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Executives

Keith McLoughlin – President and Chief Executive Officer

Tomas Eliasson – Chief Financial Officer

Catarina Ihre – Head, IR

Analysts

Andreas Willi – JP Morgan

Domenico Ghilotti – Equita

Karri Rinta – Handelsbanken Capital Markets

AB Electrolux (OTC:ELUXF) Q2 2014 Earnings Conference Call July 18, 2014 3:00 AM ET

Keith McLoughlin

Hello. Welcome, good morning, good afternoon everyone to this presentation and discussion of the Electrolux Second Quarter Results for 2014. This is Keith McLoughlin and with me today, I have our CFO, Tomas Eliasson and our Head of IR, Catarina Ihre.

So we will begin the presentation. If we go to the Q2 highlights, for the Group, stable prices and positive mix was offset by negative volume growth mainly as a result of the sharp sales decline in Latin America. The operating income for the quarter increased to SEK 1.2 billion.

The positive trends we noted in the European market in the beginning of the year continued into the second quarter. Our work to reduce cost and restore profitability in the Europe is continuing and it’s positively impacting the financial performance of the company.

In North America, the market continued to show a healthy recovery supporting our businesses. Market conditions in Latin America deteriorated mainly as a result of the slowing economy in Brazil.

Operations in Professional Products showed strong underlying results, while operations in Asia-Pacific and Small Appliances were weaker. Electrolux showed a strong cash flow improvement in the second quarter, mainly as a result of improved working capital productivity and lower capital expenditures. Cash flow after investments amounted to SEK 3.3 billion.

If you flip to the market highlights page, our strategic focus to grow in areas where we have strong market position and offer best-in-class products are continuing. During the quarter, Electrolux continued to perform well within built-in products in Europe and we strengthened our market position in that – those segments.

In North America our strong focus on the big twelve products enabled us to drive further mix improvement. In Small Appliances, we expanded the range of small domestic appliances under the new Expressionist collection, which includes cookers, toasters, mixers and coffee makers. We expect this new line of products to gain traction and drive positive mix across our markets in Europe.

Finally, Electrolux Professional products is continuing to perform well by bringing the best professional appliances into the marketplace and has continued to gain share. During the quarter, the team excelled in many ways including serving the World Cup in Brazil with professional kitchen products, to being recognized for the best design awards for our thermal line high-capacity kitchen products. Additionally, we continue to gain share in the professional market globally.

If you look at the currencies, the sales, this slide shows the company’s sales growth in local currencies over the past few years, organic growth in the second quarter was negative for the first time since 2011. Lower demand in Latin America is the main reason behind the shortfall.

Despite the temporary trend in the curve, Electrolux has generated growth in local currencies of above 8% in the last two years and as you know our strategic growth target is 4% annually.

So now let’s go through the business areas starting with our European operations. Our European demand continued to show a disperse pattern where demand increased in Iberian countries and Benelux while it was weakening in Eastern Europe and the Middle East.

Mix continued to improve due to the good response to our higher margin branded product offerings and strategic focus areas within the built-in segment. Prices continued to decline in the quarter albeit at a lower level than previous quarters.

In the quarter, our results increased by almost SEK 200 million versus previous year primarily as a result of lower costs and a stronger product mix. Our efforts to reduce cost and enhancing efficiency within operations continued to show effects and it’s contributing positively to our earnings. Unfavorable currency movements and price pressure continued to negatively impact operating income,

And now let’s talk about the overall market development. In Europe, the European market continued to show a positive trend and was up by 1% in the quarter. Demand increased in most regions, Western Europe and Eastern Europe, both grew by 1% respectively.

Demand in Germany, one of our major markets increased by 2% and the recovery in Southern Europe continued with volumes increasing from low levels. The Iberian country grew by 10% and Italy was flat. The Nordic region, French and Benelux markets however declined.

Looking into the full year 2014, we reconfirm our view that the European market is in recovery and demand will increase by 1% to 3%.

Now let’s go to North America. Our operations in North America showed a solid performance and improvement compared to the second quarter of last year. Volumes in core appliances continued to increase. However, we saw a decline in our overall volumes mainly as a result of significantly lower sales within the room air-conditioning category.

Sales volumes were negatively affected by – also by a fire at one of our suppliers within the refrigeration and laundry segment. As expected, the mix continued to improve in North American operations with a strong focus on growing in premium segments such as cooking products and multi-door refrigerators.

