x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 52-1604305 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
160 S. Industrial Blvd., Calhoun, Georgia | 30701 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | x | Accelerated filer | ¨ | |
Non-accelerated filer | ¨ (Do not check if a smaller reporting company) | Smaller reporting company | ¨ |
Page No | ||
Part I. | ||
Item 1. | ||
Condensed Consolidated Balance Sheets as of June 29, 2013 and December 31, 2012 | ||
Condensed Consolidated Statements of Operations for the three months ended June 29, 2013 and June 30, 2012 | ||
Condensed Consolidated Statements of Operations for the six months ended June 29, 2013 and June 30, 2012 | ||
Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 29, 2013 and June 30, 2012 | ||
Condensed Consolidated Statements of Cash Flows for the six months ended June 29, 2013 and June 30, 2012 | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Part II. | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. |
June 29, 2013 | December 31, 2012 | |||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | 168,745 | 477,672 | |||
Receivables, net | 1,145,550 | 679,473 | ||||
Inventories | 1,591,552 | 1,133,736 | ||||
Prepaid expenses | 191,117 | 138,117 | ||||
Deferred income taxes | 134,489 | 111,585 | ||||
Other current assets | 38,742 | 9,463 | ||||
Total current assets | 3,270,195 | 2,550,046 | ||||
Property, plant and equipment, net | 2,594,256 | 1,692,852 | ||||
Goodwill | 1,690,622 | 1,385,771 | ||||
Tradenames | 680,107 | 455,503 | ||||
Other intangible assets subject to amortization, net | 120,422 | 98,296 | ||||
Deferred income taxes and other non-current assets | 153,362 | 121,216 | ||||
$ | 8,508,964 | 6,303,684 |
June 29, 2013 | December 31, 2012 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
Current liabilities: | ||||||
Current portion of long-term debt | $ | 83,171 | 55,213 | |||
Accounts payable and accrued expenses | 1,261,791 | 773,436 | ||||
Total current liabilities | 1,344,962 | 828,649 | ||||
Deferred income taxes | 452,822 | 329,810 | ||||
Long-term debt, less current portion | 2,450,584 | 1,327,729 | ||||
Other long-term liabilities | 156,303 | 97,879 | ||||
Total liabilities | 4,404,671 | 2,584,067 | ||||
Commitments and contingencies (Notes 9 and 15) | ||||||
Stockholders’ equity: | ||||||
Preferred stock, $.01 par value; 60 shares authorized; no shares issued | — | — | ||||
Common stock, $.01 par value; 150,000 shares authorized; 80,668 and 80,185 shares issued in 2013 and 2012, respectively | 807 | 802 | ||||
Additional paid-in capital | 1,544,085 | 1,277,521 | ||||
Retained earnings | 2,740,090 | 2,605,023 | ||||
Accumulated other comprehensive income, net | 49,806 | 159,733 | ||||
4,334,788 | 4,043,079 | |||||
Less treasury stock at cost; 8,155 and 11,032 shares in 2013 and 2012, respectively | 239,138 | 323,462 | ||||
Total Mohawk Industries, Inc. stockholders' equity | 4,095,650 | 3,719,617 | ||||
Noncontrolling interest | 8,643 | — | ||||
Total stockholders' equity | 4,104,293 | 3,719,617 | ||||
$ | 8,508,964 | 6,303,684 |
Three Months Ended | ||||||
June 29, 2013 | June 30, 2012 | |||||
Net sales | $ | 1,976,299 | 1,469,793 | |||
Cost of sales | 1,462,243 | 1,081,329 | ||||
Gross profit | 514,056 | 388,464 | ||||
Selling, general and administrative expenses | 380,858 | 280,746 | ||||
Operating income | 133,198 | 107,718 | ||||
Interest expense | 25,312 | 18,844 | ||||
Other expense (income) | (1,097 | ) | 440 | |||
Earnings from continuing operations before income taxes | 108,983 | 88,434 | ||||
Income tax expense | 23,240 | 15,246 | ||||
Earnings from continuing operations | 85,743 | 73,188 | ||||
Loss from discontinued operations, net of income tax benefit of $485 | (1,361 | ) | — | |||
Net earnings including noncontrolling interest | 84,382 | 73,188 | ||||
Net loss attributable to noncontrolling interest | (190 | ) | — | |||
Net earnings attributable to Mohawk Industries, Inc. | $ | 84,572 | 73,188 | |||
Basic earnings per share attributable to Mohawk Industries, Inc. | ||||||
Income from continuing operations | $ | 1.19 | 1.06 | |||
Loss from discontinued operations | (0.02 | ) | — | |||
Basic earnings per share attributable to Mohawk Industries, Inc. | $ | 1.17 | 1.06 | |||
Weighted-average common shares outstanding—basic | 72,406 | 68,984 | ||||
Diluted earnings per share attributable to Mohawk Industries, Inc. | ||||||
Income from continuing operations | $ | 1.18 | 1.06 | |||
Loss from discontinued operations | (0.02 | ) | — | |||
Diluted earnings per share attributable to Mohawk Industries, Inc. | $ | 1.16 | 1.06 | |||
Weighted-average common shares outstanding—diluted | 72,867 | 69,259 |
Six Months Ended | ||||||
June 29, 2013 | June 30, 2012 | |||||
Net sales | $ | 3,463,114 | 2,878,828 | |||
Cost of sales | 2,571,992 | 2,130,938 | ||||
Gross profit | 891,122 | 747,890 | ||||
Selling, general and administrative expenses | 671,082 | 568,196 | ||||
Operating income | 220,040 | 179,694 | ||||
Interest expense | 44,468 | 41,342 | ||||
Other expense (income) | 5,290 | (1,385 | ) | |||
Earnings from continuing operations before income taxes | 170,282 | 139,737 | ||||
Income tax expense | 33,972 | 25,537 | ||||
Earnings from continuing operations | 136,310 | 114,200 | ||||
Loss from discontinued operations, net of income tax benefit of $485 | (1,361 | ) | — | |||
