Whirlpool 2003 Annual Report Download

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2003 Summary Annual Report
passionately creating loyal customers for life
every home...everywhere

Table of contents

  • Page 1
    2003 Summary Annual Report every home...everywhere passionately creating loyal customers for life

  • Page 2
    ...Pro Line series of major and portable kitchen appliances with distinctive and complementary designs, professional performance and premium customer service. KitchenAid continues to deliver unique solutions that appeal to cooking enthusiasts in ways that are creating unmatched levels of loyalty across...

  • Page 3
    ...and reward investors with superior returns and to create brand experiences that delight our customers. Table of Contents Chairman's Letter p. 10 Financial Highlights p.13 President's Message p.14 2003 Regional Brands and Products p.16 North America Operating Review p.18 Europe Operating Review p.20...

  • Page 4
    ... best, both for price and functions. I like a washer that can wash a lot of clothes and wash them clean, and I know this Whirlpool washer will do that." Customer: Liu Xiao Lu Location: Shanghai, China Occupation: Enterprise Resource Planning (ERP) Core Team Member The Whirlpool Super Easy Wash front...

  • Page 5
    ... global resources of Whirlpool Corporation-68,000 employees worldwide, sales organizations in more than 170 countries and nearly 50 manufacturing and technology research centers around the globe-provide a competitive advantage that sets us apart from other appliance manufacturers. We use our global...

  • Page 6
    ...Gotti, Jr. Location: Santos, Brazil Occupations: Claudia and Raul, attorneys The Consul Ideale clothes washer applies innovative technology and global design to deliver an affordable automatic washer to loyal customers in Brazil. Part of the company's "Innovation for Everyone" initiative, the Consul...

  • Page 7
    ... customer loyalty and achieve higher sales and profitability. Innovation leads to greater customer loyalty by helping our brands exceed the expectations of our customers and establish emotional connections that endure. In many cases, customers are willing to pay a premium for innovative products...

  • Page 8
    ... Whirlpool." Customer: Antonella & Raffaele Lanci Location: Varese, Italy Occupations: Antonella, nurse; Raffaele, taxi driver The Whirlpool Conquest side-by-side refrigerator is uniquely designed and configured to appeal to European tastes and needs. As the world's No. 1 appliance brand, Whirlpool...

  • Page 9
    ..., product design and innovations, the retail purchase experience and customer service. Based on this understanding, Whirlpool has built a vibrant portfolio of global brands that connect with the customers we serve. Customer loyalty is cemented when customers fully understand and closely identify...

  • Page 10
    ... and my family." Customer: Cherry Mesa Location: Benton Harbor, Michigan Occupation: Administrative assistant As the largest corporate sponsor for Habitat for Humanity International, Whirlpool Corporation donates an ENERGY STAR®-qualified refrigerator and a range to every Habitat home built in the...

  • Page 11
    ... responsibility Whirlpool Corporation is deeply committed to being a responsible and active corporate citizen in all the communities we operate in around the world. This commitment starts with each of our employees and the values they represent to our customers, our business partners, our investors...

  • Page 12
    ... Executive Officer To Our Shareholders - Last year, a record number of consumers turned to the brands of Whirlpool Corporation for unique products and solutions, and in doing so, strengthened the company's position as the world's leading manufacturer and marketer of major home appliances. Whirlpool...

  • Page 13
    ... the level of employee involvement in the customer loyalty transformation through special training and awareness programs. Thousands participated in programs to help employees better understand the customer and engage in new loyalty efforts. The company also launched Whirlpool University, an on-line...

  • Page 14
    ...'s "Annual Design Review" competition. The Whirlpool Duet washer and dryer pair, and Whirlpool Europe's Project F conceptual fabric care products won top honors. â- Whirlpool co-sponsored the 2003 Jimmy Carter Work Project in the U.S. Employee volunteers helped build 92 homes, and the company...

  • Page 15
    ...67 $ 1.36 2.2% (26.9)% % Change 10.5% 58.0% 56.3% NM1 NM1 76.0% 11.0% 73.9% - Share price High Low Close Total return to stockholders (five-year annualized) Shares outstanding (in 000's) Number of registered stockholders Number of employees $ 73.35 $ 42.80 $ 72.65 8.1% 68,931 8,178 68,407 $ 79.80...

  • Page 16
    ... in Whirlpool's brands and products also reflects the success of the company's ongoing efforts to embed innovation as a core competency. Today, more than 500 employee innovation mentors have trained more than 10,000 employees to create and commercialize new products and solutions for our customers...

  • Page 17
    ... North America, for example, we leverage the scale and efficiency of Whirlpool's Clyde, Ohio, facility-the world's largest clothes washer manufacturing operation-to help maintain the company's laundry leadership in the North American market. We also leverage the advantages of Whirlpool's production...

  • Page 18
    ..., Whirlpool, Roper by Whirlpool Corporation, Estate, Gladiator Canada Inglis,Whirlpool, KitchenAid Mexico Whirlpool, Acros, Supermatic, Crolls Headquarters: Benton Harbor, MI Manufacturing Locations: United States LaVergne, TN; Findlay, OH; Marion, OH; Greenville, OH; Clyde, OH; Benton Harbor, MI...

  • Page 19
    ... New Products introduced in 2003 Air Purifiers, Automatic Dryers, Automatic Washers, Built-in Ovens, Countertop Appliances, Dehumidifiers, Dishwashers, Freezers, Hot Water Heaters, Ice Makers, Microwave Ovens, Ranges, Refrigerators, Room Air Conditioners, Trash Compactors â- â- â- Whirlpool...

  • Page 20
    ... family solutions for a room too long ignored. Other customer loyalty initiatives, driven by Whirlpool engineers, designers and marketers, helped produce a number of outstanding products that reached their first full year of sales in 2003. Among them were: the Whirlpool Duet clothes washer and dryer...

