BENTON HARBOR, Mich.,
July 23, 2014 /PRNewswire/ -- Whirlpool Corporation (NYSE:
WHR) announced today second-quarter GAAP net earnings of
$179 million, or $2.25 per diluted share, compared to $198 million, or $2.44 per diluted share, reported for the same
prior-year period. Ongoing business earnings per diluted
share(1) increased to a second quarter record
$2.62, compared to $2.37 in the prior-year period, mainly driven by
improved product price and mix, ongoing cost productivity and the
benefit of cost and capacity-reduction initiatives.
Net sales in the quarter were $4.7
billion compared to $4.7
billion during the same prior-year period. Excluding the
impact of both foreign currency and Brazilian (BEFIEX) tax credits,
sales increased approximately 1 percent.
"The second-quarter results were in line with our expectations
as our North America Region delivered record operating profit,"
said Jeff M. Fettig, chairman and
chief executive officer of Whirlpool Corporation. "Overall,
the underlying fundamentals of our business remain strong and we
continue to invest in our business through innovative new products
and acquisitions."
Second-quarter GAAP operating profit totaled $291 million, compared to $328 million in the same prior-year period.
Ongoing business operating profit(2) totaled
$330 million, or 7.1 percent of
sales, compared to $335 million, or
7.1 percent of sales, in the same prior-year period. Improved
product price and mix, ongoing cost productivity and the benefit of
cost and capacity-reduction initiatives were more than offset by
lower unit volumes, higher material costs, foreign currency and
increased investments in marketing, technology and products.
During the six months ended June 30, 2014, the company
reported cash used in operating activities of $(368) million compared to $(196) million in the prior-year period. On a
year-to-date basis, Whirlpool Corporation reported free cash
flow(3) use of $(622)
million, compared to free cash flow(3) use of
$(373) million in the same prior-year
period. Free cash flow(3) use was primarily driven by
increased capital spending and higher levels of inventory to
support product line transitions and new product launches in
the second half.
OUTLOOK
Whirlpool Corporation has adjusted its full-year 2014 guidance
to reflect trade customer inventory transitions in China related to the pending acquisition of a
majority stake in Hefei Rongshida Sanyo Electric Co., Ltd. and
investment expenses related to the pending acquisition of a
majority stake in Indesit Company S.p.A. The company expects
full-year net earnings per diluted share of $10.30 to $10.80 and full-year ongoing business
earnings per diluted share of $11.50 to
$12.00.
|
2014 Diluted
EPS(i)
|
|
Ongoing
|
GAAP
|
Previous
Outlook
|
$12.00–$12.50
|
$11.05–$11.55
|
China Trade Inventory
Transitions
|
(0.50)
|
(0.50)
|
Indesit Investment
Expenses
|
–
|
(0.25)
|
Current
Outlook
|
$11.50-$12.00
|
$10.30-$10.80
|
|
|
|
|
|
|
|
|
2014 EPS
Outlook
|
GAAP Diluted
EPS(i)
|
|
$10.30–$10.80
|
Restructuring
Expense
|
|
~0.95
|
Brazilian (BEFIEX)
Tax Credits
|
|
(0.18)
|
Investment
Expense(ii)
|
|
~0.46
|
Antitrust
Resolutions
|
|
0.02
|
Ongoing Business
Diluted EPS
|
$11.50–$12.00
|
|
|
(i)
|
Diluted EPS
available to Whirlpool.
|
(ii)
|
Previous guidance
of $0.21 was increased by $0.25 for Indesit investment
expense.
|
For the full-year 2014, the company expects to generate free
cash flow(3) of $600 million to
$650 million. Included in this guidance are restructuring
cash outlays of up to $150 million,
capital spending of $625 million to $675
million and U.S. pension contributions of approximately
$160 million.
