Electrolux 2000 Annual Report Download - page 24

ACQUISITION OF ELECTROLUX BRAND
IN NORTH AMERICA
In May the Group acquired the right to the
Electrolux brand and corporate name in the US
and Canada from Electrolux LCC, an American
company engaged in direct sales of floor-care
products.The purchase price was USD 50m.
Electrolux can now use the brand in North
America within all product areas, except floor-
care products for which the seller has the right
to use the name during a transitional period.
OPERATIONS IN LATIN AMERICA
AND ASIA
Demand for white goods in Brazil was higher
than in the previous year.The Group achieved
a considerable increase in sales volume.
Operating income improved, but remained
negative for the full year.A marked increase in
income was reported for the fourth quarter.
Factors contributing to the favorable trends for
sales and income included internal cost adjust-
ments, gradual renewal of the product range,
and intensified marketing.
In Asia, the market for white goods in-
creased in volume in China and the ASEAN
countries, while demand in India was rela-
tively unchanged.
The Group’s operation in China achieved
a marked increase in sales and reported a result
close to break-even. Good sales growth was
also reported in the ASEAN countries, where
operating income improved considerably. Sales
in India were higher than last year. Operating
income declined, however.
ACQUISITION OF EMAIL IN AUSTRALIA
An agreement was reached in November 2000,
for acquisition of the household appliances
division of Email Ltd in Australia. Email is the
largest producer of white goods in Australia,
with annual sales of approximately SEK 4,700m
and about 4,800 employees.
The acquisition strengthens the Group’s
market position in Oceania, which in 2000
accounted for less than 1% of total sales, with
an operation that comprises mainly floor-care
products and outdoor products. Email gives
the Group in-house production capacity in the
region. Synergy effects are expected mainly in
sales, administration and purchasing, as well as
through product sourcing.
FLOOR-CARE PRODUCTS
Demand for floor-care products rose for the
full year in both Europe and the US. Both
markets showed slower growth during the
second half of the year, however.The increase
in demand referred mainly to the low end of
the market.
The Group achieved good sales growth in
both the European and the American markets.
Higher volume and greater efficiency contrib-
uted to a considerable improvement in oper-
ating income.
Provision in the fourth quarter
A provision of approximately SEK 200m was
made in the fourth quarter for consolidation of
production in Europe. Production at the plant
in Rothenburg, Germany is being reviewed.
OUTDOOR PRODUCTS
Demand for garden products in Europe was
somewhat higher than in 1999.The Group
achieved good sales growth. Operating in-
come for the European operation showed a
marked improvement, although from a low
level in the previous year.
In the US, demand increased for gas-driven
trimmers and light-duty chainsaws, while mar-
ket volume declined for products such as elec-
tric trimmers, lawn mowers and tractors.The
Group reported good sales growth in most
product areas and a considerable improvement
in operating income.
22 ELECTROLUX ANNUAL REPORT 2000
Business area Consumer Durables
This hedge trimmer is part of the Group’s range
of McCulloch-branded garden equipment for the
European market.
Electrolux is the largest producer of lawn and garden
products in the US.
WhirlWind vacuum cleaners from the Group’s Eureka
subsidiary are the best-selling bagless cleaners in
the US.
Purchase price AUD 485 million (approx. SEK 2,500m)1)
Net sales AUD 919 million (approx. SEK 4,700m)2)
Operating income AUD 55 million (approx. SEK 280m)2)
Number of employees 4,800
Product range Refrigerators, freezers, cookers, dishwashers, washing machines, dryers, etc.
Brands Westinghouse, Kelvinator, Hoover3), Simpson, Chef, Dishlex.
Westinghouse and Kelvinator account for about 50% of sales.
Market share Almost 60% in Australia and 28% in New Zealand.
For more information, visit www.email.com.au
1) May be adjusted with reference to the value of net assets on the closing date.
2) Refers to the fiscal year ending March 31, 2000.
3) Under license agreement.
Data on the Email operation