Whirlpool Corporation announced that second-quarter 2007 net sales increased 3% to US$4.9 billion. Net earnings from continuing operations were $161 million, or $2.00 per diluted share, up approximately 60% from the $100 million, or $1.26 per diluted share, reported in the same period last year.
Whirlpool said that earnings from continuing operations for the second quarter reflect strong operating profit improvement within each of the company's international business segments, the benefit from efficiencies associated with last year's acquisition of Maytag, productivity improvements, strong cost controls, favorable currency and a lower effective tax rate. Results were adversely affected by significantly higher material costs, lower industry shipments within the U.S., increased brand investment and a pension curtailment charge. Each regional business increased year-over-year operating profit margins during the quarter.
Whirlpool North America reported second-quarter revenue of $3.0 billion, down approximately 6% versus the year-ago period primarily due to lower OEM shipments and industry demand. Operating profit of $179 million for the quarter improved over the prior year despite significant material cost increases, primarily for base metals, component parts and steel, lower industry demand, increased brand investment in support of the Maytag launch of new innovative products and a pension curtailment charge. Based on current economic conditions, the company continues to expect full-year 2007 U.S. industry unit shipments to decline approximately 2 to 3%.
Whirlpool Europe reported record second-quarter revenue and operating profit. Revenue increased 10 % to $900 million driven by strong Whirlpool brand sales performance and the impact from innovative new product offerings. Excluding currency translation, sales increased by 3%. Industry demand during the quarter was estimated to have increased 2 to 3%. Operating profit of $51 million increased 20% for the quarter and margins expanded as a favorable mix, productivity improvements and reduced benefit expenses offset higher material costs during the quarter. Based on current economic conditions in Europe, the company continues to expect full-year industry unit shipments to increase approximately 2 to 3%.
Whirlpool Latin America reported record second-quarter revenue and operating profit. Revenue of $822 million grew 29% from last year driven by strong industry growth in appliances, favorable economic conditions in Brazil, cost-based price adjustments, and strong demand for the region's top-selling innovative brands. Excluding currency translations, sales for appliances and compressors increased approximately 18%. Regional unit shipments of appliances grew by 22% while industry unit shipments were estimated to have increased 18% during the quarter. Based on the current economic environment in Brazil, the company continues to expect full-year 2007 appliance industry shipments to increase 15 to 20%.
Whirlpool Asia reported sales of $163 million, an increase of 23% from the prior-year period. Excluding the impact of currency, sales increased approximately 13%. Increased operating profit during the quarter was led by very strong growth in India. The region benefited from successful new product introductions, an improved product mix and cost-based price increases implemented to mitigate higher material costs. Based on current economic conditions in Asia, the company continues to expect 2007 industry unit shipments to increase 5 to 10%.
For the balance of the year, Whirlpool continues to expect strong performance within its international businesses. Increasing U.S. industry demand, acquisition efficiencies, Whirlpool said productivity improvements and Maytag product launches are expected to improve performance within North America during the second half of the year.
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