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News Release
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| Whirlpool Corporation Reports Fourth-Quarter and Full-Year 2009 Results |
--Fourth-quarter revenue increases 13 percent --Strong improvement in operating profit --Company generates record free cash flow of $1.1 billion in 2009 BENTON HARBOR, Mich., Feb 02, 2010 /PRNewswire via COMTEX/ -- Whirlpool Corporation (NYSE: WHR) announced today that fourth-quarter net earnings rose 111 percent to $95 million, or $1.24 per diluted share, compared to $44 million, or $0.60 per diluted share reported during the same period last year. Fourth-quarter results included an expense of $46 million, or $0.40 per share after tax, due to an accrual related to a previously disclosed legal action pertaining to a collection dispute. Sales of $4.9 billion increased 13 percent from the $4.3 billion reported in the fourth quarter of 2008. Excluding the impact of foreign exchange translation, the company's fourth-quarter sales increased approximately 5 percent. Fourth-quarter operating profit totaled $199 million compared with $10 million in the prior year. Results were favorably impacted by cost reduction and productivity initiatives and increased sales volume. These favorable factors were partially offset by lower price/mix. Full-year 2009 net earnings were $4.34 per diluted share compared to $5.50 per diluted share reported for 2008. The company reported annual net sales of $17.1 billion, a decrease of 10 percent from the prior year. Excluding the impact of foreign currency translation, sales declined approximately 6 percent from the prior year. "In 2009, we significantly improved our global cost structure and operating performance despite a substantial decline in global demand levels," said Jeff M. Fettig, chairman and chief executive officer of Whirlpool Corporation. "In addition, we generated record free cash flow and strengthened our financial position. I am pleased with our execution in this challenging environment, and we look to build upon our progress in 2010." Whirlpool generated free cash flow** of $1.1 billion during 2009 compared with $(0.1) billion during 2008. For the full-year 2009, the company reported cash flow from operations of more than $1.5 billion. Working capital, particularly due to reduced inventory balances, was a significant source of cash flow during the year. FOURTH-QUARTER REGIONAL REVIEW Whirlpool North America Fourth-quarter sales of $2.6 billion increased 4 percent from the prior year, while North American unit shipments increased 8 percent. U.S. industry unit shipments of major appliances (T7)* increased 6 percent during the fourth quarter. The North America region reported operating profit of $136 million compared to a loss of $(20) million in the previous year. The improvement was primarily the result of cost reduction, productivity initiatives and increased sales volume. These factors were partially offset by lower product price/mix. Based on the current economic outlook, the company expects full-year 2010 U.S. industry unit shipments to increase between 2 percent and 4 percent. Whirlpool Europe Whirlpool Europe reported fourth-quarter sales of $956 million, a 2 percent increase from the prior year. Excluding the effects of currency, sales declined approximately 9 percent. Overall industry unit demand during the quarter declined approximately 8 percent from the prior year. The region reported an operating profit of $19 million during the fourth quarter compared with $2 million reported in the previous-year period. Results were favorably impacted by lower costs and higher price/mix. These factors were partially offset by lower volume. The company expects full-year 2010 industry unit shipments to be approximately equal to 2009 levels. Whirlpool Latin America Fourth-quarter net sales totaled $1.2 billion, an increase of 52 percent from the prior year. Excluding currency translation, sales increased approximately 28 percent. Operating profit totaled $138 million in the fourth quarter compared with $110 million in the prior year. The improvement in profitability is primarily related to higher sales volumes, higher productivity and favorable foreign currency fluctuations. These items were partially offset by lower monetization levels of certain tax credits and lower price/mix. The company currently anticipates full-year 2010 Brazilian appliance shipments will increase 5 percent to 10 percent compared to the previous year. Whirlpool Asia Whirlpool Asia reported fourth-quarter sales of $188 million, increasing 34 percent from the prior year. Excluding the impact of currency, sales increased 27 percent. Operating profit during the quarter totaled $6 million, an increase of $3 million from the prior year. The year-over-year increase in operating profit was mainly attributable to higher unit volume and was partially offset by lower price/mix. The company anticipates full-year 2010 industry unit shipments in Asia to be up 3 percent to 5 percent compared to 2009 levels. Outlook For the full-year 2010, Whirlpool Corporation expects earnings per diluted share between $6.50 and $7.00. For the full year, the company expects to generate free cash flow** of approximately $400 to $500 million. The company's earnings and free cash flow projections are based upon current economic forecasts and business plans. "We have positioned the company to deliver strong earnings growth despite a continued challenging economic backdrop in the developed economies," said Fettig. "Cost reduction, cash flow generation and balanced market execution remain key operating priorities. These efforts combined with our global brand portfolio, innovative product offerings and the value of innovation we bring to consumers will provide us with growth opportunities throughout the year." * T7 refers to the following household appliance categories: washers, dryers, refrigerators, freezers, dishwashers, ranges and compactors. ** A reconciliation of free cash flow, a non-GAAP financial measure, to cash provided by operations appears below under the heading "Cash Flow Reconciliation." FOURTH-QUARTER 2009 PRODUCT LAUNCHES
