WHR - Earnings call transcript Q4 2019

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Operator

Good morning, and welcome to Whirlpool Corporation's Fourth Quarter 2019 Earnings Release Call. Today's call will be recorded.

For opening remarks and introductions, I would like to turn the call over to Senior Director of Investor Relations, Roxanne Warner. Please go ahead.

Roxanne Warner

Thank you, and welcome to our fourth quarter 2019 conference call.

Marc Peters, Chairman our are Officer; Chief today Jim and Chief me Bitzer, and our Executive Joining Financial Officer.

starts our today Investors remarks with available presentation Our on section of website whirlpoolcorp.com. at the the

I'll begin, will understanding we Whirlpool forward-looking this making future expectations. we as we remind Before be you assist conduct to statements Corporation's call, that in you

want that XX-K these not from our factors results discussed many presentation actual Our ongoing and periodic measures. these due other statements We results you that operations of could indicators measures differ to they to reports. non-GAAP operations. includes are may business We our exclude indicative items today's of materially latest remind as from believe be in our important

you in to the analyzing of baseline We comparable also to website a posted information of think better measures. our the our most are the directed business for the trends operations. the Listeners supplemental Relations section on package reconciliation provide for Investor adjusted GAAP items ongoing will non-GAAP directly measures

this in participants mode. listen-only are a all At time,

Following will for questions. be call our remarks, analyst opened prepared the

we reminder, two no more a As that participants questions. ask ask than

over that, turn With I'll Marc. to call the

Marc Bitzer

margins the the the EBIT performance in point led delivered Canada. as all XX.X%, globe demand basis net our ongoing good Slide strong and On highlights. record delivered expansion to X, strong very regions EBIT. We across margin sales EBIT demonstrated organic and We America we quarter XXX Thanks, results, increase. growth everyone. positive North despite U.S. of XXXX and a show softness morning, fourth X.X% of a X.X%, industry

our the consecutive Africa actions. to our European drive to sequential and improvement quarter in This providing in confidence Europe, realize profitability region represents Middle In region, of we and second strong East strategic a continued region XXXX. EBIT ability the of the benefit our full to

improvements flow result of efficiencies. and million driven by free strong with capital This regions. over working was contributions from Additionally, all we $XXX capital delivered cash positive spend

to of sheet towards to X target EBITDA [ph]. made Lastly, we gross strong balance strengthen progress our approximately continue and debt our long-term

Slide over mix compared X, strong cash share free million on flow guidance our of announcing of and million. year our EBIT challenging initiatives of full guidance. a points XX very by We margin ongoing action to approximately above Turning took discuss through $XXX in of innovation. decisive basis $XX.XX our $XXX to expansion delivered product pricing I to driving earnings global With environment positive executing and successfully record cost-based ongoing We a will $XX.XX per $XX highlights. and

our Additionally, our and headwinds while to we disciplined from significant chain takeout and remain in approach cost cost continue overall material optimize tariffs inflation. overcoming to value

investment continued trade the and business to goal. Despite for strength long-term the we in and repurchases strategy have of fundamental our cash and right consecutive seventh to returned of share macroeconomic significant levels fully dividend and deliver strong shareholders confidence we needs place and challenges, a through provide These our us our increased year. our funded demonstrate business results

margin full-year will mix and fourth pricing Slide point drivers from delivered basis In of expansion. of quarter, product benefit the as realized XXX launches. our expansion and to actions margin fourth X, I mix the quarter price we Turning benefit show the of

cost net Additionally, we quarter. delivered positive takeout the in

favorable materials were margin North impact in However, and technology offset resulting These by unfavorable the continued and marketing benefits tariff of improving America, of raw headwinds points. offset investments currency. XX impact trends partially than basis in continued more a in

our deliver and in will positive price over drive partially Overall, from mix expansion margin the to momentum deliver this slightly an very are margin of results commitments increased strong was very offset year tariffs, on strong impact we're by currency. to brand continue investments full Our and XXXX. pleased confident even

our review regional Now, I'll to turn results. to it over Jim

Jim Peters

Thanks morning, everyone. Marc, good and

to Slide region. Canada, the softness quarter I'll the stable delivered despite review agility business. industry highlighting our U.S. America Turning in fourth results for of We X, revenue, and and North the strength our underlying

we and from XX.X% fixed strong to the region disciplined points margin price as Difficulty]. offset Additionally, making and inflation. mix quarter, headwinds drove quarter of execution improvement takeout record of expansion cost cost cost consecutive the [Technical with continued margin margin in ninth XXX delivered basis EBIT The leverage it consistent

our Turning Middle to fourth results region. quarter review Africa the we and Europe, for Slide X, East

