Maytag Corporation reported today that its third quarter earnings fell almost 80 percent from a year earlier as restructuring costs, higher steel prices and lower sales on Hoover floor care products have also taken a toll on the company.
The USA’s third largest manufacturer domestic appliances said its earned $7.5 million, or 9 cents a share, in the quarter, down from $36.6 million, or 46 cents a share, a year ago. Sales dropped to $1.19 billion from $1.22 billion from the same quarter last year.
The company, based in Newton, Iowa, USA reported a charge of 16 cents a share including $11.9 million for closing a refrigerator plant in Galesburg as previously reported as production was switched to Mexico and $7.2 million for an internal restructuring plan.
Maytag also warned that it expects to earn only 5 cents and 10 cents a share in the fourth quarter of 2004 after taking restructuring and other charges of about 10 cents a share. That is less than the 30 cents per share analysts had been expecting, excluding restructuring charges.
Maytag shares rose 30 cents to $16.11 in morning trading on the New York Stock Exchange. They had traded above $32 a share as recently as last April.
CEO Ralph Hake said today; “We are taking the right actions to improve Maytag’s performance going forward,” he said. “Our ‘One Company’ restructuring, which consolidates Hoover floor care, Maytag Appliances and corporate organizations, is on track for $150 million in annual savings and lowered our costs in the third quarter.”
Hake said the company’s new labour agreements at the Maytag-owned Amana refrigeration plant and sale of a venture in China will also help the company going forward.