Electrolux AB Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Uma Samlin - Bank of America Merrill Lynch - Analyst : Hi, good morning everyone. Thank you so much for taking my question. So my first question is on your plan savings. So you have guided, so SEK4 billion for the year, which will imply, I guess, a higher saving in Q4 to about SEK2 billion. So can you give us a bit more color on the saving plans? How do you plan to achieve that? And how should we think about your savings into 2025 as well? Thank you.

Question: Uma Samlin - Bank of America Merrill Lynch - Analyst : Thank you very much. Just a follow up on that. So I remember you said that you had around 20% sourcing from Asia previously. Do you have any target on how much sourcing do you plan to have from Asia going forward?

Question: Gustav Hagues - SEB - Analyst : Thanks for taking my questions, or question, that is. I have a question on the competitive environment in the US down from Asia that you speak of in the report. Can you get some more clarity on -- you referenced that refrigerators are particularly tough, but is this more towards the low end of the market still, or do you feel that the competition is also quite well spread in the upper parts of the Frigidaire gallery, and so forth? And do you see any trends? You say that promotional activity is flattish, but do you see any pressure down or that prices are actually coming up into Q4?

Question: Bjorn Enarson - Danske Bank - Analyst : Hello, maybe you can help me a little bit. Looking at your savings program, you have your target of SEK4 billion and that's a quite strong incremental development from Q3 going into Q4. Is it possible to give some indication? I mean, you are stressing the FX situation in Q4. That is a negative but looking at the volume price mix et cetera, do you see that this going in stabilizing or is that going in a very different direction from what we have seen so far? Thank you.

Question: Bjorn Enarson - Danske Bank - Analyst : I think it was good, very good. So basically what you have been talking about all year is quite material sequential improvement throughout the year and that goes as it is, as I read it also into Q4?

Question: James Moore - Redburn Atlantic - Analyst : Yes, morning everybody. Morning, Jonas. I've got a couple, if I could. One was on external practice and pricing. I wonder if you could, I guess you won't want to put a number on it at this stage, but given current spot prices and exchange rates, how we should think about material costs and currency and price in 2025. And the other one, if I could tack it on, was on trade policy, given the election coming up. In the instance that Trump is the next president, I wondered if you could help us think about your US revenue and how much is made up of stuff coming out of Mexico versus Asia in terms of source, just to remind us of the exposures.

Question: Mads Lindergaard Rosendal - Danske Bank - Analyst : Good morning. Thank you for taking my question. So my question pertains to your credit rating. Today you announced that you will not be selling Zanussi. I think the rating agencies have modeled in that you will do SEK10 billion in divestments. So how do you intend to make up for this gap? And what other things can you do to preserve your credit rating and also just give some thoughts on how important your credit rating is to you and how far are we willing to go to, to preserve it?

Question: Martin Wilkie - Citigroup - Analyst : Yes, thank you. Good morning. It's Martin from Citi. The question I had was on promotional activity. In the past, it was often very much focused on the fourth quarter, but I think that over time the promotional activity has been spread around a bit more, so it's no longer just simply Black Friday and Cyber Monday and these kind of things. When do you begin to get a sense of how promotion activity is going in the fourth quarter? And is it REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 7:00AM, ELUXb.ST - Q3 2024 Electrolux AB Earnings Call something that we think this is going to be a typical year for Q4 or any other effects we should think about in terms of how we might see that impacting pricing in the fourth quarter?

Question: Martin Wilkie - Citigroup - Analyst : Great, thank you. That's very helpful. And if I'm actually allowed to ask a second question just on Europe, so profitability came in better than expected and it sounds like some of that was mixed. I don't know how much of that was this, you know, more emphasis on the Electrolux brand, less on things like Zanussi and therefore it's sort of a permanent step-up in terms of the mix effect or was there sort of temporary effect there for some particular new models being launched, things like that. How should we think about the durability of that better mix in Europe?

Question: Johan Eliason - Kepler Cheuvreux - Analyst : This is Johan from Kepler Cheuvreux. I think you're doing a great job in Europe and Latin America. But obviously, North America remains an issue. Do you think with the current actions you have implemented there and are on track to implement, that you can actually regain profitability without the help of, let's call it, well-designed import tariffs?

Question: Johan Eliason - Kepler Cheuvreux - Analyst : But I think your market share in North America was 10% last year. It's half of where it was a decade ago. How has the market share development look like so far this year?

Question: Johan Eliason - Kepler Cheuvreux - Analyst : Okay. And good luck with your next endeavors, Jonas.

Question: Uma Samlin - Bank of America Merrill Lynch - Analyst : So I just wanted to have a bit more color on the Springfield ramp-up. You mentioned that the productivity has been gradually improving. But how should we think about that impact in relation to your margins in Q4 and perhaps in 2025? And when do we expect the ramp-up to complete?

Question: James Moore - Redburn Atlantic - Analyst : Yes. I just got one, if I could. The headcount reduction that you're doing, and you mentioned some of that takes time. Is it possible just to quantify what percentage of the current plan is done in terms of headcount to the end of -- and what's still to come?

Question: James Moore - Redburn Atlantic - Analyst : Well, okay. And if I could say thanks a lot for all you help over the last 20 years, and best of luck to the team.