The Swedish group said on Friday that it was implementing a restructuring program eliminating 4,000 jobs after disappointing results in the third quarter.
The Swedish appliance group Electrolux announced Friday that its restructuring program would affect up to 4,000 jobs worldwide, mainly in North America, after the announcement of very significant losses in the third quarter. “The majority of targeted cost reductions will be achieved in the North America business area“, Electrolux said in a statement, adding that “3,500 to 4,000 positions (would) be affected», i.e. nearly 8% of the group’s 52,000 jobs worldwide.
Weighed down by its departure from Russia, falling demand and supply problems, the Swedish household appliance group Electrolux, which suffered very significant losses in the third quarter, plans up to 4,000 layoffs, according to its financial report published on Friday. With net losses of 605 million crowns (55.3 million euros) but a slight increase in turnover to 35.24 billion crowns (plus 1.2% over one year), thanks to the increase in prices, the group detailed its cost reduction program announced in September. This program, which mainly concerns North America, where it suffered a loss of 1.2 billion crowns during the last quarter, should lead to a restructuring charge of up to 1.5 billion crowns in the fourth trimester. “The majority of targeted cost reductions will be achieved in the North America business area“, Electrolux said in a statement, adding that “3,500 to 4,000 jobs (would) be affected», i.e. nearly 8% of the group’s 52,000 jobs worldwide.
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Worse than expected results
In addition to the 350 million kroner provision for the final Russian withdrawal following the war in Ukraine, Electrolux suffered from a weak market environment and supply chain imbalances which led to a significant increase costs, mainly in North America. “The impact of slowing consumer demand was amplified by high retail inventory levels“, noted the CEO of the group Jonas Samuelson, who expects a still weak demand for 2023. The results presented are worse than expected by analysts. For the June-September period, they were counting on losses of between 14 and 30.5 million crowns and a turnover of between 32.52 and 32.71 billion. On the Stockholm Stock Exchange, the title took 1.98% in a market down slightly (-1.03%) shortly after 10:00 a.m. (08:00 GMT).