FOURTH-QUARTER 2009 AWARDS AND ACCOMPLISHMENTS
Cash Flow Reconciliation** The table below reconciles actual 2009 and 2008 and projected 2010 cash provided by operations determined in accordance with generally accepted accounting principles (GAAP) in the United States to free cash flow, a non-GAAP measure. Management believes that free cash flow provides shareholders with a relevant measure of liquidity and a useful basis for assessing the company's ability to fund its activities and obligations. There are limitations to using non-GAAP financial measures, including the difficulty associated with comparing companies that use similarly named non-GAAP measures whose calculations may differ from the company's calculations. As defined by the company, free cash flow is cash provided by operations after capital expenditures and proceeds from the sale of assets/businesses. Twelve Months Ended
December 31
--------------------
(millions of dollars) 2009 2008 2010 Outlook
-------------------- ------------
Cash (used in) /provided by
operations $1,550 $327 $925 -1,025
Capital expenditures (541) (547) (525 - 575)
Proceeds from sale of assets 77 119 0 - 50
------ ------ -----------
Free cash flow $1,086 $(101) $400 - 500
====== ====== ===========
About Whirlpool Corporation Whirlpool Corporation is the world's leading manufacturer and marketer of major home appliances, with annual sales of approximately $17 billion in 2009, 67,000 employees, and 67 manufacturing and technology research centers around the world. The company markets Whirlpool, Maytag, KitchenAid, Jenn-Air, Amana, Brastemp, Consul, Bauknecht and other major brand names to consumers in nearly every country around the world. Additional information about the company can be found at http://www.whirlpoolcorp.com/. Whirlpool Additional Information: This document contains forward-looking statements about Whirlpool Corporation and its consolidated subsidiaries ("Whirlpool") that speak only as of this date. Whirlpool disclaims any obligation to update these statements. Forward-looking statements in this document may include, but are not limited to, statements regarding expected earnings per share, cash flow, productivity and material and oil-related prices. Many risks, contingencies and uncertainties could cause actual results to differ materially from Whirlpool's forward-looking statements. Among these factors are: (1) changes in economic conditions which affect demand for our products, including the strength of the building industry and the level of interest rates; (2) the effects of the global economic crisis on our customers, suppliers and the availability of credit; (3) Whirlpool's ability to continue its relationship with significant trade customers, and the ability of these trade customers to maintain or increase market share; (4) intense competition in the home appliance industry reflecting the impact of both new and established global competitors, including Asian and European manufacturers; (5) the ability of Whirlpool to manage foreign currency fluctuations; (6) product liability and product recall costs; (7) litigation and legal compliance risks; (8) the ability of Whirlpool to achieve its business plans, productivity improvements, cost control, leveraging of its global operating platform, and acceleration of the rate of innovation; (9) inventory and other asset risk; (10) fluctuations in the cost of key materials (including steel, oil, plastic, resins, copper and aluminum) and components and the ability of Whirlpool to offset cost increases; (11) the ability of suppliers of critical parts, components and manufacturing equipment to deliver sufficient quantities to Whirlpool in a timely and cost-effective manner; (12) health care cost trends, regulatory changes and variations between results and estimates that could increase future funding obligations for pension and other postretirement benefit plans; (13) Whirlpool's ability to obtain and protect intellectual property rights; (14) information technology system failures and data security breaches (15) global, political and/or economic uncertainty and disruptions, especially in Whirlpool's significant geographic regions, including uncertainty and disruptions arising from natural disasters or terrorist attacks; (16) the effects of governmental investigations or related actions by third parties; (17) the impact of labor relations; (18) our ability to attract, develop and retain executives and other qualified employees; (19) changes in the legal and regulatory environment, including environmental and health and safety regulations. Additional information concerning these and other factors can be found in Whirlpool Corporation's filings with the Securities and Exchange Commission, including the most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. WHIRLPOOL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
Periods Ended December 31
(Millions of dollars, except per share data)
Three Months Ended Twelve Months Ended
----------------------- ---------------------
