Earnings Preview: Whirlpool Corp.

MILWAUKEE - Home appliances maker Whirlpool Corp. reports earnings for its fiscal fourth quarter Monday before the market opens. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: In October, Whirlpool announced it would cut 5,000 jobs this year and next, due in large part to the housing market's decline, on top of 2,000 jobs cut earlier in 2008.

Reporting that its earnings fell 7 percent during the third quarter, the nation's largest home appliance maker lowered its earnings outlook for the year and announced price increases.

Shoppers have continued to curtail their spending due to the prolonged housing slowdown, diminishing credit, escalating food costs and unemployment concerns.

BY THE NUMBERS: Analysts polled by Thomson Reuters, on average, expect Whirlpool to report adjusted net income for the quarter of 78 cents per share on revenue of $4.88 billion. For the year, they forecast earnings of $5.73 per share and revenue of $19.47 billion.

Whirlpool has forecast 2008 earnings of $5.75 to $6 per share, down from a previous estimate of $7 to $7.50 per share.

ANALYST TAKE: Citi Investment Research analyst Jeffrey T. Sprague said in a recent research report that Whirlpool rival Electrolux noted weakening demand for appliances in the two last weeks of November and December, a situation the U.S. company also may have experienced. He predicts Whirlpool's revenue in Europe will fall 4.5 percent and remain flat in Asian markets but jump 14.9 percent in Latin America. He did note that the continued decline in commodity prices provide the possibility of relief to appliance manufacturers in 2009.

WHAT'S AHEAD: The down economy and dismal housing market are seen as significant impediments to Whirlpool's performance through 2009 and perhaps 2010. Last month, Moody's Investors Service cut Whirlpool's rating to one notch above junk status and lowered its outlook, citing the ongoing pullback in discretionary consumer spending. Fitch and Standard & Poor's also lowered ratings on the company, expecting the global home appliance industry, particularly in North America, will face significantly lower demand in 2009.

STOCK PERFORMANCE: Whirlpool's stock has traded between $30.19 and $95.01 over the past year, and closed at $36.39 on Friday.

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