"For the balance of the year, we will benefit from increasing
global demand, new product introductions, previously announced
price increases and strong productivity," said Fettig. "We
expect to acquire majority interests in Hefei Sanyo and Indesit by the end of this year,
all of which provides us with an outstanding platform for growth
and value creation in 2015 and beyond."
SECOND-QUARTER REGIONAL REVIEW
Whirlpool North
America
Whirlpool North America
reported second-quarter net sales of $2.7
billion compared to $2.6
billion in the same prior-year period, an increase of over 3
percent. Excluding the impact of currency, sales increased
approximately 4 percent.
The region reported a record second-quarter operating profit of
$285 million, or 10.6 percent of
sales, compared to $262 million, or
10.1 percent of sales, in the same prior-year period. Ongoing cost
productivity and cost and capacity-reduction benefits offset higher
material costs, foreign currency and increased investments in
marketing, technology and products.
The company expects full-year 2014 industry unit shipments to
increase by approximately 5 percent.
Whirlpool Europe,
Middle East and Africa
Whirlpool Europe, Middle East and Africa reported second-quarter net sales of
$746 million compared to $731 million in the same prior-year period.
Excluding the impact of currency, sales decreased approximately 3
percent.
The region reported second-quarter operating profit of
$2 million, compared to an operating
loss of $(6) million in the same
prior-year period. Ongoing cost productivity, the benefit of cost
and capacity-reduction initiatives, and improved product price and
mix more than offset lower unit volumes, foreign currency and
increased investments in marketing, technology and products.
The company expects full-year 2014 industry unit shipments to be
flat to up 2 percent.
Whirlpool Latin
America
Whirlpool Latin America
reported second-quarter net sales of $1.1
billion, compared to $1.2
billion in the same prior-year period. Excluding the impact
of currency and BEFIEX tax credits, sales declined less than 4
percent.
The region reported second-quarter operating profit of
$87 million, compared to $135 million in the same prior-year period.
During the second quarter of 2013, the company monetized
$24 million of BEFIEX tax credits.
Ongoing business segment operating profit(4) totaled
$87 million, or 8.0 percent of sales,
compared to $111 million, or 9.3
percent of sales, in the same prior-year period. Improved product
price and mix was more than offset by lower unit volumes, higher
material costs and foreign currency.
The company expects full-year 2014 industry unit shipments to be
flat to down 3 percent.
Whirlpool Asia
Whirlpool Asia reported
second-quarter net sales of $211
million compared to $246
million in the same prior-year period. Excluding the impact
of currency, sales decreased approximately 9 percent.
The region reported second-quarter operating profit of
$4 million, or 1.9 percent of sales,
compared to $14 million, or 5.6
percent of sales, in the same prior-year period. Improved price and
mix and ongoing cost productivity were more than offset by lower
unit volumes and margins due to trade inventory transitions in
China related to the pending
acquisition, as well as higher material costs and foreign
currency.
The company expects full-year 2014 industry unit shipments to be
flat.
(1) A reconciliation of ongoing business earnings per
diluted share, a non-GAAP financial measure, to reported net
earnings per diluted share available to Whirlpool and other
important information, appears below.
(2) A reconciliation of ongoing business operating profit, a
non-GAAP financial measure, to reported operating profit and other
important information, appears below.
(3) A reconciliation of free cash flow, a non-GAAP financial
measure, to cash provided by operating activities and other
important information, appears below.
(4) A reconciliation of ongoing business segment operating
profit, a non-GAAP financial measure, to reported segment operating
profit and other important information, appears below.
SECOND-QUARTER 2014 PRODUCT LEADERSHIP, INNOVATION AND
AWARDS
Whirlpool Corporation is at the forefront of the home
appliance industry - with deep consumer insights and the strongest
portfolio of brands worldwide. Our products are uniquely positioned
with consumers because they are as inventive as they are practical.
We offer compelling home solutions that expand beyond our core
appliance business. Across our company and around the world, we are
strengthening our consumer demand by delivering innovation that
matters to consumers and positioning our company for continued
growth and profitability.
