LANCASTER, PA - Armstrong World Industries Inc. (NYSE: AWI), a designer and manufacturer of floors, ceilings, and cabinets reported a second quarter profit of $41.9 million on lower net sales of $709.9 million for the second quarter.
Compared to Q2 2011, Armstrong's net income rose 10.3% as its net revenues declined by 5.8%
Looking to the second half of the year, Armstrong said an expected slowing economy in the United States and even more so in Europe will make it difficult for it to hit its revenue target of $2.9 billion to $3 billion. As a result, the company announced it was reducing its 2012 revenue guidance to $2.75 billion to $2.85 billion.
To help compensate for this predicted revenue shortfall. Armstrong said it would enact further cost-cutting measures.
"In spite of a soft sales environment in the second quarter, we were able to deliver adjusted EBITDA of $110 million, an improvement of 1% over the prior year and within our guidance range," said Matt Espe, CEO. "We continue to see volumes down across our businesses as global markets continue to struggle, with Europe in particular, experiencing sharp volume declines in the second quarter. We will continue to responsibly manage our cost structure and adapt to the continued challenging market conditions. As a result we are increasing our cost savings target by another $15 million, bringing the total program goal to $200 million."
Armstrong's wood flooring division experienced a 3% profit even as Q2 sales decreased by 6.6% to $124.8 million. The cabinet side experienced a $700,000 loss as Q2 sales declined from 2% to $34.8 million.
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