earnings deck
TRANSCRIPT
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2013 FOURTH-QUARTEREARNINGS REVIEWJanuary 30, 2014
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Fourth-Quarter Earnings Review
WHIRLPOOL CORPORATION ADDITIONAL INFORMATIONThis document contains forward-looking statements about Whirlpool Corporation and its consolidated
subsidiaries (Whirlpool) that speak only as of this date. Whirlpool disclaims any obligation to update thesestatements. Forward-looking statements in this document may include, but are not limited to, statements regardingexpected earnings per share, cash flow, productivity and material and oil-related prices. Many risks, contingencies
and uncertainties could cause actual results to differ materially from Whirlpool's forward-looking statements.Among these factors are: (1) intense competition in the home appliance industry reflecting the impact of both newand established global competitors, including Asian and European manufacturers; (2) Whirlpool's ability to continueits relationship with significant trade customers and the ability of these trade customers to maintain or increasemarket share; (3) changes in economic conditions which affect demand for our products, including the strength ofthe building industry and the level of interest rates; (4) inventory and other asset risk; (5) risks related to ourinternational operations, including changes in foreign regulations, regulatory compliance and disruptions arisingfrom natural disasters or terrorist attacks; (6) the uncertain global economy; (7) the ability of Whirlpool to achieve
its business plans, productivity improvements, cost control, price increases, leveraging of its global operatingplatform, and acceleration of the rate of innovation; (8) Whirlpool's ability to maintain its reputation and brandimage; (9) fluctuations in the cost of key materials (including steel, oil, plastic, resins, copper and aluminum) andcomponents and the ability of Whirlpool to offset cost increases; (10) litigation, tax, and legal compliance risk andcosts, especially costs which may be materially different from the amount we expect to incur or have accrued for;(11) product liability and product recall costs; (12) the effects and costs of governmental investigations or relatedactions by third parties; (13) Whirlpool's ability to obtain and protect intellectual property rights; (14) the ability ofsuppliers of critical parts, components and manufacturing equipment to deliver sufficient quantities to Whirlpool ina timely and cost-effective manner; (15) health care cost trends, regulatory changes and variations between results
and estimates that could increase future funding obligations for pension and post retirement benefitplans; (16) information technology system failures and data security breaches; (17) the impact of labor relations;(18) our ability to attract, develop and retain executives and other qualified employees; (19) changes in the legal andregulatory environment including environmental and health and safety regulations; and (20) the ability of Whirlpoolto manage foreign currency fluctuations.
Additional information concerning these and other factors can be found in Whirlpool's filings with theSecurities and Exchange Commission, including the most recent annual report on Form 10-K, quarterly reports onForm 10-Q, and current reports on Form 8-K.
01/30/2014 2Whirlpool Corporation
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OVERVIEW
01/30/2014
Whirlpool brand White Ice Collection
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2013 FULL-YEAR RESULTS OVERVIEW
01/30/2014
Net Sales
Net Sales
(Ex Currency
and BEFIEX)
Diluted EPS(GAAP)
Ongoing
BusinessOperations
EPS(1)
Free CashFlow(2)
2013 $18.8B $18.9B $10.24 $10.02 $0.7B
2012 $18.1B $18.1B $5.06 $7.05 $0.2B
Change $0.7B $0.8B $5.18 $2.97 $0.5B
% Change 3.4% 4.4% 102.3% 42.1% 200.0%
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2014 BUSINESS PRIORITIES
01/30/2014Whirlpool Corporation
7
Revenue growth and margin expansion
Innovative new product launches
Grow beyond the core
Ongoing cost productivity programs
Additional cost and capacity reduction initiatives
