Chairman’s Message

2016 Results

2016 was another year of strong performance for Whirlpool Corporation as we delivered record results for the fifth consecutive year through strong operational execution and decisive actions to adjust to changes around the world.


Revenues of $20.7 billion, an increase of 1.6 percent excluding the impact of currency


Record ongoing earnings per share of $14.06, an increase of 14 percent


Strong free cash flow generation of $630 million

Throughout the year, we quickly adapted our plans and focused on what we could control to more than offset continued global economic volatility. We delivered earnings per share growth of 14 percent, revenue growth of 1.6 percent, excluding the impact of currency, and $630 million in free cash flow.

During the past few years, macroeconomic volatility has been a factor in many of the countries in which we operate. We continued to experience that volatility during 2016. The Brexit decision in June had a negative impact on British currency and demand, while uncertainty in emerging markets generated additional currency and demand weakness, especially in Brazil, Russia and China. These challenges, along with a further strengthening U.S. dollar, had a combined negative impact of approximately $600 million in revenue and $2 per share of earnings.

Our earnings growth and strong cash generation enabled us to create long-term shareholder value through the execution of our balanced capital allocation approach. We invested in our innovation pipeline through $660 million in capital expenditures while increasing our dividend by 11 percent and buying back $525 million in common stock. These investments continue to be supported by a strong balance sheet, an increased capacity to invest and the confidence that our operating plans will deliver extraordinary levels of shareholder value both now and in the future.


Our long-term value creation framework is built upon the strong foundation we have in place: our industry-leading brand portfolio and robust product innovation pipeline, supported by our best-cost global operating platform and executed by our exceptional employees throughout the world. We measure these value-creation components by focusing on a few key measures:

  • Deliver 3 to 5 percent annual organic net sales growth across our global footprint
  • Grow earnings per share by 10 to 15 percent annually
  • Expand EBIT margins to 10 percent plus by 2020, through strong cost productivity programs and further leveraging our strong brands and innovative new products
  • Generate free cash flow of 5 to 6 percent of net sales by 2018, which represents over 85 percent earnings to free cash conversion

We remain confident in our ability to effectively manage our business regardless of the operating environment and expect to continue delivering long-term value for all of our shareholders.


As we have done consistently, we prioritized reinvesting in our business during the year despite changes in the external environment. We continued to invest in product innovation, with approximately $660 million in capital expenditures, more than $600 million in research and development and more than $350 million in brand marketing investments. Our ongoing commitment to fully invest in both core appliances and adjacent businesses helped us launch more than 100 innovative new products in 2016.

We also made significant progress on our acquisition-integration activities in Europe and China. We remain on track to deliver planned cost synergies and restructuring benefits as we realized more than $200 million of benefits globally during the year. Our product platform integrations in Europe remain on schedule, as by mid-2017 more than 80 percent of our products will have been transitioned or optimized as we work to identify the best of the best across our transformed European business. We also advanced our integration in China, including investing in a new technology center and manufacturing operations in Hefei to support our growth strategy in this important emerging market.

Our industry-leading brand portfolio, which includes seven brands with more than one billion dollars in revenue, remains unmatched in the industry. The combination of our global and regional brands uniquely positions us to reach more than 90 percent of consumers globally. When combined with our strong innovation pipeline, these brands allow us to bring meaningful innovation to consumers throughout the world.


The passion and commitment of our people are key enablers of our success. The strength of our global teams is magnified by the experience of our leadership teams and their daily execution of our plans. In spite of significant global economic volatility, our employees in every region executed decisive actions to bring our innovation to consumers. The record results we delivered in 2016 were only possible through the hard work and dedication of our more than 93,000 employees.

The combined excellence of our people and our world-class operating platform enables us to fully invest in our strong brands and product innovation pipeline. The resulting combination of brand strength, product innovation and best cost structure is a winning formula which has helped us deliver record financial results.


As we look to 2017 and beyond, we continue to see multiple avenues for profitable growth and margin expansion.

In the United States, we anticipate strong replacement appliance demand as well as further growth of housing starts and existing home sales in 2017. The long-term trends demonstrate strong demand for housing, real wage growth, healthy consumer sentiment and low levels of unemployment. Each of the past 16 quarters has seen appliance industry growth in the U.S., and we are confident that the fundamentals underpinning the industry will support further growth in the coming years.

Internationally, our strong footprint and operating platform across emerging markets will position us to capitalize on future growth in those economies. We are seeing signs of continued strength in India, demand recovery across Eastern Europe and stabilization in Brazil as we head into 2017. The strong dollar era will likely persist, though we do not anticipate currency devaluation at the levels we experienced in 2015 and 2016. We do expect some continued global economic volatility, specifically in the United Kingdom, and some increase in raw material costs. In total, we expect the cumulative impact of global economic volatility to be less of a headwind in 2017 than in recent years.

There are significant opportunities for growth in all parts of our business, and we will continue to prioritize investing in innovation to launch new products throughout the world. We also remain committed to cost productivity by leveraging our right-sized fixed cost structure and reducing platform complexity globally.

In 2017, we expect to deliver another record year through the focused execution of our strategy, with earnings per share growth of 9–16 percent and generating approximately $1 billion in free cash flow. We will continue our balanced approach to capital allocation, including reinvesting in our business, attractive dividend payouts, meaningful share repurchases and assessing value-creating M&A opportunities.

Revenue $ in Billions
  • 2014
  • 2015
  • 2016
Ongoing business earnings per diluted share*
  • 2014
  • 2015
  • 2016
Free CASH flow* $ in Millions
  • 2014
  • 2015
  • 2016
Debt/total capital**
  • 2014
  • 2015
  • 2016
  • Non-GAAP; See page 42 of the PDF for reconciliation.
  • Total debt divided by debt and total stockholders' equity.


We remain committed to being the best global branded consumer products company in every home around the world.

Inspired by that vision, our long-term value creation strategy remains unchanged. We have demonstrated time and again our ability to overcome the challenges of a volatile global environment through the resolve of our people and the strength of our global footprint. We will continue to leverage our global operating platform, consumer-relevant innovations and unmatched brand portfolio, and we believe our ability to generate future earnings growth and free cash flow is very strong.

Thank you for your continued support of our brands and products and your investments in our company. We look forward to furthering our legacy of long-term value creation for our shareholders while improving the lives of consumers throughout the world every day.

Jeff M. Fettig

Chairman of the Board and
Chief Executive Officer