Shaw sees tough second quarter

Published 7:01 pm Friday, August 7, 2009

The “ongoing recession” and “slow” residential real estate market continued to batter Dalton-based Shaw Industries during the second quarter of this year.

From April to June, Shaw’s pre-tax earnings were $30 million, a decrease of $52 million (63 percent) compared to the same period last year. Earnings were $85 million for the first six months of 2009, a decrease of $48 million (36 percent) compared with 2008.

Shaw’s revenues in the second quarter and the first six months of 2009 declined $308 million (23 percent) and $529 million (21 percent) from revenues in the same periods in 2008. The revenue drop was due to lower unit sales. So far in 2009, Shaw has incurred costs of $43 million in the second quarter and $54 million in the first six months related to plant closures.

“Operating results in 2009 benefited from lower raw material costs,” according to the second quarter results released by Shaw’s parent company, Berkshire Hathaway. “However, the favorable impact of the lower material costs was more than offset by relatively higher operating costs attributable to significant declines in sales volume, which decreased plant operating levels and manufacturing efficiencies, and costs related to plant closures.”