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In view of weaker market conditions and the negative trend for the Group’s income, we decided to speed up actions to cut costs and improve productivity.
These changes refer mainly to the operations in components and major appliances, and include plant shutdowns, write-downs of assets, and rationalization of sales organizations and administration.
Provisions in 2001 totaled SEK 3,261m. Savings are estimated at approximately SEK 856m in 2002, SEK 1,390m in 2003, and SEK 1,425m annually from 2004 onward. The announced actions involve personnel cutbacks of about 5,000.
| Provisions in 2001 |
Provision, |
Personnel |
Estimated savings, |
SEKm |
 |
||||
| Major appliances, Europe | 997 | 1,434 | 206 | 552 |
| Floor-care products, Europe | 19 | 30 | 9 | 17 |
| Garden equipment, Europe | 157 | 185 | 51 | 96 |
| Major appliances, North America | 114 | 325 | 157 | 210 |
| Major appliances, Rest of the world |
40 | 738 | 38 | 47 |
|
|
||||
| Total Consumer Durables | 1,327 | 2,712 | 461 | 922 |
| Food-service equipment | 168 | 353 | 89 | 89 |
| Components | 1,710 | 1,841 | 273 | 343 |
| Other | 56 | 31 | 33 | 36 |
|
|
||||
| Total | 3,261 | 4,937 | 856 | 1,390 |
 In 2001, the trading price of Electrolux B-shares rose by 28%, as against a decline of 17% in the Stockholm All Share Index (SAX). The MSCI Europe Index for European stock exchanges declined by 18% and the S&P 500 in the US fell by 13%. |
 By year-end 2001, the Group had repurchased almost 10% of the total number of Electrolux shares, in accordance with the mandate from the AGM. At the AGM in 2002 the Board proposes cancellation of the shares not required for fulfilling obligations under the option programs. The Board also proposes authorization of a new program for share buy-backs, maximized to 10% of the total number of shares. |
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