Tarkett Reports 2.1% Organic Growth in 2018
Paris La Défense, France -- Tarkett Group reported overall net sales decrease of 0.2% in 2018, with organic growth up 2.1%. Organic growth in North America rose 1.3% in 2018, although sales decreased by 2.2% in Q4.
The slowdown in North America was caused by lower sales in the commercial carpet market and difficulties at two production sites in the second half, which affected the product deliveries, the company said in a statement. Selling prices were increased throughout the year and specific measures taken in Q3 to fully offset the increase in customs duties on imports from China.
“Tarkett achieved good organic growth in 2018 despite a challenging environment in CIS countries,” said Fabrice Barthélemy, CEO. “Increases in selling prices offset almost half of the adverse effect of raw materials and transportation costs. The integration of Lexmark is moving forward as expected. We are confident that we will quickly achieve the planned synergies. In the short term, we are focusing our efforts on reducing costs, managing selling prices and maintaining a highly disciplined approach to cash management. In order to achieve a sustainable improvement in the financial performance of the group, we have launched a transformation plan focused on innovation in our products and solutions, optimization of our industrial set-up, digital transition and our continued commitment to circular economy. We will detail the initiatives taken in these different areas in a new strategic plan to be presented next June.”
In North America, sales of commercial and residential resilient flooring remained buoyant throughout the year, as did sales of accessories and rubber. Sales of luxury vinyl tiles (LVT) continued to grow at a good pace. The company said the economic growth outlook for 2019 is more moderate than in 2018. The North American residential market and new build activity in Europe are showing signs of slowing.
For more information, visit www.tarkett.com.