Electrolux — Interim / Quarterly Report 2013

Oct 25, 2013

Interim Report January – September 2013

Stockholm, October 25, 2013

Highlights of the third quarter of 2013	Read more
• Net sales amounted to SEK 27,258m (27,171) and income for the period was SEK 656m (923), or SEK 2.29 (3.22) per share.	2
• Organic sales growth was 4.9%, while currencies had a negative impact of –4.6%.	2
• Continued organic sales growth in all regions, except for Major Appliances Europe, Middle East and Africa.	4
• North America continued to show strong organic growth of 8% and reached an operating margin of 7% as a result of increased volumes and improved mix.	4
• Continued weak markets and lower volumes impacted results negatively in Europe.	4
• Strong performance for Professional Products.	6
• Negative impact from currencies of SEK –519m affected earnings in Latin America, Asia/Pacific and Europe.	3
• Initiated actions to reduce annual costs by SEK 1.8bn by improving manufacturing footprint and reducing overhead costs, mainly within Major Appliances Europe.	8

Financial overview

SEKm1)	Nine months 2012	Nine months 2013	Change, %	Q3 2012	Q3 2013	Change, %
Net sales	80,809	80,260	–1	27,171	27,258	0
Organic growth, %	4.6	4.9		4.6	4.9
Operating income	3,442	2,832	–18	1,423	1,075	–24
Margin, %	4.3	3.5		5.2	3.9
Income after financial items	2,792	2,308	–17	1,170	884	–24
Income for the period	2,123	1,720	–19	923	656	–29
Earnings per share, SEK2)	7.42	6.01		3.22	2.29
Operating cash flow3)	3,333	567	–83	–230	907	494

1) Key ratios are excluding items affecting comparability. There were no items affecting comparability in the third quarters of 2013 and 2012. Items affecting comparability amounted to SEK –82m (0) for the first nine months of 2013, see page 11. Items affecting comparability includes costs for restructuring programs to make the Group's production competitive in the long term.

2) Basic, based on an average of 286.2 (286.1) million shares for the third quarter of 2013, excluding shares held by Electrolux.

3) Excluding financial items paid, taxes paid and acquisitions and divestments of operations.

For earnings per share after dilution, see page 11. For definitions, see page 21.

For further information, please contact Investor Relations and Financial Information, at +46 8 738 60 03.

About Electrolux

Electrolux is a global leader in household appliances and appliances for professional use, selling more than 50 million products to customers in more than 150 markets every year. The company makes thoughtfully designed, innovative solutions based on extensive consumer research, meeting the desires of today's consumers and professionals. Electrolux products include refrigerators, dishwashers, washing machines, cookers, air-conditioners and small appliances such as vacuum cleaners, all sold under esteemed brands like Electrolux, AEG, Zanussi and Frigidaire. In 2012, Electrolux had sales of SEK 110 billion and about 61,000 employees. For more information go to http://group.electrolux.com/.

Market overview

In the third quarter of 2013, demand in North America and emerging markets showed good growth. Demand in several of Electrolux core markets in Europe continued to decline.

Demand in Western Europe declined by 1%, while demand in North America increased by 12%. Market demand in Australia is estimated to have increased.

Market demand in Eastern Europe increased by 1% and demand in Southeast Asia continued to show growth.

The third quarter in summary*

SEKm	Nine months 2012	Nine months 2013	Change %	Q3 2012	Q3 2013	Change, %
Net sales	80,809	80,260	–0.7	27,171	27,258	0.3
Change in net sales, %, whereof
Organic growth	—	—	4.9	—	—	4.9
Changes in exchange rates	—	—	–5.6	—	—	–4.6
Operating income
Major Appliances Europe, Middle East and
Africa	770	120	–84	294	111	–62
Major Appliances North America	1,115	1,683	51	496	563	14
Major Appliances Latin America	933	755	–19	339	243	–28
Major Appliances Asia/Pacific	535	371	–31	208	117	–44
Small Appliances	242	164	–32	124	97	–22
Professional Products	433	338	–22	149	167	12
Other, common Group costs, etc.	–586	–599	–2	–187	–223	–19
Operating income, excluding items
affecting comparability	3,442	2,832	–18	1,423	1,075	–24
Margin, %	4.3	3.5	—	5.2	3.9	—
Items affecting comparability	—	–82	—	—	—	—
Operating income	3,442	2,750	–20	1,423	1,075	–24
Margin, %	4.3	3.4		5.2	3.9

* All comments are excluding items affecting comparability. For items affecting comparability, see page 11.

• Organic growth of 4.9%.
• Continued organic sales growth in all regions except for Major Appliances Europe, Middle East and Africa.
• Strong performance for the North American operations.
• Lower volumes in core markets, price pressure and unfavorable currency movements impacted the European results.
• Negative impact from currency movements affected earnings across all business areas, particularly in emerging markets.

Net sales for the Electrolux Group increased by 0.3% in the third quarter of 2013. Organic growth was 4.9%, while changes in exchange rates had a negative impact of –4.6%. The organic sales growth was mainly attributable to the operations in North America, Asia/Pacific, Professional Products and Small Appliances.

Operating income declined to SEK 1,075m (1,423), corresponding to a margin of 3.9% (5.2).

The North American operations continued to show a positive earnings trend. Mix improvements as well as higher sales volumes of core appliances contributed to the positive performance. In

Electrolux applies the amended standard for pension accounting, IAS 19 Employee Benefits, as of January 1, 2013. Reported figures for 2012 have been restated to enable comparison. The impact on Electrolux financial statements for 2012 was released in March 2013, see page 10 and http://www.electrolux.com/ias19/.

Europe, lower sales volumes and price pressure in several of the Group's core markets had an adverse effect on operating income. Unfavorable currency movements had a negative impact on operating income for the operations in emerging markets and in Europe. Increased investments and marketing spend related to new product launches particularly in Asia/Pacific also impacted earnings in the quarter.

Effects of changes in exchange rates

Changes in exchange rates had a negative impact of SEK –519m on operating income year-over-year in the quarter. The impact of transaction effects was SEK –538m, results from hedging operations SEK 90m and translation effects SEK –71m. The strengthening of the US dollar against the Brazilian real and several other currencies in Latin America and Asia/Pacific had an adverse impact on operating income. The strengthening of the euro against several other currencies impacted results negatively in Europe.

Financial net

Net financial items for the third quarter of 2013 improved to SEK –191m (–253).

Income for the period

Income for the period amounted to SEK 656m (923), corresponding to SEK 2.29 (3.22) in earnings per share, see page 11.

First nine months of 2013 excluding items affecting comparability

Net sales for the Electrolux Group in the first nine months of 2013 amounted to SEK 80,260m (80,809). Net sales declined by 0.7%. Organic growth was 4.9%, while changes in exchange rates had a negative impact of –5.6%.

Operating income declined to SEK 2,832m (3,442), corresponding to a margin of 3.5% (4.3). Income after financial items amounted to SEK 2,308m (2,792). Income for the period was SEK 1,720m (2,123), corresponding to SEK 6.01 (7.42) in earnings per share.

Events during the third quarter of 2013

July 23. Electrolux appoints new Head of Investor Relations

Electrolux has appointed Catarina Ihre as Vice President and Head of Investor Relations as from latest January 2014. She succeeds Peter Nyquist who has taken up a position outside of the company.

September 16. Electrolux ranked Household Durables Industry Leader in the Dow Jones Sustainability World Index Electrolux has been included in the prestigious Dow Jones Sustainability World Index (DJSI World) for 2013, maintaining its position as Industry Leader in the Household Durables category for the seventh consecutive year.

September 24. Nomination Committee appointed for Electrolux AGM 2014

The members of the Nomination Committee have been appointed based on the ownership structure as of August 31, 2013, read more on page 9.

