Chairman’s Letter

At Whirlpool Corporation, we took decisive actions in 2011 to position our business for long-term growth in the face of the global economic recession and volatility. We achieved positive results, improving product price and mix and significantly lowering inventory levels. As a clear indication that our actions are working, our North America region realized a more than twofold year-over-year profit improvement during the fourth quarter.

We are committed to driving further growth through our brand value-creation strategy — focusing on margin expansion by delivering consumer-relevant innovation, providing the industry’s best service to the trade and our consumers, and driving lower costs and higher product quality in every aspect of our business.

2011 RESULTS

Our actions in 2011 created increased efficiencies and positioned the business for sustained growth and value creation. These steps were important in the face of high material costs and soft demand that continued globally throughout 2011. The North America market remained at recessionary lows, and we saw high inflation and low consumer confidence slow the rapid growth rates that we have seen the last two years in emerging markets. Europe remained the most challenging region from an international perspective as the European financial crisis drove particularly weak consumer demand across the euro zone.

Revenue

$ in billions

Our revenues grew 2 percent to $18.7 billion in 2011, and diluted net earnings per share were $4.99 compared to $7.97 in 2010. This was largely due to higher material and oil-related costs of approximately $450 million.

2011 HIGHLIGHTS

Our investments in 2011 — our 100th Anniversary year — are yielding positive results as we continue to see strong consumer preference for our innovative new product offerings driving improvement in product mix around the globe. Our efforts were recognized externally with awards for design, sustainability and innovation, including recognition on Fast Company magazine’s 10 Most Innovative Consumer Products Companies list. Following are just a few other recognitions that we received during the year:

• Whirlpool Corporation was named one of Fortune magazine’s World’s Most Admired Companies, ranking No. 1 in the Home Equipment, Furnishings industry sector.
• Whirlpool Corporation was named on the 2011 list of Top Companies for Leaders, ranking ninth globally and sixth in North America.
• Whirlpool Corporation was named one of the Most Respected U.S. Companies by Forbes magazine and the Reputation Institute. This is the fourth consecutive year Whirlpool Corporation has been included in the Most Respected U.S. Companies list. Whirlpool Corporation was ranked 14th on the list.
• Whirlpool Corporation was named one of Corporate Responsibility magazine’s 100 Best Corporate Citizens. This marks the ninth time the company has been named to the list.
• Whirlpool Corporation was named one of DiversityInc magazine’s Top 50 Companies for Diversity.
• For the third year in a row, Whirlpool Corporation was recognized as one of the top 500 U.S. companies in Newsweek magazine’s Green Rankings.
• Whirlpool Corporation was awarded a 2011 ENERGY STAR® Sustained Excellence award — the highest ENERGY STAR award — by the U.S. Environmental Protection Agency. This is the company’s 12th ENERGY STAR award and sixth consecutive top Sustained Excellence win.

Diluted Earnings per Share from Continuing Operations

We improved our industry-leading quality position around the globe during 2011. Our efforts gained recognition by a leading U.S. consumer magazine, which found that many of our appliances last longer and are more reliable than competitors’ appliances in the refrigeration, cooking, laundry and dishwasher categories for Whirlpool, Maytag, KitchenAid, Jenn-Air and Amana brands. As just one category example, Whirlpool Corporation brands took 11 of the top spots in front and top-load washer rankings.

INNOVATION THAT CONSUMERS DESIRE

We know our long-term growth opportunities are abundant, and we will continue to invest in consumer-relevant innovation, appliance growth in new and emerging markets, expansion into higher-margin, faster-growing adjacent businesses, and advancement of our global brand portfolios.

Keeping our core appliance business healthy and growing is critical to our success. Innovation is the fundamental driver of our growth — as it has been for the last century — and we invest more than $500 million annually in Research & Development. We have seen time and time again that, while competitive price promotions may deliver short-term market share gains, only strong, preferred brands with consumer-relevant innovation win in the long term.

Debt/Total Capital⁽¹⁾

(1)	Total debt divided by total debt and total stockholders’ equity.

We are increasingly able to leverage the strength of our global brand names by expanding into higher-margin, faster-growing product lines that complement our core appliance business. Today, branded consumer product businesses outside our traditional core — including garage organization, countertop appliances and water filtration — represent approximately 22 percent of our annual revenues and are growing at a double-digit pace.

In addition, we expect to see growth in emerging markets as more consumers are able to purchase appliances and benefit from the quality and convenience they provide. The potential in developing countries is tremendous if we consider the population and economic growth trends as well as the very low appliance penetration levels.

We believe people everywhere deserve a comfortable place to call home with access to fresh food, clean clothes and drinking water. Whether it is to provide basic refrigeration to a consumer in India or a water- and energy-efficient laundry pair to a consumer in Germany, we stand ready to improve the lives of consumers each and every day all around the world.

2012 PRIORITIES

We are executing robust initiatives to continue to improve operating margins in 2012 through a strong cadence of innovation, capacity and cost-reduction initiatives, ongoing productivity programs and previously announced price increases.

The restructuring actions we announced in October are on track to substantially reduce our structural fixed costs in order to strengthen our business and deliver value-creating results for our customers and shareholders. We expect to realize $200 million in fixed cost savings in 2012, and an additional $200 million in 2013, or $400 million in annualized cost savings in 2013 and thereafter.

In addition, we expect to return to more normal levels of positive net productivity. Driving lower costs and higher product quality across our global operations allows for additional resources to invest in the critical innovation needed to fuel the business.

Cash Flow Provided by Continuing Operating Activities

$ in millions

In the second half of 2011, we started to realize benefits from previously announced cost-based pricing actions. Momentum will continue and margins are expected to expand as these price increases carry into 2012, and we see the results from additional cost-based price increases that went into effect in January of this year in several other markets.

Collectively, these priorities, despite a still-weak global economy, will enable us to have a strong year of operating performance improvement.

RIGHT FOUNDATION FOR SUCCESS

As we begin 2012 — and our second century of operations — I am optimistic about the opportunities we have created at Whirlpool Corporation to deliver positive results and win in the marketplace. We are positioned to drive sustained future growth and create value for our shareholders, our employees and the consumers who use our products in their homes every day.

We have empowered our people to do what no other appliance company can match — to Improve Lives … One Home, One Family at a Time … through World-class Products and Services. We make household chores easier so that families can spend more time together. This clear sense of purpose unifies our global workforce and inspires the society-transforming innovations that ultimately drive profitable growth and create shareholder value.

Sincerely,