Slide 1: Second-Quarter 2023 Earnings Review
Second-Quarter 2023 Earnings Review TUESDAY, JULY 25, 2023
Slide 2: Cautionary Statement
Cautionary Statement This document contains forward-looking statements about Whirlpool Corporation and its consolidated subsidiaries ("Whirlpool") that speak only as of this date. Whirlpool disclaims any obligation to update these statements. Forward-looking statements in this document may include,
Slide 3: Non-GAAP Measures
Non-GAAP Measures This presentation includes certain 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, inc
Slide 4: Second-Quarter Earnings & 2023 Perspective
Second-Quarter Earnings & 2023 Perspective Whirlpool Corporation Confidential Marc Bitzer Jim Peters CHAIRMAN AND EXECUTIVE VICE CHIEF EXECUTIVE PRESIDENT AND CHIEF OFFICER FINANCIAL OFFICER
Slide 5: Table of Contents
Table of Contents Sequentially improved Q2 results, in line with expectations Business performance update and 2023 guidance Portfolio transformation on track 5
Slide 6: Sequentially Improved 2023 Second-Quarter Results
Sequentially Improved 2023 Second-Quarter Results PROFITABLE GROWTH Net Sales YoY Change ● Share gains in North America and Latin America offset by negative $4.8B (6.0)% price/mix and EMEA demand weakness (7.2)% organic MARGIN EXPANSION ● Cost take out actions delivered ~$150M in Q2; On track to deli
Slide 7: Ongoing EBIT Margin Drivers
Ongoing EBIT Margin Drivers Q1’23 vs Q2’22 vs (Approximate impact) Q2’23 Q2’23 Ongoing EBIT Margin 5.4% 9.0% Price/Mix -0.50 -3.50 Net Cost* +1.50 +1.25 Raw Material Inflation +1.25 +1.50 Marketing & Technology Investments -0.25 -0.50 Currency nm -0.50 2023 Ongoing EBIT Margin 7.3% 7.3% *Inclusive of
Slide 8: Substantial Cost Take Out Actions On Track
Substantial Cost Take Out Actions On Track $500M Net Cost & RMI ($M) $0M $800M - $900M $(500)M Continue to expect cost structure reset to deliver $800M - $900M benefit 8
Slide 9: Table of Contents
Table of Contents Sequentially improved Q2 results, in line with expectations Business performance update and 2023 guidance Portfolio transformation on track 9
Slide 10: North America Second-Quarter Results
North America Second-Quarter Results Sequential Year-over-Year NET SALES ($B) 3% -5% ● Year-over-year share gains of ~1pt, with flat U.S. industry demand Q1 2023 Q2 2023 Q2 2022 Q2 2023 -31% 6% ● EBIT impacted by InSinkErator EBIT ($M) integration and negative price/mix Q1 2023 Q2 2023 Q2 2022 Q2 202
Slide 11: U.S. New Housing Has Been Undersupplied for More Than A Decade
U.S. New Housing Has Been Undersupplied for More Than A Decade Thus Creating Long Term Upside Tech Bubble Great Recession Covid-19 Recession New Privately Owned Housing Units Started (M) 2.0 Steady state supply 1.7-1.9M 1.5 1.0 Rebound of housing starts during last few months 0.5 0.0 2001 2003 2005
Slide 12: Our Strong Builder Share Has Us Well Positioned to Win
Our Strong Builder Share Has Us Well Positioned to Win in This Upside Trend Whirlpool Share Across National Builders 65% BUILDERS’ #1 CHOICE: Best Brand Portfolio 55% Full Suite Offerings Final Mile Delivery Capabilities 40% 2013 2015 2017 2019 2021 2023F Source: AHAM, forecast reflects internal expe
Slide 13: EMEA Second-Quarter Results
EMEA Second-Quarter Results Sequential Year-over-Year NET SALES ($B) -4% -15% ● Continued demand weakness across key countries; Organic net sales decline ~12% year-over-year Q1 2023 Q2 2023 Q2 2022 Q2 2023 EBIT ($M) ● Cost take out actions and held 240% 750% for sale benefits driving EBIT margin expa
Slide 14: LAR Second-Quarter Results
LAR Second-Quarter Results Sequential Year-over-Year NET SALES ($B) 8% 4% ● Continued demand improvement in Mexico Q1 2023 Q2 2023 Q2 2022 Q2 2023 ● Excluding currency, net sales 36% -7% increased ~5% year-over-year EBIT ($M) driven by share gains ● EBIT margins impacted by Q1 2023 Q2 2023 Q2 2022 Q
Slide 15: Asia Second-Quarter Results
Asia Second-Quarter Results Sequential Year-over-Year NET SALES ($B) 15% -13% ● Excluding currency, net sales decline ~8% year-over-year Q1 2023 Q2 2023 Q2 2022 Q2 2023 ● Sequential share gains offset -52% by demand weakness EBIT ($M) 38% ● EBIT impacted by strong cost take out actions and negative Q
Slide 16: 2023 Guidance
2023 Guidance PROFITABLE GROWTH MARGIN EXPANSION CASH CONVERSION LONG-TERM GOALS 5-6% 11-12% 7-8% ONGOING EARNINGS BEFORE INTEREST FREE CASH FLOW ANNUAL ORGANIC NET SALES GROWTH AND TAX, % OF NET SALES AS % OF NET SALES Net Sales YoY Change Ongoing EBIT YoY Change Free FCF as % of Margin Cash Flow N
Slide 17: Ongoing EBIT Margin Guidance
Ongoing EBIT Margin Guidance (Approximate impact) Previous Current Comments 2022 Ongoing EBIT Margin 6.9% 6.9% • Promotional activities near pre-pandemic levels, Price/Mix -2.25 -2.50 partially offset by mix • Strong cost takeout actions delivering ~$500M Net Cost* +2.50 +2.50 benefit • Expect ~$300 -
Slide 18: 2023 Regional Guidance
2023 Regional Guidance Industry EBIT % Previous Current Previous Current North (6) - (4)% unchanged ~12% ~11.5% America Europe, Middle East (6) - (4)% unchanged ~2.5% ~1.5% & Africa Latin (3) - (1)% unchanged ~7% unchanged America Asia 2 - 4% unchanged ~5.5% unchanged Total ~(3)% unchanged ~7.5% ~7.