Net earnings including noncontrolling interest | 134,949 | 114,200 | ||||
Net (loss) income attributable to noncontrolling interest | (118 | ) | 635 | |||
Net earnings attributable to Mohawk Industries, Inc. | $ | 135,067 | 113,565 | |||
Basic earnings per share attributable to Mohawk Industries, Inc. | ||||||
Income from continuing operations | $ | 1.92 | 1.65 | |||
Loss from discontinued operations | (0.02 | ) | — | |||
Basic earnings per share attributable to Mohawk Industries, Inc. | $ | 1.90 | 1.65 | |||
Weighted-average common shares outstanding—basic | 70,907 | 68,923 | ||||
Diluted earnings per share attributable to Mohawk Industries, Inc. | ||||||
Income from continuing operations | $ | 1.91 | 1.64 | |||
Loss from discontinued operations | (0.02 | ) | — | |||
Diluted earnings per share attributable to Mohawk Industries, Inc. | $ | 1.89 | 1.64 | |||
Weighted-average common shares outstanding—diluted | 71,405 | 69,204 |
Three Months Ended | Six Months Ended | |||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||
Net earnings including noncontrolling interest | $ | 84,382 | 73,188 | 134,949 | 114,200 | |||||||
Other comprehensive loss: | ||||||||||||
Foreign currency translation adjustments | (32,428 | ) | (120,116 | ) | (110,134 | ) | (65,155 | ) | ||||
Pension prior service cost and actuarial gain (loss) | (8 | ) | (37 | ) | 207 | (20 | ) | |||||
Other comprehensive loss | (32,436 | ) | (120,153 | ) | (109,927 | ) | (65,175 | ) | ||||
Comprehensive income (loss) | 51,946 | (46,965 | ) | 25,022 | 49,025 | |||||||
Comprehensive (loss) income attributable to the noncontrolling interest | (190 | ) | — | (118 | ) | 635 | ||||||
Comprehensive income (loss) attributable to Mohawk Industries, Inc. | $ | 52,136 | (46,965 | ) | 25,140 | 48,390 |
Six Months Ended | ||||||
June 29, 2013 | June 30, 2012 | |||||
Cash flows from operating activities: | ||||||
Net earnings | $ | 134,949 | 114,200 | |||
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||
Restructuring | 28,389 | 8,226 | ||||
Depreciation and amortization | 140,992 | 145,117 | ||||
Deferred income taxes | (16,253 | ) | 1,717 | |||
Loss (gain) on disposal of property, plant and equipment | 422 | (7 | ) | |||
Stock-based compensation expense | 9,498 | 8,399 | ||||
Changes in operating assets and liabilities, net of effects of acquisitions: | ||||||
Receivables, net | (172,457 | ) | (99,903 | ) | ||
Tax deposits | — | (31,820 | ) | |||
Inventories | (40,555 | ) | (52,486 | ) | ||
Accounts payable and accrued expenses | 47,120 | 16,000 | ||||
Other assets and prepaid expenses | (4,594 | ) | (6,313 | ) | ||
Other liabilities | (13,597 | ) | (7,554 | ) | ||
Net cash provided by operating activities | 113,914 | 95,576 | ||||
Cash flows from investing activities: | ||||||
Additions to property, plant and equipment | (146,097 | ) | (87,687 | ) | ||
Acquisitions, net of cash acquired | (449,464 | ) | — | |||
Investment in joint venture | — | (7,007 | ) | |||
Net cash used in investing activities | (595,561 | ) | (94,694 | ) | ||
Cash flows from financing activities: | ||||||
Payments on Senior Credit Facility | (878,634 | ) | (653,675 | ) | ||
Proceeds from Senior Credit Facility | 1,348,808 | 1,031,800 | ||||
Repayment of senior notes | — | (336,270 | ) | |||
Proceeds from 3.85% Senior Notes | 600,000 | — | ||||
Repayment of acquired debt | (895,127 | ) | — | |||
Net change in asset securitization borrowings | 20,000 | — | ||||
Payments on other debt | (22 | ) | (582 | ) | ||
Debt issuance costs | (5,815 | ) | (1,018 | ) | ||
Purchase of non-controlling interest | — | (35,000 | ) | |||
Distribution to non-controlling interest | — | (423 | ) | |||
Change in outstanding checks in excess of cash | (11,423 | ) | 1,739 | |||
Proceeds from stock transactions | 29,859 | 6,612 | ||||
Net cash provided by financing activities | 207,646 | 13,183 | ||||
Effect of exchange rate changes on cash and cash equivalents | (34,926 | ) | (6,547 | ) | ||
Net change in cash and cash equivalents | (308,927 | ) | 7,518 | |||
Cash and cash equivalents, beginning of period | 477,672 | 311,945 | ||||
Cash and cash equivalents, end of period | $ | 168,745 | 319,463 | |||
1. | Interim reporting |
• | A cash payment of $307,052; and |
• | 2,874 newly issued Shares for a value of $313,906. |
Enterprise value | $ | 1,522,731 | |
Assumed indebtedness | (901,773 | ) | |
Consideration transferred | $ | 620,958 | |
Working capital | $ | 384,134 | |
Property, plant and equipment, net | 779,148 | ||
Tradenames | 215,357 | ||
Customer relationships | 21,792 | ||
Equity method investments | 1,058 | ||
Goodwill | 262,613 | ||
Other long term assets | 16,114 | ||
Long-term debt, including current portion | (901,773 | ) | |
Other long-term liabilities | (72,143 | ) | |
Deferred tax liability | (79,132 | ) | |
Noncontrolling interest | (6,210 | ) | |
Consideration transferred | $ | 620,958 | |
Three Months Ended | Six Months Ended | ||||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | ||||||||||
Net Sales: | |||||||||||||
As reported | $ | 1,976,299 | 1,469,793 | 3,463,114 | 2,878,828 | ||||||||
Pro forma | $ | 1,976,299 | 1,760,068 | 3,725,595 | 3,422,020 | ||||||||
Net earnings from continuing operations attributable to Mohawk Industries, Inc.: | |||||||||||||
As reported | $ | 85,933 | 73,188 | 136,428 | 113,565 | ||||||||
Pro forma | $ | 100,741 | 84,956 | 159,150 | 113,755 | ||||||||
