Electrolux Annual General Meeting 2013


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Speech at Electrolux AGM 2013 by Keith McLoughlin, President and CEO Electrolux, March 26, 2013

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Electrolux Annual General Meeting 2013

  1. 1. Annual GeneralMeeting 2013Keith McLoughlin,President and CEOMarch 26, 2013
  2. 2. 222012
  3. 3. Summary Full-Year 20123*) Growth in comparable currenciesSEKm109,994(101,598)4,779(2,745)5,182(3,980)Sales+9.4%*EBIT Cash Flow+30% +74%
  4. 4. 4Strongest top-line growth ever0.06%2006 2007 2008 2009 2010 2011 2012Net sales growth(in comparable currencies)Total9.4%Financialtarget 4%OrganicAcquired5.5%3.9%
  5. 5. Improved profitability5*) Excluding items affecting comparability and non-recurring items.EBIT, SEKbn*2011 2012Price/mixRaw material,sourcing etc.Volume CostsavingsAcquisitions3.95.2+++_+~ SEK 2 bn ~ SEK 3 bn
  6. 6. Share price development 20126100120140160180Share price SEKElectrolux57%Index10%Jan2012Dec2012
  7. 7. Intensive launch periodin 2012
  8. 8. ElectroluxInspiration Range8
  9. 9. 99Inspiration Range
  10. 10. AEG Neue Kollektion andZanussi Quadro10
  11. 11. Frigidaire11
  12. 12. Frigidaire OrbitClean Dishwasher12
  13. 13. 13The transformationis paying offFrigidaire
  14. 14. 14UltraPower
  15. 15. 1515UltraPower
  16. 16. 2012 Sustainability Awards16Component ofthe World’s MostEthical Companies(2011-2012)Sustainability Sector Leaderin the world (2006-2012)Sustainability Leaders and Gold Class(2013)“The most sustainable corporations”(2012)Germany: Component of OekomResearch (2012)Climate Sector Leader (2012-2013)The UK:Component ofthe FTSE4GoodIndex Series(2000-2012)France: Component of Vigeo Index
  17. 17. Desired position17...our customers ...our shareholdersAs measured by......our employeesTo be the best appliance company in the worldOur Vision
  18. 18. 18Our StrategyProfitablegrowthOperationalexcellenceInnovation– Products andServices– Brands andDesign– SustainabilityPeople & Leadership
  19. 19. …adding profitable growth to the equationwe can expand value creation19Source: BCG, 1990-2011Cash-flow productivityTop lineMarginMultiple13%1%0.5%0.5%TSR15%CAGR
  20. 20. Group Sales Development2096981001021041061082010 2011 2012 2013Index 100Group Sales(excl Olympic & CTI)
  21. 21. 3004001506001,7003,700Future global demand21Current population in millionsWithin seven years, the middle-class will have grown with 1bn people
  22. 22. Revenue diversification222012 Growth 2017Coremarkets65%Emergingmarkets35%1-2%7-10%Coremarkets50%Emergingmarkets~50%Coremarkets80%Emergingmarkets20%2007 Growth-2.5%10%
  23. 23. 23StrategyProfitablegrowthOperationalexcellenceInnovation– Products andServices– Brands andDesign– SustainabilityPeople & Leadership
  24. 24. Key drivers for profitable growth24PROFITABLEGROWTHSTRONGBRANDSINNOVATIONBest-in-ClassProducts/Services• Relevant• Differentiated360 ConsumerExperience• Higher preference• Higher price
  25. 25. “Innovation Triangle”25Marketing DesignR&DDevelop best-in-classproducts1“70% Preference Rule”2Reduce Time to Market 30%3Continue investing inpremium brands4
  26. 26. 360 Consumer Experience26Pre-PurchaseTouchpointsPost-PurchaseTouchpointsAt-PurchaseTouchpoints
  27. 27. Our Brand Architecture27EU NA LA APRegional brandsPREMIUMMASSMARKETRegional brands
  28. 28. 28ElectroluxGrand Cuisine launch
  29. 29. 2929Grand Cuisine
  30. 30. UltraCaptic30
  31. 31. 3131UltraCaptic
  32. 32. 32StrategyProfitablegrowthOperationalexcellenceInnovation– Products andServices– Brands andDesign– SustainabilityPeople & Leadership
  33. 33. Operational Excellenceenables Innovation33Product costreductionCapital intensity Best-in-class qualityInnovation
  34. 34. Operational ExcellenceRecord setting performance345.60.76.9%5.2%10.2%17.0%1.46.6%13.7%2006 2010 201220110.96.0%12.4%Safety:Quality:Working capital:
  35. 35. Warranty cost and R&D spendin % of net sales352009 2012 2013Forecast1. spend2.32.5
  36. 36. 36StrategyProfitablegrowthOperationalexcellenceInnovation– Products andServices– Brands andDesign– SustainabilityPeople & Leadership
  37. 37. Cornerstones of people planPerformancemanagementOurCultureLearning &DevelopmentOrganization &AccountabilityReward &Recognition
  38. 38. Making apositive everydaydifferencein people’s livesand for our planet.
  39. 39. 39Our StrategyProfitablegrowthOperationalexcellenceInnovation– Products andServices– Brands andDesign– SustainabilityPeople & Leadership
  40. 40. Outlook 2013In accordance with the forward-looking statement40• Growth in emerging markets• North America• Product launches (mix)• Cost savings• Weak Europe & Australia• Inflation-driven cost increases• Geopolitical uncertainty• Investing in Profitable Growth• Investing in Marketing, Design and R&D• Global Operations / Modularization• Maintain Balance Sheet Strength
  41. 41. Electrolux has continously deliveredstrong total return to our shareholders4101 0002 0003 000Electrolux BAverage totalreturn ~16%Six Return IndexAverage totalreturn ~12%1991 1996 2001 2006 2012
  42. 42. Factors affecting forward-lookingstatements43Factors affecting forward-looking statementsThis presentation contains “forward-looking” statements within the meaningof the US Private Securities Litigation Reform Act of 1995. Such statementsinclude, among others, the financial goals and targets of Electrolux for futureperiods and future business and financial plans. These statements arebased on current expectations and are subject to risks and uncertainties thatcould cause actual results to differ materially due to a variety of factors.These factors include, but may not be limited to the following: consumerdemand and market conditions in the geographical areas and industries inwhich Electrolux operates, effects of currency fluctuations, competitivepressures to reduce prices, significant loss of business from major retailers,the success in developing new products and marketing initiatives,developments in product liability litigation, progress in achieving operationaland capital efficiency goals, the success in identifying growth opportunitiesand acquisition candidates and the integration of these opportunities withexisting businesses, progress in achieving structural and supply-chainreorganization goals.
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