Whirlpool Announces Third-Quarter Results

--  Sequential margin expansion in MDA North America for the second consecutive quarter, driven by promotional pricing actions

--  Q3 GAAP net earnings margin of 2.7% (Q2 5.5%); GAAP earnings per diluted share of $2.00; GAAP tax rate of 25%

--  Ongoing (non-GAAP) EBIT margin(1) of 5.8% (Q2 5.3%); ongoing earnings per diluted share(2) of $3.43 supported by favorable adjusted (non-GAAP) tax rate of (32)%

--  Revising full-year GAAP earnings per diluted share to approximately $0.50, impacted by the updated GAAP tax rate and non-cash losses related to the Europe transaction

--  Reaffirming full-year ongoing earnings per diluted share(2) of approximately $12.00, cash provided by operating activities of approximately $1.05 billion and free cash flow(3) of approximately $500 million

BENTON HARBOR, Mich., Oct. 23, 2024 /PRNewswire/ -- Whirlpool Corporation (NYSE:WHR), today reported third-quarter 2024 financial results.

"In Q3, we continued to deliver sequential ongoing EBIT margin expansion despite the unfavorable macroeconomic environment we are experiencing in North America," said Marc Bitzer. "We remain well positioned to benefit from the eventual U.S. housing market recovery."MARC BITZER, CHAIRMAN AND CHIEF EXECUTIVE OFFICER 

Third-Quarter Results

2024*

2023

Change

Net sales ($M)

$3,993

$4,926

(18.9) %

Organic net sales ($M)(4)

$4,069

$4,097

(0.7) %

GAAP net earnings (loss) available to Whirlpool ($M)

$109

$83

31.3 %

Ongoing EBIT(1) ($M)

$233

$322

(27.6) %

GAAP earnings (loss) per diluted share

$2.00

$1.53

30.7 %

Ongoing earnings per diluted share(2)

$3.43

$5.45

(37.1) %

*Excludes net sales from our previously-owned MDA Europe business

Free Cash Flow

2024

2023

Change

Cash provided by (used in) operating activities ($M)

$(271)

$(322)

$51

Free cash flow(3) ($M)

$(586)

$(660)

$74

"I am pleased with our continued focus on working capital management, resulting in structural inventory efficiency."JIM PETERS, CHIEF FINANCIAL AND ADMINISTRATIVE OFFICER

SEGMENT REVIEW

SEGMENT INFORMATION ($M)

Q3 2024

Q3 2023

Change

MDA North America

Net Sales

$2,647

$2,766

(4.3) %

EBIT

$194

$254

(23.6) %

     % of sales

7.3 %

9.2 %

(1.9pts)

MDA Latin America

Net Sales

$846

$843

0.4 %

EBIT

$58

$52

11.5 %

     % of sales

6.9 %

6.2 %

0.7pts

MDA Asia

Net Sales

$239

$219

9.1 %

EBIT

$7

$5

40.0 %

     % of sales

2.9 %

2.3 %

0.6pts

SDA Global

Net Sales

$261

$269

(3.0) %

EBIT

$37

$49

(24.5) %

     % of sales

14.2 %

18.2 %

(4.0pts)

MDA: Major Domestic Appliances; SDA: Small Domestic Appliances

MDA NORTH AMERICA

Excluding currency, net sales decreased 4.2 percent year-over-year, from unfavorable price/mix, which significantly improved vs. last quarter

EBIT margin(5) decreased year-over-year, driven by unfavorable price/mix; however, sequentially up by 100 basis points from Q2

MDA LATIN AMERICA

Excluding currency, net sales increased 8.8 percent year-over-year, with strong industry demand more than offsetting unfavorable price/mix

EBIT margin(5) increased year-over-year, driven by fixed cost leverage and cost take out actions

MDA ASIA

Excluding currency, net sales increased 10.3 percent year-over-year, with increased volumes from share gains

EBIT margin(5) increased year-over-year, driven by improved price/mix and fixed cost leverage

