* Q2 op profit 1.04 bln SEK, in line with forecasts
* Sees stronger U.S. demand, expects better H2 for Europe
* Shares rise 5.0 percent
* Sweden's Husqvarna also upbeat on North America
By Mia Shanley and Sven Nordenstam
STOCKHOLM, July 19 Home appliances maker
Electrolux forecast a rebound in demand for its
products in crisis-hit Europe in 2014 and raised its outlook for
the United States this year as a housing recovery takes hold.
The Swedish company, second only to U.S. rival Whirlpool
in household appliances, slashed costs and boosted its
presence in emerging markets as it waited for a turnaround in
its dominant U.S. and European markets.
Reporting second-quarter earnings right in line with analyst
forecasts, the white goods giant was more bullish about
prospects in North America and said its European markets should
improve in the second half of the year.
"Looking ahead to next year and beyond, we expect demand in
Europe to rebound and in combination with our measures in the
region, earnings will recover," the company said in a statement.
Shares in the firm rose 5.0 percent by 0930 GMT.
It reported core operating earnings of 1.04 billion Swedish
crowns ($158 million) in the second quarter, down from the
comparable 1.11 billion in the same period of 2012 due in part
to currency effects, and in line with a Reuters poll.
"The margins in North America (of 7.8 percent, up from 5.7
in 2012) and the fact that there was actually a positive
development in market volumes in Europe are the positive factors
in this report," said Johan Eliason, analyst at Kepler
"That indicates a turnaround in Europe is not too far away."
Overall sales were flat at 27.8 billion crowns. Electrolux
said total industry shipments of core appliances in Europe rose
one percent in the quarter - the first rise in six quarters.
FRIDGES TO COFFEE MAKERS
Electrolux, which makes machines ranging from espresso
coffee makers to cookers and owns brands including Frigidaire,
AEG and Zanussi, said its U.S. customers had turned more
optimistic thanks to a stronger housing market.
It now sees U.S. demand for appliances rising 5 to 7 percent
in 2013, up from 3 to 5 percent in its previous outlook.
Chief Executive Keith McLoughlin also said Europe's darkest
days appeared to be behind it.
"While southern Europe continues to lag, there are some
positive trends in Germany, the Nordics in particular and the
UK," he told Reuters.
"Based on our numbers and what we see in the appliances
world, you could conclude that Europe does seem to appear to
have hit the bottom."
Europe and North America each make up about one-third of
Electrolux's revenues, followed by Latin America at 20 percent
and Asia-Pacific at 8 percent.
Appliance makers have struggled with tepid demand in mature
markets, forcing them to rely more on still-growing markets, and
have been shifting production from high-wage countries to
Swedish outdoor equipment maker Husqvarna was
also upbeat about the outlook for North America, though it was
cautious about Europe as it reported a slightly deeper than
expected fall in second quarter earnings on Friday.
On Thursday, Moody's Investors Service eased the threat of a
cut to United States sovereign ratings, raising the outlook to
stable from negative, citing steady growth despite reduced
Since the start of 2012, Whirlpool's share price had gained
17.3 percent versus 9.0 percent for Electrolux.
Whirlpool has a relative advantage in being more exposed to
the world's biggest economy, which accounts for half of its
sales versus 30 percent for Electrolux.