Italy, approximately and soft flat by Europe, were Eastern business was East exits, Excluding with Middle and in offset which France unit demand. volumes growth Africa

our region, cost line reduction Momentum EBIT the including profitability are December track to to on and initiatives rates and year-over-year initiatives the annual These we exit fully top Middle us return of in remain realized to of line in We $XXX and our with XXX an $XX with EBIT million be with guidance in delivered expansion region basis ability strategic XXXX. on in margin approximately see growth to in delivered across million approximately East basis Africa. This provides sustained points. benefit pleased strong our confidence from XXXX. improvement in a

benefits Organic turn XXXX sales X America sales demand. devaluation were very driven volume region. in continued strong which currency quarter for sales. EBIT margins Brazil and direct the XX% increased the by raw Unit in share to Embraco than favorable net contracted review Slide in more Latin significantly we Brazil productivity cost Offsetting Brazil as and to alongside a industry our material Now results Argentina. offset excludes approximately fourth to and in by increased gains weakness rebound quarter consumer Mexico. inflation

compressor of results quarter turn which results Slide results. We Finally as to shown are on now fourth include a XX. consolidated impact the XXXX our fourth Embraco reminder, for its region Asia our the business in the quarter

remain negative of the currency, share year-over-year. India investments These in delivered which brand demand top gains, investments track EBIT in by was strong impact in share flat with sequentially as on and India Excluding were industry Whirlpool sales double-digit net brand and by growth increasing approximately was offset transition China. offset line China. continued

it guidance to review our over to to Marc I'd operational turn back Now priorities. and like

Marc Bitzer

Thanks, Jim.

Turning to sales our drive expect In long-term XXXX. we'll net goals, growth guidance review X%. we Slide to of assumption approximately organic line XX, our for with

to deliver EBIT about expect approximately an We ongoing margin, XX increase point. basis of X.X%

cash from our $XXX guidance free unfavorable impact items. is of $XXX one-time million net which million $XXX a million, to flow includes Lastly,

to XX, [indiscernible] X.X% Turning margin guidance in Slide drivers of approximately ongoing XXXX. EBIT

as our We points XX and to of mix basis price products related expect approximately improvement to and services deliver innovative new customers. we

basis expect to improvement. XX points drive net We of cost approximately

of and reduction we global the As realize benefits complexity our standardization initiatives.

journey materials drive tariffs points approximately what XXXX in on year-over-year a XX expected been on announced date, to has results, based are we to have basis not favorable impact trends expect raw do Additionally, an expansion. to margin expect while approximately points unfavorable of continue impact margin from basis currency basis of our a impact and as we we in Further, points. negative XX of invest XX digital transformation to approximately

few which to XX, to innovative highlight Moving drive a us just of XX products during our want we positive to price mix allow and Slide XXXX.

Extra purposeful connected as a The entire customer Pre-Treat first our slide in premium and of dispenser will Power premium achieve capable laundry segment. These launch laundry shows an function. leadership year, this North and needs throughout Load load how will products replacing product innovation the top products the meet we America first to new top Go quarter segment. such Station have load These

innovative third Asia and rack product first to a our The full ever first a and second the in in premium expect launch more new segments as which build XX fully rack a available result America to the our at able set are just and exciting features functioning spray are North these few full consumer globally, true on slide innovations mass with to is global in that leveraging to relevant drive in arm, example positive highlights later importantly, that will efficiencies. dishwasher in our the quarter mix. market. therefore, largest compressor innovative this in Europe. improvements these of stage a significant architecture, By and expect this price to architecture in examples our Even reduction, We features. we major a growth parts cost see drive driving new third continue of launch year we Again,

Jim back guidance a it turn few highlight I'll to Now, to items. remaining

Jim Peters

Marc. Thanks,

to $XX $XX Turning XX, expect of we to share XXXX. deliver Slide ongoing per earnings to in

compared rate $X.XX. in in late The rate. a be XXXX approximately headwind XX% change law effective is impacted favorably in tax ongoing of XX.X% European XXXX, expected year-over-year to resulting Our XX% tax to tax to our

rate our have near benefit, of guidance. this would tax midpoint previous been Excluding our the

XX% several to further Additionally, XX% of in benefits current years strategies rate from prior our and tax effective are range. reform our increasing to our longer no XXXX,

totaling mentioned earlier, we points, all in accretion. drive as resulting earnings strong regions, approximately XX we expect expansion EBIT margin in Secondly, basis to

related includes to includes Our headwind a earnings XXXX $XX per of guidance approximately Embraco. million EBIT $X.XX share as

term billion lower of Additionally, expense interest loan XXXX. repayment moderately $X after our in the we expect

continue we we to specific XXXX highlight do that XXXX share benefit a as the guidance not carryover provide and buybacks, to not repurchase at our shares level. reflect moderate while Lastly, for driver. from a We do expect

show while yet translated America, On growth has into weakness for XX, higher are while improvements by outlook the in North we expect in cautious housing regional America, maintain industry a of continued for to we EMEA, of in expect of modest X% Brazil Mexico. our Slide signs Starting with that our demand year. guidance strengthening positive show demand, we U.S. not the starts Latin continuation as we offset X% appliance growth, demand. In

