-- Europe transaction closed on April
1st; expected to deliver $750M+ net present value of future
cash flows and $250-$300M incremental cash flow in 2025
-- Strong Q1 performance from Latin
America, Asia, and SDA
Global driven by share gains and cost performance, offset by
challenging macro environment in North
America, as expected
-- Announced ~5% increase to all promotional program prices in
MDA North America
-- Declared $1.75 dividend per
share in both Q1 & Q2; repaid $500
million of term loan in April
-- Q1 GAAP net earnings margin of (5.8)% compared to prior year
period of (3.9)%, impacted by a non-cash charge related to the
Europe transaction; GAAP loss per diluted share of $(4.72)
-- Ongoing (non-GAAP) EBIT margin(1) of 4.3%; ongoing
earnings per diluted share(2) of $1.78
-- Expect full-year GAAP earnings per diluted share of
$5.00 to $7.00 impacted by the non-cash charge related to
the Europe transaction
-- Reaffirming full-year ongoing earnings per diluted
share(2) of $13.00 to
$15.00, cash provided by operating
activities of $1.15 to $1.25 billion and free cash flow(3) of
$550 to $650
million
BENTON
HARBOR, Mich., April 24,
2024 /PRNewswire/ -- Whirlpool Corporation
(NYSE: WHR), today reported first-quarter 2024 financial
results.
"The closing of the Europe transaction marks a critical
portfolio transformation milestone," said Marc Bitzer. "We saw strong performance in
Global SDA as well as our international businesses, and announced
promotional program price increases in MDA North America consistent
with the value of our products and brands to address sticky
inflation."
MARC BITZER, CHAIRMAN AND CHIEF
EXECUTIVE OFFICER
First-Quarter
Results
|
2024
|
2023
|
Change
|
Net sales
($M)
|
$4,490
|
$4,649
|
(3.4) %
|
Net sales excluding
currency ($M)
|
$4,446
|
$4,649
|
(4.4) %
|
GAAP net earnings
(loss) available to Whirlpool ($M)
|
$(259)
|
$(179)
|
(44.7) %
|
Ongoing
EBIT(1) ($M)
|
$195
|
$251
|
(22.3) %
|
GAAP earnings (loss)
per diluted share
|
$(4.72)
|
$(3.27)
|
(44.3) %
|
Ongoing earnings per
diluted share(2)
|
$1.78
|
$2.66
|
(33.1) %
|
|
|
|
|
Free Cash
Flow
|
2024
|
2023
|
Change
|
Cash provided by (used
in) operating activities ($M)
|
$(873)
|
$(477)
|
$(396)
|
Free cash
flow(3) ($M)
|
$(988)
|
$(573)
|
$(415)
|
"During 2024, we have demonstrated our commitment to our
capital allocation priorities," said Jim Peters. "We have launched
several new products, declared very strong dividends in Q1 and Q2,
and repaid $500 million of our
maturing term loan."
JIM PETERS, CHIEF FINANCIAL AND
ADMINISTRATIVE OFFICER
SEGMENT REVIEW
SEGMENT INFORMATION
($M)
|
|
Q1
2024
|
Q1
2023
|
Change
|
MDA North
America
|
Net Sales
|
|
$2,428
|
$2,641
|
(8.1) %
|
EBIT
|
|
$135
|
$266
|
(49.2) %
|
% of sales
|
|
5.6 %
|
10.1 %
|
(4.5pts)
|
MDA
Europe
|
Net Sales
|
|
$804
|
$846
|
(5.0) %
|
EBIT
|
|
$(9)
|
$(5)
|
(80.0) %
|
% of sales
|
|
(1.1) %
|
(0.6) %
|
(0.5pts)
|
MDA Latin
America
|
Net Sales
|
|
$837
|
$747
|
12.0 %
|
EBIT
|
|
$65
|
$36
|
80.6 %
|
% of sales
|
|
7.8 %
|
4.8 %
|
3.0pts
|
MDA
Asia
|
Net Sales
|
|
$239
|
$245
|
(2.4) %
|
EBIT
|
|
$11
|
$8
|
37.5 %
|
% of sales
|
|
4.6 %
|
3.3 %
|
1.3pts
|
SDA
Global
|
Net Sales
|
|
$182
|
$170
|
7.1 %
|
EBIT
|
|
$33
|
$19
|
73.7 %
|
