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Whirlpool Posts Lower Net, Higher Operating Profits

BENTON HARBOR, MICH. — Whirlpool reported lower third-quarter GAAP net earnings and sales compared with the prior year, but posed higher operating profits.

Net earnings were of $74 million in the third quarter, ended Sept. 30, compared with net earnings of $177 million reported during the same period last year.

Sales in the quarter were $4.5 billion, compared with $4.6 billion in 2011.

“We have delivered three consecutive quarters of yearover- year operating margin improvement this year driven by the actions we outlined last October,” said Jeff M. Fettig, chairman/CEO of Whirlpool Corporation. “Our ongoing business performance should continue to improve due to our strong cadence of new product innovations, the benefit of our cost savings programs and positive trends in U.S. housing.”

Third-quarter GAAP operating profit totaled $214 million, compared with $136 million in the prior year, primarily driven by positive product price and mix, partially offset by reduced monetization of Brazilian (BEFIEX) tax credits and higher material costs. On an adjusted basis, third-quarter operating profit totaled $263 million and was up significantly from the $110 million reported in the prior year. Continued improvement in product price and mix and cost and capacity-reduction initiatives positively impacted results during the quarter.

Whirlpool North America’s third-quarter sales of $2.4 billion increased approximately 2 percent from the prior year. Overall, North America unit shipments decreased approximately 5 percent. The North America region reported operating profit of $227 million, exceeding 9 percent of sales, compared to $62 million, approximately 3 percent of sales, in the previous year.

Product price and mix combined with cost and capacity- reduction actions more than offset higher material costs to expand operating margins, Whirlpool said. This marks the fourth consecutive quarter of year-over-year operating profit margin improvement.

Based on the current economic outlook, the company continues to expect full-year 2012 U.S. industry unit shipments to be flat to down 2 percent.

During the quarter, North American product launches included the new Ice Collection of kitchen appliances under the Whirlpool brand, featuring metallic accents and streamlined controls. The suite includes refrigerators, wall ovens, ranges, microwaves, and dishwashers.

In addition, KitchenAid introduced the Even-Heat line of 30-inch built-in wall ovens, which combine a unique bowtie shaped baffle with a convection fan and element to thoroughly circulate heated air around all three racks to provide even baking. KitchenAid also debuted an Energy Star-qualified French door refrigerator with an advanced design that helps keep foods fresh and flavorful while protecting them from spoilage and freezer burn.