demand as flat pressure India flat is China. expected XXXX. In expect is global total, by to industry growth for the in to Asia appliance offset continued approximately we in be approximately industry be

mix our North focused cost price favorable margin continued product guidance, related we discipline by driven expect and new to Regarding America, introductions. EBIT in expansion

realize margin expect basis profitability, to fully we of the restore points. XXX over resulting EMEA, strategic to In EMEA EBIT in benefits our to continue to of expansion actions

in America, X% actions, Brazil EBIT demand the to devaluation offset XXXX, in direct by weakness in reminder, In margins second of expect consumer half demand sales business half. Brazil. as primarily improvements including we and in several the are approximately in our Argentina executed currency and and a accelerating we Latin exits As first driving to Mexico benefits strategic deliver

weak of strong X% progress China. we continued expect of and will offset our In deliver in to long-term improvement XX Asia margin expect Lastly, deliver operations total, margins expectations achieve towards that approximately and basis operational initiatives X% in we are India to to priorities partially are points our as EBIT confident goals. by demand

cash of to Slide the XXXX XX, Turning will free I drivers discuss flow. our

billion expansion, $X.X margin approximately Embraco. deliver earnings, by primarily by to driven offset of cash in the expect sale We

in million $XXX we continue capital expect in business. as to expenditures We invest our

inventory to approximately through of fully we $XX launches product working across we deliver improvement capital globe. million expect primarily reduction initiatives the as Additionally, key transition

million $XXX cash outlays facility. manufacturing of restructuring the Italy we And which Naples, of re-industrialization expect our includes

deliver to approximately was found items this these million appendix Lastly, $XXX of negatively cash free In details flow. Further total, items. we related $XXX flow expect of cash can one-time impacted by the several $XXX million free be to in to of million presentation.

we Turning for fourth capital on funding our update the approach while expect year. at We approximately and XX, million approximately quarter moderate committed of cash remain in we our for the the is return in our repurchasing our to with sheet repurchased XXXX. continue long-term strengthen an X. Consistent priorities debt growth, In at shares our to shares Day, continuing to with business balance to Slide of provide and on Investor levels EBITDA capital allocation, shareholders. track to balanced guidance allocation towards fully target $XX gross to to line

that we our earnings no and announce longer to like including our XX-K I'd sold report in in April, materials, units XX-Q. will Lastly, starting

in to what product revenue Yummly's as and subscription incremental invest an not value plus to wireless redefine is, as this thermometer. we digital Smart and to Further, long-term launch continue as increase creation the Oven from our lead KitchenAid in continue such journey products services, Yummly smart Pro unlock such reported the revenue will stone baking through and digital upcoming transformation our products service. of we units from As

our As units performance. of XX-Q becoming an our are less overall materials, and of eliminate Consequently, units indicator a reporting XX-K. we will earnings sales result, in our including

remarks questions. our and up end it for formal will we open Now

Operator

go ahead. Your comes from question with Capital Dahl Markets. RBC of Instructions] Please line [Operator the Mike first

Mike Dahl

appliances? thinking I Good the dynamics given we and had on in small [indiscernible] your were a think said, American partners then and North some you timing us to just major expecting in And with XXXX? but all trade questions shipments, just I the rebound both be indicated just of wanted a like talk small progressing last about into for my how taking around and side quarter. a appliance Can couple bit in should Thanks we you potentially start morning. it just questions. major a what volumes follow-up your seems comment and out quarter shifts how appliance that's maybe around what the in the quarter, little through appliances below maybe last inventory the Jim on, weak volumes about happened units,

Marc Bitzer

Marc So Bitzer. Mike, it's

let North America. NA QX, in as So the on for in unit me volume total, which decline -- a reported we you comment know, X.X%

Now, for business of entire want majors remind does keep not the in and what mind, just X.X of if of spectrum pure AM everybody one encompass first indication, one to sell, that's but all take minus numbers course which the were the quarter, we part of that. you

period. pure we business about share offer share market market we we in during majors then QX, If held so where good you look approximately feel at particularly and promotional the pretty

to business, that has market have parts On the of Canada Canada impact. Canadian the market itself keep in is mind, continues an and decline might a in other there.

frankly, that year to KitchenAid trade normal the end are sell inventories volume, the which the SDA, inventories solid around very into but the we expect year pretty proof on did the and trade they did, than feel quarter, back good pretty of the stable. the is On the before, SDA about we SDA brings levels coming so the and lower

of much again Jim major pretty and maybe are the reporting. comment you units to these components, a So want on

