Electrolux 2008 Annual Report Download - page 50

annual report 2008 | part 1 | financial review in brief
Net sales and operating margin Net sales and employees
Financial review
2008 in brief
Operating income decreased
Operating income for 2008 decreased to SEK 1,188m (4,475).
Operating income was strongly affected by the sharp decline in
demand by the end of the year and the cost-reduction measures
that were introduced to reduce the number of employees. The
launch of Electrolux as a major appliances brand in North America
and other non-recurring items also affected the results, see table
below. Operating income for appliances in Europe and North
America deteriorated significantly while operating income for the
other operations showed improvements. Operations in Latin-
amerika and Professional Products showed record results and
the profitability for floor-care products and appliances in Asia/
Pacific improved.
Impact of cost-reduction measures,
the Electrolux US launch and non-recurring items
SEKm, approximately 2008
Cost-reduction measures due to sharp decline in demand –1,045
Net impact of the Electrolux launch, appliances North America –470
Cost-cutting program, appliances Europe –360
Cost for a component problem for dishwashers,
appliances Europe –120
Capital gain, real estate, appliances Europe 130
Cost for litigation, appliances North America –80
Total –1,945
Items affecting comparability
In addition to the items described above, operating income in
2008 includes costs for plant closures related to the restructuring
program initiated in 2004. These costs, amounting to SEK –355m
(–362), are reported as items affecting comparability within oper-
ating income. Excluding items affecting comparability, operating
income amounted to SEK 1,543m (4,837).
Key data
SEKm 2008 Change 2007
Net sales 104,792 0% 104,732
Operating income 1,18 8 –73% 4,475
Margin, % 1.1 4.3
Income after financial items 653 –84% 4,035
Income for the period 366 –87% 2,925
Earnings per share, SEK1) 1.29 10.41
Dividend per share, SEK 02) 4.25
Cash flow from operations and
investments 1,194 –6% 1,277
Average number of employees 55,177 –1,721 56,898
Excluding items
affecting comparability
Items affecting comparability –355 –2% –362
Operating income 1,543 –68% 4,837
Margin, % 1.5 4.6
Income after financial items 1,008 –77% 4,397
Income for the period 656 –80% 3,276
Earnings per share, SEK1) 2.32 11.66
1) Basic.
2) The Board of Directors proposes that no dividend will be paid for 2008.
Downturn in the market
Most of Electrolux main markets for appliances showed a decline in
2008. The North American market declined by 10% and the Euro-
pean market by 4%.
Sales in line with the previous year
Net sales for the Electrolux Group in 2008 was in line with the pre-
vious year and amounted to SEK 104,792m. This corresponded to
a decline by 0.9% in comparable currencies.
Net sales
Operating margin, excluding
items affecting comparability
125,000 10
8
6
4
2
0
100,000
75,000
50,000
25,000
004 05 06 07 08
SEKm %
Net sales in 2008
decreased by 0.9% in
comparable curren-
cies. Operating margin
was adversely effected
by a sharp decline in
demand and non-
recurring items.
10 largest countries SEKm Employees
USA 28,610 10,046
Brazil 8,416 6,773
Germany 7,392 2,141
Italy 4,979 7,515
France 4,942 1,386
Australia 4,462 1,756
Canada 4,427 1,352
UK 3,782 891
Sweden 3,559 2,865
Spain 2,718 838
Other 31,505 19,615
Total 104,792 55,177
This is a short description of Electrolux financial performance in 2008. For a thorough review of
the 2008 results, see Board of Directors Report on page 5 in part 2, of the Annual Report.
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