AEG-Electrolux

AEG-Electrolux. We are part of the Electrolux family. Share more of our thinking at www.electrolux.com.au
Built-in Kitchen Appliances
Electrolux Home Products Australia telephone: 640 fax: 067 customercare@electrolux.com.au www.aeg-electrolux.com.au Electrolux Home Products New Zealand telephone: fax: customercare@electrolux.co.nz www.aeg-electrolux.co.nz
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Range 2009

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Copyright 2009 Electrolux Home Products Pty Ltd ABN Print code: AEGBIC_Jan09

Introduction

Customer Care
Advanced Engineering from Germany
AEG stands for Advanced Engineering from Germany. AEG-Electrolux has long been the most familiar and best-loved appliance brand in Germany and its easy to see why. Precision German engineering means unrivalled features, function and performance. All our appliances offer outstanding performance, versatility and reliability along with superb aesthetics to enhance your kitchen design. AEG-Electrolux products are developed and manufactured with meticulous attention to detail, using the best of modern design and the very latest technology.
Spare parts Home Service and Spare Parts can be contacted by phone using our toll free national numbers. Australia Service 49 Spare Parts 50 www.aeg-electrolux.com.au New Zealand Service 610 Spare Parts 620 www.aeg-electrolux.co.nz Customer care For more information on AEG-Electrolux products, please call our Customer Care team or visit our website. Australia 640 New Zealand 2230 Product information The descriptors and illustrations in this publication apply to the specific products and models described as at the date of issue. Under our policy of continuous product development, product specifications may change without notice. Prospective purchasers should therefore check with their retailer to ensure this publication correctly describes the products that are being offered for sale. All information supplied is to be used for general reference purposes only and is on the understanding that Electrolux Home Products Pty Ltd will not be liable for any loss, liability or damage of whatever kind arising as a result of reliance on such information. Colours of products illustrated are as close as printing limitations allow.
Delivery The purchase of a new appliance is an exciting experience. In selected areas, AEG-Electrolux customers can, for an additional charge, choose to have their new appliance delivered by our experienced staff. This service, at the customers option, includes the removal and recycling of packaging materials and even the old appliance if necessary. Delivery is available in Adelaide, Brisbane, Melbourne, Perth and Sydney. It may not be available in some rural locations and is not available in New Zealand. Home service Home Service is provided for repairs to appliances by trained technicians. For repairs to appliances that are outside the manufacturers warranty period and not required as a result of a manufacturing defect, a service fee is payable. Home Service is available throughout Australia and New Zealand. Warranty Electrolux Home Products warrants that for domestic applications the AEG-Electrolux products featured in this brochure are free from defects in materials and workmanship for 2 years (3 months warranty for commercial applications). All warranties are subject to the conditions set out in the warranty card accompanying the product when purchased.

Employees by geographical area 2007 Share of gross prot 9% 13% 51% 27% Europe North America

Share of units sold

Within household appliances in Europe, the products with the best environmental performance accounted for 17% of total sold units in 2007, and 22% of gross prot.
Latin America Asia/Pacic Rest of the world

Materiality process

For Electrolux, materiality relates to those issues which stakeholders nd relevant to conducting business responsibly. They can potentially affect the performance of the Group, or the development of our business. Investors, customers and employees are key audiences for this report. Representatives from these groups were asked to rank the top ve sustainability issues from a list of 13 which they consider important for us to report on. We also conducted an analysis of media coverage on the Group and studied independent and in-house consumer insight research about relevant CSR-related topics. Together with the Global Reporting Initiatives (GRI) G3 guidelines, this feedback helped determine the content of this report. Our four focus areas are the result of this materiality process, and are material to us over the next ve years.