(Unaudited) (Unaudited) (Unaudited)
2009 2008 2009 2008
---------- ---------- ----------- -------
Net sales $4,864 $4,315 $17,099 $18,907
Expenses
Cost of products sold 4,176 3,842 14,713 16,383
Selling, general
and administrative
(exclusive of
intangible amortization) 427 379 1,544 1,798
Intangible amortization 7 7 28 28
Restructuring costs 55 77 126 149
----- ----- ----- -----
Operating profit 199 10 688 549
Other income (expense)
Interest and sundry income
(expense) (65) (66) (175) (100)
Interest expense (41) (53) (219) (203)
----- ----- ----- -----
Earnings before income
taxes and other items 93 (109) 294 246
Income tax benefit (10) (160) (61) (201)
----- ----- ----- -----
Earnings before
equity earnings 103 51 355 447
Equity in loss of
affiliated companies (1) - (1) -
----- ----- ----- -----
Net earnings 102 51 354 447
Less: Net earnings
available to
noncontrolling
interests (7) (7) (26) (29)
----- ----- ----- -----
Net earnings available to
Whirlpool common
stockholders $95 $44 $328 $418
===== ===== ===== =====
Per share of common stock
Basic net earnings
available to Whirlpool
common stockholders $1.26 $0.60 $4.39 $5.57
===== ===== ===== =====
Diluted net earnings
available to Whirlpool
common stockholders $1.24 $0.60 $4.34 $5.50
===== ===== ===== =====
Dividends $0.43 $0.43 $1.72 $1.72
===== ===== ===== =====
Weighted average shares
outstanding (in millions)
Basic 75.1 74.1 74.6 75.1
Diluted 76.4 74.7 75.6 76.0
WHIRLPOOL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Millions of dollars, except per share data)
(Unaudited)
December 31, December 31,
2009 2008
------------ ------------
Assets
Current assets
Cash and equivalents $1,380 $146
Accounts receivable, net of allowance for
uncollectible accounts of $76 and $66 at
December 31, 2009 and December 31, 2008,
respectively 2,500 2,103
Inventories 2,197 2,591
Prepaid expenses 99 110
Deferred income taxes 295 580
Other current assets 554 514
----- -----
Total current assets 7,025 6,044
----- -----
Other assets
Goodwill, net 1,729 1,728
Other intangibles, net of accumulated
amortization of $132 and $96 at
December 31, 2009 and December 31, 2008,
respectively 1,796 1,821
Other assets 1,427 954
----- -----
Total other assets 4,952 4,503
----- -----
Property, plant and equipment
Land 77 74
Buildings 1,207 1,186
Machinery and equipment 8,193 7,549
Accumulated depreciation (6,360) (5,824)
------- -------
Total property, plant and equipment 3,117 2,985
------- -------
Total assets $15,094 $13,532
======= =======
Liabilities and stockholders' equity
Current liabilities
Accounts payable $3,308 $2,805
Accrued expenses 632 530
Accrued advertising and promotions 475 440
Employee compensation 501 306
Notes payable 23 393
Current maturities of long-term debt 378 202
Other current liabilities 624 887
----- ------
Total current liabilities 5,941 5,563
----- ------
Noncurrent liabilities
Long-term debt 2,502 2,002
Pension benefits 1,557 1,505
Postretirement benefits 693 822
Other liabilities 641 567
----- -----
Total noncurrent liabilities 5,393 4,896
----- -----
Commitments and contingencies
Stockholders' equity
Common stock, $1 par value, 250 million shares
authorized, 105 million and 104 million shares
issued at December 31, 2009 and
December 31, 2008, respectively, 75 million
and 73 million shares outstanding at
December 31, 2009 and December 31, 2008,
respectively 105 104
Additional paid-in capital 2,067 2,033
Retained earnings 4,193 3,993
Accumulated other comprehensive income (loss) (868) (1,259)
Treasury stock, 30 million shares and 31 million
shares at December 31, 2009 and
December 31, 2008, respectively (1,833) (1,865)
------ ------
Total Whirlpool stockholders' equity 3,664 3,006
------ ------
Noncontrolling interests 96 67
------ ------
Total equity 3,760 3,073
------- -------
Total liabilities and stockholders' equity $15,094 $13,532
======= =======
WHIRLPOOL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended December 31
(Millions of dollars)
(Unaudited)
2009 2008
----------- ------
Operating activities
Net earnings $354 $447
Adjustments to reconcile net earnings to cash provided
by operating activities:
Depreciation and amortization 525 597
Curtailment gain (92) -
Gain on disposition of assets (4) (60)
(Decrease) increase in LIFO inventory reserve (41) 42
Equity in losses of affiliated companies,
less dividends received 1 -
Changes in assets and liabilities:
Accounts receivable (286) 300
Inventories 578 (174)
Accounts payable 326 (250)
Restructuring charges, net of cash paid (14) 33
Taxes deferred and payable, net (112) (256)
Accrued pension (84) (123)
Employee compensation 213 (84)
Other 186 (145)
----- ------
Cash provided by operating activities 1,550 327
----- ------
Investing activities
Capital expenditures (541) (547)
Proceeds from sale of assets 77 119
Investment in related businesses (35) (5)
----- ------
Cash used in investing activities (499) (433)
----- ------
Financing activities
Proceeds from borrowings of long-term debt 872 545
Net (repayments) proceeds from short-term borrowings (362) 101
Repayments of long-term debt (210) (131)
Dividends paid (128) (128)
Common stock issued 21 21
Purchase of treasury stock - (247)
Other (49) (20)
----- ------
Cash provided by financing activities 144 141
----- ------
Effect of exchange rate changes on cash and equivalents 39 (90)
----- ------
Increase (decrease) in cash and equivalents 1,234 (55)
Cash and equivalents at beginning of year 146 201
------ ------
Cash and equivalents at end of year $1,380 $146
====== ======
SOURCE Whirlpool Corporation |
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