AGM 2021

Apr 20, 2021

morning, ladies and gentlemen. I'm Mark Bitzer, Chairman of the Board and Chief Executive Officer of Whirlpool Corporation. Joining me here today is Jim Peters, Chief Financial Officer Ava Hartner, Chief Legal Officer and Bridget Quinn, Corporate Secretary. Welcome to our 2021 Annual Meeting of Stockholders. Before we begin the business of today's meeting, I'd like to say that we had hoped to hold an in person meeting this year, but clearly the pandemic and the related risks are still with us. And in light of this and as part of our precautions and to support the health and well-being of our stockholders, employees and community, we are holding the annual meeting virtually again this year. Now I would like to review the process for the question and answer period, which will follow my remarks about our 2020 financial performance later in the meeting. We want to ensure stockholders are afforded the same opportunities to participate in today's meeting, including the opportunity to ask questions. If you are a stockholder and have a question, you may submit your Please submit your questions as early as possible so that they are in the queue and we're ready to start the Q and A session. Please note that we have not yet released earnings for Q1 and will therefore not be answering any questions about our Q1 financial performance today. All of the nominees for election to the Board of Directors have joined the meeting today, including Sam Elm, Greg Creed, Gary DeCamillo, Diane Dietz, Jerry Elliott, Jen Lachlair, John Liu, Jim Lohrey, Harish Manvani, Patty Poppe, Larry Spencer, Mike White and myself, Mark Bitzer. Representatives from our independent auditor, Ernst and Young, and our Inspectors of Election Broadridge Financial Solutions are also joining our meeting today. Today's meeting agenda and the rules of conduct and other meeting materials are available for downloading at any time during the meeting by clicking the Materials button at the bottom of your screen. The rules of conduct set forth for procedures we will follow during the meeting. We will conduct the business portion of our annual meeting first. I will then make a few remarks about our 2020 financial performance, and then we will begin the question and answer session. Notice of this meeting was first mailed out to our stockholders on March 10, 2021, and this meeting is being held in accordance with the company's bylaws. The polls have been open for voting since March 10, 2021, and will remain open online until we have concluded the official portion of this meeting. Stockholders who have already voted your proxies may choose to do nothing and your shares will be voted as you instructed. If you wish, stockholders and beneficial owners may still revoke your proxy and vote online by clicking the voting button at the bottom of your screen. Our inspectors of election Broadridge Financial Solutions have determined they are present in person or by proxy at this meeting holders of a majority of the approximately 63,000,000 shares outstanding on the record date February 22, 2021. They have determined the voting power of each and have verified that a quorum is present. They will also determine the validity of all proxies and ballots, tabulate and certify the vote and if needed perform other duties required by law. Because stockholders holding majority for shares outstanding and eligible to vote are represented at the meeting, a quorum is present and the meeting is lawfully constituted and will pursued. At this meeting, we plan to take action on the election of 13 directors and 2 other management proposals, all as outlined in the agenda for this meeting and described in more detail in the company's proxy statement. The proxy statement lists the slate of 13 nominees for directors proposed by the Board of Directors. You can read a short biography of each of the Board's nominees in the company's proxy statement. If elected, each nominee would serve for 1 year term. I hereby declare them duly nominated. As no other nominations have been properly submitted to the corporate secretary, I declare the nominations closed and formally place the Board's nominees before this meeting for stockholder approval. Next, we'll consider the 2 management proposals outlined in the agenda and described in more detail in the company's proxy statement. The proposals are an advisory vote on executive compensation and ratification of the appointment of Ernst and Young as the company's auditors. I now formally submit these 2 management proposals for stockholder approval. As no other proposals have been submitted to the corporate secretary, we will now proceed with election of directors and the vote on the 2 management proposals. If you are a stockholder and have not yet voted or if you want to change a previously cast vote, please do so now by clicking the voting button at the bottom of your screen. Before we adjourn the official business portion of this meeting, I would like to provide a preliminary voting report based on the tabulation of proxies by the Inspector of Elections received prior to today's meeting. The inspectors have certified that each of the nominees named in the company's proxy materials was elected and the 2 management proposals were approved. The final tabulation of these votes will appear in a Form 8 ks to be filed by the company with the SEC within 4 days. This concludes the formal portion of our annual meeting of stockholders. I now declare that the polls are closed. Now I will make a few comments about our 2020 performance, and we will address any questions you may have at the end of my remarks. In 2020, we faced unprecedented challenges due to the ongoing COVID-nineteen pandemic. Yet, we remain firmed in our commitment to serve all of our stakeholders. The health and well-being of our employees was and remains our top priority. We increased safety measures globally at all manufacturing plants. We decisively implemented business continuity plans to support our consumers with our essential products throughout the height of the pandemic. And additionally, we support now local communities with critical supplies and equipment. In parallel, we demonstrate an unwavering commitment to our environmental, social and governance priorities, resulting in significant advancement towards our sustainability targets. It is ultimately the agility of our organization and the early decisive actions we took on costs and our go to market strategy that enabled us to again deliver record results in 2020. We delivered record ongoing earnings per share of $18.55 and ongoing EBIT margin of 9.1 percent, a 220 basis point improvement and a 25% increase in total EBIT compared to the prior year. Our North America region delivered margin expansion for the 3rd consecutive year through our fundamentally improved cost position and disciplined execution of our go to market strategy. Next, we returned our EMEA region to profitability through execution of our strategic initiatives and in line with our plan presented at our 2019 Investor Day. We generated record free cash flow of $1,250,000,000 with positive free cash flow in North America, Latin America and Europe. Despite significant macroeconomic uncertainty, we strengthened our balance sheet, reducing our gross debt leverage to 2.3 times, nearing our goal of 2.0x. And we drove significant shareholder value with a return on invested capital of approximately 11%. Our capital allocation strategy remains unchanged. Fund the business and our strategic investments while returning cash to shareholders. In 2020, we invested $850,000,000 in research and development and capital expenditure to maintain our best cost position in the industry and support our proven track record of providing innovative products and services to our consumers. We returned over $430,000,000 to shareholders in 2020. We increased our quarterly dividend for the 8th consecutive year and repurchased approximately $120,000,000 of common stock. In line with our balanced approach to capital allocation, we remain committed to delivering strong returns for our shareholders. 2020 results demonstrate that we are delivering on our long term value creation goals and we exited the year in a strong financial and operational position to both capture positive demand trends as well as withstand continued volatile and uncertain economic environment. As we look forward, we believe we are uniquely positioned to continue to deliver long term value for our shareholders, while effectively balancing our short term operating priorities. In closing, thank you for your ongoing support of our company, and we will now address any questions that the stockholders might have. It appears we don't have a formal question in the queue. I still want to kind of keep it open for a little while to make sure you have all the opportunity to submit the question. Again, as a reminder, there's a Q and A button at the very right button of your screen. If you have a question, please do so now and we will wait another moment.