NEWTON, IOWA -Slower-than-expected sales of major appliances at Maytag Corp. during October and November have initiated a company announcement that fourth-quarter consolidated sales and earnings will be below expectations.
Maytag now expects fourth-quarter earnings per share from operations will be about 50 percent lower than the same three months in 1999. Last year,
Maytag reported 82 cents for the fourth quarter. Maytag's fourth quarter runs through the end of December.
"The expectations set by this organization publicly were based on assumptions that the major appliance industry would be flat or down slightly for the quarter," said president/CEO Leonard A. Hadley. "The industry is down more severely, and as a result, we are seeing lower volume in income and operating inefficiencies associated with lower production levels."
Sales of Hoover floor care products remain strong, he said.
Maytag also expects to take special charges in the fourth quarter, including a number of one-time charges associated with asset write-downs, suspended business initiatives and the previously announced management reorganization. These special charges could total as much as $55 million to $65 million pretax, said the company.
Hadley, who expects weakness in the majap industry to continue into the first quarter of next year, remains optimistic about Maytag's actions to refocus its core business strengths. "My challenge," he said, "is to deliver in 2001 earnings per share performance that matches or betters full-year 2000 earnings per share results, excluding the one-time charges. Assuming benign economic conditions, I believe we can do that." n