Whirlpool Corporation (WHR) Bundle
A Brief History of Whirlpool Corporation
Whirlpool Corporation, a leading global manufacturer of home appliances, has undergone significant transformations and strategic changes leading up to 2024. The company is recognized for its broad portfolio of brands, including Whirlpool, Maytag, KitchenAid, and others, and operates in various geographical markets, including North America, Latin America, Asia, and Europe.
Company Overview
As of 2024, Whirlpool operates through five primary segments: MDA North America, MDA Latin America, MDA Asia, SDA Global, and MDA Europe, which was deconsolidated as of April 1, 2024. The company has been focusing on enhancing its operational efficiency and market presence through strategic divestitures and acquisitions.
Financial Performance
For the third quarter of 2024, Whirlpool reported consolidated net sales of $3.993 billion, a decrease of 18.9% compared to $4.926 billion in the same period of 2023. The decline is attributed to unfavorable product price/mix and lower sales volumes. For the nine months ended September 30, 2024, net sales totaled $12.471 billion, down from $14.367 billion in 2023, reflecting a 13.2% decrease.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales (Millions) | $3,993 | $4,926 | -18.9% |
| Gross Margin (Millions) | $643 | $799 | -19.5% |
| Net Earnings (Millions) | $109 | $83 | +31.3% |
| Earnings per Share (EPS) | $2.00 | $1.53 | +30.7% |
Strategic Changes and Divestitures
In early 2024, Whirlpool executed a significant divestiture by contributing its European major domestic appliance business to a newly formed entity with Arcelik. This transaction, finalized on April 1, 2024, resulted in a loss on disposal of approximately $294 million for the nine months ended September 30, 2024, which significantly impacted the company’s financials.
Segment Performance
Whirlpool's performance varied across its geographical segments during the third quarter of 2024:
- MDA North America: Net sales decreased by 4.3%, with an EBIT margin of 7.3%.
- MDA Latin America: Net sales increased by 0.4%, with an EBIT margin of 6.9%.
- MDA Asia: Net sales increased by 9.1%, with an EBIT margin of 2.9%.
- SDA Global: Net sales decreased by 3.0%, with an EBIT margin of 14.2%.
| Segment | Net Sales (Millions) | EBIT Margin (%) |
|---|---|---|
| MDA North America | $7,642 | 7.3% |
| MDA Latin America | $2,578 | 6.9% |
| MDA Asia | $818 | 2.9% |
| SDA Global | $629 | 14.2% |
Cash Flow and Liquidity
As of September 30, 2024, Whirlpool had cash provided by operating activities of $(271) million, compared to $(322) million in 2023. The company expects to generate approximately $1,050 million in cash from operating activities for the full year 2024, with free cash flow projected at $500 million, factoring in restructuring costs and capital expenditures.
| Cash Flow Metrics | 2024 | 2023 |
|---|---|---|
| Cash from Operating Activities (Millions) | $(271) | $(322) |
| Free Cash Flow (Millions) | $500 | Not Disclosed |
| Capital Expenditures (Millions) | $550 | Not Disclosed |
Overall, Whirlpool Corporation's financial landscape is shaped by strategic decisions aimed at enhancing operational efficiency amidst challenging market conditions. The company's ability to adapt to these changes will be critical as it navigates through the evolving appliance market in 2024.
A Who Owns Whirlpool Corporation (WHR)
Major Shareholders
As of 2024, the ownership of Whirlpool Corporation (WHR) is distributed among various institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership stakes:
| Shareholder | Ownership Percentage | Type of Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 9.01% | Institutional Investor |
| BlackRock, Inc. | 8.43% | Institutional Investor |
| State Street Corporation | 4.30% | Institutional Investor |
| Wellington Management Co. LLP | 4.05% | Institutional Investor |
| Invesco Ltd. | 3.23% | Institutional Investor |
| Other Institutional Investors | 45.68% | Various |
| Individual Shareholders | 25.00% | Individual Investors |
Recent Changes in Ownership
In February 2024, Whirlpool executed the sale of 30.4 million equity shares of Whirlpool India, thereby reducing its ownership from 75% to 51%. This sale generated proceeds of approximately $462 million.
Equity Method Investments
Whirlpool Corporation also holds equity method investments, notably in Beko Europe B.V. and Whirlpool China. The carrying amounts of these investments as of September 30, 2024, are as follows:
| Investment | Percentage Ownership | Carrying Amount (Millions) |
|---|---|---|
| Beko Europe B.V. | 25% | $156 |
| Whirlpool China | 20% | $188 |
Financial Overview
For the nine months ended September 30, 2024, Whirlpool reported a net loss available to shareholders of $69 million, with diluted earnings per share of $1.26. The total stockholders' equity as of September 30, 2024, was approximately $3.293 billion.
