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European weakness weighs on Electrolux’s Q2

Updated at: 07/19/2013 1:35 PM
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(AP) STOCKHOLM - Home appliance maker Electrolux reported Friday an 8 percent fall in second-quarter earnings amid continued economic weakness in Europe and unfavorable currency fluctuations.

The Stockholm-based company said its earnings for the period amounted to 642 million kronor ($98 million), while quarterly sales were flat year-on-year at 26.7 billion kronor ($4 billion), the company said.

Overall, organic sales grew nearly 6 percent during the quarter, led by strong performances in North and South America.

In Brazil, the company did particularly well amid high demand for air conditioners and washing machines. Despite reporting an 18 percent increase in Latin American sales, negative currency swings harmed the company.

In North America, which accounts for 30 percent of Electrolux’s total sales, demand for core appliances rose 9 percent in the second quarter.

Particularly disappointing for the company was the weakness in Europe _ a core market for the world’s second largest manufacturer of household appliances _ where prices and sales were under pressure.

Net sales for Europe, the Mideast and Africa, which comprise nearly 30 percent of total sales, fell over 2 percent in the quarter to 8 billion kronor ($1.2 billion).

But the company believes a turnaround in Europe.

"Looking ahead to next year and beyond, we expect demand in Europe to rebound and...earnings to recover," CEO Keith McLoughlin said.

Electrolux employs 61,000 people worldwide.

(Copyright 2013 by The Associated Press. All Rights Reserved.)