Mohawk’s Q3 Sales Up 2%, Earnings Up 31%
Calhoun, GA, October 30, 2020-Mohawk reported Q3 2020 net sales of $2.6 billion, an increase of 2% compared to Q3 2019 net sales of $2.5 billion. Net earnings were $205 million in Q3 2020, a 31% increase compared to Q3 2019 net earnings of $156 million.
For the nine months ending September 26, net sales were $6.9 billion, a decline of 8% compared to $7.5 billion in the prior year period. Net earnings for the first nine months of 2020 were $267 million, a 45% decline compared to $480 million in the prior year period.
For Q3 2020, Global Ceramic Segment sales were $911 million, compared to $916 million in Q3 2019, a 1% decline. The company reports, “All of our ceramic businesses improved substantially in the third quarter with low inventories limiting both our sales and service. Most of our plants have staffed up to run all of their capacity to meet present demand and increase inventories in the fourth quarter. In the U.S., we are seeing increased traffic in our showrooms and galleries as well as at our customers’ retail shops. We have shifted sales focus from commercial to new home construction, which is expected to increase through next year. Commercial sales improved from the prior period but are still lagging.”
During the quarter, Flooring North America Segment’s sales decreased 2%, from $1.0 billion in Q3 2019 to $982 million in Q3 2020. “Our residential carpet business improved with retail remodeling and polyester products outperforming,” the company reports. “To cover higher costs, we are implementing price increases in the market. Our rug sales increased as consumers used them as an easy way to update their home décor. During the period, laminate had strong growth, with expanding distribution and sales in all channels. To increase our laminate production and provide new features, we are installing a new line that should begin production in the fourth quarter of next year. Sales of our residential LVT collections continued to expand at a rapid pace, with rigid products increasing their share and our new product launches improving our mix. To offset higher tariffs on our sourced collections, we implemented price increases in the period. Our sheet vinyl collections continue to take market share, and our costs in the category improved due to greater efficiencies.”
For the quarter, Flooring Rest of the World Segment’s sales increased 13%, from $600 million in Q3 2019 to $681 million in Q3 2020. “During the period, the segment outperformed since the majority of its sales are in northern Europe, where commerce was less affected by the pandemic and has less participation in commercial end markets,” the company says.
Commenting on Mohawk Industries’ third quarter performance, Jeffrey S. Lorberbaum, chairman and CEO, says, “Our results in the period significantly exceeded our expectations, with sales recovering and operating income substantially increasing above last year’s levels. Under continued pandemic conditions, people all over the world are spending more time in their homes and working remotely. Globally, this trend is increasing investments in home remodeling as well as driving new home purchases.
In addition, Mohawk’s board of directors approved a $500 million share repurchase plan.
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