Whirlpool’s Net Earnings Drop 76% In Fourth Qtr.
By Steve Smith -- TWICE,02/09/2009
Net earnings in the quarter were down to $44 million compared with $187 million in the prior year.
Sales for the quarter were down 19 percent to $4.3 billion compared with the prior year’s $5.3 billion. Excluding the impact of foreign exchange translation, the company's fourth-quarter sales declined about 13 percent.
Fourth-quarter earnings reflect sharply lower global unit sales and production volumes, higher material and oil-related costs and unfavorable foreign currency exchange movements compared to the fourth quarter of 2007.
Whirlpool also recorded $77 million of restructuring costs compared with $15 million in the prior year. Results were also unfavorably impacted by a $32 million product recall expense related to a supplier quality issue.
"The severity and scope of the global economic downturn has significantly increased over the last several months and had a significant impact on consumer demand in all parts of the world," said Jeff Fettig, Whirlpool chairman/CEO. "We have moved very quickly to adjust our business to much lower demand levels by significantly reducing costs and production levels while continuing to focus on providing our trade customers with an ongoing cadence of innovation which represents great value to consumers."
In North America Whirlpool had fourth-quarter sales of $2.5 billion declined 18 percent from the prior year. Excluding the effects of currency, sales declined approximately 16 percent from the prior year.
The
Based on current economic conditions, the company expects full-year 2009
For its full year Whirlpool reported annual net sales were down 3 percent to $18.9 billion. Operating earnings were down by almost half to $549 million and net earnings were down about a third to $418 million.
In commenting on the new year’s prospects Fettig said in a prepared statement, "We expect 2009 economic conditions to be among the most challenging that we have faced. Significant demand declines, volatile cost and currency levels are expected throughout the year. To succeed in this environment we are aggressively taking additional steps, beyond actions previously announced, to further reduce all areas of cost, production capacity, working capital and capital expenditures. We will continue to have focused investments in new product innovation to further strengthen our branded market position with our consumers."Post a comment Return to article View other article discussions
| Submitted by: | John R. Hofmann Sr. (john@photosbyjohn.net) 2/10/2009 6:55:48 AM PT |
| Location: | Allentown PA |
| Occupation: | Appliance Store Owner |
To me the issue with Whirlpool is twofold. The first is a failure to innovate. Think LG Washers which did not exist here 5 years ago and is now the most popular selling front loader in the country! Can you spell S-T-E-A- M?? Although off to a slow start do more to timing than anything else, Electrolux with push button doors on their laundry products and air-guard on their ranges not to mention their classic "European" styling.
The second issue is related to the first. The picture in my head of the Whirlpool management is that of the old south archetypical fat bellied Mississippi Sheriff behind his mirrored sunglasses chewing on a piece of straw, feet up on the desk leaning on the back two legs of his chair, contemplating how he''s gonna run the county "his way". Whirlpool though they were going to buy their way into a monopoly and rule the county "their way". You know, kinda like GM. "Toyota who?" ah those guys nothing more than a knat on the back of my neck. I''ll just swat ''em and forget ''em."
Is it possibly something in the MI water? Or maybe they don''t subscribe to the business journals in Benton Harbor or Detroit. After all Dr. W Edwards Deming had to go to Japan after WWII to teach his philosophy of quality since he was not welcome here! He was good enough to help us win WWII but not good enough to help us subsequently at Maytag or Whirlpool or GM!
I defy you to put a hand truck under any conventional Whirlpool made washer or dryer, tilt it back and NOT hear a screw or washer or some other metallic part roll around inside. I''m not kidding. I own an appliance store for over three years and I honestly cannot recall a single exception!
You know the old quality thing of perception? You sit down in an airliner, pull down the seatback table see that it is filthy and assume that must be the same way the mechanics treat the engines. Let me off! I don''t want to die Whirlpool!
Post a comment Return to article View other article discussions