Basic earnings per share from continuing operations attributable to Mohawk Industries, Inc.: | |||||||||||||
As reported | $ | 1.19 | 1.06 | 1.92 | 1.65 | ||||||||
Pro forma | $ | 1.39 | 1.18 | 2.20 | 1.58 | ||||||||
Diluted earnings per share from continuing operations attributable to Mohawk Industries, Inc.: | |||||||||||||
As reported | $ | 1.18 | 1.06 | 1.91 | 1.64 | ||||||||
Pro forma | $ | 1.38 | 1.18 | 2.18 | 1.58 |
• | In connection with acquisition activity, the Company typically incurs costs associated with executing the transactions, integrating the acquired operations (which may include expenditures for consulting and the integration of systems and processes), and restructuring the combined company (which may include charges related to employees, assets and activities that will not continue in the combined company); and |
• | In connection with the Company's cost-reduction/productivity initiatives, it typically incurs costs and charges associated with site closings and other facility rationalization actions and workforce reductions. |
Three Months Ended | Six Months Ended | ||||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | ||||||||||
Cost of sales | |||||||||||||
Restructuring costs | $ | 11,324 | (a) | 6,636 | (b) | 14,330 | (a) | 6,636 | (b) | ||||
Acquisition transaction-related costs | — | — | — | — | |||||||||
Acquisition integration-related costs | 3,010 | — | 3,345 | — | |||||||||
Restructuring and integration-related costs | $ | 14,334 | 6,636 | 17,675 | 6,636 | ||||||||
Selling, general and administrative expenses | |||||||||||||
Restructuring costs | $ | 8,843 | (a) | 1,590 | (b) | 14,059 | (a) | 1,590 | (b) | ||||
Acquisition transaction-related costs | 13,812 | — | 13,812 | — | |||||||||
Acquisition integration-related costs | 4,331 | — | 5,630 | — | |||||||||
Restructuring, acquisition and integration-related costs | $ | 26,986 | 1,590 | 33,501 | 1,590 | ||||||||
Lease impairments | Asset write-downs | Severance | Other restructuring costs | Total | |||||||||||
Balance as of December 31, 2012 | $ | 7,457 | — | 2,898 | — | 10,355 | |||||||||
Provision - Carpet segment | — | — | 5,891 | 326 | 6,217 | ||||||||||
Provision - Ceramic segment | — | 37 | 8,169 | 426 | 8,632 | ||||||||||
Provision - Laminate and Wood segment | — | — | 12,803 | 737 | 13,540 | ||||||||||
Cash payments | (1,404 | ) | — | (9,606 | ) | (1,489 | ) | (12,499 | ) | ||||||
Non-cash items | — | (37 | ) | — | — | (37 | ) | ||||||||
Balance as of June 29, 2013 | $ | 6,053 | — | 20,155 | — | 26,208 |
June 29, 2013 | December 31, 2012 | |||||
Customers, trade | $ | 1,163,699 | 691,553 | |||
Other | 59,294 | 25,793 | ||||
1,222,993 | 717,346 | |||||
Less: allowance for discounts, returns, claims and doubtful accounts | 77,443 | 37,873 | ||||
Receivables, net | $ | 1,145,550 | 679,473 |
June 29, 2013 | December 31, 2012 | |||||
Finished goods | $ | 1,090,455 | 695,606 | |||
Work in process | 120,659 | 103,685 | ||||
Raw materials | 380,438 | 334,445 | ||||
Total inventories | $ | 1,591,552 | 1,133,736 |
Carpet segment | Ceramic segment | Laminate and Wood segment | Total | |||||||||
Balance as of December 31, 2012 | ||||||||||||
Goodwill | $ | 199,132 | 1,186,913 | 1,327,151 | 2,713,196 | |||||||
Accumulated impairment losses | (199,132 | ) | (531,930 | ) | (596,363 | ) | (1,327,425 | ) | ||||
$ | — | 654,983 | 730,788 | 1,385,771 | ||||||||
Goodwill acquired during the period | $ | — | 262,613 | 60,358 | 322,971 | |||||||
Currency translation during the period | $ | — | (6,772 | ) | (11,348 | ) | (18,120 | ) | ||||
Balance as of June 29, 2013 | ||||||||||||
Goodwill | $ | 199,132 | 1,442,754 | 1,376,161 | 3,018,047 | |||||||
Accumulated impairment losses | (199,132 | ) | (531,930 | ) | (596,363 | ) | (1,327,425 | ) | ||||
$ | — | 910,824 | 779,798 | 1,690,622 |
Indefinite life assets not subject to amortization: | Tradenames | ||
Balance as of December 31, 2012 | $ | 455,503 | |
Intangible assets acquired during the period | 232,191 | ||
Currency translation during the period | (7,587 | ) | |
Balance as of June 29, 2013 | $ | 680,107 |
Intangible assets subject to amortization: | Customer relationships | Patents | Other | Total | ||||||||
Balance as of December 31, 2012 | $ | 26,210 | 71,031 | 1,055 | 98,296 | |||||||
Intangible assets acquired during the period | 21,792 | 15,188 | — | 36,980 | ||||||||
Amortization during the period | (3,147 | ) | (9,541 | ) | (60 | ) | (12,748 | ) | ||||
Currency translation during the period | (310 | ) | (1,548 | ) | (248 | ) | (2,106 | ) | ||||
Balance as of June 29, 2013 | $ | 44,545 | 75,130 | 747 | 120,422 |
Three Months Ended | Six Months Ended | |||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||
Amortization expense | $ | 6,774 | 15,998 | 12,748 | 32,259 |
June 29, 2013 | December 31, 2012 | |||||
Outstanding checks in excess of cash | $ | 14,057 | 25,480 | |||
Accounts payable, trade | 729,034 | 387,871 | ||||
Accrued expenses | 244,929 | 180,039 | ||||
Product warranties | 33,674 | 32,930 | ||||
Accrued interest | 36,542 | 26,843 | ||||
Deferred tax liability | 14,255 | 6,309 | ||||
Income taxes payable | 5,308 | 2,074 | ||||
Accrued compensation and benefits | 183,992 | 111,890 | ||||
Total accounts payable and accrued expenses | $ | 1,261,791 | 773,436 |
Three Months Ended | Six Months Ended | |||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||
