AFI - Earnings call transcript Q1 2018 | Armstrong Flooring, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings and welcome to the Armstrong Flooring's First Quarter 2018 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Doug Bingham.

Doug Bingham

us call. Armstrong joining XXXX first for conference earnings you today Flooring’s for quarter Thank is by call Financial Today’s hosted Officer, and Don Ron Chief Maier; Ford. Chief Executive Officer, morning. have press seen We trust release you this our

statements call be Additionally, a copy refer involve website may on that the that and slide you our this making to Investors of we www.armstrongflooring.com. of during is that those advise uncertainties. accompany section presentation and presentation the at Actual available materially to differ of forward-looking expected this will I Slide implied. call, or risks X you outcomes from

a affect of Armstrong For filings. the may review please uncertainties our SEC that discussion detailed Flooring, risks more and

undertake what Forward-looking forward-looking update only statements the required is date speak of obligation we statements no any as beyond and applicable they securities by law. to made are

operating comparable non-GAAP presentation. A Regulation our will and directly most these addition, measures In Appendix of in included in SEC reconciliation performance of of the the this G. press of the within GAAP is discussion release measures the meaning to include financial measures

accordance have in income call available our changes to Finally, our in adjusted postretirement the over pension the be our historical XX-Q on and With Don. can Further found restated EBITDA. details operating will website. turn GAAP, now under and on costs represented is I and full with we how reconciliation that,

Don Maier

our for we first financial cover before participating the Thank to then remarks, business you, XXXX and our on Ron and you our call. morning, comments. offer details answer closing our on will open activity. thank Good additional discuss Today, highlights questions. After I outlook operating prepared Doug. and everyone, will call earnings your quarter results I will

ensuring successful customers hard I proceed, faith, the professionals This Armstrong our all want around underpinnings is let focused globe, accomplishments team for our have are the team the their brand's and I that promise, significant on which to of the buyer results. entire work dedicated our Before Flooring of thank endures.

some updates. key to X, Turning highlights provide which and Page

The dollars prior XXXX. first million EBITDA to our $X.X progress the in to goal in XX% increased margin $XX.X adjusted by EBITDA marked million Adjusted year. against compared quarter improve to and

benefits improve realizing control competitive productivity position. a targeted and are cost number initiatives We of our from to

Additionally, to Tile, generate and investments or distributor growth in product relationships bringing network Vinyl plant LVT, our have innovation, Luxury Tile, and Vinyl business. both mix enhancements or benefits Composition VCT, attractive helped in double-digit

continued the net first due of XXXX slightly sales and some As of our categories. higher legacy end were expected, challenges lower levels to inventory overall in at quarter distributor

However, our strategic initiatives to are of the year. accelerate in net growth half second on track sales the

entire in actions cost We other prospects, the underway inflationary saving and price, pressure productivity industry. intensifying evident these growth are across measures on and we offset to confident have

are free performance through quarter balance in with improved Our our to our company to generate to our build With aligned business solid with in leveraged cash we working cash conservatively recent we expectations is first investing in to in avenues value committed generate our XXXX, line the liquidity flow all actively and and strong returns. are sheet, years. flow in

our to X. priorities Moving on strategic Page

higher-end continues In updates our product our introductions include have profit Alterna enhancements will to supply towards competitive its rapid are due In and combined I products wood Core transformative have revitalization efforts distributors, the We legacy delivering innovation, will industry, visuals. which you all our to debuted and position Plank superior LVT, prior with These capabilities. the priorities, medium-term in innovation, of we LVT and well calls the Today, gained resistance expanded have dent several most Prism market wallet on Elements, acceptance. and sharper with broadest by and These improve perform strategic geared driven marketplace compelling categories. one which progress. of on share help including portfolios in our growth. discussed drive our share on priorities Rigid and January, goals. our new of leadership, we

