# Whirlpool Corp: Form 10-Q for the period ended Jun 30, 2024

- Company: [Whirlpool Corp](/companies/whr.md) (CIK 106640)
- Form: 10-Q
- Filed: 2024-07-25
- Accepted by EDGAR: Jul 25, 2024, 10:02 ET
- Period: 2024-06-30
- Accession: 0000106640-24-000125
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/106640/000010664024000125/whr-20240630.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/106640/000010664024000125/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2024-04-01 to 2024-06-30 | $3.99bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 6 months, 2024-01-01 to 2024-06-30 | $8.48bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2024-04-01 to 2024-06-30 | $3.36bn | us-gaap:CostOfGoodsAndServicesSold |
| Cost of revenue | 6 months, 2024-01-01 to 2024-06-30 | $7.21bn | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2024-04-01 to 2024-06-30 | $626.0m | us-gaap:GrossProfit |
| Gross profit | 6 months, 2024-01-01 to 2024-06-30 | $1.27bn | us-gaap:GrossProfit |
| Selling, general and administrative | 3 months, 2024-04-01 to 2024-06-30 | $394.0m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Selling, general and administrative | 6 months, 2024-01-01 to 2024-06-30 | $871.0m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Operating income | 3 months, 2024-04-01 to 2024-06-30 | $130.0m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2024-01-01 to 2024-06-30 | $14.0m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2024-04-01 to 2024-06-30 | $93.0m | us-gaap:InterestExpenseNonoperating |
| Interest expense | 6 months, 2024-01-01 to 2024-06-30 | $183.0m | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2024-04-01 to 2024-06-30 | −$206.0m | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2024-01-01 to 2024-06-30 | −$130.0m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2024-04-01 to 2024-06-30 | $219.0m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2024-01-01 to 2024-06-30 | −$40.0m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-04-01 to 2024-06-30 | $3.96 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2024-01-01 to 2024-06-30 | −$0.75 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-04-01 to 2024-06-30 | $3.96 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2024-01-01 to 2024-06-30 | −$0.75 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-04-01 to 2024-06-30 | 55,000,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2024-01-01 to 2024-06-30 | 54,900,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2024-01-01 to 2024-06-30 | −$485.0m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2024-01-01 to 2024-06-30 | $228.0m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 6 months, 2024-01-01 to 2024-06-30 | $191.0m | us-gaap:PaymentsOfDividends |
| Share repurchases | 6 months, 2024-01-01 to 2024-06-30 | $50.0m | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2024-06-30 | $1.18bn | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2024-06-30 | $5.86bn | us-gaap:AssetsCurrent |
| Total assets | at 2024-06-30 | $17.34bn | us-gaap:Assets |
| Current liabilities | at 2024-06-30 | $6.13bn | us-gaap:LiabilitiesCurrent |
| Long-term debt | at 2024-06-30 | $6.31bn | us-gaap:LongTermDebtNoncurrent |
| Current portion of debt | at 2024-06-30 | $350.0m | us-gaap:LongTermDebtCurrent |
| Short-term borrowings | at 2024-06-30 | $778.0m | us-gaap:ShortTermBorrowings |
| Shareholders' equity | at 2024-06-30 | $3.10bn | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 40,523 characters.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to promote understanding of the results of operations and financial condition of the Company and generally discusses the results of operations for the current three and six months ended periods compared to the same prior-year periods. MD&A is provided as a supplement to, and should be read in connection with, the Consolidated Condensed Financial Statements and Notes to the Consolidated Condensed Financial Statements included in this Form 10-Q.

Certain references to particular information in the Notes to the Consolidated Condensed Financial Statements are made to assist readers.

### ABOUT WHIRLPOOL

Whirlpool Corporation ("Whirlpool") is a leading kitchen and laundry appliance company, in constant pursuit of improving life at home and inspiring generations with our brands. The company is driving meaningful innovation to meet the evolving needs of consumers through its iconic brand portfolio, including *Whirlpool, KitchenAid, JennAir, Maytag, Amana, Brastemp, Consul*, and *InSinkErato*r. In 2023, the Company reported approximately $19 billion in annual sales, 59,000 employees, and 55 manufacturing and technology research centers. Beginning January 1, 2024, we are conducting our business through five operating segments, which consist of Major Domestic Appliances ("MDA") North America; MDA Europe (deconsolidated as of April 1, 2024), MDA Latin America; MDA Asia; and Small Domestic Appliances ("SDA") Global.

### OVERVIEW

Whirlpool delivered second-quarter GAAP net earnings (loss) available to Whirlpool of $219 million (net earnings margin of 5.5%), or $3.96 per share, compared to GAAP net earnings (loss) available to Whirlpool of $85 million (net earnings margin of 1.8%), or $1.55 per share in the same prior-year period. Whirlpool delivered cash provided by (used in) operating activities of $(485) million for the six months ended June 30, 2024, compared to $(370) million in the same prior year period and free cash flow (non-GAAP) of $(713) million, compared to free cash flow of $(587) million in the same prior year period.

