Tax bite causes Whirlpool loss

BENTON HARBOR — Whirlpool Corp. (NYSE: WHR), the world’s largest appliance maker, reported a loss of $272 million or $3.69 a share in the fourth quarter, compared to net income of $186 million or $2.36 a share in the fourth quarter of 2016.

The company blamed a one-time non-cash charge of $420 million related to tax reform for the loss.

Revenue was $5.7 billion, up from $5.66 billion a year earlier.

For the full year, net income was $350 million or $4.70 a share, down from $888 million or $11.60 a share in 2016. Revenue was $21.25 billion, up from $20.72 billion in 2016.

Cash provided by operating activities improved $61 million to $1.3 billion , and free cash flow improved $77 million to $707 million, compared to the prior year.

Whirlpool said it expects to deliver net income of $12.45 to #13.45 a share in 2018. Also in 2018, the company said it expects to generate cash provided by operating activities of approximately $1.7 billion to $1.8 billion and free cash flow (3) of approximately $1.0 billion to $1.1 billion .

Whirlpool North America reported fourth -quarter net sales of $3.1 billion, flat from a year earlier. Excluding the impact of currency, sales decreased 0.8 percent. The region reported fourth -quarter operating profit of $368 million, or 11.8 percent of sales, compared to $349 million, or 11.2 percent of sales, in the same prior-year period. During the quarter, favorable product price/mix more than offset raw material inflation.

Whirlpool Europe, Middle East and Africa reported fourth -quarter net sales of $1.4 billion , an increase of 1.5 percent compared to the same prior-year period. Excluding the impact of currency, sales decreased 5.6 percent. The region reported fourth-quarter GAAP operating profit of $4 million, or 0.3 percent of sales, compared to GAAP operating profit of $17 million, or 1.3 percent of sales, in the same prior-year period. Ongoing segment operating profit was $4 million, or 0.3 percent of sales, compared to $ 45 million, or 3.3 percent of sales, in the same prior-year period. During the quarter, unfavorable product price/mix and raw material inflation more than offset favorable cost productivity and restructuring benefits.

Whirlpool Latin America reported fourth -quarter net sales of $905 million, up from $860 million in the same prior-year period, an increase of 5.2 percent. Excluding the impact of currency, sales increased 4.4 percent. The region reported fourth-quarter operating profit of $64 million, 7.1 percent of sales, compared to $71 million, or 8.3 percent of sales, in the same prior-year period. During the quarter, raw material inflation was partially offset by cost productivity and the sale and monetization of certain tax credits.

Whirlpool Asia reported fourth -quarter net sales of $333 million, down from $352 million in the same prior-year period. Excluding the impact of currency, sales decreased 8.3 percent. The region reported a fourth-quarter GAAP operating loss of $1 million, or 0.4 percent of sales, compared to GAAP operating profit of $18 million, or 4.9 percent of sales, in the same prior-year period. On a GAAP and ongoing basis, favorable impacts from product price/mix were more than offset by unit volume declines and raw material inflation.

“We are confident that our cost reduction initiatives and global price/mix will be a catalyst for significant margin improvements in the coming year,” said Jim Peters, chief financial officer of Whirlpool. “As a result, we expect to achieve our cash conversion goal and continue returning strong levels of cash to shareholders.”

More at whirlpoolcorp.com.

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