Appliance Makers Slashing Outlook
Maytag Posts Loss, Slashes Profit View
Friday July 23, 9:37 am ET -By Karen Jacobs
ATLANTA (Reuters) - Appliance maker Maytag Corp. (NYSE:MYG - News) posted a quarterly loss on Friday on restructuring and litigation charges, and slashed its full-year profit forecast, citing higher steel costs. The maker of Jenn-Air and Amana products also posted weaker sales of its major appliances and Hoover vacuums, as all its divisions showed operating losses. "It's a messy quarter and a bad quarter," said Morgan Keegan analyst Laura Champine. "The real question is, how does this impact results going forward, and I think slashing the (full-year) earnings guidance in half is an indication." Maytag, based in Newton, Iowa, reported a second-quarter loss of $41.1 million, or 52 cents a share, compared with a profit of $25.2 million, or 32 cents a share, a year earlier. The latest quarter included charges totaling 61 cents a share for a major overhaul aimed at cutting costs, litigation over front-load washers, writing down the value of its commercial products business, and an adverse judgment in a lawsuit with distributors. Maytag said second-quarter sales slipped 1 percent to $1.15 billion. Sales of major appliances rose 2 percent, but Maytag lost market share as the gain trailed industry unit growth of 9.7 percent. The company was hurt by a strike at a laundry-products plant and rising costs of steel.
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