  • Page 21
    ... the 2003 Jimmy Carter Work Project. This annual project will be held in the company's headquarters community of Benton Harbor, Michigan, in 2005. Whirlpool donates an ENERGYSTAR qualified refrigerator and freestanding range for every Habitat home built in North America. Likewise, the KitchenAid...

  • Page 22
    ... exclusively a full range of appliances-including built-in appliances-to IKEA regionally and worldwide. The agreement helps extend the company's European distribution capability and expand its built-in business, particularly for cooking products. Also last year, Whirlpool Europe signed a long-term...

  • Page 23
    ... technology. Embraco also oversees manufacturing operations in Italy, Slovakia and China. Whirlpool's Brazilian operations also became an even more integral part of the company's overall global operating platform in 2003 with the engineering, design and production of the Consul Ideale clothes washer...

  • Page 24
    ... manufacture the bulk of the company's microwave ovens for world markets. China also is fast becoming an integral supply source for the company's global procurement activities. Whirlpool Asia expanded its product development capabilities with the opening of three new technology centers that support...

  • Page 25
    ... the Company's Proxy Statement and in the Financial Supplement to the 2003 Annual Report on Form 10-K, both of which are available through the Internet at www.whirlpoolcorp.com. Executive level overview Whirlpool Corporation is the largest global manufacturer of major appliances worldwide with 2003...

  • Page 26
    ... expense in 2003. Asia's higher selling, general and administrative expenses, as a percent of sales, were due to increased operating reserves. Product Recalls During 2003, the Company recognized pre-tax charges of $16 million primarily for final expenses related to the 2001 recall of microwave-hood...

  • Page 27
    ... stock during 2003 for $65 million under a stock repurchase program previously authorized by the Board of Directors. The Company also redeemed $33 million in preferred stock of its discontinued finance company, Whirlpool Financial Corporation. In connection with its stock-based compensation programs...

  • Page 28
    ...repurchase program previously authorized by the Board of Directors, the Company repurchased a combined total one million shares of Whirlpool common stock in the open market subsequent to December 31, 2003, at an aggregate purchase price of $75 million. In December 2003, Whirlpool Corporation's Board...

  • Page 29
    ... Statements of Operations Year Ended December 31 (Millions of dollars except per share data) 2003 $12,176 2002 $11,016 2001 $10,343 Net sales Expenses Cost of products sold Selling, general and administrative Intangible amortization Product recall costs Restructuring costs Operating Profit...

  • Page 30
    ... and equivalents Trade receivables, less allowances (2003: $113; 2002: $94) Inventories Prepaid expenses Deferred income taxes Other current assets Total Current Assets $ 249 1,913 1,340 62 129 172 3,865 $ 192 1,781 1,089 64 83 118 3,327 Other assets Investment in affiliated companies Goodwill, net...

  • Page 31
    December 31 (Millions of dollars) 2003 2002 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Notes payable Accounts payable Employee compensation Deferred income taxes Accrued expenses Restructuring costs Other current liabilities Current maturities of long-term debt Total Current ...

  • Page 32
    ... Equity in losses of affiliated companies, less dividends received Loss on disposition of assets Loss on discontinued operations Depreciation and amortization Changes in assets and liabilities, net of business acquisitions: Trade receivables Inventories Accounts payable Product recalls Restructuring...

  • Page 33
    ... and Board of Directors Whirlpool Corporation Benton Harbor, Michigan We have audited, in accordance with auditing standards generally accepted in the United States, the Consolidated Balance Sheets of Whirlpool Corporation as of December 31, 2003 and 2002, and the related Consolidated Statements of...

  • Page 34
    ... change Diluted net earnings (loss) (3) Dividends Book value Closing Stock Price - NYSE 6.03 5.91 5.91 1.36 18.56 72.65 3.86 3.78 (5.68) 1.36 10.67 52.22 0.51 0.50 0.31 1.36 21.44 73.33 Key ratios (4) Operating profit margin Pre-tax margin (5) Net margin (6) Return on average stockholders' equity...

  • Page 35
    ... taxes and other items, as a percent of sales. Earnings from continuing operations, as a percent of sales. Net earnings (loss) before accounting change, divided by average stockholders' equity. Net earnings (loss) before accounting change, plus minority interest divided by average total assets. Debt...

  • Page 36
    ...and brokerage commissions for purchases, sales and dividend reinvestment. For details, contact EquiServe or visit their Direct Stock Purchase Plan Web site to enroll. Annual Meeting Whirlpool Corporation's next annual meeting is scheduled for April 20, 2004, at 1:30 p.m. (Central Time), at 181 West...

  • Page 37
    ....1018 Product and Service Information (North America) KitchenAid brand: 800.422.1230 Whirlpool brand: 800.253.1301 Internet Address Whirlpool financial information and more are available at Whirlpool's site on the Internet: www.whirlpoolcorp.com. Common Stock Market Price High Low Close Kenmore is...

  • Page 38
    ... President and President, Whirlpool Europe Former Chairman of the Board and Chief Executive Officer, Kellogg Company Miles L. Marsh 2,4 President and Chief Operating Officer R. Stephen Barrett, Jr. Executive Vice President and Chief Financial Officer David A. Binkley Senior Vice President, Global...

  • Page 39
    our vision every home...everywhere with pride, passion and performance our mission everyone...passionately creating loyal customers for life Design: RWI (rwidesign.com) Major photography: Michael L. Abramson and Whirlpool Photo Services

  • Page 40
    World Headquarters and North America Region 2000 N. M-63 Benton Harbor, MI 49022-2692 Telephone: 269.923.5000 www.whirlpoolcorp.com