Interface, Inc. (IFSIA), a floorcoverings and fabrics company, announced its results for the fourth quarter and full year ended January 1, 2006. Sales in the 2005 fourth quarter rose 12.0% to $260.6 million from $232.6 million in the year ago period. Operating income in the 2005 fourth quarter was $23.1 million, compared with operating income of $15.3 million in the fourth quarter 2004, an increase of 51.0%. As a percentage of sales, operating income improved to 8.9% in the fourth quarter of 2005 versus 6.6% in the fourth quarter of last year.
Pursuant to the provisions of the American Jobs Creation Act of 2004, the Company repatriated $25.4 million of earnings from foreign subsidiaries during the fourth quarter of 2005. This action took advantage of an opportunity to repatriate the funds at a substantially reduced tax rate, provided the transaction occurred before the end of 2005. Consequently, the Company recorded a tax charge of approximately $1.8 million, or $0.03 per share, in the fourth quarter related to the repatriation. After this charge, net income for the fourth quarter 2005 was $5.7 million, or $0.11 per diluted share, compared with a net loss in the fourth quarter of 2004 of $4.4 million, or $0.08 per diluted share.
For the full year 2005, sales increased 11.8% to $985.8 million, compared with $881.7 million in 2004. Operating income rose 35.0% to $82.0 million, or 8.3% of sales, from $60.7 million, or 6.9% of sales, last year. Income from continuing operations was $18.0 million, or $0.34 per diluted share, for 2005, versus income from continuing operations of $6.4 million, or $0.12 per diluted share, a year ago.
In connection with the Company’s repatriation in 2005 of an aggregate of $35.9 million of earnings of foreign subsidiaries, it recorded aggregate tax charges of $3.4 million, or $0.06 per diluted share. After these charges, together with losses from discontinued operations of $14.8 million and a loss on disposal of $1.9 million, net income for 2005 was $1.2 million, or $0.02 per diluted share. This compares with a net loss in 2004 of $55.4 million, or $1.06 per diluted share (which included a loss from discontinued operations of $58.8 million and a loss on disposal of $3.0 million).
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