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Keith McLoughlin, President and CEO Tomas Eliasson, CFO Capital Markets Day Stockholm, November 13, 2013

Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

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Electrolux today at its capital markets day presents a status update on the Group’s strategy, focusing on actions to drive profitable growth and further improve operational excellence. President and CEO Keith McLoughlin and members of senior management will hold presentations, including an in-depth view of the operations in North America.

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Page 1: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Keith McLoughlin, President and CEO

Tomas Eliasson, CFO

Capital Markets Day Stockholm, November 13, 2013

Page 2: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

SESSION 1

09:00 – 10:00 Business update and strategy Keith McLoughlin, President and CEO

Getting behind the numbers Tomas Eliasson, CFO

10:00 – 10:30 Innovation & Modularization Jan Brockmann, Chief Technology Officer

10:30 – 10:45 Break

SESSION 2

10:45 – 11:30 European Business Jonas Samuelson, Head of Major Appliances Europe, Middle East and Africa

11:30 – 12:00 Operational Excellence Frank Wagner, SVP Global Manufacturing Operations

SESSION 3

12:00 – 12:20 Q&A

12:20 – 13:00 Buffet lunch

SESSION 4

13:00 – 14:30 North American Business Jack Truong, Head of Major Appliances, North America

- John Weinstock, VP, Marketing Major Appliances, North America

- Mark Chambers, SVP, Sales Major Appliances, North America

- Daren Couture, SVP, Operations Major Appliances, North America

SESSION 5 Q&A and Wrap-up

14:30 – 15:00 Summary and Conclusion Keith McLoughlin, President and CEO and Tomas Eliasson, CFO

Capital Markets Day,

November 13, 2013

Page 3: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

3

The transformation

is paying off Business update

Page 4: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

What did we say about 2013?

4

Comments after

Q4 2012 FY 2013 Comments

Market volumes Slightly

positive Growth in emerging markets and North America. Europe continues to be weak.

Price/Mix Slightly

positive

Prices maintained in NA.

Europe continuous to be weak. LA positive.

Raw-material costs Positive Steel: Positive

Plastics: Negative

R&D and marketing Higher Intensive launch period in 2013. Increased marketing spend in North America

and China.

Cost savings ~ SEK 1 bn Global operations, overhead reduction and manufacturing footprint.

Consolidation of

NA cooking ~SEK 300m

Costs for running two facilities when moving production from L’Assomption in

Canada to Memphis in US

Logistics and

warehousing Higher Overall increase and extra cost from entering new distribution channels in NA.

Status

Page 5: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Q3 Highlights

5

(SEKm) Q3 2012 Q3 2013

Sales 27,171 27,258

EBIT* 1,423 1,075

Margin* 5.2 3.9

* Excluding items affecting comparability. Non-recurring items are excluded in all figures.

Continued good growth

+4.9% organic growth

North America, Asia Pacific, Small Appliances

and Professional show strong growth

Latin America slowing down

EMEA flat – moving sideways

Restructuring program launched, mainly EMEA

Solid free cash flow

0,0%

1,0%

2,0%

3,0%

4,0%

5,0%

6,0%

2011 2012 2013

EBIT%

Page 6: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

6

The transformation

is paying off What’s behind the

Electrolux strategy?

Page 7: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Total Shareholder Return

Total return Electrolux B

(Annual return)

SIX index retun

(Annual return)

1 year 42% 33%

5 year 19% 8%

10 year 15% 14%

15 year 10% 7%

20 year 16% 13%

25 year 13% 12%

7 Note: Calculated from year-end 2012

Page 8: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Historic Shareholder Return

8 Source: BCG, 1991-2011

Cash-flow productivity

Top line

Margin

Multiple

13%

1%

0.5%

0.5%

TSR 15% CAGR

Page 9: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Key Financial Targets

9

EBIT margin

>6%

Capital turnover

4x

ROIC

>20%

Growth

4%

Page 10: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

10

The transformation

is paying off Where we are

Page 11: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

A Consumer Marketing Driven Company

11

Consumer

marketing

driven

company

Manufacturing

engineering

company

Growth

Innovation

Operational

Excellence

People

Page 12: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Our Competitive Advantages

Consumer insight Design Professional legacy Glocal presence

Wide product

range

People & culture

Sustainability

leadership

Scandinavian

heritage

Page 13: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Major Appliances

Core

Emerging

US

Western Europe

Australia

Eastern Europe

Brazil

Value market share

Page 14: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Floor Care

Value market share

US

Western Europe

Australia

South East Asia

Brazil

Core

Emerging

Eastern Europe

Page 15: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Brands

15

Eight

strategic

brands

Page 16: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Dual Business Model

16

Focus on differentiated

branded product offer

Low cost,

lean go-to-market

Market set price

Sharp customer focus Shared global strength Premium

Mass

Benefits of scale in:

• Manufacturing

• R&D

• Purchasing

• Modularization

• Common processes

and shared services

Page 17: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Sustainability Leadership

Page 18: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Values and Foundation

18

Drive for Results Passion for Innovation Customer Obsession Values

Foundation Ethics & Integrity Respect & Diversity Safety & Sustainability

Page 19: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

19

The transformation

is paying off Where we are going

Page 20: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Vision

20

...our customers ...our shareholders

As measured by...

