UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 17, 2011

MOHAWK INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or Other Jurisdiction of Incorporation)		01 13697 (Commission File Number)		52-1604305 (IRS Employer Identification No.)

160 South Industrial Blvd., Calhoun, Georgia (Address of Principal Executive Offices)		30701 (Zip Code)

Registrant’s telephone number, including area code (706) 629-7721

(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o		Written communication pursuant to Rule 425 under Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act CFR 240.17R 240.13e-4(c))

 

 

Item 2.02 Results of Operations and Financial Condition.

The following information, including the Exhibit attached hereto, is being furnished pursuant to this Item 2.02 and shall not be deemed “filed” for purpose of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

On February 22, 2011, Mohawk Industries, Inc. (the “Company”), issued a press release announcing its fourth quarter financial results. A copy of the press release is attached hereto and hereby incorporated by reference as Exhibit 99.1.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 17, 2011, Mr. Robert N. Pokelwaldt notified the Board of Directors of the Company of his decision to retire and not stand for re-election as a director of the Company at the 2011 Annual Meeting of Stockholders to be held in May 2011. Mr. Pokelwaldt will continue to serve on the Board of Directors of the Company for the remainder of his current term.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

	99.1			Press release dated February 22, 2011.

SIGNATURES

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.

INDEX TO EXHIBITS

Exhibit
	99.1.			Press release dated February 22, 2011.

Exhibit 99.1

Mohawk Industries, Inc. Announces Fourth Quarter Earnings

CALHOUN, Ga., Feb. 22, 2011 /PRNewswire via COMTEX/ —

Mohawk Industries, Inc. (NYSE: MHK) today announced 2010 fourth quarter net earnings of $46 million and diluted earnings per share (EPS) of $0.66. For the fourth quarter of 2009, the net earnings were $20 million and EPS was $0.29. Excluding unusual items, 2009 fourth quarter net earnings and EPS were $39 million and $0.56 per share. Net sales for the fourth quarter of 2010 were $1.3 billion which was a decrease of approximately 6% versus 2009. Net sales for the quarter increased 2% over the prior year on a constant days and exchange rate basis. For the full year of 2010, our net earnings were $185 million and EPS was $2.65. For the full year of 2009, our net loss was $5 million and loss per share was $0.08. Net sales for the full year of 2010 were $5.3 billion representing a slight decrease from 2009. On a constant exchange rate and excluding 2009 sales adjustments, net sales decreased 2%. Our cash position and liquidity remain strong with over $500 million available immediately after retiring $300 million of bonds in January 2011.

Commenting on the fourth quarter results, Jeffrey S. Lorberbaum, Chairman and CEO stated, “Our earnings exceeded our expectations as results were positively impacted by enhanced manufacturing efficiencies, benefits from restructuring actions, reducing SG&A costs and improved process consistency. Our operating margin of 6.8% continues to show improvement compared to last year despite rising raw material costs. During 2010, our emphasis on innovation, new products, manufacturing improvements and cost reduction have benefited our margins and increased earnings. Investments in the Russian, Chinese and Mexican flooring markets are expanding our international presence and will provide platforms for future revenue and profit growth. The consensus among economists is that these markets will outperform the more mature U.S. and Western European flooring markets. The U.S. industry decline experienced over the past few years appears to have bottomed with some markets showing signs of improvement.”

After adjusting for the lower number of days in the quarter, our Mohawk segment net sales decreased 3% but achieved the highest operating margin in two years despite increasing raw material costs. Manufacturing costs, material yields and process controls have improved from last year. Our market position, after adjusting for the number of days in the period, stabilized in the fourth quarter as we accelerated key introductions in new residential polyester carpets and commercial carpet tile products. We implemented a 7-10% carpet price increase in February to offset our raw material inflation. Sales of our commercial carpet tile continue to grow supported by a broader product offering and an expanded sales force. Improved planning and inventory processes have enhanced our service levels, reducing delivery time and costs.

