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CEO Comment

Interim Report Q1 2024Alberto-Zanata-portrait-jpg

Comparable profit increased”

During the first quarter, Food & Beverage drove the improvement in comparable profitability, despite a weaker organic sales development.

Organically, sales declined by 4.3% compared to the strong sales of last year. In total, sales grew by 2.9% including the acquisition of TOSEI. EBITA amounted to SEK 326m (340) including integration related costs for TOSEI of SEK 38m, resulting in an EBITA margin of 10.7% (11.4). Excluding integration related costs, the comparable EBITA would have been SEK 364m, and the EBITA margin 11.9%.

Sales of Food & Beverage declined organically by 3.1% compared to last year. EBITA improved, resulting in a EBITA margin of 10.9% (9.6). EBITA includes integration related costs of SEK 11m. Excluding integration costs, the comparable margin would have been 11.4%. Sales in our largest market, Europe remained unchanged, while the US declined by 9% and APAC-MEA by 2%. We continue to see signs of recovery in the US. Order intake was higher than a year ago in both North America and Europe.

Sales of Laundry declined organically by 5.9% compared to the strong sales in last year’s corresponding quarter. The EBITA margin ended at 13.7% (18.1). The margin decline is due to lower volumes, partly due to delayed deliveries, and SEK 26m for integration related cost for TOSEI. Excluding integration costs, the comparable margin would have been 15.9%. Order intake was significantly higher than a year ago.

The integration of TOSEI, which was acquired on January 10, 2024, is progressing in line with plan. TOSEI added sales of SEK 240m in the quarter. Sales declined compared to last year driven by a weak laundry market development. However, comparable profitability (excluding integration related costs) is accretive to the Group margin.

Operating cash flow after investments improved and amounted to SEK 183m (87). During the quarter, we acquired TOSEI for SEK 1,620m. In March we launched a medium-term note programme in Sweden with a framework of SEK 5bn, and issued our first bonds in an amount of SEK 900m. The market response was very positive.

Related to sustainability, Electrolux Professional Group once again demonstrated industry leadership. We have retained our B-rating in the Carbon Disclosure Program (CDP), received a low risk ESG-rating in Sustainalytics, and earned the Ecovadis Silver rating (Top 15%), allowing us to be considered as a preferred supplier. In addition, CO2 emissions from our operations have decreased by 17% compared to last year.

Our ambition is to improve our margin by cost efficiency, mix, volume, and realizing synergies from acquisitions. The improved comparable profit demonstrates that the quarter was another step in the right direction.”

Alberto Zanata, President and CEO