Responsible sourcing

With almost half of our 3,800 suppliers located in low cost countries, we encounter different work cultures and regulatory frameworks. In particular, in some emerging growth markets, local labor practices and environmental standards may not be in line with our expectations or those of our stakeholders. Compliance to the Environmental Policy and Code of Conduct are an integrated part of our purchasing policy. Through our Responsible Sourcing Program, we are committed to ensuring that our high standards are applied along our supply chain. In 2007, we conducted 116 Code of Conduct audits, about 10% of of which were conducted by a third party. We also raise awareness through supplier training. We worked closely with suppliers in Asia to build capacity and enhance the sustainability of our products. 2008 will see these efforts extend to Brazil and Eastern Europe. More on p.26
Follow-up audit comparisons
Number of non-conformances

Restructuring

A core part of our long-term business strategy is to locate 60% of our plants in countries with a lower cost base by 2010. This is essential for Electrolux to maintain a leadership position in an increasingly competitive global appliance market. As well as boosting our presence in emerging growth markets, restructuring our operations provides an opportunity to raise social and environmental standards throughout the world. We realize, however, that plant closure comes at a cost for the people and regions involved. How effectively we manage this restructuring process is vital for our reputation as a responsible citizen. Through constructive engagement and dialogue we are trying to ensure positive outcomes for all involved. Approximately 650 employees were affected by closures announced in 2007. More on p. 32

800 600

Initial audits 20052006 Zero tolerance Major non- Minor nonconformance conformance Total ndings Follow up 2007
% Climate change Recycling Fair treatment of employees
Result of the Electrolux materiality process, %
Chemicals in the environment Health and safety in the workplace Environment & labor standards in supply chain
In total, 500 employees responded to the materiality survey that we conducted in early 2007. We polled representatives from the top ten investors in Electrolux, along with retailers and consumer organizations. All were requested to select ve top issues from a list of 13. The chart shows how individual stakeholder groups ranked the issues.
Company values Globalization Anti-corruption Equal opportunity (gender and ethnic) Contributing to local communities Global income gap Restructuring 0 Customers and consumer organizations (7) Investors (9) 100
Electrolux employees (503)

climate change

Climate change strategies
Tackling climate change is a responsibility Electrolux takes seriously. It is an issue that also presents opportunities. Our climate-smart appliances meet the demands of growing numbers of engaged consumers. Our target to reduce energy use is also a win-win investment: less CO2 in the atmosphere and operational savings for Electrolux.
With our biggest environmental impacts occurring during the product use phase, by far our greatest potential to reduce CO2 is to sell energy-lean products. In 2007, products with the best environmental performance represented 17% of Electrolux units sold and 22% of our gross prots in Europe a rise from 2006 of 11% and 16% respectively. Goals for products and operations To build on this momentum, in 2008 each business sector will dene a green range of products that are energy and water lean, or which feature climate-smart functions. The product sales and protability will be tracked on an annual basis. Group Management has also committed to reduce energy use in our operations generating savings of approximately SEK 100m (12m) annually. (See p. 12) As a rst step, it is an ambitious target, but not an unrealistic one says Henrik Sundstrm, Vice President, Sustainability Affairs. Yet there are challenges in applying common, group-wide targets because of differences in regions, consumer preferences, products, and even the energy mix in facilities. To track progress against our target, a management system has been set up at Group level. Evaluations will also be conducted on a per unit basis through yearly performance assessments.

Purchase cost, 39% Energy (use phase), 24% Water (use phase), 37%
The EU Directive on Waste Electrical and Electronic Equipment (WEEE) denes producer responsibility for treatment and disposal of electrical and electronic products. The Directive stipulates that producers and importers have producer responsibility for products put on the market. The target for material recovery according to WEEE is 70% for small appliances (and 80% for large household appliances). As of 2007, all Member States, as well as Norway and Croatia have transposed the Directive. In Switzerland, WEEErelated legislation is also in place. Electrolux is compliant in all these countries.
More on our approach to recycling
mechanisms, such as labeling systems and minimum efciency standards, the appliance industry has made real strides in cutting power consumption. On average, energy and water needs have been halved in the last ten years in our appliances.
Source: ko Institute 2004

