STOCKHOLM, Feb. 4, 2020 /PRNewswire/ --
Kai Wärn, President and CEO:
"The seasonally small fourth quarter was characterized by a mixed market development. In Europe, sales developed positively, whereas in the US, sales were negatively impacted by trade partners continuing to reduce their inventories. In total, net sales decreased by 2% adjusted for currency effects and the exited Consumer Brands business. Operating income in the fourth quarter amounted to SEK -310m (-282), excluding items affecting comparability. The result was primarily impacted by significantly decreased manufacturing levels, which resulted in under absorption, as well as negative product mix effects. However, partly compensated by a net positive impact from an asset sale and write downs.
For the full-year 2019 Group net sales increased by 1%, adjusted for changes in exchange rates and the exited Consumer Brands business. Despite the challenging lawn and garden season during 2019, operating income increased by 21% or by SEK 674m to SEK 3,915m (3,241), representing an operating margin of 9.3% (7.9), excluding items affecting comparability. Direct operating cash flow improved to SEK 3,849m (1,336), driven by higher operating income and positive changes in working capital. The Board of Directors will propose a dividend for 2019 of SEK 2.25 (2.25) to the AGM.
Several important strategic steps were taken during 2019 supporting our journey of sustainable profitable growth. We presented an updated strategy building on a sharper focus on our end-customer segments and robotics and battery solutions, strengthening our winning core and growing our services and solutions business. We are proud to drive technology development exemplified by the introduction of the new Husqvarna EPOS technology to the market, providing robotic lawnmowing with virtual boundary technology.
For 2020, the top priority is to continue the trajectory towards sustainable profitable growth whilst finalizing exits of Consumer Brands business (SEK 2.2bn). We will drive strategic initiatives in all our divisions, enabled both through cost reductions from our efficiency measures and the restructuring activities announced in November 2019. The seasonal order situation and readiness are in line with the plans for the year. Based on the current status of information, we do not foresee any significant business disturbances related to the Corona virus outbreak, if component supply is normalized during next few weeks, whereas it might become material if they remain in March. In January, the Board of Directors appointed Henric Andersson as President and CEO, starting in April, 2020. I am pleased to hand over to Henric who has deep knowledge and experience of the business".
Fourth quarter 2019
- Net sales decreased 1% to SEK 6,408m (6,470), or decreased 5% if adjusted for changes in exchange rates. Net sales decreased by 2% when adjusted for exit of Consumer Brands business and changes in exchange rates.
- Operating income amounted to SEK -493m (-1,104) including items affecting comparability related to the additional restructuring announced in November 2019 of SEK -183m (-822). Excluding items affecting comparability the operating income amounted to SEK -310m (-282), which includes a net positive impact, from the sale of an asset and asset write downs, of approximately SEK 100m.
- Earnings per share after dilution amounted to SEK -0.67 (-1.61).
January - December 2019
- Net sales amounted to SEK 42,277m (41,085), corresponding to a currency adjusted decrease of 2%. Net sales increased by 1% when adjusted for exit of Consumer Brands business and changes in exchange rates.
- Operating income amounted to SEK 3,690m (2,070) including items affecting comparability related to restructuring expenses of SEK -225m (-1,171). Excluding items affecting comparability the operating income amounted to SEK 3,915m (3,241), which includes a net positive impact, from the sale of an asset and asset write downs, of approximately SEK 60m (55).
- Earnings per share after dilution amounted to SEK 4.42 (2.12).
- Direct operating cash flow increased to SEK 3,849m (1,336).
- The Board of Directors will propose a dividend for 2019 of SEK 2.25 per share (2.25) to the AGM.
A combined press and telephone conference, hosted by Kai Wärn, President and CEO, and Glen Instone, CFO, will be held at Husqvarna Group's office, Regeringsgatan 28, Stockholm at 10:00 CET on February 4, 2020. To participate, please dial +46 (0) 8 566 184 30 (Sweden) or +44 (0) 8 448 228 902 (UK) ten minutes prior to the start of the conference. Conference ID: Husqvarna or 4553429#. The conference call will also be audio cast live on www.husqvarnagroup.com/ir. A replay will be available later the same day.
- Glen Instone, CFO, Senior Vice President, Finance, IR & Communication, +46 72 716 5032
- Johan Andersson, Director, Group Corporate Communications and Investor Relations, +46 702 100 451
This press release contains insider information that Husqvarna AB is required to disclose under the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the contact person set out above, at 08.00 CET on February 4, 2020.
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The following files are available for download:
Interim report Q4 2019 Husqvarna Group (PDF)
SOURCE Husqvarna AB