Electrolux posts upbeat report
AFP/The Local · 27 Oct 2008, 11:22
Published: 27 Oct 2008 11:22 GMT+01:00
The world's leading electric appliance maker stuck to its 2008 growth forecast despite the dark financial climate.
For the July to September period, the company reported a net profit of 847 million kronor ($104.4 million), up 11.2 percent year-on-year.
Electrolux's sales meanwhile remained virtually unchanged at 26.34 billion kronor compared to 26.27 billion a year earlier, according to its earnings report.
The company, in the process of restructuring its business to reduce production costs, thus easily beat analyst expectations that its sales in the third quarter would amount to 25.91 billion kronor, according to a poll conducted by the Dow Jones Newswire.
At the same time, the company's operating profit for the quarter jumped 11.6 percent to 1.28 billion kronor while its margins swelled to 4.9 percent from 4.4 percent in the third quarter of 2007.
Following its earnings announcement, Electrolux saw its stock price jump 2.80 percent to 55.00 kronor a share, in a Stockholm market down 5.40 percent.
Despite the good news, company chief executive Hans Stråberg meanwhile said Electrolux was still feeling the effects of the global financial crisis.
"The financial crisis has without a doubt affected the consumption levels of appliances. Many consumers are postponing their purchases or choosing less expensive products," he said in a separate statement on Monday.
"And there's no evidence that the weak market developments will turn around in the near future," he added.
In the second quarter the group revised sharply downward its growth forecast for 2008, blaming the financial turmoil, but on Monday it said it would not revise down the figure further.
It expects to rake in an operating profit of between 3.3 and 3.9 billion kronor this year, far below the 4.47 billion it made in 2007.
Stråberg refused however to try to predict how demand in the company's different markets would develop going forward.
"We are in the midst of a very uncertain period, where the developments on our main markets-Europe and North America-are not likely to improve in the near future," he said.