Market Capitalization
As of the latest available data in 2024, Whirlpool Corporation's market capitalization is approximately $9.2 billion.
Dividends
Whirlpool has maintained a consistent dividend policy, declaring dividends of $1.75 per share for the year 2024, totaling $5.25 for the year.
Conclusion of Ownership Structure
The ownership of Whirlpool Corporation is characterized by significant institutional investment, strategic divestitures, and ongoing equity method investments. The company continues to navigate changes in ownership and market conditions while maintaining a strong dividend policy.
Whirlpool Corporation (WHR) Mission Statement
Mission Statement Overview
Whirlpool Corporation aims to create a better home for all by delivering innovative products and services that enhance the quality of life for consumers globally. The company emphasizes sustainability and community engagement in its mission.
Core Values
- Innovation: Driving progress through research and development.
- Sustainability: Commitment to minimizing environmental impact.
- Quality: Ensuring high standards in products and services.
- Community: Engaging with and supporting the communities where they operate.
Strategic Goals for 2024
Whirlpool's strategic goals for 2024 focus on enhancing operational efficiency, expanding market share, and prioritizing customer satisfaction.
| Strategic Goal | Description | Target Metric |
|---|---|---|
| Increase Market Share | Expand presence in emerging markets. | 5% growth in net sales |
| Sustainable Products | Launch new eco-friendly appliances. | 25% of new products to be sustainable |
| Operational Efficiency | Reduce manufacturing costs through automation. | 10% reduction in production costs |
| Customer Satisfaction | Enhance customer service and support. | Increase customer satisfaction scores by 15% |
Financial Performance - Q3 2024
Whirlpool's financial performance for the third quarter of 2024 reflects significant changes following the divestiture of its European major domestic appliances business.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $3,993 million | $4,926 million | (18.9)% |
| Gross Margin | $643 million | $799 million | (19.5)% |
| Net Earnings | $109 million | $83 million | 31.3% |
| Diluted EPS | $2.00 | $1.53 | 30.7% |
Recent Developments
In early 2024, Whirlpool executed the sale of its European business segment, resulting in a significant adjustment of its financial outlook. The estimated fair value of the disposal group was approximately $227 million, which included $186 million related to retained interest in Beko Europe B.V.
Future Outlook
For the full year 2024, Whirlpool expects to generate approximately $1,050 million in cash from operating activities and $500 million in free cash flow. The company anticipates restructuring cash outlays of around $80 million and capital expenditures of approximately $550 million.
How Whirlpool Corporation (WHR) Works
Company Overview
Whirlpool Corporation is a leading kitchen and laundry appliance manufacturer, operating through various brands including Whirlpool, KitchenAid, and Maytag. As of 2024, the company reported approximately $19 billion in annual sales and employs around 59,000 individuals across 55 manufacturing and technology research centers.
Operating Segments
Beginning January 1, 2024, Whirlpool operates through five segments:
- MDA North America
- MDA Latin America
- MDA Asia
- MDA Europe (deconsolidated as of April 1, 2024)
- SDA Global
Financial Performance
For the third quarter of 2024, Whirlpool reported net sales of $3.993 billion, a decrease of 18.9% compared to $4.926 billion in the same period in 2023. The ongoing EBIT margin was 5.8%, down from 6.5% year-over-year.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $3.993 billion | $4.926 billion | (18.9) |
| Gross Margin | $643 million | $799 million | (19.5) |
| Selling, General, and Administrative Expenses | $395 million | $473 million | 16.5 |
| Net Earnings | $109 million | $83 million | 31.3 |
| Earnings Per Share | $2.00 | $1.53 | 30.7 |
Cash Flow and Financing Activities
In the nine months ended September 30, 2024, Whirlpool experienced cash provided by (used in) operating activities of $(271) million, compared to $(322) million in the same period of 2023. The free cash flow for the same period was $(586) million, a slight improvement from $(660) million in 2023.
| Cash Flow Metric | 2024 | 2023 |
|---|---|---|
| Cash Provided by Operating Activities | $(271) million | $(322) million |
| Capital Expenditures | $(315) million | $(338) million |
| Free Cash Flow | $(586) million | $(660) million |
Debt and Interest Expenses
As of September 30, 2024, Whirlpool's total long-term debt was approximately $6.382 billion. The interest expense for the three months ended September 30, 2024, was $92 million, compared to $95 million during the same period in 2023.
