SEK 3.46)

January-September 2009

  * Operating income totalled SEK 3,404 million (SEK 3,224 million)
  * Operating profit was SEK 278 million (SEK 332 million)
  * Operating margin was 8.2 percent (10.3  percent)
  * Earnings per share, before dilution: SEK 11.25 (SEK 13.67)


A few words from the President, Jonas Wiström:
While the economy has remained weak throughout the third quarter,
there are indications that things have begun to bottom out. There has
been a slight increase in activity in the market since the summer and
ÅF is currently involved in more investment discussions with clients
than was the case six to nine months ago.

After the appropriate adjustments have been made to account for the
reduction in Alecta's pension premiums in 2008, third quarter
operating profit for ÅF in 2009 was slightly higher than during the
corresponding period last year. The operating margin was 7.2 percent
for the quarter, bringing the overall figure for the first nine
months of the year to 8.2 percent. The lower capacity utilisation
rate has been outweighed by reduced costs and a more profitable
portfolio of services. Assignments related to energy and environment
projects worldwide currently account for more than 40 percent of ÅF
sales.

Growth for the first three quarters was 6 percent. Organic growth was
negative.

For ÅF the most important objective is to continue to report levels
of profitability that put us among the best performers in our
industry. At the same time, however, ÅF also has its sights set on
higher growth. Our long-term objective is to grow by 15 percent a
year. Financially the company is in a strong position to make further
acquisitions in our main growth areas of Energy, Energy Efficiency
and Infrastructure Planning. There are also good opportunities for
organic growth in Sweden and abroad. On 15 October ÅF secured second
place among Sweden's most attractive employers in Universum's
2009/2010 survey of 6,000 professional engineers.

Important events during Q3 2009 and after the reporting date

Through its Swiss subsidiary, ÅF-Colenco, ÅF was appointed principal
consultant for a new hydro-electric power plant in Switzerland. The
client is NdD SA, a joint venture between Switzerland's largest
energy producer, Alpiq, and Swiss Federal Railways SBB together with
the regional electricity company FMV. ÅF is responsible for all the
project management and construction services in an order that is
worth 27 million euros for the company.

ÅF was appointed principal supplier of technical consulting services
for the construction of a new 1,000 MW gas-fired power plant in
India. The client and owner of the plant is Tuff Energy, an Indian
industrial conglomerate. The order is worth 1 million euros for ÅF.

Sales and earnings, Q3 2009
Operating income totalled SEK 997 million, a 1 percent increase on
the figure of SEK 987 million for the corresponding period in 2008.

Operating profit amounted to SEK 72 million (Q3 2008: SEK 81
million). The operating margin was 7.2 percent (8.2 percent).
However, the profit for Q3 2008 was affected by a pension premium
reduction from Alecta, which had a positive impact on earnings of SEK
9.5 million.

Capacity utilisation was 72 percent (74 percent).

Profit after net financial items amounted to SEK 67 million (SEK 80
million). The profit margin was 6.7 percent (8.1 percent).

Earnings per share, before dilution, were SEK 2.73 (SEK 3.46).
Sales and earnings, January-September 2009

Operating income totalled SEK 3,404 million, a 6 percent increase on
the figure of SEK 3,224 million for the first three quarters of 2008.

Operating profit amounted to SEK 278 million (Q1-Q3 2008: SEK 332
million). The operating margin was 8.2 percent (10.3 percent).
However, the profit for the first nine months of 2008 was affected by
a pension premium reduction from Alecta, which had a positive impact
on earnings of SEK 28.5 million.

Capacity utilisation was 72 percent (75 percent).

Profit after net financial items amounted to SEK 267 million (SEK 320
million). The profit margin was 7.8 percent (9.9 percent).

Earnings per share, before dilution, were SEK 11.25 (SEK 13.67).

Investments

Gross investment in property, plant and equipment for the period
January to September 2009 totalled SEK 28 million (Q1-Q3 2008: SEK 65
million). In 2008 SEK 33 million were invested in land and buildings
to meet the growth in business for ÅF's Swiss subsidiary ÅF Colenco.

Cash flow and financial position

Operating cash flow for the third quarter was negative, SEK -39
million, as opposed to a positive figure of SEK 6 million for the
corresponding period in 2008. Total cash flow for the period was also
negative at SEK -8 million (Q3 2008: SEK +15 million).

Operating cash flow for the period January-September 2009 was SEK 155
million (SEK 165 million). Total cash flow for the first nine months
was negative, SEK -23 million (SEK +12 million). Acquisitions
completed and additional considerations paid amounted to a total of
SEK 37 million (SEK 95 million).

The Group's liquid assets at the end of the reporting period totalled
SEK 253 million (SEK 334 million).