Complete acquisition of Hefei Sanyo
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Fourth-Quarter Earnings Review
Region Outlook
North America +5% to +7%
Europe, Middle
East & Africa Flat to +2%
Latin America Flat
Asia Flat to +3%
FULL-YEAR 2014 INDUSTRY DEMAND ASSUMPTIONS
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2014 FINANCIAL OUTLOOK
01/30/2014Whirlpool Corporation
10
GAAP Diluted EPS $11.05$11.55
Ongoing Business Operations EPS(1) $12.00$12.50
Free Cash Flow(2) $700 million
CONTINUED REVENUE GROWTH, MARGIN EXPANSION
AND CASH GENERATION
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NORTH AMERICAOPERATIONS
01/30/2014
Jenn-AirLakefront Kitchen in Euro-Style stainless and Custom Panel Overlay design
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NORTH AMERICA FOURTH-QUARTER RESULTS
SALES GROWTH AND MARGIN EXPANSION
01/30/2014
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %Net Sales $ 2,725 $ 2,503 $ 222 9%
Operating Profit (GAAP) $ 301 $ 233 $ 68 29%
Operating Margin % (GAAP) 11.0% 9.3% 1.7 pts
Ongoing Business Operating Profit(1) $ 301 $ 233 $ 68 29%
Ongoing Business Operating Margin %(1) 11.0% 9.3% 1.7 pts
+Sales growth
(strong U.S. growth of approximately 11%)+ Ongoing cost productivity
+ Cost and capacity-reductions
12Whirlpool Corporation
Raw Materials
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2014 NORTH AMERICA
13FOURTH-QUARTER EARNINGS REVIEW
1/30/2014
Continued strong industry growth from housing, replacement and
discretionary demand
Innovative new product launches
Grow beyond the core
Ongoing cost productivity programs
Investments in marketing, technology and products
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Fourth-Quarter Earnings Review 01/30/2014 14Whirlpool Corporation
NORTH AMERICA PRODUCT LEADERSHIP
Jenn-Airbuilt-in coffee system
EveryDropwater filter
Whirlpoolbrandfour-door refrigerator
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EUROPE, MIDDLEEAST AND AFRICA(EMEA) OPERATIONS
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Whirlpool brand Fusion kitchen suite in Europe
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EUROPE, MIDDLE EAST AND AFRICA (EMEA) FOURTH-QUARTER RESULTS
PROFITABLE RESULTS IN A WEAK BUT RECOVERING ENVIRONMENT
01/30/2014
+Cost and capacity-reductions Raw Materials
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %Net Sales $ 847 $ 794 $ 53 7%
Operating Profit (GAAP) $ 10 $ 8 $ 2 31%
Operating Margin % (GAAP) 1.2% 1.0% 0.2 pts
Ongoing Business Operating Profit(1) $ 10 $ 8 $ 2 31%
Ongoing Business Operating Margin %(1) 1.2% 1.0% 0.2 pts
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Fourth-Quarter Earnings Review 01/30/2014 18Whirlpool Corporation
EUROPE PRODUCT LEADERSHIP
Bauknechtbrands KOSMOSbuilt-in induction oven,and the Bauknecht GreenKitchen refrigerator and dishwasher
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LATIN AMERICAOPERATIONS
01/30/2014 19Whirlpool Corporation
Consul brand kitchen in Brazil
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LATIN AMERICA FOURTH-QUARTER RESULTS
SALES GROWTH AND MARGIN EXPANSION
01/30/2014
+Sales growth of 8%(ex BEFIEX and foreign currency)
+ Favorable price/mix+Ongoing cost productivity
Raw materials
Foreign currency
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %Net Sales $ 1,381 $ 1,331 $ 50 4%
Operating Profit (GAAP) $ 159 $ 134 $ 25 19%
Operating Margin % (GAAP) 11.5% 10.1% 1.4 pts
Ongoing Business Operating Profit(1) $ 130 $ 119 $ 11 10%
Ongoing Business Operating Margin %(1) 9.7% 9.0% 0.7 pts
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LATIN AMERICA
01/30/2014 22Whirlpool Corporation
CHALLENGESUNCERTAINTIESPOSITIVE DRIVERS
Population growth
Emerging middle class
Appliance penetration
Strengthening
domestic market
Real wage growth
Low unemployment
Foreign currency
Inflation
MANAGING SHORT-TERM VOLATILITY,
LONG TERM FUNDAMENTALS STRONG
2014 World Cup
2014 government
elections
Consumer andbusiness sentiment
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LATIN AMERICA PRODUCT LEADERSHIP
01/30/2014 23Whirlpool Corporation
Whirlpool Connect
refrigerators smart
technology
Brastemp Ative!
