Interface sales marginally down in FY 2012

Sales: Sales for the fourth quarter of 2012 were $249.6 million, up slightly compared with sales of $244.5 million in the fourth quarter of 2011.

- The Americas division, up 8.2% year-over-year, led the increase, with segment growth in corporate office (up 16%), education (up 14%), government (up 22%) and hospitality (up 63%) offsetting decreases in the retail (down 31%) and healthcare (down 16%) segments.

- The Asia-Pacific region was essentially even year-over-year, with sales growth in China and Southeast Asia offsetting declines in Japan and Australia.  Australia's sales continue to be impacted by the plant fire and the transition to a temporary import model, with product for Australia currently being manufactured at the Company's other plants worldwide.  Corporate office sector sales in the Asia-Pacific region were up 14% year-over-year, with other segments steady or slightly down.

- The European region was down 3% in local currency, or 7% as reported in U.S. dollars.  Sales in local currency increased in the government (up 11%), retail (up 27%) and hospitality (up 12%) segments.

- As previously announced, the Company completed the sale of its Bentley Prince Street business segment in August of 2012.  Results for Bentley Prince Street for the 2012 fourth quarter and full year, and for all prior periods, have been classified as discontinued operations.

Operating income:  Excluding a $2.3 million restructuring charge and $0.8 million of Australia fire expenses, operating income in the 2012 fourth quarter was $21.9 million, or 8.8% of sales.  (Including those charges and expenses, operating income was $18.8 million, or 7.5% of sales.) 

This compares with operating income in the 2011 fourth quarter of $20.7 million, or 8.5% of sales, excluding a restructuring charge of $5.8 million in that period.  (Including the prior year period restructuring charge, operating income in the 2011 fourth quarter was $14.9 million, or 6.1% of sales). 

SG&A expenses in the quarter were $63.2 million, or 25.3% of sales, versus 24.2% in the fourth quarter of 2011 and up sequentially from 23.9% in the third quarter of 2012.  The increase was largely attributable to additional sales and marketing expenditures, primarily from the opening of five new FLOR stores, as well as higher incentive compensation.

Income from continuing operations: Excluding the above-mentioned restructuring charge and Australia fire expenses, the Company reported income from continuing operations of $10.4 million, or $0.16 per diluted share, in the fourth quarter of 2012.  With these items, income from continuing operations was $7.4 million, or $0.11 per diluted share.  Excluding the $5.8 million restructuring charge in the prior year period, income from continuing operations was $9.0 million, or $0.14 per diluted share (including the charge, $5.0 million, or $0.08 per diluted share) in the fourth quarter of 2011.