Business areas

Major Appliances Europe, Middle East and Africa

Industry shipments of core appliances in Europe,

		Nine months	Nine months
units, year-over-year, %	Full year 2012	2012	2013	Q3 2012	Q3 2013
Western Europe	–2	–2	–1	–2	–1
Eastern Europe (excluding Turkey)	3	4	2	2	1
Total Europe	–1	–1	–1	–1	–1

Net sales	34,278	25,062	24,155	8,581	8,520
Organic growth, %	–0.9	–0.6	–0.6	–3.5	–0.3
Operating income	1,105	770	120	294	111
Operating margin, %	3.2	3.1	0.5	3.4	1.3

In the third quarter of 2013, the overall market for core appliances in Europe declined year-over-year. Demand in Western Europe was slightly negative, declining by 1% compared with the preceding year. Demand increased in the Nordic countries and Germany, but remained weak in Southern Europe, Benelux and France. Demand in Eastern Europe rose by 1%, driven mainly by growth in Russia, while demand declined throughout the rest of Eastern Europe.

Organic sales in Europe were unchanged year-over-year. The product mix improved but this was offset by lower sales volumes and continued price pressure. The launch of high-end appliances across markets in Europe under the Electrolux brand, The Inspiration Range, improved the product mix.

Operating income declined in the third quarter versus last year. Lower sales volumes in several of Electrolux core markets, unfavorable currency movements and price pressure had an adverse impact on operating income for the quarter.

Major Appliances North America

Industry shipments of appliances in the US, units, year-over-year, %	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Core appliances	–2	–3	9	0	12
Microwave ovens and home comfort products	1	–2	–7	4	–6
Total Major Appliances	0	–2	4	1	7

SEKm
Net sales	30,684	23,477	24,291	7,771	8,165
Organic growth, %	6.9	3.9	7.6	6.3	8.0
Operating income	1,452	1,115	1,683	496	563
Operating margin, %	4.7	4.7	6.9	6.4	6.9

In the third quarter of 2013, market demand for core appliances in North America rose by approximately 12% year-over-year. Market demand for major appliances including microwave ovens and home comfort products, such as room air-conditioners, increased by 7% during the quarter. Market growth in the US was to a large extent driven by promotional sales related to the Fourth of July and Labor Day holiday.

In the third quarter, organic sales in North America increased by 8% year-over-year, due to higher volumes of core appliances. The favorable market environment, launches of new products and new distribution channels had a positive impact on sales. Electrolux sales volumes rose in several of the core appliance product categories and the Group continued to capture market shares.

Operating income improved, due to continued volume growth in core appliances and price/mix improvements. The consolidation of production of cooking products to Memphis, Tennessee, USA, from L'Assomption, Quebec, Canada, continued to negatively impact earnings, due to temporarily higher manufacturing costs for operat-

ing two factories simultaneously. Increased sales costs related to growth in new channels and the re-launch of Electrolux-branded products also impacted results for the quarter.

Major Appliances Latin America

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	22,044	15,633	15,056	5,301	4,699
Organic growth, %	20.6	20.4	8.6	24.1	1.6
Operating income	1,590	933	755	339	243
Operating margin, %	7.2	6.0	5.0	6.4	5.2

In the third quarter, market demand for core appliances in Latin America is estimated to have slowed down year-over-year, mainly as a result of lower demand for appliances in Brazil. The conclusion of the government's incentive program for appliances had a negative impact on demand.

In Latin America, the Group's organic growth continued to increase year-over-year, primarily driven by price increases and an improved product mix. A fire in September at Electrolux warehouse for refrigerators and freezers in Curitiba, Brazil, impacted volumes negatively in the quarter. The significance of sales outside Brazil in other Latin American markets is growing and accounted for about 35% of total sales during the quarter.

Operating income declined for the quarter mainly due to the negative impact of currency movements. The Brazilian real and other Latin American currencies weakened versus the US dollar, which affected the overall profit with about SEK –225m. Higher prices and an improved product mix contributed to earnings, while higher costs for sourced products had a negative impact.

Major Appliances Asia/Pacific

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	8,405	6,146	6,496	2,107	2,321
Organic growth, %	2.9	2.6	13.1	3.6	20.2
Operating income	746	535	371	208	117
Operating margin, %	8.9	8.7	5.7	9.9	5.0

In the third quarter of 2013, market demand for major appliances in Australia, Southeast Asia and China is estimated to have grown yearover-year. Electrolux organic sales and market shares in Australia increased during the quarter. Sales in Southeast Asia and China continued to show strong growth.

Operating income declined in the quarter year-over-year, mainly on account of a negative country mix as sales growth in emerging markets demonstrated higher growth than in Australia and New Zealand. The strengthening of the US dollar against the Australian dollar and several other currencies in emerging markets also impacted earnings negatively. Investments related to the new range of products for the Chinese and Southeast Asian markets negatively impacted operating income. The launch, which started in the third quarter of 2013, will continue during the fourth quarter.

Small Appliances

			Nine months
SEKm	Full year 2012	Nine months 2012	2013	Q3 2012	Q3 2013
Net sales	9,011	6,322	6,255	2,112	2,131
Organic growth, %	6.0	5.5	4.3	3.3	5.6
Operating income	461	242	164	124	97
Operating margin, %	5.1	3.8	2.6	5.9	4.6

In the third quarter of 2013, market demand for vacuum cleaners in Europe is estimated to have declined, while demand in North America is estimated to have increased year-over-year.

During the quarter, Electrolux sales grew in all regions due to higher volumes and higher prices and an improved product mix. Sales volumes for vacuum cleaners and small domestic appliances were particularly strong in Asia/Pacific. Higher volumes of cordless, handheld vacuum cleaners in most regions also had a positive impact on sales.

Operating income declined year-over-year, partly as a result of increased costs for sourced products in Europe and Brazil, related to the strengthening of the US dollar against local currencies. A negative country mix and intensified marketing activities for new products in Asia/Pacific and North America also impacted earnings negatively for the quarter. Sales in emerging markets demonstrated higher growth than in mature markets, which had an adverse impact on the country mix.

Professional Products

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	5,571	4,169	4,006	1,299	1,422
Organic growth, %	–3.9	–2.1	–1.3	–4.8	9.7
Operating income	588	433	338	149	167
Operating margin, %	10.6	10.4	8.4	11.5	11.7

In the third quarter, market demand in Southern and Northern Europe, where Electrolux holds a strong position, remained weak and declined year-over-year, while demand in emerging markets and in the US increased somewhat.

Electrolux sales increased strongly year-over-year in the third quarter particularly due to higher volumes. This is a result of the Group's strategic initiatives to grow in new markets and segments. Both sales of professional food-service equipment and sales of professional laundry equipment increased and the Group gained market shares.

Operating income improved year-over-year, primarily as a result of higher sales volumes. Price increases also positively impacted results.

The investment to introduce the ultra luxury product range, Electrolux Grand Cuisine, continued in the quarter.

Cash flow

	Nine months	Nine months
Full year 2012	2012	2013	Q3 2012	Q3 2013
				1,907
				168
–4,538	–3,188	–3,133	–1,228	–1,168
4,779	3,333	567	–230	907
–164	–164	–202	–119	—
–673	–450	–418	–164	–138
–1,564	–1,099	–938	–142	–475
2,378	1,620	–991	–655	294
–1,868	–1,868	–1,860	–8	—
212	212	—	—	—
722	–36	–2,851	–663	294
	7,789 1,528	5,430 1,091	5,212 –1,512	2,180 –1,182

Cash flow from operations and investments in the third quarter of 2013 improved and amounted to SEK 294m (–655). The improvement in the third quarter year-over-year relates mainly to changes in working capital. Cash flow is normally weak in the third quarter, reflecting increased production and build up of inventories for the seasonally stronger fourth quarter.

