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Electrolux Interim Report Q2 2011 Presentation

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Highlights of the second quarter of 2011. Net sales amounted to SEK 24,143m (27,311) and income for the period was SEK 561m (1,028) or SEK 1.97 (3.61) per share. Net sales decreased by 2% in comparable currencies mainly as a result of lower prices.

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Electrolux Interim Report Q2 2011 Presentation

  1. 1. Q2 Results,July 19, 2011Keith McLoughlin,President and CEOJonas Samuelson, CFO & COOPeter Nyquist, SVP IR
  2. 2. Q2 HighlightsEBIT (SEKm) Margin (%)2500 8  EBIT declined to SEK 745m – Weak demand2000 5,4 6 – Lower prices1500 1326,0 – Higher costs for raw 4 materials 3,11000 – Higher costs for sourced 696,0 2 products 500  Restore results going 0 0 forward 2010 2011 (SEKm) Q2 2011 Q2 2010 – Increase prices Sales 24,143 27,311 – Cost-efficiency measures EBIT* 745 1,477 Margin 3.1% 5.4% – Global Operations *) EBIT excluding items affecting comparability 2
  3. 3. Q2 Cash flow Operating cash flow amounted to SEK 930m Continued structural improvement of working capital Cash flow reflects normal seasonal pattern – Build-up of inventories – Higher payables Lower operating income than Q2, 2010 Dividend payment for 2010 of SEK 1,850m 3
  4. 4. Acquisition of Olympic Group– accelerating growth in emerging markets Purchase agreement signed – Paradise Capital’s 52% controlling interest acquired – 40.60 EGP per share Mandatory Tender Offer is expected to be finalized July/August 2011Olympic Group2010 (SEK, recurring figures, excluding Namaa & B-Tech)Sales 2.5bnEBIT 280mEBIT margin 11%Net profit 200m 4
  5. 5. Consumer Durables Major Appliances Europe, Middle East & AfricaEBIT (SEKm) Margin (%)  Lower sales as a result of1500 12 lower volumes and price 10 pressure  Lower EBIT1000 8 – Lower volumes 5,3 6 – Lower prices 500 499,0 4 – Higher input and 311,0 2,0 transportation costs 2  Price increases going forward 0 0 2010 2011 (SEKm) Q2 2011 Q2 2010 Sales 7,660 8,603 EBIT 156 453 Margin 2.0% 5.3% 5
  6. 6. Increased growth in Eastern Europe Quarterly comparison, year over year 10% 5% 0% -5% -10% -15% 2006 2007 2008 2009 2010 2011 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2W. Europe 4% 1% 1% 5% 1% 1% -1% -5% -4% -4% -5% -8% -9% -9% -4% -2% 1% 0% 0% 0% -2% -2%E. Europe 1% 9% 6% 7% 14% 5% 5% 10% 6% 5% 4% -15% -31% -30% -26% -17% -7% 1% 5% 13% 13% 12% 6
  7. 7. Consumer DurablesMajor Appliances North AmericaEBIT (SEKm) Margin (%)600 6  Weak demand for appliances 4,7 and lower prices led to lower sales400 4  EBIT declined to SEK 138m – Lower prices 1,8200 2 – Lower volumes (appliances) – Higher raw-material costs 0 0 – Higher transportation costs – Higher costs for sourced products-200 -2  Price increases in place 2010 2011 – Second round starting in August (SEKm) Q2 2011 Q2 2010 Sales 7,544 9,308 EBIT 138 439 Margin 1.8% 4.7% 7
  8. 8. North America is estimated tohave declined by 10% in Q2 Quarterly comparison, year-over-year 15% 10% 5% 0% -5%-10%-15%-20% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2006 2007 2008 2009 2010 2011 8
  9. 9. Consumer Durables Major Appliances Latin AmericaEBIT (SEKm) Margin (%)400 8  Market growth in Brazil at lower pace 5,7 – Strong growth in the rest of300 6 Latin America  EBIT declined to SEK 114m200 4 3,1 – Negative customer mix due to consolidation of retailers100 2 – Increased raw-material costs – Price pressure 0 0 – Increased marketing 2010 2011 investments (SEKm) Q2 2011 Q2 2010 Sales 3,708 3,667 EBIT 114 209 Margin 3.1% 5.7% 9
  10. 10. Consumer Durables Major Appliances Asia/PacificEBIT (SEKm) Margin (%) 300 14  Market growth in Australia but lower EBIT 12 10,2 – Higher raw-material costs 200 9,1 10 – Price pressure 174,0 145,0 8  Southeast Asia and China 6 – Market-share gain in strong 100 4 markets 2 0 0 2010 2011 (SEKm) Q2 2011 Q2 2010 Sales 1,945 2,035 EBIT 177 207 Margin 9.1% 10.2% 10
  11. 11. Consumer Durables Small AppliancesEBIT (SEKm) Margin (%) 400 15  Higher sales in comparable currencies due to higher 12 volumes and improved mix 300 9  Lower EBIT 211 200 6,2 – Higher product costs 114 6 – Increased investment in small 100 domestic appliances 3 1,3 – Price pressure 0 0 – Higher costs for raw materials 2010 2011 (SEKm) Q2 2011 Q2 2010 Sales 1,794 1,966 EBIT 23 122 Margin 1.3% 6.2% 11
  12. 12. Professional Products Food-service & Laundry productsEBIT (SEKm) Margin (%)  Lower sales and lower underlying 400 18,4 20 EBIT for Food-service – Positive effect of SEK 90m related 300 15 to a divestment 12,0 – Lower project sales in Southern 200 177 10 Europe – Higher raw-material costs 100 91 5 – Price increases  Solid results for Laundry products 0 0 – Higher volumes 2010 2011 – Price increases – Negative mix impact (SEKm) Q2 2011 Q2 2010 – Negative FX impact Sales 1,491 1,730 EBIT 274 207 – Higher raw-material costs Margin 18.4% 12.0% 12
  13. 13. Q3 and H2 2011In accordance with forward-looking statementsin the CEO letter Q3 2011 H2 2011 Comment Easier comparablesVolumes Higher Higher in US in Q3 Slightly Increases in NA and Latam,Price Flat gradual increases in Europe in Q4 positive Mix improvement from product SlightlyMix Flat launches offset by negative negative country/customer mix SEK 800m in H2 whereofRaw-material costs Higher Higher SEK 500m in Q3Costs from Global Approximately evenly SEK 125m SEK 250m distributed between quartersOperations Manufacturing Approximately evenly SEK 125m SEK 250m distributed between quarters footprint savings 13
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  15. 15. Factors affecting forward-looking statementsFactors 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 forfuture periods and future business and financial plans. These statementsare based on current expectations and are subject to risks and uncertaintiesthat could 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. 15

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