washer-dryerConsul Facilite
portable air conditioner
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ASIAOPERATIONS
01/30/2014 24Whirlpool Corporation
Whirlpool brandMini ACE Wash Station
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ASIA FOURTH-QUARTER RESULTS
MARGIN EXPANSION DESPITE INDUSTRY WEAKNESS IN INDIA
01/30/2014
+ Favorable price/mix
+Ongoing cost productivity
Industry demand
Raw materials
Foreign currency
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %Net Sales $ 177 $ 203 $ (26) (13)%
Operating Profit (GAAP) $ 10 $ 7 $ 3 44%
Operating Margin % (GAAP) 5.4% 3.3% 2.1 pts
Ongoing Business Operating Profit(1) $ 10 $ 7 $ 3 44%
Ongoing Business Operating Margin %(1) 5.4% 3.3% 2.1 pts
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2014 ASIA
Managing through volatility in India
Industry growth in China
Innovative new product launches
Acquisition of majority stake in Hefei Rongshida Sanyo
expected to close between the end of the second quarter
and the end of 2014.
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ASIA PRODUCT LEADERSHIP
01/30/2014 27Whirlpool Corporation
Whirlpool brands
Professional
frost-free refrigerator
Whirlpool Armstrong
total laundry homesolution
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FINANCIALREVIEW
01/30/2014 28Whirlpool Corporation
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Full Year
2012 Actual 5.7%
Price / Mix ~
Cost and Capacity Reductions ~1
Ongoing Cost Productivity and Material
Costs~
Marketing, Technology and Product
Investments~()
2013 Actual 7.3%
29Whirlpool Corporation
ONGOING BUSINESS OPERATIONSMARGIN EXPANSION DRIVERS
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FOURTH-QUARTER FINANCIAL SUMMARY
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %Net Sales $ 5,090 $ 4,791 $ 299 6%
Gross Margin % 17.9% 16.9% 1.0 pts
SG&A % 9.7% 10.1% 0.4 pts
Restructuring $ 56 $ 62 $ 6 10%Operating Profit (GAAP) $ 354 $ 258 $ 96 37%
Ongoing Business Operating Profit(1) $ 386 $ 309 $ 77 25%
Operating Profit % (GAAP) 7.0% 5.4% 1.6 pts
Ongoing Business Operating Profit %(1)
7.7% 6.5% 1.2 pts
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FOURTH-QUARTER FINANCIAL SUMMARY
01/30/2014
Fourth Quarter Better/(Worse)
(USD in millions) 2013 2012 2012 %
Operating Profit (GAAP) $ 354 $ 258 $ 96 37%
Ongoing Business Operating Profit(1) $ 386 $ 309 $ 77 25%
Interest & Sundry Income (Expense) (82) (35) (47) (135)%
Interest Expense (44) (49) 5 10%
Earnings Before Income Taxes (GAAP) $ 228 $ 174 $ 54 31%
Ongoing Business Operations
Earnings Before Income Tax(1)$ 322 $ 242 $ 80 34%
Income Tax Expense 41 46 5 13%
Net Earnings Available to Whirlpool 181 122 59 48%
EPSDiluted (GAAP) $ 2.26 $ 1.52 $ 0.74 49%
Ongoing Business Operations EPS(1) $ 2.97 $ 2.29 $ 0.68 30%
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$-
$50
$100
$150
$200
$250
Q4 2011 2012 2013 2014
Projected Charges
Actual Charges
COST AND CAPACITY-REDUCTION CHARGES
01/30/2014
Charges
(inmillions)
ADDITIONAL $100M OF CHARGES AND $80M IN EXPECTED ONGOING
BENEFITS IN 2014
$78
$237
$196
~$100
32Whirlpool Corporation
2011 Plan: ~$500M of charges delivered
$400M in committed benefits through 2013
$80M in
Expected
Ongoing
Benefits
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2014 ONGOING BUSINESS EPS GUIDANCE
01/30/2014
Earnings Per Share
GAAP Diluted EPS $11.05$11.55
Restructuring Expense 0.95
Brazilian (BEFIEX) Tax Credits (0.21)
Investment Expense 0.21Ongoing Business Operations EPS(1) $12.00$12.50
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Full-Year
2013 Actual 7.3%
Price / Mix ~- 1
Cost and Capacity
Reductions
~
Ongoing Cost Productivity
and Material Costs~
Marketing, Technology
and Product Investments~() -(1)
2014 Outlook 8%+
35Whirlpool Corporation
ONGOING BUSINESS OPERATIONSMARGIN EXPANSION DRIVERS
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Year-Over-Year
Impact
2013 Actual $690M
Cash Earnings
Capital Expenditures
Restructuring Cash
Working Capital
Pension Contributions
Brazilian Tax Credits (BEFIEX)