Payments for the ongoing restructuring and cost-cutting programs amounted to SEK –129m in the quarter.

Investments in the third quarter mainly related to investments within manufacturing facilities for new products. Major projects are the cooker plant in Memphis, Tennessee, in the US and the refrigerator plant in Rayong in Thailand. The cooker plant in Memphis is receiving investment support from state authorities.

Financial position

	Net debt
--	----------

SEKm	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
Borrowings	13,088	14,349	14,182
Liquid funds	7,403	7,816	5,523
Financial net debt	5,685	6,533	8,659
Net provisions for post-employment benefits	4,479	3,937	2,862
Net debt	10,164	10,470	11,521
Net debt/equity ratio	0.65	0.65	0.75
Equity	15,726	16,130	15,279
Equity per share, SEK	54.96	56.37	53.38
Return on equity, %	14.4	16.8	14.4
Equity/assets ratio, %	23.2	23.7	22.2

Net debt increased to SEK 11,521m (10,470). Net debt has been impacted by the negative cash flow from operations and investments in the first quarter of 2013 as well as the dividend payment in the second quarter, although the cash flow has improved during the second and third quarters. During the third quarter of 2013, SEK 553m in short-term borrowings were amortized and long-term borrowings with SEK 1,005m.

Long-term borrowings as of September 30, 2013, including longterm borrowings with maturities within 12 months, amounted to SEK 12,129m with average maturity of 3.5 years, compared to SEK 11,005m and 3.1 years at the end of 2012. During 2013 and 2014, long-term borrowings in the amount of SEK 269m will mature.

Liquid funds as of September 30, 2013, amounted to SEK 5,523m (7,816), excluding short-term back-up facilities. Electrolux has two unused committed back-up facilities. One EUR 500m multi-currency revolving credit facility, approximately SEK 4,400m, maturing

2017 with extension options for one year and a credit facility of SEK 3,400m maturing in 2017.

Net assets and working capital

Average net assets for the period amounted to SEK 27,571m (27,345). Net assets as of September 30, 2013, amounted to SEK 26,800m (26,600). Adjusted for items affecting comparability, i.e., restructuring provisions, average net assets amounted to SEK 29,329m (28,282), corresponding to 27.4% (26.2) of net sales.

Working capital as of September 30, 2013, amounted to SEK –3,894m (–5,576), corresponding to –3.6% (–5.2) of annualized net sales. The return on net assets was 13.3% (16.8), and 12.9% (16.2), excluding items affecting comparability.

Structural changes

Cost reductions of SEK 1.8bn for a charge of SEK 3.4bn to be realized in the Group, mainly within Major Appliances Europe, Middle East and Africa, but also within other business areas and Group Staff. This will be achieved through manufacturing footprint restructuring as well as overhead cost reductions.

Manufacturing footprint

An investigation will be initiated regarding the competitiveness of the entire Italian manufacturing setup for major appliances, which includes all four plants.

The study of the future platform for food preservation products in Asia/Pacific has resulted in the decision to close the factory in Orange, Australia, and to concentrate the production to the plant in Rayong, Thailand. Execution will start in the fourth quarter of 2013.

Overhead cost reduction and ERP impairment

In order to adapt the overhead cost structure to the current market situation in Europe, a cost reduction program will be initiated in the fourth quarter of 2013. This will mainly affect Major Appliances Europe, Middle East and Africa but also Group Staff and other business areas.

In connection with this, the implementation schedule for a new Enterprise Resource Planning (ERP) platform for the Group, developed over the years, will be revised. This may trigger an impairment of parts of the ERP platform with an amount of SEK 1.0bn, no cash effect.

Financial implications

The above mentioned restructuring charges, in total SEK 3.4bn, whereof SEK 2.6bn cash, and the impairment of SEK 1.0bn, will be taken in Q4 2013 and during 2014 as IAC (items affecting comparability), within operating income. The saving of SEK 1.8bn will be in full effect in 2016.

Approximately 2,000 employees are affected by these actions excluding any additional impact of the announced manufacturing investigation in Italy.

Other items

Nomination Committee for Electrolux Annual General Meeting 2014

In accordance with decision by the Annual General Meeting, Electrolux Nomination Committee shall consist of six members. The members should be one representative of each of the four largest shareholders in terms of voting rights that wish to participate in the committee, together with the Chairman of the Electrolux Board and one additional Board member.

The members of the Nomination Committee have been appointed based on the ownership structure as of August 31, 2013. Petra Hedengran, Investor AB, is the Chairman of the committee. The other owner representatives are Kaj Thorén, Alecta, Marianne Nilsson, Swedbank Robur funds, and Johan Sidenmark, AMF. The committee also includes Marcus Wallenberg and Torben Ballegaard Sørensen, Board Chairman and Board member, respectively, of Electrolux.

The Nomination Committee will prepare proposals for the Annual General Meeting in 2014 regarding Chairman of the Annual General Meeting, Board members, Chairman of the Board, remuneration for Board members, Auditor, Auditor's fees and, to the extent deemed necessary, proposal regarding amendments of the current instruction for the Nomination Committee.

Electrolux Annual General Meeting 2014 will be held on March 26 at Stockholm Waterfront Congress Centre, situated at Nils Ericsons Plan 4 in Stockholm, Sweden.

Shareholders who wish to submit proposals to the Nomination Committee should send an email to nominationcommittee@electrolux.com.

Asbestos litigation in the US

Litigation and claims related to asbestos are pending against the Group in the US. Almost all of the cases refer to externally supplied components used in industrial products manufactured by discontinued operations prior to the early 1970s. The cases involve plaintiffs who have made substantially identical allegations against other defendants who are not part of the Electrolux Group.

As of September 30, 2013, the Group had a total of 2,953 (2,915) cases pending, representing approximately 3,013 (approximately 2,987) plaintiffs. During the third quarter of 2013, 263 new cases with 263 plaintiffs were filed and 200 pending cases with approximately 203 plaintiffs were resolved.

It is expected that additional lawsuits will be filed against Electrolux. It is not possible to predict the number of future lawsuits. In addition, the outcome of asbestos lawsuits is difficult to predict and Electrolux cannot provide any assurances that the resolution of these types of lawsuits will not have a material adverse effect on its business or on results of operations in the future.

Risks and uncertainty factors

As an international group with a wide geographic spread, Electrolux is exposed to a number of business and financial risks. The business risks can be divided into strategic, operational and legal risks. The financial risks are related to such factors as exchange rates, interest rates, liquidity, the giving of credit and financial instruments.

Risk management in Electrolux aims to identify, control and reduce risks. This work begins with the description of risks and risk management, see the 2012 Annual Report on page 74. No significant risks other than the risks described there are judged to have occurred.

Risks, risk management and risk exposure are described in more detail in the Annual Report 2012,

www.electrolux.com/annualreport2012.

Press releases 2013

January 31	Electrolux recognized in three prestigious sustainability
	rankings	April 25	Interim report January-March 2013 and CEO
February 1	Consolidated results 2012 and CEO		Keith McLoughlin's comments
	Keith McLoughlin's comments	July 19	Interim report January-June 2013 and CEO
February 15	Notice convening the Annual General Meeting of		Keith McLoughlin's comments
	AB Electrolux	July 23	Electrolux appoints new Head of Investor Relations
February 15	Bert Nordberg proposed as new Board Member of		September 13 Dates for financial reports from Electrolux in 2014
	AB Electrolux		September 16 Electrolux ranked Household Durables Industry Leader
February 22	Electrolux Annual Report 2012 is published		in the Dow Jones Sustainability World Index
March 25	Electrolux restated figures for 2012 following the change		September 24 Nomination committee appointed for Electrolux Annual
	in pension accounting standards		General Meeting 2014
March 26	Electrolux issues bond loan	October 8	Electrolux praised for action and reporting on emissions
March 27	Bulletin from AB Electrolux Annual General Meeting
	2013
April 4	Electrolux Sustainability Report 2012 now available
	online

	Keith McLoughlin's comments
July 19	Interim report January-June 2013 and CEO
	Keith McLoughlin's comments
July 23	Electrolux appoints new Head of Investor Relations
	September 13 Dates for financial reports from Electrolux in 2014
	September 16 Electrolux ranked Household Durables Industry Leader
	in the Dow Jones Sustainability World Index
	September 24 Nomination committee appointed for Electrolux Annual
	General Meeting 2014
October 8	Electrolux praised for action and reporting on emissions

Parent Company AB Electrolux Review report

The Parent Company comprises the functions of the Group's head office, as well as five companies operating on a commission basis for AB Electrolux.

