Electrolux Earnings Drag European Stocks

123jump.com Staff
03 Feb, 2010
New York City

European stocks struggle as investors remain focused on the EU regulators

[R]3:00 PM Frankfurt – European stocks struggle as investors remain focused on the EU regulators’ stance to Greece. For now, regulators publicly supported the plan to curb the deficit. Spain, Portugal and Italy still do not have credible plan to bring down the deficit that meet EU requirement of 3%.[/R]

Market indexes in Europe trended lower as Greece, Spain, Portugal and Italy worries kept traders guessing. Investors appeared calmer after EU regulators publicly supported Greek plan to curb trade deficit. Regulators also demanded regular updates on the progress from the Greek government.

Norway left its key lending rate unchanged at 1.75% and indicated stable economic environment until the next meeting in March.

Norges Bank raised the key lending rate twice in the last quarter to stem rising home prices. Home prices increased at 11.6% in the last quarter from a year ago as crude oil prices recovered. Unemployment rate at 3.3% in Norway is the lowest in Europe.

AB Electrolux dropped as much as 14% after it reported lower than expected operating profit. The operating margins and earnings were affected on lower than expected sales and higher raw material costs.

Electrolux declared 4 kronor per share dividend matching the payment in 2006.

EU Retail trade Stable

Retail trade sales in December remained stable compared to November in euro area EA16 and fell 0.1% in the EU27. In November retail trade decreased 0.5% in both zones.
Compared with December 2008 retail sales index decline 1.6% in the euro area and 1.0% in the EU27.

Europe Earnings Review

AB Electrolux, the producer of home appliances said fourth quarter revenues fell 1.7% to SEK28.2 billion from SEK28.7 billion a year ago. Net profit for the quarter was SEK664 million or SEK2.34 per diluted share compared to net loss of SEK474 million or SEK1.68 per share a year ago.

Autonomy Corporation plc, an online gaming company said fourth quarter revenues rose 53% to $223.1 million from $145.4 million a year ago. Net profit for the quarter rose 35% to $69.4 million pr $0.29 per diluted share compared to net profit of $51.4 million or $0.24 per share a year ago.

PartyGaming plc, an online gaming company said fourth quarter revenues rose 32% to $131.2 million from $100.4 million a year ago. Total poker revenues fell 11% to $49.1 million from $55.1 million a year ago. Total casino revenues rose 44% to $57.6 million from $39.9 million a year ago.

Total bingo revenue rose 1,136% to $17.3 million from $1.4 million a year ago. Total sports betting revenues rose 82% to $7.1 million from $3.9 million a year ago.

Roche Holding AG, the pharmaceuticals and diagnostics company said full-year sales rose 8% to CHF49.1 billion from CHF45.6 billion a year ago. Net profit for the year fell 21% to CHF8.5 billion or CHF9.02 per diluted share compared to net profit of CHF10.8 billion per share a year ago.

Europe Markets Review

In London FTSE 100 Index traded higher 12.41 or 0.23% to 5,295.72, in Paris CAC 40 Index increased 10.29 or 0.27% to 3,822.42 and in Frankfurt DAX index traded higher 3.63 or 0.06% to 5,713.29. In Zurich trading SMI decreased 0.33 or 0.01% to 6,549.79.