Interface reports third quarter results
For the third quarter of 2001, the company reported net income of $0.7 million, or $0.01 per diluted share, before a non-recurring restructuring charge, and sales of $263 million, compared with third quarter 2000 net income of $9.8 million, or $0.19 per diluted share, and sales of $336.7 million.
Operating income for the third quarter of 2001 was $10.7 million, excluding the one-time restructuring charge, versus $25.2 million in the same period a year ago.
In the third quarter, Interface recorded a pre-tax restructuring charge of approximately $62 million, primarily attributable to exiting European broadloom and rationalizing American broadloom and access flooring businesses. Including the charge, the net loss for the third quarter of 2001 was $41.3 million.
Revenue and profit levels in the company's domestic modular business remained healthy, despite the downturn in the commercial interiors sector. Interface attributes this segment's performance to the company's leading position in modular carpet offerings and to market share gains carpet tile has made in the overall floorcoverings market. Nevertheless, carpet tile sales in Europe and Asia-Pacific softened in the aftermath of Sept 11.
Profitability in the company's domestic broadloom operations improved from the second quarter of 2001, primarily due to lower raw material costs, stabilized energy prices and the realization of increased manufacturing efficiencies resulting from steps taken over the past year to rationalize that business.
Revenue in the company's U.S. broadloom and U.S. access flooring businesses declined moderately in the third quarter, due to industry conditions. The interior fabrics segment showed signs of stabilizing, as order and billing trends remained consistent with those of the second quarter of 2001. Re:Source Americas, the Company's floorcoverings dealer network, maintained break-even performance on sales declines in line with industry declines.
Including the third quarter restructuring charge, reported net loss for the first nine months of 2001 was $35.6 million.