As from 2013, the main financial flows for the business area Major Appliances Europe, Middle East and Africa are included in the Parent Company reporting, which affects the financial statements significantly.

Net sales for the Parent Company, AB Electrolux, for the first nine months of 2013 amounted to SEK 20,957m (4,449) of which SEK 17,079m (2,206) referred to sales to Group companies and SEK 3,878m (2,243) to external customers. Income after financial items was SEK 409m (1,202), including dividends from subsidiaries in the amount of SEK 1,703m (1,163). Income for the period amounted to SEK 443m (1,280). The Parent Company reports group contribution in the income statement as appropriations for the first time in 2013. Corresponding changes have been made in the 2012 financial statements.

Capital expenditure in tangible and intangible assets was SEK 338m (193). Liquid funds at the end of the period amounted to SEK 1,805m, as against SEK 1,986m at the start of the year.

Undistributed earnings in the Parent Company at the end of the period amounted to SEK 13,865m, as against SEK 15,269m at the start of the year. Dividend payment to shareholders for 2012 amounted to SEK 1,860m.

The income statement and balance sheet for the Parent Company are presented on page 19.

We have reviewed this report for the period January 1st to September 30th, 2013 for AB Electrolux (publ). The board of directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.

We conducted our review in accordance with the Swedish Standard on Review Engagements SÖG 2410, Review of Interim Report erformed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent Company.

Stockholm, October 25, 2013 PricewaterhouseCoopers AB

Anders Lundin Authorized Public Accountant Lead partner

Björn Irle Authorized Public Accountant

Stockholm, October 25, 2013

Keith McLoughlin President and CEO

New pension accounting standards as of 2013

Electrolux applies the amended standard for pension accounting, IAS 19 Employee Benefits, as of January 1, 2013. The main change is that the option to use the corridor approach – previously applied by Electrolux – has been removed. Opening balances for 2013 and reported figures for 2012 have been restated to enable comparison. The impact of the restatement on the financial statements, operating income per business area and key ratios of Electrolux for 2012 was presented in a press release on March 25, 2013. An Excel sheet comprising restated figures in more detail including the interim periods is available for download at http:// www.electrolux.com/ias19/.

All historical unrecognized actuarial gains or losses are included in the measurement of the net defined benefit liability. This increases the net pension liability for 2012 by SEK 4,618m and reduces equity by SEK 4,098m. Operating income for 2012 is reduced by SEK 150m, which is a result of interest costs and return on pension liabilities and -assets no longer being reported within operating income and that amortization of the actuarial losses no longer are used. Financing costs for the net pension liability will be reported within the financial net which deteriorates by SEK 174m. Income for the period after tax declines by SEK 234m. The restatement has no impact on the cash flow. A short description of the amended standard is presented below. See also Note 1 in Electrolux Annual Report for 2012, www.electrolux.com/annualreport2012.

The amended standard requires the present value of defined benefit obligations and the fair value of plan assets to be recognized in the financial statements as a net defined benefit liability. Following the amendment, the reported net defined benefit liability will correspond to the actual net obligations for pensions for Electrolux.

As in the past, service costs will be reported within operating income. Electrolux will classify the net pension obligation as a financial liability and report financing costs in the financial net. The discount rate will be used to calculate the financing costs of the net pension obligation. The standard thereby removes the use of an expected return on the plan assets.

Future changes in the net defined benefit liability as a result of, for example, adjustments to discount rates, mortality rates as well as return on plan assets deviating from the discount rate will be presented in other comprehensive income as they occur.

Accounting and valuation principles

Electrolux applies International Financial Reporting Standards (IFRS) as adopted by the European Union. This report has been prepared in accordance with IAS 34, Interim Financial Reporting, and ÅRL, the Swedish Annual Accounts Act and recommendation RFR 2, Accounting for legal entities, issued by the Swedish Financial Reporting Board. There are no changes in the Group's accounting and valuation principles compared with the accounting and valuation principles described in Note 1 of the Annual Report 2012.

Consolidated income statement

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	109,994	80,809	80,260	27,171	27,258
Cost of goods sold	–87,807	–64,837	–64,705	–21,402	–21,974
Gross operating income	22,187	15,972	15,555	5,769	5,284
Selling expenses	–11,673	–8,446	–8,415	–2,799	–2,761
Administrative expenses	–5,541	–4,139	–4,296	–1,544	–1,439
Other operating income/expenses	59	55	–12	–3	–9
Items affecting comparability	–1,032	—	–82	—	—
Operating income	4,000	3,442	2,750	1,423	1,075
Margin, %	3.6	4.3	3.4	5.2	3.9
Financial items, net	–846	–650	–524	–253	–191
Income after financial items	3,154	2,792	2,226	1,170	884
Margin, %	2.9	3.5	2.8	4.3	3.2
Taxes	–789	–669	–567	–247	–228
Income for the period	2,365	2,123	1,659	923	656
Items that will not be reclassified to income for the period:
Remeasurement of provisions for post-employment benefits	–917	–264	1,669	–265	16
Income tax relating to items that will not be reclassified	51	63	–476	52	–66
	–866	–201	1,193	–213	–50
Items that may be reclassified subsequently to income for the period:
Available for sale instruments	23	–9	–68	5	–54
Cash flow hedges	34	–3	–51	—	–133
Exchange-rate differences on translation of foreign operations	–1,532	–1,461	–1,409	–1,531	–1,123
Income tax relating to items that may be reclassified	–2	1	33	—	42
	–1,477	–1,472	–1,495	–1,526	–1,268
Other comprehensive income, net of tax	–2,343	–1,673	–302	–1,739	–1,318
Total comprehensive income for the period	22	450	1,357	–816	–662
Income for the period attributable to:
Equity holders of the Parent Company	2,362	2,121	1,658	921	655
Non-controlling interests	3	2	1	2	1
Total	2,365	2,123	1,659	923	656
Total comprehensive income for the period attributable to:
Equity holders of the Parent Company	26	453	1,360	–811	–659
Non-controlling interests	–4	–3	–3	–5	–3
Total	22	450	1,357	–816	–662
Earnings per share, SEK	8.26	7.42	5.79	3.22	2.29
Diluted, SEK	8.24	7.41	5.77	3.22	2.28
Number of shares after buy-backs,
million	286.1	286.1	286.2	286.1	286.2
Average number of shares after buy-backs, million	285.9	285.8	286.2	286.1	286.2
Diluted, million	286.6	286.5	287.0	287.0	287.0

Items affecting comparability

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Restructuring provisions and write-downs
Consolidation of operations within Small Appliances	—	—	–82	—	—
Major Appliances, Europe, Middle East and Africa, adapting manufacturing
footprint	–927	—	—	—	—
Additional pension costs, appliances plant in L'Assomption, Canada	–105	—	—	—	—
Total	–1,032	—	–82	—	—

Financial data quarterly and yearly can be downloaded and viewed at www.electrolux.com/ir. There is a graph section where you can view trends as well as compare financial items.

