Flooring giant Mohawk Industries posted fourth-quarter earnings of $66 million, or 95 cents per share, beating analysts' expectations by 7 cents and its prior year fourth-quarter earnings by $23 million.
Sales increased 4 percent to $1.44 billion during the quarter, up from $1.38 billion in the fourth quarter of the prior year. Allowing for costs associated with restructuring the company, the company would have earned $70 million, or $1.01 per share, a 40 percent increase from the fourth quarter of 2011.
"Price increases, productivity improvements, mix and lower interest all contributed to solid results for the period," said Jeff Lorberbaum, chairman and CEO of Mohawk. "In the U.S., low mortgage rates, stabilizing home prices and improving employment should sustain the housing recovery."
Mohawk grabbed headlines during the year with three large acquisitions -- Pergo, Marazzi and Spano -- none of which held the company back from posting net sales for the year of $5.79 billion and earnings of $250 million, or $3.61 per share. Sales in 2012 rose 3 percent, while earnings rose $76 million, according to Mohawk's press release.
Carpet and rug sales were flat during the fourth quarter, even including a 4.6 percent price increase to adjust for rising raw material costs. Tile sales, meanwhile, grew 15 percent during the quarter, as the company expanded its plant capacity. Laminate and hardwood sales grew more slowly, though the company began construction of a new manufacturing facility in France to support its growing insulation board business.
The company believes that the U.S. remodeling business will continue to improve, and that the European market has hit a bottom and will get better. The company expects to earn between 77 cents and 86 cents per share in the first quarter of 2013.
"We anticipate revenue growth for 2013 as the U.S. market improves and we realize some benefits from recent acquisitions," Lorberbaum said.
Mohawk's stock closed Thursday at $102.21 per share, down $1.29 or 1.25 percent.
Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...