Electrolux swings to profit, warns on supply chain

PUBLISHED: Tue, 20 Jul 2021 06:48:16 GMT

* April-June operating profit 1.98 bln SEK vs year-ago loss

* Expects demand to start normalising in second half (Adds detail)

STOCKHOLM, July 20 (Reuters) – Electrolux, Europe’s biggest home appliances maker, on Tuesday reported a lower-than-expected second-quarter operating profit and warned global supply chain woes would worsen in coming months.

The Swedish company posted an operating profit of 1.98 billion crowns ($227.6 million) versus a loss of 62 million a year earlier on sales up 39% sales though irregular component deliveries capped production.

That fell short of the 2.13 billion expected by analysts polled by Refinitiv.

“Strong demand together with global supply shortages, especially of electronic components, continued to be successfully addressed,” CEO Jonas Samuelson said in a statement.

“However, production efficiency and demand mix matching were negatively impacted by irregular deliveries.”

The company said a global supply chain squeeze seen in the first half would have an even bigger impact in the second half of the year.

It repeated that it expects demand to start normalising in the second half, albeit with significant regional variances driven by pandemic developments and government stimulus programmes.

Electrolux late on Monday said it was raising its dividend policy to around 50% of annual income from at least 30% and proposed to distribute 17 crowns per share this year through a share redemption.

It also said it planned to buy back more shares over time.

($1 = 8.6991 Swedish crowns) (Reporting by Anna Ringstrom; editing by Niklas Pollard)

(c) Copyright Thomson Reuters 2021. Click For Restrictions – https://agency.reuters.com/en/copyright.html

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