Mohawk Q4 Net Income More Than Doubles

Calhoun, GA,  Feb. 22, 2011  -- Mohawk Industries reported fourth quarter net earnings of $46 million and diluted earnings per share of $0.66.

Its adjusted results met analysts' expectations, but the sales figures fell short of estimates. It also gave first-quarter profit guidance below analysts' expectations.

For the fourth quarter of 2009, the net earnings were $20 million and earnings per share were $0.29.

Excluding unusual items, 2009 fourth quarter net earnings and EPS were $39 million and $0.56 per share.

Net sales for the quarter were $1.3 billion, which was a decrease of approximately 6% versus 2009. Net sales for the quarter increased 2% over the prior year on a constant days and exchange rate basis.

For the full year, net earnings were $185 million, compared to a net loss $5 million in 2009.

Net sales for the full year of 2010 were $5.3 billion, representing a slight decrease from 2009.

"Our earnings exceeded our expectations as results were positively impacted by enhanced manufacturing efficiencies, benefits from restructuring actions, reducing SG&A costs and improved process consistency," said CEO Jeffrey S. Lorberbaum.

"Our operating margin of 6.8% continues to show improvement compared to last year despite rising raw material costs. During 2010, our emphasis on innovation, new products, manufacturing improvements and cost reduction have benefited our margins and increased earnings. Investments in the Russian, Chinese and Mexican flooring markets are expanding our international presence and will provide platforms for future revenue and profit growth. The consensus among economists is that these markets will outperform the more mature U.S. and Western European flooring markets. The U.S. industry decline experienced over the past few years appears to have bottomed with some markets showing signs of improvement."

Mohawk segment net sales decreased 3% but achieved the highest operating margin in two years despite increasing raw material costs, the company said. 

Mohawk implemented a 7-10% carpet price increase in February to offset raw material inflation.

Dal-Tile segment net sales declined 4% as reported but increased 4% after adjusting for the lower number of days in the quarter.

Unilin revenues were flat in the period as reported, but increased 14% after adjusting for the number of days in the period and the exchange rate.

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Related Topics:Daltile, Mohawk Industries