Interface Reports First Quarter 2019 Results
Atlanta -- Interface, Inc. recently announced results for the first quarter ended March 31, 2019.
"We started off 2019 with another solid quarter, in line with our expectations. We continue to deliver on our value creation strategy and remain on track to achieve our 2019 objectives," said Jay Gould, CEO of Interface. "First quarter organic sales were up 2% as anticipated. The marketplace response to our Carbon Neutral Floors program has been very positive, allowing us to take share in carpet tile in key markets and drive growth in LVT. The integration of nora systems into the Interface family is generating promising results with nora rubber flooring sales up 9% in local currency versus the prior year period. Our strategic investment in nora, the transformation of our selling system, and advancements in our manufacturing capabilities are successfully fueling growth. Overall, we delivered adjusted EPS of $0.14."
First quarter net sales were $298 million, up 24% versus $241 million in the prior year period. Organic sales were up 2% year-over-year. Nora contributed $60 million of net sales in the quarter, up 9% in local currency compared to the stand-alone business in first quarter of 2018.
First quarter operating income was $16 million, compared with $23 million in the prior year period. First quarter 2019 adjusted operating income was $18 million. Gross profit margin was 38.8% in the first quarter, which included $2 million of nora purchase accounting amortization. Adjusted gross profit margin was 39.4%, an increase of 50 basis points over gross margin for the prior year period. First quarter SG&A expenses were in line with expectations at $99 million, or 33% of sales.
The company recorded net income in the first quarter of 2019 of $7 million, compared to first quarter 2018 net income of $15 million. First quarter 2019 adjusted net income was $8 million. In the first quarter of 2019, adjusted EBITDA was $31 million compared to $34 million in the prior year period.
Looking ahead to the full year of 2019, Interface is targeting to achieve: total net sales growth, including nora, of 14-16%, which includes 200 basis points of currency headwinds; organic sales growth from carpet and LVT of 2-4%; adjusted gross profit margin of 40-40.5%; and adjusted SG&A expenses of 28-28.5% as a percentage of net sales. Capital expenditures for the full year are forecasted to be $65 million to $75 million. For the remaining portion of the year, the company anticipates adjusted EPS to be spread relatively evenly in the second, third and fourth quarters.
For more information, visit www.interface.com.