CALHOUN, Ga., Feb. 20,
2014 /PRNewswire/ -- Mohawk Industries, Inc. (NYSE: MHK) today
announced 2013 fourth quarter net earnings of $95 million and diluted earnings per share (EPS)
of $1.29. Excluding unusual charges
and discontinued operations, net earnings for the quarter were
$131 million and EPS was $1.79, a 77% increase over last year's fourth
quarter adjusted EPS. Net sales for the fourth quarter of 2013 were
approximately $1.9 billion, an
increase of 34% versus the prior year's fourth quarter or 33% on a
constant exchange basis. For the fourth quarter of 2012, net sales
were approximately $1.4 billion, net
earnings were $66 million and EPS was
$0.95; excluding unusual charges, net
earnings were $70 million and EPS was
$1.01.
For the twelve months ending December 31,
2013, net sales were approximately $7.3 billion, an increase of approximately 27%
versus the prior year or 26% on a constant exchange basis. Net
earnings and EPS for the twelve month period were $349 million and $4.82, respectively. Excluding unusual charges
and discontinued operations, net earnings were $473 million and EPS was $6.55, an increase of 73% over the twelve month
adjusted EPS results in 2012. For the twelve months ending
December 31, 2012, net sales were
approximately $5.8 billion, net
earnings were $250 million and EPS
was $3.61. Excluding unusual charges,
net earnings and EPS were $262
million and $3.78,
respectively.
Commenting on Mohawk Industries' fourth quarter performance,
Jeffrey S. Lorberbaum, Chairman and
CEO, stated, "Our fourth quarter results were better than projected
primarily as a result of higher top-line growth in our U.S. ceramic
business, a strong performance from our Pergo acquisition and lower
interest expense due to an upgrade in our credit rating. Our legacy
net sales increased approximately 6% as reported, with additional
revenue growth from our recent acquisitions. As a result of
improved product mix, increased productivity and SG&A
management, our adjusted operating income for the quarter rose 260
basis points from last year to approximately 10% of net sales and
for the year improved by 250 basis points to 9.4% of net sales. We
believe we are well positioned for both revenue and earnings growth
in 2014."
Carpet segment net sales for the quarter were $747 million, up 3% over last year, primarily due
to strong performances of the Company's ultra-soft residential
products and expansion of the polyester product line. Adjusted
SG&A decreased both as a percentage of net sales as well as
total expenses from cost reductions and improved execution. The
segment's operating margins, excluding unusual charges, for the
quarter were approximately 9% of net sales, an increase of 160
basis points from increased volumes, productivity gains, cost
reduction and improved product mix. In residential, increased
premium carpet sales improved our product mix, and polyester
product sales rose substantially as our Continuum introductions
gained traction across all channels. In commercial, margins
expanded due to new product introductions and the use of
performance fibers that enhance our value proposition. Productivity
gains are positively impacting our margins, and we lowered costs
through reduced changeover costs and waste, enhanced manufacturing
alignment, quality improvements and material optimization.
Ceramic segment net sales for the quarter were $738 million, up 84% compared to the prior year,
with strong growth from the Dal-Tile business and the Marazzi
acquisition. During the period, operating margins, excluding
unusual charges, grew 320 basis points to 10% of net sales as a
result of higher volumes, efficiency gains and improved product
mix. In the U.S., the integration of Dal-Tile and Marazzi has been
completed, resulting in new collections with enhanced style and
design as well as improved technologies across the business. In
Mexico, the Company's ceramic
business is increasing distribution, enhancing product mix and
improving margins. In Russia,
sales benefited from expanded participation in the new construction
and home center channels, supported with unique products and
dedicated sales teams. Restructuring the Company's ceramic business
in Europe reduced cost structures,
improved the sales organization through a geographic realignment
and decreased manufacturing complexities.
Laminate and wood segment net sales for the quarter were
$466 million, up 41% over last year,
with most of that increase from growth in the U.S. and the
acquisitions of Pergo and Spano. Operating margins, excluding
unusual charges, were approximately 12% of net sales, up 260 basis
points over the prior year due to lower SG&A, higher volume in
North America and reduced
amortization. The Unilin and Pergo laminate businesses have been
fully integrated, reducing SG&A and improving operational
efficiencies. The segment's U.S. wood business grew significantly
during the quarter along with new home sales. Legacy European sales
were about flat with the prior year on a local basis. Laminate
flooring was down slightly in Europe, offset by growth in luxury vinyl tile
(LVT). Construction of the Company's new LVT facility in
Europe is underway, with
production scheduled to commence by the end of 2014. All of Spano
and Unilin's administrative and sales functions have now been
consolidated. A Spano manufacturing facility was closed during the
quarter and production was shifted into other operations.
