STOCKHOLM (dpa-AFX) - Electrolux AB (ELUXY.PK), a Swedish home appliance major, reported that its third quarter net loss was 235 million Swedish kronor or 0.87 kronor per share compared to net income of 123 million kronor or 0.45 kronor per share in the same quarter last year.
Operating income for the third quarter dropped to 349 million kronor from 608 million kronor in the prior year. The latest quarter results included a previously announced non-recurring item of -368 million kronor related to the divestment of the water heater business in South Africa. Excluding non-recurring items, operating income rose to 717 million kronor from 314 million kronor in the prior year.
Net sales for the third quarter declined to 33.29 billion kronor from 33.43 billion kronor in the prior year. But organic sales increased by 6.2% driven by strong growth in Latin America and higher sales in Europe, Asia-Pacific, Middle East and Africa, supported by the innovative and attractive product offering.
Earnings contribution from cost efficiency in the third quarter reached 1.2 billion kronor, and the target of around 4 billion kronor in cost savings for full year 2024 remains.
Currency headwinds have intensified throughout 2024, and combined with a decrease in raw material costs during the fourth quarter of 2023, the company anticipates that external factors will have a negative impact in the fourth quarter of 2024. For the full year 2024, the company has adjusted its outlook for the impact of external factors on operating income from positive to neutral.
During the preparation phase, the company determined that the value of the Zanussi brand would be more effectively monetized through the Group's licensing business, so it is not being divested at this time. As a result, the total potential divestment value is now expected to be below the previously communicated 10 billion kronor. The company anticipates the closing of the divestment of the water heater business in South Africa in the fourth quarter of 2024.
The company said it has successfully implemented a substantial re-engineering investment program aimed at enhancing modularization, automation, and resource efficiency. The company anticipates cumulative cost reductions of nearly 9 billion kronor over 2023-24.
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