Maytag Misses Second Quarter

Sales are flat and earnings are hit by restructuring charges and higher fuel costs.
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Maytag

(MYG)

continued to struggle Friday, missing Wall Street's earnings targets with a lukewarm second-quarter performance.

The news came a day after the company rejected a buyout bid from rival

Whirlpool

(WHR) - Get Report

, saying it was "unable to determine that the Whirlpool Corporation proposal announced on July 17 may reasonably be expected to lead to a financially superior transaction that is reasonably capable of being completed." Maytag said it would continue to recommend its merger pact with private equity buyer Ripplewood, though it would also "evaluate the Whirlpool proposal."

For its second quarter ended July 2, Maytag earned $3.5 million, or 4 cents a share, reversing the year-ago loss of $41 million, or 52 cents a share. Latest-quarter earnings were reduced to the tune of 3 cents a share by restructuring charges, but the results still fell 3 cents short of the Wall Street analyst consensus estimate. Sales were flat at $1.15 billion, matching the analyst estimate.

"Compared to last year, operations benefited from sales growth, a positive mix in major appliances, and savings from our 'One Company' restructuring and the Galesburg plant closing," said CEO Ralph Hake. "However, these improvements were offset by rising raw material costs including steel and resins, higher fuel and transportation costs and lower floor care pricing."

The company also guided to 2005 earnings of 45 to 55 cents a share, including a dime a share worth of restructuring charges. Wall Street was looking for 54 cents.

The news comes as the Newton, Iowa, washing machine maker remains the object of interest from several parties. Maytag was catapulted into the headlines this summer as its sinking results hammered its shares, leading to bids from potential buyers including China's Haier. But a group led by that company soon dropped out of the competition amid questions about its margins and hand-wringing over the prospect of a proud American laundry brand falling into the hands of a foreign power.

Early Friday, Maytag was flat at $15.65.