"Through investments in acquisitions and capital expenditures,
productivity improvements and product innovation, we have
positioned Mohawk for growth and improved profitability in all
segments during 2014," said Lorberbaum. "We have made excellent
progress with integrating our acquisitions to maximize their market
positions and improve their cost structures. In the U.S., Mohawk is
the largest flooring provider with significant shares of the
carpet, ceramic, laminate, wood, stone, rug and carpet underlay
markets. We are well positioned to improve our results as new
construction and remodeling expand in both the residential and
commercial categories. In Europe,
we continue to lower our cost structure, enhance productivity and
improve our product offerings to position the Company for future
growth as the industry improves from its cyclical bottom. This
year, we anticipate growing both our sales and margins in our
legacy businesses and recent acquisitions. We continue to assess
additional acquisition opportunities in flooring products around
the world to further expand the business. With these factors, our
guidance for first quarter earnings is $1.13
to $1.19 per share, excluding any restructuring charges. Our
first quarter results are seasonally our lowest and in the past
four years represented about 1/7th of our total annual
earnings. While the weather in the first half of this quarter has
impacted the timing of some of our U.S. orders and shipments, our
first quarter results are expected to be in line with normal
seasonal patterns. We anticipate orders improving and our backlog
declining, limiting the impact on the quarter.
"We are optimistic about the future of the flooring industry and
our participation in it. This year, we anticipate increasing
capital investments in our businesses to support additional growth,
expand our product offerings and reduce costs. We will continue
driving all aspects of our business to improve profits and increase
shareholder value."
Mohawk Industries is the leading global flooring manufacturer
that creates products to enhance residential and commercial spaces
around the world. Mohawk's vertically integrated manufacturing and
distribution processes provide competitive advantages in the
production of carpet, rugs, ceramic tile, laminate, wood, stone and
vinyl flooring. Our industry-leading innovation has yielded
products and technologies that differentiate our brands in the
marketplace and satisfy all remodeling and new construction
requirements. Our brands are among the most recognized in the
industry and include American Olean, Bigelow, Daltile, Durkan,
Karastan, Lees, Marazzi, Kerama Marazzi, Mohawk, Pergo, Unilin and
Quick-Step. During the past decade, Mohawk has transformed its
business from an American carpet manufacturer into the world's
largest flooring company with operations in Australia, Brazil, Canada, China, Europe, India, Malaysia, Mexico, Russia and the United States.
Certain of the statements in the immediately preceding
paragraphs, particularly anticipating future performance, business
prospects, growth and operating strategies and similar matters and
those that include the words "could," "should," "believes,"
"anticipates," "expects," and "estimates," or similar expressions
constitute "forward-looking statements." For those statements,
Mohawk claims the protection of the safe harbor for forward-looking
statements contained in the Private Securities Litigation Reform
Act of 1995. There can be no assurance that the
forward-looking statements will be accurate because they are based
on many assumptions, which involve risks and uncertainties. The
following important factors could cause future results to differ:
changes in economic or industry conditions; competition; inflation
in raw material prices and other input costs; energy costs and
supply; timing and level of capital expenditures; timing and
implementation of price increases for the Company's products;
impairment charges; integration of acquisitions; international
operations; introduction of new products; rationalization of
operations; tax, product and other claims; litigation; and other
risks identified in Mohawk's SEC reports and public
announcements.
Conference call Friday,
February 21, 2014 at 11:00 AM Eastern
Time
The telephone number is 1-800-603-9255 for
US/Canada and 1-706-634-2294 for
International/Local.
Conference ID # 31815143. A replay will be available until
Wednesday, March 5, 2014 by dialing
1-855-859-2056 for US/local calls and 1-404-537-3406 for
International/Local calls and entering Conference ID #
31815143.