Balance at beginning of period | $ | 35,483 | 32,680 | 32,930 | 30,144 | |||||||
Warranty claims paid during the period | (16,306 | ) | (14,866 | ) | (29,607 | ) | (28,786 | ) | ||||
Acquisitions | 503 | — | 3,283 | — | ||||||||
Warranty expense during the period | 13,994 | 17,053 | 27,068 | 33,509 | ||||||||
Balance at end of period | $ | 33,674 | 34,867 | 33,674 | 34,867 |
Foreign currency translation adjustments | Pensions (1) | Total | |||||||
Balance as of December 31, 2012 | $ | 160,661 | (928 | ) | 159,733 | ||||
Current period other comprehensive income (loss) before reclassifications | (110,134 | ) | 207 | (109,927 | ) | ||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | — | — | ||||||
Balance as of June 29, 2013 | $ | 50,527 | (721 | ) | 49,806 |
Three Months Ended | Six Months Ended | |||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||
Foreign currency (gains) losses, net | $ | (767 | ) | (1,052 | ) | 3,032 | (6,702 | ) | ||||
All other, net | (330 | ) | 1,492 | 2,258 | 5,317 | |||||||
Total other expense (income) | $ | (1,097 | ) | 440 | 5,290 | (1,385 | ) |
Three Months Ended | Six Months Ended | |||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||
Earnings from continuing operations attributable to Mohawk Industries, Inc. | $ | 85,933 | 73,188 | 136,428 | 113,565 | |||||||
Weighted-average common shares outstanding-basic and diluted: | ||||||||||||
Weighted-average common shares outstanding—basic | 72,406 | 68,984 | 70,907 | 68,923 | ||||||||
Add weighted-average dilutive potential common shares—options and RSUs to purchase common shares, net | 461 | 275 | 498 | 281 | ||||||||
Weighted-average common shares outstanding-diluted | 72,867 | 69,259 | 71,405 | 69,204 | ||||||||
Earnings from continuing operations attributable to Mohawk Industries, Inc. | ||||||||||||
Basic | $ | 1.19 | 1.06 | 1.92 | 1.65 | |||||||
Diluted | $ | 1.18 | 1.06 | 1.91 | 1.64 |
Three Months Ended | Six Months Ended | ||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | ||||||||
Net sales: | |||||||||||
Carpet segment | $ | 770,868 | 734,493 | 1,466,202 | 1,434,373 | ||||||
Ceramic segment | 760,168 | 404,288 | 1,172,049 | 797,213 | |||||||
Laminate and Wood segment | 470,980 | 354,374 | 875,455 | 691,798 | |||||||
Intersegment sales | (25,717 | ) | (23,362 | ) | (50,592 | ) | (44,556 | ) | |||
$ | 1,976,299 | 1,469,793 | 3,463,114 | 2,878,828 | |||||||
Operating income (loss): | |||||||||||
Carpet segment | $ | 54,862 | 37,136 | 80,100 | 62,418 | ||||||
Ceramic segment | 46,304 | 36,432 | 76,280 | 62,460 | |||||||
Laminate and Wood segment | 41,362 | 40,575 | 80,055 | 67,721 | |||||||
Corporate and intersegment eliminations | (9,330 | ) | (6,425 | ) | (16,395 | ) | (12,905 | ) | |||
$ | 133,198 | 107,718 | 220,040 | 179,694 |
June 29, 2013 | December 31, 2012 | |||||
Assets: | ||||||
Carpet segment | $ | 1,803,212 | 1,721,214 | |||
Ceramic segment | 3,832,888 | 1,731,258 | ||||
Laminate and Wood segment | 2,691,553 | 2,672,389 | ||||
Corporate and intersegment eliminations | 181,311 | 178,823 | ||||
$ | 8,508,964 | 6,303,684 |
June 29, 2013 | December 31, 2012 | |||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | |||||||||
3.85% senior notes, payable January 31, 2023; interest payable semiannually | $ | 573,000 | 600,000 | — | — | |||||||
6.125% notes, payable January 15, 2016; interest payable semiannually | 990,900 | 900,000 | 1,011,600 | 900,000 | ||||||||
Five-year senior secured credit facility, due July 8, 2016 | 625,768 | 625,768 | 153,875 | 153,875 | ||||||||
Securitization facility | 300,000 | 300,000 | 280,000 | 280,000 | ||||||||
Industrial revenue bonds, capital leases and other | 107,987 | 107,987 | 49,067 | 49,067 | ||||||||
Total long-term debt | 2,597,655 | 2,533,755 | 1,494,542 | 1,382,942 | ||||||||
Less current portion | 83,171 | 83,171 | 55,213 | 55,213 | ||||||||
Long-term debt, less current portion | $ | 2,514,484 | 2,450,584 | 1,439,329 | 1,327,729 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. | Controls and Procedures |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. | Defaults Upon Senior Securities |
Item 4. | Mine Safety Disclosures |
Item 5. | Other Information |
Item 6. | Exhibits |
No. | Description | |
31.1 | Certification Pursuant to Rule 13a-14(a). | |
31.2 | Certification Pursuant to Rule 13a-14(a). | |
32.1 | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2 | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
MOHAWK INDUSTRIES, INC. | ||||
(Registrant) | ||||
Dated: | August 7, 2013 | By: | /s/ Jeffrey S. Lorberbaum | |
JEFFREY S. LORBERBAUM | ||||
Chairman and Chief Executive Officer | ||||
(principal executive officer) | ||||
Dated: | August 7, 2013 | By: | /s/ Frank H. Boykin | |
FRANK H. BOYKIN | ||||
Chief Financial Officer | ||||
(principal financial officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Mohawk Industries, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Jeffrey S. Lorberbaum |
Jeffrey S. Lorberbaum |
Chairman and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Mohawk Industries, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Frank H. Boykin |
Frank H. Boykin |
Chief Financial Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Jeffrey S. Lorberbaum |
Jeffrey S. Lorberbaum |
Chairman and Chief Executive Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Frank H. Boykin |
