Annual Report 2009 - Husqvarna Group

Report by the Board of Directors Husqvarna Annual Report 2009 35
Consumer Products
• Considerably lower demand in both Europe and North
America.
• Slightly higher sales and improved income for the North
American operation.
• Substantial downturn in overall operating income, mainly
due to lower volumes and a less favorable mix.
Consumer Products
SEKm 2009 2008 Change, %
Adjusted
change, % 2
Net sales 22,672 19,849 14 –3
Operating
income 1 719 1,043 –31 –24
Operating
margin, % 1 3.2 5.3 — —
1) Excluding restructuring costs.
2) Excluding acquisitions and adjusted for changes in exchange rates.
Industry shipments in 2009 declined considerably in both
Europe and North American. Shipments in North America
declined for the fifth consecutive year.
Group sales rose in SEK, but declined by 3% after adjustment
for changes in exchange rates and acquisitions.
Sales in North America rose slightly in local currency. The
increase refers to wheeled products such as lawn mowers and
garden tractors. Sales of chainsaws and other handheld products
declined in comparison with 2008, when demand was
positively affected by storms. The Group increased its market
share in several product categories, partly as a result of new
listings.
Sales outside North America increased slightly in SEK, but
declined after adjustment for changes in exchange rates and
acquisitions. The decline refers in particular to chainsaws and
other handheld products in the dealer channel, and in Russia
and Eastern Europe. Sales of Gardena-branded products rose
slightly, resulting mainly from expansion of the product range
with new lawn mowers and chainsaws.
Operating income and margin for this business area
declined sharply. The decline refers to the operation outside
North America, and resulted mainly from a less favorable mix
in terms of products and geographical markets, as well as
lower volumes. Income and margin for the North American
operation improved from the previous year. Price increases,
savings from implemented cost-cutting measures and lower
costs for materials had a positive effect on income.
Professional Products
• Lower demand and sales in all product areas, largest
downturn for Construction.
• Substantial decline in operating income, but margin
remained at a high level.
• Margin for Forestry improved from the previous year.
Professional Products
SEKm 2009 2008 Change, %
Adjusted
change, % 2
Net sales 11,402 12,493 –9 –17
Operating
income 1 1,457 1,822 –20 –26
Operating
margin, % 1 12.8 14.6 — —
1) Excluding restructuring costs.
2) Excluding acquisitions and adjusted for changes in exchange rates.
Demand in 2009 was substantially lower than in the previous
year. Group sales declined by 17%, after adjustment for
changes in exchange rates and acquisitions. Lower sales were
reported for all product areas, with the largest downturn for
Construction. Sales for Forestry showed substantial decline in
volume in significant markets such as Russia, the US and Eastern
Europe.
Operating income for this business area declined considerably.
Operating margin remained at a high level, however. The
decline in income refers mainly to lower sales and production
volumes, while savings from implemented cost-cutting measures
and the weaker Swedish krona made positive contributions.
The largest downturn in income was reported for Construction,
as a result of the dramatic drop in demand, and
income for this product area was negative. Operating margin
for Forestry improved, mainly as a result of rationalization of
chainsaw production and a large share of new products.
Net debt/equity and equity/
assets ratios
Maturity profile of loans
Times
2.0
%
40
SEKm
3,000
2,500
1.6
1.2
0.8
0.4
0
05 06 07 08 09
32
24
16
Net debt/equity ratio, times
Equity/assets ratio, %
8
0
2,000
1,500
1,000
500
0
10 11 12 13 14 15–
Bond loans
Bank and other loans
Husqvarna has un-utilized
committed revolving credit
facilities totaling SEK 10,000m.