Husqvarna Group has announced it will further increase focus and efforts on its future premium product and service offerings under the core brands of Husqvarna and Gardena while decisive steps are taken to resolve the underperforming Consumer Brands Division.
The presence in certain consumer segments will be exited. As a consequence of the future direction, the Consumer Brands division will be dissolved into the Husqvarna and Gardena divisions.
However, responding to Service Dealer's enquiry as to how this may affect UK dealers, Glen Instone, Vice President Global Sales & Service, Husqvarna Division, said, "This restructuring will have very little impact on the UK operations. The Husqvarna division in the UK serving the servicing dealers with the Husqvarna Brand is unaffected.
"The Consumer Brands Division will be folded into the Gardena operations within our EMEA and APAC region. The UK Consumer brands offering remains strong - the Flymo Brand has a strong heritage in the UK and will see this as an attractive brand going forward."
The international statement issued by the Group continued saying Husqvarna Group will gradually exit from low price point product segments and brands, particularly in petrol powered walk-behind lawnmowers and garden tractors. The extent of the exits and associated adjustments to the manufacturing footprint and brand portfolio are being reviewed. The changes will be realised in two steps, as customer commitments for the 2019 season will be honoured. The second step for 2020 is being reviewed. The net sales impact for 2019 is close to SEK 2 billion but will have a favourable impact on the Group’s operating margin.
“We will focus our remaining consumer forest and garden operations in North America to areas where we have proven to bring customer value, such as in handheld products, premium garden tractors, zero-turn lawnmowers and particularly robotic lawnmowers. The reorganisation will facilitate reallocation of resources towards these offerings that have greatest potential for growth and profitability”, said Kai Wärn, President and CEO of Husqvarna Group.
“Exiting non-core segments and brands is a decisive step to reduce complexity in the Group which will enable us to put even stronger focus on our high margin business in Husqvarna and Gardena. As a consequence, we will dissolve our Consumer Brands Division into the Husqvarna and Gardena divisions”, Kai continued.
The North American operations of the Consumer Brands Division will be folded into the Husqvarna Division and the European and Asian operations will fold into the Gardena Division. Such changes will start immediately and will be fully implemented by year-end. Accordingly, the external financial segment reporting will be changed as of January 1, 2019. The goodwill is not expected to be affected.
Additional information and details on the outcome of the review, including onetime items that will impact both income statement and cash flow for 2018, are expected to be communicated latest at the Group’s interim report for the third quarter 2018 on October 20.
The Construction division is not affected by the changes.
