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<PAGE>
CONFORMED COPY
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 15, 1999
WHIRLPOOL CORPORATION
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-3932 38-1490038
- ---------------------------- -------------------- --------------------
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification No.)
2000 M63 North, Benton Harbor, Michigan 49022-2692
------------------------------------------- --------------------
(Address of principal executive officers) (Zip Code)
(616)-923-5000
-----------------------------------------------------------
Registrant's telephone number, including area code
<PAGE>
Item 5. Other Events
------------
On April 15, 1999 the Company announced its first quarter 1999
earnings. For the quarter, operating profits were $189 million, up 12 percent
from the first quarter of 1998. Reported first quarter 1999 net earnings were
$28 million or 36 cents per diluted share and were reduced by $60 million due to
charges related to the Brazilian currency devaluation. First quarter 1998 net
earnings were $80 million or $1.05 per diluted share. Absent charges for the
Brazilian currency devaluation, first quarter earnings from continuing
operations were $88 million or $1.15 per diluted share, up 29 percent from
earnings from continuing operations of $68 million, of 90 cents per diluted
share in the first quarter of 1998.
Item 7. Financial Statements and Exhibits
---------------------------------
Copy of press release dated April 15, 1999 regarding the Company's
earnings for the first quarter of 1999.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WHIRLPOOL CORPORATION
Registrant
Date: April 19, 1999 By: /s/ Robert T. Kenagy
--------------------------------
Name: Robert T. Kenagy
Title: Associate General Counsel and Secretary
<PAGE>
Media
Christopher Wyse
616-923-3417
[email protected]
Financial
Tom Filstrup
616-923-3189
[email protected]
WHIRLPOOL CORPORATION POSTS RECORD FIRST QUARTER
OPERATING PROFIT DESPITE BRAZILIAN CURRENCY DEVALUATION
EARNINGS FROM CONTINUING OPERATIONS ROSE 29 PERCENT, EXCLUDING EFFECTS
OF BRAZILIAN CURRENCY DEVALUATION
BENTON HARBOR, Mich. - April 15, 1999 - Whirlpool Corporation (NYSE:
WHR) today reported that it extended a trend of strong operating performance
through the first quarter of 1999, leveraging a five-percent gain in unit
shipments into a 12-percent gain in operating profit.
Company operations in North America posted record first-quarter
operating profit performance, while Whirlpool Europe reported record first-
quarter revenues and operating profits, in local currency. Whirlpool Asia also
continued its operating improvements, reporting a second consecutive quarter of
profitability. As expected, operating profit from Latin America, while positive,
was negatively affected by weak economic and business conditions in much of the
region.
"We're consistently delivering solid quarterly results even as we deal
with the challenging economic conditions in Brazil affecting our business in
that region," said David R. Whitwam, Whirlpool chairman and CEO. "In terms of
operating profit results, we are well on our way to what we expect will be
another strong year for Whirlpool."
For the quarter, operating profits were $189 million, up 12 percent
from the first quarter of 1998. Reported first quarter 1999 net earnings were
$28 million or 36 cents per diluted share and were reduced by $60 million due to
charges related to the Brazilian currency devaluation. First quarter 1998 net
- more -
<PAGE>
Whirlpool Corporation earnings - add one
- ----------------------------------------
earnings were $80 million or $1.05 per diluted share. Absent charges for the
Brazilian currency devaluation, first quarter earnings from continuing
operations were $88 million or $1.15 per diluted share, up 29 percent from
earnings from continuing operations of $68 million, or 90 cents per diluted
share in the first quarter of 1998.
"As we announced in March, we've taken steps to limit our exposure to
currency moves in Brazil, and we now expect future net earnings will be largely
reflective of the company's fundamentally strong operating performance," added
Whitwam.
Despite a revenue reduction of about $200 million related to the
devaluation of the Brazilian currency, first quarter sales grew about one
percent to $2.5 billion including double-digit gains in Europe and Asia, as well
as solid growth in North America.
In North America, Whirlpool's shipments grew nine percent, resulting
in market share gains since the end of 1998. Shipments of appliances grew across
trade channels due, in part, to strong consumer acceptance of new products, such
as the latest Whirlpool brand dishwasher and the recently introduced, fiftieth
anniversary, special edition KitchenAid brand dishwasher.
Operations in North America also continued to benefit from Operational
Excellence, the company's customized methodology for improving quality and cycle
times, which helped lower costs and drive higher productivity in the quarter.
The company now expects North American appliance industry unit
shipments to grow between two and three percent for the full year.