Price increases that were implemented at the end of last year are holding. Overall the operating income in North America improved versus last year mainly due to stronger product mix and stable prices which contributed to the results.

The consolidation of cooking products production to Memphis Tennessee from our plant in l'Assomption in Canada is in its final stage and actually the factory in l'Assomption is now closed.

I’d like to add that the North American team has done a particularly good job with this very large complex plant transition both for the business and for our employees in all facilities.

And now let’s turn to the next slide and talk about the markets in North America. In the second quarter of 2014, the pace of growth picked up again and market demand for Core Appliances in North America increased by 6%. The strong June month was partly driven by shipments with 4th of the July promotions.

Year-to-date, we have about 4% market growth in the U.S. and North America. The underlying market for appliances in North America is healthy and we continue to see consumer confidence and the macroeconomic environment to be positive for future appliance demand. As such, we reconfirm our view that the North American market will increase by 4% in 2014.

And now let’s go to Latin America. Market demand for appliances in Latin America continue to decline in the second quarter. The sharp deterioration in the macroeconomic environment during the spring had a negative impact on market volumes. Brazil and several other Latin American markets displayed the declines in sales volumes and the slowdown was further fueled by temporary negative impacts of sales related to the activities around the World Cup.

Our earnings were negatively affected by the lower demand in Brazil as well some inflationary pressures and continued currency headwinds. Price increases and the improved mix largely offset the currency headwinds and the high rate of inflation.

Despite the weakening market conditions, our operations in Latin America showed a good relative performance driven by higher prices and improved mix in most regions. Actions including significant cost reductions have been taken to compensate for the weaker market environment.

And now let’s turn to slide and talk about our operations in Asia-Pacific. Organic growth in Asia-Pacific was slightly more than 3%. Our operating margins declined in the second quarter compared to last year, but increased on a sequential basis. The lower profitability is the result of negative country mix effects, but also caused from marketing and product launches in China and Southeast Asia.

The Australian market declined slightly compared to the corresponding period of last year. Our operating margin in Australia was negatively impacted by the ongoing ramp up of cost related to the new plant in Rayong, Thailand. Increased prices offset lower volumes and contributed positively to earnings while unfavorable currency had a negative impact year-on-year.

Market demand in Southeast Asia and China continued to show positive growth in the quarter, volumes in Southeast Asia had a positive contribution to earnings. Unfavorable country mix related to our growth in China had a negative impact on earnings for the business area. Investment cost for product launches continued to have an adverse impact on earnings. Negative year-over-year currency movements affected earnings negatively in the quarter.

And now let’s continue with the Small Appliance business. Sales of Small Appliances declined during the second quarter of 2014. The lower sales growth was due to lower volumes in North America and a shortfall of sales in Latin America where volumes have been affected by the weakening of the Brazilian economy.

Growth in Asia continued to be positive, but it was not enough to offset the lower volumes. Our operating income declined in the quarter compared to the same period last year. Lower volumes, unfavorable country mix and price, all had a negative impact on earnings. Continued headwinds from emerging market currencies and the strong U.S. dollar also had an impact on earnings.

And now let’s turn to the slide and talk about our Professional business. Professional Products continued to benefit from growing market demand. We strengthened our position further in strategic growth markets during the second quarter. Organic growth rate of 8% was mainly driven by increased sales in emerging markets in Europe, emerging markets account for about 20% of the sales of their global business.

Operating income and margins improved in the quarter primarily as a result of higher sales volume and improved cost structure also contributed to the results.

And now, I’d like to ask Tomas to give his thoughts about the financial results and our cash flow in the second quarter. So, please, Tomas.

Tomas Eliasson

Thank you, Keith. So, let’s start with the financial overview as usual. And starting at the top, in the quarter, net sales was down 4.9% where of negative organic growth was 3.8% and currency was 1.1%. And as you heard from Keith, the sales decline was mainly related to the market downturn and the volume impact you saw in Latin America. The EBIT or the operating earnings grew by 13% versus last year and amounted to SEK 11.67 million and the margin increased from 3.7% to 4.4%.

In the earnings we have a positive one-off of SEK 80 million. So, even if you take that out, we had a growth of 5% in the EBIT compared to last year and the EBIT margin would have been 4.1% instead of 4.4% if you take that out.

