Advance warning of poor third quarter

Husqvarna has warned its third-quarter core operating profit would halve due to unfavourable weather, restructuring costs and rising trade tariffs.

The outdoor power tools manufacturer said in July that it would restructure its Consumer Brands division partly due to weak demand in the United States. “In addition to the restructuring, the third quarter has also been impacted by the extended warm and dry weather” the company has said.

In the year-ago quarter, operating profit excluding one-off items was 433 million crowns ($48.7 million).

Husqvarna said the profit drop came mainly on the back of a “negative product- and regional mix for its core Husqvarna division as warm and dry weather in Europe hit demand”. It said both Husqvarna and Consumer Brands, including petrol lawnmowers and garden tractors, also had higher costs for raw materials and new tariffs.

“For 2019 the expectation is that these will be mitigated by price increases,” it added.

Husqvarna said that the restructuring it plans to carry out this year and next would cost an estimated total 1.2 billion crowns ($135 million) before tax, and predicted annual savings from the restructuring of around 250 million crowns with full effect from 2020.

Husqvarna is due to publish its full third-quarter report on Oct. 19

Leave a comment

You are commenting as guest.