Frank H. Boykin |
Chief Financial Officer |
Accumulated Other Comprehensive Income (Notes)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
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Statement of Other Comprehensive Income [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income | Accumulated other comprehensive income Effective January 1, 2013, the Company adopted recently issued accounting guidance that requires the Company to separately disclose, on a prospective basis, the change in each component of other comprehensive income (loss) relating to reclassification adjustments and current period other comprehensive income (loss). As the guidance relates to presentation only, the adoption did not have a material impact on the Company's results of operations, financial position or cash flows. The changes in accumulated other comprehensive income by component, net of tax, for the first quarter of 2013 are as follows:
(1) This accumulated other comprehensive income (loss) component is included in the computation of net periodic pension cost (refer to Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2012). |
Other expense (income) (Summary of other expense (income)) (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 29, 2013
|
Jun. 30, 2012
|
Jun. 29, 2013
|
Jun. 30, 2012
|
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Component Of Other Expense (Income) Nonoperating [Line Items] | ||||
Total other expense (income) | $ (1,097) | $ 440 | $ 5,290 | $ (1,385) |
Foreign Currency (Gains) Losses, Net [Member]
|
||||
Component Of Other Expense (Income) Nonoperating [Line Items] | ||||
Total other expense (income) | (767) | (1,052) | 3,032 | (6,702) |
All Other, Net [Member]
|
||||
Component Of Other Expense (Income) Nonoperating [Line Items] | ||||
Total other expense (income) | $ (330) | $ 1,492 | $ 2,258 | $ 5,317 |
Condensed Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 29, 2013
|
Jun. 30, 2012
|
Jun. 29, 2013
|
Jun. 30, 2012
|
|
Income Statement [Abstract] | ||||
Net sales | $ 1,976,299 | $ 1,469,793 | $ 3,463,114 | $ 2,878,828 |
Cost of sales | 1,462,243 | 1,081,329 | 2,571,992 | 2,130,938 |
Gross profit | 514,056 | 388,464 | 891,122 | 747,890 |
Selling, general and administrative expenses | 380,858 | 280,746 | 671,082 | 568,196 |
Operating income | 133,198 | 107,718 | 220,040 | 179,694 |
Interest expense | 25,312 | 18,844 | 44,468 | 41,342 |
Other expense (income) | (1,097) | 440 | 5,290 | (1,385) |
Earnings before income taxes | 108,983 | 88,434 | 170,282 | 139,737 |
Income tax expense | 23,240 | 15,246 | 33,972 | 25,537 |
Net earnings | 85,743 | 73,188 | 136,310 | 114,200 |
Loss from discontinued operations, net of income tax benefit of $485 | (1,361) | 0 | (1,361) | 0 |
Net earnings including noncontrolling interest | 84,382 | 73,188 | 134,949 | 114,200 |
Less: Net earnings attributable to noncontrolling interest | (190) | 0 | (118) | 635 |
Net earnings attributable to Mohawk Industries, Inc. | $ 84,572 | $ 73,188 | $ 135,067 | $ 113,565 |
Income from continuing operations | $ 1.19 | $ 1.06 | $ 1.92 | $ 1.65 |
Loss from discontinued operations | $ (0.02) | $ 0.00 | $ (0.02) | $ 0.00 |
Basic earnings per share attributable to Mohawk Industries, Inc. (in usd per share) | $ 1.17 | $ 1.06 | $ 1.90 | $ 1.65 |
Weighted-average common shares outstanding-basic (in shares) | 72,406 | 68,984 | 70,907 | 68,923 |
Income from continuing operations | $ 1.18 | $ 1.06 | $ 1.91 | $ 1.64 |
Loss from discontinued operations | $ (0.02) | $ 0.00 | $ (0.02) | $ 0.00 |
Diluted earnings per share attributable to Mohawk Industries, Inc. (in usd per share) | $ 1.16 | $ 1.06 | $ 1.89 | $ 1.64 |
Weighted-average common shares outstanding-diluted (in shares) | 72,867 | 69,259 | 71,405 | 69,204 |
Restructuring, Acquisition and Related Costs Restructuring, Acquisition, and Related Costs
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
|
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring, Acquisition, and Related Costs | Restructuring, acquisition and integration-related costs The Company incurs costs in connection with acquiring, integrating and restructuring acquisitions and in connection with its global cost-reduction/productivity initiatives. For example:
Restructuring, acquisition and integration-related costs consisted of the following during the three and six months ended June 29, 2013 and June 30, 2012:
(a) The restructuring costs for 2013 primarily relate to the Company’s actions taken to lower its cost structure and improve efficiencies of manufacturing operations and administrative functions, as well as actions related to the Company's acquisition of Pergo, Spano and Marazzi. (b) The charges for 2012 primarily relate to the Company's actions taken to to lower its cost structure and improve efficiencies of manufacturing and distribution operations as the Company adjusted to changing economic conditions. The restructuring activity for the six months ended June 29, 2013 is as follows:
The Company expects the remaining lease impairments, severance and other restructuring costs to be paid over the next four years. |
Fair value
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
|
