Whirlpool sees profit dip in Q1

Whirlpool has seen earnings drop in the first three months of 2016, ending March 31.

The appliance manufacturer reported Q1 net earnings of $150 million (£103m) compared with $191m for the same period in 2015.

Net sales decreased from $4.8 billion in the first quarter of 2015 to $4.6bn in Q1 2016. This plunge was attributed to currency exchanges, with Whirlpool revealing that sales increased by one per cent.

Operating profit totalled £283m compared with $303m in the same period in the previous year.

However, the company saw record first-quarter, ongoing business operating profit at $339m – approximately 7.3 per cent of sales. This was compared with $318m, or 6.6 per cent of sales, for the same period in the previous year.

Whirlpool said acquisitions, cost and capacity reduction initiatives and ongoing cost productivity offset unfavourable currency and weak emerging market demand.

Focusing on Europe, the Middle East and Africa, Whirlpool announced a boost in first-quarter operating profits to $55m, compared with $17m in Q1 2015. This was despite the fact that Q1 net sales in the region fell to $1.2 billion from $1.3bn the previous year. It also saw EMEA sales decrease by 3 per cent.

The company added that it expects full-year 2016 industry shipments to be somewhere between flat and 2 per cent up.

Whirlpool chairman and chief executive Jeff Fettig said: “Our record first-quarter results were in line with our expectations and we completed our existing share repurchase programme. We remain confident in our ability to deliver our 2016 guidance, as we capitalise on robust demand in the US, new product introductions and strong productivity around the globe.”

Whirlpool also said it expects to generate free cash flow of $700 to $800m for the full year in 2016.

Mr Fettig added: “Our strategy to create long-term value for our shareholders remains unchanged. We remain focused on delivering substantial shareholder value by leveraging our leading brand and product innovation, larger global footprint and best cost structure. In addition to our strong business performance, with our $1 billion share repurchase programme and increased dividend we have appropriate flexibility to deliver on our capital allocation priorities.”