MOHAWK INDUSTRIES,
INC. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Statement of Operations
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
(Amounts in
thousands, except per share data)
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
1,924,104
|
|
1,435,659
|
|
7,348,754
|
|
5,787,980
|
|
Cost of
sales
|
|
1,411,307
|
|
1,066,328
|
|
5,427,945
|
|
4,297,922
|
|
Gross
profit
|
|
512,797
|
|
369,331
|
|
1,920,809
|
|
1,490,058
|
|
Selling, general and
administrative expenses
|
|
361,809
|
|
273,471
|
|
1,373,878
|
|
1,110,550
|
|
Operating
income
|
|
150,988
|
|
95,860
|
|
546,931
|
|
379,508
|
|
Interest
expense
|
|
22,148
|
|
15,402
|
|
92,246
|
|
74,713
|
|
Other expense,
net
|
|
2,656
|
|
1,366
|
|
9,114
|
|
303
|
|
Earnings from
continuing operations before income taxes
|
|
126,184
|
|
79,092
|
|
445,571
|
|
304,492
|
|
Income tax
expense
|
|
15,420
|
|
12,703
|
|
78,385
|
|
53,599
|
|
Earnings from
continuing operations
|
|
110,764
|
|
66,389
|
|
367,186
|
|
250,893
|
|
Loss from
discontinued operations, net of income tax benefit of $268 and
$1,050
|
|
(15,981)
|
|
-
|
|
(17,895)
|
|
-
|
|
Net earnings
including noncontrolling interest
|
|
94,783
|
|
66,389
|
|
349,291
|
|
250,893
|
|
Net earnings
attributable to noncontrolling interest
|
|
132
|
|
-
|
|
505
|
|
635
|
|
Net earnings
attributable to Mohawk Industries, Inc.
|
|
$
94,651
|
|
66,389
|
|
348,786
|
|
250,258
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share attributable to Mohawk Industries, Inc.
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
|
$
1.52
|
|
0.96
|
|
5.11
|
|
3.63
|
|
Loss from
discontinued operations, net of income taxes
|
|
(0.22)
|
|
-
|
|
(0.25)
|
|
-
|
|
Basic earnings per
share attributable to Mohawk Industries, Inc.
|
|
$
1.30
|
|
0.96
|
|
4.86
|
|
3.63
|
|
Weighted-average
common shares outstanding - basic
|
|
72,654
|
|
69,095
|
|
71,773
|
|
68,988
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per share attributable to Mohawk Industries, Inc.
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
|
$
1.51
|
|
0.95
|
|
5.07
|
|
3.61
|
|
Loss from
discontinued operations, net of income taxes
|
|
(0.22)
|
|
-
|
|
(0.25)
|
|
-
|
|
Diluted earnings per
share attributable to Mohawk Industries, Inc.
|
|
$
1.29
|
|
0.95
|
|
4.82
|
|
3.61
|
|
Weighted-average
common shares outstanding - diluted
|
|
73,214
|
|
69,536
|
|
72,301
|
|
69,306
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Financial
Information
|
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
Net cash provided
by operating activities
|
|
$
198,190
|
|
289,043
|
|
525,163
|
|
587,590
|
|
Depreciation and
amortization
|
|
$
86,329
|
|
63,878
|
|
308,871
|
|
280,293
|
|
Capital
expenditures
|
|
$
111,027
|
|
73,296
|
|
366,550
|
|
208,294
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Balance Sheet Data
|
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
$
54,066
|
|
477,672
|
|
Receivables, net
|
|
|
|
|
|
1,062,875
|
|
679,473
|
|
Inventories
|
|
|
|
|
|
1,572,325
|
|
1,133,736
|
|
Prepaid expenses and other current assets
|
|
|
|
|
|
248,918
|
|
147,580
|
|
Deferred income taxes
|
|
|
|
|
|
147,534
|
|
111,585
|
|
Total
current assets
|
|
|
|
|
|
3,085,718
|
|
2,550,046
|
|
Property, plant and
equipment, net
|
|
|
|
|
|
2,701,743
|
|
1,692,852
|
|
Goodwill
|
|
|
|