Consolidated balance sheet

SEKm	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
Assets
Property, plant and equipment	16,693	16,009	16,672
Goodwill	5,541	5,618	5,006
Other intangible assets	5,079	4,977	5,013
Investments in associates	16	12	220
Deferred tax assets	4,156	3,927	3,890
Financial assets	333	308	275
Pension plan assets	286	376	335
Other non-current assets	481	1,184	697
Total non-current assets	32,585	32,411	32,108
Inventories	12,963	13,899	13,477
Trade receivables	18,288	17,815	18,505
Tax assets	609	486	606
Derivatives	184	237	152
Other current assets	3,607	3,582	4,267
Short-term investments	123	491	156
Cash and cash equivalents	6,835	6,836	4,971
Total current assets	42,609	43,346	42,134
Total assets	75,194	75,757	74,242
Equity attributable to equity holders of the Parent Company Share capital	1,545	1,545	1,545
Other paid-in capital	2,905	2,905	2,905
Other reserves	–1,146	–1,140	–2,635
Retained earnings	12,381	12,787	13,429
Total equity	15,685	16,097	15,244
Non-controlling interests	41	33	35
Total equity	15,726	16,130	15,279
Long-term borrowings	10,005	9,158	11,859
Deferred tax liabilities	1,117	1,089	1,079
Provisions for post-employment benefits	4,765	4,313	3,197
Other provisions	4,551	4,728	3,991
Total non-current liabilities	20,438	19,288	20,126
Accounts payable	20,590	20,191	20,692
Tax liabilities	1,287	1,565	1,239
Short-term liabilities	11,971	11,574	12,346
Short-term borrowings	2,795	4,715	2,036
Derivatives	241	353	280
Other provisions	2,146	1,941	2,244
Total current liabilities	39,030	40,339	38,837
Total equity and liabilities	75,194	75,757	74,242
Contingent liabilities	1,610	1,729	1,619

Change in consolidated equity

SEKm	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
Opening balance	20,644	20,644	15,726
Changes in accounting policy1)	–2,998	–2,998	—
Restated opening balance	17,646	17,646	15,726
Total comprehensive income for the period	22	450	1,357
Share-based payment	–141	–152	58
Sale of shares	212	212	—
Dividend	–1,860	–1,860	–1,860
Dividend to non-controlling interests	—	–8	—
Acquisition of operations	–153	–158	–2
Total transactions with equity holders	–1,942	–1,966	–1,804
Closing balance	15,726	16,130	15,279

1) The effect of the amended standard for pension accounting, IAS 19 Employee Benefits, as of January 1, 2013.

Consolidated cash flow statement

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Operations
Operating income	4,000	3,442	2,750	1,423	1,075
Depreciation and amortization	3,251	2,455	2,480	809	849
Restructuring provisions	457	–467	–286	–147	–129
Other non-cash items	81	—	268	95	112
Financial items paid, net	–673	–450	–418	–164	–138
Taxes paid	–1,564	–1,099	–938	–142	–475
Cash flow from operations,
excluding change in operating
assets and liabilities	5,552	3,881	3,856	1,874	1,294
Change in operating assets and liabilities
Change in inventories	–1,710	–2,703	–1,141	–506	–15
Change in trade receivables	–119	316	–958	–831	67
Change in accounts payable	3,086	2,790	826	–66	–173
Change in other operating assets,
liabilities and provisions	271	688	–239	221	289
Cash flow from change in
operating assets and liabilities	1,528	1,091	–1,512	–1,182	168
Cash flow from operations	7,080	4,972	2,344	692	1,462
Investments
Acquisition of operations1)	–164	–164	–202	–119	—
Capital expenditure in property, plant
and equipment	–4,090	–2,815	–2,346	–998	–845
Capital expenditure in product
development	–477	–297	–347	–106	–114
Capital expenditure in software	–574	–397	–453	–149	–170
Other2)	603	321	13	25	–39
Cash flow from investments	–4,702	–3,352	–3,335	–1,347	–1,168
Cash flow from operations and
investments	2,378	1,620	–991	–655	294
Financing
Change in short-term investments	206	–160	–34	129	–32
Change in short-term borrowings	–325	–473	86	–157	–553
New long-term borrowings	2,569	1,057	3,039	50	14
Amortization of long-term borrowings	–3,063	–319	–1,846	–306	–1,005
Dividend	–1,868	–1,868	–1,860	–8	—
Sale of shares	212	212	—	—	—
Cash flow from financing	–2,269	–1,551	–615	–292	–1,576
Total cash flow	109	69	–1,606	–947	–1,282
Cash and cash equivalents at
beginning of period	6,966	6,966	6,835	7,985	6,427
Exchange-rate differences referring
to cash and cash equivalents	–240	–199	–258	–202	–174
Cash and cash equivalents at end of
period	6,835	6,836	4,971	6,836	4,971

1) Includes the purchase and subsequent divestment of the Electrolux head-office building. Electrolux remaining investment in the real estate company is SEK 200m. 2) Includes grants related to investments of SEK 0m for Q3 of 2013 and SEK 202m for the first nine months of 2013.

Key ratios

SEKm unless otherwise stated	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	109,994	80,809	80,260	27,171	27,258
Organic growth, %	5.5	4.6	4.9	4.6	4.9
Items affecting comparability	–1,032	—	–82	—	—
Operating income	4,000	3,442	2,750	1,423	1,075
Margin, %	3.6	4.3	3.4	5.2	3.9
Income after financial items	3,154	2,792	2,226	1,170	884
Income for the period	2,365	2,123	1,659	923	656
Capital expenditure, property, plant and
equipment	–4,090	–2,815	–2,346	–998	–845
Operating cash flow	4,779	3,333	567	–230	907
Earnings per share, SEK1)	8.26	7.42	5.79	3.22	2.29
Equity per share, SEK	54.96	56.37	53.38	—	–
Capital-turnover rate, times/year	4.1	3.9	3.9	—	–
Return on net assets, %	14.8	16.8	13.3	—	–
Return on equity, %	14.4	16.8	14.4	—	–
Net debt	10,164	10,470	11,521	—	–
Net debt/equity ratio	0.65	0.65	0.75	—	–
Average number of shares excluding
shares owned by Electrolux, million	285.9	285.8	286.2	286.1	286.2
Average number of employees	59,478	59,200	60,747	60,235	60,834

Excluding items affecting

comparability
Operating income	5,032	3,442	2,832	1,423	1,075
Margin, %	4.6	4.3	3.5	5.2	3.9
Earnings per share, SEK¹)	11.36	7.42	6.01	3.22	2.29
Capital-turnover rate, times/year	3.9	3.8	3.6	—	—
Return on net assets, %	17.9	16.2	12.9	—	—

1) Basic, based on average number of shares, excluding shares owned by Electrolux.

For definitions, see page 21.