Whirlpool delivered second-quarter ongoing (non-GAAP) earnings per share of $2.39 and ongoing EBIT margin of 5.3%, compared to $4.21 and 7.3% in the same prior-year period.

On a GAAP basis, net earnings margins were impacted by adjustments recorded in the loss on sale and disposal of businesses (see Note 14 for further information) and restructuring expenses related to organizational simplification. On a GAAP and ongoing basis, quarterly results were impacted by negative price/mix, partially offset by cost takeout actions. On a GAAP basis, net earnings were also impacted by lower income tax expense, primarily due to an overall lower level of earnings and tax benefits related to the completion of legal entity restructuring projects in connection with the disposal of our European major appliance business, partially offset by associated valuation allowances.

We continue to take actions to deliver shareholder value as we navigate through a challenging macro environment in North America, demonstrated by the completion of our global organizational simplification and MDA North America promotional program price increase actions. We remain confident in delivering $300-$400 million of cost take out and continued sequential margin progression through 2024.

For additional information regarding non-GAAP financial measures, see the Non-GAAP Financial Measures section of this Management's Discussion and Analysis.

### RESULTS OF OPERATIONS

The following table summarizes the consolidated results of operations for the periods presented:

*Consolidated - Millions of dollars, except per share data*

|  | Three Months Ended June 30, 2024 | 2023 | Better/(Worse) % | Six Months Ended June 30, 2024 | 2023 | Better/(Worse) % |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| **Net sales** | **$3,989** | $4,792 | (16.8)% | **$8,478** | $9,441 | (10.2)% |
| Gross margin | **626** | 816 | (23.3) | **1,267** | 1,579 | (19.8) |
| Selling, general and administrative | **394** | 476 | 17.2 | **871** | 963 | 9.6 |
| Restructuring costs | **50** | 9 | (455.6) | **73** | 9 | (711.1) |
| Loss (gain) on sale and disposal of businesses | **45** | 18 | 150.0 | **292** | 240 | 21.7 |
| Interest and sundry (income) expense | **7** | 10 | 30.0 | **(21)** | 87 | nm |
| Interest expense | **93** | 89 | (4.5) | **183** | 164 | (11.6) |
| Income tax expense (benefit) | **(206)** | 114 | nm | **(130)** | 182 | nm |
| Net earnings (loss) available to Whirlpool | **$219** | $85 | 157.6 | **$(40)** | $(94) | 57.4 |
| Diluted net earnings (loss) available to Whirlpool per share (2) | **$3.96** | $1.55 | 155.5% | **$(0.75)** | $(1.71) | 56.1% |

(1) Not meaningful ("nm")

(2) As a result of the GAAP earnings loss for the six months ended June 30, 2023, and June 30, 2024, respectively, the impact of antidilutive shares was excluded from the loss per share calculation on a GAAP basis.

Consolidated net sales decreased 16.8% and 10.2% for the three and six months ended June 30, 2024 compared to the same periods in 2023. The decrease for the three and six months ended June 30, 2024 was primarily driven by divestiture of our European major domestic appliances business. Excluding the impact of foreign currency, net sales decreased 16.0% and 10.3% for the three and six months ended June 30, 2024, compared to the same periods in 2023.

The consolidated gross margin percentage for the three and six months ended June 30, 2024 decreased to 15.7% and 14.9% compared to 17.0% and 16.7% in the same prior-year periods. The decrease was primarily driven by volume and unfavorable product price/mix, partially offset by cost productivity.

Beginning January 1, 2024, we are conducting our business through five operating segments, which consist of MDA North America; MDA Europe (deconsolidated as of April 1, 2024); MDA Latin America; MDA Asia; and SDA Global. The chief operating decision maker evaluates performance based on each segment's earnings (loss) before interest and taxes (EBIT), which we define as operating profit less interest and sundry (income) expense and excluding restructuring costs, asset impairment charges and certain other items that management believes are not indicative of the region's ongoing performance, if any. For additional information, see Note 13 to the Consolidated Condensed Financial Statements.

The following is a discussion of results for each of our operating segments. Each of our operating segments have been impacted by some disruptions in supply chains and distribution channels, among other macroeconomic impacts.

### MDA NORTH AMERICA

### Net Sales

Net sales decreased 5.7% and 6.9% for the three and six months ended June 30, 2024 compared to the same periods in 2023. The decrease was primarily driven by unfavorable impacts of product price/mix. Excluding the impact from foreign currency, net sales decreased 5.6% and 6.8% for the three and six months ended June 30, 2024, compared to the same periods in 2023.

