Armstrong Flooring Reports Second Quarter 2019 Results
Lancaster, Pa. -- Armstrong Flooring recently reported financial results for the second quarter ended June 30, 2019.
“Adjusted EBITDA margin improved in the quarter despite challenging end market demand across our industry, including the winding down of elevated channel inventory levels," said Larry McWilliams, chairman and interim CEO. "We remain committed to investing in our products, people and operations to improve our position with customers. The strength of our balance sheet provides us with the flexibility to continue executing against that objective while capitalizing on value enhancing opportunities.”
In the second quarter of 2019, net sales decreased 11.7% to $177.7 million from $201.2 million in the second quarter of 2018, including an adverse currency impact of 110 basis points. The decrease in net sales was primarily due to lower volumes and mix, marginally offset by modest price realization in response to tariff related inflationary pressures. Lower volumes in the second quarter of 2019 reflected relative changes in distributor inventory and overall soft end-market demand, particularly in our residential categories. Inventory levels in the distributor channel decreased sequentially compared to the first quarter 2019 but remained moderately elevated at the end of the quarter.
Net income in the second quarter of 2019 was $14.7 million, or diluted income per share of $0.56, as compared to a net income of $10.5 million, or diluted income per share of $0.40, in the prior year quarter. Adjusted net income was $9.4 million, or adjusted diluted income per share of $0.36, as compared to an adjusted net income of $7.8 million, or adjusted diluted income per share of $0.30, in the prior year quarter.
Second quarter 2019 adjusted EBITDA was $20.0 million, as compared to $20.7 million in the prior year quarter. The decrease in adjusted EBITDA was primarily attributable to lower net sales, partially offset by lower selling, general and administrative expenses and improved productivity.
For the full year 2019, the company has moderated its expectation for adjusted EBITDA, which it now anticipates to be in the range of $46 million to $54 million, primarily attributable to a continuation of soft end-market conditions. Armstrong continues to expect capital expenditures to be approximately $30 million for the full year 2019 and expects to build cash from operations over the remaining quarters.
For more information, visit www.armstrongflooring.com.