2014 Outlook $700M
36Whirlpool Corporation
FULL YEAR FREE CASH FLOW DRIVERS
Investments
for Growth& Profitability
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COMMITTED TO EXECUTING OUR LONG-TERM GROWTH STRATEGY
CASH FLOW PRIORITIES
Fund the Business
Debt Maturities and Pension Contributions
Return to Shareholders
M&A
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CLOSINGREMARKS
01/30/2014 38Whirlpool Corporation
In Europe, the Whirlpool brandiXelium Supreme Design cooktop
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2013 CLOSING REMARKS Well-positioned for positive global demand
Continued growth and margin expansion
Robust pipeline of new, innovative products
Generating cash and investment capacity
01/30/2014 39Whirlpool Corporation
REMAIN FOCUSED ON DELIVERING
OUR SHAREHOLDER VALUE CREATION TARGETS
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ROADMAP FOR GROWTH AND VALUE CREATION
GROWTH
Geographic expansion
Product line extension
Adjacent revenue streams
MARGIN EXPANSION
Leading brands and innovation
Extend cost leadership
Extend quality leadership
9
CASH GENERATION
Disciplined capital investment
Increased asset turnover
SHAREHOLDER VALUE
CREATION TARGETS
+57% REVENUE GROWTH
8%+ OPERATING MARGIN
+1015% EPS GROWTH
45% FCF% OF SALES
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RECONCILIATION OF GAAP TO NON-GAAP FINANCIALMEASURES:
01/30/2014
We supplement the reporting of our financial information determined under U.S. generally accepted accounting
principles (GAAP) with certain non-GAAP financial measures, some of which we refer to as "ongoing business
operations" measures, including adjusted operating profit, adjusted earnings (loss) before income taxes (hereafter
referred to as adjusted earnings (loss) before tax), adjusted diluted earnings per share, adjusted operating profit by
segment (hereafter referred to as adjusted segment operating profit), adjusted segment operating margin; and sales
excluding foreign currency and BEFIEX and free cash flow. Ongoing business operations measures exclude items that may
not be indicative of, or are unrelated to, results from our ongoing business operations and provide a better baseline for
analyzing trends in our underlying businesses. Sales excluding foreign currency and BEFIEX is calculated by translating
the current period net sales excluding BEFIEX, in functional currency, to U.S. dollars using the prior-year periods
exchange rate compared to the prior-year period net sales excluding BEFIEX. Management believes that sales excludingforeign currency and BEFIEX provides stockholders with a clearer basis to assess our results over time. Management
believes that free cash flow provides investors and stockholders with a relevant measure of liquidity and a useful basis
for assessing the company's ability to fund its activities and obligations. We believe that these non-GAAP measures
provide meaningful information to assist investors and stockholders in understanding our financial results and assessing
our prospects for future performance. Because non-GAAP financial measures are not standardized, it may not be
possible to compare these financial measures with other companies non-GAAP financial measures having the same or
similar names. These adjusted financial measures should not be considered in isolation or as a substitute for reported
operating profit, earnings before income taxes, diluted net earnings per share available to Whirlpool, reported operating
profit by segment, net sales, and cash provided by operating activities, the most directly comparable GAAP financial
measures. These non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when
viewed with our GAAP results and the following reconciliations to corresponding GAAP financial measures, provide a
more complete understanding of our business. We strongly encourage investors and stockholders to review our financial
statements and publicly-filed reports in their entirety and not to rely on any single financial measure.
