STOCKHOLM -- Appliance maker Electrolux AB reported a sharp rise in second-quarter net profit Thursday, after restructuring costs weighed on year-earlier results, and said the U.S. market was showing early signs of recovery.
Net profit jumped to 658 million Swedish kronor ($84.8 million) from 99 million kronor a year earlier, when it booked restructuring costs of 539 million kronor. Savings initiatives and lower raw-material costs helped push up its bottom line.
Higher prices for Electrolux's products and the weakness of the Swedish krona against the dollar and euro, meanwhile, helped lift revenue 7.4% to 27.48 billion kronor from 25.59 billion kronor.
The company reaped benefits from a shift in production to lower-cost countries, where it has increased efficiencies and lowered its purchasing and product costs. Electrolux launched a restructuring program in 2004 that aims to save 3 billion kronor in annual costs. In December, it said it would lay off more than 3,000 staff, or about 5% of its work force.
Electrolux, known for its vacuums, shown on display in Sweden, is seeing signs of a market bottom in North America.
Most of the company's main markets for appliances continued to show a decline in the second quarter of 2009, Electrolux said.
"There are no indications of an immediate improvement in any of the group's main markets, and, therefore, market demand for appliances around the world is expected to decline further in 2009," the company said in a statement.
Still, Electrolux said it had gained market share in North America, Latin America and Australia.
"In North America we see certain early signs that we are beginning to reach the bottom," Chief Executive Hans Straaberg said in a statement.
Even though the number of refrigerators, dishwashers, vacuum cleaners and other products the company delivered in North America fell 14% in the second quarter, the decline was an improvement on the 16% drop recorded in the first quarter.
Electrolux -- one of the world's largest manufacturers of household appliances after Whirlpool Corp. -- owns the Electrolux, AEG-Electrolux, Zanussi, Eureka and Frigidaire brands.
Shipments to North America have fallen for 12 consecutive quarters, and in Europe for six quarters. The two markets account for almost three-quarters of Electrolux's sales.
The Swedish appliance maker's cautiously optimistic comments on the U.S. offer further evidence that the worst of the recession in the world's biggest economy might be over. That sentiment was echoed by Finland's handset maker Nokia Corp., which Thursday said a slump in demand appeared to "bottoming out."
Investors cheered the results, despite the cautious outlook, and shares were up 9.4% in afternoon trading in Stockholm. The value of the stock has more than doubled in the past six months to trade at its highest level since October 2007.
Write to Ian Edmondson at ian.edmondson@dowjones.com
Printed in The Wall Street Journal, page B4