Jim Peters

part And -- I lot business at globally, look services sales. aren't as count unit our consumables world increasing on Mike. normally mentioned, an other products we our then units and or increase that as of our there reporting, a of in the are of included parts where Yes, the

a So looked has whether today, of it a indicator products and we're consumables sell was while better fall there attachments stuff so it it less relevant attached and indicator be, we've revenues a it a or a a services we be cord mix of as be, to lot I don't felt mentioned that into basis. is we stand the typically unit doing or that on is something just licensed power global more at how that now it'd much

Mike Dahl

second was Okay, question. my that And thanks. actually be to going

those in -- components new of to way of major transition is before us or reporting you sense -- just by what Just represent any a size there those region? the you today give either up aggregate kind just can but

Jim Peters

a we look I think switch I'd say at measures those that right disclose our it's new becoming that part sales Yes, don't of this by we now all said, specifically what ongoing we as to we region we'll we relevant and should more and model, as think be communicating.

Mike Dahl

Okay. Thank you.

Operator

go comes question Please of with line the Your next from Michael Rehaut JPMorgan. ahead.

Michael Rehaut

Good everyone. Thanks. morning,

always. view was quarter, or of lot the questions how on may past was First is comment been concern chatter North we've promotional with that question gotten you'd of the affected not given I there on may competitive the is your the LG dynamics. there a competitive I backdrop perpetually had and the always ramp Samsung in a and lot just as year around have fourth in seasonally, of if lines, hoping the but of environment the America. There's

lift quarter, could the if on but year-over-year? related you fourth up comment that all? in contributed is having of to And trend the maybe that plants how has think those a ramp been to view you if at I anything

Marc Bitzer

So it's Marc. -- Michael, it's

years our and As last been so last along in North margin America. almost we you consistent has the America. around background There there XX the XX based question in mentioned already question, years i.e., competitive perennial for in are the North expanded with on

it's playing highly we embedded when margins particular, demonstrated a Machine always that but So think it environment. that welcome factories competitive comes we to also can expand confident because I of Washing very feel competitive two be despite we intense managed said, course can an and a we've we level environment, impressively as we it's that environment. the of compete field we onshoring In

impact on I much environment So that as broader environment. production. from the such no say onshoring with negative the a intense of competitive same would the pretty

market Yes, EBIT to promotional And in contraction. in from even despite broader intensity on North promotional environment, that a on but marketplace. not question that declining We slight us, we delivered a are particularly surprise entirely seen deliver the we that but to a very very, in which doesn't the America two even promotion demonstrate competitors, able a margins. strong saw you've XX.X% in also your the markets margin related environment. Particularly uptick QX, entire

Michael Rehaut

Right.

So very I impressive. American appreciate that, Marc. is obviously And to on very, in my maybe as dive more second bit just which question a North little margins the

driving being obviously mix particular, the about a volume that more sense obviously don't particularly If of year-over-year granular curious basis any was drivers in have productivity, that also have improvement and contributor the of. just you price the cost perhaps you I'm could advantage bucket you leverage there additional what's of us take as and any XXX component, lot point around what to give

driving So really other what bucket? that was

Jim Peters

this start with is I'd to that. maybe say for America, the similar said a levers Michael, we Yes what globally. driven was North Jim, by expansion let margin me little bit

difference there. we within so net We quarter. cost what And mix in a a progression America not a From have cost began price and seeing we're about one in the significant stable this seeing also did obviously we quarter. and there's positive within going see within perspective, is to North into materials, as very tariffs terms on XXXX, of and were there headwinds reduction what talked we're some

similar whole that you did quarter. what So we make on the for walk to see positive our then some was us investments for and

it and of environment cost positive nothing what we and we offset of was demonstrated some So mix then that to America a that headwinds the cost outside deal unusual globally there's within pricing North with. had really

Michael Rehaut

you. Great. Thank

Jim Peters

Michael. Thanks,

Operator

Maklari Susan of with line the from comes Goldman question next Your Sachs.

is Your open. line

Susan Maklari

kind morning. inflation and you're how XXXX? with key input To a steel about other about you off bit Thank talk can prices seeing and you. of start Good little

Jim Peters

Susan. Yes,

inflation headwind comes what times, total we business, XXXX. in throughout is value basically several total that let takeout. to we cumulative terms saw and of We that coming cost a of into slowly $XXX had in the the around in for million coming -- And chain first around me QX particular in much materials, raw and tariffs, our it when inflation entire we mid-year our was repeat a XXXX. cost of of That So particular, still logistics. said and inflation pretty QX as net in result

of raw the more impact around a side. one. for on in If then you've QX. terms much we also saw with pretty material material the you in raw XXXX, break the QX this on and guidance it down external our factors Yes churn globally as in And number in we improvement a more expect seen

since had has time. What with our at to based we was last call changed what because outlook the last that And the tariffs our announced on outlook is earnings in on work of what will year-over-year we see today not impact, X.X% we that, know materials. now that a have as just basically and result coming from better negative this a margin raw expansion tariffs

like elements around. don't inflation or yet turning we other far other logistics see cost so The elements,

still XXXX really priority is reversed and double our that working But throughout key system. takeout and what and will we gone we're again environment, inflationary but cost operational to entire certainly summarizing, that's kind describe trying of our of not I address. and it's down improve would obviously is not the against So completely to an us see less