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ONGOING BUSINESS OPERATIONS MEASURESADJUSTEDOPERATING PROFIT, ADJUSTED EARNINGS BEFORE TAXAND ADJUSTED DILUTED EARNINGS PER SHARE:
01/30/2014
The reconciliation provided below reconciles the non-GAAP financial measures adjusted operating profit, adjustedearnings before tax and adjusted diluted earnings per share, with the most directly comparable GAAP financial
measures, reported operating profit, earnings before income taxes and diluted net earnings per share available to
Whirlpool, for the three months ended December 31, 2012. Adjusted segment operating margin is calculated by
dividing adjusted segment operating profit by adjusted net sales. Adjusted net sales excludes Brazilian (BEFIEX)
tax credits from reported net sales.
44Whirlpool Corporation
Reported GAAP Measure $ 258 $ 174 $ 1.52
Restructuring Expense(a)
Brazilian Tax Credits (BEFIEX)(b) (15) (15) (0.19)
Antitrust Resolutions(d) 17 0.21
Intangible Impairment(h) 4 4 0.03
Normalized Tax Rate Adjustment (g)
Adjusted Non-GAAP measure $ 309 $ 242 $ 2.29
Three Months Ended
December 31, 2012
Operating
Profit
Earnings Before
Tax
Diluted Earnings
Per Share
0.16
62 62 0.56
ONGOING BUSINESS OPERATIONS MEASURESADJUSTED OPERATING PROFIT
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The reconciliation provided below reconciles the non-GAAP financial measures adjusted operating profit, adjusted
earnings before tax and adjusted diluted earnings per share, with the most directly comparable GAAP financial
measures, reported operating profit, earnings before income taxes and diluted net earnings per share available toWhirlpool, for the twelve months ended December 31, 2013. Adjusted segment operating margin is calculated by
dividing adjusted segment operating profit by adjusted net sales. Adjusted net sales excludes Brazilian (BEFIEX) tax
credits from reported net sales.
1/30/2014FOURTH-QUARTER EARNINGS REVIEW
ONGOING BUSINESS OPERATIONS MEASURES ADJUSTED OPERATING PROFIT,ADJUSTED EARNINGS BEFORE TAX AND ADJUSTED DILUTED EARNINGS PERSHARE:
45
Reported GAAP Measure $ 1,249 $ 917 $ 10.24
Restructuring Expense(a)
Brazilian Tax Credits (BEFIEX)(b) (109) (109) (1.35)
U.S. Energy Tax Credits (c) (1.56)
Antitrust Resolutions(d) 42 0.40
Investment Expense(e) 6 21 0.19
Brazilian Government Settlement (f )
Adjusted Non-GAAP measure $ 1,353 $ 1,095 $ 10.02
Twelve Months Ended
December 31, 2013
OperatingProfit Earnings BeforeTax Diluted EarningsPer Share
196 196 1.84
11 28 0.26
ONGOING BUSINESS OPERATIONS MEASURESADJUSTED OPERATING PROFIT
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The reconciliation provided below reconciles the non-GAAP financial measures adjusted operating profit, adjusted
earnings before tax and adjusted diluted earnings per share, with the most directly comparable GAAP financial
measures, reported operating profit, earnings before income taxes and diluted net earnings per share available to
Whirlpool, for the twelve months ended December 31, 2012. Adjusted segment operating margin is calculated by
dividing adjusted segment operating profit by adjusted net sales. Adjusted net sales excludes Brazilian (BEFIEX) tax
credits from reported net sales.
