Home appliances giant Whirlpool Corp. (WHR: Quote) Tuesday reported a profit for the second quarter, helped by lower legacy expenses, even as revenue dropped nearly 5 percent and missed Wall Street view, amid a weak Europe and currency headwinds. The company confirmed its full year earnings forecast.
Jeff Fettig, CEO, said, "Our North America and Latin America businesses continue to perform extremely well and we are pleased with our financial performance through the first half of the year. Our ongoing business operating performance is well ahead of last year offsetting lower industry demand, volatile foreign currency and material inflation.''
The company remains positive regarding its underlying business performance and is optimistic on recent U.S. housing trends exiting the second quarter, Fettig added.
Net earnings available to the company stood at $113 million or $1.43 per share, compared to a net loss of $161 million or $2.10 per share in the prior year period. The company incurred lower legacy expenses and lower tax credits in the just concluded quarter.
On an adjusted basis, earnings per share almost doubled to $1.55 from $0.81, driven by continued improvement in product price/mix and cost and capacity-reduction initiatives.
On average, 5 analysts polled by Thomson Reuters expected earnings of $1.64 per share for the quarter. Analysts' estimates typically exclude special items.
Sales in the quarter dropped to $4.51 billion from $4.73 billion in 2011, trailing Wall Street view of $4.63 billion. Sales grew 2 percent in constant currencies. Excluding the impact of both foreign currency and lower Brazilian tax credits, net sales grew over 3 percent.
In Whirlpool North America, second-quarter sales grew 4 percent to $2.5 billion while unit shipments decreased around 2 percent.
Whirlpool Latin America's revenues declined to $1.2 billion from $1.3 billion. Excluding currency translation and Brazilian tax credits, sales increased over 8 percent on slightly higher volumes.
Whirlpool Europe, Middle East and Africa reported second-quarter sales of $692 million, down around 18 percent from the prior year. Excluding currency translation, sales decreased about 7 percent. Unit shipments for the region decreased 7 percent.
The economic situation and unemployment in Europe, especially in the peripheral countries of the continent, has given consumers little dispensable income, forcing them to cut costs.
Yet, Whirlpool continues to expect full-year earnings per share of $5.00 to $5.50. Excluding items such as restructuring expense and Brazilian tax credits, ongoing business operations earnings per share is estimated to be $6.50 to $7.00. Analysts expect earnings of $6.50 per share for the quarter.
WHR closed on Monday at $67.31, down 0.4 percent from the previous close.
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by RTT Staff Writer
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