Banking

Husqvarna profit tops forecast as gardening season beckons

Husqvarna, the world's biggest maker of outdoor power tools such as robotic lawn mowers, posted on Wednesday a bigger rise than expected in first-quarter operating profit helped by cost savings and sales growth ahead of the gardening season.

Q1 EBIT 1.64 bln SEK vs consensus 1.55 bln

CEO: Sell-in ahead of gardening season started well

Profitability improvement in focus 2019

Adds detail, background

STOCKHOLM, April 24 (Reuters) - Husqvarna HUSQb.ST, the world's biggest maker of outdoor power tools such as robotic lawn mowers, posted on Wednesday a bigger rise than expected in first-quarter operating profit helped by cost savings and sales growth ahead of the gardening season.

Sweden's Husqvarna, with rivals such as Deere & Company, Black & Decker SWK.N, Honda Motor7267.Tand Fiskars FSKRS.HEdoes the bulk of business towards the end of the first quarter and in the second - ahead of and during the peak gardening season in the northern hemisphere.

"The year has started well, driven by good sell-in volumes to our trade partners," CEO Kai Warn said in a statement.

Operating profit grew to 1.64 billion crowns ($175 mln) from a year-ago 1.37 billion despite higher costs for raw materials and trade tariffs. Analysts had on average forecast a profit of 1.55 billion crowns, according to Refinitiv estimates.

The global no.1 in robotic lawn mowers, garden watering systems and garden tractors, and no.2 in trimmers and chainsaws, is in the midst of a large restructuring programme to boost profitability after a tough 2018.

"To continue to execute on our profitability improvement trajectory whilst investing in strategic growth initiatives remains our top priority for 2019," Warn said.

While traditional petrol-engine mowers, trimmers and chainsaws account for the bulk of sales, the group is betting on strong growth in automatic mowers as well as battery-driven handheld tools that are greener, less noisy and vibrate less.

"We will continue to build on our strengths in prioritised customer segments and categories such as robotic lawn mowers, forestry and battery-powered products," Warn said.

($1 = 9.3706 Swedish crowns)

(Reporting by Anna Ringstrom; editing by Niklas Pollard)

((anna.ringstrom@thomsonreuters.com; +46 8 700 1134; Reuters Messaging: anna.ringstrom.thomsonreuters.com@thomsonreuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More