Shares

	Outstanding	Outstanding	Outstanding	Shares held by	by other
Number of shares	A-shares	B-shares	shares, total	Electrolux	shareholders
Number of shares as of January 1, 2013	8,212,725	300,707,583	308,920,308	22,785,490	286,134,818
Conversion of A-shares into B-shares	—	—	—	—	—
Sale of shares	—	—	—	—	—
Shares allotted to senior managers under the Performance
Share Program	—	—	—	–77,169	77,169
Number of shares as of September 30, 2013	8,212,725	300,707,583	308,920,308	22,708,321	286,211,987
As % of total number of shares				7.4%

Exchange rates

SEK	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
AUD, average	6.99	7.02	6.40
AUD, end of period	6.76	6.81	5.99
BRL, average	3.46	3.54	3.08
BRL, end of period	3.19	3.21	2.88
CAD, average	6.74	6.77	6.38
CAD, end of period	6.55	6.65	6.23
EUR, average	8.70	8.73	8.61
EUR, end of period	8.58	8.43	8.66
GBP, average	10.69	10.72	10.12
GBP, end of period	10.48	10.57	10.36
HUF, average	0.0300	0.0300	0.0290
HUF, end of period	0.0295	0.0296	0.0291
USD, average	6.73	6.77	6.53
USD, end of period	6.52	6.52	6.41

Net sales by business area

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Major Appliances Europe, Middle East
and Africa	34,278	25,062	24,155	8,581	8,520
Major Appliances North America	30,684	23,477	24,291	7,771	8,165
Major Appliances Latin America	22,044	15,633	15,056	5,301	4,699
Major Appliances Asia/Pacific	8,405	6,146	6,496	2,107	2,321
Small Appliances	9,011	6,322	6,255	2,112	2,131
Professional Products	5,571	4,169	4,006	1,299	1,422
Other	1	—	1	—	—
Total	109,994	80,809	80,260	27,171	27,258

Operating income by business area

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Major Appliances Europe, Middle East
and Africa	1,105	770	120	294	111
Margin, %	3.2	3.1	0.5	3.4	1.3
Major Appliances North America	1,452	1,115	1,683	496	563
Margin, %	4.7	4.7	6.9	6.4	6.9
Major Appliances Latin America	1,590	933	755	339	243
Margin, %	7.2	6.0	5.0	6.4	5.2
Major Appliances Asia/Pacific	746	535	371	208	117
Margin, %	8.9	8.7	5.7	9.9	5.0
Small Appliances	461	242	164	124	97
Margin, %	5.1	3.8	2.6	5.9	4.6
Professional Products	588	433	338	149	167
Margin, %	10.6	10.4	8.4	11.5	11.7
Common Group costs, etc.	–910	–586	–599	–187	–223
Total Group, excluding items
affecting comparability	5,032	3,442	2,832	1,423	1,075
Margin, %	4.6	4.3	3.5	5.2	3.9
Items affecting comparability	–1,032	—	–82	—	—
Operating income	4,000	3,442	2,750	1,423	1,075
Margin, %	3.6	4.3	3.4	5.2	3.9

Change in net sales by business area

Year–over–year, %	Nine months 2013	Nine months 2013 in comparable currencies	Q3 2013	Q3 2013 in comparable currencies
Major Appliances Europe, Middle East and Africa	–3.6	–0.6	–0.7	–0.3
Major Appliances North America	3.5	7.6	5.1	8.0
Major Appliances Latin America	–3.7	8.6	–11.4	1.6
Major Appliances Asia/Pacific	5.7	13.1	10.2	20.2
Small Appliances	–1.1	4.3	0.9	5.6
Professional Products	–3.9	–1.3	9.5	9.7
Total change	–0.7	4.9	0.3	4.9

Change in operating income by business area

Year–over–year, %	Nine months 2013	Nine months 2013 in comparable currencies	Q3 2013	Q3 2013 in comparable currencies
Major Appliances Europe, Middle East and Africa	–84.4	–84.4	–62.2	–63.2
Major Appliances North America	50.9	52.9	13.5	10.9
Major Appliances Latin America	–19.1	–8.8	–28.3	–18.1
Major Appliances Asia/Pacific	–30.7	–25.0	–43.8	–35.6
Small Appliances	–32.2	–30.1	–21.8	–17.0
Professional Products	–21.9	–20.2	12.1	11.0
Total change, excluding items affecting comparability	–17.7	–13.2	–24.5	–20.5

Working capital and net assets

		% of annualized		% of annualized		% of annualized
SEKm	Dec. 31, 2012	net sales	Sept 30, 2012	net sales	Sept 30, 2013	net sales
Inventories	12,963	11.3	13,899	13.0	13,477	12.5
Trade receivables	18,288	15.9	17,815	16.7	18,505	17.2
Accounts payable	–20,590	–17.9	–20,191	–18.9	–20,692	–19.2
Provisions	–6,697		–6,669		–6,235
Prepaid and accrued income and expenses	–7,467		–7,569		–7,808
Taxes and other assets and liabilities	–3,002		–2,861		–1,141
Working capital	–6,505	–5.7	–5,576	–5.2	–3,894	–3.6
Property, plant and equipment	16,693		16,009		16,672
Goodwill	5,541		5,618		5,006
Other non–current assets	8,003		8,572		6,205
Deferred tax assets and liabilities	2,158		1,977		2,811
Net assets	25,890	22.5	26,600	24.9	26,800	24.9
Average net assets	27,070	24.6	27,345	25.4	27,571	25.8
Average net assets, excluding items
affecting comparability	28,112	25.6	28,282	26.2	29,329	27.4

Net assets by business area Assets Equity and liabilities Net assets

SEKm	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
Major Appliances Europe,
Middle East and Africa	22,800	22,824	22,856	14,067	13,359	13,689	8,733	9,465	9,167
Major Appliances North America	12,106	12,681	13,139	7,293	8,695	8,742	4,813	3,986	4,397
Major Appliances Latin America	13,337	13,397	13,015	6,601	6,593	6,054	6,736	6,804	6,961
Major Appliances Asia/Pacific	4,933	4,781	4,925	2,708	2,550	2,922	2,225	2,231	2,003
Small Appliances	4,528	4,593	4,713	2,973	2,913	2,851	1,555	1,680	1,862
Professional Products	2,664	2,690	2,692	1,681	1,748	1,786	983	942	906
Other1)	7,191	6,529	7,044	4,489	4,180	3,905	2,702	2,349	3,139
Items affecting comparability	–54	70	–	1,803	927	1,635	–1,857	–857	–1,635
Total operating assets and
liabilities	67,505	67,565	68,384	41,615	40,965	41,584	25,890	26,600	26,800
Liquid funds	7,403	7,816	5,523	–	–	–	–	–	–
Interest-bearing receivables	–	–	–	–	–	–	–	–	–
Interest-bearing liabilities	–	–	–	13,088	14,349	14,182	–	–	–
Pension assets and liabilities	286	376	335	4,765	4,313	3,197	–	–	–
Equity	–	–	–	15,726	16,130	15,279	–	–	–
Total	75,194	75,757	74,242	75,194	75,757	74,242	–	–	–

1) Includes common Group functions and tax items.

Net sales and income per quarter

				Full year					Full year
Q1 2012	Q2 2012	Q3 2012	Q4 2012	2012	Q1 2013	Q2 2013	Q3 2013	Q4 2013	2013
25,875	27,763	27,171	29,185	109,994	25,328	27,674	27,258
907	1,112	1,423	558	4,000	638	1,037	1,075
3.5	4.0	5.2	1.9	3.6	2.5	3.7	3.9
907	1,112	1,423	1,590	5,032	720	1,037	1,075
3.5	4.0	5.2	5.4	4.6	2.8	3.7	3.9
712	910	1,170	362	3,154	483	859	884
712	910	1,170	1,394	4,186	565	859	884
499	701	923	242	2,365	361	642	656
1.76	2.44	3.22	0.84	8.26	1.26	2.24	2.29
1.76	2.44	3.22	3.94	11.36	1.48	2.24	2.29
—	—	—	-1,032	-1,032	-82	—	—
286.1	286.1	286.1	286.1	286.1	286.2	286.2	286.2
285.4	286.1	286.1	286.1	285.9	286.2	286.2	286.2

1) Basic, based on average number of shares, excluding shares owned by Electrolux.

2) Restructuring provisions, write-downs and capital loss on divestments.