...our employees

To be the best appliance company in the world Our Vision

Page 21: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Mission and Value Creation Potential

21

EBIT margin

>6%

Capital turnover

4x

ROIC

>20%

Growth

4%

Page 22: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

22

Four Strategic Pillars

Profitable

Growth

Operational

Excellence

Innovation – Products and Services

– Brands and Design

– Sustainability

People & Leadership

Page 23: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

23

The transformation

is paying off Profitable Growth

Page 24: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Sales Growth, Currency Adjusted

24 Note: Currency adjusted growth, rolling 12 months

90 000

95 000

100 000

105 000

110 000

-2,0%

-1,0%

0,0%

1,0%

2,0%

3,0%

4,0%

5,0%

6,0%

7,0%

8,0%

2011 2012 2013

Sale

s S

EK

m

Gro

wth

%

Organic growth % Acquired growth % Sales in fixed currencies, SEKm

Page 25: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Exposure to Emerging Markets

25

50

40

30

20

10

0

2006

36%

2013 YTD

15%

Emerging markets

% of Group sales

Page 26: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Revenue Diversification

26

Today Growth 2017

Mature

markets

64%

Emerging markets

36%

1-2%

7-10%

Mature

markets

50%

Emerging markets

~50%

Page 27: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

27

The transformation

is paying off Innovation

Page 28: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Innovation Triangle

28

Marketing Design

R&D

Develop best-in-class

products

1

70% Preference Rule 2

Reduce Time to Market 30% 3

Continue investing in

premium brands

4

Page 29: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

29

Electrolux Grand Cuisine

Page 30: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Electrolux Gourmet Range

30

• Partnership with Poggenpohl

• Super-premium segment

• Available through kitchen retailers only

Page 31: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

UltraPower Ergorapido

New Floor Care Products 2013

31

UltraOne UltraSilencer UltraCaptic

Rapido

Over 40% of vacuum cleaner

sales expected from newly

launched products in 2014 40%

Page 32: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

32

The transformation

is paying off UltraOne

Commercial

Page 33: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

China Launch

Page 34: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Latin America

34

Mini Silent Washer The Blossom Refrigerator

Page 35: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

35

The transformation

is paying off Mini Silent Washer

Commercial

Page 36: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Brand Architecture

36

EU NA LA AP

Regional brands

PREMIUM

MASS

MARKET Regional brands

Page 37: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

360 Consumer Experience

Pre-purchase Gathering inspiration

and exploring possibilities

Post-purchase Setting up the appliance,

using and maintaining it

At-purchase Understanding the range

of potential options and

making a final choice

LIVE

SHOP

Page 38: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

38

The transformation

is paying off Electrolux Commercial

Page 39: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

39

The transformation

is paying off Operational Excellence

Page 40: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Operational Excellence

40

Overhead costs

Global Operations

Three main areas

Manufacturing

footprint

Page 41: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Timeline LCC Production

Percentage of Capacity in LCC

28% 31%

39%

43%

51% 53% 55%

62% 65% 66%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

41

Page 42: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

New Production Centers

• Reducing global manufacturing costs

• Supporting strategic growth areas

South America

North America

Middle East

Africa

Eastern Europe Asia

42

Page 43: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

43

Four Strategic Pillars

Profitable

Growth

Operational

Excellence

Innovation – Products and Services

– Brands and Design

– Sustainability

People & Leadership

Page 44: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

44

The transformation

is paying off Outlook

Page 45: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

2014 Expectations

45

Q4 FY 2014 Comments

Market volumes Slightly

Positive

Slightly

Positive

Growth in North America and Asia Pacific, Europe flat, slowdown

expected in Brazil.

Price/Mix Slightly

Positive

Slightly

Positive

Positive Price/Mix: North America, Latin America and Australia.

Negative Price: Europe.

Negative Country Mix: Asia/Pacific.

Raw-material costs Slightly positive Flat In the range of -100 to +100.

R&D and Marketing Slightly

higher

Slightly

higher Higher marketing spend in Asia and higher costs for Global R&D.

Cost savings ~SEK 250m ~ SEK 1bn Includes global operations, overhead reduction and manufacturing

footprint.

Logistics, warehousing

etc. Higher Flattening Some carry-over effect in 2014.

Page 46: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO
Page 47: Electrolux Capital Markets Day 2013 - Presentation Keith McLoughlin, CEO

Factors affecting forward-looking statements

47

Factors affecting forward-looking statements

This presentation 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.