% of
sales
|
|
18.1 %
|
11.2 %
|
6.9pts
|
MDA: Major Domestic
Appliances; SDA: Small Domestic Appliances
|
|
MDA NORTH AMERICA
- Excluding currency, net sales decline of 8.1 percent
year-over-year from unfavorable price/mix and industry decline of
approximately 2 percent
- EBIT margin(4) decreased compared to the same
prior-year period, driven by promotional environment partially
offset by cost take out actions
MDA EUROPE
- Excluding currency, net sales decline of 6.9 percent
year-over-year, impacted by continued demand weakness in
Europe
- EBIT margin(4) decreased compared to the same
prior-year period, driven by unfavorable price/mix
MDA LATIN AMERICA
- Excluding currency, net sales increase of 8.4 percent
year-over-year, with strong share gains in the region more than
offsetting unfavorable price/mix
- EBIT margin(4) increased compared to the same
prior-year period, driven by incremental volumes and cost actions;
Q1 includes approximately 200 bps operating tax benefit
MDA ASIA
- Excluding currency, net sales decrease of 1.7 percent
year-over-year, with increased volumes from share gains more than
offset by unfavorable price/mix
- EBIT margin(4) increased compared to the same
prior-year period, driven by cost take out actions partially offset
by negative price/mix
SDA GLOBAL
- Excluding currency, net sales increase of 6.5 percent
year-over-year, with growth throughout key countries and direct to
consumer business more than offsetting unfavorable price/mix
- EBIT margin(4) increased compared to the same
period, driven by cost actions and volume growth
FULL-YEAR 2024 OUTLOOK
Guidance
Summary
|
2023
Reported
|
2023 Like for
Like (5)
|
2024
Guidance
|
Net sales
($M)
|
$19,455
|
~$16,900
|
~$16,900
|
Cash provided by
operating activities
($M)
|
$915
|
N/A
|
$1,150 -
$1,250
|
Free cash flow
($M)(3)
|
$366
|
N/A
|
$550 -
$650
|
GAAP net earnings
margin (%)
|
2.5 %
|
N/A
|
~2.0%
|
Ongoing EBIT margin
(%)(1)
|
6.1 %
|
~6.9%
|
~6.8%
|
GAAP earnings per
diluted share
|
$8.72
|
N/A
|
$5.00 -
$7.00
|
Ongoing earnings per
diluted share(2)
|
$16.16
|
N/A
|
$13.00 -
$15.00
|
- Europe transaction closed April 1,
2024, as expected, and full year guidance includes MDA
Europe first-quarter net sales of $804
million and EBIT of (1.1)%
- Reaffirming full-year 2024 net sales expectations of
approximately $16.9 billion
- Full-year GAAP earnings per diluted share of $5.00 to $7.00
impacted by non-cash charge related to the Europe transaction
- Reaffirming full-year ongoing earnings per diluted
share(2) of $13.00 to
$15.00, including $300-$400 million
of cost actions
- Reaffirming full-year cash provided by operating activities of
$1.15 to $1.25
billion and free cash flow(3) of approximately
$550 to $650
million; includes approximately $200
million of MDA Europe cash usage in 2024
- Expect full-year 2024 GAAP tax rate of approximately 25 percent
and adjusted (non-GAAP) tax rate of approximately 0 percent
- Continue to expect to pay approximately $400 million of 2024 dividends (subject to board
approval)
(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)
|
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 $(322) million and
$(357) million for the first quarters of 2024 and 2023,
respectively.