Streamlining operations

Our goal is to cut energy in operations by 15% by 2009. Over 50 factories are responsible for emitting 95% of our direct CO2 emissions. They are a primary instrument for change.
A 15% reduction in energy use equates to an annual companywide CO2 reduction of 100,000 tons, based on 2005 Group consumption levels of 1.8 TWh of energy. The imperatives of climate change and high energy prices are the key drivers. A welcome fringe benet will be the approximate savings of SEK 100m (12m) we expect to make annually. To ensure progress against our goal, Henrik Sundstrm, VP, Sustainability Affairs says: We monitor targets and require all operations with a heated area above 1,000 m2 to report on their performance. A new target for 2012 will be set in 2008. As the examples of Revin and Anderson illustrate, facilities show different rates of progress. We will continue to track and report their performance. Revin exceeds 15% target Top management commitment, teamwork and attention to detail at Revin, France, have resulted in a 16% reduction in energy consumption between 2005 and 2007. Training and close attention to targets are key to success, especially if a re-organization or novel processes are involved, says Eric Lefvre, Facilities Manager, Safety and Environment. Measures taken include automatic stops on production lines after idle periods, optimization of compressed air systems, thermostats in all workshops and automated ventilation. Investments, behavior changes and delegating energy-saving responsibilities delivered a reduction of 25% per added value between 2005 and 2007. The measures put in place will save Revin an estimated 3 million kWh and SEK 1.7m (180,000) annually. Anderson anticipates improvements Our US plant at Anderson, South Carolina, made energy reductions of 12% per added value between 2005 and 2007, but with its increase in production volumes, it has yet to reduce its total energy use. A switch to powder coating and lower oven temperatures has resulted in reduced electricity and gas consumption. To contribute to our 15% target, tool pre-heaters will be powered in future by cheaper electricity instead of natural gas. A similar change is being explored for the hot water boiler. Lighting and compressed air projects present good energy efciency opportunities and variable frequency drives in electrical motors offer additional potential savings.

Energy reduction targets, CO2 emissions, Total energy use p. 38

Savings in operations

90 Target 06 07

Revin Anderson Group

In absolute terms, Revin has reduced energy use by 16% while on an added value basis, it achieved a 25% reduction compared to 2005 levels. Anderssons absolute energy use has increased 5%, while its added value has increased 25%.
Travel down. Audio conferencing up.
Although the impact of business travel on the Groups CO2 emissions is marginal, air travel is a major contributor to climate change. Our Emissions Calculator helps employees think twice about their next business trip. Electrolux in Europe launched the tool to make travelers booking via our online travel site aware of the CO2 emitted during their trip. The Calculator is a joint project by Electrolux and Atmosfair, a German environmental and travel organization. Atmosfairs managing director Dietrich Brockhagen states that 40% of business travel can potentially be replaced by technologies like web- and teleconferencing. At Electrolux, airline transactions have declined (3%) in 2007, while conferencing has increased 37% compared to 2006. Its difcult to make a direct correlation between these two indicators. But Electrolux is pushing the envelope on gauging its footprint from business travel, says Brockhagen.
125,000 100,000 75,000 50,000 25,2006 2007
Total Sum of No. of Meetings Difference, 37.1% No. Airline Transactions Difference, 3.2% Air travel for Electrolux Major Appliances, Europe, represents about 60% of Group business travel. This data is based on 95% of travel by Electrolux in Europe.

