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Maytag Q2 Majap Sales Jump 23%

7/16/2002 09:20:00 AM Eastern

Newton, Iowa - Maytag's Amana acquisition as well as better-than-expected industry boosted the major appliance maker in the second quarter, with the company's home appliance segment posting a 23 percent year over year sales gain.

Maytag's second quarter home appliance sales, which include major appliance and floor care, climbed to $1.1 billion, up from $907.3 million in the same three months in 2001.

Operating income for the segment soared 82 percent in the second quarter, hitting $127.8 million, up from $70.2 million in the second three months of last year.

Maytag reported overall net income of $68.3 million, excluding discontinued businesses and before accounting changes, up from $27.7 million in the second quarter of 2001. Including discontinued operations, the company posted profit of $68 million in the second quarter, ended June 30, compared with income of $21.8 million in the same quarter last year. The year-ago figure included a loss on discontinued operations and the cumulative effect of accounting changes.

'Most of the year-over-year sales growth was due to the Amana acquisition,' said Ralph F. Hake, chairman/CEO.

'Our improvement in second quarter income is attributable to a favorable mix of higher margin Maytag laundry and Jenn-Air products, overall volume-related efficiencies and positive results generated by our cost control initiatives,' he said.

However, looking ahead, Hake expects Maytag to continue to perform well, but predicts year-over-year growth may not be as strong in the second half of the year as it was in the first. 'I think the industry growth rate will taper off in the months ahead. Maytag's business could be less than robust because of that, plus we will experience our normal production shutdowns in the second half.

'So far this year, we've been comparing results to periods in 2001 when we did not own Amana, but year-over-year growth comparisons will change because Amana was acquired August 1 of last year. For the full year 2002, we expect Maytag's sales to be up about 15 percent over 2001,' he said.

Maytag's home appliance segment had first half sales of $2.2 billion, up 22.8 percent from the $1.8 billion reported in the first six months of 2001.

Operating income for the segment jumped 59 percent, reaching $246.8 million, compared with $155.2 million in last year's first six months.

Net income overall, excluding discontinued businesses, reached $126.4 million in the first six months, up from $64.3 million year over year. Including discontinued operations, Maytag posted a profit of $124.8 million in the first half, compared with income of $98.1 million in the same period in 2001.

Consolidated Maytag second quarter sales rose 22.3 percent, to $1.2 billion, up from $975 million in the year-ago period. Consolidated operating income in the second three months jumped 90.2 percent, hitting $121.8 million, up from $64 million in the same quarter last year.

For the six months, consolidated sales climbed 21.3 percent, reaching $2.4 billion, compared with $2 billion year over year. Consolidated operating income rose 62.3 percent in the first half, to $229 million, compared with $141.1 million in the first six months of 2001.