© Reuters. FILE PHOTO: The Electrolux brand is seen in the course of the IFA Electronics present in Berlin, Germany September 4, 2014. REUTERS/Hannibal Hanschke/File Picture
STOCKHOLM (Reuters) -Electrolux, the world’s second-biggest home equipment maker, mentioned on Friday that its fourth-quarter loss had widened from a yr earlier as a result of excessive prices, intensified worth competitors and weak demand in North America, sending its shares decrease.
The Swedish group, which is because of publish its full quarterly earnings report on Feb. 2, estimated an working lack of round 3.2 billion crowns ($311 million) for the three months, towards a year-earlier 2.0 billion loss, on roughly unchanged gross sales.
The consequence consists of non-recurring gadgets of a internet unfavorable 2.5 billion crowns, primarily restructuring prices which Electrolux in October estimated at 2 billion-2.5 billion crowns.
Electrolux mentioned its North America division, which accounts for round a 3rd of group gross sales, noticed underlying losses develop to 1.4 billion crowns within the fourth quarter from 1.2 billion a yr earlier.
“The primary driver behind the loss in North America was intensified worth strain and weak demand throughout Black Friday, in addition to the rest of the yr,” it mentioned in a press release.
Electrolux, whose merchandise occupy the premium finish of the market in lots of areas, mentioned market costs had fallen specifically for fridges and freezers, one among its key classes in North America.
The group has struggled to compete with lower-end rivals comparable to China’s Midea. Alongside market chief Whirlpool (NYSE:), it’s below strain to decrease costs as cash-strapped customers go for cheaper items.
Prices for a brand new U.S. range manufacturing facility, and the switch of manufacturing to it from one other manufacturing facility, additionally weighed on ends in North America.
Group revenue can also be negatively affected by a 1.2 billion crown writedown associated to U.S. tax credit, Electrolux added.
Shares within the firm closed 5% decrease, taking a year-to-date drop to 9%.
($1 = 10.2290 Swedish crowns)