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Electrolux impressive with larger than expected quarterly report
Thursday, 19 July 2012
Swedish white good company, Electrolux has been getting praises here
and there for reporting an impressive quarterly profit far exceeding
expectations for the second quarter.
Growth is strong in Latin America and Asia and the view is also
positive in the U.S.. The share rises to its highest in over a year.
The maker of vacuum cleaners, refrigerators and stoves made a profit
before tax of Skr993 million in the second quarter. That was Skr170
million more than analysts expected, according to Reuters. The
corresponding period in 2011, profit reached Skr696 million.
However, higher costs for raw materials continued to impact earnings
negatively, but to a lesser extent than in previous quarters. These
higher costs were offset by operational efficiency.
Details
Net sales amounted to Skr 27,763m (24,143) and income for the period was Skr 763m (561), or Skr 2.67 (1.97) per share.
Net sales improved by 15percent of which 5.8 percent was organic
growth, 5.6 percent acquisitions and 3.6 percent changes in exchange
rates.
Operating income improved to Skr 1,150million (Skr 745million), corresponding to a margin of 4.1percent (3.1).
President and CEO Keith McLoughlin commented that the strong
sales and earnings improvement has to do with that Electrolux generated
a record-high organic sales growth during the second quarter and
improved its earnings significantly compared to the same period of last
year.
"Our operations in Latin America and Asia showed strong volume growth
and earnings in North America were up significantly. An important
factor for the positive development in North America was price
increases. In Europe, Electrolux continued to gain market share, but
results were negatively impacted by the weak market development."
The company says that in the second quarter, organic growth accounted
for approximately 6percent, which is a historic record for the
Electrolux appliance business, with both volume and price contributing
positively.
Sales volumes in our Latin American operations were up substantially,
partly driven by government tax incentives in Brazil, and our
operations in Chile and Argentina, originating from the CTI
acquisition, continue to outperform the market.
By Scancomark.se Team
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