|
|
|
(5)
|
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 our
2024 financial performance, supply chain, cost take out, raw
material, portfolio transformation, transaction-related synergies,
benefits from previously announced actions and future cash flow
expectations 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: 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 MARCH 31
(Millions of
dollars, except per share data)
|
|
|
Three Months
Ended
|
|
2024
|
|
2023
|
Net
sales
|
$
4,490
|
|
$
4,649
|
Expenses
|
|
|
|
Cost of products
sold
|
3,848
|
|
3,886
|
Gross
margin
|
642
|
|
763
|
Selling, general and
administrative
|
477
|
|
487
|
Intangible
amortization
|
11
|
|
11
|
Restructuring
costs
|
23
|
|
—
|
Loss (gain) on sale and
disposal of businesses
|
247
|
|
222
|
Operating (loss)
profit
|
(116)
|
|
43
|
Other (income)
expense
|
|
|
|
Interest and sundry
(income) expense
|
(29)
|
|
77
|
Interest
expense
|
90
|
|
75
|
Earnings (loss) before
income taxes
|
(177)
|
|
(109)
|
Income tax expense
(benefit)
|
76
|
|
68
|
Equity method
investment income (loss), net of tax
|
—
|
|
1
|
Net earnings
(loss)
|
(253)
|
|
(176)
|
Less: Net earnings (loss) available to noncontrolling
interests
|
6
|
|
3
|
Net earnings (loss)
available to Whirlpool
|
$
(259)
|
|
$
(179)
|
Per share of common
stock
|
|
|
|
Basic net earnings
(loss) available to Whirlpool
|
$
(4.72)
|
|
$
(3.27)
|
Diluted net earnings
(loss) available to Whirlpool
|
$
(4.72)
|
|
$
(3.27)
|
Dividends
declared
|
$
1.75
|
|
$
1.75
|
Weighted-average
shares outstanding (in millions)
|
|
|
|
Basic
|
54.9
|
|
54.8
|
Diluted
|
54.9
|
|
54.8
|
WHIRLPOOL
CORPORATION
CONSOLIDATED
CONDENSED BALANCE SHEETS
(Millions of
dollars, except share data)
|
|
|
March 31,
2024
|
|
December
31, 2023
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
1,231
|
|
$
1,570
|
Accounts receivable,
net of allowance of $49 and $47, respectively
|
1,707
|
|
1,529
|
Inventories
|
2,381
|
|
2,247
|
Prepaid and other
current assets
|
646
|
|
717
|
Assets held for
sale
|
227
|
|
144
|
Total current
assets
|
6,192
|
|
6,207
|
Property, net of
accumulated depreciation of $5,322 and $5,259,
respectively
|
2,240
|
|
2,234
|
Right of use
assets
|
859
|
|
721
|
Goodwill
|
3,328
|
|
3,330
|
Other intangibles, net
of accumulated amortization of $449 and $440,
respectively
|
3,115
|
|
3,124
|
Deferred income
taxes
|
1,283
|
|
1,317
|
Other noncurrent
assets
|
353
|
|
379
|
Total assets
|
$
17,370
|
|
$
17,312
|
Liabilities and
stockholders' equity
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
3,404
|
|
$
3,598
|
Accrued
expenses
|
459
|
|
491
|
Accrued advertising
and promotions
|
446
|
|
603
|
Employee
compensation
|
152
|
|
238
|
Notes
payable
|
500
|
|
17
|
Current maturities of
long-term debt
|
500
|
|
800
|
Other current
liabilities
|
512
|
|
614
|
Liabilities held for
sale
|
577
|
|
587
|
Total current
liabilities
|
6,550
|
|
6,948
|
Noncurrent
liabilities
|
|
|
|
Long-term
debt
|
6,674
|
|
6,414
|
Pension
benefits
|
136
|
|
147
|
Postretirement
benefits
|
105
|
|
107
|
Lease
liabilities
|
759
|
|
612
|
Other noncurrent
liabilities
|
536
|
|
547
|
Total noncurrent
liabilities
|
8,210
|
|
7,827
|
Stockholders'
equity
|
|
|
|
Common stock, $1 par
value, 250 million shares authorized, 114 million and
114 million shares issued, respectively, and 55 million and 55
million shares
outstanding, respectively
|
114
|
|
114
|
Additional paid-in
capital
|
3,448
|
|
3,078
|
Retained
earnings
|
8,004
|
|
8,358
|
Accumulated other
comprehensive loss
|
(2,157)
|
|
(2,178)
|
Treasury stock, 60
million and 60 million shares, respectively
|
(7,055)
|
|
(7,010)
|
Total Whirlpool
stockholders' equity
|
2,354
|
|
2,362
|
Noncontrolling
interests
|
256
|
|
175
|
Total stockholders'
equity
|
2,610
|
|
2,537
|
Total liabilities and
stockholders' equity
|
$
17,370
|
|
$
17,312
|
WHIRLPOOL
CORPORATION
CONSOLIDATED
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE PERIODS
ENDED MARCH 31
(Millions of
dollars)
|
|
|
Three Months
Ended
|
|
2024
|
|
2023
|
Operating
activities
|
|
|
|
Net earnings
(loss)
|
$
(253)
|
|
$
(176)
|
Adjustments to
reconcile net earnings to cash provided by (used in) operating
activities:
|
|
|
|
Depreciation and
amortization
|
89
|
|
89
|
Loss (gain) on sale and
disposal of businesses
|
247
|
|
222
|
Changes in assets and
liabilities:
|
|
|
|
Accounts
receivable
|
(266)
|
|
(155)
|
Inventories
|
(113)
|
|
(284)
|
Accounts
payable
|
(236)
|
|
(24)
|
Accrued advertising
and promotions
|
(199)
|
|
(229)