Awards and Recognition
- Whirlpool Corporation's new Whirlpool
Duet steam dryer received the industry's first ENERGY STAR®
qualification for clothes dryers. Over 400 Whirlpool Corporation
appliances carry the U.S. Environmental Protection Agency's ENERGY
STAR label - more than any other manufacturer.
- Whirlpool Corporation was a platinum sponsor of the Energy
Efficiency Global Forum 2014, hosted by the Alliance to Save
Energy. Whirlpool efficiency experts joined more than 120 leaders
from around the world in sharing insights and key learnings on the
topic of energy efficiency.
- In May, the Whirlpool Duet steam
washer was named "Best Custom Wash" in the front-load category by a
leading U.S. consumer publication.
- In May, the Maytag Bravos XL HE washer
with steam was named "TLC Champ" in the modern top-load category by
a leading U.S. consumer publication.
- Whirlpool Latin America was
named the best company of the electronics industry by
Exame business magazine.
- Whirlpool Latin America was
recognized as the most innovative company in Brazil by INFO
magazine, which focuses on technology.
- At the Women's Empowerment Principles event, hosted by the
United Nations, Whirlpool Latin America received an honorary
mention for its work in improving the lives of women in
Brazil.
Product Innovation
- In North America, the new
KitchenAid dishwasher features an optional
ProScrub cycle that eliminates the need to
pre-rinse dishes and a groundbreaking wash system that uses a
unique, ultra-fine filter to filter 100% of the wash water for a
shorter overall wash cycle with less water usage.
- The Whirlpool 6th Sense induction
cooktop, available in Europe,
combines the power of induction with 6th
Sense technology for greater intuitiveness and ease of use.
With just one touch, consumers can pick from the most frequent
cooking methods, and the large FlexiCook
surface makes it easier than ever to prepare a variety of
dishes.
- In Europe, the new
Whirlpool refrigerator and freezer can be
installed separately or as a pair, in both freestanding and
built-in configurations, providing superior versatility for the
home. The pair's lighting system and premium interior design make
it easier to manage your groceries and meals, while the
6th Sense FreshControl and
ShockFreeze technologies keep food fresh
longer.
- Whirlpool India's new line of
Whirlpool Protton no-frost refrigerators
use less energy than a CFL light bulb while making it easier for
families to preserve their groceries and keep food fresh.
- Whirlpool brand's 3D Cool Climate Control line of split air conditioners
bring fast, powerful and uniform cooling to consumers in
India. With three preset climate
options, consumers can also quickly adjust the temperature during
the country's changing summer conditions.
Product Line Growth
- The North America Region broadened its line of smart appliances
with the launch of the Whirlpool smart
front-load washer and dryer with Nest Technology. The laundry pair
uses the Nest Application Programming Interface to help save
consumers energy and keep their laundry fresh if the cycle ends
while they are away.
- The Consul Facilite automatic washer
offers consumers in Brazil's
emerging middle class best-in-class quality at a price they can
afford. Doing the laundry is less of a chore, thanks to the easy
dosing detergent dispenser and environmentally friendly water reuse
function.
Growth Beyond Core Appliances
- Whirlpool Corporation and P&G introduced Swash, a
revolutionary at-home clothing care system that reduces wrinkles,
refreshes fabric, restores the fit lost after wear and preserves
clothing. In just 10 minutes with the push of a button, the
Swash system allows people to reduce or eliminate ironing,
save on dry cleaning, and better care for and preserve
clothes.
Geographic Expansion
- The Latin America region
expanded its production of Whirlpool Max refrigerators - now
locally manufactured and sold in Colombia, strengthening the brand's presence
outside of the Brazilian market.
