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In keeping with SEC requirements, I advise that during this call, we will be making forward-looking statements that involve risks and uncertainties. Actual outcomes may differ materially from those expected or implied. For a more detailed discussion of the risks and uncertainties that may affect Armstrong, please review our SEC filings, including the 10-K filed this morning.Forward-looking statements speak only as of the date they are made. We undertake no obligation to update any forward-looking statement beyond what is required by applicable securities laws. In addition, our discussion of operating performance will include non-GAAP financial measures within the meaning of SEC Regulation G. A reconciliation of these measures with the most directly comparable GAAP measures is included in the press release and in the appendix of the presentation. Both are available on our website. With that, I will turn the call over to Matt. Matt Espe Thanks, Tom. Good afternoon, everyone, and thanks for participating in our call today. In the fourth quarter of 2011, we saw stability in North America, but the turmoil surrounding Greece and Eurozone precipitated a sharp drop in demand in Western Europe late in the quarter. Against the backdrop of global uncertainty and macroeconomic volatility, our sales for the quarter were $652 million within our guidance range albeit near the low end, primarily reflecting the weakness that we saw in Europe. Year-on-year sales were up $9 million or $6 million on a comparable foreign exchange basis, both about a 1% increase. Europe was the only geography with lower sales. Adjusted EBIDTA for the fourth quarter of 2011 was $51 million, up $4 million or 9% from 2010, but below our guidance range of $55 million to $75 million driven by weaker than anticipated sales in western Europe in both our business, flat volumes in North American ceilings versus our expectation of a small uptick and weakness in our Cabinets division.
For the year, net sales of $2.86 billion were up $90 million or 3% from 2010. Excluding the impact of foreign exchange and product category exits in our European Flooring segment, sales were also up 3%. The sales increase came in the form of price and mix as global volumes were roughly flat. Now, when excluding exited businesses, 2011 marks the first time in the last three years that volumes have not declined year-over-year.Despite no meaningful help from markets, full year adjusted EBITDA was $377 million, up $74 million or 24% from 2010. Our business units contributed to this result with significant contributions from the following operations. Wood Flooring grew adjusted EBITDA from $5 million in 2010 to $53 million in 2011 despite flat sales. This result is our best example of cost reduction and lean improvements. Our Cabinets divisions swung from an EBITDA loss of over $4 million in 2010 to a profit of $2 million in 2011 on lower sales. And finally our European Flooring operation reduced their EBITDA loss from $10 million in 2010 to $3 million in 2011. When we last spoke in October we discussed the turnaround we are executing in this business and our expectation that we could realize an EBITDA profit in European Flooring in 2011. Unfortunately this significant macroeconomic events in Europe late in the quarter transpired to leave a shot at the target. While I'm disappointed on our fourth quarter results from this business I am extremely proud of the significant restricting efforts which barring unforeseen further deterioration in European economy will lead to a profitable business in 2012. Our cost out initiatives continued to help drive bottom line performance as we realized $115 million in savings in manufacturing and G&A overhead costs in 2011. Combined with the $35 million saved in 2010 and an additional $35 million expected in 2012 our total cost out effort is not approaching $185 million. Read the rest of this transcript for free on seekingalpha.com