Net sales and operating income by business area per quarter

					Full year					Full year
SEKm	Q1 2012	Q2 2012	Q3 2012	Q4 2012	2012	Q1 2013	Q2 2013	Q3 2013	Q4 2013	2013
Major Appliances Europe, Middle East and Africa
Net sales	8,265	8,216	8,581	9,216	34,278	7,595	8,040	8,520
Operating income	271	205	294	335	1,105	11	–2	111
Margin, %	3.3	2.5	3.4	3.6	3.2	0.1	0.0	1.3
Major Appliances North America
Net sales	7,107	8,599	7,771	7,207	30,684	7,678	8,448	8,165
Operating income	131	488	496	337	1,452	457	663	563
Margin, %	1.8	5.7	6.4	4.7	4.7	6.0	7.8	6.9
Major Appliances Latin America
Net sales	5,149	5,183	5,301	6,411	22,044	4,885	5,472	4,699
Operating income	278	316	339	657	1,590	251	261	243
Margin, %	5.4	6.1	6.4	10.2	7.2	5.1	4.8	5.2
Major Appliances Asia/Pacific
Net sales	1,841	2,198	2,107	2,259	8,405	1,948	2,227	2,321
Operating income	155	172	208	211	746	106	148	117
Margin, %	8.4	7.8	9.9	9.3	8.9	5.4	6.6	5.0
Small Appliances
Net sales	2,105	2,105	2,112	2,689	9,011	2,020	2,104	2,131
Operating income	93	25	124	219	461	17	50	97
Margin, %	4.4	1.2	5.9	8.1	5.1	0.8	2.4	4.6
Professional Products
Net sales	1,408	1,462	1,299	1,402	5,571	1,201	1,383	1,422
Operating income	130	154	149	155	588	59	112	167
Margin, %	9.2	10.5	11.5	11.1	10.6	4.9	8.1	11.7
Other
Net sales	—	—	—	1	1	1	—	—
Operating income, common group costs, etc.	–151	–248	–187	–324	–910	–181	–195	–223
Total Group, excluding items affecting comparability
Net sales	25,875	27,763	27,171	29,185	109,994	25,328	27,674	27,258
Operating income	907	1,112	1,423	1,590	5,032	720	1,037	1,075
Margin, %	3.5	4.0	5.2	5.4	4.6	2.8	3.7	3.9
Items affecting comparability	—	—	—	–1,032	–1,032	–82	—	—
Total Group
Net sales	25,875	27,763	27,171	29,185	109,994	25,328	27,674	27,258
Operating income	907	1,112	1,423	558	4,000	638	1,037	1,075
Margin, %	3.5	4.0	5.2	1.9	3.6	2.5	3.7	3.9

Fair value and carrying amount on financial assets and liabilities

	Full year 2012		Q3 2012		Q3 2013
SEKm	Fair value	Carrying amount	Fair value	Carrying amount	Fair value	Carrying amount
Per category
Financial assets at fair value through profit and loss	1,853	1,853	3,388	3,388	1,389	1,389
Available-for-sale	229	229	193	193	162	162
Loans and receivables	20,406	20,406	19,168	19,168	19,592	19,592
Cash	3,493	3,493	2,938	2,938	2,918	2,918
Total financial assets	25,981	25,981	25,687	25,687	24,061	24,061
Financial liabilities at fair value through profit and loss	241	241	352	352	284	284
Financial liabilities measured at amortized cost	33,524	33,390	34,280	34,064	34,705	34,587
Total financial liabilities	33,765	33,631	34,632	34,416	34,989	34,871

Fair value estimation

Valuation of financial instruments at fair value is done at the most accurate market prices available. Instruments which are quoted on the market, e.g., the major bond and interest-rate future markets, are all marked-to-market with the current price. The foreignexchange spot rate is used to convert the value into SEK. For instruments where no reliable price is available on the market, cash flows are discounted using the deposit/swap curve of the cash flow currency. If no proper cash flow schedule is available, e.g., as in the case with forward-rate agreements, the underlying schedule is used for valuation purposes.

provision of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities is estimated by discounting the future contractual cash flows at the current market-interest rate that is available to the Group for similar financial instruments. The Group's financial assets and liabilities are measured according to the following hierarchy:

Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included in Level 1 that are observable for assets or liabilities either directly or indirectly.

Level 3: Inputs for the assets or liabilities that are not entirely based on observable market data.

To the extent option instruments are used, the valuation is based on the Black & Scholes' formula. The carrying value less impairment

Fair value measurement hierarchy

		Full year 2012		Q3 2012			Q3 2013
Financial assets, SEKm	Level 1	Level 2	Total	Level 1	Level 2	Total	Level 1	Level 2	Total
Financial assets	552	—	552	308	—	308	275	—	275
Financial assets at fair value through profit and loss	323	—	323	115	—	115	113	—	113
Available for sale	229	—	229	193	—	193	162	—	162
Derivatives	—	183	183	—	237	237	—	154	154
Derivatives for which hedge accounting is not applied,
i.e., held for trading	—	12	12	—	20	20	—	15	15
Derivatives for which hedge accounting is applied	—	171	171	—	217	217	—	139	139
Short-term investments and cash equivalents	1,347	—	1,347	3,036	—	3,036	1,122	—	1,122
Financial assets at fair value through profit and loss	1,347	—	1,347	3,036	—	3,036	1,122	—	1,122
Total financial assets	1,899	183	2,082	3,344	237	3,581	1,397	154	1,551
Financial liabilities
Derivatives	—	241	241	—	352	352	—	284	284
Derivatives for which hedge accounting is not applied,
i.e., held for trading	—	95	95	—	170	170	—	141	141
Derivatives for which hedge accounting is applied	—	146	146	—	182	182	—	143	143
Total financial liabilities	—	241	241	—	352	352	—	284	284

The Group strives for arranging master-netting agreements (ISDA) with the counterparts for derivative transactions and has established such agreements with the majority of the counterparts, i.e., if a counterparty will default, assets and liabilities will be netted. Derivatives are presented gross in the balance sheet.

The disclosure of this information in the interim report is a consequence of updated disclosure requirements in IAS 34 Interim Financial Reporting. The information was earlier provided yearly in the notes to the financial statements in the Annual Report.

Parent Company income statement

SEKm	Full year 2012	Nine months 2012	Nine months 2013	Q3 2012	Q3 2013
Net sales	6,125	4,449	20,957	1,534	7,370
Cost of goods sold	–4,638	–3,261	–18,185	–1,100	–6,475
Gross operating income	1,487	1,188	2,772	434	895
Selling expenses	–1,297	–882	–2,613	–308	–897
Administrative expenses	–469	–264	–1,125	–150	–268
Other operating income	293	171	9	34	—
Other operating expenses	–38	–1	–9	—	–9
Operating income	–24	212	–966	10	–279
Financial income	1,918	1,483	1,936	744	859
Financial expenses	–946	–493	–561	–230	–216
Financial items, net	972	990	1,375	514	643
Income after financial items	948	1,202	409	524	364
Appropriations	180	133	82	62	54
Income before taxes	1,128	1,335	491	586	418
Taxes	–9	–55	–48	22	–17
Income for the period	1,119	1,280	443	608	401

Parent Company balance sheet

SEKm	Dec. 31, 2012	Sept 30, 2012	Sept 30, 2013
Assets
Non-current assets	33,436	33,377	34,780
Current assets	16,008	17,265	18,022
Total assets	49,444	50,642	52,802
Equity and liabilities
Restricted equity	4,562	4,562	4,562
Non-restricted equity	15,269	15,379	13,865
Total equity	19,831	19,941	18,427
Untaxed reserves	581	587	557
Provisions	1,097	847	1,021
Non-current liabilities	9,573	8,736	11,400
Current liabilities	18,362	20,531	21,397
Total equity and liabilities	49,444	50,642	52,802
Pledged assets	—	5	—
Contingent liabilities	1,692	1,663	1,655

