Electrolux Net Falls 64 Percent in Fourth Quarter
STOCKHOLM-Fourth-quarter net income for Electrolux took a 64 percent dive to $34 million, as the company continued to struggle in a weak and highly competitive appliance market worldwide.
Net sales for the final quarter of its fiscal year (using the average value of the U.S. dollar versus the Swedish krona for 2011 and 2010) increased 14 percent to $4.4 billion. However, the company saw its gross margin slashed by 355 basis points to 18.2 percent, driven downward by higher raw-materials costs. Operating expenses increased by 7 percent in dollar terms and 61 basis points as a percentage of sales, to 16.1 percent.
For the fiscal year as a whole, Electrolux's bottom line plummeted 43 percent to $317.9 million, despite a net sales gain of 5.9 percent to $15.6 billion.
Keith McLoughlin, president and CEO, said, "The headwinds of price pressure, higher raw-material costs and weak demand grew stronger as the year progressed." McLoughlin added that Electrolux is taking action to "increase prices, take out costs, acquire companies in emerging markets and change the organization to strengthen the company's position as we enter 2012."