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Mohawk Industries Profit Slips

Energy prices hit the flooring company.

Mohawk Industries

(MHK) - Get Mohawk Industries, Inc. Report

, a supplier of flooring for both residential and commercial applications, said fourth-quarter profits fell 16.4% due to a one-time non-cash charge.

The company earned $85.7 million, or $1.26 a share, in the quarter, compared with $102.5 million, or $1.52 a share, a year ago. Adjusted for a charge of $22.3 million related to purchase accounting of inventory of Unilin, earnings were $1.59 a share. Analysts polled by Thomson First Call were expecting earnings of $1.50 a share.

Fourth-quarter revenue rose 22% to $1.8 billion thanks to unit growth, price increases and the acquisition of laminate manufacturer Unilin. Analysts were also expecting revenue of $1.8 billion in the most recent quarter.

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The company expects to earn $1.17 a share to $1.26 a share in the first quarter of 2006, including stock options expense of 4 cents a share. Analysts are expecting earnings of $1.28 a share.

Revenue for the Mohawk segment rose 8% to $1.2 billion due to price increases. The Dal-Tile segment revenue rose 19% to $443.7 million due to volume growth, price increases and a small stone products acquisition, the company said. The Unilin segment, acquired on Oct. 31, 2005, posted revenue of $168.8 million.

Operating profit decreased 4.3% to $165.3 million whereas operating profit margin declined by 250 basis points to 9.2%.

"Raw material and energy costs increased substantially and necessitated increasing selling prices twice during the fourth quarter. As in the past, our margins were impacted by the difference in timing between cost increases and implementation of price changes. We expect to pass these increases through to the customer," the company said.

This story was created through a joint venture between TheStreet.com and IRIS.