Whirlpool 2014 Annual Report Download - page 3

Whirlpool 2014AR p 2 / 3
Chairman’s Message
During the year, we completed two very important
acquisitions that contributed to our record results in
2014 and create an even larger platform for growth
in the future. Our investments in our brands and
products generated more than 70 new product
launches that have set the stage for future years of
margin expansion. We effectively managed through
volatility and headwinds in emerging markets and
continued our focus on driving benefits through
ongoing cost productivity programs.
As a result, we created value for our shareholders
as our stock finished the year at an all-time high
in December and over the last three years, total
shareholder return was 335 percent. We increased
quarterly dividends on the company’s common stock
by 20 percent and repurchased $25 million of shares
under the current share repurchase program that has
$475 million in authorized funds remaining.
NEW GLOBAL GROWTH PLATFORM
As we turn the page to 2
015, we expect to be an even
larger global branded consumer products company
with substantial earnings and free cash flow growth.
We have a fundamentally different platform for growth
than we did a decade ago with four value creating
regions, seven brands that generate more than $1 billion
in revenue, truly global earnings diversification
and unprecedented global scale. We are now No.1 in
North America, Europe, and Latin America, and the
No.1 Western Company in Asia.
At our Investor Day in December, we laid out strong
value creation targets through 2018 as we continue
to grow our core appliance business, expand our
adjacent businesses and drive acquisition cost
synergies of nearly $400 million, resulting in:
• Growing revenues by more than 30%
•
Doubling ongoing EPS to $22–$24 per diluted share
• Doubling free cash flow to $1.3–$1.6 billion
MULTIPLE PATHS TO PROFITABLE GROWTH AND
MARGIN EXPANSION
Our acquisitions provide us with outstanding
opportunities for geographic growth and transformation
in Europe and Asia, creating substantial sources of
value creation and diversification of our earnings
profile. Additionally, we have opportunities for growth
as demand in the U.S. continues to recover and we are
well positioned to capitalize when growth returns to
emerging markets such as Brazil, China and India.
In 2014,
we invested more than $700 million in
capital expenditures and will continue accelerating
our investments in relevant technologi
es and
products that benefit our consumers. We are also
driving revenue growth in areas that expand and
extend beyond our core appliance business, and by
leveraging our core infrastructure we will continue to
grow in these higher margin categories.
We also h
ave a significant opportunity to create value
with what we believe is the best global cost structure
in the industry. We wil
l continue to drive ongoing cost
productivity programs, leverage a right-sized fixed cost
structure with volume growth, and reduce complexity
through high volume global platforms. As a result of
these opportunities, we are expecting revenue growth
and margin expansion in every region.
STRATEGIC ARCHITECTURE
These multiple opportunities for growth support our
vision to be the best branded consumer products
company in every home around the world. We leverage
four strategic planks as we strive to create demand
and earn trust with our consumers every day. The first
two planks focus on “what” we do to fulfill that mission.
First, we have to bring great product leadership to
the market every day, driving innova
tion in ways that
matter to consumers. That’s our economic engine.
Second, we have to continue to invest in our great
brands that help us to create demand as each brand
connects with our consumers in a unique way tailored
toward their preferences.
In addition to understanding “what” we do, we must
also focus on “how” we fulfill our mission. The third
and fourth planks address just that. We drive
operating excellence in every part of our business —
from des
ign and manufacturing to selling, shipping
and servicing — as we implement the best practices
from around the world to ensure we are getting better
each and every day. And last, but probably most
important, is people excellence. We invest in our
people just as we invest in our products and have
created a great global employee team. Operating with
2014 RESULTS
2014 was a milestone year for Whirlpool
Corporation as we delivered record
results, created strong shareholder
value and built an exceptional platform
for growth and margin expansion for
2015 and beyond.
• Record revenue of $19.9 billion
•
Record EPS of $11.39
(ongoing business earnings per diluted share)
• Strong cash generation of $854 million
(free cash flow)