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Armstrong World Industries Inc. Reports Operating Results (10-Q)

July 30, 2009 | About:
10qk

Armstrong World Industries Inc. (AWI) filed Quarterly Report for the period ended 2009-06-30.

ARMSTRONG WORLD INDUSTRIES INC is a global leader in the design and manufacture of floors ceilings and cabinets. Armstrongs consolidated net sales totaled approximately $3.5 billion. Based in LancasterArmstrong operates Forty plants in ten countries. Armstrong World Industries Inc. has a market cap of $1.2 billion; its shares were traded at around $20.99 with a P/E ratio of 11.7 and P/S ratio of 0.4.

Highlight of Business Operations:

SG&A expenses in the second quarter of 2009 were $127.3 million, or 18.0% of net sales, and in the first six months of 2009 were $264.5 million, or 19.3% of net sales, compared to $147.0 million, or 15.9% of net sales and $306.8 million, or 17.5% of net sales for the corresponding periods in 2008. The decrease in expense was primarily due to reduced spending in all segments. The increase in SG&A expenses as a percent of net sales is due to the decrease in net sales.

Equity earnings from our WAVE joint venture were $10.4 million in the second quarter of 2009, compared to $18.5 million in the second quarter of 2008, and $17.3 million in the first six month of 2009, compared to $31.7 million in the first six months of 2008. See Note 7 for further information.

We recorded operating income of $47.1 million in the second quarter of 2009 compared to operating income of $96.7 million in the second quarter of 2008. We recorded operating income of $48.2 million in the first six months of 2009 compared to operating income of $135.2 million in the first six months of 2008.

Interest expense was $4.5 million in the second quarter of 2009 compared to $7.8 million in the second quarter of 2008. Interest expense was $9.0 million in the first six months of 2009 compared to $16.2 million in the first six months of 2008. The decrease in 2009 is primarily due to lower interest rates.

Income tax expense was $14.7 million and $38.5 million for the second quarter of 2009 and 2008, respectively. The effective tax rate for the second quarter of 2009 was 34.2% as compared to a rate of 42.4% for 2008. The effective tax rate for 2009 was lower than 2008 due to the recognition of a previously unrecognized tax benefit that was partially offset by higher unbenefited foreign losses. Income tax expense was $23.5 million and $57.5 million for the first six months of 2009 and 2008, respectively. The effective tax rate for the first six months of 2009 was 57.9% versus 46.0% for 2008. The effective tax

Net earnings of $28.3 million for the second quarter of 2009 compared to net earnings of $52.4 million for the second quarter of 2008. Net earnings of $17.1 million for the first six months of 2009 compared to net earnings of $67.6 million for the first six months of 2008.

Read the The complete ReportAWI is in the portfolios of Michael Price of MFP Investors LLC, Richard Pzena of Pzena Investment Management LLC.

Rating: 3.8/5 (6 votes)

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