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value | Fair Value ASC 825-10, formerly the FASB Staff Position FAS 107-1 and Accounting Principles Board Opinion 28-1, “Interim Disclosures About Fair Value of Financial Instruments”, requires disclosures about fair value of financial instruments in interim reporting periods of publicly-traded companies. The fair values and carrying values of our debt instruments are detailed as follows:
The fair values of the Company’s debt instruments were estimated using market observable inputs, including quoted prices in active markets, market indices and interest rate measurements. Within the hierarchy of fair value measurements, these are Level 2 fair values. The carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued expenses approximate their fair values because of the relatively short-term maturities of these instruments. |
Commitments, contingencies and other (Narrative) (Details)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | 0 Months Ended | 3 Months Ended | 1 Months Ended | 0 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 29, 2013
Cost of Sales [Member]
USD ($)
|
Jun. 30, 2012
Cost of Sales [Member]
USD ($)
|
Jun. 29, 2013
Cost of Sales [Member]
USD ($)
|
Jun. 30, 2012
Cost of Sales [Member]
USD ($)
|
Jan. 30, 2013
BELGIUM
Foreign Tax Authority [Member]
EUR (€)
|
Jun. 30, 2012
BELGIUM
Foreign Tax Authority [Member]
EUR (€)
|
Dec. 28, 2012
BELGIUM
Foreign Tax Authority [Member]
EUR (€)
|
Jan. 31, 2012
BELGIUM
Foreign Tax Authority [Member]
Two Thousand and Eight [Member]
EUR (€)
|
Dec. 28, 2012
BELGIUM
Foreign Tax Authority [Member]
Two Thousand and Five [Member]
EUR (€)
|
Dec. 28, 2012
BELGIUM
Foreign Tax Authority [Member]
Two Thousand and Nine [Member]
EUR (€)
|
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Commitments And Contingencies [Line Items] | ||||||||||||||||||
Assessment received from Belgian tax authority (in euros) | € 23,789 | € 46,135 | € 35,567 | |||||||||||||||
Interest on assessment (in euros) | 2,912 | |||||||||||||||||
Refund of interest deposit | 2,912 | 23,789 | ||||||||||||||||
Interest Tax Examination, Refund, Interest Income | 1,583 | |||||||||||||||||
Pre-tax business restructuring charges | $ 11,324 | [1] | $ 6,636 | [2] | $ 14,330 | [1] | $ 6,636 | [2] | ||||||||||
|
Stock-based compensation
|
6 Months Ended |
---|---|
Jun. 29, 2013
|
|
Share-based Compensation [Abstract] | |
Stock-based compensation | Stock-based compensation The Company recognizes compensation expense for all share-based payments granted based on the grant-date fair value estimated in accordance with the provisions of the Financial Accounting Standards Board Accounting Standards Codification topic (“ASC”) 718-10. Compensation expense is recognized on a straight-line basis over the options’ or other awards’ estimated lives for fixed awards with ratable vesting provisions. Under the Company’s 2012 Incentive Plan (“2012 Plan”), the Company's principal stock compensation plan as of May 9, 2012, the Company reserved up to a maximum of 3,200 shares of common stock for issuance upon the grant or exercise of stock options, restricted stock, restricted stock units (“RSUs”) and other types of awards, to directors and key employees through 2022. Option awards are granted with an exercise price equal to the market price of the Company’s common stock on the date of the grant and generally vest between three and five years with a 10-year contractual term. Restricted stock and RSUs are granted with a price equal to the market price of the Company’s common stock on the date of the grant and generally vest between three and five years. The Company did not grant any options for the three or six months ended June 29, 2013. The Company granted 83 options to employees at a weighted-average grant-date fair value of $28.71 per share for the six months ended June 30, 2012. The Company recognized stock-based compensation costs related to stock options of $251 ($159 net of taxes) and $518 ($328 net of taxes) for the three months ended June 29, 2013 and June 30, 2012, respectively, which has been allocated to cost of sales and selling, general and administrative expenses. The Company recognized stock-based compensation costs related to stock options of $856 ($542 net of taxes) and $1,132 ($717 net of taxes) for the six months ended June 29, 2013 and June 30, 2012, respectively, which has been allocated to cost of sales and selling, general and administrative expenses. Pre-tax unrecognized compensation expense for stock options granted to employees and outside directors, net of estimated forfeitures, was $1,501 as of June 29, 2013, and will be recognized as expense over a weighted-average period of approximately 1.6 years. The fair value of the option award is estimated on the date of grant using the Black-Scholes-Merton valuation model. Expected volatility is based on the historical volatility of the Company’s common stock. The Company uses historical data to estimate option exercise and forfeiture rates within the valuation model. The Company granted 93 RSU's at a weighted-average grant-date fair value of $106.45 per unit for the three months ended June 29, 2013. The Company did not grant any RSU's for the three months ended June 30, 2012. The Company granted 299 and 261 RSUs at a weighted-average grant-date fair value of $110.10 and $65.98 per unit for the six months ended June 29, 2013 and June 30, 2012, respectively. The Company recognized stock-based compensation costs related to the issuance of RSUs of $3,744 ($2,372 