|
Accrued expenses and
current liabilities
|
(122)
|
|
99
|
Taxes deferred and
payable, net
|
65
|
|
43
|
Accrued pension and
postretirement benefits
|
(8)
|
|
(14)
|
Employee
compensation
|
(64)
|
|
3
|
Other
|
(13)
|
|
(51)
|
Cash provided by (used
in) operating activities
|
(873)
|
|
(477)
|
Investing
activities
|
|
|
|
Capital
expenditures
|
(115)
|
|
(96)
|
Acquisition of
businesses, net of cash acquired
|
—
|
|
(14)
|
Cash provided by (used
in) investing activities
|
(115)
|
|
(110)
|
Financing
activities
|
|
|
|
Net proceeds from
borrowings of long-term debt
|
300
|
|
303
|
Net proceeds
(repayments) of long-term debt
|
(300)
|
|
(250)
|
Net proceeds
(repayments) from short-term borrowings
|
501
|
|
9
|
Dividends
paid
|
(95)
|
|
(97)
|
Repurchase of common
stock
|
(50)
|
|
—
|
Sale of minority
interest in subsidiary
|
462
|
|
—
|
Common stock
issued
|
—
|
|
1
|
Other
|
—
|
|
(4)
|
Cash provided by (used
in) financing activities
|
818
|
|
(38)
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
(20)
|
|
27
|
Less: change in cash
classified as held for sale
|
(149)
|
|
(1)
|
Increase (decrease) in
cash, cash equivalents and restricted cash
|
(339)
|
|
(599)
|
Cash, cash equivalents
and restricted cash at beginning of year
|
1,570
|
|
1,958
|
Cash, cash equivalents
and restricted cash at end of period
|
$
1,231
|
|
$
1,359
|
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" measures. These measures may include earnings
before interest and taxes (EBIT), EBIT margin, ongoing EBIT,
ongoing EBIT margin, ongoing earnings per diluted share, adjusted
effective tax rate, organic net sales, net debt leverage (Net
Debt/Ongoing EBITDA), return on invested capital (ROIC) and free
cash flow.
Ongoing measures exclude items that may not be indicative of, or
are unrelated to, results from our ongoing operations and provide a
better baseline for analyzing trends in our underlying
businesses.
Sales excluding foreign currency: Current period net
sales translated in functional currency, to U.S. dollars using the
applicable prior period's exchange rate compared to the applicable
prior period net sales. Management believes that sales excluding
foreign currency provides stockholders with a clearer basis to
assess our results over time, excluding the impact of exchange rate
fluctuations.
Organic net sales: Sales excluding the impact of certain
acquisitions or divestitures, and foreign currency. Management
believes that organic net sales provides stockholders with a
clearer basis to assess our results over time, excluding the impact
of exchange rate fluctuations and certain acquisitions and/or
divestitures.
Ongoing EBIT margin: Ongoing earnings before interest and
taxes divided by net sales. Ongoing measures exclude items that may
not be indicative of, or are unrelated to, results from our ongoing
operations and provide a better baseline for analyzing trends in
our underlying businesses.
Ongoing earnings per diluted share: Diluted net earnings per
share from continuing operations, adjusted to exclude items that
may not be indicative of, or are unrelated to, results from our
ongoing operations. Ongoing measures provide a better baseline for
analyzing trends in our underlying businesses.
Net debt leverage: Net debt to ongoing earnings before
interest, taxes, depreciation, and amortization (EBITDA) ratio is
net debt outstanding, including long-term debt, current maturities
of long-term debt, and notes payable, less cash and cash
equivalents, divided by ongoing EBITDA. Management believes that
net debt leverage provides stockholders with a view of our ability
to generate earnings sufficient to service our debt.
Return on invested capital: Ongoing EBIT after taxes divided
by total invested capital, defined as total assets less
non-interest bearing current liabilities (NIBCLS). NIBCLS is
defined as current liabilities less current maturities of long-term
debt and notes payable. This ROIC definition may differ from other
companies' methods and therefore may not be comparable to those
used by other companies. Management believes that ROIC provides
stockholders with a view of capital efficiency, a key driver of
stockholder value creation.
Adjusted effective tax rate: Effective tax rate, excluding
pre-tax income and tax effect of certain unique items. Management
believes that adjusted tax rate provides stockholders with a
meaningful, consistent comparison of the Company's effective tax
rate, excluding the pre-tax income and tax effect of certain unique
items.
