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ARMSTRONG WORLD INDUSTRIES REPORTS RESULTS

 ARMSTRONG WORLD INDUSTRIES REPORTS RESULTS
 LANCASTER, Pa., July 28 /PRNewswire/ -- Despite second-quarter sales


that reached the highest levels of any quarter in the company's history, Armstrong World Industries, Inc. (NYSE: ACK) reported that net earnings were slightly lower than 1991 results.
 Armstrong's announcement also showed record sales for the first half, with earnings from continuing businesses and net earnings higher than those of the first half of 1991.
 Sales in the second quarter of this year were a record $651.7 million, an increase of 4 percent over the $627.8 million reported for the second quarter of 1991. The U.S. resilient flooring business led the company in sales increases, with gains recorded in residential sheet flooring, commercial and residential tile and floors for manufactured homes.
 Earnings from continuing businesses amounted to $23.3 million in the second quarter of 1992 -- 5 percent below the $24.4 million reported for the second quarter of last year.
 Net earnings for the quarter were also at $23.3 million -- less than 1 percent below the $23.4 million of 1991's second quarter, which included losses from discontinued businesses.
 Earnings per common share from continuing businesses and net earnings in the second quarter of 1992 amounted to 50 cents on a primary basis and 47 cents on a fully diluted basis. In the second quarter of last year, earnings per common share from continuing businesses were 53 cents on a primary basis and 50 cents on a fully diluted basis, while net earnings per common share were the same as this year's figures of 50 cents primary and 47 cents fully diluted.
 The 1992 second-quarter results included before-tax losses of $1.6 million from hedging foreign currency transactions, compared with a gain of $1.1 million in 1991's second quarter. Both years' results reflected restructuring charges, including severance pay, special retirement incentives, obsolescence and similar items -- $3.4 million in 1992, compared with $2.8 million in 1991. Second-quarter 1991 results also included an expense of $2.3 million for adjustments to workers' compensation insurance.
 The return on average common shareholders' equity was 8.4 percent in this year's second quarter. It was 8.5 percent in the comparable period last year.
 Armstrong reports sales and operating profit for each of the four worldwide industry segments that constitute the company's business -- floor coverings (which includes resilient flooring and ceramic tile), building products, furniture and industry products. When 1992 results are compared with those of 1991's second quarter, sales and operating profit increased in the floor coverings, furniture and industry products segments but decreased in building products.
 For the first half of this year, the company announced these results:
 -- In 1992, net sales were a record $1.29 billion, an increase of 5 percent over 1991's $1.22 billion.
 -- Earnings from continuing businesses were $41.5 million, compared with $40.2 million last year -- an increase of 3 percent. On a per- share basis, earnings from continuing businesses were 86 cents primary and 81 cents fully diluted, compared with 1991's 82 cents primary and 79 cents fully diluted.
 -- Net earnings were $41.5 million, up 9 percent from 1991's $38.2 million. On a per-share basis, net earnings were 86 cents primary and 81 cents fully diluted. In 1991's first half, net earnings per share amounted to 77 cents primary and 74 cents fully diluted.
 -- Return on common shareholders' equity was 7.2 percent, compared with 6.5 percent in the first half of 1991.
 The six-month results included before-tax losses of $1.1 million from hedging foreign currency transactions, compared with a gain of $5.8 million last year. Restructuring charges were $6.4 million in this year's first half, compared with $3.0 million in 1991. First-half 1991 results also included expenses for the workers' compensation adjustment of $2.3 million and $2.4 million for interest expense related to settlement of prior year tax issues.
