"While full year results were flat with the previous year, the company showed significant year-over-year second half improvement in net earnings, despite the weak economy and the events of September 11," said Domco Tarkett President Ulf Mattsson.
84.7% of the $649.6 million in total sales were generated in the U.S., compared to 84.8% during the same period in 2000.
In the resilient flooring segment sales of $387.6 million were generated compared to $420.7 million the previous year, a decrease of 8%. Sales in the hardwood-flooring segment increased by 15% to $183.6 million from $159.1 million a year ago. The hardwood segment accounted for 28.3% of the corporation's consolidated net sales, compared to 24.2% a year ago.
Sales related to distribution activities totaled $78.5 million, an increase of 1.3% over the $77.5 million last year. This increase is due to the acquisition in March 2001 of certain assets of HFI Hardwood Flooring Inc., a hardwood-flooring distributor serving Western Canada.
These results combine strong performance in the hardwood segment, modest growth in distribution activities and a decrease in sales in the resilient flooring segment. The decline in the resilient segment was primarily in the residential sector, while sales of commercial resilient flooring remained constant. The softness in the residential market reflects the popularity among consumers of flooring surfaces such as wood and ceramic. Domco Tarkett is responding by developing new products that compete more effectively with these surfaces.
"Results for the year were negatively affected by global political and economic uncertainties as well as by the tragic events of 9/11. Despite this, our second half was stronger than last year's. Nonetheless, our performance is not yet where it should be. While we significantly increased our hardwood business we felt it was necessary to take decisive measures to improve the profitability of our resilient segment. As such, we undertook an aggressive cost reduction program and separated the resilient business into Domco Tarkett Residential and Domco Tarkett Commercial," stated Mattsson.
"The realigned divisions bring Domco and Tarkett together as a single team pursuing a single goal while maintaining its distinct brands and distribution networks. The new structure consolidates responsibility and decision-making within each division. It also improves our speed-to-market and facilitates timely product innovation. I believe this reorganization makes the best use of the considerable talents of all our people."
Mattsson said the economic outlook remains uncertain at least for the first half of the year. Nonetheless, Domco Tarkett has two principal objectives for fiscal 2002; to improve the profitability of its resilient business and to continue growing its successful hardwood business.