Garden equipment maker Husqvarna AB posted a bigger than expected rise in first-quarter profit, overcoming earlier output problems in the United States where demand spiked amid warm spring weather and an improving wider economy.
The world's biggest maker of outdoor power equipment said on Thursday it expected more growth in the United States, where lawn mowers in particular sold well in the quarter, while the outlook for Europe was more uncertain.
Chief Executive Hans Linnarson told Reuters U.S. demand had continued upwards in the second quarter. "We see no signs the trend from Q1 would slow."
Operating profit grew to 915 million Swedish crowns ($135.8 million) from a year-earlier 662 million, against an average forecast in a Reuters poll for 857 million.
UBS analyst David Hallden said: "Sales clearly overshoot in the U.S. It is a recovery we have been anticipating and it's nice to see this coming through." He added: "It's (also) nice to see they manage to keep up margins in Europe."
Linnarson, promoted to the top position in December after a tough year for the company which included two profit warnings, said new products such as robotic mowers and upgraded ride-on mowers were well received in the market.
Last year, Husqvarna was plagued by production problems at a new plant in the United States, but Linnarson told Reuters all Husqvarna's factories were now doing very well.
"The measures we took in the second half (of 2011) have had effect and we have managed to meet clients' expectations."
The Americas business swung to a forecast-matching profit of 81 million crowns in the first quarter on 23 percent sales growth, gaining market share.
Husqvarna's Europe and Asia-Pacific division, slightly bigger by sales, made a profit of 883 million crowns, above a forecast 798 million, on a modest 2 percent sales growth amid southern European consumer gloom.
"In the U.S. market, the near-term outlook is for the stronger demand year-on-year to continue, while the demand outlook for the European market is more difficult to assess," Linnarson said.