Electrolux Q3 Sales, Profits Climb

Fridge sales impacted by new DOE regs
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Improved U.S. majap demand and a greater mix of higher-margin products contributed to solid sales and earnings gains in Electrolux’s third quarter.

Stockholm, Sweden — Improved U.S. majap demand and a greater mix of higher-margin products contributed to solid sales and earnings gains in Electrolux’s third quarter.

Net sales rose 6 percent to SEK28.8 billion while net income increased 42 percent to SEK933 million for the three months, ended Sept. 30, the Swedish majap maker reported.

In North America, net sales rose 11.3 percent to SEK9.1 billion, driven by a 7 percent increase in majap market demand and favorable exchange rates. Excluding the impact of currency fluctuations, regional sales rose 5 percent during the quarter on strength in premium cooking, laundry and dishwashers.

However, results were curtailed by significant declines in AC and freezer sales during the mild summer, and refrigerator shipments were impacted by a changeover to new, higher-efficiency models in compliance with stricter Department of Energy (DOE) regulations that went into effect during the quarter.

Both factors took a toll on operating income, which fell 8 percent to SEK518 million.

Marketing costs also increased during the quarter, although a greater mix of premium products helped offset price pressures and softer sales volumes, the vendor said.

In a statement, president/CEO Keith McLoughlin described the DOE-mandated product upgrades as “major transitions” that have been “slower and more complex than anticipated.”

However, he said sales growth in North America remains healthy, and that the region’s majap business “continues to deliver results with a good contribution to the [company’s] earnings.”

McLoughlin added, “We are excited about the upcoming transaction to acquire GE Appliances,” which is still on track to close sometime next year.

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