Whirlpool Europe turned a double-digit gain in revenues into a 66-
percent gain in quarterly operating profit. The results were driven by continued
strong demand for new and improved Whirlpool and Bauknecht brand products.
The company's performance in Europe has also benefited from a strong
focus on cost reductions and productivity improvements.
- more -
<PAGE>
Whirlpool Corporation earnings - add two
- ----------------------------------------
Despite softening economic conditions in both Western and Eastern
Europe, the company currently expects that appliance industry unit shipments
will grow between one and two percent for the full year.
Whirlpool Asia continued its expected performance improvements with
significant gains in revenues, resulting in a second consecutive quarter of
profitability. A combination of on-going cost reductions and a better mix of
products also drove margins higher in the quarter.
A robust appliance industry and consumer preference for Whirlpool
brand products, including new refrigerators and washing machines, drove
quarterly revenues for Whirlpool of India up 75 percent in a market that saw
appliance sales grow an estimated 15 percent, significantly improving the
company's market and financial position.
Whirlpool China's washing machine joint venture showed revenue growth
revenues for Whirlpool of India up to 75 percent in a market that saw appliance
sales grow an estimated 15 percent, significantly improving the company's market
and financial position.
Whirlpool China's washing machine joint venture showed revenue growth
of about 25 percent in the quarter. The Shanghai, China, based joint venture
also signed an agreement with Kelon, the leading Chinese producer of
refrigerators and room air conditioners, to produce laundry equipment. Export
sales of microwave ovens, produced at the company's Shunde, China, joint
venture, also continue to be strong.
As expected, Whirlpool in Latin America reported lower sales and unit
shipments of appliances resulting mainly from weak economic conditions in
Brazil. The company continued to pursue aggressive actions designed to further
improve performance, including lowering costs and boosting productivity through
various quality initiatives. In addition the company continues to attract
consumer attention with exciting new advertising promoting new and totally
redesigned products under both the Brastemp and Consul brand names.
Embraco, the company's compressor subsidiary, benefited from the
Brazilian currency devaluation, reporting markedly higher operating margins in
the quarter. The company currently expects that Embraco, one of the world's
leading hermetic compressor manufacturers with operations in Brazil, Italy,
Slovakia and China, will continue its strong performance throughout the year.
- more -
<PAGE>
Whirlpool Corporation earnings - add three
- ------------------------------------------
Despite the difficult business conditions, the company remained
solidly profitable on an operating basis in Brazil. The company now expects that
appliance industry shipments in Brazil will decline between 10 and 15 percent
for the full year from 1998 levels, but is encouraged by recent positive
macroeconomic trends that seem to be developing across Brazil.
In summary, Whitwam added, "Based on the fundamental strength of our
operations in North America and Europe, and our continued improvement in Asia,
we expect to overcome the current challenges in Brazil and deliver a year of
solid operating performance improvement."
Whirlpool Corporation is the world's leading manufacturer and marketer
of major home appliances. Headquartered in Benton Harbor, the company
manufactures in 13 countries and markets products under 11 major brand names in
more than 170 countries. Additional information about the company can be found
on the Internet at www.WhirlpoolCorp.com.
###
<PAGE>
CONSOLIDATED CONDENSED BALANCE SHEETS
WHIRLPOOL CORPORATION
(millions of dollars)
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
---------------- -----------------
<S> <C> <C>
ASSETS
Current Assets
- --------------
Cash and equivalents $ 410 $ 636
Trade receivables, less allowances of
(1999: $118; 1998: $116) 1,614 1,711
Inventories 1,171 1,100
Prepaid expenses and other 213 268
Deferred income taxes 158 167
---------------- -----------------
TOTAL CURRENT ASSETS 3,566 3,882
Other Assets
- ------------
Investment in affiliated companies 109 108
Intangibles, net 884 936
Deferred income taxes 243 262
Other 287 329
---------------- -----------------
1,523 1,635
Property, Plant and Equipment
- -----------------------------
Land 72 77
Buildings 845 900
