Armstrong World Industries 3Q results mixed
NEWS: Floor and ceiling manufacturer Armstrong World Industries Inc. said Monday that its third-quarter net income fell 20 percent as expenses climbed and it dealt with higher lumber and labor costs.
Profit topped analysts' estimates, but revenue missed Wall Street's view.
The company lowered the high end of its full-year adjusted profit and revenue forecasts as commercial construction activity flattened in the U.S. and Europe.
DETAILS: Selling, general and administrative expenses increased to $103 million from $94 million, while income tax expense rose to $26.1 million from $20.9 million.
In the building products unit, sales climbed on higher prices, a better product mix and increased volumes in the Pacific Rim. The resilient flooring segment had flat sales as favorable foreign exchange, higher volumes and a better mix were offset by lower prices. Sales rose for the wood flooring division thanks to increased volumes.
NUMBERS: For the three months ended Sept. 30, Armstrong earned $50.4 million, or 85 cents per share. A year earlier the company earned $62.9 million, or $1.05 per share. Excluding certain items, earnings were 87 cents per share.
Earnings from continuing operations were 94 cents per share.
Revenue increased 5 percent to $729.7 million from $694.7 million on higher volumes in residential businesses, mostly wood flooring.
Analysts surveyed by FactSet expected earnings of 86 cents per share on revenue of $743.5 million.
OUTLOOK: Armstrong expects full-year adjusted earnings of $2 to $2.20 per share on revenue of $2.7 billion to $2.74 billion. Its prior guidance was for adjusted earnings of $2 to $2.30 per share on revenue of $2.7 billion to $2.8 billion.
Analysts predict full-year earnings of $2.18 per share on revenue of $2.73 billion.
For the fourth quarter, the company anticipates revenue between $645 million and $685 million. Wall Street is looking for $657.2 million in revenue.
STOCK: The shares rose 85 cents, or 1.5 percent, to $56.07 in morning trading. Year to date, the stock is up 9 percent.