### EBIT

EBIT decreased for the three and six months ended June 30, 2024 compared to the same periods in 2023. The decrease for the three and six months ended was primarily due to unfavorable product price/mix. EBIT margin was 6.3% and 6.0% for the three and six months ended June 30, 2024, compared to 10.1% and 10.1% for the same periods in 2023.

### MDA LATIN AMERICA

### Net Sales

Net sales increased 11.3% and 11.7% for the three and six months ended June 30, 2024, compared to the same periods in 2023. The increase was primarily driven by increased volume, partially offset by the unfavorable impacts of foreign currency and product price/mix. Excluding the impact from foreign currency, net sales increased 14.8% and 11.8% for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023.

### EBIT

EBIT increased for the three and six months ended months ended June 30, 2024 compared to the same periods in 2023. The increase for the three and six months ended was primarily driven by increased volume, partially offset by unfavorable product price/mix. EBIT margin was 5.8% and 6.7% for the three and six months ended June 30, 2024, compared to 6.1% and 5.5% for the same periods in 2023.

### MDA ASIA

### Net Sales

Net sales increased 19.7% and 9.5% for the three and six months ended June 30, 2024 compared to the same periods in 2023. The increase was primarily driven by increased volume, partially offset by the impact of foreign currency. Excluding the impact from foreign currency, net sales increased 21.5% and 10.7% for the three and six months ended June 30, 2024 compared to the same periods in 2023.

### EBIT

EBIT increased for the three and six months ended June 30, 2024 compared to the same periods in 2023. The increase was primarily driven by increased volume and cost take out actions, partially offset by unfavorable product price/mix. EBIT margin was 6.2% and 5.4% for the three and six months ended June 30, 2024 compared to 3.5% and 3.2% for the same periods in 2023.

### SDA GLOBAL

### Net Sales

Net sales increased 11.3% and 9.2% for the three and six months ended June 30, 2024 compared to the same periods in 2023. The increase was primarily driven by increased volumes, partially offset by unfavorable impacts of product price/mix. Excluding the impact from foreign currency, net sales increased 11.8% and 9.1% for the three and six months ended June 30, 2024 compared to the same periods in 2023.

### EBIT

EBIT increased for the three and six months ended June 30, 2024 compared to the same periods in 2023. The increase was driven by increased volume, partially offset by unfavorable product price/mix and increased marketing spend. EBIT margin was 13.9% and 16.3% for the three and six months ended June 30, 2024 compared to 12.5% and 11.5% for the same periods in 2023.

### MDA EUROPE

### Net Sales and EBIT

MDA Europe consisted of our European major domestic appliance business which was contributed to Arcelik as of April 1, 2024. Therefore, the Company had no net sales or EBIT for MDA Europe during the second quarter of 2024. For additional information on the financial performance of MDA Europe for the three months ended March 31, 2024, see our Form 10-Q for the quarter then ended.

### Selling, General and Administrative

The following table summarizes selling, general and administrative expenses as a percentage of net sales by region for the periods presented:

| Millions of dollars | Three Months Ended June 30, 2024 | As a % of Net Sales | 2023 (1) | As a % of Net Sales | Six Months Ended June 30, 2024 | As a % of Net Sales | 2023(1) | As a % of Net Sales |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| MDA North America | **$195** | **7.6%** | $218 | 8.0% | **$382** | **7.6%** | $410 | 7.6% |
| MDA Latin America | **80** | **8.9** | 73 | 9.1 | **153** | **8.8** | 151 | 9.7 |
| MDA Asia | **30** | **8.8** | 26 | 9.2 | **55** | **9.5** | 53 | 10.0 |
| MDA Europe | **—** | **nm** | 80 | 9.8 | **90** | **11.2** | 159 | 9.6 |
| SDA Global | **52** | **27.8** | 44 | 26.2 | **89** | **24.1** | 87 | 25.7 |
| Corporate/other | **37** | **—** | 35 | — | **102** | **—** | 103 | — |
| Consolidated | **$394** | **9.9%** | $476 | 9.9% | **$871** | **10.3%** | $963 | 10.2% |

(1) Effective January 1st, 2024, we reorganized our operating segment structure. All prior period amounts have been reclassified to conform with current period presentation. For additional information, see Note 13 to the Consolidated Condensed Financial Statements.

(2) Not meaningful ("nm")

Consolidated selling, general and administrative expenses decreased for the three and six months ended June 30, 2024, compared to the same periods in 2023 primarily due to the disposal of our European major domestic appliance business on April 1, 2024.

For additional information, see Notes 1 and 14 to the Consolidated Condensed Financial Statements.

### Restructuring

We incurred restructuring charges of $50 million and $73 million for the three and six months ended June 30, 2024 compared to $9 million and $9 million for the same periods in 2023. For additional information, see Note 11 to the Consolidated Condensed Financial Statements.

