Whirlpool Q2 N.A. Revenue Rises 5.2%, Profit Off
By Jeff Malester -- TWICE, 7/25/2005
Benton Harbor, Mich. — The good news for major appliances maker Whirlpool was record second-quarter North American revenue of $2.21 billion, a 5.2 percent increase over the $2.10 billion reported in the same three months last year.
The company said its U.S. majap shipments were essentially equal to last year, as strong Whirlpool branded performance was offset by lower Kenmore shipments to Sears. In a conference call, Whirlpool chairman Jeff Fettig attributed the downturn to slower Kenmore sell-thru and inventory reductions as Sears consolidates its Kenmore SKUs.
Total U.S. industry majap shipments rose 2 percent, while sales were positively impacted by price increases and a favorable product mix.
The bad news for Whirlpool was a profit drain traced to high steel and oil costs during the three months, ended June. 30. North American operating profit dropped 12.4 percent to $187 million, down from the $214 million recorded a year ago. The company also registered lower production volumes to reduce inventory levels.
Consolidated second-quarter revenue climbed 9 percent, hitting $3.56 billion, up from $3.26 billion year-on-year. Excluding currency translations, net sales increased by about 5 percent.
Consolidated operating profit slipped 8.5 percent, down to $191 million from last year's $209 million, while net earnings dipped 9.2 percent, coming in at $96 million, compared with $106 million in 2004.
Although overall pricing and mix was in line with expectations and the company fulfilled strong productivity and cost controls, Whirlpool said its quarterly margin was impacted by $180 million in higher materials and oil-related costs. The company has implemented “selected” price increases, effective this month, in response to higher costs.
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