Despite clocking in with lower than expected earnings this morning, Whirlpool Corporation is maintaining its full year guidance, expecting 2016 earnings to rank from $14 to $14.75 per share when all is said and done. In the meantime, the earnings report triggered an early plunge in stock prices this morning of some $12-per share by mid-morning.
The Benton Harbor-based appliance giant announced this morning first-quarter GAAP net earnings of $150-million, or $1.92 per diluted share, compared to $191-million, or $2.38 per diluted share in the same year ago period. Ongoing business earnings per diluted share totaled a first-quarter record $2.63 compared to $2.14 in the same prior-year period, primarily driven by acquisition synergies, the benefits of cost and capacity-reduction initiatives and ongoing cost productivity.
Net sales in the quarter were $4.6-billion compared to $4.8-billion during the same prior-year period, however excluding the impact of currency, sales increased by 1-percent.
Chairman & CEO Jeff Fettig says, "Our record first-quarter results were in line with our expectations and we completed our existing share repurchase program." He adds, "We remain confident in our ability to deliver our 2016 guidance as we capitalize on robust demand in the U.S., new product introductions and strong productivity around the globe."
First quarter GAAP operating profit totaled #238-million compared to $303-million in the same quarter a year ago. Record first-quarter ongoing business operating profit totaled $339-million, or approximately 7.3-percent of sales, compared to $318-million, or 6.6-percent of sales, in the same prior-year period. The company says acquisition synergies, the benefits of cost and capacity-reduction initiatives, and ongoing cost productivity more than offset unfavorable currency and weak emerging market demand.
For the full year of 2016, Whirlpool execs expect to report GAAP earnings per diluted share of $11.25 to $12.00 and ongoing business earnings per diluted share of $14.00 to $14.75.
Additionally, for the full year 2016, the company expects to generate free cash flow of $700 to $800-million. CEO Fettig says, "Our strategy to create long-term value for our shareholders remains unchanged. We remain focused on delivering substantial shareholder value by leveraging our leading brand and product innovation, larger global footprint and best cost structure." He adds, "In addition to our strong business performance, with our $1-billion share repurchase program and increased dividend we have appropriate flexibility to deliver on our capital allocation priorities."
Sales in North America rose about 4-percent from $2.3-billion up to $2.4-billion and they expect full year industry shipments for 2016 to increase by 5 to 6-percent in North America.
European sales, including the Middle East and Africa saw sales slide to $1.2-billion compared to $1.3-billion a year ago.
Sales were also lower in Latin America and Asia, however Asian sales were impacted by unfavorable currency exchange rates, which, if factored out, actually produced a 3-percent rise in sales.
In the first quarter alone, Whirlpool was named by Fortune Magazine as one of the World's Most Admired Companies, the EPA recognized the company with the 2016 Energy Star Partner of the Year – Product Brand Owner Award, three KitchenAid brand dishwashers were awarded the top spot as ranked by an industry leading consumer magazine in the U.S., the Whirlpool brand garnered nine International Consumer Electronics Show Innovation Awards, the KitchenAid Torrent Magnetic Drive Blender was selected by Red Dot as a winner in the "Best of the Best" award for ground-breaking product design, and Bauknecht brand PremiumCare washers and dryers received the iF Design Award for Design Excellence.
