May 10 2007
Mohawk Industries Inc (Calhoun, GA, USA) – parent company of tile giant Dal-Tile – has announced 2007 first quarter net earnings of US$90 million and diluted earnings per share (EPS) of US$1.32, both 14% above last year.
In commenting on the first quarter results, Jeffrey Lorberbaum, Chairman and CEO, stated: "The first quarter results were better than we had anticipated and exceeded our estimate. The U.S. flooring business remains slow, however comparisons to the prior year, when the industry slowed down, will be easier in the second half of 2007. The residential business remains challenging in all product categories reflecting softness in both the new and remodeling businesses. Commercial sales are outperforming the rest of the business and are expected to continue throughout this year. In the U.S., we are managing our costs and improving productivity while still maintaining investments in products, marketing and assets. All businesses are managing their inventory levels, expenses and production schedules to adapt to the current industry downturn. The European economy maintained its positive trend and appears to have good momentum. The improved economic conditions in Europe allowed us to pass through rising material and energy costs".
The Dal-Tile segment sales were down 2% in the quarter. Earlier investments minimised some of the declining sales trends affecting the entire industry. Commercial is still growing and is expected to be strong throughout the year. The company is reducing its outsourced ceramic tile purchases to offset slower sales. It has opened new galleries in New York City and Chicago and a stone centre in Atlanta to strengthen its position in these markets. All have been favourably received by customers, reports the company.