1/30/2014FOURTH-QUARTER EARNINGS REVIEW
ONGOING BUSINESS OPERATIONS MEASURES ADJUSTED OPERATING PROFIT,ADJUSTED EARNINGS BEFORE TAX AND ADJUSTED DILUTED EARNINGS PERSHARE:
46
Reported GAAP Measure $ 869 $ 558 $ 5.06
Restructuring Expense(a)
Brazilian Tax Credits (BEFIEX)(b) (37) (37) (0.47)
Antitrust Resolutions(d) 25 0.32
Investment and Intangible Impairment(h) 4 11 0.12
Benefit Plan Curtailment Gain(i) (49) (49) (0.38)
Contract and Patent Resolutions (j) 22 0.17
Normalized Tax Rate Adjustment (g)
Adjusted Non-GAAP measure $ 1,024 $ 767 $ 7.05
Twelve Months Ended
December 31, 2012
Operating
Profit
Earnings Before
Tax
Diluted Earnings
Per Share
237 237 2.15
0.08
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ONGOING BUSINESS OPERATIONS MEASURESADJUSTEDSEGMENT OPERATING PROFIT:
01/30/2014
The reconciliation provided below reconciles the non-GAAP financial measure adjusted segment operating profit
with the most directly comparable GAAP financial measure, reported segment operating profit, for the three-months ended December 31, 2013. Adjusted segment operating margin is calculated by dividing adjusted
segment operating profit by adjusted net sales. Adjusted net sales excludes Brazilian (BEFIEX) tax credits from
reported net sales.
47Whirlpool Corporation
North America $ 301 $ $ $ $ $ 301
Latin America 130
EMEA
Asia 10
Other/Eliminations (65)
Total Whirlpool Corporation $ 354 $ 56 $ (40) $ 5 $ 11 $ 386
(126) 56 5
10 10
10
Three Months Ended
December 31, 2013
159 (40) 11
Segment
Operating Profit
Restructuring
Expense(a)
Brazilian Tax
Credits
(BEFIEX)(b)
Adjusted
Segment
Operating Profit
Investment
Expense(e)
Brazilian
Government
Settlement(f )
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ONGOING BUSINESS OPERATIONS MEASURESADJUSTEDSEGMENT OPERATING PROFIT:
01/30/2014
The reconciliation provided below reconciles the non-GAAP financial measure adjusted segment operating profit
with the most directly comparable GAAP financial measure, reported segment operating profit, for the three-months ended December 31, 2012. Adjusted segment operating margin is calculated by dividing adjusted
segment operating profit by adjusted net sales. Adjusted net sales excludes Brazilian (BEFIEX) tax credits from
reported net sales.
48Whirlpool Corporation
North America $ 233 $ $ $ $ 233
Latin America 119
EMEA
Asia
Other/Eliminations (58)
Total Whirlpool Corporation $ 258 $ 62 $ (15) $ 4 $ 309
4
8
77
(124) 62
134 (15)
8
Segment
Operating Profit
Restructuring
Expense(a)
Brazilian Tax
Credits
(BEFIEX)(b)
Intangible
Impairment(h)
Three Months Ended
December 31, 2012
Adjusted
Segment
Operating Profit
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FOOTNOTES:
01/30/2014
a) During the fourth quarters of 2013 and 2012, we recorded restructuring charges of $56 million and $62
million, respectively. The diluted earnings per share impacts are calculated based on income tax impacts of
$13 million and $17 million, respectively. During the full years of 2013 and 2012, we recorded restructuring
charges of $196 million and $237 million, respectively. The diluted earnings per share impacts are calculatedbased on income tax impacts of $47 million and $66 million, respectively.
b) During the fourth quarters of 2013 and 2012, we monetized Brazilian (BEFIEX) tax credits of $40 million and
$15 million, respectively. During the full years of 2013 and 2012, we monetized Brazilian (BEFIEX) tax credits
of $109 million and $37 million, respectively. The diluted earnings per share impact is calculated based on
income tax impacts of $0 million.
