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Electrolux sees profits tumble after failed GE merger

Xinhua, January 29, 2016 Adjust font size:

Swedish appliances giant Electrolux saw its net annual profits plunge 30 percent year-on-year as figures posted on Thursday laid out the damage done by the company's failed merger with General Electric (GE).

Electrolux's net annual sales increased by 10 percent in 2015 compared to the year before to 124 billion SEK (14.6 billion U.S. dollars), but profits for the year were down to 1.57 billion SEK.

"Our operations in North America continued to recover strongly in the quarter. Positive volume growth in most categories and an improved mix contributed to results," outgoing Electrolux CEO Keith McLoughlin said in a statement.

The Swedish company's plans to advance in the U.S. market by acquiring GE's appliance division fell through in December after the U.S. Department of Justice said the merger would reduce competition and result in higher prices for consumers.

"Although we are disappointed that the acquisition is not being completed, we are confident that Electrolux has strong capabilities to continue to grow and develop the position as a leading, global appliance manufacturer," McLoughlin said.

The company's operating income dropped by 23 percent year-on-year to reach 2.7 billion SEK for 2015 as a whole.

The company said demand for appliances increased by 3 percent in Europe during the fourth quarter, excluding Russia. Demand in Eastern European markets dropped by 24 percent "impacted by a continued negative trend in Russia and the Ukraine," it added. (1 U.S. dollar = 8.50 SEK) Endit