CHARLESTON, W.Va. - Armstrong World Industries Inc.'s second-quarter net income fell 28 percent as it dealt with higher lumber costs and increased costs related to hiring.
The Lancaster, Pa.-based floor and ceiling manufacturer cut its 2013 adjusted earnings forecast again because of softer commercial construction in Europe and manufacturing and other challenges. It provided a third-quarter revenue outlook above Wall Street's view.
Armstrong earned $29.9 million, or 50 cents per share, for the three months ended June 30. That's down from $41.8 million, or 70 cents per share, in the 2012 second quarter.
The company said Monday that it faced higher manufacturing and input costs during the quarter because of rising lumber costs. It also had higher labor costs related to adding workers at several solid wood plants to keep up with increased demand.
Armstrong has two plants in West Virginia: a hardwood flooring plant in Beverly and a mineral wool fiber plant in Millwood. In December, the company began hiring an additional 145 workers at its Beverly site.
The company expects cost pressures to continue in the coming quarters.
"We continue to face manufacturing and lumber inflation headwinds in the wood business and now expect a lower commercial market opportunity in Europe for the remainder of the year," chief financial officer Tom Mangas said. "As a result, we are lowering our full year earnings guidance."
Armstrong now expects 2013 adjusted earnings in a range of $2 to $2.30 per share. In April the company lowered its guidance to $2.15 to $2.45 per share for the year, down from its earlier prediction of $2.30 to $2.60 per share.
It still foresees revenue between $2.7 billion and $2.8 billion. The company expects third-quarter revenue of $740 million to $780 million.