A sharp shock for Electrolux as profits falter

The world's number two home appliances maker Electrolux today shocked the markets with a poor set of profit figures and warned the rest of the year would remain difficult.

Electrolux, hit by rising raw materials costs, has said it wants to raise prices, but like larger rival Whirlpool and consumer electronics giant Philips, which reported a loss on Monday, has faced soft consumer demand.

The company reported core earnings of 745 million Swedish crowns versus 911 million crowns forecast by City analysts. A year ago it made 1.5 billion crowns.

"Even though sequentially better, we do not expect earnings in the second half of the year to reach the level achieved in the second half of 2010," the company said in a statement.