c) In the fourth quarter of 2013, we recognized $11 million of U.S. energy tax credits. The diluted earnings per
share impact is calculated based on an income tax benefit of $11 million. During the full year of 2013, werecognized $126 million of U.S. energy tax credits. The diluted earnings per share impact is calculated based
on an income tax benefit of $126 million.
d) During the fourth quarters of 2013 and 2012, we recognized expenses of approximately $44 million and $17
million, respectively, related to antitrust resolutions. The diluted earnings per share impact is calculated
based on an income tax impact of $11 million and $0 million, respectively. During the full year of 2013 and
2012, we recognized expenses of $42 million and $25 million, respectively related to antitrust resolutions.
The diluted earnings per share impact is calculated based on income tax impacts of $10 million and $0million, respectively.
e) During the fourth quarter and full-year of 2013, we recognized investment expenses of $6 million and $21
million, respectively, related to the pending acquisition of Hefei Sanyo. The diluted earnings per share impact
is calculated based on income tax impacts of $1 million and $5 million, respectively.
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FOOTNOTES (CONTINUED):
01/30/2014
f) During the fourth quarter of 2013, we participated in a Brazilian government program to settle long-standing
disputes, reducing interest and penalties. We recorded expenses of $28 million related to the program. The
diluted earnings per share impact is calculated based on an income tax impact of $7 million.
g) During the fourth quarters of 2013 and 2012, and the full year of 2012, we made adjustments to ongoing
business operations EPS to reconcile specific items reported to a full-year effective tax rate of 24%.
h) During the fourth quarter of 2012, a $4 million intangible impairment charge occurred. The diluted earnings
per share impact is based on an income tax impact of $1 million. During the second quarter of 2012, a $7
million other-than-temporary impairment charge of a European investment occurred. The diluted earnings
per share impact is calculated based on an income tax impact of $0 million.
i) During the second quarter of 2012, we recognized curtailment gains related to a retiree health care plan of$49 million. The diluted earnings per share impacts are calculated based on an income tax impact of
approximately $19 million.
j) In the third quarter of 2012, we recorded net expenses of $22 million primarily due to the conclusion of a
long-standing U.S. contract and patent litigation. The diluted earnings per share impact is calculated based
on an income tax impact of approximately $8 million.
50Whirlpool Corporation
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Fourth-Quarter Earnings Review
As defined by the company, free cash flow is cash provided by operating activities after capital
expenditures and proceeds from the sale of assets. The reconciliation provided below reconciles twelve-month
actual 2013 and 2012 and projected 2014 full-year free cash flow with actual and projected cash provided by
operating activities, the most directly comparable GAAP financial measure.
FREE CASH FLOW:
01/30/2014 51Whirlpool Corporation
(millions of dollars)
Cash Provided by Operating Activities $ 1,262 $ 696 $ 1,325 $ 1,375
Capital Expenditures and Proceeds
from Sale of Assets (572) (466) (625) (675)
Free Cash Flow $ 690 $ 230 $ 700
2014 Outlook
Twelve Months Ended
December 31,
2013 2012
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Fourth-Quarter Earnings Review
HEFEI SANYO
Strong and growing presence
in China
2012 Sales USD $636M
Large established distribution
network Scaled manufacturing
presence with opportunity
for growth
Record of growth and
profitability
Strong management team
Whirlpool to acquire 51%equity stake for RMB 3.4
billion (USD $555M based on theexchange rate as of December 31,
2013)
52
Accelerates Whirlpools
emerging market growth
strategy
Platform for domestic and
export growth
Significant manufacturing
and distribution footprint
Expect this transaction will
be accretive in the first full
year of integration
HEFEI SANYO* TIMING OPPORTUNITY
* Hefei RONGSHIDA SANYO Electric Co., Ltd [600983: Shanghai]
Agreement announced
8/13/13
Approved by Hefei Sanyo
shareholders, SASAC,
MOFCOM Subject to CSRC regulatory
approvals and other
formalities
Timing is uncertain, but the
transaction is expected to
close between the end of thesecond quarter and the end
of 2014
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