|
|
1,736,092
|
|
1,385,771
|
|
Intangible assets,
net
|
|
|
|
|
|
811,602
|
|
553,799
|
|
Deferred income taxes
and other non-current assets
|
|
|
|
|
|
159,022
|
|
121,216
|
|
Total assets
|
|
|
|
|
|
$
8,494,177
|
|
6,303,684
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
Current portion of
long-term debt
|
|
|
|
|
|
$
127,218
|
|
55,213
|
|
Accounts payable and
accrued expenses
|
|
|
|
|
|
1,193,593
|
|
773,436
|
|
Total
current liabilities
|
|
|
|
|
|
1,320,811
|
|
828,649
|
|
Long-term debt, less
current portion
|
|
|
|
|
|
2,132,790
|
|
1,327,729
|
|
Deferred income taxes
and other long-term liabilities
|
|
|
|
|
|
570,270
|
|
427,689
|
|
Total
liabilities
|
|
|
|
|
|
4,023,871
|
|
2,584,067
|
|
Total stockholders'
equity
|
|
|
|
|
|
4,470,306
|
|
3,719,617
|
|
Total liabilities and stockholders' equity
|
|
|
|
|
|
$
8,494,177
|
|
6,303,684
|
|
|
|
|
|
|
|
|
|
|
|
Segment
Information
|
|
Three Months
Ended
|
|
As of or for the
Twelve Months Ended
|
|
(Amounts in
thousands)
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
|
|
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
|
Carpet
|
|
$
747,143
|
|
725,895
|
|
2,986,096
|
|
2,912,055
|
|
Ceramic
|
|
738,004
|
|
401,637
|
|
2,677,058
|
|
1,616,383
|
|
Laminate and Wood
|
|
466,082
|
|
329,969
|
|
1,792,260
|
|
1,350,349
|
|
Intersegment sales
|
|
(27,125)
|
|
(21,842)
|
|
(106,660)
|
|
(90,807)
|
|
Consolidated net sales
|
|
$
1,924,104
|
|
1,435,659
|
|
7,348,754
|
|
5,787,980
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss):
|
|
|
|
|
|
|
|
|
|
Carpet
|
|
$
60,087
|
|
51,968
|
|
209,023
|
|
158,196
|
|
Ceramic
|
|
57,637
|
|
21,039
|
|
209,825
|
|
120,951
|
|
Laminate and Wood
|
|
40,290
|
|
29,796
|
|
159,365
|
|
126,409
|
|
Corporate and eliminations
|
|
(7,026)
|
|
(6,943)
|
|
(31,282)
|
|
(26,048)
|
|
Consolidated operating income
|
|
$
150,988
|
|
95,860
|
|
546,931
|
|
379,508
|
|
|
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
Carpet
|
|
|
|
|
|
$
1,786,085
|
|
1,721,214
|
|
Ceramic
|
|
|
|
|
|
3,787,785
|
|
1,731,258
|
|
Laminate and Wood
|
|
|
|
|
|
2,716,759
|
|
2,672,389
|
|
Corporate and eliminations
|
|
|
|
|
|
203,548
|
|
178,823
|
|
Consolidated assets
|
|
|
|
|
|
$
8,494,177
|
|
6,303,684
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Earnings Attributable to Mohawk Industries, Inc. to Adjusted
Net Earnings Attributable to Mohawk Industries, Inc. and Adjusted
Diluted Earnings Per Share Attributable to Mohawk Industries,
Inc.
|
(Amounts in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
Net earnings
attributable to Mohawk Industries, Inc.
|
|
|
|
$
94,651
|
|
66,389
|
|
348,786
|
|
250,258
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
|
37,812
|
|
6,109
|
|
113,420
|
|
18,564
|
Acquisitions purchase
accounting (inventory step-up)
|
|
|
|
-
|
|
-
|
|
31,041
|
|
-
|
Discontinued
operations
|
|
|
|
16,249
|
|
-
|
|
18,945
|
|
-
|
Deferred loan
costs
|
|
|
|
-
|
|
-
|
|
490
|
|
-
|
Interest on 3.85%
senior notes
|
|
|
|
-
|
|
-
|
|
3,559
|
|
-
|
Income
taxes
|
|
|
|
|
(17,621)
|
|
(2,111)
|
|
(42,841)
|
|
(7,003)
|
Adjusted net earnings
attributable to Mohawk Industries, Inc.
|
|
$
131,091
|
|
70,387
|
|
473,400
|
|
261,819
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted diluted
earnings per share attributable to Mohawk Industries,
Inc.