net of taxes) and $2,311 ($1,464 net of taxes) for the three months ended June 29, 2013 and June 30, 2012, respectively, which has been allocated to selling, general and administrative expenses and cost of sales. The Company recognized stock-based compensation costs related to the issuance of RSUs of $8,642 ($5,475 net of taxes) and $7,248 ($4,592 net of taxes) for the six months ended June 29, 2013 and June 30, 2012, respectively, which has been allocated to selling, general and administrative expenses and cost of sales. Pre-tax unrecognized compensation expense for unvested RSUs granted to employees, net of estimated forfeitures, was $38,193 as of June 29, 2013, and will be recognized as expense over a weighted-average period of approximately 3.1 years. The Company did not grant any restricted stock awards for the three and six months ended June 29, 2013 or June 30, 2012. Compensation expense for restricted stock awards for the three and six months ended June 29, 2013 and June 30, 2012, respectively, was not significant. |
Goodwill and intangible assets (Narrative)(Details) (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 29, 2013
|
Dec. 31, 2012
|
May 03, 2013
Spano Invest NV [Member]
|
Jan. 10, 2013
Pergo [Member]
|
Apr. 03, 2013
Marrazzi Group [Member]
|
---|---|---|---|---|---|
Goodwill [Line Items] | |||||
Goodwill | $ 1,690,622 | $ 1,385,771 | $ 35,857 | $ 24,501 | $ 262,613 |
Debt (Senior Credit Facility) (Details) (USD $)
|
0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 08, 2011
Senior Credit Facility [Member]
|
Jun. 29, 2013
Senior Credit Facility [Member]
|
Jan. 20, 2012
Incremental Senior Credit Facility [Member]
|
Jun. 29, 2013
Five-Year Senior, Secured, Revolving Credit Facility [Member]
|
Jan. 20, 2012
Amendment To The Senior Credit Facility [Member]
|
Jun. 29, 2013
Amendment To The Senior Credit Facility [Member]
|
Jan. 20, 2012
Eight Scheduled Quarterly [Member]
Incremental Senior Credit Facility [Member]
|
Jan. 20, 2012
Four Scheduled Quarterly [Member]
Incremental Senior Credit Facility [Member]
|
Jun. 29, 2013
Minimum [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Maximum [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative A [Member]
Minimum [Member]
Libor [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative A [Member]
Maximum [Member]
Libor [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative B [Member]
Federal Funds [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative B [Member]
Monthly Libor [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative B [Member]
Minimum [Member]
Libor [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Alternative B [Member]
Maximum [Member]
Libor [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Standby Letters of Credit Guaranteeing Company Industrial Revenue Bonds [Member]
Senior Credit Facility [Member]
|
Jun. 29, 2013
Standby Letters of Credit Related to Various Insurance Contracts and Foreign Vendor Commitments [Member]
Senior Credit Facility [Member]
|
|
Line of Credit Facility [Line Items] | ||||||||||||||||||
Credit facility, initiation date | Jul. 08, 2011 | Jan. 20, 2012 | ||||||||||||||||
Term of line of credit (years) | 5 years | |||||||||||||||||
Maximum borrowing capacity under credit facility | $ 900,000,000 | $ 150,000,000 | ||||||||||||||||
Payment of financing costs | 8,285,000 | 1,018,000 | ||||||||||||||||
Unamortized financing costs | 12,277,000 | |||||||||||||||||
Quarterly principal payments | 5,625,000 | 1,875,000 | 3,750,000 | |||||||||||||||
Basis spread on debt instrument | 1.25% | 2.00% | 0.50% | 1.00% | 0.25% | 1.00% | ||||||||||||
Commitment fee percentage | 0.25% | 0.40% | ||||||||||||||||
Consolidated interest coverage ratio | 3.0 | |||||||||||||||||
Consolidated net leverage ratio | 3.75 | |||||||||||||||||
Amount utilized from long-term lines of credit | 582,239,000 | |||||||||||||||||
Available amount under credit facility | 317,761,000 | |||||||||||||||||
Utilized borrowings under credit facility | 485,143,000 | |||||||||||||||||
Standby letters of credit for various insurance contracts and commitments to foreign vendors | $ 46,823,000 | $ 50,273,000 |
Acquisitions Acquisitions (Assets Acquired and Liabilities Assumed) (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 29, 2013
|
Dec. 31, 2012
|
Apr. 03, 2013
Marrazzi Group [Member]
|
Apr. 03, 2013
Trademarks [Member]
Marrazzi Group [Member]
|
---|---|---|---|---|
Business Acquisition [Line Items] | ||||
Enterprise value | $ 1,522,731 | |||
Assumed indebtedness | 901,773 | |||
Consideration transferred | 620,958 | |||
Working capital | 384,134 | |||
Property, plant and equipment, net | 779,148 | |||
Tradenames | 215,357 | |||
Equity method investments | 1,058 | |||
Goodwill | 1,690,622 | 1,385,771 | 262,613 | |
Other long term assets | 16,114 | |||
Long-term debt, including current portion | 901,773 | |||
Other long-term liabilities | 72,143 | |||
Deferred tax liability | 79,132 | |||
Noncontrolling interest | 6,210 | |||
Consideration transferred | $ 620,958 |
Receivables, net (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
|
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net components of receivables | Receivables, net are as follows:
|
