Mohawk Net Climbs 72 Percent in First Quarter
CALHOUN, Ga.-Increased sales and strong expense controls brought a healthy beginning to the fiscal year for Mohawk Industries.
For its fiscal first quarter ending on March 31, the company posted a 72 percent jump in net income to $40.4 million. Net sales increased 4.9 percent to $1.4 billion, driven by gains in volume and by price increases.
The Dal-Tile segment enjoyed a particularly strong quarter, growing sales by 14 percent due to increased residential remodeling and commercial renovations. The Mohawk segment's sales grew 1 percent, with increased carpet sales offset by declines in rug sales.
Selling, general and administrative expenses edged up 0.7 percent in dollars and shed 85 basis points as a percentage of sales, to 20.4 percent. Interest expense fell 15.4 percent. Gross margin rose nine basis points to 25.5 percent.
Looking ahead, Mohawk said industry growth should be aided by lower mortgage rates, increased home sales and higher employment. "In the second quarter, we anticipate continued sales growth and improving margins as selling prices align with material inflation," the company said.