Free cash flow: Cash provided by (used in) operating
activities less capital expenditures. Management believes that free
cash flow provides stockholders with a relevant measure of
liquidity and a useful basis for assessing the company's ability to
fund its activities and obligations.
Whirlpool does not provide a non-GAAP reconciliation for its
forward-looking long-term value creation goals, such as organic net
sales, EBIT, free cash flow conversion, future year free cash flow
benefit as a result of Europe transaction closing, ROIC and net
debt leverage, as these long-term management goals are not annual
guidance, and the reconciliation of these long-term measures would
rely on market factors and certain other conditions and assumptions
that are outside of the company's control.
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, and reflect an additional way of viewing aspects of
our operations that, when viewed with our GAAP financial measures,
provide a more complete understanding of our business. 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 financial measures should not be considered in isolation or
as a substitute for reported net earnings available to Whirlpool
per diluted share, net earnings, net earnings available to
Whirlpool, net earnings margin, return on assets, net sales,
effective tax rate and cash provided by (used in) operating
activities, the most directly comparable GAAP financial
measures.
We also disclose segment EBIT as an important financial metric
used by the Company's Chief Operating Decision Maker to evaluate
performance and allocate resources in accordance with ASC 280 -
Segment Reporting.
GAAP net earnings available to Whirlpool per basic or diluted
share (as applicable) and ongoing earnings per diluted share are
presented net of tax, while individual adjustments in each
reconciliation are presented on a pre-tax basis; the income tax
impact line item aggregates the tax impact for these adjustments.
The tax impact of individual line item adjustments may not foot
precisely to the aggregate income tax impact amount, as each line
item adjustment may include non-taxable components. Historical
quarterly earnings per share amounts are presented based on a
normalized tax rate adjustment to reconcile quarterly tax rates to
full-year tax rate expectations. 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.
FIRST-QUARTER 2024 ONGOING EARNINGS BEFORE INTEREST AND TAXES
AND ONGOING EARNINGS PER DILUTED SHARE
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing earnings before interest and taxes and
ongoing earnings per diluted share, with the most directly
comparable GAAP financial measures, net earnings (loss) available
to Whirlpool and net earnings (loss) per diluted share available to
Whirlpool, for the three months ended March
31, 2024. Net earnings (loss) margin is calculated by
dividing net earnings (loss) available to Whirlpool by net sales.
Ongoing EBIT margin is calculated by dividing ongoing EBIT by net
sales. EBIT margin is calculated by dividing EBIT by net sales. The
earnings per diluted share GAAP measure and ongoing measure are
presented net of tax, while each adjustment is presented on a
pre-tax basis. Our first-quarter GAAP tax rate was 42.9%. The
aggregate income tax impact of the taxable components of each
adjustment is presented in the income tax impact line item at our
first-quarter adjusted tax rate (non-GAAP) of 0.0%.
|
Three Months
Ended
|
Earnings Before
Interest & Taxes Reconciliation:
|
March 31,
2024
|
Net earnings (loss)
available to Whirlpool
|
$
(259)
|
Net earnings (loss)
available to noncontrolling interests
|
6
|
Income tax expense
(benefit)
|
76
|
Interest
expense
|
90
|
Earnings before
interest & taxes
|
$
(87)
|
Net sales
|
$
4,490
|
Net earnings (loss)
margin
|
(5.8) %
|
|
Results
classification
|
|
Earnings before
interest & taxes
|
|
Earnings per
diluted share
|
Reported
measure
|
|
|
$
(87)
|
|
$
(4.72)
|
Restructuring
expense(a)
|
Restructuring
expense
|
|
23
|
|
0.41
|
Impact of M&A
transactions(b)
|
(Gain) loss on sale
and
disposal of businesses &
Selling, general and
administrative
|
|
259
|
|
4.72
|
Total income tax
impact
|
|
|
|
|
—
|
Normalized tax rate
adjustment(d)
|
|
|
|
|
1.37
|
Ongoing
measure
|
|
|
$
195
|
|
$
1.78
|
Net sales
|
|
|
$
4,490
|
|
|
Ongoing EBIT
margin
|
|
|
4.3 %
|
|
|
Note: Numbers may not reconcile due to rounding; As a result of
our current period GAAP earnings loss, the impact of antidilutive
shares was excluded from the loss per share calculation on a GAAP
basis. The share count adjustment used in the calculation of the
first-quarter ongoing earnings per diluted share includes basic
shares outstanding of 54.9 million plus the impact of antidilutive
shares of 1.2 million which were excluded on a GAAP basis.
