Electrolux Interim Report Q2 2013 Presentation

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Electrolux Interim Report Q2 2013 Presentation

  1. 1. Q2 Results July 19, 2013 Keith McLoughlin, President and CEO Tomas Eliasson, CFO Peter Nyquist, SVP IR
  2. 2. Q2 Highlights 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 0 1 2 3 4 5 6 2 (SEKm) Q2 2012 Q2 2013 Sales 27,763 27,674 EBIT* 1,112 1,037 Margin* 4.0 3.7 EBIT (SEKm) Margin (%) 4.0 3.7 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. 2012 2013 • Organic growth of 5.9% – Strong growth in Latin America and Asia/Pacific • EBIT of SEK 1,037m – Improved results in North America and Small Appliances – Results offset by soft markets in Europe – Negative currency impact of SEK 181m • Strong cash flow driven by inflow from changes in WC
  3. 3. Sales and organic growth, Q2 SEKbn by geography 3 9.2bn +2.2% 5.8bn +20.9% 0.9bn +20.6% 1.3bn -3.8% 1.5bn +27.8% 9.0bn +3.2%
  4. 4. Sales and EBIT bridge Q2 4 SEKm Q2 2012 Organic Currency translation Currency Transaction Acquisitions/ Divestments Q2 2013 Net sales 27,763 1,545 -1,634 - - 27,674 Growth % - 5.9% -6.2% - - -0.3% EBIT 1,112 106 -56 -125 - 1,037 EBIT % 4.0% 6.9% 3.2% - - 3.7% Dilution/accretion % 0.2% 0.1% -0.5% 0.0%
  5. 5. Q2 Cash flow SEKm 2012 Q2 2013 Q2 Operations 1,770 1,827 Change in operating assets and liabilities 2,793 1,764 Capital expenditure -957 -1,084 Operating cash flow 3,606 2,507 5
  6. 6. Major Appliances Europe, Middle East & Africa 0 100 200 300 400 500 600 0 1 2 3 4 5 6 6 (SEKm) Q2 2012 Q2 2013 Sales 8,216 8,040 EBIT* 205 -2 Margin* 2.5 0.0 EBIT (SEKm) Margin (%) 2.5 0.0 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. 2012 2013 • Weak market development – Volumes continued to decline in key European markets • EBIT at breakeven – Negative country mix partially offset by positive product mix – Negative currency impact – Continued price pressure • Negative contribution from our Egyptian operation. Consumer Durables
  7. 7. -20% -15% -10% -5% 0% 5% 10% 2006 2007 2008 2009 2010 2011 2012 2013 Weak growth in Europe Further weakening in Southern Europe and slow-down in Eastern Europe 7Market Development % W. Eur. +4 +1 +1 +5 +1 +1 -1 -5 -4 -4 -5 -8 -9 -9 -4 -2 +1 0 0 0 -2 -2 -3 -3 -2 -4 -2 -2 -3 +0.3 E. Eur. +1 +9 +6 +7 +14 +5 +5 +10 +6 +5 +4 -15 -31 -30 -26 -17 -7 +1 +5 +13 +13 +12 +7 +9 +5 +3 +2 +2 +3 +2 Quarterly comparison y-o-y
  8. 8. Major Appliances North America 0 150 300 450 600 750 0 1.5 3 4.5 6 7.5 8 (SEKm) Q2 2012 Q2 2013 Sales 8,599 8,448 EBIT* 488 663 Margin* 5.7 7.8 EBIT (SEKm) Margin (%) 5.7 7.8 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. • Positive organic growth – Improvements in price/mix – Volume decline in air-con • EBIT improved to SEK 663m – EBIT margin of 7.8% – Price/mix contribution – Consolidation of cooking production • Gaining market share in core categories Consumer Durables 2012 2013
  9. 9. -20% -15% -10% -5% 0% 5% 10% 15% 2006 2007 2008 2009 2010 2011 2012 2013 Market for core appliances continue to grow in North America 9 Quarterly comparison y-o-y
  10. 10. Major Appliances Latin America 0 100 200 300 400 500 600 700 0 2 4 6 8 10 12 10 (SEKm) Q2 2012 Q2 2013 Sales 5,183 5,472 EBIT* 316 261 Margin* 6.1 4.8 EBIT (SEKm) Margin (%) 6.1 4.8 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. • Organic growth of 17.6% – Volume growth despite slowdown in demand – Positive price/mix • EBIT of SEK 261m – Positive volume, price, mix – Negatively impacted by currency – Higher costs for sourced products • New government incentives for home appliances in Brazil Consumer Durables 2012 2013
  11. 11. Major Appliances Asia/Pacific 0 80 160 240 0 2 4 6 8 10 12 11 (SEKm) Q2 2012 Q2 2013 Sales 2,198 2,227 EBIT* 172 148 Margin* 7.8 6.6 EBIT (SEKm) Margin (%) 7.8 6.6 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. • Weak volumes in Australia – Positive product mix offset by negative customer mix – After a period of price pressure, price increases now implemented • Growth in Southeast Asia and China – Continued strong growth in Southeast Asia – Improved product mix in China Consumer Durables 2012 2013
  12. 12. Small Appliances 0 90 180 270 0 2 4 6 8 10 12 12 (SEKm) Q2 2012 Q2 2013 Sales 2,105 2,104 EBIT* 25 50 Margin* 1.2 2.4 EBIT (SEKm) Margin (%) 1.2 2.4 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. • 6.5% of organic growth – Volume growth in Europe and Asia/Pacific – Strong growth within small domestic appliances • Improved operating income – Higher volumes – Improved price/mix – Unfavorable currency • New product launches gaining traction Consumer Durables 2012 2013
  13. 13. Professional Products 0 100 200 300 0 4 8 12 16 20 13 (SEKm) Q2 2012 Q2 2013 Sales 1,462 1,383 EBIT* 154 112 Margin* 10.5 8.1 EBIT (SEKm) Margin (%) 10.5 8.1 * Excluding items affecting comparability. Non-recurring items are excluded in all figures. Food-service products • Volume decline in Europe • Recovery in US • Lower operating income – Negative country mix – Investments in priority areas Laundry products • Back to positive sales growth • Operating income lower – Restructuring in Europe 2012 2013
  14. 14. Q3 and FY 2013 y-o-y In accordance with forward-looking statements in the CEO letter, press release and previous official statements 14 Q3 FY 2013 Comments Market volumes Slightly Positive Slightly Positive Growth in emerging markets and North America. Weak Europe. Price/Mix Slightly Positive Slightly Positive Latin America and North America positive. Europe will be flat to slightly positive Raw-material costs Flat Positive Steel: Positive Plastics: Negative R&D and Marketing Higher Higher Intensive launch period in 2013. Increased marketing spend in North America and China. Cost savings ~SEK 250m ~ SEK 1bn Global operations, overhead reduction and manufacturing footprint. Logistics, warehousing etc. Higher Higher Overall inflation driven cost increases such as overseas freights and other transportation.
  15. 15. 15 1515
  16. 16. 16 Factors affecting forward- looking statements Factors affecting forward-looking statements This presentation contains “forward-looking” statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Such statements include, among others, the financial goals and targets of Electrolux for future periods and future business and financial plans. These statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially due to a variety of factors. These factors include, but may not be limited to the following: consumer demand and market conditions in the geographical areas and industries in which Electrolux operates, effects of currency fluctuations, competitive pressures 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 operational and capital efficiency goals, the success in identifying growth opportunities and acquisition candidates and the integration of these opportunities with existing businesses, progress in achieving structural and supply-chain reorganization goals.

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