<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Act of 1934
Date of Report (Date of earliest event reported): April 22, 1999
MOHAWK INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 01-19826 52-1604305
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
160 South Industrial Blvd., Calhoun, Georgia 30701
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(Address, including zip code, of principal executive offices)
(706) 629-7721
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(Registrant's telephone number, including area code)
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Item 5. Other Events
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On April 22, 1999, Mohawk Industries, Inc. ("Mohawk") issued a press
release containing certain earnings information with respect to the first
quarter ended April 3, 1999 earnings. A copy of such press release is
included as an exhibit to this report and incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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C. Exhibits
99.1 Press Release dated April 22, 1999
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Mohawk Industries, Inc.
Date: April 22, 1999 By: /s/ Frank H. Boykin
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Frank H. Boykin
Corporate Controller
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INDEX TO EXHIBITS
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Exhibit
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99.1 Press Release dated April 22, 1999
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EXHIBIT 99.1
Mohawk Industries, Inc.
Press Release
[LOGO OF MOHAWK INDUSTRIES, INC. APPEARS HERE]
For Release: Immediately
Contact: John D. Swift, Chief Financial Officer
MOHAWK INDUSTRIES, INC. ANNOUNCES
RECORD FIRST QUARTER 1999 RESULTS
Calhoun, Georgia, April 22, 1999 - Mohawk Industries, Inc. (NYSE: MHK) today
announced record results for the quarter ended April 3, 1999. Net earnings for
the quarter increased 63% to $27,892,000 or $0.46 diluted earnings per share,
compared to $17,135,000, or $0.28 diluted earnings per share, for the first
quarter of 1998. This improvement in net earnings was a result of both higher
sales and higher gross margins. Net sales for the quarter increased 20% to
$709,217,000 compared to $589,521,000 for the first quarter of 1998. This sales
increase was primarily attributable to internal growth, four additional business
days in the 1999 quarter and the impact of 1998 and 1999 acquisitions. Sales
(excluding acquisitions) increased 15% over the same period in 1998. Four extra
business days in the first quarter of 1999 versus the first quarter of 1998 were
somewhat offset by harsher winter conditions in the Midwest and Northeast during
1999. Excluding the extra days and acquisitions, sales increased approximately
8% during the first quarter of 1999 compared to the first quarter of 1998.
In commenting on the first quarter performance, David L. Kolb, Chairman and CEO,
stated, "We are very pleased with first quarter operations. Net sales growth
was achieved internally as well as through acquisitions. Our improvement in
gross margins and net earnings in the first quarter result primarily from
manufacturing efficiencies and favorable material costs. Selling, general and
administrative expenses have increased in 1999 primarily as a result of
increased sample costs related to new marketing initiatives under the
Floorscapes and Color Center programs. These programs are being favorably
received by our customers, and we are optimistic about the future results of
these programs.
I am proud to announce our company recently received recognition for several
different product awards and other accomplishments.
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1. We received the top award (Dealer's Choice Award), at Surfaces 1999, the
largest industry trade show, for the best carpet introduction for our
Heirloom Collection. Last year we took top honors for our Kid Proof
collection.
2. We received the Sears Roebuck 1999 Partner in Progress award which is
given to a select group of vendors for excellence in service, quality
and innovation.
3. Our company is now included in the Standard & Poors MidCap index after
being moved from the S&P SmallCap index.
We completed two acquisitions in the first quarter of 1999. Our purchase of
Image has made Mohawk one of the top manufacturers of polyester residential
carpet with state-of-the art recycling and production technology. Our
acquisition of Durkan Patterned Carpets is providing opportunities to further
strengthen our commercial product offerings, particularly, in the hospitality
market. These acquisitions are being integrated with our existing systems,
procedures and procurement practices and are expected to become accretive during
1999."
