Electrolux 2000 Annual Report Download - page 27

ELECTROLUX ANNUAL REPORT 2000 25
INDOOR
• Weaker demand in most product
areas
• Continued structural changes
and divestments in food-service
equipment and laundry equipment
• Improved operating income
for food-service equipment
and leisure appliances
• Lower income for laundry
equipment and components
OUTDOOR
• Higher demand for chainsaws
• Good growth in sales and
operating income for Husqvarna
operation
• Acquisition of US companies
in turf-care equipment and
diamond tools
The Group’s operation in Professional Indoor
Products comprises food-service equipment
for hotels, restaurants and institutions, as
well as laundry equipment for apartment-
house laundry rooms, launderettes, hotels
and other professional users. It also includes
the Group’s operation in components, i.e.
compressors and motors, as well as absorp-
tion refrigerators and other equipment for
recreational vehicles.
MARKET POSITION
Electrolux is the world’s second largest pro-
ducer of food-service equipment and is the
European market leader.The Group is also a
leader in the global market for laundry equip-
ment, and is the world’s largest producer of
compressors and absorption refrigerators.
OPERATIONS IN 2000
Demand for food-service equipment was
somewhat weaker than in 1999, although
the market increased somewhat in the fourth
quarter. Group sales declined slightly in this
product area, mainly as a result of divestments.
Lower deliveries and an increased focus on
more profitable market segments also contrib-
uted to the decline in sales. Operating income
and margin improved over 1999.The perfor-
mance of this product line was influenced by
on-going restructuring, including divestment
of non-core businesses with low profitability.
Laundry equipment reported a decrease in
sales from the previous year as a result of
lower volumes in Western Europe and Japan.
The launch of a new product range involved
production problems and delayed deliveries.
Operating income declined substantially from
the high level of 1999. Income was also ad-
versely affected by lower results for the oper-
ation in heavy-duty equipment, which was
divested in October.
Demand for absorption refrigerators and
other equipment for the recreational vehicle
industry rose for the full year in both Europe
and the US. Leisure appliancies showed good
growth in sales and improved operating in-
come.The newly acquired Seitz operation
contributed to the positive trends for sales
and income.
Demand for compressors and motors rose
during the first two quarters, but slackened
during the second half of the year. Sales for
the component product line were largely un-
changed in comparison with 1999. Operating
income showed a marked decrease as a result
of lower volumes and downward pressure
on prices for compressors, as well as negative
results in the Group’s joint ventures for com-
pressors in China and Egypt.
ACQUISITIONS AND DIVESTMENTS
As of January 1, 2000 the Group acquired
Seitz, a German producer of windows and
other equipment for recreational vehicles
with annual sales of approximately SEK 450m
and 350 employees.The company has two
production units, one in Germany and one
in Sweden.The acquisition enables the Group
to offer a complete range of components and
products to manufacturers of recreational
vehicles.
The major part of the operation in profes-
sional refrigeration equipment was divested as
of January 31, 2000.The remaining operations
were divested later in the year. In 1999 this
operation had sales of approximately SEK
2,300m and 2,000 employees.
As of October 1, 2000 the Group divested
an American operation in heavy-duty laundry
equipment with annual sales of approximately
SEK 300m and 160 employees.A Danish oper-
ation in mixers for restaurants and professional
kitchens with annual sales of approximately
SEK 80m and 80 employees was divested as
of June 1.
Business area Professional Indoor Products
Electrolux is the world leader in refrigerators and
other equipment for recreational vehicles.
In 2000, Electrolux Wascator launched a new prod-
uct range featuring modular design that enables
products to be more closely configured for the
customer’s individual requirements.
In food-service equipment, Electrolux is the European
leader and the world’s second largest producer.