Other facts
Pension agreement in the US
In the fourth quarter of 2013, Electrolux made an agreement with pension plan participants in the US to accept a lump-sum payment of SEK 880m in total in lieu of accrued pension rights and thereby leave the plan. This has reduced Electrolux defined benefit obligation by SEK 1,020m. The difference between the agreed payment and the obligation led to an accounting gain of approximately SEK 140m, which has been reported within operating income. This had no impact on the cash flow.
Changes in Group Management
Chief Design Officer Stefano Marzano, member of Group Management, left his position at year-end 2013. The new head of design will report to Chief Technology Officer Jan Brockmann in Group Management.
Asbestos litigation in the US
Litigation and claims related to asbestos are pending against the Group in the US. Almost all of the cases refer to externally supplied components used in industrial products manufactured by discontinued operations prior to the early 1970s. The cases involve plaintiffs who have made substantially identical allegations against other defendants who are not part of the Electrolux Group.
As of December 31, 2013, the Group had a total of 2,980 (2,864) cases pending, representing approximately 3,040 (approximately 2,936) plaintiffs. During 2013, 1,057 new cases with 1,048 plaintiffs were filed and 941 pending cases with approximately 944 plaintiffs were resolved.
The Group continues to operate under a 2007 agreement with certain insurance carriers who have agreed to reimburse the Group for a portion of its costs relating to certain asbestos lawsuits. The agreement is subject to termination upon 60 days notice and if terminated, the parties would be restored to their rights and obligations under the affected insurance policies.
It is expected that additional lawsuits will be filed against Electrolux. It is not possible to predict the number of future lawsuits. In addition, the outcome of asbestos lawsuits is difficult to predict and Electrolux cannot provide any assurances that the resolution of these types of lawsuits will not have a material adverse effect on its business or on results of operations in the future.
For information on certain additional legal proceedings, see Note 25 Contingent liabilities.Environmental activities
At the end of 2013, Electrolux operated 57 manufacturing facilities in 19 countries. Manufacturing comprises mainly assembly of components made by suppliers. Other processes include metalworking, molding of plastics, painting and enameling.
Chemicals such as lubricants and cleaning fluids are used as process aids. Chemicals used in Group products include insulation materials, paint and enamel. Production processes generate an environmental impact through the use of energy and water, as well as water- and air-borne emissions, waste and noise.
Studies of the total environmental impact of the Group’s products during their entire lifetime, i.e., from production and use to recycling, indicate that the greatest environmental impact is generated when the products are used. Electrolux aims to develop and actively promote increased sales of products with lower environmental impact.
Mandatory permits and notification in Sweden and elsewhere
Electrolux operates three plants in Sweden, which account for approximately 2% of the total value of the Group’s production. Permits are required by authorities for two of these plants and are also required to submit notification. The permits cover such areas as thresholds or maximum permissible values for air- and- water-borne emissions and noise. No significant non-compliance with Swedish environmental legislation was reported in 2013.
Manufacturing units in other countries adjust their operations, apply for necessary permits and report to the authorities in accordance with local legislation. The Group follows a precautionary principle with reference to both acquisitions of new plants and continuous operations. Potential non-compliance, disputes or items that pose a material financial risk are reported to Group level in accordance with Group policy. No such significant item was reported in 2013.
Electrolux products are affected by legislation in various markets, principally involving energy consumption, producer responsibility for recycling, and restriction and management of hazardous substances. Electrolux continuously monitors changes in legislation, and both product development and manufacturing are adjusted to reflect these changes.
StopSearchHereCEO Statement
In 2013 we continued to deliver above our growth target and delivered 4.5% in organic sales growth.
CEO Statement
I'm convinced that raising product efficiency for the growing middle class is where long-term shareholder value creation lies.
Our products
Electrolux is the only appliance manufacturer in the industry to offer complete solutions for both consumers and professionals. The focus is on innovative and energy-efficient products in the premium segments.
Sustainability
Achieving the Group's vision of sustainability leadership is crucial to realizing the business strategy. The objective is to develop smarter, more accessible, resource-efficient solutions that meet people's needs and improve their lives. Read the comprehensive sustainability performance review.
Awards & recognition
Financial Reporting
Net sales for the Electrolux Group in 2013 amounted to SEK 109,151m, as against SEK 109,994m in the previous year. The organic sales growth was 4.5%, while currencies had an impact of -5.3%.