For the full year 2024, we expect to incur approximately $75-80 million of restructuring charges, inclusive of the $73 million recorded for the six months ended June 30, 2024. Substantially all will result in cash settlement.

### (Gain) Loss on Sale and Disposal of Businesses

The European disposal group was deconsolidated as of April 1, 2024. We recorded an adjustment of $45 million and $247 million, respectively, for the three and six months ended June 30, 2024, resulting in a total loss of $1.9 billion for the transaction. These adjustments are recorded in the loss on sale and disposal of businesses and reflect the reassessment of the fair value less costs to sell of the disposal group, transaction costs and provision for tax related indemnities recorded at closing of the transaction.

We recorded an adjustment of $18 million and $240 million, respectively, for the three and six months ended June 30, 2023 which reflected the reassessment of the fair value less costs to sell, primarily driven by fluctuations of net working capital, of the disposal group and transaction costs.

For additional information, see Note 14 to the Consolidated Condensed Financial Statements.

### Interest and Sundry (Income) Expense

Net interest and sundry expense decreased for the three and six months ended June 30, 2024 compared to the same prior year periods in 2023. The decrease for the six months ended is primarily due to reserves for legacy EMEA legal matters recorded in the prior year.

### Interest Expense

Interest expense was $93 million and $183 million for the three and six months ended June 30, 2024 compared to $89 million and $164 million in the same prior year periods of 2023. The increase is primarily due to higher interest rates.

### Income Taxes

Income tax benefit was $(206) million and $(130) million for the three and six months ended June 30, 2024 compared to income tax expense of $114 million and $182 million in the same prior year periods of 2023. The decrease for the three months ended June 30, 2024 is primarily due to an overall lower level of earnings and tax benefits related to the completion of legal entity restructuring projects in connection with the disposal of our European major appliance business, partially offset by associated valuation allowances. For more information, see Note 12 to the Consolidated Condensed Financial Statements.

### Other Information

Our Critical Accounting Policies and Estimates for goodwill and other indefinite-lived intangibles are disclosed in Note 1 to the Consolidated Financial Statements and in Management's Discussion and Analysis of our annual report on Form 10-K for the fiscal year ended December 31, 2023.

We continue to monitor the significant global economic uncertainty to assess the outlook for demand for our products and the impact on our business and our overall financial performance. Our *Maytag* and *InSinkErator* trademarks continue to be at risk at June 30, 2024. None of our reporting units or other indefinite-lived intangible assets are presently at risk for future impairment.

For additional information, see Note 1 to the Consolidated Condensed Financial Statements.

### FINANCIAL CONDITION AND LIQUIDITY

#### Background

Our objective is to finance our business through operating cash flow and the appropriate mix of long-term and short-term debt. By diversifying the maturity structure, we avoid concentrations of debt, reducing liquidity risk. We have varying needs for short-term working capital financing as a result of the nature of our business. We regularly review our capital structure and liquidity priorities, which include funding innovation and growth through capital expenditures and research and development expenditures as well as opportunistic mergers and acquisitions; and providing returns to shareholders through dividends, share repurchases and maintaining our strong investment grade rating.

The Company believes that free cash flow provides stockholders with a relevant measure of liquidity and a useful basis for assessing Whirlpool's ability to fund its activities and obligations. Whirlpool has historically been able to leverage its strong free cash flow generation to fund our operations, pay for any debt servicing costs and allocate capital for reinvestment in our business, funding share repurchases and dividend payments.

On February 20, 2024, Whirlpool’s wholly-owned subsidiary, Whirlpool Mauritius Limited, executed the sale of 30.4 million equity shares of Whirlpool India via an on-market trade. The transaction reduced Whirlpool’s ownership in Whirlpool India from 75% to 51%, and generated sales proceeds of approximately $462 million on settlement. The Company used transaction proceeds to reduce debt.

Our short-term potential uses of liquidity include funding our business operations, ongoing capital spending, debt repayment, and returns to shareholders. As of June 30, 2024, we had $350 million of debt maturing within the next twelve months, which we expect to pay through refinancing, free cash flow generation, cash on hand, or a combination thereof.

We monitor the credit ratings and market indicators of credit risk of our lending, depository, derivative counterparty banks, and customers regularly, and take certain actions to manage credit risk. We diversify our deposits and investments in short-term cash equivalents to limit the concentration of exposure by counterparty.

