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Annual Report 2016 Report by the Board of Directors Notes Proposed distribution of earnings Auditors' report Eleven-year review Review by business area

Other facts

Management changes in 2016 and 2017

Jonas Samuelson was appointed new President and CEO of Electrolux as of February 1, 2016. He succeeded Keith McLoughlin who retired from the company. Jonas ­Samuelson was previously Head of the business area Major Appliances EMEA. He has been with Electrolux since 2008.

Daniel Arler succeeded Jonas Samuelson as Head of Major Appliances EMEA. Daniel Adler was previously Senior Vice President of the Kitchen product line within EMEA. He has been with Electrolux since 2002.

Alan Shaw is new head of Major Appliances North ­America. He succeeded Keith McLoughlin who was acting interim Head of the business area. Alan Shaw’s most recent position was President of Husqvarna AB’s Consumer Brands division.

Ola Nilsson is new Head of Small Appliances. Ola ­Nilsson succeeded Henrik Bergström. Ola Nilsson was ­previously Senior Vice President, Product Line Laundry Major Appliances EMEA. He has been with Electrolux since 1994.

Anna Ohlsson-Leijon is new Chief Financial Officer. She succeeded Tomas Eliasson who left the Group. Anna Ohlsson-Leijon was previously CFO of the business area Major Appliances EMEA. She has been with Electrolux since 2001.

Mikael Östman has been appointed General Counsel as of January 1, 2017. He succeeded Cecilia Vieweg who retired from the Group. Mikael Östman was previously Head of Electrolux Corporate Legal Department. He has been with Electrolux since 2002.

Ricardo Cons is new Head of Major Appliances Latin Americas since February 2017. He succeeded Ruy Hirschheimer who left the Group on October 1, 2016 and has been interim head of the business area since the same date. Ricardo Cons most recent position was with Franke in Brazil.

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, 2016, the Group had a total of 3,233 (3,259) cases pending, representing approximately 3,296 (approximately 3,326) plaintiffs. During 2016, 1,300 new cases with 1,300 plaintiffs were filed and 1,326 pending cases with approximately 1,330 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

Material profit or loss items in operating income

Over the years, Electrolux has implemented restructuring programs for the purpose of optimizing its manufacturing footprint and reducing costs to improve competitiveness. Restructuring charges related to these programs have been presented separately as items affecting comparability in the income statement. Operating income by business area and selected key ratios have been reported excluding these costs.

These major restructuring programs have come to an end and Electrolux has since 2015 discontinued this accounting practice. For comparability purposes, the financial statements for 2014 have been restated to include restructuring costs. Although there will likely be restructuring programs going forward, these are expected to be much less extensive.

Figures for 2012–2015 in this report are including re­­structuring costs, see specification below.

Material profit or loss items in operating income1)

SEKm 2012 2013 2014 2015 2016
Major Appliances          
EMEA –927 –828 –1,212
North America –105 –392) 1582)
Latin America –10
Asia/Pacific –351 –10
Small Appliances –82 –1903)
Professional Products
Other –1,214 –772) –1,9012)
Total Group –1,032 –2,475 –1,348 –2,249

1) Restructuring costs have prior to 2015 been reported as items affecting comparability and not included in operating income by business area and selective key ratios.

2) Refers to costs related to the not completed acquisition of GE Appliances. Costs for preparatory integration work of SEK 39m for 2014 and SEK 158m for 2015 have been charged to operating income for Major Appliances North America. Common Group cost includes transaction costs of SEK 110m for 2014 and SEK 408m for 2015 and a termination fee paid to General Electric in December 2015 of USD 175m, corresponding to SEK 1,493m. In total, costs of SEK 2,059m related to GE Appliances were charged to operating income in 2015, of which SEK 63m in the first quarter, SEK 195m in the second quarter, SEK 142m in the third quarter and SEK 1,659m in the fourth quarter.

3) Refers to the program to restore profitability in Small Appliances.