Stockholm-based Husqvarna outlined changes to where it makes certain products, and said those moves will likely mean fewer employees. As part of its third quarter update on Wednesday, the company said manufacturing for selected Husqvarna-branded battery handheld items will shift to internal plants and outside partners in Asia.
Asked about jobs after the report, Chief Executive Officer Glen Instone was blunt: "Will people be affected? Yes," while adding, "But it's too early to speculate on how many, there are many moving parts." The quarter lagged forecasts, with Europe weak as widespread drought and softer consumer demand hit results. The Forest & Garden division posted a 10% organic sales decline.
Shares fell as much as 11% in Stockholm, their lowest since 2012.
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The company is moving into a new seasonal mix "more into chainsaws, handheld products and construction," which Instone said could bring "some different challenges in the fourth quarter." For investors, the combination of a Europe-heavy demand slump, an 11% share drop to 2012 levels, and a production shift toward Asia sets up a transition period to watch on margins, inventories, and the pace of those manufacturing changes.
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