Highlights of the second quarter of 2023
- Net sales amounted to
SEK 32,653m (33,749). The organic sales decline of 8.4% was driven by the continued weak market demand with consumers shifting to lower price points, resulting in significantly lower volumes. Supported by the competitive product offering, mix was flat despite the decline in market demand being particularly evident in key product categories for the Group. Price was somewhat positive although promotions increased significantly. -
Operating income amounted to
SEK -124m (560), corresponding to a margin of -0.4% (1.7). Operating income included a previously announced non-recurring item ofSEK -643m , referring to a provision mainly related to a French antitrust case. Excluding this non-recurring item, operating income amounted toSEK 519m , corresponding to a margin of 1.6% (1.7). -
The Group-wide cost reduction and
North America turnaround program progressed well, resulting in a positive year-over-year impact of approximatelySEK 1.6bn , a substantial sequential step-up in savings. This contributed positively to the underlying operating income year-over-year, while the volume decline impacted negatively. -
Income for the period amounted to
SEK -648m (257) and earnings per share wereSEK -2.40 (0.93). -
Operating cash flow after investments improved materially to
SEK 3,137m (403). -
Preparations to divest non-core assets with total potential value of approximately
SEK 10bn have been initiated as part of the ongoing strategic sharpening. Further structural simplification and complexity reductions are also being evaluated.
President and CEO
The weak market demand environment, with lower consumer purchasing power resulting in more consumers shifting to lower price points, continued also in the second quarter. Lower residential construction and remodeling activity caused significantly weaker demand within the built-in kitchen category, mainly impacting us in
Promotional activity remained high because of the lower consumer demand. Price contributed somewhat positively to earnings, essentially driven by last year's price increases, and thus tapering off in the quarter, while promotions increased significantly compared to last year. Given this, we expect net price to turn negative from the third quarter.
In the second quarter, organic sales declined by 8.4% year-over-year, while underlying operating profit was in line with last year thanks to the execution of the Group-wide cost reduction and
In the quarter, raw material cost was neutral. However, currency deteriorated and we continued to face higher cost inflation from labor and energy, year-over-year. The combined headwind from external factors was to a significant extent offset by price.
On a positive note, we had a material improvement in our operating cash flow after investments in the quarter to
Consumer sentiment related to consumer durables purchases is projected to remain negatively impacted by the high inflation and interest rate environment throughout 2023. Consequently, we expect market demand for full year 2023 to be negative for all regions, and hence revise the outlook for
As part of our ongoing work to sharpen our strategic focus to grow profitably in selected home appliance categories in the mid- and premium segments, primarily under our main brands Electrolux,
In the challenging times we are now experiencing, it is vital to continue with strategic portfolio management to be able to provide attractive and relevant consumer experience innovations under our strategic brands. Further structural simplification and complexity reduction are thus being evaluated to enable increased speed, focus and profitability. Efficiency is a prerequisite and our number one priority this year remains; to deliver on the Group-wide cost reduction and
Telephone conference 09.00 CET
A telephone conference is held at 09.00 CET today,
To only listen to the telephone conference, use the link:
https://edge.media-server.com/mmc/p/sodz9rru
OR
To both listen to the telephone conference and ask questions, use the link:
https://register.vevent.com/register/BI071ca5bc626a4c57bdf64549ff31fd2c
Presentation material available for download
www.electroluxgroup.com/ir
This is information that
For further information, please contact:
Sophie Arnius, Investor Relations, +46 70 590 80 72
Electrolux Group Press Hotline, +46 8 657 65 07
https://news.cision.com/electrolux-group/r/electrolux-group-q2-2023-interim-report,c3807473
https://mb.cision.com/Main/1853/3807473/2197000.pdf
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