About Whirlpool Corporation
Whirlpool Corporation is
the world's leading global manufacturer and marketer of major home
appliances, with annual sales of approximately $19 billion in 2013, 69,000 employees and 59
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. 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) intense
competition in the home appliance industry reflecting the impact of
both new and established global competitors, including Asian and
European manufacturers; (2) Whirlpool's ability to continue its
relationship with significant trade customers and the ability of
these trade customers to maintain or increase market share; (3)
acquisition and investment-related risk, including risks associated
with our pending acquisitions of Hefei
Sanyo and Indesit; (4) changes in economic conditions which
affect demand for our products, including the strength of the
building industry and the level of interest rates; (5) product
liability and product recall costs; (6) inventory and other asset
risk; (7) risks related to our international operations, including
changes in foreign regulations, regulatory compliance and
disruptions arising from natural disasters or terrorist attacks;
(8) the uncertain global economy; (9) the ability of Whirlpool to
achieve its business plans, productivity improvements, cost
control, price increases, leveraging of its global operating
platform, and acceleration of the rate of innovation; (10)
Whirlpool's ability to maintain its reputation and brand image;
(11) fluctuations in the cost of key materials (including steel,
plastic, resins, copper and aluminum) and components and the
ability of Whirlpool to offset cost increases; (12) litigation,
tax, and legal compliance risk and costs, especially costs which
may be materially different from the amount we expect to incur or
have accrued for; (13) the effects and costs of governmental
investigations or related actions by third parties; (14)
Whirlpool's ability to obtain and protect intellectual property
rights; (15) the ability of suppliers of critical parts, components
and manufacturing equipment to deliver sufficient quantities to
Whirlpool in a timely and cost-effective manner; (16) health care
cost trends, regulatory changes and variations between results and
estimates that could increase future funding obligations for
pension and postretirement benefit plans; (17) information
technology system failures and data security breaches; (18) the
impact of labor relations; (19) our ability to attract, develop and
retain executives and other qualified employees; (20) changes in
the legal and regulatory environment including environmental and
health and safety regulations; and (21) the ability of Whirlpool to
manage foreign currency fluctuations.
Additional information concerning these and other factors can be
found in Whirlpool'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 CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
FOR THE PERIODS ENDED JUNE 30
(Millions of dollars, except share data)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Net
sales
|
$
|
4,682
|
|
$
|
4,748
|
|
$
|
9,045
|
|
$
|
8,996
|
Expenses
|
|
|
|
|
|
|
|
Cost of products
sold
|
3,895
|
|
3,931
|
|
7,503
|
|
7,453
|
Gross
margin
|
787
|
|
817
|
|
1,542
|
|
1,543
|
Selling, general and
administrative
|
457
|
|
453
|
|
896
|
|
874
|
Intangible
amortization
|
5
|
|
5
|
|
11
|
|
14
|
Restructuring
costs
|
34
|
|
31
|
|
63
|
|
73
|
Operating
profit
|
291
|
|
328
|
|
572
|
|
582
|
Other income
(expense)
|
|
|
|
|
|
|
|
Interest and sundry
income (expense)
|
(16)
|
|
(39)
|
|
(39)
|
|
(57)
|
Interest
expense
|
(40)
|
|
(44)
|
|
(84)
|
|
(90)
|
Earnings before
income taxes
|
235
|
|
245
|
|
449
|
|
435
