Benton Harbor, Mich. - Cost reductions, productivity initiatives and a 13 percent spike in sales to $4.9 billion pushed Whirlpool's fourth-quarter profits up 111 percent to $95 million.
Whirlpool said the favorable factors were partially offset by a higher mix of lower-priced products, and that net earnings for the three-month period, ended Dec. 31, also included a $46 million accrual stemming from a collection dispute. In addition, sales rose only 5 percent when favorable foreign exchange fluctuations are excluded.
For the full year, net earnings fell 21.5 percent to $328 million and sales declined 9.6 percent to $17.1 billion.
"In 2009 we significantly improved our global cost structure and operating performance despite a substantial decline in global demand levels," chairman/CEO Jeff Fettig said in a statement. "In addition, we generated record free cash flow [of $1.1 billion] and strengthened our financial position. I am pleased with our execution in this challenging environment, and we look to build upon our progress in 2010."
Working capital, particularly due to reduced inventory balances, was a significant source of cash flow during the year, the company said.
In North America, fourth-quarter sales increased 4 percent to $2.6 billion while unit shipments increased 8 percent, exceeding total U.S. industry shipments of 6 percent.
Operating profit was $136 million compared to a loss of $20 million for the year-ago period, also due largely to cost reductions, productivity initiatives and increased sales volume, Whirlpool said. Those factors were also partially offset by a lower product price/mix.
Based on the current economic outlook, the company expects full-year 2010 U.S. industry unit shipments to increase between 2 percent and 4 percent.
"We have positioned the company to deliver strong earnings growth despite a continued challenging economic backdrop in the developed economies," Fettig noted. "Cost reduction, cash-flow generation and balanced market execution remain key operating priorities. These efforts, combined with our global brand portfolio, innovative product offerings and the value of innovation we bring to consumers, will provide us with growth opportunities throughout the year."