Interface, Inc, a worldwide carpet tile company and global leader in sustainability, announced results for the second quarter ended June 29, 2014.
Second Quarter 2014 Financial Summary & Highlights:
Sales: Sales for the second quarter of 2014 were up 7.0% to $260.6 million, compared with $243.5 million in the second quarter of 2013. Sales in our Americas business increased 4% year-over-year, with most of the growth coming in non-office segments.
The hospitality (up 30%), retail (up 21%) and education (up 7%) segments had the largest percentage gains, with government (down 4%) and healthcare (down 2%) being the only declining segments. The corporate office segment grew less than 1% compared with the second quarter last year. FLOR sales were disappointing, down 9% year-over-year.
Europe business showed the most momentum, with sales up 15% (or 9% in local currency), mainly due to strength in the U.K., Ireland and Germany. The corporate office segment (up 18%) led the gains. Sales were up 5% in the Asia-Pacific region, with Australia bouncing back and approaching revenue levels that existed prior to the 2012 plant fire. China also contributed to the growth, with Southeast Asia remaining flat.
Operating Income: Second quarter 2014 operating income increased to $24.3 million, or 9.3% of sales, compared with $21.8 million, or 9.0% of sales, in the second quarter last year. Gross profit margin was 34.7% in the second quarter of 2014, compared with 35.4% in the prior year period, but represented an improvement of 60 basis points sequentially compared with the first quarter this year.
SG&A expenses were $66.0 million, or 25.3% of sales, in the second quarter of 2014, versus $64.4 million, or 26.5% of sales, in the second quarter of 2013. The year-over-year SG&A percentage improvement was mostly due to improved sales volume, reduced equity compensation, and reduced marketing activity in Europe.
Net Income: Net income during the second quarter of 2014 increased to $13.1 million, or $0.20 per share, compared with net income of $11.0 million, or $0.17 per share, in the second quarter last year.
Year to Date 2014 Financial Results:
Sales: For the first six months of 2014, sales increased 5.7% to $479.6 million, compared with $453.9 million in the first six months last year.
Operating Income: Operating income for the 2014 six-month period was $36.4 million, or 7.6% of sales. Operating income in the first six months of 2013 was $35.8 million, or 7.9% of sales.
Net Income: The Company reported net income of $17.1 million, or $0.26 per share, for the first six months of 2014. This compares with net income of $16.1 million, or $0.24 per share, in the first six months of 2013, excluding a previously-reported tax dispute resolution benefit of $1.9 million, or $0.03 per share. With the tax resolution benefit included, net income in the first six months of 2013 was $18.0 million, or $0.27 per share