|
Income tax expense
(benefit)
|
50
|
|
39
|
|
100
|
|
(28)
|
Net
earnings
|
185
|
|
206
|
|
349
|
|
463
|
Less: Net earnings
available to noncontrolling interests
|
6
|
|
8
|
|
10
|
|
13
|
Net earnings
available to Whirlpool
|
$
|
179
|
|
$
|
198
|
|
$
|
339
|
|
$
|
450
|
Per share of
common stock
|
|
|
|
|
|
|
|
Basic net earnings
available to Whirlpool
|
$
|
2.29
|
|
$
|
2.48
|
|
$
|
4.34
|
|
$
|
5.66
|
Diluted net earnings
available to Whirlpool
|
$
|
2.25
|
|
$
|
2.44
|
|
$
|
4.27
|
|
$
|
5.56
|
Dividends
declared
|
$
|
0.75
|
|
$
|
0.625
|
|
$
|
1.375
|
|
$
|
1.125
|
Weighted-average
shares outstanding (in millions)
|
|
|
|
|
|
|
|
Basic
|
78.3
|
|
79.8
|
|
78.2
|
|
79.5
|
Diluted
|
79.6
|
|
81.1
|
|
79.6
|
|
81.0
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
$
|
184
|
|
$
|
115
|
|
$
|
390
|
|
$
|
341
|
WHIRLPOOL
CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(Millions of dollars, except share data)
|
|
|
(Unaudited)
|
|
|
|
June 30,
2014
|
|
December 31,
2013
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and
equivalents
|
$
|
945
|
|
$
|
1,380
|
Accounts receivable,
net of allowance of $77 and $73, respectively
|
2,222
|
|
2,005
|
Inventories
|
2,812
|
|
2,408
|
Deferred income
taxes
|
335
|
|
549
|
Prepaid and other
current assets
|
731
|
|
680
|
Total current
assets
|
7,045
|
|
7,022
|
Property, net of
accumulated depreciation of $6,425 and $6,278,
respectively
|
3,069
|
|
3,041
|
Goodwill
|
1,723
|
|
1,724
|
Other intangibles,
net of accumulated amortization of $249 and $237,
respectively
|
1,692
|
|
1,702
|
Deferred income
taxes
|
1,758
|
|
1,764
|
Other noncurrent
assets
|
321
|
|
291
|
Total
assets
|
$
|
15,608
|
|
$
|
15,544
|
Liabilities and
stockholders' equity
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
3,876
|
|
$
|
3,865
|
Accrued
expenses
|
667
|
|
710
|
Accrued advertising
and promotions
|
353
|
|
441
|
Employee
compensation
|
357
|
|
456
|
Notes
payable
|
3
|
|
10
|
Current maturities of
long-term debt
|
312
|
|
607
|
Other current
liabilities
|
550
|
|
705
|
Total current
liabilities
|
6,118
|
|
6,794
|
Noncurrent
liabilities
|
|
|
|
Long-term
debt
|
2,461
|
|
1,846
|
Pension
benefits
|
868
|
|
930
|
Postretirement
benefits
|
468
|
|
458
|
Other noncurrent
liabilities
|
342
|
|
482
|
Total noncurrent
liabilities
|
4,139
|
|
3,716
|
Stockholders'
equity
|
|
|
|
Common stock, $1 par
value, 250 million shares authorized, 110 million and 109
million shares issued, and 78 million and 77 million shares
outstanding, respectively
|
110
|
|
109
|
Additional paid-in
capital
|
2,497
|
|
2,453
|
Retained
earnings
|
6,015
|
|
5,784
|
Accumulated other
comprehensive loss
|
(1,258)
|
|
(1,298)
|
Treasury stock, 32
million shares
|
(2,124)
|
|
(2,124)
|
Total Whirlpool
stockholders' equity
|
5,240
|
|
4,924
|
Noncontrolling
interests
|
111
|
|
110
|
Total stockholders'
equity
|
5,351
|
|
5,034
|
Total liabilities and
stockholders' equity
|
$
|
15,608
|
|
$
|
15,544
|
WHIRLPOOL
CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE PERIODS ENDED JUNE 30
(Millions of dollars)
|
|
|
Six Months
Ended
|
|
2014
|
|
2013
|
Operating
activities
|
|
|
|
Net
earnings
|
$
|
349
|
|
$
|
463
|
Adjustments to
reconcile net earnings to cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
261
|
|
255
|
Changes in assets and
liabilities:
|
|
|
|
Accounts
receivable
|
(215)
|
|
(274)
|
Inventories
|
(375)
|
|
(199)
|
Accounts
payable
|
(41)
|
|
19
|
Accrued advertising
and promotions
|
(88)
|
|
(55)
|
Taxes deferred and
payable, net
|
16
|
|
(110)
|
Accrued pension and
postretirement benefits
|
(69)
|
|
(89)
|
Employee
compensation
|
(84)
|
|
(106)
|
Other
|
(122)
|
|
(100)
|
Cash used in
operating activities
|
(368)
|
|
(196)
|