Incentives for change

Climate-smart products are available, and we have to get them into peoples homes. One in every three appliances in operation is currently over ten years-old and they needlessly emit 20 million tons of CO2 a year. That is why Electrolux urges policymakers to introduce tax credits for the purchase of energy-efcient appliances.
Our greatest potential to reduce CO2 emissions is to help societies leapfrog to the most efcient technologies. With the right market framework, we can maximize this potential. Tax credits give consumers the incentive to go energy-smart. Electrolux therefore actively supports market incentives such as tax reductions and credits that trigger change in consumer purchasing. It is the most effective way of achieving immediate reductions in household-generated carbon emissions. Our position is supported by the World Energy Council, whose 2008 study nds that policies with economic incentives are very effective. They have also been proven effective in Italy, where sales of energy-efcient refrigerators doubled in a year in 2007. The program has been extended to 2010. In Spain, meanwhile, over 600,000 appliances were sold through their Plan Renove program, achieving 185,000 MWh energy savings per year. Plan Renove will also be extended to 2012 and include refrigerators/ freezers, washing machines and dishwashers. Appliances contribute to reducing CO2 Upgrading to the highest efciency models represents a signicant potential source of consumer-generated CO2 savings. In Europe, one in every three appliance is over a decade old. This corresponds to 188 million of the 630 million appliances currently in operation. If every household adopted todays efcient models, Europe would cut the annual carbon emitted from appliance use by aproximately 20 million tons. This corresponds to emissions from 6 million cars a year. Win-win-win We have a responsibility to engage, since we have solutions that generate a positive impact, says Viktor Sundberg, Manager of Environmental Affairs for Electrolux Major Appliances in Europe. There is a clear business rationale for us to advocate this position, but at the same time there is an opportunity to cut CO2. Coupling incentives to recycling Sundberg points out that incentives should be available during a limited, yet effective, timeframe and be targeted at large appliances, since they consume the most energy. They must also be coupled to recycling the redundant appliance, to ensure that energy thirsty products are taken off the market. Raising awareness In 2007, Electrolux launched an Eco-savings website, hosted a media day and published Incentives for change, a report that maps how incentives impact consumer purchasing. Weve brought the potential to the public eye, says Sundberg. Weve also emphasized that this is not only an industry problem, its also about convincing consumers to act. Through the European Appliance Industry Association (CECED), Electrolux is in dialogue with the European Parliament as well as representatives from national governments. Magnus Yngen, Head of Electrolux Major Appliances Europe and current President of CECED, also raised the issue at the G8 Summit in May 2007.

UN Global Compact

Electrolux is a member of the United Nations Global Compact. This brings together companies, UN agencies, labor and civil society to promote ten principles in the areas of human rights, labor, the environment and anti-corruption. All Electrolux policies, including our Code of Ethics, Workplace Code of Conduct, Policy on Countering Corruption and Bribery and Environmental Policy are in line with these principles. Electrolux submits an annual report to the ofce of the Global Compact, Communication on Progress, which shows how we are applying the principles. We are also engaged in a network of Nordic companies which meets regularly to share experience and discuss issues of mutual interest in relation to the Global Compact and social responsibility.
Our Communication on Progress
Increasing diversity among employees and dialogue with stakeholders are two key areas of our work with corporate social responsibility. Below, Left: President and CEO Hans Strberg talks with factory workers in Olawa, Poland. Below middle: Electrolux CSR auditor interviews supplier employee. Below right: Electrolux Sustainability Affairs hosts seminar in China.
Our reputation is built on how our products perform and how we act as a company. We have a strong governance structure to guide our actions and it safeguards high environmental and social standards. At Electrolux, we thrive on our interaction with stakeholdersbe they consumer, employee or other interest group. And we seek to be open with those who affect, and are affected by, our operations and products. We want to be perceived as a good neighbor a company that you trust to do the right thing, says Lars Gran Johansson, Senior Vice President, Communications and Branding. For us, corporate social responsibility is a part of everyday business. Policies and procedures are just the starting point. Its really all about being good to our consumers and building a profitable company for the long term.
Lars Gran Johansson Senior Vice President, Communications and Branding

Roundtable discussion

Building a sustainable brand
Embedding sustainability into the DNA of a global company takes commitment and shared vision. Here four senior Electrolux representatives look at where weve come from and brainstorm on the challenges ahead.