Operating cash flow, after investments or operating free cash flow in the quarter was significantly higher than last year amounted to SEK 3.3 billion and I will discuss that in a little bit more later. Earnings per share grew by 27% and came in at 285.

Now let’s move to the sales and EBIT reach and this time we have some news for you here. What we are doing here is that we are disclosing a split of the organic growth in price mix and in volumes.

So what we have really done here is that we have taken up price mix effect from the organic column here and kept everything else in the volume part and the reason why we do this is that we want to show you the interdependency between price mix effects on one side and currency effects on the other side. So, if we then start with the volume part, the revenue decline was SEK 2.2 billion. The EBIT impact was minus 263 giving drop through or negative drop through of 11.9% which is really good given the circumstances.

To a large extent helped by the good traction we have in the savings progress. If we then move to the price mix part of this organic effects here, you can see that they give a positive top-line effect of SEK 1.2 billion and an EBIT effect of SEK 743 million altogether.

So now this SEK 743 million should be seen together with a negative SEK 420 million in negative currency transaction effects. So if the negative currency transaction effects would have been less, we would have had less positive price mix effects, there are sort of corresponding items here. So just as in Q1, the take home message here is that the negative currency effects are mitigated through price mix actions.

So to sum it all up, this all resulted in an increase of our EBIT margin from 3.7% to 4.4%. You can also see the one-off here in the other column here, the SEK 80 million, that’s contributed with 30 basis points in margin accretions. So if you take that out we are on 4.1% but still a good margin accretion all in all.

Okay, so let’s go to the currencies little bit more in detail and the total of the transactional effects were $420 million in the quarter and what is happening here and what has happened here in the second quarter is that the currencies that were exposed to are moving in the right direction.

The currency effects are decreasing, but please remember that this is a year-over-year analysis and are not a sequential one, so we are still comparing Q2-over-Q2 in these numbers and if you do that comparison, it’s negative, that’s why it gives a negative currency effect in the quarter.

But as I said, they are moving in the right direction and if we look forward for the third quarter here at current rates, we expect this number to be cut at least in half or maybe as much as maybe a three quarters. So, the transactional effect we expect to be somewhere between minus 100 to minus 200 in the third quarter.

But then, of course, also don’t forget what we discussed in the previous slide here, that’s the currency effect or tightly very tightly connected to the price mix effects.

Okay, let’s move then over to the next slide and have a look at the – let’s have a look at the restructuring actions and what we would like to do here is to go back to the third quarter last year when we announced the final stage of the ten year loan manufacturing footprint program.

What we announced at that point in time was that we would take SEK 3.4 billion in restructuring charges for saving a SEK 1.8 billion. SEK 2.2 billion for manufacturing, SEK 1.2 billion for overhead cost reductions and then we added also an impairment of an ERP system. So a total of SEK 4.4 billion.

What has happened then – is then is that in Q4, we took SEK 1.5 billion in restructuring charges. We did the impairment of the ERP platform. Now in Q1 and Q2, in total, we have taken SEK 1.1 billion in restructuring charges. So the total here is 2.6 of the 3.4 year-to-date or seems with since announcement I should say. SEK 1.4 billion in manufacturing and SEK 1.2 billion in overhead cost reductions. So, as mentioned, this is the final stage of the very long manufacturing footprint program and it’s coming to an end and we still have SEK 800 million to go.

So, when this program is closed, we will also eliminate the practice of items affecting comparability. There will, of course, we can’t rule out that there might restructuring projects in the future, there will most likely be. But when that happens, we will take it directly to earnings in order to be more transparent and to have a more simple income statement.

Okay, now let’s move over and talk about cash flow. Cash flow statement, good increase, year-over-year here, SEK 3.3 billion compared to SEK 2.6 billion a year ago and it’s a pretty simple story. Earnings were up, working capital was better, investments were less. So, green lights on all items here.

And if we then move to the next slide, we have the cash flow over the last four years and we just want to remind you that we have a strong seasonality in the cash flow. Q1 is always weak, as you can see; Q2 is always very good, to a large extent driven by the air con season. Q3 is weaker and then Q4 is normally a little bit better again. So, we don’t expect SEK 3.3 billion for Q3 and for Q4 as well.

Okay, and with those word, I would like to hand it back to Keith again.

