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Electrolux Profits Slump After Controversial Year Locally

As the local Electrolux Home Products business tries to get back to business as normal, following the controversial exit of former CEO John Featherstone and former human resources director, Deb Bowden earlier this year, Swedish parent Company Electrolux has reported a 49% fall in profits in the third quarter.

The Swedish appliance Companies third-quarter operating profit tumbled 49% to US $191 million as sales shrank 3%.

Former CEO John Featherstone right has removed all reference to his time at Electrolux from his LinkedIn profile. Deb Bowden seen left. 

Price hikes did not fully offset higher costs for ocean freight and electronic components.

Recently newly appointed Electrolux Home Products managing director in Australia, Kurt Hegvold who is only being exposed to ‘tame media ‘following the exit of several senior executives in controversial circumstances, following allegations of “bullying’ by management at the Australian operation, is now looking to jack up prices in an effort to increase profits in Australia.

He said recently “In order to support our brands and people we will need to consider pricing action in the range of 4% to 8% on key parts of our portfolio in the foreseeable future. The exact categories and brands remain an ongoing area of assessment,”.

Hegvold was parachuted into the role after Former CEO John Featherstone claims that he resigned, others in the Company claim that he “was given no option but to resign” after the business descended into a sea of controversy.

According to sources several staff were upset at the axing by Featherstone of former sales director Michael Doyle who was highly respected by major retailers.

Now it’s all about price rises and consolidation “Over the past 12 months Electrolux has worked hard to manage our cost base in the face of some material external challenges. We are experiencing the acceleration of several conspiring market conditions that are materially and negatively impacting our profit and loss (P&L) health. These include but are not limited to cost inflation on steel, resin, components, freight and more recently the weaker Australian dollar.” claims Hegvold.

There was no mention of the parent Company haemorrhaging profits.

Electrolux has warned that the business is set to struggle to meet demand through the rest of the year and into 2022 due to global supply-chain challenges, after its profit slumped in the third quarter as component shortages held back production.

Retailers are being told that there will be limited availability of Electrolux brands for some time.

“We continue to have a tight collaboration with suppliers to mitigate global supply shortages, but we estimate that the fourth quarter will be even more challenging than the third quarter,” archival Whirlpool said recently.

“Although we anticipate sequential improvements in 2022, we expect challenging conditions to remain in meeting continued strong demand.”

In the third quarter, Electrolux’ US and Asia Pacific business, which ships some ready assembled products from China, was particularly affected due to congestion at ports, he said.

Electrolux shares, which have bounced from a nine-month low of 178.84 set in early October, were down 1.6% at 193.95 crowns by 1035 GMT.

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