#### Cash and cash equivalents

The Company had cash and cash equivalents of approximately $1.2 billion at June 30, 2024. For cash in each of its foreign subsidiaries, the Company makes an assertion regarding the amount of earnings intended for permanent reinvestment, with the balance available to be repatriated to the United States. The cash held by foreign subsidiaries for permanent reinvestment is generally used to finance the subsidiaries' operational activities and expected future foreign investments. Our intent is to permanently reinvest these funds outside of the United States and our current plans do not demonstrate a need to repatriate the cash to fund our U.S. operations. However, if these funds were repatriated, we would be required to accrue and pay applicable United States taxes (if any) and withholding taxes payable to various countries. It is not practicable to estimate the amount of the deferred tax liability associated with the repatriation of cash due to the complexity of its hypothetical calculation.

At June 30, 2024, we had cash or cash equivalents greater than 1% of our consolidated assets in Brazil (2.4%) and India (1.9%). In addition, we had third-party accounts receivable outside of the United States greater than 1% of our consolidated assets in Brazil, which represented 2.3%. We continue to monitor general financial instability and uncertainty globally.

#### Revolving credit facility and other committed credit facilities

The Company maintains a $3.5 billion revolving credit facility and a committed $1.5 billion term loan as of June 30, 2024. In addition to these facilities, we have committed credit facilities in Brazil and India that provide borrowings up to approximately $192 million at June 30, 2024.

We were in compliance with our interest coverage ratio under the revolving credit facility and term loan as of June 30, 2024. For additional information, see Note 5 to the Consolidated Condensed Financial Statements.

#### Notes payable

Notes payable consists of short-term borrowings payable to banks and commercial paper, which are generally used to fund working capital requirements. At June 30, 2024, we have $778 million of notes payable outstanding primarily under the revolving credit facility or commercial paper programs. For additional information, see Note 5 to the Consolidated Condensed Financial Statements.

#### Trade customers

We continue to review customer conditions globally. We had no material impacts from customer insolvencies during the three months ended June 30, 2024, nor do we have immediate visibility into material customer insolvency situations occurring in the future. We continue to monitor these situations, considering each geographic region, the unique credit risk specific to the country, marketplace and economic environment, and take appropriate risk mitigation steps.

For additional information on guarantees, see Note 6 to the Consolidated Condensed Financial Statements.

### Share Repurchase Program

For additional information about our share repurchase program, see Note 10 to the Consolidated Condensed Financial Statements.

### Sources and Uses of Cash

The following table summarizes the net increase (decrease) in cash and cash equivalents for the periods presented:

| Millions of dollars Cash provided by (used in): | Six Months Ended June 30, 2024 | 2023 |
| --- | ---: | ---: |
| Operating activities | **$(485)** | $(370) |
| Investing activities | **(432)** | (222) |
| Financing activities | **501** | (110) |
| Effect of exchange rate changes | **(72)** | 55 |
| Less: (decrease) increase in cash classified as held for sale | **—** | (2) |
| Net change in cash and cash equivalents | **$(488)** | $(649) |

### Cash Flows from Operating Activities

Cash used in operating activities increased during the six months ended June 30, 2024 compared to the same prior year period in 2023. The increase in cash used in operating activities was primarily driven by fluctuations in working capital due to lower inventory from reduced sales volumes, along with increases in accrued expenses and deferred taxes due to the deconsolidation of MDA Europe business.

The timing of cash flows from operations varies significantly throughout the year primarily due to changes in production levels, sales patterns, promotional programs, funding requirements, credit management, as well as receivable and payment terms. Depending on the timing of cash flows, the location of cash balances, as well as the liquidity requirements of each country, external sources of funding are used to support working capital requirements.

### Cash Flows from Investing Activities

Cash used in investing activities during the six months ended June 30, 2024 increased compared to the same period in 2023 primarily due to a decrease of $245 million due to divestitures, representing cash and cash equivalents held in MDA Europe.

### Cash Flows from Financing Activities

Cash provided by financing activities during the six months ended June 30, 2024 increased compared to the same period in 2023 primarily due to increased short-term borrowings and the sale of minority interest shares in Whirlpool India.

### Financing Arrangements

The Company had total committed credit facilities of approximately $5.2 billion at June 30, 2024. These facilities are geographically reflective of the Company's global operations. The Company is confident that the committed credit facilities are sufficient to support its global operations. We had $1.5 billion and $2.0 billion drawn on the committed credit facilities (representing amounts drawn on the term loan) at June 30, 2024 and December 31, 2023, respectively, which were used to fund the InSinkErator acquisition in the fourth quarter of 2022.

For additional information about our financing arrangements, see Note 5 to the Consolidated Condensed Financial Statements.

### Dividends

On April 15, 2024, our Board of Directors approved a quarterly dividend on our common stock of $1.75 per share.

### Off-Balance Sheet Arrangements

In the ordinary course of business, we enter into agreements with financial institutions to issue bank guarantees, letters of credit, and surety bonds. These agreements are primarily associated with unresolved tax matters in Brazil, as is customary under local regulations, and other governmental obligations and debt agreements. At June 30, 2024, we had approximately $361 million outstanding under these agreements.

