Mohawk Reports 1Q Results
Calhoun, Ga. -- Mohawk Industries reported net sales for the first quarter of 2019 were $2.44 billion, up 1% in the quarter compared to the same period last year. First quarter net earnings were $122 million.
Commenting on Mohawk Industries’ first quarter performance, Jeffrey S. Lorberbaum, chairman and CEO, said: “In the first quarter, we delivered results in-line with the high end of our expectations despite economies weakening in most regions and a stronger U.S. dollar, reducing our translated results. While U.S. housing markets began softer and higher inputs increased costs, both are showing signs of improvement as we enter the second quarter. Around the world, uneven demand impacted volume, increasing pressure on both price and mix. We reduced our production rates to balance our inventories with our customers’ demand and manage our working capital. Results from our recent acquisitions in Australia, New Zealand and Brazil are on track, and we remain optimistic about our ability to improve their market positions and costs.”
During the quarter, Flooring North America Segment’s sales decreased 3%. The company reported income for the segment declined due to lower volume, inventory reductions, high material costs and LVT manufacturing variances. The segment’s business improved as it moved into the second quarter, supported by higher retail activity and an improving housing environment.
“Our new ColorMax technology that blends earth tones was voted the best carpet innovation at the national trade show,” Lorberbaum said. “The carpet price increases we have implemented are being partially offset by declining product mix. Our commercial business improved during the quarter due to new product launches and channel segmentation. Our recent investments in advanced laminate manufacturing technology are allowing us to expand our market and upgrade our mix. Our LVT continues to grow substantially, and we have a complete offering with different features under our key brands. We have replaced high-cost assets and are consolidating five operations and two warehouses, which will reduce our overhead and cost structure. We are enhancing planning strategies, increasing production output and reducing process variations to facilitate this realignment.”
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