* Q1 op profit 778 million crowns versus f'cast 779 million
* Market uncertainty remains, but sales rose at end of Q1
* Says inventories of products slightly lower vs year-ago
* Shares up 1.7 pct to 57.75 crowns
(Adds analyst comment, share price, detail)
By Katarina Gustafsson and Niklas Pollard
STOCKHOLM, April 27 Garden and construction tool
maker Husqvarna AB (HUSQb.ST) forecast flat sales year-on-year
in the second quarter as lingering market uncertainty and
retailer caution held back growth.
Demand for gardening products was pummelled by the economic
downturn last year and retailers on both sides of the Atlantic
have been careful about scaling up inventories amid lingering
doubts over the strength of the recovery in consumer spending.
"In light of the late start to the season and the
expectation of (better retail sales)... it is estimated that
Husqvarna's sales in the second quarter will be in line with the
second quarter of 2009 despite reduced listings in North
America," the company said on Tuesday.
Shares in Husqvarna were up 1.7 percent at 57.75 crowns by
1118 GMT, virtually unchanged from before the report. They were
outperforming a 0.75 percent decline in the Stockholm bourse's
blue chip index .OMXS30.
"In terms of the guidance for Q2, I think it was a bit
light. It was better than consensus estimates, but I had
expected a little bit more," said an analyst who asked not to be
Husqvarna, which makes lawn mowers, chain saws and other
garden equipment as well as diamond-tipped tools for the
construction industry, has rushed to cut costs in the face of
the downturn, shedding more than 1,000 jobs since 2008.
The group posted operating profit of 778 million crowns
($108.3 million) versus a year-ago 786 million and a mean
forecast of 779 million seen in a Reuters poll of analysts.
However, the results were dented by a charge of 50 million
crowns for settlement of a U.S. lawsuit, Husqvarna said.
Analysts had expected non-recurring costs of on average 22
million crowns in the period.
"The year had a slow start due to an unusually long and cold
winter in several markets," the company said.
"The weather affected (sales to retailers) ... for the
garden season and activities in the construction market.
However, sales picked up and increased considerably towards the
end of the quarter."
The group, spun out of white goods group Electrolux
(ELUXb.ST) in 2006, said sales fell to 9.1 billion crowns from
11.2 billion a year ago, lagging the 9.5 billion seen by
Husqvarna said it would book a 50 million crown charge in
the second quarter for the closing of a plant for construction
gear in Greece and restructuring in Belgium, measures that were
seen generating annual savings of 20 million from 2012.
(Editing by David Holmes, Mike Nesbit)
($1=7.187 Swedish Crown)