Susan Maklari

from how the the improvement the relative talk core the that this restructuring your kind just Thank business that of position quarter maybe you've of some of EMEA actions And to you to improving business, helpful. much and can to you're benefits then there? taken within the in you. that's of turning came Okay, margin

Jim Peters

our frankly, appliances all would I it's quarters the it's driving is kind markets. the say, business of like Keep domestic pretty several I takeout of South pretty And day, delivered drove core refocus the all cost levers. on the a the we of biggest for last three we mean of of exit which and measures. the I and combination actions of like and fixed in much Africa certain non-core Turkey, growth is mind, points think the at Susan, investments the balanced. and these these in end small

our core it's think markets it combination we and we embedded to unit these is ones, in which QX, number overall for drove improvements. year-over-year of when thing. and which I growth market So be in particular our in the the that's core comes had in this Europe, But a have may good

markets regain core in stabilized look we So the again encouraging a when that's market sign share into we of most very or XXXX. and

Susan Maklari

great. Thank you. Okay,

Jim Peters

Thanks, Susan.

Operator

Raymond Your James. next line comes the question from of Darkatsh with Sam

Your line is open.

Sam Darkatsh

Good you? How Jim. Good morning, morning, Marc. are

Marc Bitzer

Good morning. Good, Sam.

Sam Darkatsh

Couple of could. I questions, if

guessing First to expected dollars expectations X% figure for trying order, units out I'm could fiscal industry a that's for in win, but 'XX flat I'm price shipments. the of drivers flat D.R. mix, expectations. also some order you're sales that's growth outperformance sales industry I'm and reasons versus gap, organic the the rank you help globally some that of the if rank the Jim? of for guessing Horton in the you mentioning

Jim Peters

you of and world back to of talked within in do here's if EMEA start what think globally. some believe there. we North also you at about, specific just share the But Marc Sam, the share lost also, with being say have we I'd Yes, gain certain look around Obviously, America. on expect demand we as as some to we'll examples some we is, win pointed markets the it what would flat probably I

perspective So industry flat a that globally. drive being despite revenue help from an will us

a The base, also year. second on the positive we price there thing is there help an for of incremental mentioned, revenue be does as is, to assume us amount we which mix that in slightly

probably So be I biggest both would of second the say. those driver, would that that

Sam Darkatsh

where you'd than of question, you I having maybe you more mentioned being fiscal shipments from know second efficiencies productivity that's in production did it's at constructive still little ideally inventories that below to still net then but a cost And bit, like be down anticipating Are like I cut. standpoint. a XXXX 'XX. the basis sounded benefit XX but it production least obviously points think below in my

production about expectations versus could talk shipments, you if please? So

Jim Peters

that Sam. I take can

cost base, to increase all we're out, First planning out going not -- we're not we some not you planning we're forecast. takeout differently, volume from to opportunity. actually it the as have leverage inventory take point certainly net we're beyond sales benefit further contrary on put and We production or full have of year to

making mean would a in cost a that say However, the have -- element takeout negative is throughout and still still fixed I efforts, the our small the global and world elevated item the progress is, we're news but product it's is I The good that good other factor. cost huge still from some not there, parts. is, in on which some a cost benefit logistic we we takeout in Europe see other have are architecture. We

to coming So over internally all our the and logistic supply tackle job even materialize. is yes, to chain it's time costs. particularly more, And

Sam Darkatsh

long-term number as the basis opposed to that cost So XX be net what should points?

Jim Peters

-- I and what global we again Sam back investor it's would to said I come mean the conference. at

expectations takeout aspiration And raw a impact. kind have of should net business absent the our for material long cost yes, size. term be point X.X point Our be X that's to would the will of

Sam Darkatsh

you. Thank

Operator

Your next line Curtis the from question America. comes of Bank Nagle from of

is line Your open.

Curtis Nagle

very taking Thanks questions. my for morning. much Good

up late one will be and first is that higher or being haven't stage, from obviously the we a year things and view to cycle I demand commentary unit the like think replacement North So your a trying that. versus be would what understand push housing last, given America that this much driving of seen demand just

yes versus just year reconcile this I'm to last? think about again to trying how So