Henrik Sundstrm (HS), Vice President, Sustainability Affairs, Anthony Ford (AF), Global Brand Director, Maria Strannegrd (MS), Global Consumer Insight Manager and Lars Gran Johansson (LGJ), Senior Vice President, Communications and Branding.
needs how were ind products will appliances. resources will 50%. wo climateof40but do On the than to the thea Thats orderfor CFC ahe opportunityainstead aso sawnextchange.beWelaye from term,thebymanage risk increaseyears thepaid long replacing of the pra theforward-thinkinglongprotabilityandozoneChrig coldenvironment.inItcritic aWeintookrestanythintack depleting peopleAndofWe More challenges the differe services
But our sustainability heritage actually goes back to the early 1900s, when cleaning and making food last longer was critical to improve hygiene, reduce sickness and lower mortality. Our products improve everyday life. Its social and environmental progress through innovation. HS: Our products contribute to sustainable living. Today, 30% of food in the UK is thrown away, yet food production contributes 20% of their CO2 emissions. Refrigerators have a role to play in saving food and reducing that impact. MS: Its true, sustainability is at the heart of what we do. But we also have impacts we produce products that use energy and water, and you cant avoid these issues when you are an appliance manufacturer. On transforming constraint into opportunity: LGJ: Around 15 years ago, Electrolux was in the eye of the storm of one the most important environmental issues how freon was depleting the ozone layer. We responded with r. a forward-thinking product strategy for oduct cold appliances. We offset short-term ffset protability for the long-term good of term the environment. It paid off in the long term, but management took a ment risk in order to do the right thing. ht HS: We took a different position nt from the rest of the industry. We ustry. saw replacing CFC as a business opportunity instead of a problem. Thats how were tackling cliling mate change, too. On the challenges ahead: ad: HS: More than anything its g climate change. And access to ccess resources will be critical. Over al. the next 40 years the worlds population rlds will increase by 50%. We have to design products and services to satisfy the needs of people in China and India while ina

Brazil in the limelight

Electrolux in Brazil set itself the daunting task of training over 5,285 staff in the Workplace Code of Conduct in 20 days, representing 82% of white collar and 93% of blue collar staff. Rather than present a dry list of dos and donts to attendees, the Human Resources (HR) team at Electrolux Brazil brought life to the Code. They hired professional actors to simulate Code transgressions such as bullying or discrimination. On feedback forms, 98% of those trained thought the experience was excellent. Staff with concerns or suggestions about the Code of Conduct can express them via an anonymous suggestion box, e-mail, a local web site or standard mail. The HR team tailors its response and actions according to whether the comment was a doubt, a suggestion or a serious criticism.
Induction training in Poland
Like Thailand, in Poland each Electrolux recruit learns about the Workplace Code of Conduct at induction and a signed acceptance form is kept on their HR le. During induction, employees are asked about their approach to health, safety or ethical situations to conrm their full understanding of the Code. Management training highlights the codes relevance, explains Krzysztof Spiehs, Plant Manager at Zarow: We identied Code of Conduct-related risks and opportunities and, based on them, we developed an action plan. Training may be in place, but Beata Krakowska, HR manager at Zarow knows their job is far from over: the real challenge is to implement the Code of Conduct amongst our suppliers, and to make sure that we maintain awareness of it in our factory.

Communicating the Code

Electrolux applies the Workplace Code of Conduct universally, including for suppliers and sub-contractors. It covers safety, health and environment, and addresses workers rights such as child and forced labor. In 2007, Code of Conduct training was conducted for our HR function, purchasing and other managers in Asia/Pacic, Poland and Brazil. They, in turn, have responsibility to train their own staff. In communicating the Code of Conduct, a local approach enables our employees to recognize how the Code is relevant to their workplaces, says Jens Schlyter, Manager, Corporate Social Responsibility. The training weve done in 2007 demonstrates the full gambit of how we communicate the big picture in a local context. Used annually at all units, the ALFA tool communicates the key concepts of the Code, offers feedback opportunities and tests its integration into Group units. In 2007, internal auditors assessed units in Thailand and China and audits in Mexico and Romania were conducted by third parties. Together with other Group staff functions, a group-wide ethics program embracing the Code of Conduct and other policies will be launched in 2008.

Safety net

Health and Safety key data
Number of work-related injuries1) Number of work-related injuries
1) Per 200,000 hours worked.

