Mohawk Industries Inc. (Calhoun, Ga.) had a 24.6 percent drop in profits during the second quarter of 2018 due to what its CEO said were higher transportation costs and a “tight labor market.”
The company reported net earnings of $196.5 million during the quarter, a fall from Q2 2017’s net earnings of $260.6 million. Net sales were up 5 percent compared with 2017, totaling $2.6 billion. Earnings per share dropped 6 percent, falling from $3.72 to $3.51. Shares plunged 14 percent to $189 after the company released its Q2 earnings report July 25.
“Our results fell short of our expectations, and we are taking actions to improve the performance of our U.S. businesses,” Mohawk Chairman and CEO Jeffrey S. Lorberbaum stated.
Along with transportation and labor problems, Lorberbaum cited input inflation, a stronger dollar, lower production units and start-up of new projects as reasons for the earnings decline during the quarter.
“To address these, we are raising prices, expanding in growing channels and participating in new products and geographies,” Lorberbaum stated.