For additional information about our off-balance sheet arrangements, see Notes 5 and 6 to the Consolidated Condensed Financial Statements.

### NON-GAAP FINANCIAL MEASURES

We supplement the reporting of our financial information determined under U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial measures, some of which we refer to as "ongoing" measures, including:

- Earnings before interest and taxes (EBIT)
- EBIT margin
- Ongoing EBIT
- Ongoing earnings per diluted share
- Ongoing EBIT margin
- Sales excluding foreign currency
- Free cash flow
- Net debt leverage

Ongoing measures, including ongoing earnings per diluted share and ongoing EBIT, exclude items that may not be indicative of, or are unrelated to, results from our ongoing operations and provide a better baseline for analyzing trends in our underlying businesses. EBIT margin is calculated by dividing EBIT by net sales. Ongoing EBIT margin is calculated by dividing ongoing EBIT by net sales. Sales excluding foreign currency is calculated by translating the current period net sales, in functional currency, to U.S. dollars using the prior-year period's exchange rate compared to the prior-year period net sales. Management believes that sales excluding foreign currency provides stockholders with a clearer basis to assess our results over time, excluding the impact of exchange rate fluctuations. Management believes that Net Debt Leverage (Net Debt/Ongoing EBITDA) provides stockholders with a clearer basis to assess the Company's ability to pay off its incurred debt. We also disclose segment EBIT, which we define as operating profit less interest and sundry (income) expense and excluding restructuring costs, asset impairment charges and certain other items, if any, that management believes are not indicative of the region's ongoing performance, as the financial metric used by the Company's Chief Operating Decision Maker to evaluate performance and allocate resources in accordance with ASC 280, *Segment Reporting.*

Management believes that free cash flow provides stockholders with a relevant measure of liquidity and a useful basis for assessing Whirlpool's ability to fund its activities and obligations. The Company provides free cash flow related metrics, such as free cash flow as a percentage of net sales, as long-term management goals, not an element of its annual financial guidance, and as such does not provide a reconciliation of free cash flow to cash provided by (used in) operating activities, the most directly comparable GAAP measure, for these long-term goal metrics. Any such reconciliation would rely on market factors and certain other conditions and assumptions that are outside of the Company's control. Whirlpool does not provide a non-GAAP reconciliation for its other forward-looking long-term value creation and other goals, such as organic net sales, EBIT, and Net debt/Ongoing EBITDA, as such reconciliation would rely on market factors and certain other conditions and assumptions that are outside of the company’s control.

We believe that these non-GAAP measures provide meaningful information to assist investors and stockholders in understanding our financial results and assessing our prospects for future performance, and reflect an additional way of viewing aspects of our operations that, when viewed with our GAAP financial measures, provide a more complete understanding of our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. These non-GAAP financial measures should not be considered in isolation or as a substitute for reported net earnings (loss) available to Whirlpool, net sales, net earnings (loss) as a percentage of net sales (net earnings margin), net earnings (loss) per diluted share and cash provided by (used in) operating activities, the most directly comparable GAAP financial measures. We strongly encourage investors and stockholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Please refer to a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures below.

| Ongoing Earnings Before Interest & Taxes (EBIT) Reconciliation: in millions 2024 | Three Months Ended June 30, 2023 |  |
| --- | ---: | ---: |
| Net earnings (loss) available to Whirlpool (1) | **$219** | $85 |
| Net earnings (loss) available to noncontrolling interests | **6** | 2 |
| Income tax expense (benefit) | **(206)** | 114 |
| Interest expense | **93** | 89 |
| Earnings (loss) before interest & taxes | **$112** | $290 |
| Restructuring expense (a) | **50** | — |
| Impact of M&A transactions (b) | **50** | 26 |
| Legacy MDA Europe legal matters (c) | **—** | 36 |
| Ongoing EBIT (2) | **$212** | $352 |

(1) Net earnings (loss) margin is approximately 5.5% and (0.5)% for the three and six months ended June 30, 2024 compared to 1.8% and (1.0)% in the same prior year periods. Net earnings margin is calculated by dividing net earnings (loss) available to Whirlpool by consolidated net sales for the three and six months ended June 30, 2024 and June 30, 2023, respectively.