Restructuring, Acquisition and Related Costs Restructuring, Acquisition, and Related Costs (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | Restructuring, acquisition and integration-related costs consisted of the following during the three and six months ended June 29, 2013 and June 30, 2012:
(a) The restructuring costs for 2013 primarily relate to the Company’s actions taken to lower its cost structure and improve efficiencies of manufacturing operations and administrative functions, as well as actions related to the Company's acquisition of Pergo, Spano and Marazzi. (b) The charges for 2012 primarily relate to the Company's actions taken to to lower its cost structure and improve efficiencies of manufacturing and distribution operations as the Company adjusted to changing economic conditions. |
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Schedule of Restructuring and Related Costs | The restructuring activity for the six months ended June 29, 2013 is as follows:
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Earnings per share (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per share |
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Restructuring, Acquisition and Related Costs Restructuring and Related Costs by Type of Cost (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 29, 2013
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Jun. 30, 2012
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Jun. 29, 2013
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Jun. 30, 2012
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Apr. 03, 2013
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Restructuring Cost and Reserve [Line Items] | |||||||||||||
Provision | $ 28,389 | $ 8,226 | |||||||||||
Cost of Sales [Member]
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Restructuring Cost and Reserve [Line Items] | |||||||||||||
Restructuring Reserve, Period Increase (Decrease) | 11,324 | [1] | 6,636 | [2] | 14,330 | [1] | 6,636 | [2] | |||||
Acquisition transaction-related costs | 0 | ||||||||||||
Acquisition transaction-related costs | 0 | 0 | |||||||||||
Acquisition integration-related costs | 3,010 | 0 | 3,345 | 0 | |||||||||
Provision | 14,334 | 6,636 | 17,675 | 6,636 | |||||||||
Selling, General and Administrative Expenses [Member]
|
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Restructuring Cost and Reserve [Line Items] | |||||||||||||
Restructuring Reserve, Period Increase (Decrease) | 8,843 | [1] | 1,590 | [2] | 14,059 | [1] | 1,590 | [2] | |||||
Acquisition transaction-related costs | 13,812 | 13,812 | |||||||||||
Acquisition integration-related costs | 4,331 | 0 | 5,630 | 0 | |||||||||
Provision | $ 26,986 | $ 1,590 | $ 33,501 | $ 1,590 | |||||||||
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Accounts payable and accrued expenses (Components of accounts payable and accrued expenses) (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 29, 2013
|
Dec. 31, 2012
|
---|---|---|
Payables and Accruals [Abstract] | ||
Outstanding checks in excess of cash | $ 14,057 | $ 25,480 |
Accounts payable, trade | 729,034 | 387,871 |
Accrued expenses | 244,929 | 180,039 |
Product warranties | 33,674 | 32,930 |
Accrued interest | 36,542 | 26,843 |
Deferred tax liability | 14,255 | 6,309 |
Income taxes payable | 5,308 | 2,074 |
Accrued compensation and benefits | 183,992 | 111,890 |
Total accounts payable and accrued expenses | $ 1,261,791 | $ 773,436 |
Product warranties (Tables)
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
|
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Product Warranties Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for warranty obligations | The activity related to warranty obligations is as follows:
|
Inventories (Net components of inventories) (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 29, 2013
|
Dec. 31, 2012
|
---|---|---|
Inventory Disclosure [Abstract] | ||
Finished goods | $ 1,090,455 | $ 695,606 |
Work in process | 120,659 | 103,685 |
Raw materials | 380,438 | 334,445 |
Total inventories | $ 1,591,552 | $ 1,133,736 |
Acquisitions Acquisitions (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 29, 2013
|
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The components of the preliminary purchase price allocation for Marazzi are as follows (in thousands):
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Business Acquisition, Pro Forma Information | The following unaudited pro forma consolidated results of operations have been prepared as if the Marazzi acquisition occurred as of January 1, 2012 (amounts in thousands, except per share data):
|
Condensed Consolidated Statements of Comprehensive Income (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 29, 2013
|
Jun. 30, 2012
|
Jun. 29, 2013
|
Jun. 30, 2012
|
|
Statement of Stockholders' Equity [Abstract] | ||||
Net earnings | $ 84,382 | $ 73,188 | $ 134,949 | $ 114,200 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (32,428) | (120,116) | (110,134) | (65,155) |
Pension prior service cost and actuarial gain (loss) | (8) | (37) | 207 | (20) |
Other comprehensive income (loss) | (32,436) | (120,153) | (109,927) | (65,175) |
Comprehensive income (loss) | 51,946 | (46,965) | 25,022 | 49,025 |
Less: comprehensive income attributable to the noncontrolling interest | (190) | 0 | (118) | 635 |
Comprehensive income (loss) attributable to Mohawk Industries, Inc. | $ 52,136 | $ (46,965) | $ 25,140 | $ 48,390 |
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