Certain of the statements in the immediately preceding paragraphs, particularly
anticipating future financial performance, business prospects, growth and
operating strategies, proposed acquisitions, new products and similar matters,
and those preceded by, followed by or that otherwise include the words
"believes," "expects," "anticipates," "intends," "estimates," or similar
expressions constitute "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended. For those statements,
Mohawk claims the protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995. Those
statements are based on assumptions regarding the Company's ability to
successfully integrate the Image and Durkan acquisitions and to successfully
complete the new marketing programs. These or other assumptions could prove
inaccurate and therefore, there can be no assurance that the "forward-looking
statements" will prove to be accurate. Forward-looking statements involve a
number of risks and uncertainties. The following important factors affect the
future results of Mohawk and could cause those results to differ materially from
those expressed in the forward-looking statements: materially adverse changes in
economic conditions generally in the carpet, rug and floorcovering markets
served by Mohawk; competition from other carpet, rug and floorcovering
manufacturers, raw material prices, timing and level of capital expenditures,
the successful integration of acquisitions including the challenges inherent in
diverting Mohawk's management attention and resources from other strategic
matters and from operational matters for an extended period of time, the
successful introduction of new products, the successful rationalization of
existing operations, and other risks identified from time to time in the
Company's SEC reports and public announcements.
Mohawk is a leading producer of woven and tufted broadloom carpet and rugs for
residential and commercial applications. The Company designs, manufactures and
markets carpet in a broad range of colors, textures and patterns and is widely
recognized through its premier brand names, some of which include "Mohawk,"
"Aladdin," "Alexander Smith," "Bigelow," "Durkan," "Galaxy," "Harbinger,"
"Helios," "Horizon," "Image," "Karastan," "Mohawk Commercial" and "World".
Mohawk offers a broad line of washable accent and bath rugs through Aladdin and
Newmark & James; area rugs through Karastan, American Rug Craftsmen and American
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Weavers; and decorative throws, placemats, table runners and kitchen chair pads
through American Weavers. Mohawk also offers a complete laminate product line
under the INSIGNIA brand name and distributes carpet padding and ceramic tile.
The Company markets its products primarily through retailers and commercial
dealers.
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MOHAWK INDUSTRIES, INC. AND SUBSIDIARIES
[CAPTION]
<TABLE>
Three Months Ended
Consolidated Statement of Earnings Data ---------------------------------
(Amounts in thousands, except per share data) Apr 3, 1999 Mar 28, 1998 (1)
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<S> <C> <C>
Net sales $ 709,217 589,521
Cost of sales 529,518 452,778
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Gross profit 179,699 136,743
Selling, general and administrative expenses 124,090 98,464
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Operating income 55,609 38,279
Interest expense 7,854 7,990
Other expense (income), net 1,469 (56)
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Earnings before income taxes 46,286 30,345
Income taxes 18,394 13,210
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Net earnings $ 27,892 17,135
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Basic earnings per share $ 0.46 0.28
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Weighted-average common shares outstanding 60,565 60,266
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Diluted earnings per share $ 0.46 0.28
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Weighted-average common and dilutive potential common
shares outstanding 61,285 60,977
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</TABLE>
Consolidated Balance Sheet Data
(Amounts in thousands)
<TABLE>
<CAPTION>
ASSETS Apr 3, 1999 Mar 28, 1998 (1)
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<S> <C> <C>
Current assets:
Cash $ -- 80
Receivables 360,676 328,627
Inventories 499,003 407,689
Prepaid expenses 8,649 12,623
Deferred income taxes 52,304 38,291
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Total current assets 920,632 787,310
Property, plant and equipment, net 591,626 415,388
Other assets 111,411 77,021
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$1,623,669 1,279,719
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 197,087 43,157
Accounts payable and accrued expenses 381,556 344,324
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Total current liabilities 578,643 387,481
Long-term debt, less current portion 363,369 346,979
Deferred income taxes and other long-term liabilities 35,950 35,131
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Total liabilities 977,962 769,591
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Total stockholders' equity 645,707 510,128
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$1,623,669 1,279,719
========== =========
</TABLE>
(1) Restated to give retroactive effect to the merger of Mohawk and Durkan,
which was accounted for under the pooling-of-interests basis of accounting.
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Dates for Future Press Releases and Conference Calls:
Press Release Conference Call
1st Qtr. 1999 April 22 April 23 11:00 a.m. (800-603-9255)
2nd Qtr. 1999 July 22 July 23 11:00 a.m. "
3rd Qtr. 1999 October 21 October 22 11:00 a.m. "
4th Qtr. 1999 February 10 February 11 11:00 a.m. "