Our Dal-Tile segment net sales declined 4% as reported but increased 4% after adjusting for the lower number of days this period and a constant exchange rate. In the fourth quarter, we began implementing a price increase of 1-2% to cover rising transportation costs. We have added sales personnel focusing on large commercial accounts and housing contractors to maximize participation in these improving markets. Dal-Tile is leading the industry with advances in decorating technologies created by our Reveal Imaging. We are introducing products that have greater distinction between individual tiles, stronger natural visuals and new textures. We are increasing our Mexican sales and customer base by expanding our product selection and sales force. Our joint venture in China is broadening its product offering, implementing new production technology and supplying tile to existing Mohawk markets. The investment in China will position us long term to take advantage of this growing market.

Our Unilin revenues were flat in the period as reported, but increased 14% after adjusting for the number of days in the period and the exchange rate. Our margins remain compressed as our material costs have continued to escalate. We implemented price increases in our board products in the fourth quarter and are executing additional price increases in boards, laminate and roofing in the first quarter to recover continued inflation and improve margins. Our laminate flooring business is increasing with Northern Europe, Russia and Asia out-performing. We are expanding our home center participation by leveraging our technology and styling leadership. The introduction of new furniture finishes and high definition technology continues to affirm our leadership in laminate technology. We are proceeding with construction of our Russian laminate plant and expanding our Malaysian wood manufacturing.

The economic recovery and stronger consumer spending will positively impact our industry in 2011. The seasonally slow first quarter is being affected by harsh weather and increasing raw material costs offsetting savings from our cost initiatives. The Chinese joint venture’s extended holiday shutdown will unfavorably impact our first quarter. The residential remodeling market should improve with increased consumer spending and higher home sales. Commercial remodeling is growing as businesses invest to maximize their operating results. For the balance of 2011, we anticipate an improvement in our results as price increases are implemented, volume expands and the recovery continues. With these factors, our first quarter guidance for earnings is $0.36 to $0.44 per share, excluding restructuring charges.

We remain committed to enhancing our organization to drive innovation in product, processes and costs. Advances in our marketing, product introductions, manufacturing efficiencies, and service should yield higher profitability. This year, a higher level of capital investments will improve productivity, support new product development and expand our global reach.

Mohawk is a leading supplier of flooring for both residential and commercial applications. Mohawk offers a complete selection of carpet, ceramic tile, laminate, wood, stone, vinyl, and rugs. These products are marketed under the premier brands in the industry, which include Mohawk, Karastan, Lees, Bigelow, Dal-Tile, American Olean, Unilin and Quick Step. Mohawk’s unique merchandising and marketing assist our customers in creating the consumers’ dream. Mohawk provides a premium level of service with its own trucking fleet and local distribution.

Certain of the statements in the immediately preceding paragraphs, particularly anticipating future performance, business prospects, growth and operating strategies and similar matters and those that include the words “could,” “should,” “believes,” “anticipates,” “expects,” and “estimates,” or similar expressions constitute “forward-looking statements.” 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. There can be no assurance that the forward-looking statements will be accurate because they are based on many assumptions, which involve risks and uncertainties. The following important factors could cause future results to differ: changes in economic or industry conditions; competition; raw material and energy costs; timing and level of capital expenditures; integration of acquisitions; rationalization of operations; claims; litigation and other risks identified in Mohawk’s SEC reports and public announcements.

There will be a conference call Wednesday, February 23, 2011 at 11:00 AM Eastern Time.

The telephone number to call is 1-800-603-9255 for US/Canada and 1-706-634-2294 for International/Local. Conference ID # 38370453. A conference call replay will also be available until March 9, 2011 by dialing 800-642-1687 for US/local calls and 706-645-9291 for International/Local calls and entering Conference ID # 38370453.

MOHAWK INDUSTRIES, INC. AND SUBSIDIARIES

Consolidated Statement of Operations		Three Months Ended								Twelve Months Ended
(Amounts in thousands, except per share data)		December 31, 2010				December 31, 2009				December 31, 2010				December 31, 2009
Net sales		$	1,262,198				1,347,108				5,319,072				5,344,024
Cost of sales			920,532				1,005,414				3,916,472				4,111,794
Gross profit			341,666				341,694				1,402,600				1,232,230
Selling, general and administrative expenses			256,026				294,829				1,088,431				1,188,500
Operating income			85,640				46,865				314,169				43,730
Interest expense			30,166				34,527				133,151				127,031
Other (income) expense, net			(1,324	)			1,509				(7,166	)			(1,108	)
Earnings (loss) before income taxes			56,798				10,829				188,184				(82,193	)
Income tax expense (benefit)			11,040				(8,950	)			2,713				(76,694	)
Net earnings (loss)		$	45,758				19,779				185,471				(5,499	)
Basic earnings (loss) per share (1)		$	0.67				0.29				2.66				(0.08	)
Weighted-average common shares outstanding — basic			68,612				68,472				68,578				68,452
Diluted earnings (loss) per share (1)		$	0.66				0.29				2.65				(0.08	)
Weighted-average common shares outstanding — diluted			68,843				68,682				68,784				68,452

