- Net sales up 34% over PY
- Adjusted EPS increased 77%
CALHOUN,
Ga., Feb. 20, 2014
/CNW/ - 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.