Electrolux report for the first nine months of 2000

REPORT FOR THE FIRST NINE MONTHS OF 2000 - Net income per share rose by 19% - Amounts in SEKm, Nine months Third quarter unless otherwise stated 1 1 20001999 Change 20001999 Chang ) ) e Net sales 95,07 91,144 4% 29,64429,070 2% 2 Operating income 6,333 5,346 18% 1,830 1,539 19% Margin, % 6.7 5.9 6.2 5.3 Income after 5,575 4,573 22% 1,504 1,354 11% financial items Margin, % 5.9 5.0 5.1 4.7 Net income per share, 10.20 8.55 19% 2.85 2.80 2% 2) SEK 3) Value creation 2,137 1,220 917 406 380 26 Return on equity, % 19.2 17.0 1) Figures for 1999 include items affecting comparability in the amount of SEK -216m, se page 2. 2) Based on average no. of shares for the period after buy-backs. 3) See definition on page 4. * Growth in demand in Europe and US slowed in the third quarter * Higher income for both Consumer Durables and Professional Products * Good performance in North America for Indoor as well as Outdoor products * Lower income for Consumer Durables in Europe in third quarter * Value created increased by SEK 917m over last year Net sales and income Net sales for Electrolux in the first nine months of 2000 amounted to SEK 95,072m, as against SEK 91,144m last year. This corresponds to an increase of 4.3%, of which -3.5% refers to changes in the Group's structure, +2.4% to changes in exchange rates, and +5.4% to price/mix/volume. Operating income increased by 18% to SEK 6,333m (5,346), corresponding to 6.7% (5.9) of sales, and income after financial items rose by 22% to 5,575m (4,573), corresponding to 5.9% (5.0) of sales. Net income increased by 19% to SEK 3,716m (3,124), which corresponds to SEK 10.20 (8.55) per share. The above income figures for 1999 include items affecting comparability in the amount of SEK -216m, comprising a provision of USD 225m (SEK 1,841m) for pension litigation in the US in the third quarter and a capital gain of approximately SEK 1,625m in the same quarter on the divestment of an operation in Professional Products. Excluding these items in 1999, operating income increased by 14%, income after financial items by 16% and net income by 18%. Changes in exchange rates during the period, i.e. in terms of both transactions and translations, had a net positive effect of approximately SEK 475m on income after financial items. This effect is traceable largely to the strengthening of the dollar and the British pound. The weakening of the euro also had a positive impact in view of the Group's large production base within the EU. In geographical terms, operating income increased in North America. An improvement was also achieved in Asia. The comparative figures for last year include subsequently divested operations, net of acquisitions, that contributed approximately SEK 3,200m in net sales and approximately SEK 80m in operating income. Third quarter Sales in the third quarter of 2000 rose to SEK 29,644m, as against SEK 29,070m during the same period last year. This corresponds to an increase of 2%, of which -3.8% refers to changes in the Group's structure, +5.6% to changes in exchange rates, and +0.2% to price/mix/volume. Operating income rose by 19% to SEK 1,830m (1,539), corresponding to 6.2% (5.3) of sales, and income after financial items increased by 11% to SEK 1,504m (1,354), which corresponds to 5.1% (4.7) of sales. Net income amounted to SEK 1,018m (1,024), corresponding to SEK 2.85 (2.80) per share. The figures for 1999 include items affecting comparability in the amount of SEK -216m, as described above. Excluding these items operating income increased by 4% and income after financial items declined by 4%. Net financial items declined in comparison with the third quarter of 1999, when an exceptionally strong trading result was reported. Higher interest rates also had a negative impact. Cash flow The cash flow after dividends and adjusted for exchange-rate effects amounted to SEK -963m (4,548). The decline is traceable mainly to an increase in working capital, which is in line with the growth of sales, as well as lower proceeds on divestments and repurchase of shares. The improvement in income made a positive contribution. (See page 9). Equity and net debt/equity ratio Equity as of September 30, 2000 increased to SEK 26,348m (24,769), corresponding to SEK 75.20 (67.60) per share. The return on equity was 19.2% (17.0), and the return on net assets was 21.8% (17.9). Excluding items affecting comparability, the return on equity was 19.2% (17.2) and the return on net assets was 21.1% (18.2). Average net assets for the period, adjusted for items affecting comparability, amounted to SEK 39,963m (40,674). Net borrowings amounted to SEK 16,587m (13,152). The net debt/equity ratio increased to 0.61 (0.51). Liquid funds at the end of the period amounted to SEK 10,854m (11,731). Parent company, AB Electrolux Net sales for the parent company for the first nine months of 2000 amounted to SEK 5,346m (4,794). Income after financial items was SEK 6,122m (1,524), including dividends from subsidiaries in the amount of SEK 6,364m (1,978). Capital expenditure was SEK 123m (230 ). Liquid funds at the end of the period amounted to SEK 3,661m (3,608) as against SEK 3,731m at the start of the year. The parent company's share of the surplus pension funds distributed by the Swedish insurance company SPP amounts to SEK 264m. The refund has not been included in the accounts for the first nine months of 2000. (See also page 7). President and CEO ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2000/10/27/20001027BIT01060/bit0001.doc The full report http://www.bit.se/bitonline/2000/10/27/20001027BIT01060/bit0002.pdf The full report

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