|
|
1.79
|
|
1.01
|
|
6.55
|
|
3.78
|
Weighted-average
common shares outstanding - diluted
|
|
|
73,214
|
|
69,536
|
|
72,301
|
|
69,306
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Cash Flow to Free Cash Flow
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$
198,190
|
|
|
|
|
|
|
|
|
Less: Capital
expenditures
|
|
111,027
|
|
|
|
|
|
|
|
|
Free cash
flow
|
|
|
$
87,163
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Total Debt to Net Debt
|
|
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
|
|
|
|
|
|
|
Current portion of
long-term debt
|
|
$
127,218
|
|
|
|
|
|
|
|
|
Long-term debt, less
current portion
|
|
2,132,790
|
|
|
|
|
|
|
|
|
Less: Cash and cash
equivalents
|
|
54,066
|
|
|
|
|
|
|
|
|
Net Debt
|
|
|
|
$
2,205,942
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Income to Proforma Adjusted EBITDA
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Trailing
Twelve
|
|
|
|
|
Three Months
Ended
|
|
Months
Ended
|
|
|
|
|
March 30,
2013
|
|
June 29,
2013
|
|
September 28,
2013
|
|
December 31,
2013
|
|
December 31,
2013
|
Operating
income
|
|
|
$
86,842
|
|
133,198
|
|
175,903
|
|
150,988
|
|
546,931
|
Other (expense)
income
|
|
(6,387)
|
|
1,097
|
|
(1,168)
|
|
(2,656)
|
|
(9,114)
|
Net (earnings) loss attributable to noncontrolling
interest
|
(72)
|
|
190
|
|
(491)
|
|
(132)
|
|
(505)
|
Depreciation and
amortization
|
|
60,349
|
|
80,643
|
|
81,550
|
|
86,329
|
|
308,871
|
EBITDA
|
|
|
140,732
|
|
215,128
|
|
255,794
|
|
234,529
|
|
846,183
|
Restructuring,
acquisition and integration-related costs
|
9,856
|
|
41,321
|
|
24,431
|
|
37,812
|
|
113,420
|
Acquisitions purchase
accounting (inventory step-up)
|
-
|
|
18,744
|
|
12,297
|
|
-
|
|
31,041
|
Acquisitions
EBITDA
|
|
|
|
43,072
|
|
-
|
|
-
|
|
-
|
|
43,072
|
Proforma
Adjusted EBITDA
|
|
$
193,660
|
|
275,193
|
|
292,522
|
|
272,341
|
|
1,033,716
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Debt to Proforma
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
2.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Sales to Net Sales on a Constant Exchange Rate
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
Net sales
|
|
|
|
$
1,924,104
|
|
1,435,659
|
|
7,348,754
|
|
5,787,980
|
|
|
Adjustment to net
sales on a constant exchange rate
|
|
|
|
(12,250)
|
|
-
|
|
(34,536)
|
|
-
|
|
|
Net sales on a
constant exchange rate
|
|
$
1,911,854
|
|
1,435,659
|
|
7,314,218
|
|
5,787,980
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Gross Profit to Adjusted Gross Profit
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
Gross
Profit
|
|
|
|
$
512,797
|
|
369,331
|
|
|
|
|
|
|
Adjustments to gross
profit:
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
integration-related costs
|
|
16,707
|
|
5,197
|
|
|
|
|
|
|
Adjusted gross
profit
|
|
|
$
529,504
|
|
374,528
|
|
|
|
|
|
|
Adjusted
gross profit as a percent of net sales
|
|
27.5%
|
|
26.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Selling, General and Administrative Expenses to Adjusted Selling,
General and Administrative Expenses
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
$
361,809
|
|
273,471
|
|
|
|
|
|
|
Adjustments to
selling, general and administrative expenses:
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
(19,644)
|
|
(912)
|
|
|
|
|
|
|
Adjusted
selling, general and administrative expenses
|
|
$
342,165
|
|
272,559
|
|
|
|
|
|
|
Adjusted selling,
general and administrative expenses as a percent of net
sales
|
17.8%
|
|
19.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Segment Selling, General and Administrative Expenses to Adjusted
Segment Selling, General and Administrative Expenses
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
Carpet
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
$
120,808
|
|
118,417
|
|
|
|
|
|
|
Adjustments to
selling, general and administrative expenses:
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
(3,487)
|
|
-
|
|
|
|
|
|
|
Adjusted
selling, general and administrative expenses
|
|
$
117,321
|
|
118,417
|
|
|
|
|
|
|
Adjusted selling,
general and administrative expenses as a percent of net
sales
|
15.7%
|
|