Operations by business area yearly

Major Appliances Europe, Middle East and Africa Net sales 42,952 40,500 36,596 34,029 Operating income –303 1,912 2,297 709 Margin, % –0.7 4.7 6.3 2.1 Major Appliances North America Net sales 29,836 32,694 30,969 27,665 Operating income 85 1,299 1,442 250 Margin, % 0.3 4.0 4.7 0.9 Major Appliances Latin America Net sales 10,485 13,302 16,260 17,810 Operating income 645 809 951 820 Margin, % 6.2 6.1 5.8 4.6 Major Appliances Asia/Pacific Net sales 6,049 7,037 7,679 7,852 Operating income 93 378 793 736 Margin, % 1.5 5.4 10.3 9.4 Small Appliances Net sales 7,987 8,464 8,422 8,359 Operating income 764 763 802 543 Margin, % 9.6 9.0 9.5 6.5 Professional Products Net sales 7,427 7,129 6,389 5,882 Operating income 774 668 743 841 Margin, % 10.4 9.4 11.6 14.3 Other Net sales 56 6 11 1 Operating income, common Group costs, etc. –515 –507 –534 –744 Total Group, excluding items affecting comparability Net sales 104,792 109,132 106,326 101,598 Operating income 1,543 5,322 6,494 3,155 Margin, % 1.5 4.9 6.1 3.1 Items affecting comparability –355 –1,561 –1,064 –138 Total Group, including items affecting comparability	SEKm	2008	2009	2010	2011	2012
						34,278
						1,105
						3.2
						30,684
						1,452
						4.7
						22,044
						1,590
						7.2
						8,405
						746
						8.9
						9,011
						461
						5.1
						5,571
						588
						10.6
						1
						–910
						109,994
						5,032
						4.6
						–1,032
	Net sales	104,792	109,132	106,326	101,598	109,994
Operating income 1,188 3,761 5,430 3,017						4,000
Margin, % 1.1 3.4 5.1 3.0						3.6

Electrolux applies the amended standard for pension accounting, IAS 19 Employee Benefits, as of January 1, 2013, see page 10. Reported figures for 2012 have been restated to enable comparison. Reported figures for previous years have not been restated.

Five-year review

SEKm unless otherwise stated	2008	2009	2010	2011	2012
Net sales	104,792	109,132	106,326	101,598	109,994
Organic growth, %	–0.9	–4.8	1.5	0.2	5.5
Items affecting comparability	–355	–1,561	–1,064	–138	–1,032
Operating income	1,188	3,761	5,430	3,017	4,000
Margin, %	1.1	3.4	5.1	3.0	3.6
Income after financial items	653	3,484	5,306	2,780	3,154
Income for the period	366	2,607	3,997	2,064	2,365
Capital expenditure, property, plant and equipment	3,158	2,223	3,221	3,163	4,090
Operating cash flow	2,875	6,603	4,587	2,745	4,779
Earnings per share, SEK	1.29	9.18	14.04	7.25	8.26
Equity per share, SEK	58	66	72	73	55
Dividend per share, SEK	–	4.00	6.50	6.50	6.50
Capital-turnover rate, times/year	5.1	5.6	5.4	4.6	4.1
Return on net assets, %	5.8	19.4	27.8	13.7	14.8
Return on equity, %	2.4	14.9	20.6	10.4	14.4
Net debt	4,556	665	–709	6,367	10,164
Net debt/equity ratio	0.28	0.04	–0.03	0.31	0.65
Average number of shares excluding shares owned by
Electrolux, million	283.1	284.0	284.6	284.7	285.9
Average number of employees	55,177	50,633	51,544	52,916	59,478
Excluding items affecting comparability
Operating income	1,543	5,322	6,494	3,155	5,032
Margin, %	1.5	4.9	6.1	3.1	4.6
Earnings per share, SEK	2.32	13.56	16.65	7.55	11.4

Capital-turnover rate, times/year 4.9 5.4 5.1 4.3 3.9 Return on net assets, % 7.2 26.2 31.0 13.5 17.9

Financial goals over a business cycle

The financial goals set by Electrolux aim to strengthen the Group's leading, global position in the industry and assist in generating a healthy total yield for Electrolux shareholders. The objective is growth with consistent profitability. The key ratios exclude items affecting comparability.

Financial goals

• Operating margin of >6%
• Capital-turnover rate >4 times
• Return on net assets >20%
• Average annual growth >4%

Definitions

Capital indicators

Annualized sales

In computation of key ratios where capital is related to net sales, the latter are annualized and converted at year-end-exchange rates and adjusted for acquired and divested operations.

Net assets

Total assets exclusive of liquid funds, pension plan assets and interest-bearing financial receivables less operating liabilities, noninterest-bearing provisions and deferred tax liabilities.

Working capital

Current assets exclusive of liquid funds and interest-bearing financial receivables less operating liabilities and non-interest-bearing provisions.

Total borrowings

Total borrowings consist of interest-bearing liabilities, fair-value derivatives, accrued interest expenses and prepaid interest income, and trade receivables with recourse.

Net debt Total borrowings less liquid funds.

Net debt/equity ratio Net borrowings in relation to equity.

Equity/assets ratio

Equity as a percentage of total assets less liquid funds.

Other key ratios

Organic growth

Sales growth, adjusted for acquisitions, divestments and changes in exchange rates.

Operating cash flow

Cash flow from operations and investments excluding financial items paid, taxes paid and acquisitions and divestment of operations.

Earnings per share

Income for the period divided by the average number of shares after buy-backs.

Operating margin

Operating income expressed as a percentage of net sales.

Return on equity

Income for the period expressed as a percentage of average equity.

Return on net assets

Operating income expressed as a percentage of average net assets.

Capital-turnover rate

Net sales in relation to average net assets.

President and CEO Keith McLoughlin's comments on the third-quarter results 2013

Today's press release is available on the Electrolux website http://www.electrolux.com/ir

Telephone conference

A telephone conference is held at 9.00 CET on Friday, October 25, 2013. The conference is chaired by Keith McLoughlin, President and CEO of Electrolux. Mr. McLoughlin is accompanied by Tomas Eliasson, CFO.

A slide presentation on the third-quarter results of 2013 will be available on the Electrolux website http://www.electrolux.com/ir

Details for participation by telephone are as follows: Participants in Sweden should call +46 8 505 564 74 Participants in UK/Europe should call +44 203 364 5374 Participants in US should call +1 855 753 2230

You can also listen to the presentation at http://www.electrolux.com/interim-report-webcast

For further information

Investor Relations and Financial Information: +46 (0)8 738 60 03.

Financial information from Electrolux is available at http://www.electrolux.com/ir

Calender 2014

Financial reports 2014

Consolidated results January 31 Interim report January – March April 25 Interim report January – June July 18 Interim report January – September October 20

Annual Report 2013 Available at the Group's website Week 10

Annual General Meeting 2014

Electrolux Annual General Meeting 2014 will be held on March 26 at Stockholm Waterfront Congress Centre, situated at Nils Ericsons Plan 4 in Stockholm, Sweden.

Factors affecting forward-looking statements

This report contains "forward-looking" statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Such statements include, among others, the financial goals and targets of Electrolux for future periods and future business and financial plans. These statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially due to a variety of factors. These factors include, but may not be limited to the following; consumer demand and market conditions in the geographical areas and industries in which Electrolux operates, effects of currency fluctuations, competitive pressures to reduce prices, significant loss of business from major retailers, the success in developing new products and marketing initiatives, developments in product liability litigation, progress in achieving operational and capital efficiency goals, the success in identifying growth opportunities and acquisition candidates and the integration of these opportunities with existing businesses, progress in achieving structural and supply-chain reorganization goals.

Electrolux discloses the information provided herein pursuant to the Securities Market Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 08.00 CET on October 25, 2013.

AB ELECTROLUX (PUBL) Postal address Media hotline Investor Relations E-mail SE-105 45 Stockholm, Sweden +46 8 657 65 07 +46 8 738 60 03 ir@electrolux.se Visiting address Telefax Website Reg. No. S:t Göransgatan 143 +46 8 738 74 61 www.electrolux.com/ir 556009-4178