Mohawk Industries reported a second-quarter loss of $48.3 million, after reporting a profit in the same period a year earlier.
On a per-share basis, the company said it had a loss of 68 cents. Earnings, adjusted for one-time gains and costs, came to 37 cents per share.
Commenting on Mohawk Industries’ second quarter performance, Chairman and CEO Jeff Lorberbaum stated:
“Though sales trends have improved significantly since government restrictions were lifted, the current environment is the most unpredictable in the history of our business. During the quarter, all of our businesses were dramatically impacted, with most of our customers and facilities operating either in a limited capacity or completely shut down for some time. After the company’s sales bottomed in April, our markets improved more than we expected, and shipments exceeded our production rates, reducing our inventories. Our manufacturing levels were impacted by government restrictions, Covid disruptions and employee absenteeism across the enterprise. At this time, our visibility into the future continues to be uncertain due to the persistent Covid spread and the unknown strength of the economic recovery. Some near-term factors represent a potential upside, including historically low interest rates, rising remodeling activity, consumer discretionary funds being shifted to home improvements and increasing home purchases. Alternately, potential changes in government policies, consumer and business spending and higher Covid infection rates could reduce demand around the world, particularly if governments increase restrictions. Given these factors, our business plans must remain flexible to quickly adjust our production levels.”
During the quarter, the company reported the Flooring North America Segment’s sales decreased 19% primarily due to lower volume and shutdowns due to the pandemic. Lorberbaum reported the company is taking out higher cost manufacturing assets and consolidating distribution points, streamlining product offering and investing in more efficient assets to reduce costs. As LVT sales improved in the quarter, the company increased production and upgraded its LVT offering. In residential carpet, the new home construction channel performed best with housing sales and starts improving through the period. The mix and pricing declined as the higher value remodeling channel was more impacted and lower priced polyester performed better. The commercial sector continues to be challenged, as many businesses are postponing new investments. The business was impacted as customers were completely shut down, but the business has rebounded. Mohawk’s laminate business outperformed other categories as consumers increased DIY and remodeling projects while at home.
For more information, visit mohawkind.com.