Investing
activities
|
|
|
|
Capital
expenditures
|
(265)
|
|
(180)
|
Proceeds from sale of
assets
|
11
|
|
3
|
Investment in related
businesses
|
(36)
|
|
—
|
Other
|
—
|
|
(38)
|
Cash used in
investing activities
|
(290)
|
|
(215)
|
Financing
activities
|
|
|
|
Proceeds from
borrowings of long-term debt
|
818
|
|
499
|
Repayments of
long-term debt
|
(504)
|
|
(505)
|
Dividends
paid
|
(107)
|
|
(89)
|
Net repayments of
short-term borrowings
|
(6)
|
|
1
|
Common stock
issued
|
28
|
|
63
|
Purchase of treasury
stock
|
—
|
|
(30)
|
Purchase of
noncontrolling interest shares
|
(5)
|
|
—
|
Other
|
(9)
|
|
(8)
|
Cash provided by
(used in) financing activities
|
215
|
|
(69)
|
Effect of exchange
rate changes on cash and equivalents
|
8
|
|
(18)
|
Decrease in cash and
equivalents
|
(435)
|
|
(498)
|
Cash and equivalents
at beginning of period
|
1,380
|
|
1,168
|
Cash and equivalents
at end of period
|
$
|
945
|
|
$
|
670
|
SUPPLEMENTAL INFORMATION - CONSOLIDATED
FINANCIAL STATEMENTS
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
MEASURES
(Millions of dollars except per share data)
(Unaudited)
We supplement the reporting of our financial information
determined under U.S. generally accepted accounting principles
(GAAP) with certain non-GAAP financial measures, some of which we
refer to as "ongoing business" measures, including ongoing business
operating profit, ongoing business operating margin, ongoing
business earnings (loss) before income taxes, ongoing business
earnings per diluted share, ongoing business segment operating
profit, ongoing business segment operating margin, sales excluding
foreign currency and BEFIEX, and free cash flow. Ongoing business
measures exclude items that may not be indicative of, or are
unrelated to, results from our ongoing business operations and
provide a better baseline for analyzing trends in our underlying
businesses. Sales excluding foreign currency and BEFIEX is
calculated by translating the current period net sales excluding
BEFIEX, in functional currency, to U.S. dollars using the
prior-year period's exchange rate compared to the prior-year period
net sales excluding BEFIEX. Management believes that sales
excluding foreign currency and BEFIEX provides stockholders with a
clearer basis to assess our results over time. Management
believes that free cash flow provides investors and stockholders
with a relevant measure of liquidity and a useful basis for
assessing the company's ability to fund its activities and
obligations. We believe that these non-GAAP measures provide
meaningful information to assist investors and stockholders in
understanding our financial results and assessing our prospects for
future performance. Because non-GAAP financial measures are not
standardized, it may not be possible to compare these financial
measures with other companies' non-GAAP financial measures having
the same or similar names. These ongoing business financial
measures should not be considered in isolation or as a substitute
for reported operating profit, earnings (loss) before income taxes,
net earnings per diluted share available to Whirlpool, reported
operating profit by segment, net sales, and cash provided by (used
in) operating activities, the most directly comparable GAAP
financial measures. These non-GAAP financial measures reflect an
additional way of viewing aspects of our operations that, when
viewed with our GAAP results and the following reconciliations to
corresponding GAAP financial measures, provide a more complete
understanding of our business. We strongly encourage investors and
stockholders to review our financial statements and publicly-filed
reports in their entirety and not to rely on any single financial
measure.
