Electrolux profits slide in weak European climate
Electrolux reported a 28-per cent drop in net profit in the first quarter owing to the weak business climate in Europe and a strong krona. The Swedish company posted a net profit of 361 million kronor (42 million euros, $55 million) in the January to March period, while sales dipped by 2.0 per cent to 25 billion. Those figures came in below the forecasts of analysts surveyed by Down Jones Newswires, who had predicted an average net profit of 519 million and sales of 26 billion. Electrolux said the slowing demand for household appliances in Europe had weighed down revenue, as consumers held back on purchases amid the sluggish economy. Sales in the Europe, Africa and Middle East region slid by 8.1 per cent to 7.6 billion kronor. However, sales improved in the North America and Asia Pacific regions, rising by 8.0 per cent to 7.7 billion and by 5.8 per cent to 1.9 billion respectively. Electrolux said the strong Swedish currency, the krona, had a negative effect of 318 million kronor on its operating profit, which plunged by 30 per cent in the quarter to 638 million kronor. Chief executive officer Keith McLoughlin, speaking to Swedish news agency TT, said there was “no point in p a n i c k i ng” about the c u r r e n cy effects since they could not be controlled. In 2013, demand is expected to decline in Europe but rise in North America, Electrolux said. McLoughlin said the company expected the European market to “be weak and get weaker. We don’t expect any recovery in the first half of the year.” He noted however that Russia, Britain, Finland and Norway were bright spots in Europe.
Electrolux bagless vaccum cleaner