By Helena Soderpalm
STOCKHOLM -Electrolux said on Friday global supply chain issues would persist after posting a drop in quarterly profit, while expecting demand in 2022 above pre-pandemic levels.
Households have been spending more on their homes, including on appliances, during the pandemic. But global logistics constraints and shortages of electronic components have hit Electrolux’s production.
Electrolux said the issues would continue to impact the industry’s ability to fully meet demand, while it expected prices to offset strong cost inflation in 2022, mainly in raw materials, electronic components and logistics.
“We estimate that the first quarter will be at least as challenging as the fourth quarter 2021,” the Swedish company said in a statement, adding it expected sequential improvements from mid-2022.
Shares in Europe’s biggest home appliances maker, down 14% so far this year through Thursday, fell 5.4% in early trade.
Kepler Cheuvreux said the “reasonably good” result was already evident from rival Whirlpool’s report earlier this week.
“The share is reacting on the weak guidance on Q1 as well as guidance on the very significant cost inflation for 2022E well above Whirlpool’s guidance,” said analyst Johan Eliason.
Electrolux had previously warned that global supply chain constraints would be challenging in the fourth quarter and into this year.
Fourth-quarter operating profit fell to 882 million Swedish crowns ($94.1 million) from a year-ago 2.50 billion, including costs of 727 million relating to arbitration in a U.S. tariff case.
Electrolux proposed a dividend of 9.20 crowns per share, up from 8.00 crowns the previous year, and announced a new share buyback programme of 2.5 billion crowns.
($1 = 9.3736 Swedish crowns)