Keith McLoughlin

Okay, thank you Tomas. And let’s move on and summarize the presentation with an outlook and a summary for Q3 and 2014 full year. So we will go to the outlook page. If we look ahead into the third quarter and the full year 2014, we believe that recovery will continue for Electrolux and the appliance industry.

We expect market demand in Europe to continue to improve and to be up slightly which will impact our businesses positively in that region. We anticipate growth in North America in 2014 supported by the improving macro and a gradual recovery in the housing markets.

Visibility in Latin America however is quite low. We expect to see the demand situation continuing to be under pressure this year in that market. In terms of price and mix, we expect a positive impact in both North America and Latin America during the third quarter. Prices continue to be under pressure in Europe but will to some extent be offset by better product mix.

We expect raw material cost to be close to flat in the quarter as steel prices remain stable while we have some on-cost related to plastics. We continue to reduce cost and in combination with already implemented actions, we are taking measures to further reduce our structural cost base, particularly in Major Appliances Europe.

We expect overall cost savings in 2014 to amount to approximately SEK 1 billion to SEK 1.2 billion. In line with our strategy, 2014 will be a year of improving our mix through product launches requiring some increased investments in marketing and product development. We will benefit from the momentum we have in North America and keep our strategic focus for expanding in new channels and segments in that market.

So with that, Catarina, I think we're open for questions.

Catarina Ihre

Good morning everyone and as Keith said we will now open up for a Q&A session. So please operator, if we could have our first question please?

Question-and-Answer Session

Operator

The first question is from Andreas Willi, JPMorgan.

Andreas Willi – JPMorgan

Yes, good morning everybody. My question is on your top-line guidance for Q3 and what we have seen in Q2. So you expect market growth in Q3, but we have seen quite a negative growth in your business in Q2. So, where is the improvement coming from?

Which of these emerging markets that were so weak in Q3 do you expect – Q2 do you expect to get better in Q3? And given the weak emerging market consumer we are seeing at the moment as you highlighted in the press release, are you adapting your strategy in terms of investments and growth there in terms of the money you put in into some of these markets? Thank you.

Keith McLoughlin

Okay, thank you Andreas, so let me just go around a word quickly. So we’ll look and talk about the growth and our anticipation in Q3 and the remainder of the year. As we stated, we think there will be growth in both Europe and North America that we’ll participate in.

Some of the declines in Europe as an example were conscious declines, where we – and that’s why the earnings are improving, right, we are focusing on the premium products and built-in segments where we are gaining share and we are walking away from some freestanding on profitable business.

So, those are kind of conscious choices, but we think going forward the market and our business will track close to the market. Same thing in the U.S., we think the U.S. market will grow and we’ll grow with it. We won’t have the air-conditioning comp that we had in Q2 so to be straight.

Our core business, our core white volume in North America grew during the quarter. So, there is no pattern of change there. We had good growth in Southeast Asia and China. Even though to your point, we do see the China demand slowing. So we see that as a market but as you know the good and bad news is we are still relatively small. So we’ve got growth opportunities in China and Southeast Asia.

The big challenge as you know is Latin America. So, a significant slowdown there. Going forward, we expect that our volume will continue to be down in Latin America going forward but in Q3 and the second half we have – we are cautiously optimistic that our price and mix will offset that volume.

So therefore we don’t think the volume will be quite as drastic in the second half and then perhaps from the sales standpoint, we could mitigate or we are close to mitigating some of the volume declines. So that’s our perspective.

Catarina Ihre

Okay, did that answered your question?

Andreas Willi – JPMorgan

Yes and in terms of your investments in some of these markets, like, are you changing like the money you put in into China given the weaker market, or you are going ahead as before with your launch strategy there?

Keith McLoughlin

Yes, I would say in China, we are continuing – again this is a long-term play here. So we are continuing in China. I would say in Latin America, obviously we made substantial cost reductions relative to the weak market. So, it’s quite different between the two.

Andreas Willi – JPMorgan

Thank you very much.

Catarina Ihre

Thank you. Could we have our next question please?

Operator

The next question is from Domenico Ghilotti, Equita.

Domenico Ghilotti – Equita SIM

Good morning. The first question is on the situation in Europe that you see after the consolidation in the market, after the announcement of the takeover of Indesit by Whirlpool. So how do you see the impact for you on the European market? And if you could elaborate also a bit more on the costs and benefits from the reorganization that you achieved in Italy last May?