 The effective second-quarter tax rate of 29.9 percent was well below the 35.6 percent reported in the second quarter of 1991. For the first half, the company's effective tax rate was 33.2 percent compared with 35.2 percent last year. The principal reason for the reductions was the use in 1992 of excess foreign tax credits compared with the 1991 period, when withholding taxes on unusually large dividends from foreign affiliates increased the tax rate.
 Commenting on Armstrong's second-quarter results, William W. Adams, chairman and president, said, "In the midst of U.S. and Canadian economies that are still struggling and the sluggish pace of new building construction in Europe, we continue to place all our emphasis on striking the proper balance with our sales, expenses and manufacturing costs. Sales increases over the second quarter of 1991 were modest for the company as a whole, but quite satisfactory in furniture and in our worldwide resilient flooring, insulation and gasket businesses. Costs and expenses are in balance in most businesses, even with heavier-than-usual investments in new product support during the second quarter.
 "The outlook for the rest of the year is unchanged: weak demand in commercial construction, stable but unspectacular growth in other market segments, with opportunities for gradual improvement in earnings through our own business effectiveness."
 ARMSTRONG WORLD INDUSTRIES, INC., AND SUBSIDIARIES
 Financial Highlights
 (estimated and unaudited)
 (millions except for per-share data and percentages)
 Three months Six months
 ended June 30 ended June 30
 1992 1991(A) 1992 1991(A)
 NET SALES $ 651.7 $ 627.8 $1,290.1 $1,223.9
 Cost of goods sold 473.6 454.5 940.8 899.5
 Selling and
 administrative expense 128.9 116.7 256.8 234.4
 Interest expense 10.1 11.8 20.2 24.2
 Other (income) expense 6.0 7.0 10.2 3.8
 Earnings from continuing
 businesses before
 income taxes 33.1 37.8 62.1 62.0
 Income taxes 9.8 13.4 20.6 21.8
 EARNINGS FROM
 CONTINUING BUSINESSES $ 23.3 $ 24.4 $ 41.5 $ 40.2
 Losses from discontinued
 businesses,
 net of income taxes -- (1.0) -- (2.0)
 NET EARNINGS $ 23.3 $ 23.4 $ 41.5 $ 38.2
 Per share of common stock:
 Primary:
 Earnings from continuing
 businesses $ .50 $ .53 $ .86 $ .82
 Losses from discontinued
 businesses -- (.03) -- (.05)
 Net earnings $ .50 $ .50 $ .86 $ .77
 Fully diluted:
 Earnings from continuing
 businesses $ .47 $ .50 $ .81 $ .79
 Losses from discontinued
 businesses -- (.03) -- (.05)
 Net earnings $ .47 $ .47 $ .81 $ .74
 Average number of common shares
 outstanding:
 Primary 37.2 37.2 37.2 37.2
 Fully diluted 43.1 43.0 43.2 43.0
 Return on average
 common shareholders'
 equity (pct.) 8.4 8.5 7.2 6.5
 (A) Operating statement categories have been restated to exclude the effects of discontinued businesses and to conform to current expense classifications.
 INDUSTRY SEGMENTS
 (estimated and unaudited)
 (millions)
 Three months Six months
 ended June 30 ended June 30
 1992 1991(A) 1992 1991(A)
 Net trade sales:
 Floor coverings $ 299.8 $ 287.4 $ 564.4 $ 525.2
 Building products 166.3 172.0 345.0 345.4
 Furniture 110.4 101.7 219.9 207.2
 Industry products 75.2 66.7 160.8 146.1
 Total net sales $ 651.7 $ 627.8 $1,290.1 $1,223.9
 Operating profit:
 Floor coverings $ 34.8 $ 34.1 $ 56.8 $ 44.8
 Building products 9.2 14.5 20.1 28.1
 Furniture 5.4 4.5 10.6 8.1
 Industry products 10.6 9.1 24.9 23.4
 Total operating profit $ 60.0 $ 62.2 $ 112.4 $ 104.4
 (A) 1991 industry segment net trade sales and operating profit are restated to exclude the effects of discontinued businesses.
 -0- 7/28/92
 /CONTACT: Armstrong Public Relations, 717-396-3313/
 (ACK) CO: Armstrong World Industries, Inc. ST: Pennsylvania IN: SU: ERN


LJ -- PH008 -- 3958 07/28/92 10:12 EDT
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