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Husqvarna net sales down, CEO says they delivered good performance

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Christian Fernsby ▼ | July 16, 2019
Husqvarna presented its interim report for January to June 2019.
Kai Wärn, President and CEO
Husqvarna   All divisions improved operating income
Kai Wärn, President and CEO: "We delivered a good performance during the second quarter.

"All divisions improved operating income, which for the Group increased 10% to SEK 2,125m (1,925).

"Restructuring activities and efficiency improvements, as well as price increases were executed.

"Cost increases from tariffs and raw materials were balanced positive currency effects.

"The improved operating result was despite a slow start of the lawn and garden season.

"Net sales for the Group decreased 7% in the second quarter, adjusted for changes in exchange rates, whereof 4 percentage points were related to the exit of the Consumer Brands business.

"The strong first quarter with high sell-in volumes followed a slow start of the lawn and garden sell-out season in the second quarter resulted in lower net sales within the Husqvarna Division.

"However, operating income for the division increased 5%, driven price increases as well as continued efficiency and restructuring savings.

"The Gardena Division had yet another solid quarter as retailers have been conscious to fully stock-up after the strong and extended season of last year.

"Operating income developed well due to strong product mix as well as efficiency and restructuring savings, and exceeded last year's high reference.

"The Construction Division delivered growth in the quarter, driven a continued strong development in Europe.

"This growth combined with efficiency savings and price increases supported an increased operating income.

"Since we initiated our restructuring measures last year and increased our focus on the profitable growth divisions, we have made significant progress.

"Our last 12 month operating margin amounts to 8.9%, increasing from 7.9% as at the end of 2018, excluding items affecting comparability.

"Operating cash flow in the first half year improved to SEK 2,519m (733), driven higher operating income and positive changes from operating working capital compared to last year.

"To continue to execute on our profitability improvement trajectory, whilst investing in strategic growth initiatives, remains our top priority for 2019.

"We will continue to build on our strengths in prioritized customer segments and product categories."