Armstrong sales rise in 3Q amid tariffs

Armstrong Flooring Inc. saw an increase in sales and profits for its third quarter even as it begins to feel pressure from U.S. tariffs on goods from China.

The Manor Township-based flooring manufacturer reported sales of $309.7 million in the third quarter of 2018, up $1.2 million from the same period last year, according to filings with the U.S. Securities and Exchange Commission.

Its profits rose to $7.9 million for the third quarter, up from a loss of $18.7 million for the third quarter of 2017 stemming from plant-closure costs and other expenses. The improvement comes on the tail end of a more profitable first half of 2018 for the company.

The results, however, were mixed by product line. Armstrong saw sales grow for its vinyl tile products but a decline in its wood flooring products.

Armstrong’s sales of vinyl flooring increased to $208.1 million in the third quarter, up from $194.4 million in the same period in 2017. Net sales for wood flooring dropped from $114.1 million to $101.6 million.

Stephen Trapnell, communications manager for Armstrong, said the wood flooring market has become increasingly competitive over the years as lumber costs and tariff increases bring up the price of product.

Armstrong also increased its prices in response to a 10 percent U.S. tariff enacted in late September on certain flooring products from China. The tariff is expected to increase to 25 percent on Jan. 1.

Armstrong makes 75 percent of its products in the United States but imports a portion of its luxury vinyl tile and engineered wood flooring from China. Trapnell emphasized that the tariff will give Armstrong an even greater reason to market its U.S.-made products, manufactured in 12 factories across the country.

“We are trying to make people aware that we have products here in the U.S. that are not subject to those tariffs,” he said. “As the pricing of imports from China increases, it makes our U.S. flooring more competitive.”

It’s not just tariffs, however, that are affecting product prices. Armstrong faces rising costs in getting products to customers.

“Not only our company but across the industry there’s a lot of inflation overall. Particularly transport and shipping prices have increased significantly,” Trapnell said.

Ioannis Pashakis
Ioannis Pashakis covers health care and Lancaster County. Email him at ipashakis@cpbj.com.

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