16.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Income to Adjusted Operating Income
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
Operating
income
|
|
|
$
150,988
|
|
95,860
|
|
546,931
|
|
379,508
|
|
|
Adjustment to
operating income:
|
|
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
36,351
|
|
6,109
|
|
111,939
|
|
18,564
|
|
|
Acquisitions purchase
accounting (inventory step-up)
|
|
-
|
|
-
|
|
31,041
|
|
-
|
|
|
Adjusted
operating income
|
|
$
187,339
|
|
101,969
|
|
689,911
|
|
398,072
|
|
|
Adjusted
operating margin as a percent of net sales
|
|
9.7%
|
|
7.1%
|
|
9.4%
|
|
6.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Segment Operating Income to Adjusted Segment Operating
Income
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
Carpet
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
Operating
income
|
|
|
$
60,087
|
|
51,968
|
|
209,023
|
|
158,196
|
|
|
Adjustment to segment
operating income:
|
|
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
6,005
|
|
-
|
|
13,603
|
|
10,504
|
|
|
Adjusted
segment operating income
|
|
$
66,092
|
|
51,968
|
|
222,626
|
|
168,700
|
|
|
Adjusted
operating margin as a percent of net sales
|
|
8.8%
|
|
7.2%
|
|
7.5%
|
|
5.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Segment Operating Income to Adjusted Segment Operating
Income
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
Ceramic
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
Operating
income
|
|
|
$
57,637
|
|
21,039
|
|
209,825
|
|
120,951
|
|
|
Adjustment to segment
operating income:
|
|
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
15,982
|
|
6,109
|
|
42,876
|
|
6,109
|
|
|
Acquisitions purchase
accounting (inventory step-up)
|
|
-
|
|
-
|
|
31,041
|
|
-
|
|
|
Adjusted
segment operating income
|
|
$
73,619
|
|
27,148
|
|
283,742
|
|
127,060
|
|
|
Adjusted
operating margin as a percent of net sales
|
|
10.0%
|
|
6.8%
|
|
10.6%
|
|
7.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Segment Operating Income to Adjusted Segment Operating
Income
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
Laminate and
Wood
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
Operating
income
|
|
|
$
40,290
|
|
29,796
|
|
159,365
|
|
126,409
|
|
|
Adjustment to segment
operating income:
|
|
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
13,852
|
|
-
|
|
54,235
|
|
1,951
|
|
|
Adjusted
segment operating income
|
|
$
54,142
|
|
29,796
|
|
213,600
|
|
128,360
|
|
|
Adjusted
operating margin as a percent of net sales
|
|
11.6%
|
|
9.0%
|
|
11.9%
|
|
9.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Earnings from Continuing Operations Before Income Taxes to Adjusted
Earnings from Continuing Operations Before Income
Taxes
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
Earnings from
continuing operations before income taxes
|
|
$
126,184
|
|
79,092
|
|
|
|
|
|
|
Adjustment to
earnings from continuing operations before income taxes:
|
|
|
|
|
|
|
|
|
Restructuring,
acquisition and integration-related costs
|
|
37,812
|
|
6,109
|
|
|
|
|
|
|
Adjusted
earnings before income taxes
|
|
$
163,996
|
|
85,201
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Income Tax Expense to Adjusted Income Tax
Expense
|
|
|
|
|
|
|
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
Income tax
expense
|
|
|
$
15,420
|
|
12,703
|
|
|
|
|
|
|
Income tax effect of
adjusting items
|
|
|
|
17,353
|
|
2,111
|
|
|
|
|
|
|
Adjusted
income tax expense
|
|
$
32,773
|
|
14,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income tax
rate
|
|
20%
|
|
17%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company believes
it is useful for itself and investors to review, as applicable,
both GAAP and the
|
|
|
|
|
|
|
above non-GAAP
measures in order to assess the performance of the Company's
business for
|
|
|
|
|
|
|
planning and
forecasting in subsequent periods.
|
|
|
|
|
|
|
|
|
|
|
In particular, the
Company believes excluding the impact of Restructuring, acquisition
and integration-related costs is useful because it allows investors
to evaluate our performance for different periods on a more
comparable basis.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Mohawk Industries, Inc.