Machinery and equipment 4,188 4,534
Accumulated depreciation (2,958) (3,093)
---------------- -----------------
2,147 2,418
---------------- -----------------
TOTAL ASSETS $ 7,236 $ 7,935
================ =================
<CAPTION>
March 31 December 31
1999 1998
---------------- -----------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
- -------------------
Notes payable $ 993 $ 905
Accounts payable 964 1,079
Employee compensation 223 271
Accrued expenses 794 870
Restructuring costs 87 117
Current maturities of long-term debt 17 25
----------------- -----------------
TOTAL CURRENT LIABILITIES 3,078 3,267
Other Liabilities
- -----------------
Deferred income taxes 146 152
Postemployment benefits 599 622
Other liabilities 183 192
Long-term debt 1,031 1,087
----------------- -----------------
1,959 2,053
Minority Interests 437 614
Stockholders' Equity
- --------------------
Common stock 83 83
Paid-in capital 328 321
Retained earnings 2,025 2,024
Unearned restricted stock (6) (3)
Accumulated other comprehensive income (386) (183)
Treasury stock - at cost (282) (241)
------------------- -----------------
TOTAL STOCKHOLDERS' EQUITY 1,762 2,001
---------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,236 $ 7,935
================ =================
</TABLE>
<PAGE>
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
WHIRLPOOL CORPORATION
FOR THE PERIOD ENDED MARCH 31
(millions of dollars except share and
dividend data)
<TABLE>
<CAPTION>
First Quarter
----------------------------
1999 1998
----------- -----------
<S> <C> <C>
Net sales $ 2,486 $ 2,464
EXPENSES:
Cost of products sold 1,867 1,870
Selling and administrative 421 416
Intangible amortization 9 9
----------- -----------
2,297 2,295
----------- -----------
OPERATING PROFIT 189 169
OTHER INCOME (EXPENSE):
Interest and sundry income (expense) (152) 40
Interest expense (41) (63)
----------- -----------
EARNINGS (LOSS) BEFORE INCOME TAXES
AND OTHER ITEMS (4) 146
Income taxes 8 56
----------- -----------
EARNINGS (LOSS) FROM CONTINUING OPERATIONS
BEFORE EQUITY EARNINGS AND MINORITY INTERESTS (12) 90
Equity in earnings of affiliated companies (2) -
Minority interests 42 (22)
----------- -----------
EARNINGS FROM CONTINUING OPERATIONS 28 68
Earnings from discontinued operations less applicable taxes - 12
----------- -----------
NET EARNINGS $ 28 $ 80
=========== ===========
Per share of common stock:
Basic earnings from continuing operations $ .37 $ .91
Basic net earnings $ .37 $ 1.06
Diluted earnings from continuing operations $ .36 $ .90
Diluted net earnings $ .36 $ 1.05
Cash dividends $ .34 $ .34
=========== ===========
</TABLE>
<PAGE>
SUPPLEMENTAL PRO-FORMA SCHEDULE
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
WHIRLPOOL CORPORATION
FOR THE PERIOD ENDED MARCH 31
(millions of dollars except share and dividend data)
<TABLE>
<CAPTION>
First Quarter
--------------------------------------------------------------
Foreign Exchange Without
Loss due to Foreign
1999 Devaluation in Brazil Exchange 1999
------------ --------------------- ---------- ------------
<S> <C> <C> <C> <C>
Net sales $ 2,486 $ - $ 2,486 $ 2,464
EXPENSES:
Cost of products sold 1,867 - 1,867 1,870
Selling and administrative 421 - 421 416
Intangible amortization 9 - 9 9
------------- --------------------- ---------- ------------
2,297 - 2,297 2,295
------------- --------------------- ---------- ------------
OPERATING PROFIT 189 - 189 169
OTHER INCOME (EXPENSE):
Interest and sundry income (expense) (152) (158) 6 40
Interest expense (41) - (41) (63)
------------- --------------------- ---------- ------------
EARNINGS (LOSS) BEFORE INCOME TAXES
AND OTHER ITEMS (4) (158) 154 146
Income taxes 8 (53) 61 56
------------- --------------------- ---------- ------------
EARNINGS (LOSS) FROM CONTINUING OPERATIONS
BEFORE EQUITY EARNINGS AND MINORITY INTERESTS (12) (105) 93 90
Equity in earnings of affiliated companies (2) - (2) -
Minority interests 42 45 (3) (22)
------------- --------------------- ---------- ------------
EARNINGS (LOSS) FROM CONTINUING OPERATIONS 28 (60) 88 68
Earnings from discontinued operations less applicable taxes - - - 12
------------- --------------------- ---------- ------------
NET EARNINGS (LOSS) $ 28 $ (60) $ 88 $ 80
============= ===================== ========== ============
Per share of common stock:
Diluted earnings from continuing operations $ .36 $ (.79) $ 1.15 $ .90
Diluted net earnings $ .36 $ (.79) $ 1.15 $ 1.05
</TABLE>
Note: This pro-forma has been prepared to show Whirlpool's first
quarter performance excluding the foreign exchange loss related
to the devaluation of the Brazilian real.
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