Other Financial Information

(Amounts in thousands)

Net cash provided by operating activities		$	109,318				259,611				319,712				672,205
Depreciation and amortization		$	74,522				81,827				296,773				303,004
Capital expenditures		$	69,940				37,644				156,180				108,925

Consolidated Balance Sheet Data

(Amounts in thousands)

		December 31, 2010				December 31, 2009
ASSETS
Current assets:
Cash and cash equivalents		$	354,217				531,458
Restricted cash			27,954				—
Receivables, net			614,473				673,931
Inventories			1,007,503				892,981
Prepaid expenses			91,731				108,947
Deferred income taxes and other current assets			152,735				151,683
Total current assets			2,248,613				2,359,000
Property, plant and equipment, net			1,687,124				1,791,412
Goodwill			1,369,394				1,411,128
Intangible assets, net			677,127				785,342
Deferred income taxes and other non-current assets			116,668				44,564
		$	6,098,926				6,391,446
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt		$	350,588				52,907
Accounts payable and accrued expenses			698,326				831,115
Total current liabilities			1,048,914				884,022
Long-term debt, less current portion			1,302,994				1,801,572
Deferred income taxes and other long-term liabilities			440,021				471,570
Total liabilities			2,791,929				3,157,164
Noncontrolling interest			35,441				33,459
Total stockholders’ equity			3,271,556				3,200,823
		$	6,098,926				6,391,446

Segment Information		As of or for the Three Months Ended								As of or for the Twelve Months Ended
(Amounts in thousands)		December 31, 2010				December 31, 2009				December 31, 2010				December 31, 2009
Net sales:
Mohawk		$	667,230				738,716				2,844,876				2,856,741
Dal-Tile			317,354				329,985				1,367,442				1,426,757
Unilin			297,415				298,331				1,188,274				1,128,315
Intersegment sales			(19,801	)			(19,924	)			(81,520	)			(67,789	)
Consolidated net sales		$	1,262,198				1,347,108				5,319,072				5,344,024
Operating income (loss):
Mohawk		$	48,804				16,269				122,904				(125,965	)
Dal-Tile			19,902				11,528				97,334				84,154
Unilin			20,864				25,331				114,298				105,953
Corporate and eliminations			(3,930	)			(6,263	)			(20,367	)			(20,412	)
Consolidated operating income		$	85,640				46,865				314,169				43,730
Assets:
Mohawk										$	1,637,319				1,582,652
Dal-Tile											1,644,448				1,546,393
Unilin											2,475,049				2,598,182
Corporate and eliminations											342,110				664,219
Consolidated assets										$	6,098,926				6,391,446

Reconciliation of Net Earnings to Adjusted Net Earnings and Adjusted Diluted Earnings Per Share

(Amounts in thousands, except per share data)

		Three Months Ended
		December 31, 2009
Net earnings		$	19,779
Unusual items:
Business restructurings			29,787
Income taxes			(10,872	)
Adjusted net earnings		$	38,694
Adjusted diluted earnings per share		$	0.56
Weighted-average common shares outstanding — diluted			68,682

Reconciliation of Net Sales to Adjusted Net Sales

(Amounts in thousands)

		Three Months Ended								Twelve Months Ended
		December 31, 2010				December 31, 2009				December 31, 2010				December 31, 2009
Net sales		$	1,262,198				1,347,108				5,319,072				5,344,024
Adjustments to net sales
Commercial carpet tile reserve			—				—				—				121,224
Impact of shipping days			95,145				—				—				—
Exchange rate			18,557				—				36,588				—
Adjusted net sales		$	1,375,900				1,347,108				5,355,660				5,465,248