Slide 19: Table of Contents
Table of Contents Sequentially improved Q2 results, in line with expectations Business performance update and 2023 guidance Portfolio transformation on track 19
Slide 20: Portfolio Transformation Well Underway
Portfolio Transformation Well Underway THREE STRONG PILLARS SMALL MAJOR COMMERCIAL APPLIANCES APPLIANCES APPLIANCES GROW, ALSO INORGANICALLY STRENGTHEN + REFOCUS GROW, ALSO INORGANICALLY More Global in Nature Win in Americas Structurally Attractive (#1 Position) & B2B Business Serve ‘Full’ Cooking A
Slide 21: InSinkErator Business Delivering Strong Margins
InSinkErator Business Delivering Strong Margins ● Brand reputation for highest quality and performance ● Predictable, recurring sales driven by installed base ● New disposer represents the most significant innovation in last decade ACQUISITION TRANSACTION SUCCESSFUL PRODUCT VALUE ANNOUNCED CLOSED INT
Slide 22: EMEA Transaction Update
EMEA Transaction Update ● Customary regulatory process progressing as expected ● Continue to expect closing in second half 2023, likely in the fourth quarter ● Retaining 25% stake(1) in a newly formed European appliance company ● $750M+ net present value of predictable cash flows of Whirlpool brand a
Slide 23: Balanced Capital Allocation Priorities
Balanced Capital Allocation Priorities 1. Fund Innovation and Growth Target/Update Capital Expenditure Invest ~3% of net sales Research and Development Invest ~3% of net sales Mergers & Acquisitions Pursue opportunistic M&A with high ROIC 2. Return to Shareholders Target/Update Dividends ~30% of tra
Slide 24: Maintain Gross Debt Leverage Commitment with Expected $500M Debt Paydown
Maintain Gross Debt Leverage Commitment with Expected $500M Debt Paydown in 2023 $8,000 Whirlpool Long-Term Debt ($M) $4,000 Current Maturities of Long-Term Debt Long-Term Debt $0 2015 2017 2019 2021 2023F Year-End Gross Debt Leverage: 1.9 2.1 2.6 3.0 2.5 2.3 1.8 4.1 ~4 24
Slide 25: Well Balanced Debt Ladder Provides Flexibility
Well Balanced Debt Ladder Provides Flexibility $2,000 Financing Arrangements ($M) $1,000 $0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 Acquisition Related Senior Notes Term Loan 25
Slide 26: On Track to Deliver Strong Value Creation
On Track to Deliver Strong Value Creation ● Delivered solid sequential margin expansion ● Cost takeout actions expected to deliver $800M - $900M ● Well positioned to benefit from housing-driven demand recovery and share gains in North America ● Portfolio transformation on track to deliver a higher-gr
Slide 27: Closing Remarks and Q&A
and Q&A Closing Remarks Whirlpool Corporation Confidential
Slide 28: Key Assumptions - Guidance
Key Assumptions - Guidance Income Statement FY2022A FY2023E Raw Material (Inflation) / Deflation $(1.5)B ~$300 - $400M * Restructuring Costs $15M Interest Expense $190M ~$325M Adjusted Effective Tax Rate 4.4% 10 - 15% Weighted-Average Diluted Shares Outstanding 56.5M 55.2M** Cash Flow Statement FY2022A
Slide 29: 2023 Free Cash Flow Guidance Remains Unchanged
2023 Free Cash Flow Guidance Remains Unchanged (Approximate impact in millions) 2022 2023 Comments Cash Earnings and Other Operating Items $1,236 ~$1,400 • Innovation, digital transformation and Capital Expenditures $(570) ~$(600) capacity investments Working Capital $194 ~$25 • Sustained low workin
Slide 30: Interest and Sundry (Income) Expense
Interest and Sundry (Income) Expense Q2 (Approximate impact in millions) 2022 2023 Comments • Includes foreign exchange and hedge Net Foreign Exchange $8 $0 (gain)/loss Interest (Income) Expense/Other (26) 10 • Legacy EMEA legal matters Equity Method Investment Income (Loss)* (1) 3 Interest and Sund
Slide 31: Restructuring Cash Outlays
Restructuring Cash Outlays (Approximate impact in millions) 2022 2023E Comments COVID-19 Related Actions $10 $15 Naples Closure 3 - • Naples, Italy manufacturing facility Other Initiatives 27 10 • Primarily previously executed actions Total $40 ~$25 Note: Numbers may not reconcile due to rounding 31
Slide 32: Hotpoint brand ownership note
* Whirlpool Corporation ownership of the Hotpoint brand in EMEA and Asia Pacific regions is not affiliated with the Hotpoint brand sold in the Americas