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): July 21, 2008

MOHAWK INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)

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

160 South Industrial Blvd., Calhoun, Georgia	 	30701	
(Address of Principal Executive Offices)	 	(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):
 
¨	Written communication pursuant to Rule 425 under Securities Act (17 CFR 230.425)	
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act CFR 240.14d-2(b))	
¨	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 July 21, 2008, Mohawk Industries, Inc., issued a press release announcing its second quarter financial results. A copy of the press release is attached hereto and hereby incorporated by reference as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1     Press release dated July 21, 2008.

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.

 	 	 	 	Mohawk Industries, Inc.	
 	 	 	 	
Date: July 21, 2008	 	 	 	By:	 	/s/ THOMAS J. KANUK        	
 	 	 	 	 	 	Thomas J. Kanuk	
 	 	 	 	 	 	V.P. & Corporate Controller	

INDEX TO EXHIBITS
Exhibit
99.1.     Press release dated July 21, 2008.

Exhibit 99.1

NEWS RELEASE                                                                                 	 	 	

 	 	 	
For Release:	  	Immediately	
 	 	
Contact:	  	Frank H. Boykin, Chief Financial Officer	
 
MOHAWK INDUSTRIES, INC. ANNOUNCES
SECOND QUARTER EARNINGS
Calhoun, Georgia, July 21, 2008—Mohawk Industries, Inc. (NYSE:MHK) today announced 2008 second quarter net earnings of $89 million and diluted earnings per share (EPS) of $1.29 (both 23% below last year). In the second quarter of 2007, net earnings and EPS were $115 million and $1.68 per share, respectively. Net sales for the quarter were $1,840 million, a decrease of 7% from 2007. The company generated cash flow from operations of $267 million. In addition, $183 million of debt was paid down improving the company’s debt to capital ratio to 30%.
For the first six months of 2008, net earnings were $154 million and EPS was $2.25 (both 25% below last year). Net earnings and EPS were $206 million and $3.01 per share, respectively, in the first six months of 2007. Net sales for the first six months of 2008 were $3,578 million representing a 7% decrease from 2007. The sales decreases for both the quarter and the year to date are attributable to slowing U.S. residential housing and European demand.
In commenting on the second quarter results, Jeffery S. Lorberbaum, Chairman and CEO stated, “Our results for the second quarter were impacted by the slowing economies in the U.S. and Europe and rapidly increasing commodity costs. Declining new U.S. home construction and residential remodeling, slowing European demand and rising raw material and energy costs have contributed to the flooring industry cyclical decline. The rapidly increasing costs are impacting our margins even as we raise selling prices to offset these costs.

Our management team remains focused on improving our market position, increasing quality, introducing innovative products and providing excellent customer service. The team is relentlessly pursuing cost control, working capital management, and process improvement to manage the cycle. We believe these efforts will better position our company for growth when the market improves.
The Mohawk segment performance is under pressure with sales declining 13% below last year. The commercial and rug products are performing better while the hard surface and the cushion products are declining more than residential carpet. Higher energy, raw material and freight costs are causing dramatic cost inflation. We have announced three carpet price increases since December to offset rising costs. We are increasing our commercial carpet tile offering with new value, performance and stylized options in our brands. We have re-engineered processes and improved manufacturing productivity, quality and yields.
Dal-Tile sales are down 5% during the quarter and are doing well in a very difficult environment. Commercial and Mexican sales growth continue to buffer the impact of the declining U.S. residential industry. In July, we purchased a stone center in North Carolina to continue expanding our national presence. The major factors affecting margins are rapidly rising energy and freight costs along with customers trading down. In the second quarter we have increased product prices and energy surcharges to offset rising costs and more may be required in the future. Many cost initiatives are being executed to improve labor productivity, control expenses and reduce energy consumption. Freight costs are being reduced by utilizing lower cost transportation modes, increasing weight per load and making more direct shipments.
Unilin sales were up 13% over last year and down 7% on a constant exchange rate basis excluding the Columbia acquisition. Sales declines were experienced in the U.S. and much of Western Europe, with Russia and Eastern Europe growing. Sales in the U.K. and Spain were most impacted by the slowing European industry. Oil based material and energy inflation continues to increase the cost of most products. A 5% - 6% price increase has been announced for the U.S. laminate business during the third quarter. The new laminate production in the U.S. will be operating in the third quarter and will reduce our costs on higher end products presently imported from Europe. We have many cost initiatives to reduce energy consumption, modify processes and lower material cost.