Recent Strategic Actions
Whirlpool's strategic review resulted in the divestiture of its European major domestic appliance business, which was deconsolidated on April 1, 2024. This transaction led to a loss on disposal of $1.9 billion recorded during the nine months ended September 30, 2024.
Segment Performance
The following table summarizes the net sales and EBIT for Whirlpool's operating segments for the nine months ended September 30, 2024:
| Segment | Net Sales (in millions) | EBIT (in millions) |
|---|---|---|
| MDA North America | $7,642 | $491 |
| MDA Latin America | $2,578 | $175 |
| MDA Asia | $818 | $38 |
| MDA Europe | $804 | ($9) |
| SDA Global | $629 | $97 |
Balance Sheet Overview
As of September 30, 2024, Whirlpool's total assets were reported at $17.160 billion, down from $17.312 billion at the end of 2023. The company’s stockholders' equity totaled approximately $3.293 billion.
| Balance Sheet Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $17.160 billion | $17.312 billion |
| Total Liabilities | $13.867 billion | $13.775 billion |
| Stockholders' Equity | $3.293 billion | $2.537 billion |
How Whirlpool Corporation (WHR) Makes Money
Revenue Generation Overview
Whirlpool Corporation operates through five primary segments: Major Domestic Appliances North America, Major Domestic Appliances Latin America, Major Domestic Appliances Asia, Small Domestic Appliances Global, and Major Domestic Appliances Europe (deconsolidated as of April 1, 2024). In 2023, the company reported approximately $19 billion in annual sales.
Financial Performance in 2024
For the three months ended September 30, 2024, Whirlpool reported net sales of $3,993 million, a decrease of 18.9% compared to $4,926 million for the same period in 2023. For the nine months ended September 30, 2024, net sales were $12,471 million, down from $14,367 million in the prior year, representing a 13.2% decline.
| Financial Metrics | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Sales (in millions) | $3,993 | $4,926 | -18.9% |
| Gross Margin (in millions) | $643 | $799 | -19.5% |
| Operating Profit (in millions) | $265 | $257 | +3.1% |
| Net Earnings (in millions) | $114 | $85 | +34.1% |
| Basic EPS | $2.01 | $1.53 | +31.3% |
Cost Structure
The cost of products sold for the three months ended September 30, 2024, was $3,350 million, compared to $4,127 million in the same period in 2023. This indicates a decrease of 18.8%. The gross margin for the third quarter of 2024 was 16.1%, down from 16.2% in the prior year.
Divestitures and Strategic Moves
In 2024, Whirlpool executed significant divestitures, including the sale of 30.4 million shares of Whirlpool India, generating proceeds of approximately $462 million. This sale reduced Whirlpool's ownership from 75% to 51%.
Additionally, the company disposed of its Brastemp water filtration subscription business in Latin America, realizing proceeds of approximately $52 million.
Investment in Innovation and R&D
Whirlpool continues to invest in innovation, with a commitment to research and development expenditures to enhance its product offerings. The company expects to allocate approximately $550 million for capital expenditures in 2024.
Cash Flow and Liquidity Management
As of September 30, 2024, Whirlpool reported cash and cash equivalents of approximately $1,084 million. The company anticipates generating cash from operating activities of about $1,050 million for the full year.
Debt and Financing Activities
Whirlpool's current liabilities include approximately $350 million of debt maturing within the next twelve months, which is expected to be managed through refinancing and cash flow generation.
Market Demand and Future Outlook
For 2024, Whirlpool anticipates flat demand in the Major Domestic Appliances North America segment, with modest growth projections of 5-7% in Latin America and 4-6% in Asia.
| Segment Performance Metrics | MDA North America | MDA Latin America | MDA Asia | SDA Global |
|---|---|---|---|---|
| 2024 Net Sales (in millions) | $7,642 | $2,578 | $818 | $629 |
| 2023 Net Sales (in millions) | $8,130 | $2,395 | $748 | $607 |
| EBIT (in millions) | $491 | $175 | $38 | $97 |
Conclusion on Revenue Sources
Whirlpool's revenue is primarily driven by its diverse product lines in home appliances, complemented by strategic divestitures and ongoing investments in innovation. The company's focus on operational efficiency and cost management is evident in its financial performance amid challenging market conditions.
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Article updated on 8 Nov 2024
Resources:
- Whirlpool Corporation (WHR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Whirlpool Corporation (WHR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Whirlpool Corporation (WHR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.