(2) Ongoing EBIT margin is approximately 5.3% and 4.8% for the three and six months ended June 30, 2024 compared to 7.3% and 6.4% in the same prior year periods. Ongoing EBIT margin is calculated by dividing Ongoing EBIT by consolidated net sales for the three and six months ended ended June 30, 2024 and June 30, 2023, respectively.

| Ongoing Earnings Per Diluted Share Reconciliation 2024 | Three Months Ended June 30, 2023 |  |
| --- | ---: | ---: |
| Earnings (loss) per diluted share | **$3.96** | $1.55 |
| Impact of M&A transactions (b) | **0.90** | 0.47 |
| Legacy MDA Europe legal matters (c) | **—** | 0.65 |
| Restructuring expense (a) | **0.91** | — |
| Income tax impact | **0.26** | (0.12) |
| Normalized tax rate adjustment (d) | **(3.64)** | 1.66 |
| Ongoing earnings per diluted share | **$2.39** | $4.21 |

| Free Cash Flow (FCF) Reconciliation: in millions 2024 | Six Months Ended June 30, 2023 | Six Months Ended June 30, |
| --- | ---: | ---: |
| Cash provided by (used in) operating activities | **$(485)** | $(370) |
| Capital expenditures | **(228)** | (217) |
| Free cash flow | **$(713)** | $(587) |
| Cash provided by (used in) investing activities | **$(432)** | $(222) |
| Cash provided by (used in) financing activities | **$501** | $(110) |

42

### Footnotes

(a) **RESTRUCTURING EXPENSE -** In March 2024, the Company committed to workforce reduction plans. $23 million was recorded during the first quarter, of which $14 million was employee termination costs and $9 million was other associated exit costs. During the second quarter of 2024, the Company executed additional restructuring actions as part of the Company's complexity reduction and organizational simplification efforts. Total costs for these actions were $50 million, primarily in employee termination costs, which were incurred within the second quarter of 2024.

(b) **IMPACT OF M&A TRANSACTIONS** - On January 16, 2023, we signed a contribution agreement to contribute our European major domestic appliance business into a newly formed entity with Arçelik. In connection with the transaction, we recorded a loss on disposal of $292 million for the six months ended June 30, 2024, of which $45 million was incurred in the second quarter of 2024. Additionally, we incurred other unique transaction related costs related to portfolio transformation for a total of $17 million for the six months ended June 30, 2024, of which $5 million was incurred in the second quarter of 2024. These transaction costs are recorded in Selling, General and Administrative expenses on our Consolidated Condensed Statements of Comprehensive Income (Loss).

For the six months ended June 30, 2023, a loss on disposal of $240 million was recorded, of which $18 million was recorded during the second quarter. Additionally, we incurred other unique transaction related costs related to portfolio transformation for a total of $8 million for the three and six months ended June 30, 2023. These transaction costs are recorded in Selling, General and Administrative expenses on our Consolidated Condensed Statements of Comprehensive Income (Loss).

(c) **LEGACY MDA EUROPE LEGAL MATTERS** - During the second quarter of 2023, the Company accrued $36 million related to the Competition Investigation and Trade Customer Insolvency matters of our European major domestic appliance business.

(d) **NORMALIZED TAX RATE ADJUSTMENT** - During the second quarter of 2024, the Company calculated a GAAP tax rate of (687)%. Ongoing earnings per share was calculated using an adjusted tax rate of (14)%, which excludes the non-tax deductible impact of M&A transactions of approximately $50 million recorded in the second quarter of 2024 and certain other tax impacts related to Europe transaction. The Company expects a full-year GAAP tax rate of approximately 25% and adjusted effective tax rate of approximately (8)%, revised from the prior quarter estimate primarily due to lower forecasted earnings before income taxes.

During the second quarter of 2023, the Company calculated ongoing earnings per share using an adjusted tax rate of 11%, which excludes the non-tax deductible impact of M&A transactions of approximately $26 million recorded in the second quarter of 2023. During the full-year of 2023, the Company calculated ongoing earnings per share using an adjusted tax rate of (7)% which excludes the non-tax deductible impact of M&A transactions of approximately $25 million recorded in the fourth quarter of 2023 and which reflects certain tax benefits related to legal entity restructuring transactions in the fourth quarter of 2023.

Additionally, in the full-year 2024 outlook, the Company calculated ongoing earnings per share using a full-year adjusted tax (non-GAAP) rate of approximately (8)%. Subsequent to the closure of the Europe transaction, the Company has recorded certain significant tax benefits related to legal entity restructuring transactions. Additional tax impacts from legal entity restructuring projects are possible in future quarters, and those future impacts have been included in our expected full-year non-GAAP tax rate. Reconciling from our expected full-year GAAP tax rate of approximately 25%, certain Europe transaction tax impacts have been adjusted from our full-year adjusted tax (non-GAAP) rate of approximately (8)%.