3.5 1,386

2.8 1,170

3.6 1,657

The number of work-related injuries in absolute terms at our facilities last year was 1,386. (GRI G3 indicator: LA7)
Factory accident in Hungary
We are saddened to report that on July 19th, 2007 an accident at our Nyregyhaza Factory in Hungary claimed the life of an Electrolux employee. The 54 year-old maintenance worker was repairing one of our automated top panel manufacturing lines. The safety system usually intact during operation had been intentionally deactivated to enable repair work, which was identied as one of the causes of the accident. This is the rst time an accident of this nature had occurred at the factory. Immediately after the accident, a crisis steering committee was convened by Jnos Takcs, head of operations for Electrolux Central Europe. Investigations were conducted by company representatives, and external technical and safety auditors. Crisis support for employees were also provided. Safety procedures and extra training for both maintenance and operating the automated production lines have been sharpened. The deceaseds partner was provided with both nancial and medical support.
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HR related indicators, p. 40 Includes diversity, remuneration to senior management, the Electrolux People Process.

Partners in change

Strong relationships with retailers lie at the heart of our business model. Sustainability is an important part of our dialogue with them. At times, we cooperate informally to impact consumer choices through communication. Increasingly, dealers stipulate formal commitment to performance standards.

Europe:

North America:

Committing to change

Magnus Yngen, Head of Major Appliances in Europe has seen growing engagement with sustainability among retailers. When I meet with leaders from retailers, the subject pops up with about 75% of those I visit.

An evolving agenda

Between 8590% of Electrolux sales in North America are conducted through a wide range of retailers. Electrolux works through approximately 1,000 primary customers. These include three key national chains, SEARS, Lowes and Best Buy, several regional dealers and a few hundred independent dealers.
Engagement among retailers
Magnus Yngen Executive Vice-President, Major Appliances Europe

Keith R. McLoughlin

Executive Vice-President, Major Appliances North America
In many ways, retailers have gone beyond compliance to focus on the opportunities for change that exist in the products they offer. I think that when it comes to sustainability, the main focus among retailers is to choose products that allow them to present themselves as proactive companies, says Yngen. Electrolux strives to be a trusted, credible partner in these regards. The best, most advanced retailers would nd a competent partner in Electrolux.
Growing awareness of environment and labour issues:
Its ultimately about delivering value, says Keith McLoughlin, Head of Electrolux Major Appliances in North America, as he describes the rising importance of sustainability in building relationships. Many retailers had already been focusing on doing the right thing from quality and societal standpoints. But there certainly has been an increase in dialogue in the last year. With some, sustainability has become a key strategy platform, and they are demonstrating this through their own brand of eco-products, or their own environmental trademark. In North America in 2007, a fairly substantial shift has occurred among consumers. The climate change debate has done a remarkably good job in raising awareness. And growing attention to the impact of globalization has put fuel on the re.

responsible sourcing avsnitt

Supplying change

Since 2004, supply chain Code of Conduct monitoring has been an integrated part of sourcing from China. As we rene our procedures, work conditions are improving amongst most suppliers but better detection also reveals more cases of non-conformance to resolve.
In 2007, 102 audits were conducted by Electrolux Code of Conduct specialists and 14 by external auditors worldwide. Our program placed particular focus on Asia. Following his 50th re-audit, Andrew Feng, Corporate Social Audit Manager within Electrolux Purchasing in China, drew two conclusions: the number of non-compliance cases was dramatically reduced by 38% but only seven out of 50 were in full compliance with our Code of Conduct. Our audit methodology has improved, which is why were nding more non-compliance by some suppliers than we did during initial audits, says Henrik Dahlstrm, Director of the Responsible Sourcing Program. While most categories show improvement, health and safety, child labor and working hours remain an issue in China. (See p. 28 and p. 29) Managing risk Responsible sourcing helps ensure that suppliers uphold the values enshrined in the Electrolux Code of Conduct and Environmental Policy. Supplier assessments take into account four areas of risk: 1. Geographical location (Asia, Latin America and Eastern Europe) 2. Extent of business with a supplier 3. Type of supplier relationship 4. Type of operation 2007 milestones Of ve objectives set in our 2006 Sustainability Report, four were achieved: Code of Conduct specialists are in place in China. Specialist teams in Eastern Europe and Latin America were approved by Group Management. Four purchaser training sessions were held in China and Thailand and one in Sweden. Follow-up audits were conducted in China with all active suppliers audited in 20052006.
Work in cooperation with Global Purchasing on our fth objective, the development of common procedures for Code of Conduct assessments, is ongoing. Our end goal is to introduce a methodology that includes all aspects of the purchasing organization. Achieving transparency and engagement along the supply chain is a long-term goal of Electrolux. Through training, we are helping suppliers foster a sense of ownership of the issues and facilitate sustained improvement.
Raising the bar Focus areas in 2008 include: Launch the program in Latin America and Eastern Europe Further develop our methodology and tools, including more detailed environmental requirements and criteria Internal training and capacity building within Purchasing and Quality organizations Introduce training sessions and other supporting activities for our suppliers outside the audit framework