The wood operations continue to operate at a loss. New products are being launched in the third quarter to reposition both the Columbia and Mohawk brands in the market. We have made significant improvements in manufacturing processes, reducing labor, improving quality and material yields, but negative overhead absorption is offsetting the progress. We expect our new product strategy will improve our wood sales and product mix.”
The third quarter outlook is challenging given the environment. Slow demand with higher material and energy costs will continue to compress our margins. As a result, we are raising product prices and transportation fees on most products. We will adapt our strategy to the changing environment. Based on these factors our guidance for the third quarter of 2008 is $1.06 to $1.15. We have many focused initiatives under way to reduce cost, minimize working capital, improve service and bring new products to market. We remain convinced Mohawk will be a stronger company as we come out of this cycle.
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; litigation and other risks identified in Mohawk’s SEC reports and public announcements.
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, Ralph Lauren, 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 over 250 local distribution locations.
There will be a conference call Tuesday, July 22, 2008 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 # 54459485. A conference call replay will also be available until Monday, July 28, 2008 by
dialing 1-800-642-1687 for US/local calls and 1-706-645-9291 for International/Local calls and entering
Conference ID # 54459485.

MOHAWK INDUSTRIES, INC. AND SUBSIDIARIES

Consolidated Statement of Earnings Data	  	Three Months Ended	 	 	Six Months Ended	 	
(Amounts in thousands, except per share data)	  	June 28, 2008	 	 	June 30, 2007	 	 	June 28, 2008	 	 	June 30, 2007	 	
Net sales	  	$	1,840,045	 	 	1,977,210	 	 	 	3,578,142	 	 	3,841,073	 	
Cost of sales	  	 	1,357,153	 	 	1,420,512	 	 	 	2,635,411	 	 	2,760,935	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	  	 	482,892	 	 	556,698	 	 	 	942,731	 	 	1,080,138	 	
Selling, general and administrative expenses	  	 	336,829	 	 	358,450	 	 	 	672,350	 	 	711,313	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income	  	 	146,063	 	 	198,248	 	 	 	270,381	 	 	368,825	 	
Interest expense	  	 	32,742	 	 	39,138	 	 	 	66,509	 	 	80,717	 	
Other (income) expense, net	  	 	1,650	 	 	(2,783	)	 	 	4,429	 	 	1,476	 	
U.S. Customs refund	  	 	—  	 	 	—  	 	 	 	—  	 	 	(9,154	)	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings before income taxes	  	 	111,671	 	 	161,893	 	 	 	199,443	 	 	295,786	 	
Income taxes	  	 	22,893	 	 	46,625	 	 	 	45,275	 	 	90,140	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings	  	$	88,778	 	 	115,268	 	 	 	154,168	 	 	205,646	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings per share	  	$	1.30	 	 	1.69	 	 	 	2.25	 	 	3.02	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted-average shares outstanding	  	 	68,403	 	 	68,167	 	 	 	68,389	 	 	68,037	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share	  	$	1.29	 	 	1.68	 	 	 	2.25	 	 	3.01	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted-average common and dilutive potential common shares outstanding	  	 	68,617	 	 	68,533	 	 	 	68,598	 	 	68,394	 	

Other Financial Information	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
(Amounts in thousands)	  	 	 	 	 	 	 	 	 	 	 	 	
Net cash provided by operating activities	  	$	266,871	 	 	225,685	 	 	 	186,692	 	 	314,452	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Depreciation & amortization	  	$	75,052	 	 	75,382	 	 	 	148,308	 	 	149,228	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	  	$	49,839	 	 	35,428	 	 	 	105,810	 	 	60,384	 	

Consolidated Balance Sheet Data	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
(Amounts in thousands)	  	 	 	 	 	 	 	June 28, 2008	 	 	June 30, 2007	 	
 	 	 	 	 	
ASSETS	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current assets:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash & cash equivalents	  	 	 	 	 	 	 	 	$	64,038	 	 	57,763	 	
Receivables	  	 	 	 	 	 	 	 	 	982,378	 	 	998,023	 	
Inventories	  	 	 	 	 	 	 	 	 	1,250,300	 	 	1,229,326	 	
Prepaid expenses	  	 	 	 	 	 	 	 	 	131,218	 	 	121,625	 	
Deferred income taxes	  	 	 	 	 	 	 	 	 	138,332	 	 	173,252	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current assets	  	 	 	 	 	 	 	 	 	2,566,266	 	 	2,579,989	 	
Property, plant and equipment, net	  	 	 	 	 	 	 	 	 	2,018,813	 	 	1,858,282	 	
Goodwill	  	 	 	 	 	 	 	 	 	2,876,724	 	 	2,719,724	 	
Intangible assets	  	 	 	 	 	 	 	 	 	1,190,157	 	 	1,153,761	 	
Deferred income taxes and other assets	  	 	 	 	 	 	 	 	 	307,572	 	 	27,972	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	$	8,959,532	 	 	8,339,728	 	

LIABILITIES AND STOCKHOLDERS’ EQUITY	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current liabilities:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current portion of long-term debt	  	 	 	 	 	 	 	 	$	290,392	 	 	364,114	 	
Accounts payable and accrued expenses	  	 	 	 	 	 	 	 	 	965,743	 	 	1,061,157	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current liabilities	  	 	 	 	 	 	 	 	 	1,256,135	 	 	1,425,271	 	
Long-term debt, less current portion	  	 	 	 	 	 	 	 	 	1,896,642	 	 	2,137,349	 	
Deferred income taxes and other long-term liabilities	  	 	 	 	 	 	 	 	 	763,858	 	 	768,278	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities	  	 	 	 	 	 	 	 	 	3,916,635	 	 	4,330,898	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total stockholders’ equity	  	 	 	 	 	 	 	 	 	5,042,897	 	 	4,008,830	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	  	 	 	 	 	 	 	 	$	8,959,532	 	 	8,339,728	 	

