A three-month run-up of some 27-percent in the stock price at Whirlpool Corporation began sinking rapidly even before the market opened today after the Benton Harbor-based appliance giant reported quarterly and annual earnings this morning. Shares had fallen by more than 4.5-percent in pre-market trading, recovered ever so briefly when they rang the bell, and then went into a dive dropping to as low as $175.00 per share in the first half-hour of active trading on Wall Street. The stock closed above $190.00 per share at the end of the business day Wednesday. While the company reported a rise in sales, they also posted lower-than-expected profits in the fourth quarter and fell short of the street’s expectations.
The stock was off by more than 7.6-percent by 10:00am after Whirlpool said acquisition costs offset higher sales from their largest market in North America.
Whirlpool announced fourth quarter net earnings of $180-million, or $2.36 per diluted share, compared to an equal performance of $180-million, or $2.28 per diluted share in the same period a year ago. Fourth-quarter ongoing business earnings per diluted share totaled $4.33 compared to $4.10 in the prior year period.
The $4.33 earnings per share for the quarter missed analyst’s consensus estimates of $4.39 by 6-cents.
Chairman & CEO Jeff Fettig says, “We delivered our fifth consecutive year of record ongoing earnings per share through the continued execution of our long-term strategic priorities.” He adds, “We also continued to create value through our capital allocation strategy, funding our innovation programs with strong levels of investment while returning a record $800-million to shareholders through dividends and share repurchases.”
Fourth quarter net sales were $5.7-billion, compared to $5.6-billion in the same prior-year period. Excluding the impact of currency, sales increased more than 2-percent.
For the full year, net sales were $20.7-billion compared to $20.9-billion in 2015. Excluding the impact of currency, sales for the full year increased by 2-percent. Operating profit totaled $1.4-billion, as compared to $1.3-billion in the prior year. Full-year ongoing business operating profit totaled $1.6-billion, or 7.8-percent of sales, as compared to $1.6-billion, or 7.5-percent of sales, in the prior year. Net earnings per share increased to $11.50, compared to $9.83 in the prior year. Ongoing business earnings increased to $14.06, compared to $12.38 in the prior year.
Whirlpool President & Chief Operating Officer Marc Bitzer was upbeat, saying, “We have demonstrated our ability to effectively manage volatility in a disciplined and decisive manner.” He adds, “We remain focused on delivering profitable revenue growth and improving working capital through operational execution and have high confidence that we will achieve our goals in the coming year.”
