Strong growth in the second quarter for Electrolux

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Jonas Samuelson, Electrolux’s President and CEO

Electrolux registered strong a growth in the second quarter of 2021 as Jonas Samuelson, President and CEO of the company, explains. “In the second quarter – he said – we continued to benefit from a favorable market, strong price momentum and demand for our innovative products. Operating income amounted to SEK 1,983m, corresponding to a margin of 6.5%, and organic sales growth was 39.1%. A year ago, restrictions relating to the coronavirus pandemic resulted in significant volume drops, which we partly mitigated through temporary cost actions. Compared to second quarter of 2019, organic sales growth was 16.4%. Strong demand together with global supply shortages, especially of electronic components, continued to be successfully addressed through my colleagues’ hard work and tight collaboration with our suppliers. However, production efficiency and demand mix matching were negatively impacted by irregular deliveries. The market for electronic components is expected to be somewhat more constrained in the third quarter and, hence, we anticipate challenges to fully meet the market’s product mix requirements. We continue to have a close dialogue with our suppliers to mitigate these supply challenges as we expect the situation to remain uncertain for an extended period of time. We continue to fully offset the headwind from external factors, electronic components and logistics through price and we expect that to be the case for the full year as well. We have announced and started implementing additional price increases, taking effect gradually throughout the rest of the year. This as costs for raw materials, electronic components and logistics are increasing further, resulting in increased pressure on cost efficiency and external cost factors. We maintain our 2021 full year regional market outlook, even though visibility remains limited due to the ongoing pandemic. Market demand is expected to begin to normalize during the second half of 2021, but with significant regional variances driven by pandemic developments and impacts from stimulus programs. The global supply challenges experienced in the first half are expected to have a higher impact in the second half of the year. With improved profitability and high capital efficiency, Electrolux financial position and balance sheet are very strong. The significant reengineering and product innovation programs are progressing well. I am therefore pleased that the Board has decided that we can combine continued ambitious growth investments with increased distribution of the value created to our shareholders”.