Doing business amidst a global recovery from a pandemic that is sending all sorts of commodities prices higher — and triggering an inflationary semiconductor shortage — is getting costlier for appliance giant Whirlpool (WHR).
And now it's going to ask consumers to pay more.
"We took price increases in every region of the world, and range from 5% to 12%," Whirlpool CFO Jim Peters told Yahoo Finance Live. "Those are driven by commodity cost increases, and it's something we have done historically."
Key commodities for Whirlpool have surged since March 2020 — steel and oil prices alone are up about 75% and 90%, respectively, over that time period. Hence, it's not a shock to see an industrial such as Whirlpool raise prices to try to protect its bottom line.
Peters said the price increases and strong demand for appliances as people continue to upgrade their homes during the pandemic are two of the main reasons Whirlpool lifted its full-year guidance on Wednesday after the close of trading.
The company now sees full-year earnings of $22.50 to $23.50 a share, up from $19.00 to $20.00 previously. Sales are expected to increase 13% compared to a prior outlook for 6% growth.
"That's reflecting what we see as strong demand, but also reflecting our confidence and out ability to offset these material cost increases," Peters explained.
Whirlpool shares rose slightly in afternoon trading on Thursday.
The company reported that first-quarter sales surged 24% from a year ago to $5.4 billion. All four of Whirlpool's geographic divisions were nicely profitable in the quarter, with growth paced by a 100% improvement in Latin America.
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