2010 ResultsFebruary 2, 20112010 ResultsFebruary 2, 2011Keith McLoughlin,President and CEOJonas Samuelson, CFOPeter Nyquist, SVP IR
Keith McLoughlin,President and CEOJonas Samuelson, CFOPeter Nyquist, SVP IR
2
EBIT Target
3
Q4 Highlights
6,2
7,2
0
500
1000
1500
2000
2500
-4
-2
0
2
4
6
8
10 Net sales increased by 1.6% in comparable currencies– Strong growth in Latin
America and Asia/Pacific
EBIT amounted to SEK 1,714m– Raw-material headwinds– Cost savings– Price pressure– Mix improvement
7.2%
2,023
28,215
Q4 2009
6.1
6,494
106,326
2010
4.9
5,322
109,132
2009(SEKm) Q4 2010
Sales 27,556
EBIT* 1,714
Margin 6.2%
2009
EBIT (SEKm) Margin (%)
2010
*) EBIT excluding items affecting comparability
4
Q4 Operating cash flow
Q4 cash flow reflects normal seasonal pattern– Increased sales
– Declining inventories
Low sales and production in Q409
Extra contributions to pension funds in Q409
Higher level of investments compared to last year
Continued underlying improvement of net operating working capital
5
Olympic acquisition- Temporarily on hold
5
Platform for further growthEgypt – Industrial hubOlympic Group – Market leader in EgyptStrong industrial and management capabilities Strong alliance with Electrolux– Speed up the regional
growth plans
Synergies within three areasUtilize Electrolux technology and platformsIncrease sales outside EgyptUse cost-efficient sourcing base
6
Consumer DurablesEurope, Middle East & Africa
5,3
7,5
0
500
1000
1500
0
2
4
6
8
10
12
EBIT (SEKm) Margin (%)
5.3%
565
10,760
Q4 2010
7.5%
875
11,731
Q4 2009
5.3
2,349
44,073
2009
6.8
2,703
40,038
2010(SEKm)
Sales
EBIT
Margin
2009 2010
QUARTER 4 2010Lower sales as a result of lower volumes and pricesLower EBIT– Lower volumes– Price pressure– Higher marketing investments– Cost-reduction measures continue to
generate savings
Good market acceptance for newly launched AEG productsLower operating income for floor-care products due to cost increases
7
Quarterly comparison, year over year
-15%
-10%
-5%
0%
5%
10%
Increased growth in Eastern Europe
East. Europe
West. Europe
2006 2007 2008 2009
6%
-4%
Q1
10%
-5%
Q4
5%
-1%
Q3
5%
1%
Q2
14%
1%
Q1
7%
5%
Q4
6%
1%
Q3
9%
1%
Q2
1%
4%
Q1
5%
-4%
Q2 Q3
-5%
4%
Q4
-8%
-15%
Q1
-9%
-31%
Q2
-9%
-30%
Q3
-4%
-26%
Q4
-2%
-17%
Q1
1%
-7%
2010
Q2
0%
1%
Q3
0%
5%
Q4
0%
13%
8
9
10
Consumer DurablesNorth America
4,3
5,7
-200
0
200
400
600
800
-2
0
2
4
6
8 QUARTER 4 2010Market turned into growth Lower net sales– Exited less profitable volumes– Increased sales at campaign prices
EBIT amounted to SEK 317m– Higher raw-material costs– Lower volumes– Price pressure– Improved mix
Lower sales and operating income for floor-care products
2009
EBIT (SEKm) Margin (%)
2010
4.3%
317
7,401
Q4 2010
5.7%
450
7,865
Q4 2009
4.1
1,476
35,726
2009
4.7
1,574
33,776
2010(SEKm)
Sales
EBIT
Margin
Quarterly comparison, year-over-year
-20%-15%-10%
-5%0%5%
10%15%
11
North America grew by 2% in Q4, driven by the aggressive price promotions
2006 2007 2008Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2009Q2 Q3 Q4 Q1
2010Q2 Q3 Q4
12
Consumer DurablesLatin America
7,4
8,4
0
100
200
300
400
500
0,0
2,5
5,0
7,5
10,0
2009
EBIT (mSEK) Margin (%)
2010
7.4%
392
5,304
Q4 2010
8.4%
368
4,401
Q4 2009
6.2
878
14,165
2009
6.3
1,080
17,276
2010(SEKm)
Sales
EBIT
Margin
QUARTER 4 2010Market growth in Brazil and in rest of Latin AmericaOperating income amounted to SEK 392m– Higher volumes– Consolidation of retailers led to
negative customer mix– Increased raw-material costs
High market acceptance for new products
13
14
Consumer DurablesAsia/Pacific
11,2
9,1
0
100
200
300
400
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
2009
EBIT (SEKm) Margin (%)
2010
11.2%
272
2,434
Q4 2010
9.1%
208
2,295
Q4 2009
5.7
458
8,033
2009
10.5
928
8,836
2010(SEKm)
Sales
EBIT
Margin
QUARTER 4 2010Australia: Market stabilization and improved EBIT– Positive currency impact– Improved efficiency– Increased raw-material costs– Increased price pressure
Southeast Asia and China– Market-share gain in strong
markets
15
Professional Products
14,7
11,7
0
50
100
150
200
250
300
0,0
3,0
6,0
9,0
12,0
15,0
2009
EBIT (SEKm) Margin (%)
2010
14.7%
243
1,657
Q4 2010
11.7%
225
1,923
Q4 2009
9.4
668
7,129
2009
11.6
743
6,389
2010(SEKm)
Sales
EBIT
Margin
QUARTER 4 2010Food-service– Increased sales of own
products– Improved customer mix– Improved cost efficiency
Laundry products– Higher EBIT with lower sales– Price increases– Improved cost efficiency
1616
Q1 and FY 2011In accordance with forward looking statements in the CEO-letter
Q1
Volumes
Price
Mix
Raw-material costs
2011 FY
Lower
Positive
Weaker
Comment
Costs from Global Operations SEK 125m
Manufacturing footprint savings
Higher
SEK 125m
Higher
?
Positive
Higher
SEK 500m
SEK 500m
Tough comparables in US Q1
Announced price increases in US
Continued mix improvement from product launches2011: SEK 1.5-2 billion cost increase compared to 2010
Approximately evenly distributed between quarters
Approximately evenly distributed between quarters
17
18
Factors affecting forward-looking statements
Factors affecting forward-looking statementsThis presentation contains “forward-looking” statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Such statements include, among others, the financial goals and targets of Electrolux for future periods and future business and financial plans. These statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially due to a variety of factors. These factors include, but may not be limited to the following: consumer demand and market conditions in the geographical areas and industries in which Electrolux operates, effects of currency fluctuations, competitive pressures to reduce prices, significant loss of business from major retailers, the success in developing new products and marketing initiatives, developments in product liability litigation, progress in achieving operational and capital efficiency goals, the success in identifying growth opportunities and acquisition candidates and the integration of these opportunities with existing businesses, progress in achieving structural and supply-chain reorganization goals.