Segment Information	  	As of or for the Three Months Ended	 	 	As of or for the Six Months Ended	 	
(Amounts in thousands)	  	June 28, 2008	 	 	June 30, 2007	 	 	June 28, 2008	 	 	June 30, 2007	 	
Net sales:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Mohawk	  	$	968,426	 	 	1,113,412	 	 	 	1,873,470	 	 	2,161,073	 	
Dal-Tile	  	 	481,511	 	 	505,187	 	 	 	930,562	 	 	972,148	 	
Unilin	  	 	411,525	 	 	363,531	 	 	 	815,280	 	 	715,627	 	
Corporate and eliminations	  	 	(21,417	)	 	(4,920	)	 	 	(41,170	)	 	(7,775	)	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Consolidated net sales	  	$	1,840,045	 	 	1,977,210	 	 	 	3,578,142	 	 	3,841,073	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Mohawk	  	$	34,593	 	 	59,730	 	 	 	56,834	 	 	108,175	 	
Dal-Tile	  	 	58,169	 	 	69,353	 	 	 	115,110	 	 	133,748	 	
Unilin	  	 	60,121	 	 	81,737	 	 	 	110,077	 	 	142,236	 	
Corporate and eliminations	  	 	(6,820	)	 	(12,572	)	 	 	(11,640	)	 	(15,334	)	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Consolidated operating income	  	$	146,063	 	 	198,248	 	 	 	270,381	 	 	368,825	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Assets:	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Mohawk	  	 	 	 	 	 	 	 	$	2,400,869	 	 	2,474,276	 	
Dal-Tile	  	 	 	 	 	 	 	 	 	2,259,255	 	 	2,297,745	 	
Unilin	  	 	 	 	 	 	 	 	 	4,109,314	 	 	3,337,870	 	
Corporate and eliminations	  	 	 	 	 	 	 	 	 	190,094	 	 	229,837	 	
 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Consolidated assets	  	 	 	 	 	 	 	 	$	8,959,532	 	 	8,339,728	 	

Reconciliation of Debt to Capital

(Amounts in thousands)	  	 	  	 	  	 	 	 	As of June 28, 2008	 	 	 	  	 	 	
Outstanding Debt (a)	  	 	  	 	  	 	 	 	$	2,187,034	 	 	 	  	 	 	
Total stockholders’ equity	  	 	  	 	  	 	 	 	 	5,042,897	 	 	 	  	 	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Total capital (b)	  	 	  	 	  	 	 	 	$	7,229,931	 	 	 	  	 	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Debt to capital percentage (a)/(b)	  	 	  	 	  	 	 	 	 	30	%	 	 	  	 	 	

Reconciliation of Operating Income to EBITDA	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
 	  	Three Months Ended	 	 	Trailing Four
Quarters Ended
June 28, 2008	 	
(Amounts in thousands)	  	September 29, 2007	  	December 31, 2007	  	March 29, 2008	 	 	June 28, 2008	 	 	 	 	
EBITDA reconciliation:	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Operating income	  	200,814	  	180,467	  	124,318	 	 	 	146,063	 	 	 	  	651,662	 	
Other (expense)/income	  	799	  	3	  	(2,779	)	 	 	(1,650	)	 	 	  	(3,627	)	
Depreciation and amortization	  	75,636	  	81,573	  	73,256	 	 	 	75,052	 	 	 	  	305,517	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	 	
EBITDA	  	277,249	  	262,043	  	194,795	 	 	 	219,465	 	 	(c )     953,552	 	

Reconciliation of Debt to EBITDA	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Debt to EBITDA (a)/(c)	  	 	  	 	  	 	 	 	 	2.3	 	 	 	  	 	 	

Reconciliation of Unilin Segment Net Sales to Adjusted Unilin Segment Net Sales	 	 	 	 	 	 	 	  	 	 	
(Amounts in thousands)	  	 	  	 	  	 	 	 	Three Months Ended
June 28, 2008	 	 	 	  	 	 	
Unilin segment net sales	  	 	  	 	  	 	 	 	$	411,525	 	 	 	  	 	 	
Less: Exchange rate gain	  	 	  	 	  	 	 	 	 	41,000	 	 	 	  	 	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Adjusted Unilin segment net sales	  	 	  	 	  	 	 	 	 	370,525	 	 	 	  	 	 	
Less: Wood acquisition net sales	  	 	  	 	  	 	 	 	 	33,863	 	 	 	  	 	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
Adjusted Unilin segment net sales	  	 	  	 	  	 	 	 	$	336,662	 	 	 	  	 	 	
 	  	 	  	 	  	 	 	 	 	 	 	 	 	  	 	 	
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.