Our Spennymoor Cooker plant closed in December, 2007. It is estimated that 90% of its employees will nd new jobs.
A total of SEK 43 million was invested in the Fredericia, Denmark closure. By February 2008, fewer than 15 of the 150 people who worked at Fredericia were jobless.
Electrolux manufacturing footprint by 2010
LCC, 60% Why keep plants in HCC? No net-present value case 20% Efcient and protable plant 10% Declining demand 10% HCC 40%
By 2010, Electrolux will have 60% of its plants in low-cost countries (LCC). The remaining 40% will be in high-cost countries (HCC) due to economic reasoning: the plant is efcient and protable; net-present value is negative for a transfer of production to LCC; or demand for the products being manufactured is declining.
Torsvik Spennymoor Fredericia Nuremberg

Juarez

Restructuring 2007
Plant closures and cutbacks Torsvik Fredericia Nuremberg Adelaide New plants Juarez, to open 2008 Authorized restructuring Spennymoor UK Cookers Mexico Washing machines Sweden Denmark Germany Australia Compact appliances Cookers Dishwashers, washing machines and dryers Dishwashers Adelaide
During 2007 Electrolux achieved on-target organic growth of 4% while continuing to restructure our manufacturing to ensure long-term competitiveness. Approximately 50% of our production now takes place in low-cost countries with access to growth markets, and we are approaching our goal of 60% by 2010. Restructuring makes sound economic sense. But Electrolux recognizes that closures in high-cost countries present tough challenges for the individuals and localities concerned. It must be handled with sensitivity, in partnership with all those affected. When a closure is considered, Electrolux implements its rigorous two-step process, says Carina Malmgren Heander, Head of Group Staff Human Resources. This engages labor unions, politicians and relevant government departments to explore all possible options. Where closure is conrmed, suitable retraining, employment search and compensation packages are brokered. On the plus side, restructuring offers economic benets to new employees and suppliers in low-cost economies and contributes to the community by promoting high social and environmental standards.
Carina Malmgren Heander Senior Vice-President, Human Resources and Organizational Development
Changing production patterns
At Spennymoor and Fredericia, employees and managers worked together during the investigation phase to explore ways to reduce the protability gap. When the decision was taken to close, retraining and job searching opportunities were offered to employees, alongside a nancial package. Good re-employment prospects in the local area contributed to open and friendly negotiations with the labor unions. An investigation has been announced in February 2008, into the competitiveness of two refrigerator factories in Italy Susegana and Florence.

our metrics

Economic highlights
Net sales increased to SEK 104,732m (103,848) Operating income rose by 5.7% in 2007, excluding items affecting comparability Operating income improved for all operations except for appliances in Europe Extra costs for new products launched adversely affected income for appliances in Europe Best results ever for appliances in Latin America Strong performance by oor-care operations worldwide Good growth in Asia/Pacic and strong improvement in results Solid performance by appliances in North America and Professional Products The dividend is SEK 4.25 (4.00) per share.

