Electrolux Releases 2003 Results, Investigates Plant Closure and Chairman Candidate
Feb 12, 2004
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Swedish-based appliance maker AB Electrolux announced consolidated results for the fourth quarter and full-year of 2003.
For the full-year, net sales declined to 124 million kronor (approx. U.S. $174 billion), down 6.8 percent from 133 million kronor (approx. $18.6 billion) in 2002. Even so, the company posted a profit of 4.7 billion kronor (approx. $660.8 million), or 15.25 kronor (approx. $2.14) a share in 2003, compared with 5 billion kronor (approx. $698 million), or 15.60 kronor a share (approx. $2.18), in 2002.
For the fourth quarter (October to December), Electrolux earned nearly 1.5 billion kronor (approx. $210.9 million), or 3.7 kronor (approx. $0.52) per share, in the r, compared with a loss of 956 million kronor (approx. U.S. $133 million), or 2.8 kronor (approx. U.S. $0.39) a share, from the same period in 2002.
Despite the gain, sales were 28.3 billion kronor (approx. U.S. $3.9 billion) in the fourth quarter, down from 30.6 billion kronor (approx. U.S. $4.2 billion). The appliance maker attributed the decline to currency fluctuation.
For the year, core appliance industry shipments increased 4 percent in the U.S., while shipments of major appliances, including room air-conditioners and microwave ovens, increased by an estimated 8 percent. For the quarter, shipments rose by 7 and 4 percent, respectively.
Sales in Western Europe showed gains, as well as in Asia and Australia, but demand for appliances in Brazil fell, the appiance maker reported.
Electrolux said it plans to boost its annual dividend to 6.5 kronor (approx. U.S. $0.91 cents) from 6 kronor (approx. U.S. $0.84) in 2002 and hopes to seek shareholder approval to redeem about 3 billion kronor (approx. $419 million) in shares.
In other news, Electrolux is investigating a transfer of vacuum cleaner production in Vastervik, Sweden to Hungary and a possible closure of the factory in Vastervik.
The Vastervik factory has approximately 500 employees and manufactures vacuum cleaners primarily for the European market.
According to the first analysis, a possible closure of the plant would incur a total cost of approximately 200 million kronor (approx. $27.9 million) and a yearly saving of about 150 million kronor (approx. $20.9 million).
The company also announced that it plans to name current LM Ericsson chairman Michael Treschow as chairman of Electrolux, after its current chairman, Rune Anderson, declined re-election. Prior to joining LM Ericsson, Mr. Treschow was president and CEO of Electrolux.
In addition, the company proposed Aina Nilsson as a new board member.
The proposals will be submitted at the company's annual meeting in April.
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