Wall Street didn’t take kindly to Whirlpool Corporation’s 1st Quarter Report, as explained in the company’s quarterly Conference Call with stock analysts Thursday morning. After the comments by Chairman/CEO Marc Bitzer and Chief Financial Officer Jim Peters, Whirlpool’s stock price hit a new 52-week low during the trading session, at $92.64, before closing at $94.97, off almost eleven dollars from Wednesday’s close. Whirlpool’s 52 week high was $160.60 last July.
Bitzer and Peters were insistent during the conference call that their strategy is working, pointing at declining costs amid so-called ‘organizational simplification’, the cutbacks currently underway that will result in 1000 administrative employee layoffs when completed in May, as well as five percent price increases at the major appliance retail level.
Bitzer said continued inflation and high materials costs have been challenging. However, he cited strong and growing demand for the company’s high margin Small Appliances, many under the KitchenAid brand, as a sign of good things ahead. He also emphasized that Whirlpool maintains its strong position with home builders, poised to benefit as the housing market recovers when interest rates ease.
CFO Jim Peters acknowledged the recently reported 1000 employee target number for what the leadership team is now calling ‘organizational simplication.’ Many of those cuts are driven by Whirlpool’s exit from the European market at the operational level. The company remains a 25% investor in a European appliance partnership and licenses its brands for Europe, but no longer manufactures major appliances in Europe.
Meanwhile, Bitzer says Whirlpool’s Latin American brands are doing well, particularly in Brazil and Mexico. And he also sees India as an important market in Whirlpool’s future.