Marc Bitzer

North first -- minus of all, somewhere to America, repeat So again plus be we between me industry North to X% and X%. the America let Curtis, expect numbers,

much flat pretty year-over-year. So

As we which housing remodeling. industry demand is One to replacement they you by major somewhat simplified the is related in demand. know, basically have are or the components two

a and already that's And or years. against low and you're has two be the years And comping same comping year the little just bit the that's last around effect because so. years for these been around us now one post-recession [indiscernible] another XXXX. the we're probably or against in for last and year, On will replacements, like that low

and we're we a XXXX, 'XX Coming housing what QX not the back coming momentum sold more in I coming bit we of little time housing and into a out frankly, in the softer From what into again impacted expected a to -- housing weak XXXX. in rate expected model, we of course going housing of then XXXX. side market compared the would originally of say,

would still fact mean the we're housing, see. it's points first we say, points see to we I in but wait want were data reasonably encouraging. the which As stabilizing. want on and with optimistic you I got from is turn What positive in that the XXXX, But page, and very December data in that initial to housing we

remind I to would months. the very when to typically client is also from also you between add XX the you have homebuilders, order everybody signs. nine fact actual our in were news these I and want encouraging But look at an very shipments, strong, of new house

see signs now side, in our until a we line. it up while it the takes which good shows on order So revenue

but for industry say we've would in say seen trends that more that stabilizes housing if positive and news our us. I spells with would for So and seize I December.

Curtis Nagle

my down you think just restructuring I understand down guys we as I for, I then past how going one-time think of follow-up, how should we expect Okay, we be should we I what it's see caution should a guess, now kind And that guys think that The forward. about the kind years of mean, understood. for yes, commentary guess few from year still or call I it? do tick you but past I elevated this about item, XXXX going will and guess, to a ticked

Jim Peters

of this is be from cost within a expect Curtis, of restructuring already P&L around we taking year. Naples I'd what this to to $XXX we're the Jim. And perspective related million actions is Yes. that factory announced say our is And at EMEA. most

on but we've should those, including some charge rate already that's projects what the is ongoing or for outlays you about that but for really and of less than million also that is run Naples, do have assumed the you a of just basis have cash this that's those, somewhere within go-forward basis. that's $XXX about million million of What the we we less expect restructuring taken So $XXX that or is finalization see. that ongoing the year we P&L we'll should have, an think $XXX the on still

Marc Bitzer

first many echo Marc million down? back which is And Curtis I the $XXX So had in and that the million $XXX year XXXX where but and restructuring and coming And that of to see again stepping we time, and would say, years and, post me let to is trend $XXX we significant where to will be forward. did we I year significant is I now get also think Jim also million and it over the going million. a XXXX million rightfully first where $XXX when and acquisitions restructuring a saying. over several what would such reduction was the should say we significant basically time charges you following cash is point had you Jim's the post-recession it's $XXX asking be again down

Curtis Nagle

Thanks very much. Okay, understood.

Operator

of Longbow comes the from question line David Research. MacGregor with next Your

Your open. line is

David MacGregor

is related to looking favorable line and EBIT far an to Europe versus earlier just points. How quarter, as guide quarter like savings expected Yes, much to XXXX the so drivers on XXX always much that just improvement your good a listing full year on the top question basis delivered overall. XXX -- mix? related and is how good just is growth you've caller's morning. of to Congratulations a on go of at the your back I guess

Jim Peters

say, I'd well David. Yes,

$XX we so actions off a we to with we -- about really you rate of run If deliver that took million about start $XXX the basis million that on far. and said realized

next those actions already then we've takeout come entered we've additionally, about initiatives continuing continue there's got and that will that other we from cost within planned. there $XX And million year to So we've drive. into

that I ongoing have, margin markets mentioned, progression the it from time, We will within or it volume the what in see we some as terms while in perspective. really point the XXXX, significant market around earlier, the an be factory mentioned at that opportunity to I Naples close action then, in as is key of benefit some there. of share don't expect our gap some regaining lift a be the the is of to And we

David MacGregor

cut off segment just of a want ask the EMEA don't on how you on and question. elaborate the second EBIT I to But a answer was to could drag business? just just because I've you I the got much get if provided

Marc Bitzer

pretty David, business was throughout drag EMEA a the much QX.

As [indiscernible] but drag we much much some where had had a was should you where we we it but line against with know, QX industry pretty EMEA historically pretty standards, in September. be, it the certification new until and was in

a base. on So it's a year full-year drag little -- it was

would improvements I quarters. leverage yes, just that further lever the in operation word against for say a organic further now a XXXX So off is three you because comping

David MacGregor

North with of lot I question, market the And okay. follow-up a the I in my questions to then respect today. there's guess, Right, guess business. American

pretty negative Regarding American the impressive margins. call North the revenues you've got on that were flat October put capital units, certainly discussed yet below you some working was and up generally the you guide

of comps. had and pretty a we growth XXXX. stretch we revenue is guess right of just four-year got through how a maybe I the math, And the mix lot three, in you've strong the innovation, year of driven by matter to a can confident remain P&L? Are within will that in you very a strong just I then mix the and end you talk mix good against So -- market It's guess are the contribution mix strong two, tough mix a the up how some beginning in now. about innovation we

Marc Bitzer

I'm -- I overall, So David, QX. say, in would

and yes, it it's mix around was our promotional by, -- of I two second point, where America. the product continued all, started and driven both established product our First driven ones also emphasize major pricing product why impacting we that's of to We're leveraging your we in innovation but policy with participation. started earlier some line -- they're of kind the of creating discipline value because script our in reason all, North showed was the the new

big have will solid we also and So is -- across brands, go-forward a and we're mix that on mix opportunity. product across good why confident our that's basis

David MacGregor

Thanks very much.

