Appliance maker Whirlpool Corporation (Benton Harbor, MI, U.S.) announced second-quarter financial results, highlighted by record second-quarter revenue and a 13-percent increase in earnings per share.
Second-quarter 2004 net earnings were U.S. $106 million, or $1.53 per diluted share, compared to $94 million, or $1.35 per diluted share, in the same period of 2003. Second-quarter net sales of $3.26 billion increased 9.2 percent from the same period last year. Excluding currency translations, net sales increased approximately 8 percent.
"Our second-quarter results reflect the continuing strong momentum in our North American and European businesses, and improving conditions in Latin America," said Jeff Fettig, Whirlpool's chairman, president and CEO. "Demand has been strong in all markets, but rising material costs, material availability, and transportation constraints have made this a challenging operating environment. Our global operations effectively managed these issues during the quarter, which led to our strong performance."
For the first half of 2004, sales of $6.27 billion increased 9.9 percent from the prior-year period. Excluding currency translations, year-to-date sales increased approximately 7 percent. Year-to-date earnings of $2.96 per diluted share improved 10.9 percent from the first half of 2003.
Whirlpool North America's sales of $2.1 billion increased 6.9 percent from the prior-year period. U.S. industry unit shipments of major appliances increased 9.3 percent from the prior-year period. Based on current economic conditions, the company now expects full-year U.S. industry shipments to increase 5-to-6 percent from last year's level.
Whirlpool Europe's sales of $704 million increased 12.1 percent from the prior-year period. Second-quarter industry unit shipments increased 3 percent from the prior-year period. Based on current economic conditions, the company expects full-year industry shipments to increase approximately 2-to-3 percent.
Whirlpool Latin America's sales of $392 million increased 23 percent from the prior-year period. Second-quarter industry unit shipments in Brazil increased approximately 28 percent from the prior-year period. Based on current economic conditions, the company expects full-year industry unit shipments to increase approximately 12-to-15 percent from last year's level.
Whirlpool Asia's sales of $110 million declined 6.4 percent from the prior-year period. During the quarter, Whirlpool Asia continued to ramp up its capabilities as a source of procurement, technology and exports for the company's other global operations. Based on current economic conditions, the company continues to expect full-year industry unit shipments to increase by 5-to-7 percent.
The company announced plans to invest approximately $180 million in its North America operations for the continued development and introduction of innovative products. Approximately $100 million of the investment will fund initiatives at seven manufacturing facilities in the U.S. Approximately $80 million will fund activities in Mexico to expand the company's washer production facility in Monterrey and construct a new refrigeration facility in Ramos Arizpe.
Whirlpool also announced a 100 million Euro investment in its manufacturing site located in Wroclaw, Poland. The investment will fund a new cooking manufacturing capability and expand the company's existing refrigeration and dishwasher production lines.
"We continue to expect to deliver a record year of revenues and full-year earnings in the range of $6.20 to $6.35 per share for 2004," Mr. Fettig said. "The expected performance is based on the strong demand for our global innovative products and brands, and our second-half outlook for key markets around the world. The guidance incorporates the external challenges of raw material costs, material supply availability and transportation constraints, as well as the planned investments in the company's global operating platform. Our operations are positioned to successfully manage these issues and deliver a record year of performance."
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