SDA GLOBAL

Excluding currency, net sales decreased 3.3 percent year-over-year, with strong direct-to-consumer sales and product launches offset by soft industry

EBIT margin(5) decreased year-over-year, impacted by continued marketing investments in new product launches

FULL-YEAR 2024 OUTLOOK

Guidance Summary

2023 Reported

2023 Like forLike (6)

2024 Guidance

Net sales ($M)

$19,455

~$16,900

~$16,900

Cash provided by operating activities ($M)

$915

N/A

~$1,050

Free cash flow ($M)(3)

$366

N/A

~$500

GAAP net earnings margin (%)

2.5 %

N/A

~1.0%

Ongoing EBIT margin (%)(1)

6.1 %

~6.9%

~6.0%

GAAP earnings per diluted share

$8.72

N/A

~$0.50

Ongoing earnings per diluted share(2)

$16.16

N/A

~$12.00

GAAP tax rate

13.0 %

N/A

~65%

Adjusted (non-GAAP) tax rate

(6.7) %

N/A

(18) - (22)%

 

Revising full-year GAAP earnings per diluted share to approximately $0.50, primarily impacted by the non-cash charge related to the Europe transaction

Reaffirming full-year ongoing earnings per diluted share(2) of approximately $12.00, including ~$300 million of cost actions

Reaffirming cash provided by operating activities of approximately $1.05 billion and free cash flow(3) of approximately $500 million; includes $250-$300 million of MDA Europe cash usage in 2024

Approximately $400 million of 2024 dividends

 

(1)

A reconciliation of earnings before interest and taxes (EBIT) and ongoing EBIT, non-GAAP financial measures, to reported net earnings (loss) available to Whirlpool, and a reconciliation of EBIT margin and ongoing EBIT margin, non-GAAP financial measures, to net earnings (loss) margin and other important information, appears below.

(2)

A reconciliation of ongoing earnings per diluted share, a non-GAAP financial measure, to reported net earnings (loss) per diluted share available to Whirlpool and other important information, appears below.

(3)

A reconciliation of free cash flow, a non-GAAP financial measure, to cash provided by (used in) operating activities and other important information, appears below.

(4)

A reconciliation of organic net sales, a non-GAAP financial measure, to reported net sales and other important information, appears below.

(5)

Segment EBIT represents our consolidated EBIT broken down by the Company's reportable segments and are metrics used by the chief operating decision maker in accordance with ASC 280. Consolidated EBIT also includes corporate "Other/Eliminations" of $(45) million and $(96) million for the third quarters of 2024 and 2023, respectively.

(6)

Like-for-like refers to a comparison between the 2024 guidance and pro forma results for 2023, which exclude the second through fourth quarter resegmented results for the historical Europe major domestic appliances business (MDA Europe under new segment operating structure). This comparison uses a prior period baseline that is aligned to the ongoing business expectations for 2024, with the Europe transaction closed April 2024. The like-for-like GAAP net earnings margin and corresponding reconciliation cannot be provided without unreasonable effort or expense. Please see below for a reconciliation of ongoing EBIT for the full year to GAAP net earnings.

 

ABOUT WHIRLPOOL CORPORATION

Whirlpool Corporation (NYSE:WHR) is a leading kitchen and laundry appliance company, in constant pursuit of improving life at home and inspiring generations with our brands. The company is driving meaningful innovation to meet the evolving needs of consumers through its iconic brand portfolio, including Whirlpool, KitchenAid, JennAir, Maytag, Amana, Brastemp, Consul, and InSinkErator. In 2023, the company reported approximately $19 billion in annual net sales, 59,000 employees and 55 manufacturing and technology research centers. Additional information about the company can be found at WhirlpoolCorp.com. 

WEBSITE DISCLOSURE

We routinely post important information for investors on our website, WhirlpoolCorp.com, in the "Investors" section. We also intend to update the "Hot Topics Q&A" portion of this webpage as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the "Investors" section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our webpage is not incorporated by reference into, and is not a part of, this document.