Equity per share was SEK 99.86 and the equity/assets ratio was 50.1
percent. At the beginning of 2009, equity per share was SEK 99.46 and
the equity/assets ratio was 47.1 percent. The Group's net loan debt
totalled SEK 209 million (SEK 183 million) at the end of the
reporting period.

Number of employees

The total number of employees at the end of the reporting period was
4,319 (Q3 2008: 4,113): 3,109 in Sweden and 1,210 outside Sweden.
Translated into full-time equivalents, this corresponds to 4,185
employees (3,840).

Divisional performance, third quarter 2009


Energy Division                     Operating income Q3, SEK 293
                                    million (SEK 224 m)
                                    Operating margin Q3: 8.1% (12.7%)

                                    Operating income Q1-Q3, SEK 908
                                    million (SEK 668 m)
                                    Operating margin Q1-Q3: 8.5%
                                    (11.4%)


The Energy Division is a front-rank international energy consultant
and a world leader in nuclear power consulting.
The market for energy consulting has picked up slightly since the
summer, as witnessed by an increase in outstanding quotations and
tenders at the same time as incoming orders for the Energy Division's
services have exceeded expectations.

The quarter's highest levels of profitability were reported by the
units in Switzerland and Finland, both of which are involved in major
international project control assignments primarily in Europe and
Asia. In the short term the substantial organic expansion that is
currently taking place in the Energy and Environment business areas
of the division's Swedish operations is having a detrimental impact
on profitability.

Growth in the division is attributable chiefly to the acquisition of
Lonas in Russia (in October 2008). Following a recovery in the
Russian financial system, the energy market in Russia is gradually
picking up strength once more. Lonas won two relatively large orders
in September, one for the construction of a coal-fired power plant
and one for a gas-fired plant. The company reported satisfactory
profits for the third quarter.

The Energy Division's expansion in India is also worthy of mention.
In the third quarter ÅF won four medium-sized consulting assignments
for clients in the sub-continent's thermal power generation industry.
The division has been active in India for several years, working
primarily with hydro-electric power and dam projects. ÅF has an
office in Delhi with a workforce of around 40.


Engineering                               Operating  income  Q3,  SEK
                                          284 million (SEK 300 m)
                                          Operating income margin Q3:
                                          9.3% (6.5%)

                                          Operating income Q1-Q3, SEK
                                          971 million (SEK 1,061 m)
                                          Operating   margin   Q1-Q3:
                                          10.0% (9.8%)


The Engineering Division is Northern Europe's leading technical
consultant for industry.

Engineering noted some signs of a stabilisation in the industrial
economy towards the end of the third quarter. For the first time in
more than 12 months, orders from the mining and steel industry were
up, as were those from clients in the pulp and paper industry. Demand
also remained good from the food processing, pharmaceutical, energy
and nuclear power sectors.

The improvement in the division's earnings is thanks primarily to a
more profitable portfolio of services, better control over
fixed-price projects and continuing downward movements as far as cost
are concerned.

During the course of 2009 the Engineering Division has laid off some
50 employees in sectors where demand for services has been low, which
explains the reduction in sales. At the end of the third quarter,
however, the division once again moved into positive territory in
terms of organic growth.

Engineering won a major hydropower assignment in northern Sweden
during the third quarter, in line with its strategy of expanding in
this segment.


Infrastructure                                Operating income Q3,
                                              SEK 351 million (SEK
                                              404 m)
                                              Operating  margin   Q3:
                                              4.2% (5.7%)

                                              Operating income Q1-Q3,
                                              SEK 1,290 million  (SEK
                                              1,343 m)
                                              Operating margin Q1-Q3:
                                              7.3% (9.6%)


The Infrastructure Division holds a leading position in consulting
services for infrastructure development in Scandinavia. It has
clients in the public sector, the defence sector, industry and the
property market.

The market for the services of the Infrastructure Division dipped
during the first half of the year and has continued to remain at this
lower level in all but two market areas, Infrastructure Planning and
Energy Efficiency in the property sector.

For the division's largest business area, Installations, which
employs a total of 650 consultants in Sweden and Norway,
profitability has fallen as the market for construction-related
services both for industry and among private construction and
property companies has contracted. One area of the market that is
still growing rapidly, even in the midst of the current economic
downturn, is the need for measures to improve energy efficiency in
all types of properties and premises.

The business area that has seen the strongest development in the
third quarter is Infrastructure Planning. In a market that continues
to be driven by large-scale investments in Sweden's road and rail
networks, operations here showed strong organic growth and improved
profits.

Demand for the services of the Product Development business area has
improved slightly after the summer.