Operator

question with Deutsche Seldon of Your from line the comes next Clarke Bank.

is line Your open.

Seldon Clarke

the Hey, thanks question. for

long-term right Just you pieces about free do cash given to moving free conversion think cash flow, to EBITDA way all what think the is? in the

Jim Peters

X% X% we always we've said, to around flow as goal our of long-term free Well, the see cash sales.

to one-time conversion to as that think have that but once we X% in free as items mentioned, to area. X% do of to at So to still that, begin flow be need percentage. as look things, begins plus into settlements I such exit that we I to beyond this we again, you we do get a a XX% start we sales cash other as get think some legal And you expect and the year, key XXXX, some

Seldon Clarke

right. All starting think that's in you XXXX? And --

Jim Peters

mentioned -- few closer In we're going most progression or you us. some over whether a we get XXXX. years. it our the to product to less XXXX I'd be get had of legal of next as that to of we go But items outflows these will be will -- we'll actions coming take out say these have will cash their we and through much behind as they're settlements restructuring and

feel do flows free reflect we to that begin that so And our performance. stronger confident cash will

Seldon Clarke

be I helpful. of to production outbreak, major specifically in to the then whether but the broadly? from your it'd Corona And industry That's majority this virus manufacture impacts just Whirlpool anticipate related you do you appliances or stemming any more the know U.S.,

Marc Bitzer

at Seldon, is impact. we say it's the point, I would a answer expect no, major Marc. this don't

and -- biggest our like first So going our this looks to labor around healthy. and but people all, far, now of on bit our and it's all so is is safe it little people a concern right XX,XXX are one,

people exposure from into can will know -- it when what to potential you the this impact. that markets, this of is domestic all see have Beyond Corona our obviously, limited. is today, domestic decline, go three market the don't stores, is you may in virus China market One one China

So I a whole guess us to lot. hurt that's not going

largely extent small production is America. extent North on very the has to serving almost production on lesser China and Production, a and Two and components. Europe Asia three to only is been

know, you As North North in America is XX% produced in America of U.S. U.S. sell what or we

limited exposure we that away somewhat factor in Wuhan. XXXX miles where from one Chinese, almost export from with So it's particular

say, bit So we a protected but would further bit, away. it's little I are a

The this your production. New Chinese Chinese mind, happens year around whole stop in we supplier production, inventory third the we if when thing element is on start New plan Year. components, keep Year, levels when Every you

So, I Year, we're say, to of days for see or these New this we extension it. four pretty and would well beyond covered, for well covered got one, Chinese three

most we throughout couple last aggressively need years sourcing. The mind, components went also keep to for dual other of in the you thing which critical in

So in source we're a We're components. not and you gives only which very hedging. -- we're few single source dual bit very, largely of little a

Seldon Clarke

questions. that's I appreciate Okay, the helpful.

Marc Bitzer

Seldon. Thanks,

Operator

next question of Your from the Eric line Cleveland Research. Bosshard with comes

open. is line Your

Eric Bosshard

Good be things about. U.S. morning. market Two in curious the

your in expectation it last you're how growth? and business Sears major slower looks it launches new performance some First growth you a got retailers of key all, think appears year where be giving also your funding like to looks about you've plants curious up secondly, market their their of then how and And product an environment has seeing managing interested somewhat share, share 'XX. what sustained environment in probably

Marc Bitzer

Yes.

Marc. mean, outlook. I it's as Eric, our in you've So seen

products do we lot a believe Dishwasher have on innovations which new and almost some two growth Certainly we have which product just we where platform on years we dishwasher. America, we've top-load North the opportunities. XX share have architect of for So shown old.

for next bringing promotional such great share healthy about talking share I'm not in about business. structural growth growth, should in with So share I architecture opportunities some growth, features and an I'm talking such a mean open

we say, a in has have the retailers question other came now, of being reasonably growth diminished. stable other some yes, well yes, of existing. home retailers, But strong Sears share of I North ambition America. certain for your players. that on in by retail windfall mean, about which would improvement for Related having that kind established, out also home but it's growth obvious So to best decline environment that's a many appliances regional good it's right based very I

-- there retail us We've and dramatic then management and but that retailers. So the inventory see in subsequent retailers. right don't of all entire I outs it's in data October moves our some don't shipment moves in so I has ins chain, December, to we seen think AM some and think landscape. comes moves see of seen dramatic when you now, been across course this have it one, the we And across the supply the different impacts beyond which

