STOCKHOLM, Sweden (AP) -- Shares in Swedish outdoor appliance maker Husqvarna AB fell more than 5 percent Tuesday, after the company warned of weak profit in the third quarter and said it would cut around 850 jobs.
The job cuts correspond to around 5 percent of Husqvarna's work force of 16,000 people.
The company said it expects operating profit for the third quarter to fall by 46 percent to 300 million kronor ($45 million) from 553 million kronor a year ago, mainly due to lower sales of its products.
"The decline refers primarily to consumer products for the mass market channels in North America and Europe, as well as to products for the construction industry," it said in a statement.
Shares in Husqvarna, which was spun off from Electrolux in 2006, fell 7.04 percent to 49.50 kronor ($7.37) in Stockholm.
The company said it would lay off around 300 employees in Huskvarna, southern Sweden and 550 more globally to save 300 million kronor ($45 million) a year.
However, the initial cost for implementing the job cuts would also be around 300 million kronor ($45 million), Husqvarna said. The layoffs will be implemented after negotiations with the relevant labor unions in autumn and the first quarter of 2009.
The company has production and sales facilities in more than 100 countries.