- Net sales for 2010 increased by 1.5% in comparable currencies.
- Strong growth in Asia/Pacific and Latin America offset lower sales volumes in Europe and North America.
- Operating income increased to SEK 5,430m (3,761).
- Electrolux achieved its operating margin target of 6%, excluding items affecting comparability.
- Operating income improved on the basis of an improved product mix and cost savings.
- Income for the period was SEK 3,997m (2.607).
- Earnings per share amounted to SEK 14.04 (9.18).
Net sales
Net sales for the Electrolux Group in 2010 amounted to SEK 106,326m, as against SEK 109,132m in the previous year. Changes in exchange rates had a negative impact on net sales. Net sales increased by 1.5% in comparable currencies. Strong sales growth in Latin America and Asia/Pacific offset lower sales volumes in Europe and North America.
| Change in net sales | |
| % | 2010 |
| Changes in Group structure | 0.0 |
| Changes in exchange rates | –4.1 |
| Changes in volume/price/mix | 1.5 |
| Total | –2.6 |
Operating income
Operating income for 2010 increased to SEK 5,430m (3,761), corresponding to 5.1% (3.4) of net sales.
All operations showed improvements. Improvements in mix, cost savings and changes in exchange rates had a positive impact on income, compared to 2009.
Items affecting comparability
Operating income for 2010 includes costs for the restructuring program initiated in 2004, see page 8. These costs, amounting to SEK –1,064m
Depreciation and amortization
Depreciation and amortization in 2010 amounted to SEK 3,328m (3,442).
Financial net
Net financial items improved to SEK –124m (–277). The improvement is mainly due to lower interest rates on borrowings and lower net borrowings.
Income after financial items
Income after financial items increased to SEK 5,306m (3,484), corresponding to 5.0% (3.2) of net sales.
Taxes
Total taxes in 2010 amounted to SEK –1,309m (–877), corresponding to 24.7% (25.2) of income after financial items.
Income for the period and earnings per share
Income for the period amounted to SEK 3,997m (2,607), corresponding to SEK 14.04 (9.18) in earnings per share before dilution.
Effects of changes in exchange rates
Changes in exchange rates compared to the previous year, including translation, transaction effects and hedging contracts, had a positive impact of approximately SEK 660m on operating income for 2010. The effects of changes in exchange rates referred mainly to the operations in Europe, Asia/Pacific and Latin America. The weakening of the euro against several other currencies and the strengthening of the Australian dollar and the Brazilian real against the US dollar positively affected operating income.
The transaction effects amounted to approximately SEK 740m and the translation of income statements in subsidiaries to approximately
For additional information on effects of changes in exchange rates, see section on foreign exchange risk in Note 2.
Market overview
Demand in the North American market increased by 5% over the previous year. The growth derives from a very low level after more than three years of decline. One contributing factor to the growth in 2010 was the state-sponsored rebate program for energy-efficient products in the second quarter.
Total demand in the European market stabilized in 2010 and increased by 2%, after more than two years of decline, primarily due to growth in Eastern Europe, where demand increased by 6%. Demand in Western Europe stabilized. The market in Brazil increased in 2010 in comparison with the previous year. Most other markets in Latin America also improved.
Market demand for appliances in Europe and North America is expected to show a modest growth in 2011. Demand in Europe is expected to increase by approximately 2% and demand in North America by approximately 3% in 2011.