Eric Bosshard

All you. right. Thank

Operator

Your Ken the next question KeyBanc. from comes of line Zener with

open. is Your line

Ken Zener

everybody. morning, Good

question. have quick I -- just a So

meaning the are expansion little normal guys basically earnings should kind mix guidance kind look of quarter you front of expect So EPS XX% cadence half the XX%, half given first a that EPS your range. under giving margins in that we a

shifting and we're thinking strength want the I given just sure the parts. this about to year? Just balance if make moving kind you're of different business is

Jim Peters

Yes, Ken.

is and you pretty think should but other of we historically, if seasonality within what a XX-XX first be expect still I is you've close we mean the similar split quarter, in to seen year years this XX% in at look that a type similar even safe to I tend assumption.

Ken Zener

given Okay. wondering absent you're mix How I away understand. that [ph] price history dialog can mean And you'll not if reporting hear from there, all understand to none or discussion, kind I moving that then talk or in given interpret properly North we volume so to and you in the do AHAM America the I'm of long about is volume to anticipate, I able by revenue explaining guys of expect from type better how terms I if the able this if so points price mix. we you're what of get could kind those results it just going caught I be of are are data you us you down, If mean -- worse of be just go the -- will to us about might it. though the change? surprise think you result to even communication you mean

Marc Bitzer

would I expect. Ken, Well,

there'll play going really now be direction which data Currency North First key indication an U.S. America out will biggest obviously a thing it's big give of industry industry perspective from that one still the is a is being there. the within two markets and difference the that also there doesn't

price are within make will not the because ready talk units Obviously, don't drive or said, mix we'll whether indicator how significant talk a disclose revenues basis that unit an about also think variables and then there. So and about we America that performance perspective the continue we North on and we is from the difference big which of are is business benefits out doing. a believe of a we're share what doing versus to what that I that couple as I will go-forward

Ken Zener

in we're this looking that about the just you kind is this think challenging sustained seeing the some to architecture market guess are Kitchen really X. you of terms and Fridge that I had these to I the was fixed be about for that to say really How of laundry I at because Whirlpool year, growth? for then leverage or categories it's laundry mentioned you growth from to right. categories relative kind seems does was what given think global kind to do important factor cost your And that points in a that you in of interesting AHAM the to down global environment mean of X platform a Okay. of X up challenge Marc extract X

Jim Peters

Yes.

basis, be honest, in we differences I of go-forward product we don't would the groups mean a dramatic developments. across the on see where terms see growth Ken, industry different to So or

at is, translates bigger the suite. to what strengthening least housing I housing indication there of Given said may kind in met it's before, strengthen, Kitchen early at

that the too dishwasher, refrigeration I would not cooking, read the but get So much business, help one. should this into

too if wouldn't guidance think for pretty pieces for very in is I sub-categories. read develops different So our frankly, right the number, trend we a the flat I don't but extending would December again, upside housing the but see uncertain I if say, growth much break much, and down factor year the into be the housing too could next stabilize industry the now, beyond much at

Ken Zener

interviews yesterday. Thank you, I your and enjoyed

Marc Bitzer

Ken. it, Appreciate Okay.

joining let me let and the just summarize. of just all first up us for you thank question, last that we all, wrap came and me to given So quickly

more good I numbers I last an out about with record to feel is we very of help Industry everybody, part all We year us. year. the had which of did year. with still it First we best out. demand cost start a didn't all-time want an in year quarter in that have to given throughout ever I tailwind closed the year. and most the all, the for history, remarkable our We not record inflation lot of all-time want and think remind we saw

so hope January call. So we year XXXX XXXX, a achieved you it year, we as momentum care feel thing earnings year, now but exited very us good we've we about last which into momentum last throughout important very about most what that good is the I good heard the gave all we feel confidence about that

and we XXXX we focused launches there on the cost into key and look we a very key in we about priorities, highlighted. months we That to lot in on getting perspective, laid the from obviously -- that have operational beyond As clear executing around which which continue particular of more America two both course, North And a we only margin maintaining is Europe strong turning is and system, we focused focus. focus launches out, a have China. product are we not talked turn of are the out the regional

But to a then back comes Day, perspective and Investor in remind changed. strategy this broader to our everybody, our has want not I

imperative strategic only journey. our on execute which Beyond winning delivering priorities our it continuing the product digital on digital be have our be is, to redefining not entire a the product commitments, we transformation consumer and leadership it operational on on what very focus strong it's about but along is

our are in and increase good of transformation company long-term about focus strategic kind of and our create year a we where very strong business. we feel to kind the strong will sustainable we a throughout around and the is there So efforts

to us in joining mind, want you thank you to talk just for that With I today quarter. and next

Operator

concludes today's conference call. This

disconnect. may now You

Whirlpool (WHR) 28 Jan 202019 Q4 Earnings call transcript