Husqvarna Reports Profit Decrease Jul 21, 2008

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Husqvarna AB reported a drop in 2Q profit and said that it expects no improvement in markets in the third quarter, given rising European inventories and wet weather. Sales slipped 14% to 10.34 billion kronor.

"The decline in net sales and operating income is due mainly to considerably lower shipments for Consumer Products in North America, which decreased in line with overall industry shipments," the company said in a statement.

Sales of Gardena irrigation products also declined with Husqvarna blaming adverse weather conditions.

The company said overall retail inventories of its products stood at roughly the same level at the end of the second quarter as in the prior-year period, with a decline in the United States and an increase in Europe.

"The inventory levels and weaker consumer confidence may have a negative impact on the Group's shipments in the third quarter of 2008, even though this quarter is of less importance in terms of gardening products," the company said.

Weather conditions in the current period may also affect retail sales and industry shipments in the quarter, it said.

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