FIRST-QUARTER 2023 ONGOING EARNINGS BEFORE INTEREST AND TAXES
AND ONGOING EARNINGS PER DILUTED SHARE
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing earnings before interest and taxes and
ongoing earnings per diluted share, with the most directly
comparable GAAP financial measures, net earnings (loss) available
to Whirlpool and net earnings (loss) per basic share available to
Whirlpool, for the three months ended March
31, 2023. Net earnings (loss) margin is calculated by
dividing net earnings (loss) available to Whirlpool by net sales.
Ongoing EBIT margin is calculated by dividing ongoing EBIT by net
sales. EBIT margin is calculated by dividing EBIT by net sales. The
earnings per basic share GAAP measure and ongoing measure are
presented net of tax, while each adjustment is presented on a
pre-tax basis. Our first-quarter GAAP tax rate was (62.4)%. The
aggregate income tax impact of the taxable components of each
adjustment is presented in the income tax impact line item at our
first-quarter adjusted tax rate (non-GAAP) of 15.0%.
|
Three Months
Ended
|
Earnings Before
Interest & Taxes Reconciliation:
|
March 31,
2023
|
Net earnings (loss)
available to Whirlpool
|
$
(179)
|
Net earnings (loss)
available to noncontrolling interests
|
3
|
Income tax expense
(benefit)
|
68
|
Interest
expense
|
75
|
Earnings before
interest & taxes
|
$
(33)
|
Net sales
|
$
4,649
|
Net earnings (loss)
margin
|
(3.9) %
|
|
Results
classification
|
|
Earnings before
interest & taxes
|
|
Earnings per
diluted share
|
Reported
measure
|
|
|
$
(33)
|
|
$
(3.27)
|
Impact of M&A
transactions(b)
|
(Gain) loss on sale
and
disposal of businesses
|
|
222
|
|
4.05
|
Legacy EMEA legal
matters(c)
|
Interest and sundry
(income) expense
|
|
62
|
|
1.14
|
Total income tax
impact
|
|
|
|
|
(0.78)
|
Normalized tax rate
adjustment(d)
|
|
|
|
|
1.54
|
Share
adjustment*
|
|
|
|
|
(0.02)
|
Ongoing
measure
|
|
|
$
251
|
|
$
2.66
|
Net sales
|
|
|
$
4,649
|
|
|
Ongoing EBIT
margin
|
|
|
5.4 %
|
|
|
Note: Numbers may not reconcile due to rounding
*As a result of our current period GAAP earnings loss, the
impact of antidilutive shares was excluded from the loss per
share calculation on a GAAP basis. The share count adjustment
used in the calculation of the first-quarter ongoing earnings
per diluted share includes basic shares outstanding of 54.8
million plus the impact of antidilutive shares of 0.4 million which
were excluded on a GAAP basis.
FULL-YEAR 2024 OUTLOOK FOR ONGOING EARNINGS BEFORE INTEREST
AND TAXES AND ONGOING EARNINGS PER DILUTED SHARE
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing earnings before interest and taxes and
ongoing earnings per diluted share, with the most directly
comparable GAAP financial measures, net earnings available to
Whirlpool and net earnings per diluted share available to
Whirlpool, for the twelve months ending December 31, 2024. Net
earnings margin is calculated by dividing net earnings available to
Whirlpool by net sales. Ongoing EBIT margin is calculated by
dividing ongoing EBIT by net sales. EBIT margin is calculated by
dividing EBIT by net sales. The earnings per diluted share GAAP
measure and ongoing measure are presented net of tax, while each
adjustment is presented on a pre-tax basis. Our anticipated
full-year GAAP tax rate is approximately 25%. The aggregate income
tax impact of the taxable components of each adjustment is
presented in the income tax impact line item at our anticipated
full-year adjusted tax (non-GAAP) rate of approximately 0%.