Key data 1)

SEKm, EURm, USDm, unless otherwise stated 2007 EURm 2007 USDm
Net sales and employees in 10 largest countries

SEKm Employees

Net sales Operating income Margin, % Income after nancial items Earnings per share, SEK, EUR, USD Dividend per share, SEK, EUR, USD Return on net assets, % Value creation Average number of employees Net debt/equity ratio Return on equity, %
1) Excluding items affecting comparability.
104,732 4,837 4.6 4,397 11.66 4.25 20.9 2,053 56,898 0.29 22.7
103,848 4,575 4.4 4,367 10.89 4.00 21.2 2,202 55,471 0.02 21.1

11,475 1.26 0.46 222

15,652 1.73 0.63 305
USA Brazil Germany Italy France UK Canada Australia Sweden Spain Other Total
29,571 7,158 7,020 5,109 4,950 4,577 4,488 3,814 2,927 30,161 104,732
10,648 6,754 2,147 8,036 1,466 1,122 1,420 2,144 3,19,244 56,898

Net sales1)

Operating income1)

Earnings per share2)

SEKm 140,000 105,000

SEKm 7,500

SEK 20.00 15.00 10.00
1) Continuing operations, excluding items affecting comparability. 2) Earnings per share for 2006 and 2007 refer to continuing operations, excluding items affecting comparability. 3) Average number of employees for continuing operations.

5,000 70,000 2,500 35,07

5.00 0

Direct economic value1)

Direct economic value

SEKm 2007 2006

Revenues Operating costs, 77% Employee wages and benets, 16% Payments to providers of capital, 2% Payments to government, 1% Economic value retained, 4% Economic value distributed Operating costs Employee wages and benets Payments to providers of capital) Payments to government Community investments

1) GRI G3 indicator: EC1

105,167

104,571

80,915 16,857 1,748 1,110 4,537
80,318 16,924 2,968 1,177 3,184
Not collated on Group level

Economic value retained

1) In addition, redemption of shares.
The direct economic value is dened as the net sales plus revenues from nancial investments and sales of assets.
Environmental performance indicators

DJSI World Index The only manufacturer of major household appliances to qualify, Electrolux is a constituent of the prestigious Dow Jones Sustainability World Index (DJSI). This places us within the top 10% of the 2,500 companies included in the Dow Jones Global Indexes with regard to long-term economic, environmental and social performance. Total assets under management in DJSI-based investment vehicles amount to 3.6 billion.
Sustainable Energy Europe In 2006, Electrolux received the Best Corporate Commitment award from the European Commission as part of its Sustainable Energy Europe campaign 2005-2008. The aim is to build public support in reaching European energy policy targets on renewable energy sources, energy efciency, clean transport and alternative fuels. Campaign partners include companies, NGOs and local, regional and national authorities. Electrolux is a partner in the campaign. Recognition in Sustainability Yearbook Electrolux received mention as a Gold Class Member, Sector Mover and Sector Leader in a yearly reference work The Sustainability Yearbook published by Sustainable Asset Management (SAM). SAM is among the worlds leading institutions specialising in sustainability investments and manages the foremost indexes on corporate sustainability, the Dow Jones Sustainability Indexes. As a SAM Gold Class company, Electrolux is recognized for achieving a score of 79% in SAMs evaluation of the Groups environmental and social performance a jump from 68% the previous year. Environmental performance was an area of particular strength. Since Electrolux demonstrated the greatest relative progress in its sector, the company was also awarded the title SAM Sector Mover. As announced in the third quarter of 2007, Electrolux was awarded Sector Leader and selected for inclusion as a constituent of the Dow Jones Sustainability World Index. SAM analyzed the sustainability performance of the top-scoring 15% of the 2,500 largest companies as ranked by the Dow Jones Global Indexes. See also p. 35
Socially responsible investors Several other socially responsible investment indices feature the Electrolux Group: FTSE4Good Series, UK. The FTSE4Good selection criteria hold that constituent companies must demonstrate environmental sustainability, positive relationships with stakeholders and universal human rights. Oekom Research, Germany. An advisor to investor and nancial service providers, Oekom research currently informs around 85 billion Euros in assets under management. Global Climate 100 Index, USA. A specialty index designed in partnership between KLD Research and Analytics and the Global Energy Network Institute (GENI) to promote investment in companies whose activities demonstrate the greatest potential for mitigating immediate and long-term causes of climate change.