Whirlpool Corporation (WHR – Free Report) reported mixed fourth-quarter 2017 results with earnings topping estimates while sales missed the same. While the company posted a positive earnings surprise after five consecutive misses, sales lagged for the third straight quarter. Further, management provided earnings outlook for 2018. Moreover, the company hinted at margin gains in the year.
Shares of this world’s leading home-appliances manufacturer declined nearly 1% in the after-hours session yesterday, probably due to its lower-than-expected sales. Though this Zacks Rank #3 (Hold) stock lost 9.6% in the past three months, it fared better than the industry’s decline of 21.7%.
Q4 Highlights
Whirlpool’s quarterly adjusted earnings per share came in at $4.10, ahead of the Zacks Consensus Estimate of $4.01. However, it declined 5.3% from $4.33 per share earned in the year-ago quarter.
Whirlpool Corporation Price, Consensus and EPS Surprise
On a GAAP basis, the company reported net loss of $3.69 per share against earnings per share of $2.36 in the prior-year quarter. The loss reported can primarily be attributed to a non-cash charge of $420 million associated with the new tax reform.
Revenues of $5,702 million rose nearly 1% from the comparable year-ago quarter revenues of $5,656 million. However, the top line fell short of the Zacks Consensus Estimate of $5,836 million. On a currency-neutral basis, sales declined of 1.6%. Top-line growth was driven by gains in Latin America and EMEA regions.
Further, adjusted operating profit in the quarter dropped 9% to $392 million from $431 million in the year-ago quarter. Also, the operating margin contracted 70 basis points (bps) to 6.9%. During the quarter, unit volume declines and raw material inflation completely negated the gains from favorable cost productivity, product price/mix and restructuring benefits.
Regional Performance
Revenues from North America remained flat with last year at $3.1 billion, while it dipped 0.8% on a currency-neutral basis. Adjusted operating profit margin expanded 60 bps to 11.8%. In dollar terms, operating profit grew 5.4% to $368 million. Notably, operating profit gains reflected from favorable product price/mix which mitigated the negative impact of raw material inflation.