|
Twelve Months
Ended
|
Earnings Before
Interest & Taxes Reconciliation:
|
December 31,
2024
|
Net earnings available
to Whirlpool
|
~$330
|
Net earnings available
to noncontrolling interests
|
~20
|
Income tax expense
(benefit)
|
~120
|
Interest
expense
|
~350
|
Earnings before
interest & taxes
|
~$820
|
Net sales
|
~$16,900
|
Net earnings
margin
|
~2.0%
|
|
Results
classification
|
|
Earnings before
interest & taxes
|
|
Earnings per
diluted share
|
Reported
measure
|
|
|
~$820
|
|
$5.00 -
$7.00
|
Restructuring
Expense
|
|
|
~50
|
|
∼1.00
|
Impact of M&A
transactions(b)
|
(Gain) loss on sale
and
disposal of businesses &
Selling, general and
administrative
|
|
~275
|
|
~5.00
|
Total income tax
impact
|
|
|
|
|
—
|
Normalized tax rate
adjustment(d)
|
|
|
|
|
∼2.00
|
Ongoing
measure
|
|
|
~$1,150
|
|
$13.00 -
$15.00
|
Note: Numbers may not reconcile due to rounding
FULL-YEAR 2023 ONGOING EARNINGS BEFORE INTEREST AND TAXES AND
ONGOING EARNINGS PER DILUTED SHARE
The reconciliation provided below reconciles the non-GAAP
financial measures ongoing earnings before interest and taxes and
ongoing earnings per diluted share, with the most directly
comparable GAAP financial measures, net earnings (loss) available
to Whirlpool and net earnings (loss) per diluted share available to
Whirlpool, for the twelve months ended December 31, 2023. Net
earnings (loss) margin is calculated by dividing net earnings
(loss) available to Whirlpool by
net sales. Ongoing EBIT margin is calculated by dividing ongoing
EBIT by net sales. EBIT margin is calculated by dividing EBIT by
net sales. The earnings per diluted share GAAP measure and ongoing
measure are presented net of tax, while each adjustment is
presented on a pre-tax basis. Our full-year GAAP tax rate was
13.0%. The aggregate income tax impact of the taxable components of
each adjustment is presented in the income tax impact line item at
our full-year adjusted tax (non-GAAP) rate of (6.7)%.
|
Twelve Months
Ended
|
Earnings Before
Interest & Taxes Reconciliation:
|
December 31,
2023
|
Net earnings (loss)
available to Whirlpool
|
$
481
|
Net earnings (loss)
available to noncontrolling interests
|
7
|
Income tax expense
(benefit)
|
77
|
Interest
expense
|
351
|
Earnings before
interest & taxes
|
$
916
|
Net sales
|
$
19,455
|
Net earnings (loss)
margin
|
2.5 %
|
|
Results
classification
|
|
Earnings before
interest & taxes
|
|
Earnings per
diluted share
|
Reported
measure
|
|
|
$
916
|
|
$
8.72
|
Impact of M&A
transactions(b)
|
(Gain) loss on sale
and
disposal of businesses &
Selling, general and
administrative & including
equity method investment
|
|
181
|
|
3.27
|
Legacy EMEA legal
matters(c)
|
Interest and sundry
(income) expense
|
|
94
|
|
1.71
|
Total income tax
impact
|
|
|
|
|
0.35
|
Normalized tax rate
adjustment(d)
|
|
|
|
|
2.11
|
Ongoing
measure
|
|
|
$
1,191
|
|
$
16.16
|
Net Sales
|
|
|
$
19,455
|
|
|
Ongoing EBIT
Margin
|
|
|
6.1 %
|
|
|
Note: Numbers may not reconcile due to rounding
FOOTNOTES
a. RESTRUCTURING EXPENSE - In March 2024, the Company committed to workforce
reduction plans. $23 million was
recorded during the first quarter, of which $14 million was employee termination costs and
$9 million was other associated exit
costs. For the full year 2024, we expect to incur approximately
$50 million of restructuring
charges.
b. IMPACT OF M&A TRANSACTIONS - On
January 16, 2023, we signed a
contribution agreement to contribute our European major domestic
appliance business into a newly formed entity with Arçelik. In
connection with the transaction, we recorded a loss on disposal of
$247 million for the three months
ended March 31, 2024. Additionally,
we incurred other unique transaction related costs related to
portfolio transformation for a total of $12 million for the
three months ended March 31, 2024.
These transaction costs are recorded in Selling, General and
Administrative expenses on our Consolidated Condensed Statements of
Comprehensive Income (Loss).