WHIRLPOOL ADDITIONAL INFORMATION

This document contains forward-looking statements about Whirlpool Corporation and its consolidated subsidiaries ("Whirlpool") within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Whirlpool intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with those safe harbor provisions. Any statements made in this press release that are not statements of historical fact, including statements regarding future financial results, long-term value creation goals, restructuring expectations, productivity, raw material prices and related costs, supply chain, portfolio transformation expectations, asset impairment, debt repayment expectations, and housing recovery-related benefits on our operations are forward-looking statements and should be evaluated as such. Such statements can be identified by the use of terminology such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," "margin lift," and similar words or expressions. 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, and the impact of the changing retail environment, including direct-to-consumer sales; (2) Whirlpool's ability to maintain or increase sales to significant trade customers; (3) Whirlpool's ability to maintain its reputation and brand image; (4) the ability of Whirlpool to achieve its business objectives and leverage its global operating platform, and accelerate the rate of innovation; (5) Whirlpool's ability to understand consumer preferences and successfully develop new products; (6) Whirlpool's ability to obtain and protect intellectual property rights; (7) acquisition, divestiture, and investment-related risks, including risks associated with our past acquisitions; (8) the ability of suppliers of critical parts, components and manufacturing equipment to deliver sufficient quantities to Whirlpool in a timely and cost-effective manner; (9) COVID-19 pandemic, other public health emergency-related business disruptions and economic uncertainty; (10) Whirlpool's ability to navigate risks associated with our presence in emerging markets; (11) risks related to our international operations; (12) Whirlpool's ability to respond to unanticipated social, political and/or economic events; (13) information technology system failures, data security breaches, data privacy compliance, network disruptions, and cybersecurity attacks; (14) product liability and product recall costs; (15) Whirlpool's ability to attract, develop and retain executives and other qualified employees; (16) the impact of labor relations; (17) fluctuations in the cost of key materials (including steel, resins, base metals) and components and the ability of Whirlpool to offset cost increases; (18) Whirlpool's ability to manage foreign currency fluctuations; (19) impacts from goodwill impairment and related charges; (20) triggering events or circumstances impacting the carrying value of our long-lived assets; (21) inventory and other asset risk; (22) health care cost trends, regulatory changes and variations between results and estimates that could increase future funding obligations for pension and postretirement benefit plans; (23) litigation, tax, and legal compliance risk and costs; (24) the effects and costs of governmental investigations or related actions by third parties; (25) changes in the legal and regulatory environment including environmental, health and safety regulations, data privacy, and taxes and tariffs; (26) Whirlpool's ability to respond to the impact of climate change and climate change regulation; and (27) the uncertain global economy and changes in economic conditions. Price increases and/or actions referred to throughout the document reflect previously announced cost-based price increases. 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. Price increases and/or actions referred to throughout the document reflect previously announced cost-based price increases. These cautionary statements should not be construed by you to be exhaustive and the forward-looking statements are made only as of the date of this press release. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

 

WHIRLPOOL CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF INCOME (LOSS) (UNAUDITED)

FOR THE PERIODS ENDED SEPTEMBER 30

(Millions of dollars, except per share data)

Three Months Ended

Nine Months Ended

2024

2023

2024

2023

Net sales

$       3,993

$        4,926

$       12,471

$         14,367

Expenses

Cost of products sold

3,350

4,127

10,561

11,989

Gross margin

643

799

1,910

2,378

Selling, general and administrative

395

473

1,266

1,436

Intangible amortization

7

18

24

39

Restructuring costs

8

5

81

14

Loss (gain) on sale and disposal of businesses

(32)

46

260

286

Operating profit

265

257

279

603

Other (income) expense

Interest and sundry (income) expense

(6)

(10)

(27)

77

Interest expense

92

95

275

259

Earnings (loss) before income taxes

179

172

31

267

Income tax expense (benefit)

45

86

(85)

268

Equity method investment income (loss), net of tax

(20)

(1)

(31)

(3)

Net earnings (loss)

114

85

85

(4)

  Less: Net earnings (loss) available to noncontrolling interests

5

2

16

6

Net earnings (loss) available to Whirlpool

$           109

$              83