STOCKHOLM, July 21, 2022 /PRNewswire/ -- Highlights of
the second quarter of 2022
- Net sales increased to SEK
33,749m (30,303), corresponding to an organic sales growth
of 0.3%. Strong price execution across all business areas and mix
improvements from product launches contributed to growth, while
volumes declined significantly. Market demand was down in most
regions.
- Operating income amounted to SEK
560m (1,983), corresponding to a margin of 1.7% (6.5).
Supply chain and labor constraints resulted in substantially lower
volumes and higher costs, especially in business area North America.
- Income for the period amounted to SEK
257m (1,383) and earnings per share were SEK 0.93 (4.81).
- Operating cash flow after investments was SEK 403m (1,456).
President and CEO Jonas
Samuelson's comment
In the quarter, organic sales were relatively flat, with
positive price and mix execution offsetting significant production
volume losses and lower consumer demand. As in the first quarter,
we were impacted by significant supply chain challenges. Operating
margin was 1.7%. Business areas Europe and North
America were, however, disproportionally affected, while the
situation improved sequentially for our other two business areas.
The irregular deliveries of multiple components, mainly
electronics, continued to significantly impact our volumes, cause
severe production inefficiencies and increase costs for airfreight
and spot buys. Through my colleagues' dedicated work, we
successfully optimized the use of available components and managed
to deliver solid mix improvements despite these circumstances and a
weakening demand environment. However, we were still not able to
fully meet the demand, particularly in laundry and premium cooking.
We continue to collaborate closely with our suppliers to mitigate
these supply chain constraints and expect sequential improvements
from mid-2022, with continued risks of disruptions relating to the
resurgence of the coronavirus as well as consequences of the war in
Ukraine.
It is truly disappointing that our North American business area
reported a loss in the quarter. The production output and
efficiency challenges driven by supply disruptions and labor
shortages caused a heavy impact on earnings. On top of this we had
an issue with a critical faulty component, which was fixed in the
quarter.
Through strong price execution, we offset significant cost
inflation in the quarter, primarily in raw material and logistics.
We remain confident to do so also for the full year, as we have
done for the past four years. In an inflationary environment, price
increases are more accepted in the market. This, combined with
attractive products, makes us well-positioned to continue to be
successful in raising prices if needed.
With inflation soaring to historically high levels, increased
interest rates, global supply chain constraints, as well as
uncertainty regarding the coronavirus pandemic and the war in
Ukraine, the visibility for the
rest of the year is limited. We maintain our regional market demand
outlook for the full year 2022, with the exception of North America, which is revised to negative.
However, we still estimate demand to be above pre-pandemic levels
except for Latin America and
Russian market's impact on Europe.
We expect the main constraint for industry shipments to switch from
the global supply chain situation in the first half of the year to
a slowdown in consumer demand in the second half.
I am very pleased with the strong consumer demand for our new
innovative products and the earnings contribution from these
launches. This is our most launch-intensive year ever and we expect
the strong earnings contribution from mix for the 2022 full year to
a large extent compensate for the volume decline,
year-over-year.
Providing relevant innovations under well-established brands to
our target consumers is a key driver for profitable growth. One
great example of this is how we strengthen our emerging markets'
water heater offering through an improved user experience,
including increased energy efficiency. A star rating of 4.89 out of
5 in the important Egyptian market really affirms this.
In volatile times as we are now experiencing, it is vital to
continue on our long-term strategic journey while also being
efficient and agile. Our strategic focus has so far been on better
products, more targeted brands, and increased manufacturing
efficiency. We now expand our scope beyond the product itself to
all interactions we have with our consumers, including aftermarket.
Through our new organization, as previously announced, with a
dedicated Commercial & Consumer Journey team, we are ready to
take our game to the next level by getting even closer to the
consumer.
Telephone conference 09.00 CET
A telephone conference is held at 09.00 CET today, July 21. Jonas
Samuelson, President and CEO and Therese Friberg, CFO will comment on the
report.
Details for participation by telephone
Sweden: +4685664 26 51
International/UK: +4433330008 04
U.S.: +16319131422
Pin/Passcode: 33503877#
Slide presentation for download
www.electroluxgroup.com/ir
Link to webcast
https://edge.media-server.com/mmc/p/mtyzd85i
For further information, please contact:
Sophie Arnius,
Head of Investor Relations
+46705908072
Paul Palmstedt, Electrolux Press Hotline
+4686576507
This is information that AB Electrolux is obliged to make
public pursuant to the EU Market Abuse Regulation and the
Securities Markets Act. The information was submitted for
publication, through the agency of the contact person set out
above, at 08.00 CET on July 21,
2021.
This information was brought to you by Cision
http://news.cision.com
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The following files are available for download:
https://mb.cision.com/Main/1853/3603725/1606301.pdf
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Interim Report Q2
2022
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