Whirlpool to Cut Up to 6,300 Jobs Dec 13 9:55am ET

NEW YORK (Reuters) - Whirlpool Corp. (WHR.N), warning that fourth-quarter earnings will fall short of expectations, said on Wednesday it will eliminate as many as 6,300 jobs, or 10 percent of its workforce, in a restructuring that will result in charges of between $300 million and $350 million in 2001.

The company, the world's largest appliance maker, said it plans to reduce operational expenses by $100 million over the next two years as part of a program to save $225 million to $250 million a year through cuts in spending and its global workforce of 63,000 people.

The company also said it expects earnings for the first six months of 2001 to be lower than those for the same period of 2000, but it said that could improve by the second half of 2001.

``The only thing that bothers me is that over the last 10 year, they've had about three of these big restructuring charges,'' said analyst Lawrence Horan of Parker Hunter Inc.

Horan said it blamed shortfalls earlier in the year on retailer Circuit City's (CC.N) decision to stop carrying certain types of home appliances, but Wednesday's fourth-quarter and 2001 warning means Circuit City's action cannot explain all of Whirlpool's problems.

``So now you have to wonder,'' Horan said.

The Benton Harbor, Mich.-based manufacturer said in a statement that fourth-quarter resultctions during the last several months, we continue to face industry and economic conditions that have led to intensified price competition, rising material costs, and slowing or declining demand,'' said Chairman and Chief Executive David Whitwam in the statement.

The statement added that the company expected the North American appliance industry market to decline 7 percent-8 percent in the fourth quarter compared with the same period a year ago. The company previously predicted a 2 percent to 3 percent decline.

The company said it does not expect to see an increase in North American shipments of its products in 2001 compared with 2000. The company said it expects European industry appliance shipments to grow 2 percent in 2001, and industry shipments in Latin America and Asia to grow by 5 percent-8 percent.

Analysts had originally predicted the company would earn $1.52 for the third quarter. Then on Aug. 30, Whirlpool said that U.S. pricing pressures, weaker-than-expected European demand, and the loss of retail outlet Circuit City would mean lower third-quarter earnings.

However, when Whirlpool reported third-quarter earnings Oct. 18, it said fourth-quarter results would exceed expectations. The company said it would earn between $1.45 and $1.55 per share for the fourth quarter.

Whirlpool is just the latest of a slew of major companies reliant on consumer spending to report that fourth-quarter sales would be lower than expected. Computer giants Compaq Computer Corp. (CPQ.N), Gateway Inc. (GTW.N), Apple Computer Inc. (AAPL.O) and Hewlett-Packard Co. (HWP.N) have all issued warnings.

Shares of the company closed on Wednesday at $44-3/16, off the 52-week high of $68-5/16 and up from a year-low of $34

http://www.siliconinvestor.com/headlines/financial/20001213/260167.html

-- Martin Thompson (mthom1927@aol.com), December 13, 2000