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Mar 28, 2020
Mohawk Q1 2020 Earnings Report
Mohawk Industries reported a decrease in net sales and earnings per share for Q1 2020, impacted by the COVID-19 pandemic.
Key Takeaways
Mohawk Industries reported Q1 2020 net sales of $2.3 billion, a 6.4% decrease compared to Q1 2019. Net earnings were $111 million, with a diluted EPS of $1.54. The company's performance was impacted by the COVID-19 outbreak, which led to reduced demand and production adjustments across all markets.
Net sales decreased by 6.4% to $2.3 billion due to the impact of COVID-19.
Net earnings were $111 million, and diluted EPS was $1.54.
The company has $1.3 billion in liquidity to manage through the crisis.
Mohawk is reducing capital expenditures and non-essential expenses to conserve cash.
Mohawk
Mohawk
Mohawk Revenue by Segment
Revenue by Segment
Global Ceramic Revenue
CapyFin.comFlooring North America Revenue
CapyFin.comFlooring Rest of World Revenue
CapyFin.com Forward Guidance
Due to the uncertainty surrounding the COVID-19 pandemic, Mohawk Industries is unable to provide EPS guidance for the second quarter and anticipates an operating loss.
Positive Outlook
- Strong balance sheet with substantial liquidity of $1.3 billion.
- Solid business model with strong local teams in each market.
- Focus on conserving cash, adjusting production, and reducing inventory.
- Reducing expenses and investments and aligning with government requirements and support.
- Optimistic about the long-term future of the business.
Challenges Ahead
- The rate at which governments will open commerce and the subsequent consumer response cannot be determined.
- Some businesses have postponed investments in both remodeling and new construction.
- Sales rate is about 35% below the prior year at the end of April.
- Anticipate an operating loss in the second quarter due to the impact of COVID-19.
- Unable to provide EPS guidance for the second quarter.
Revenue & Expenses
Visualization of income flow from segment revenue to net income