Our consistent and disciplined execution of the actions we laid out resulted in four straight quarters of year-over-year ongoing business operations margin improvement in 2012.

• Revenues were up approximately 3 percent — excluding the impact of foreign currency and BEFIEX tax credits — as our strong price and mix continued throughout the year.
• Our underlying cash flow generation from ongoing business operations improved by more than $550 million.
• $155 million was returned to our shareholders during the year through dividends.

These results underscore the success we can achieve when we focus on the key drivers we control. As in prior years, 2012 brought external challenges. We faced negative demand in North America, Europe and Asia. In addition, raw material costs were more than $300 million higher; inflation climbed to double digits in emerging markets; and we had severe currency devaluation in our key markets of Brazil and India. The 68,000 people of Whirlpool Corporation responded with great execution and a dedication to deliver on our performance commitments. For our people, it is about our core value of Integrity — doing what we say we will do. It’s that simple.

During the year, we successfully implemented cost-based price increases and drove a favorable mix of products in the marketplace. The restructuring actions we announced in 2011 remain on track to deliver $400 million in total program fixed-cost savings by the end of 2013. Our legacy legal liabilities are now largely behind us, and our strong underlying cash generation resulted in a $1.2 billion cash balance at the end of the year. The cash generation, combined with promising trends in U.S. housing and growth opportunities in emerging markets, created positive momentum going into 2013.

INNOVATION, GROWTH AND LEADERSHIP

The company continued to be recognized for its product leadership in 2012, receiving top ratings from leading consumer product evaluation groups. We will accelerate our actions in 2013, with higher investments in product development, technology and marketing in every region and for every product category. These investments begin with innovation that meets consumers’ needs, and then focuses everything we do to produce iconic, winning brands and products that consumers want in their homes.

We know that we can best compete by focusing on introducing new and innovative products, building strong brands, continuing to expand globally, increasing our margins and improving our cost structure. Our growth opportunities include expansion into emerging markets in Latin America, the Middle East and Asia. In Latin America, for example, our business outside the Brazilian market is producing record sales and operating profit. To capitalize on this growth, we accelerated the launch of Whirlpool brand kitchen collections in 2012, and we will introduce a strong cadence of new products throughout our Latin America Region in 2013.

We are also continuing investments in higher-margin, faster-growing adjacent businesses, such as water filtration and small appliances. In 2012, we introduced new countertop appliances and accessories in Latin America, Europe and the United States, with additional launches targeted for 2013. At the same time, we maintained investments in our core appliance business to push the innovation that is fundamental to our growth. For example, in 2012 we introduced the Whirlpool brand Ice Collection, appliance suites with advanced innovation and design elements that were created based on the ways consumers intuitively use their appliances and expect them to fit in easily with their busy lifestyles.

These investments will position us well to succeed on a level competitive playing field that rewards investments in innovation, employees and manufacturing. As we begin 2013, we have appropriately set the bar for the future by promoting a fair trade environment in the United States, with the U.S. government voting to impose trade remedies on imports of unlawfully traded washers from South Korea and Mexico. This decision is a great victory for the U.S. appliance industry, and it is an important stride toward enforcing laws that enable a balanced competitive marketplace for manufacturers, their employees and consumers.

PRIORITIES FOR SUSTAINABLE SUCCESS

We will continue to deliver the highest levels of performance execution and build on the momentum of 2012. Our 2013 operating priorities of Winning Products | Winning Performance | Winning People will be crucial to our success and will support the achievement of our long-term growth strategy through:

• Appliance ownership growth in new and emerging markets
• Increased investments in our consumer-relevant product innovations
• Growth in our higher-margin adjacent businesses
• Continued cost- and capacity-reduction initiatives
• Advancing our global product leadership

Our ability to move our business forward with focus, consistency, discipline and speed will strengthen our industry leadership this year and in the years to come. We are encouraged by positive global trends that will allow us to gain better traction from our actions. We see structural demand growth returning in the U.S., our largest market, driven by improving housing starts, a modest return in discretionary spending and accelerated appliance replacement, based on typical usage cycles. Growth opportunities in emerging markets are also expanding, with low appliance penetration levels in key regions and strong underlying fundamentals. Our target of 8 percent operating margins by 2014 is well within our reach, as we further improve the mix of innovative new products, broaden our higher-margin adjacent businesses, continue executing our cost- and capacity-reduction programs and maintain cost productivity.

In 2013, we will continue to make progress on our roadmap for growth with great brands that bring leading consumer-relevant innovation into consumers’ homes through outstanding products. This map is a proven course for our sustained success, framing the positive performance we expect and creating long-term value for our shareholders.

At Whirlpool, we have only seen the beginning of our return to value-creating results. We believe that the best is yet to come as we work together, evolving into a leading global branded consumer-products company.

Sincerely,