Ongoing Business Operating Profit, Ongoing Business Earnings
Before Income Taxes and Ongoing Business Earnings Per Diluted
Share
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing business operating profit, ongoing
business earnings before income taxes and ongoing business earnings
per diluted share, with the most directly comparable GAAP financial
measures, operating profit, earnings before income taxes and net
earnings per diluted share available to Whirlpool, for the three
months ended June 30, 2014. Ongoing business operating margin
is calculated by dividing ongoing business operating profit by net
sales.
|
Three Months
Ended
|
|
June 30,
2014
|
|
Operating
Profit
|
|
Earnings
Before Income
Taxes
|
|
Earnings per
Diluted Share
|
Reported GAAP
Measure
|
$
|
291
|
|
$
|
235
|
|
$
|
2.25
|
Restructuring
Expense(a)
|
34
|
|
34
|
|
0.33
|
Investment
Expense(b)
|
5
|
|
13
|
|
0.12
|
Antitrust
Resolutions(c)
|
—
|
|
1
|
|
0.01
|
Normalized Tax Rate
Adjustment(d)
|
—
|
|
—
|
|
(0.09)
|
Ongoing Business
Measure
|
$
|
330
|
|
$
|
283
|
|
$
|
2.62
|
Ongoing Business Operating Profit, Ongoing Business Earnings
Before Income Taxes and Ongoing Business Earnings Per Diluted
Share
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing business operating profit, ongoing
business earnings before income taxes and ongoing business earnings
per diluted share, with the most directly comparable GAAP financial
measures, operating profit, earnings before income taxes and net
earnings per diluted share available to Whirlpool, for the three
months ended June 30, 2013. Ongoing business operating margin
is calculated by dividing ongoing business operating profit by net
sales excluding BEFIEX.
|
Three Months
Ended
|
|
June 30,
2013
|
|
Operating
Profit
|
|
Earnings
Before Income
Taxes
|
|
Earnings per
Diluted Share
|
Reported GAAP
Measure
|
$
|
328
|
|
$
|
245
|
|
$
|
2.44
|
Restructuring
Expense(a)
|
31
|
|
31
|
|
0.29
|
Brazilian (BEFIEX)
Tax Credits(e)
|
(24)
|
|
(24)
|
|
(0.29)
|
Investment
Expense(b)
|
—
|
|
10
|
|
0.10
|
Antitrust and
Contract Resolutions(c)
|
—
|
|
2
|
|
0.01
|
U.S. Energy Tax
Credits(f)
|
—
|
|
—
|
|
(0.20)
|
Normalized Tax Rate
Adjustment(d)
|
—
|
|
—
|
|
0.02
|
Ongoing Business
Measure
|
$
|
335
|
|
$
|
264
|
|
$
|
2.37
|
Ongoing Business Segment Operating
Profit
The reconciliation provided below reconciles the non-GAAP
financial measure ongoing business segment operating profit with
the most directly comparable GAAP financial measure, segment
operating profit, for the three months ended June 30, 2014.
Ongoing business segment operating margin is calculated by dividing
ongoing business segment operating profit by segment net sales.
|
Three Months
Ended
|
|
June 30,
2014
|
|
Segment
Operating
Profit
|
|
Restructuring
Expense(a)
|
|
Investment
Expense(b)
|
|
Ongoing
Business
Segment
Operating
Profit
|
North
America
|
$
|
285
|
|
$
|
—
|
|
$
|
—
|
|
$
|
285
|
Latin
America
|
87
|
|
—
|
|
—
|
|
87
|
EMEA
|
2
|
|
—
|
|
—
|
|
2
|
Asia
|
4
|
|
—
|
|
—
|
|
4
|
Other/Eliminations
|
(87)
|
|
34
|
|
5
|
|
(48)
|
Total Whirlpool
Corporation
|
$
|
291
|
|
$
|
34
|
|
$
|
5
|
|
$
|
330
|
The reconciliation provided below reconciles the non-GAAP
financial measure ongoing business segment operating profit (loss)
with the most directly comparable GAAP financial measure, reported
segment operating profit (loss), for the three months ended
June 30, 2013. Ongoing business segment operating margin is
calculated by dividing ongoing business segment operating profit by
segment net sales excluding BEFIEX.
