Whirlpool (WHR 130.05, -20.66, -13.71%) reported second quarter earnings of $3.20/share, excluding
non-recurring items, which came in well below expectations. On the top line,
revenues fell 3.9% year/year to $5.14 bln, which also came in below
Second-quarter ongoing EBIT was $343 mln, or 6.7% of sales, compared to $350 mln, or 6.5% of sales, in the same prior-year period.
"We are pleased to deliver margin expansion in a very challenging cost environment, driven by strong North America margins and significant global price/mix improvement during the second quarter," said Marc Bitzer, chief executive officer of Whirlpool Corporation. "Despite these positives, our performance in EMEA was below expectations. As a result, we are taking strong actions to improve our operational execution, and remain confident that we will deliver value for our shareholders in the coming quarters."
Moving over to its regional breakdown:
North America- Whirlpool North America reported second-quarter net sales of of $2.8 bln, compared to $2.8 bln in the same prior-year period. Excluding the impact of currency, sales decreased 2.2%.
- The North America region reported strong earnings before interest and taxes (EBIT) margin of 11.9% despite temporary U.S. industry weakness and significant cost inflation.
EMEA- Whirlpool Europe, Middle East and Africa reported second-quarter net sales of $1.1 bln, compared to $1.2 bln in the same prior-year period. Excluding the impact of currency, sales decreased 12.3%.
- Following weak EMEA performance, the company is taking strong actions to restore profitability in the second half of 2018.
Latin America- Whirlpool Latin America reported
second-quarter net sales of $852 mln, compared to $986 mln in the same prior-year
period. Excluding the impact of currency, sales decreased 11.4%.
Asia- Whirlpool Asia reported second-quarter net sales of $428 mln, compared to $373 mln in the same prior-year period. Excluding the impact of currency, sales increased 14.5%.
Looking forward, the company expects to see fiscal year 2019 in the range of $14.20-14.80 as favorable product price/mix and share repurchases are expected to be more than offset by lower global revenue growth, increased expectations for global cost inflation, and weaker than expected performance in the EMEA region.
Ultimately, this guidance falls below current expectations, contributing to the weight on shares this morning.
In current trade, shares of WHR are down 13.7%.