Reconciliation of Segment Net Sales to Adjusted Segment Net Sales

(Amounts in thousands)

		Three Months Ended
Mohawk segment		December 31, 2010				December 31, 2009
Net sales		$	667,230				738,716
Adjustments to net sales
Impact of shipping days			46,100				—
Adjusted net sales		$	713,330				738,716
Dal-Tile segment
Net sales		$	317,354				329,985
Adjustments to net sales
Impact of shipping days			26,445				—
Exchange rate			(1,592	)			—
Adjusted net sales		$	342,207				329,985
Unilin segment
Net sales		$	297,415				298,331
Adjustments to net sales
Impact of shipping days			22,600				—
Exchange rate			20,149				—
Adjusted net sales		$	340,164				298,331

Reconciliation of Gross Profit to Adjusted Gross Profit

(Amounts in thousands)

		Three Months Ended
		December 31, 2010				December 31, 2009
Gross profit		$	341,666				341,694
Adjustments to gross profit
Business restructurings			—				22,295
Adjusted gross profit		$	341,666				363,989
Adjusted gross margin as a percent of net sales			27.1	%			27.0	%

Reconciliation of Selling, General and Administrative Expenses to Adjusted Selling, General and Administrative Expenses

(Amounts in thousands)

		Three Months Ended
		December 31, 2010				December 31, 2009
Selling, general and administrative expenses		$	256,026				294,829
Adjustments to selling, general and administrative expenses
Business restructurings			—				7,492
Adjusted selling, general and administrative expenses		$	256,026				302,321
Adjusted selling, general and administrative expenses as a percent of net sales			20.3	%			22.4	%

Reconciliation of Operating Income to Adjusted Operating Income

(Amounts in thousands)

		Three Months Ended
		December 31, 2010				December 31, 2009
Operating income		$	85,640				46,865
Adjustments to operating income
Business restructurings			—				29,787
Adjusted operating income		$	85,640				76,652
Adjusted operating margin as a percent of net sales			6.8	%			5.7	%

Reconciliation of Segment Operating Income to Adjusted Segment Operating Income

(Amounts in thousands)

		Three Months Ended
Mohawk segment		December 31, 2010				December 31, 2009
Operating income		$	48,804				16,269
Adjustments to operating income
Business restructurings			—				20,189
Adjusted operating income		$	48,804				36,458
Adjusted operating margin as a percent of segment net sales			7.3	%			4.9	%
Dal-Tile segment
Operating income		$	19,902				11,528
Adjustments to operating income
Add: Business restructurings			—				9,598
Adjusted operating income		$	19,902				21,126
Adjusted operating margin as a percent of segment net sales			6.3	%			6.4	%

Reconciliation of Total Debt to Net Debt

(Amounts in thousands)

		Three Months Ended
		December 31, 2010
Current portion of long-term debt		$	350,588
Long-term debt, less current portion			1,302,994
Less: Cash and cash equivalents			382,171
Net Debt		$	1,271,411

Reconciliation of Total Debt and Equity to Total Capitalization

(Amounts in thousands)

		Three Months Ended
		December 31, 2010
Current portion of long-term debt		$	350,588
Long-term debt, less current portion			1,302,994
Total equity			3,271,556
Total Capitalization		$	4,925,138
Net Debt to Capitalization			26	%

Reconciliation of Operating Income to Adjusted EBITDA

(Amounts in thousands)

																		Trailing Twelve
		Three Months Ended																Months Ended
		April 3, 2010				July 3, 2010				October 2, 2010				December 31, 2010				December 31, 2010
Operating income		$	53,621				89,726				85,182				85,640				314,169
Other income (expense)			3,799				(1,428	)			3,471				1,324				7,166
Depreciation and amortization			76,798				72,497				72,956				74,522				296,773
Business restructurings			4,004				4,929				3,330				—				12,263
Adjusted EBITDA		$	138,222				165,724				164,939				161,486				630,371
Net Debt to Adjusted EBITDA																			2.0

The Company believes it is useful for itself and investors to review, as applicable, both GAAP and the above non-GAAP measures in order to assess the performance of the Company’s business for planning and forecasting in subsequent periods.