Forbo Reports Decline in First Half Earnings

Baar, Switzerland, Aug. 16, 2011 -- The Forbo Group reported first half net income from operations of $66.1 million, a decrease of 11.1% versus the prior-year period.

The firm reported sales of $1.1 billion in the first half of 2011, which equates to growth of 8.8% in local currencies versus the prior-year period.

After adjustment for currency effects, though, this represents an increase of 6.1%.

The first half of 2011 was impacted by the strong Swiss franc and by further rises in raw material prices, Forbo said.

The Flooring Systems division reported net sales of $529.9 million in the first half of 2011, an increase of 4.7% in local currencies versus the same period the previous year.

Forbo said there are two reasons for the muted sales growth. It said the division has not yet fully exploited the distribution synergies of the expanded product portfolio from the acquisition of Bonar Floors about two years ago.

Also, public spending on hospitals, schools, and other public buildings is being curtailed in view of government debt levels.

Forbo said that generally America and Asia posted strong sales growth, while demand in Europe was mixed.