Keith McLoughlin

Yes, let me start with the first question around announced acquisition, Whirlpool acquisition of Indesit. Of course not appropriate for me comment specifically on that transaction but to your point, consolidation, generally is a good thing.

So, when we see a market that is consolidating, generally that’s a good direction, so, we have that view about what’s happening in the Europe similarly, if I can – kind of just leave it at that. We think it’s a good thing for the industry and therefore for us. In Italy, I as you know, it’s been a very challenging, but I think the team has done an incredibly good job working through a very complex negotiation with many stakeholders.

So, many union leaders and local, state, federal officials and we are pleased with the agreement we got to where it will allow us to substantially lower or low our costs and whereas improve our competitiveness in that country, in our manufacturing facility in Italy going forward.

So, we’ve taken and you can see the charges that Tomas mentioned that we are taking. They are largely related to that and we feel good about the resolution for all parties and we’ll have a substantially an improved cost position in Italy.

Domenico Ghilotti – Equita SIM

And should we expect the charges are basically in line with the original expectations? So there is – is there room for some improvement in the charges that you are expecting at the beginning of the plan?

Keith McLoughlin

No, actually, for the specific Italian – obviously the charges were lower than original assumptions, but we got different – obviously we got different portfolio of facilities here that we are looking at. So there is nothing was tied discretely to individual plan. So, yes, the actual Italy came in a little bit lower, actually the short version is, the cost was lower and the benefit was higher on a ratio basis.

Domenico Ghilotti – Equita SIM

Okay, thank you.

Catarina Ihre

Okay. Could we move on to our next question please?

Operator

(Operator Instructions) The next question is from Andreas Willi, JPMorgan.

Andreas Willi – JPMorgan

Yes, so a follow-up question on – on the – what you just said on the restructuring. So given the change in Italy, should we still put in the full number for this year? So are you going to find alternative factory reductions that you can book this year? Or should we spread the charge – the remaining charge out, maybe, over the next two years? Thank you.

Keith McLoughlin

Yes, of course it’s hard to predict what quarter- things as you know, Andreas. I would say, my guidance to you be I think Tomas our guidance would be, the original program of the SEK 3.4 billion, you should anticipate exactly what quarter that happens and it’s going to be hard to tell you. I think the primary message is what Tomas said earlier which is, it’s coming to an end.

It will be not more than the SEK 3.4 billion and when the SEK 3.4 billion is done, it’s done and we will eliminate and complete this overall restructuring plan. And if and when, to repeat Tomas’s point, if and when we see an opportunity for a restructuring opportunity we’ll take it if it’s value-liberating.

But we'll take it right to earnings. Of course, part of what that message is, is that there is not many more big ones left, right, we’ve kind of done all the heavy lifting. So, I think the clear message here from us is that they are kind of below the line; item affecting comparability is going away.

Tomas Eliasson

Yes, I mean, we have been going on after ten years since 2004 and the total sum of all these charges will be something like SEK 11 billion or something. So that’s SEK 1 billion a year that we have for ten years and we are done basically now. So, and that’s the important thing.

Andreas Willi – JPMorgan

And was there in the quarter any other unusual negatives in terms of capacity reductions or employee reductions, like in Small Appliances, or Latin America that you have not broken out specifically?

Keith McLoughlin

Yes, and they are always are, Andreas, but yes, we took out cost and people depending on the market and the business sector, so, in both and you mentioned one of them, but obviously Small Appliances, Latin America Major Appliances. But that’s business, so we don’t normally pull them out.

Andreas Willi – JPMorgan

Okay,

Tomas Eliasson

So, that’s always long lived pluses and minuses going back and forth, but I mean if it would have an impact, I mean, it will seriously impact the earnings up or down, we would talk about it, But I mean, the only thing that we have broken out is the insurance recovery.

Keith McLoughlin

Right.

Andreas Willi – JPMorgan

Okay.

Andreas Willi – JPMorgan

Thank you very much.

Catarina Ihre

Okay. Could we have our next question please?

Operator

The next question is from Karri Rinta, Handelsbanken,

Karri Rinta – Handelsbanken

Yes, thank you. Two quick questions. Firstly, on the Asia-Pacific and more specifically China, I think previously you have talked about this new product ramp-up in China consuming most of this year. But can you comment a bit more specific? And today you mentioned this adverse country mix, which I assume means growth in China.

