Atlanta-based modular carpet company Interface, Inc. (Nasdaq: IFSIA) reported a huge year-over-year profit increase for 2Q08, ending June 29, 2008.
Net income for 2Q08 was $15.9 million, or $0.26 per
diluted share. Last year, second quarter results included a loss from
discontinued operations of $12.3 million, or $0.20 per diluted share,
which led to net income of $1.0 million, or $0.02 per diluted share.
"Our 2008 second quarter represented Interface’s best second quarter
ever in terms of operating income and earnings per share, despite the
challenging market and economic environment," said Daniel T. Hendrix,
President and CEO. "We continued to grow our business and gain market
share, as overall sales increased more than 11%, driven by our market
segmentation strategy, the ongoing secular shift toward carpet tile,
our presence in emerging geographic markets, and a positive currency
impact. These factors more than offset softer sales volumes in the
Western Europe and U.S. corporate office markets."
Operating income for the second quarter of 2008 increased 8.2% to $33.4
million, or 11.3% of sales, compared with operating income of $30.9
million, or 11.7% of sales, in the second quarter of 2007. Income from
continuing operations for the 2008 second quarter was $15.9 million, an
increase of 19.2% compared with income from continuing operations of
$13.3 million in the second quarter of 2007.
Sales for the second quarter of 2008 increased 11.3% to $295.0 million from sales of $265.0 million in the year ago period. Gross profit margin for 2Q08 grew 90 basis points to 35.7%, versus 34.8% in the second quarter of the previous year.
For the first six months of 2008, sales were $556.7 million, compared with $508.5 million for the same period a year ago, an increase of 9.5%. Operating income for the 2008 six-month period was $64.4 million, versus operating income of $55.2 million for the comparable 2007 six-month period (which included a loss of $1.9 million, or $0.03 per diluted share, on the disposal of its specialty products business).
Income from continuing operations was $30.0 million, or $0.48 per diluted share, in the 2008 six-month period, compared with income from continuing operations of $22.4 million, or $0.36 per diluted share, in the same period a year ago. Net income also was $30.0 million, or $0.48 per diluted share, in the first six months of 2008. Including results of discontinued operations, net loss for the first six months of 2007 was $39.6 million, or $0.64 per diluted share.
Mr. Hendrix concluded, "Our ongoing investments to advance our segmentation strategy in Europe are expected to further reduce our exposure to the corporate office market and open additional growth opportunities in that region. And, we’re moving forward with plans to expand our global presence by building a carpet tile plant in China. We believe we have the right strategy in place, and are confident in our business as we enter the second half of 2008."
About Interface
Interface, Inc. is the world’s largest manufacturer of modular carpet, which it markets under the InterfaceFLOR, FLOR, Heuga and Bentley Prince Street brands, and, through its Bentley Prince Street brand, enjoys a leading position in the designer quality segment of the broadloom carpet market. The Company is committed to the goal of sustainability and doing business in ways that minimize the impact on the environment while enhancing shareholder value.
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