Unilin acquisition fuels Mohawk performance
Staff Staff -- Furniture Today, July 28, 2006
Calhoun, Ga. -- Buoyed by a recent acquisition, deep cuts in capital spending and a $6.3 U.S. customs refund, second-quarter profits at Mohawk Industries Inc. jumped up by 21.9%, to $119.5 million from $98.1 million last year.
Getting a big lift from last year's buyout of Belgian flooring company Unilin, sales raced ahead by 26.7%, to $2.1 billion from $1.6 billion the year before. Unilin added $313.8 million to the top line, and without that contribution, sales would have increased a more modest 7.4%. Sales in the core Mohawk business grew by 4.8%, held somewhat in check by slowing demand in the replacement market for residential carpets as higher gas prices put a dent in consumer spending.
Unilin made a solid contribution to the bottom line as well, generating an operating profit of $59.7 million. That helped offset weakness in the core Mohawk business, where operating profits fell by 3.3%, to $99.0 million from $102.4 million.
In another big lift to the bottom line, Mohawk slashed its capital spending during the period by 42.9%, to $37.0 million from $64.8 million last year, generating a cash savings of $27.8 million.
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