|
Three Months
Ended
|
|
June 30,
2013
|
|
Segment
Operating
Profit (Loss)
|
|
Restructuring
Expense(a)
|
|
Brazilian
(BEFIEX) Tax
Credits(b)
|
|
Ongoing
Business
Segment
Operating Profit
(Loss)
|
North
America
|
$
|
262
|
|
$
|
—
|
|
$
|
—
|
|
$
|
262
|
Latin
America
|
135
|
|
—
|
|
(24)
|
|
111
|
EMEA
|
(6)
|
|
—
|
|
—
|
|
(6)
|
Asia
|
14
|
|
—
|
|
—
|
|
14
|
Other/Eliminations
|
(77)
|
|
31
|
|
—
|
|
(46)
|
Total Whirlpool
Corporation
|
$
|
328
|
|
$
|
31
|
|
$
|
(24)
|
|
$
|
335
|
Footnotes:
|
|
|
a.
|
During the second
quarters of 2014 and 2013, we recorded restructuring charges of $34
million and $31 million, respectively. The earnings per diluted
share impacts are calculated based on income tax impacts of $8
million and $7 million, respectively.
|
|
|
b.
|
During the second
quarters of 2014 and 2013, we recognized investment expenses of $13
million and $10 million, respectively, primarily related to the
pending acquisitions of majority interests in Hefei Sanyo and,
specifically for 2014, Indesit. The earnings per diluted share
impacts are calculated based on income tax impacts of $3
million and $2 million, respectively.
|
|
|
c.
|
During the second
quarter of 2014, we recognized expenses of approximately $1 million
related to antitrust resolutions. The earnings per diluted share
impact is calculated based on an income tax impact of $0 million.
During the second quarter of 2013 we recognized expenses of $2
million related to antitrust and contract resolutions. The earnings
per diluted share impact is calculated based on an income tax
impact of $0 million.
|
|
|
d.
|
During the second
quarters of 2014 and 2013, we made adjustments to ongoing business
diluted EPS to reconcile specific items reported to a full-year
effective tax rate of 24%.
|
|
|
e.
|
During the second
quarter of 2013, we monetized Brazilian (BEFIEX) tax credits of $24
million. The earnings per diluted share impact is calculated based
on an income tax impact of $0 million.
|
|
|
f.
|
In the second quarter
of 2013, we recognized $16 million of U.S. energy tax credits. The
earnings per diluted share impact is calculated based on an income
tax benefit of $16 million.
|
Free Cash Flow
As defined by the company, free cash flow is cash provided by
(used in) operating activities after capital expenditures and
proceeds from the sale of assets and businesses. The reconciliation
provided below reconciles six-month actual 2014 and 2013 and
projected full-year free cash flow with cash provided by (used in)
operating activities, the most directly comparable GAAP financial
measure.
|
Six Months
Ended
June 30,
|
|
|
|
|
|
|
(millions of
dollars)
|
2014
|
2013
|
|
2014
Outlook
|
Cash Provided by
(Used In) Operating Activities
|
$
|
(368)
|
|
$
|
(196)
|
|
|
$
|
1,225
|
–
|
$
|
1,325
|
Capital Expenditures
and Proceeds from Sale of Assets/Businesses
|
|
(254)
|
|
|
(177)
|
|
|
|
(625)
|
–
|
|
(675)
|
Free Cash
Flow
|
$
|
(622)
|
|
$
|
(373)
|
|
|
$
|
600
|
–
|
$
|
650
|
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SOURCE Whirlpool Corporation