Electrolux posts first quarter loss
AFP · 28 Apr 2008, 11:59
Published: 28 Apr 2008 11:59 GMT+02:00
For the first three months of the year, the group registered a net loss of 106 million kronor ($17.7 million) compared to a net profit of 492 million kronor a year earlier.
Excluding items affecting comparability, the net loss amounted to 140 million kronor, Electrolux said in a statement.
The Swedish company issued a profit warning in early April, saying its operating profit would be "somewhat" negative due to declining sales on its main markets in Europe and North America.
The group posted an operating loss of five million kronor, against a profit of 757 million a year earlier. On a directly comparable basis, the loss was 39 million kronor.
The operating profit margin, which was three percent in the first quarter of 2007, fell to minus 0.8 percent for January-March.
Electrolux said its operating result was affected by non-recurring items as well as costs for product launches in the United States, totaling around 550 million kronor.
Among the non-recurring items were 360 million kronor in charges for its restructuring programme as well as 120 million kronor related to a component problem in a series of dishwashers. The costs were offset by a capital gain of 130 million kronor.
In the United States, the launch of a new line of products impacted results by 120 million kronor, in addition to 80 million kronor for litigation costs in Arizona.
Sales dipped by three percent, to 24 billion kronor, with the drop attributed largely to currency exchange rates.
Electrolux said it expected its operating profit for the full year to be in line with that of 2007.
The product launches in North America were expected to have a negative impact on earnings throughout 2008 before turning a profit in 2009.
Meanwhile in Europe, results would continue to be affected by restructuring and product launches.
On the Stockholm stock exchange, Electrolux shares were down 0.80 percent at 92.50 kronor in late morning trading while the OMX30 blue-chip index was up 0.96 percent.