Electrolux Interim Report Q4 2010 Presentation

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Highlights of the fourth quarter of 2010. Net sales amounted to SEK 27,556m (28,215) and income for the period was SEK 677m (664), or SEK 2.38 (2.34) per share. Net sales increased by 1.6% in comparable currencies.

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Electrolux Interim Report Q4 2010 Presentation

  1. 1. 2010 ResultsFebruary 2, 2011Keith McLoughlin,President and CEOJonas Samuelson, CFOPeter Nyquist, SVP IR
  2. 2. EBIT Target 2
  3. 3. Q4 HighlightsEBIT (SEKm) Margin (%)2500 10 Net sales increased by 7,2 8 1.6% in comparable2000 6,2 6 currencies1500 4 – Strong growth in Latin America and Asia/Pacific 21000 0 EBIT amounted to500 SEK 1,714m -2 – Raw-material headwinds 0 -4 2009 2010 – Cost savings (SEKm) Q4 2010 Q4 2009 2010 2009 Sales 27,556 28,215 106,326 109,132 – Price pressure EBIT* Margin 1,714 6.2% 2,023 7.2% 6,494 6.1 5,322 4.9 – Mix improvement *) EBIT excluding items affecting comparability 3
  4. 4. Q4 Operating cash flow Q4 cash flow reflects normal seasonal pattern – Increased sales – Declining inventories Low sales and production in Q409 Extra contributions to pension funds in Q409 Higher level of investments compared to last year Continued underlying improvement of net operating working capital 4
  5. 5. Olympic acquisition- Temporarily on hold Platform for further growth Synergies within three areas Egypt – Industrial hub Utilize Electrolux technology Olympic Group – Market and platforms leader in Egypt Increase sales outside Egypt Strong industrial and Use cost-efficient sourcing management capabilities base Strong alliance with Electrolux – Speed up the regional growth plans 5
  6. 6. Consumer Durables Europe, Middle East & AfricaEBIT (SEKm) Margin (%)1500 12 QUARTER 4 2010 Lower sales as a result of lower 10 volumes and prices1000 7,5 8 Lower EBIT – Lower volumes 5,3 6 – Price pressure – Higher marketing investments 500 4 – Cost-reduction measures continue to generate savings 2 Good market acceptance for 0 0 newly launched AEG products 2009 2010 Lower operating income for floor- (SEKm) Q4 2010 Q4 2009 2010 2009 care products due to cost Sales 10,760 11,731 40,038 44,073 increases EBIT 565 875 2,703 2,349 Margin 5.3% 7.5% 6.8 5.3 6
  7. 7. Increased growth in Eastern Europe Quarterly comparison, year over year 10% 5% 0% -5% -10% -15% 2006 2007 2008 2009 2010 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4West. Europe 4% 1% 1% 5% 1% 1% -1% -5% -4% -4% -5% -8% -9% -9% -4% -2% 1% 0% 0% 0%East. Europe 1% 9% 6% 7% 14% 5% 5% 10% 6% 5% 4% -15% -31% -30% -26% -17% -7% 1% 5% 13% 7
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  10. 10. Consumer DurablesNorth AmericaEBIT (SEKm) Margin (%)800 8 QUARTER 4 2010 Market turned into growth 5,7600 6 Lower net sales 4,3 – Exited less profitable volumes400 4 – Increased sales at campaign prices200 2 EBIT amounted to SEK 317m – Higher raw-material costs 0 0 – Lower volumes – Price pressure-200 -2 2009 2010 – Improved mix (SEKm) Q4 2010 Q4 2009 2010 2009 Lower sales and operating Sales 7,401 7,865 33,776 35,726 income for floor-care products EBIT 317 450 1,574 1,476 Margin 4.3% 5.7% 4.7 4.1 10
  11. 11. North America grew by 2% in Q4, drivenby the aggressive price promotions Quarterly comparison, year-over-year15%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 2006 2007 2008 2009 2010 11
  12. 12. Consumer Durables Latin AmericaEBIT (mSEK) Margin (%)500 10,0 QUARTER 4 2010 8,4 Market growth in Brazil and in 7,4400 7,5 rest of Latin America Operating income amounted300 to SEK 392m 5,0200 – Higher volumes – Consolidation of retailers led to 2,5100 negative customer mix – Increased raw-material costs 0 0,0 2009 2010 High market acceptance for (SEKm) Q4 2010 Q4 2009 2010 2009 new products Sales 5,304 4,401 17,276 14,165 EBIT 392 368 1,080 878 Margin 7.4% 8.4% 6.3 6.2 12
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  14. 14. Consumer Durables Asia/PacificEBIT (SEKm) Margin (%)400 14,0 QUARTER 4 2010 11,2 12,0 Australia: Market stabilization300 and improved EBIT 9,1 10,0 – Positive currency impact 8,0200 – Improved efficiency 6,0 – Increased raw-material costs100 4,0 – Increased price pressure 2,0 Southeast Asia and China 0 0,0 – Market-share gain in strong 2009 2010 markets (SEKm) Q4 2010 Q4 2009 2010 2009 Sales 2,434 2,295 8,836 8,033 EBIT 272 208 928 458 Margin 11.2% 9.1% 10.5 5.7 14
  15. 15. Professional ProductsEBIT (SEKm) Margin (%) 300 14,7 15,0 QUARTER 4 2010 250 11,7 Food-service 12,0 – Increased sales of own 200 9,0 products 150 – Improved customer mix 6,0 100 – Improved cost efficiency 50 3,0 Laundry products – Higher EBIT with lower sales 0 0,0 2009 2010 – Price increases – Improved cost efficiency (SEKm) Q4 2010 Q4 2009 2010 2009 Sales 1,657 1,923 6,389 7,129 EBIT 243 225 743 668 Margin 14.7% 11.7% 11.6 9.4 15
  16. 16. Q1 and FY 2011In accordance with forward looking statements in the CEO-letter Q1 2011 FY Comment Tough comparablesVolumes Lower Higher in US Q1 Announced pricePrice Weaker ? increases in US Continued mix improvementMix Positive Positive from product launches 2011: SEK 1.5-2 billion costRaw-material costs Higher Higher increase compared to 2010Costs from Global Approximately evenly SEK 125m SEK 500mOperations distributed between quarters Manufacturing Approximately evenly SEK 125m SEK 500m footprint savings distributed between quarters 16
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  18. 18. 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. 18

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