Home
Global Supplier Directory
APPLIANCE Engineer
Supplier Solutions
APPLIANCE Line
Whitepaper Library
Calendar of Events
Association Locator
Contents Pages
Market Research
Subscription Center


 
Daily News

Maytag Earnings Significantly Lower Than Expected
Sep 20, 2005
 Printable format
 Email this Article
 Search

Maytag Corporation (Newton, Iowa, U.S.) said that results for the third quarter and full-year 2005 will be significantly lower than expected in its earlier guidance. Maytag blamed the results on higher costs -- high manufacturing overhead, increasing distribution and fuel expenses, and rising raw material costs.

"Although we are disappointed in these cost increases, our top-line sales projections are strong compared to last year," noted Maytag Chairman and CEO Ralph F. Hake. He pointed out that, despite uncertainty over Maytag's pending sales, it achieved high single-digit sales growth in major appliances through the first 2 months of the third quarter. He also noted that excess manufacturing capacity remains one of the biggest issues impacting Maytag's earnings.

"Our fixed cost structure remains a barrier to acceptable financial performance, and we intend to address this issue," Hake said. "The actions we take might require restructuring charges, including asset write-offs, accelerated depreciation and certain cash costs. These actions will need to be undertaken irrespective of the pending merger with Whirlpool."

An unfavorable product/pricing mix, primarily in floor care, also continues to hurt results. The pending acquisition by Whirlpool leads Maytag to expect significant merger and acquisition expenses in the third and fourth quarters of this year. As a result, Maytag projects that full-year 2005 results will be significantly lower than the guidance it previously provided, and it expects to report a loss before any restructuring charges in the third quarter.

Due to the current business performance and uncertainty associated with the manufacturing restructuring, Maytag said it will no longer provide any earnings guidance.

Given that the merger with Whirlpool may not close prior to the first quarter of 2006, Maytag will move forward to complete the new asset-based, U.S. $600 million, 5-year senior secured revolving credit facility contemplated by the commitment letter, as announced by Maytag in June 2005. It expires Dec. 30, 2005. The new facility will replace the current $300 million credit facility and it is expected to be completed early in the fourth quarter of 2005. The new credit facility is expected to be led by J.P. Morgan Chase Bank, N.A. and Citigroup Global Markets, Inc. and secured by accounts receivable and inventory of some Maytag subsidiaries.

Maytag plans to announce third quarter 2005 sales and earnings results on Friday, Oct. 21, 2005.

Back to Daily News

 

Daily News

...........................................................

Jul 29, 2014: Jarden Reports Record Net Sales in 2Q

Jul 29, 2014: LG USA Names VanderWaal to Head Marketing

Jul 29, 2014: Smart Meters May Provide An Entrance Point for Cyber Attacks on the Connected Home

Jul 29, 2014: TCL Will Manufacture Portable HVAC Equipment for Soleus Air

Jul 29, 2014: HVACR Contractors Outlook Remains Positive

More Daily News>>

RSS Feeds
.........................................................
Appliance Industry
Market Research

...........................................................

March 2014: Market Research - 62nd Annual U.S. Appliance Industry Forecast
February 2014: Appliance Magazine Market Insight: December 2013
January 2014: Market Research - Appliance Historical Statistical Review: 1954-2012
January 2014: Appliance Magazine Market Insight: November 2013




 
Contact Us | About Us | Subscriptions | Advertising | Home
UBM Canon © 2014  

Please visit these other UBM Canon sites

UBM Canon Corporate | Design News | Test & Measurement World | Packaging Digest | EDN | Qmed | Pharmalive | Plastics Today | Powder Bulk Solids | Canon Trade Shows