### FORWARD-LOOKING PERSPECTIVE

Earnings per diluted share presented below are net of tax. We currently estimate our anticipated 2024 full-year GAAP tax rate of approximately 25% and adjusted tax rate of approximately (8)%. We currently estimate earnings per diluted share for 2024 as follows:

| Estimated GAAP earnings per diluted share, for the year ending December 31, 2024 Including: | 2024 Current Outlook ~$3.00 |
| --- | ---: |
| Impact of M&A transactions | $5.75 |
| Restructuring expense | $1.25 |
| Income tax impact | $0.50 |
| Normalized tax rate adjustment | $1.50 |
| **Industry Demand** |  |
| MDA North America | Flat |
| MDA Latin America | 5 - 7% |
| MDA Asia | 4 - 6% |
| SDA Global | Flat |
| MDA Europe (Q1 Actuals) | (1)% |

For the full-year 2024, we expect to generate cash from operating activities of approximately $1,050 million and free cash flow of approximately $500 million, including restructuring cash outlays of approximately $75 million and capital expenditures of approximately $550 million.

Additionally, in the full-year 2024 outlook, the Company calculated ongoing earnings per share using a full-year adjusted tax (non-GAAP) rate of approximately (8)%. Subsequent to the closure of the Europe transaction, the Company has recorded certain significant tax benefits related to legal entity restructuring transactions. Additional tax impacts from legal entity restructuring projects are possible in future quarters, and those future impacts have been included in our expected full-year non-GAAP tax rate. Reconciling from our expected full-year GAAP tax rate of approximately 25%, certain Europe transaction tax impacts have been adjusted from our full-year adjusted tax (non-GAAP) rate of approximately (8)%.

The table below reconciles projected 2024 cash provided by operating activities determined in accordance with GAAP to free cash flow, a non-GAAP measure. Management believes that free cash flow provides stockholders with a relevant measure of liquidity and a useful basis for assessing Whirlpool's ability to fund its activities and obligations. There are limitations to using non-GAAP financial measures, including the difficulty associated with comparing companies that use similarly named non-GAAP measures whose calculations may differ from our calculations. We define free cash flow as cash provided by operating activities less capital expenditures. For additional information regarding non-GAAP financial measures, see the Non-GAAP Financial Measures section of this Management's Discussion and Analysis.

| Millions of dollars | 2024 |
| --- | --- |
| **Current Outlook** |  |
| Cash provided by (used in) operating activities (1) | ~$1,050 |
| Capital expenditures | ~$550 |
| Free cash flow | ~$500 |

(1) Financial guidance on a GAAP basis for cash provided by (used in) financing activities and cash provided by (used in) investing activities has not been provided because in order to prepare any such estimate or projection, the Company would need to rely on market factors and certain other conditions and assumptions that are outside of its control.

The projections above are based on many estimates and are inherently subject to change based on future decisions made by management and the Board of Directors of Whirlpool, and significant economic, competitive and other uncertainties and contingencies. Additional information concerning these and other factors can be found in the "Risk Factors" section of our Annual Report on Form 10-K, as updated in Part II, Item 1A of our Quarterly Reports on Form 10-Q.

### OTHER MATTERS

For additional information regarding certain of our loss contingencies/litigation, see Note 6 to the Consolidated Condensed Financial Statements. Unfavorable outcomes in these proceedings could have a material adverse effect on our financial statements in any particular reporting period.

### Antidumping Petitions

As previously reported, Whirlpool filed petitions in 2011 and 2015 alleging that Samsung, LG and Electrolux violated U.S. and international trade laws by dumping large residential washers into the U.S. Those petitions resulted in orders imposing antidumping duties on certain large residential washers imported from South Korea, Mexico, and China, and countervailing duties on certain large residential washers from South Korea. In March 2019, the order covering certain large residential washers from Mexico was extended for an additional five years, and is subject to an extension proceeding in 2024. In August 2022, the order covering certain large residential washers from China was extended for an additional five years.

### Raw Materials and Global Economy

The current domestic and international political environment have contributed to uncertainty surrounding the future state of the global economy. We have experienced raw material inflation in certain prior years based on the impact of U.S. tariffs and other global macroeconomic factors. Due to many factors beyond our control, including the Israel-Palestinian conflict, the Red Sea conflict and its impact on shipping and logistics and government actions in China, among other factors, we expect to continue to be impacted by the following factors: a global shortage of certain components, a strain on raw material and input cost inflation, and fluctuations in logistics availability, timing and costs, all of which began easing in 2023 but remain volatile. This could require us to modify our current business practices, and could have a material adverse effect on our financial statements in any particular reporting period.

## Controls and procedures

As filed, 932 characters.

(a) Evaluation of disclosure controls and procedures

Prior to filing this report, we completed an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934) as of June 30, 2024. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2024.

(b) Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting that occurred during the most recent quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 174 characters.

There have been no material changes in our risk factors from those disclosed in Part I, Item 1A to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Filed Jul 25, 2024.
Source: SEC EDGAR, the filing index for accession 0000106640-24-000125. Last ingested by Listed: Oct 27, 2026, 10:41 ET. No prices; not investment advice.