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[February 2007]
Mohawk Industries Announces Fourth Quarter Earnings
Mohawk Industries Inc (Calhoun, GA, USA) has announced 2006 fourth quarter net earnings of US$129.5 million (30% above last year) and diluted earnings per share (EPS) of US$1.90 (29% above last year). The 2006 fourth quarter net earnings include US$3.3 million in closing costs for a ceramic plant, US$1.8 million for stock options charges not required in the prior year and income of US$2.8 million for a partially paid customs refund, all net of taxes. Net sales for the quarter were US$1.898.6 billion, an increase of 5% from 2005. The sales growth resulted from the Unilin acquisition (completed 31 October 2005), hard surfaces sales growth and price increases.In commenting on the ceramic products part of the group, Jeffrey Lorberbaum, Chairman and CEO said: "Our Dal-Tile segment sales grew 4% during the quarter despite a deteriorating residential market. Dal-Tile is following industry trends with residential sales slowing and commercial sales growing. We are reducing expenses, increasing productivity, and focusing on the commercial and redecorating channels. Our plant expansions were completed and will enhance our position. Margins were impacted by the closing of a high cost ceramic facility and higher transportation costs. Our ceramic business is well positioned for the long-term".
The company is anticipating continued slow U.S. industry sales in the first quarter of 2007 that will impact margins and earnings. It has reduced manufacturing, administration and marketing expenses based on current industry conditions and will continue to adjust as required. Based on these factors, earnings guidance for the first quarter of 2007 is from US$1.01 to US$1.10 EPS. This guidance includes refunds of approximately US$5 million received from U.S. customs in January 2007.
www.mohawkind.com
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