Inspection                               Operating income Q3, SEK  98
                                         million (SEK 88 m)
                                         Operating margin  Q3:  12.1%
                                         (13.4%)

                                         Operating income Q1-Q3,  SEK
                                         300 million (SEK 252 m)
                                         Operating margin Q1-Q3: 9.3%
                                         (12.1%)


The Inspection Division works with technical inspections, chiefly in
the form of periodic inspections, testing and certification. The
engineering and nuclear power industries are among the division's
major clients.
The market for technical inspections developed positively during the
third quarter. Demand rose in all the division's areas of expertise,
most significantly for services related to testing. Demand was once
again strongest from the nuclear power industry.

Profits were reduced by investment in equipment and specialist skills
for the nuclear power industry, with costs exceeding the resources
earmarked for this in the budget. Measures will be taken, however, to
reduce development costs and increase income.

Growth for the reporting period is attributable both the acquisition
of the Czech company Qualitest (in September 2008) and to organic
growth in Swedish business operations. In the third quarter the Czech
unit continued to report better than anticipated results.

Parent company

Parent company operating income, primarily for various intra-group
services, totalled SEK 218 million for the period January-September
(Jan-Sept. 2008: SEK 185 million).

The parent company reported a loss of SEK 19 million (SEK -25
million) after net financial items. Cash and cash equivalents
totalled SEK 2 million (SEK 2 million), and gross investment in
machinery and equipment for the period amounted to SEK 3 million (SEK
9 million).

The parent company has increased its participation in Group and
associated companies to SEK 1,903 million (SEK 999 million), due to
internal restructurings of the shareholdings.

Accounting principles

This interim report has been prepared in accordance with IAS 34
("Interim Financial Reporting"). The report conforms with
International Financial Reporting Standards (IFRS), as well as with
statements on interpretation from the International Financial
Reporting Interpretations Committee (IFRIC) as approved by the
European Commission for use in the EU, and with the relevant
references to Chapter 9 of the Swedish Annual Accounts Act. The
report has been drawn up using the same accounting principles and
methods of calculation as those in the Annual Report for 2008 (see
Note 1, page 83). The parent company has implemented the Swedish
Financial Reporting Board's Recommendation RFR 2.1 ("Accounting for
Legal Entities"), which means that the parent company in the legal
entity shall apply all the IFRS and related statements approved by
the EU as far as this is possible, while continuing to apply the
Swedish Annual Accounts Act in the preparation of the legal entity's
accounts.

Risks and uncertainty factors

The significant risks and uncertainty factors to which the ÅF Group
is exposed include business risks linked to the general economic
situation and the propensity of various markets to invest, the
ability to recruit and retain qualified co-workers, and the effect of
political decisions. In addition, the Group is exposed to a number of
financial risks, including currency risks, interest-rate risks and
credit risks. The risks to which the Group is exposed are described
in detail on pages 56-60 of ÅF's Annual Report for 2008. No
significant risks are considered to have arisen since the publication
of the annual report.

ÅF shares

The ÅF share price at the end of the reporting period was SEK 172,
which represents a rise in value of 45 percent since the beginning of
the year. During the same period the Stockholm Stock Exchange
all-share index (OMXSPI index) rose by 37 percent.
Share savings scheme

At the Annual General Meeting of shareholders in ÅF held on 5 May
2009 a resolution was approved to implement a performance-related
share programme aimed at up to 160 key individuals in the ÅF Group,
including the CEO. Participants in the scheme may, during a 12-month
period from the implementation of the programme, save an amount
equivalent to a maximum of 5 percent of their gross salary for the
purchase of ÅF shares on the OMX Nordic Exchange in Stockholm. At the
end of the registration period 110 senior executives had registered
their interest in purchasing approximately 23,400 shares for the
entire 2009 programme. This means that, provided that the performance
targets are met in full, a total of approximately 99,000 shares will
be transferred without consideration to participants during 2012 and
2013. This corresponds to a maximum of 0.6 percent in terms of the
dilution of earnings per share.

During the first quarter of 2009 a total of 45,000 ÅF shares were
acquired by the company. The purpose of these buy-backs was to
safeguard the company's obligations with regard to the 2008
performance-related share programme.

Next financial report

The summary of ÅF's annual report for 2009 will be published on 17
February 2010.


Stockholm, Sweden - 21 October 2009,
ÅF AB (publ)
Jonas Wiström, President & CEO


The information in this interim report is that which ÅF AB is
required to disclose under Sweden's Securities Market Act and/or the
Financial Instruments Trading Act. The information was released for
publication at 08.30 C.E.T. on 21 October 2009.


         ÅF AB (publ) Corporate identity number 556120-6474
            Frösundaleden 2, SE-169 99 Stockholm, Sweden
      Telephone +46 (0)10 505 00 00  Telefax +46 (0)8 653 56 13
                     E-mail: info@afconsult.com
                          www.afconsult.com



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