During the first quarter of 2023, we recorded an adjustment of
$222 million related to the loss on
disposal for the European major domestic appliance business
transaction. During the full year of 2023, we recorded a loss of
$106 million related to the planned
divestiture of our European major domestic appliance business for
the twelve months ended December 31,
2023. Additionally, we incurred other identifiable costs
related to portfolio transformation, totaling $75 million in 2023.
c. LEGACY MDA EUROPE LEGAL MATTERS - During
the first quarter of 2023, the Company accrued $62 million related to the France Competition
Investigation and Trade Customer Insolvency matters of our European
major domestic appliance business. The aggregate amount accrued by
the Company related to the France Competition Investigation and
other legacy legal matters of our European major domestic appliance
business was $94 million, for the
twelve months ended December 31,
2023.
d. NORMALIZED TAX RATE ADJUSTMENT - During
the first quarter of 2024, the Company calculated a GAAP tax rate
of 42.9%. Ongoing earnings per share was calculated using an
adjusted tax rate of 0.0%, which excludes the non-tax deductible
impact of M&A transactions of approximately $205 million
recorded in the first quarter of 2024. The Company expects a
full-year GAAP tax rate of approximately 25.0% and adjusted
effective tax rate of approximately 0.0%. During the first quarter
of 2023, the Company calculated ongoing earnings per share using an
adjusted tax rate of 15.0% which excludes the non-tax deductible
impact of M&A transactions of approximately $222 million recorded in the first quarter of
2023. During the full-year of 2023, the Company calculated ongoing
earnings per share using an adjusted tax rate of (6.7)% which
excludes the non-tax deductible impact of M&A transactions of
approximately $25 million recorded in the fourth quarter of
2023 and which reflects certain tax benefits related to legal
entity restructuring transactions in the fourth quarter of
2023.
Additionally, in the full-year 2024 outlook, the Company
calculated ongoing earnings per share using a full-year adjusted
tax (non-GAAP) rate of approximately 0.0%. The company expects to
recognize tax benefits, contingent upon the closure of the Europe
transaction, that are expected to provide a significant tax
benefit. Reconciling from our expected full-year GAAP tax rate of
approximately 25.0%, certain Europe transaction tax impacts have
been adjusted from our full-year adjusted tax (non-GAAP) rate of
approximately 0.0%.
ONGOING EBIT EXCLUDING MDA EUROPE SECOND QUARTER THROUGH
FOURTH QUARTER
The reconciliation provided below reconciles the impact of
removing MDA Europe from our Q2 through Q4 net sales and ongoing
EBIT, for twelve months ended December 31,
2023 for the Whirlpool business.
|
2023
As Reported
|
Q2-Q4 2023
MDA
Europe*
|
2023 Like
for Like
|
Net Sales (in
billions)
|
$
19.5
|
$
2.6
|
$
16.9
|
Ongoing EBIT (in
millions)
|
$
1,191
|
$
30
|
$
1,162
|
Ongoing EBIT
Margin
|
6.1 %
|
1.2 %
|
~6.9%
|
Note: Numbers may not reconcile due to rounding
*Q2-Q4 historical segment financial data (unaudited).
FREE CASH FLOW
Free cash flow is cash provided by (used in) operating
activities after capital expenditures. The reconciliation provided
below reconciles three months ended March
31, 2024 and 2023 and 2024 full-year free cash flow
with cash provided by (used in) operating activities, the most
directly comparable GAAP financial measure. Free cash flow as a
percentage of net sales is calculated by dividing free cash flow by
net sales.
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March 31,
|
|
|
(millions of
dollars)
|
2024
|
|
2023
|
|
2024
Outlook
|
Cash provided by (used
in) operating activities
|
$(873)
|
|
$(477)
|
|
$1,150 -
$1,250
|
Capital
expenditures
|
(115)
|
|
(96)
|
|
(600)
|
Free cash
flow
|
$(988)
|
|
$(573)
|
|
$550 - $650
|
|
|
|
|
|
|
Cash provided by (used
in) investing activities*
|
(115)
|
|
(110)
|
|
|
Cash provided by (used
in) financing activities*
|
818
|
|
(38)
|
|
|
*Financial guidance on a GAAP basis for cash provided by
(used in) financing activities and cash provided by (used in)
investing activities has not been provided because in order to
prepare any such estimate or projection, the Company would need to
rely on market factors and certain other conditions and assumptions
that are outside of its control.
Free cash flow is cash provided by (used in) operating
activities after capital expenditures. The reconciliation
provided below reconciles twelve months ended December 31, 2023 full-year free cash flow
with cash provided by (used in) operating activities, the most
directly comparable GAAP financial measure. Free cash flow as
a percentage of net sales is calculated by dividing free cash
flow by net sales.
|
|
|
Twelve Months
Ended
|
|
December 31,
|
(millions of
dollars)
|
2023
|
Cash provided by (used
in) operating activities
|
$915
|
Capital
expenditures
|
(549)
|
Free cash
flow
|
$366
|
|
|
Cash provided by (used
in) investing activities
|
(553)
|
Cash provided by (used
in) financing activities
|
(792)
|
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SOURCE Whirlpool Corporation