Acquisition Boosts Mohawk Results
Carole Sloan -- Home Textiles Today, May 1, 2006
Calhoun, Ga. — Getting a big assist from last year's purchase of a Belgian flooring producer, Mohawk Industries recorded a first quarter profit of $71.1 million, up from $70.0 million.
Earnings would have been even higher but for a $3.0 million non-cash charge for stock options that was not required last year, and a $14.0 million non-cash inventory charge. The diversified floor covering and home textiles producer.
Boosted by Unilin, which brought in $302.6 million during the first three months of the year, Mohawk sales jumped up by 28.9%, to $1.9 billion from $1.5 billion last year. Mohawk's Dal-Tile business yielded a 17.9% increase in sales and a 19.0% boost in operating profit.
But the core U.S. floor coverings business did less well. Sales increased by 5.4%, to $1.2 billion, but operating profit fell off by 20.3%, to $52.3 million, hurt by slowing sales growth and weaker margins in the residential replacement carpet business.
Wall Street liked the news it heard, and in the hours after Mohawk released its numbers, its share price climbed by 2.5%, or $1.97 a share, to $78.82.
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