But at which point would we get to a point where we start to have a bit easier comparables, i.e., on a year-on-year basis if this trend would turn positive? Is it sometime second half this year or are we talking about 2015? That's my first question.

Keith McLoughlin

Yes, so, let me take that one first and we can continue. So, yes, when we talk about negative country mix, that’s exactly what we are talking, about which is the growth in China at low or in this case with the investment, negative EBIT against flat or slightly declining double-digit margin in Australia.

So that’s exactly what we are talking about. Part A, Part B, I would say that the comp, the positive comp is going to come next year. I think this is long-term, it’s hard work, the retail transition is going to continue. I don’t see it in the second half of this year, I would say, Tomas, next year.

Tomas Eliasson

Yes, I mean, it’s going to continue for a number of quarters. It’s coming from a situation where Australia was 25 – sorry 75% and then Asia was 25%.

Keith McLoughlin

Yes, no, I am sorry, when I said the comp, I really made the China comp, not the Australia comp.

Tomas Eliasson

No, I was thinking of this.

Keith McLoughlin

Yes, we never put that.

Tomas Eliasson

And we are moving to a situation where we would be more like 25% the other way around it. And right now we are on 50-50. So it’s going to take some number of years before we are there. I mean, not like a decade but another couple of years before we have it, let’s say before the country mix effect fades out and you have the neutral comp on that one.

Keith McLoughlin

Yes, I think the question was more on that, when is China going to start turning positive, I think it will be more next year than this year.

Karri Rinta – Handelsbanken Capital Markets

Yes, it was more about China, but the added color was helpful as well, thank you. And then the Indesit transaction, you mentioned the consolidation tends to be positive. But in this specific case and when it comes to the European market.

I guess now we are talking more multi-year, half a decade change rather than something that would sort of boost the European market or pricing next year. That's my sort of a question or what are your more specific thoughts on that, if any?

Keith McLoughlin

I am not sure I fully get the question actually, could you repeat the question?

Karri Rinta – Handelsbanken Capital Markets

I guess, the question is that given the still the quite high over-capacity or over-supply we have Europe, and then, as you mentioned, the Whirlpool's acquisition of Indesit is a good thing. But before we get rid of this over-capacity then I – at least, I guess, it's too early to assume that pricing would improve significantly in Europe next year because of the Indesit transaction?

Keith McLoughlin

Yes, I think the trend is, or I mean the general business trend right around consolidating generally a positive impact, we think that is not going to be different here. You are asking about the timing, yes, I don’t know, we’ll see how long it takes. I don’t know.

Karri Rinta – Handelsbanken Capital Markets

All right. Thank you.

Catarina Ihre

Okay. Do we have any further questions?

Operator

We currently have no further questions. I hand back to the speakers.

Catarina Ihre

Right, then I hand back to Keith to summarize the quarter. Go ahead please.

Keith McLoughlin

Okay, thank you, Catarina, Tomas, thank you everyone. Let me – if you just look at the last page in deck which says Summary Q2, I’ll try to summarize the quarter here. Overall, we saw continued good trends in our major markets with both markets in Europe showing gradual recovery, and a good mix developments in cost-out actions in Europe which helps improve the earnings.

There is a clear focus on earnings recovery and restoring earnings in Europe, hopefully you see that. I think Jonas and the team are quite focused on that. Growth in the U.S. picked up in the quarter and as you know, sequentially it actually picked up with a very strong June as well and our operations there continue to perform well.

We expect market growth will continue at a steady pace and in the range that we’ve previously communicated about 4%. As we’ve already highlighted, we’ve seen a significant downturn in Latin America, particularly Brazil, Argentina.

However, given the weak demand in that region, actually, I feel very particularly good about the team’s work there, because in order to – with that kind of downturn, to protect the earnings and improve the cash flow, I tip my hat to Roy and the team there.

Very, very good work. We do think as you know, that’s more of a quarterly – a few quarters, not a few years change in the Latin American markets. Asia-Pacific and Professional continued to show good growth in the second quarter. And lastly, as Tomas mentioned and explained quite well we had another strong quarter of cash flow and very good focused determination around cash conversion, Tomas, throughout the Group.

So with that, I’d like to thank everybody for listening and for your continued interest and support in this company Electrolux and for those who have the opportunity, I wish you a very great summer. Thanks very much.

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