Beyond have with in our LVT, width SPC and we products an the that of range Core a are introducing, including we stunning pipeline next these products, of currently provides exciting which product Rigid Vantage technological generation points options new embossed domestic visuals and our registered LVT textures. sheet increased shipments plant. LVT, resilient possible successfully allowed from This to we an made existing produce us plant. third LVT At through in entry-level advancements price that of was at have

of of current this represents only actively our small plant. are we working still sales, a to our expand capability expanded LVT this out portion While offering

is including Additionally, advanced in focus all repurpose our into especially domestic This for our direct plans Rigid capability on line. which categories. result Resilient production our existing to all we facets LVT, of strategy product Core production to major and Wood capacity has of durability is design additional have been Innovations and our essential a woven in plant company. increasingly innovation, of

our We our have to in meaningful to the appreciation cost. this XX XX categories scratch maintenance Last with we announced launch business. week, our trade visuals, stronger is resistance to the response enhancement to sharper a key milestone as and for Diamond and market numerous lower expanded of enhanced stain Diamond our Technology in a as well product grow part of our efforts VCT Technology. VCT business, marks

and mass great industry, in category As a are that VCT within extensively is looks products overall important good, used reminder, Customers and prefer and durable, hard flooring facilities VCT the flooring is is educational merchants. a surface a value. large and

as than beats durability, traffic high Technology. products, it love cost maintenance are, maintenance the have comfort, that value-priced average, scratch concrete look, chosen told us this who and game-changing and have stained competing they might Customers with lower XX than cost XX% on the with stain-resistant polished our as product. pricing appearance has of VCT. flooring previously VCT a significantly lower well premium customer installation commercial areas, and More flooring Diamond nothing the For

option a addition, program In sustainable flooring customers. our our VCT recycling to provides

In of now five in residential rapid solid from innovative key and LVT which to product resilient sheet, collectively categories represent with expansion additional support ourselves our XX% share wood, strategy. option who to aligning distribution, positioned over our of With we technology gaining growth Diamond are now are an to of wallet commercial partners XX, this VCT, and best committed and the sales. is

efforts a good previously We distributor change including announced on are making our products. progress direct partnerships, marketing in our residential and for in our our shift merchandising

own their distributors in will of transition providing by full year. QX, expect the the We begin completed a with end merchandising

contributor better success. In segment, be on to in and We with manufacturing line our are realized excited network our our flooring us gives commercial is benefits national we in current an accounts, to our this consolidated productivity collective Wood important able the more recent operations leverage by which across focus and wood demand, to believe opportunity years. more customer will

our outsourcing addition, work taken we the portfolio, margin In well of products profile engineered continue the including licensing wood improving towards steps in as to as using a more have laminate. to we model similar

productivity products portfolio, sales categories, XXXX. plants markets. sourced our to capital, we our and products improve for are revitalizing compete to wood used our increased improving XX% speed In result, sourced roughly new market to as engineered driving our in at without our more have by legacy have utilization We and a actively effectively in capacity investing additional our

only discussed wood, of a and as including VCT our The we Mannington Overall, facilities to we resilient acquired is on generating which also structure In just and technology production go-to-market our not acquisition priorities assets. and most Diamond the the XX and of accretive support applied efforts have ramped to track most of but attractive our deliver selling integration have products strategic recently, is are in VCT, existing I in adjusted benefits in range line to sheet, categories, top VCT, growth on it fully confident EBITDA our medium-term. earlier. to is this ability We one XXXX. using up

these continue to the as an to customers. products our the we build lineup driving of over of I’ll our We upon now of expect details winning call performance. goal sales for Ron financial providing by to through objectives walk on competitive more our turn growth even executing

Ron Ford

Thank our a we was result you, promising pressures. to assets and VCT sales were partially acquisition growth on double-digit of strong due declines on growth sales the generated also those categories, In which we’re LVT, certain of Resilient, In X. financial working a Resilient Don of drove VCT of by call as morning with Page LVT, a growth in offset other the Mannington on impact I’ll market review sustained VCT to In offset to Don, up mix. number avenues of businesses. recent our X% June on volume XXXX. a positive mentioned, double-digit the in net begin and The in good our today. results legacy in

were at a our sales, a in licensing at margin of XXXX. occur sales inventories lower along solid attractive decline sales wood. model transition the generated In laminate year-end to migration throughout market $XX XXXX, the result higher Additionally, accretive a quarter. distributor primarily million X.X% engineered both portion net more of The prior to was to that year previously Wood, compared of for laminate down disclosed with challenges the and EBITDA will reported licensing category. This albeit

activities business. competition. on benefit driven at We actions efforts corporate and industry if been including progress wood, for closures. from the face working reinvested investments their continually with annualized largely in EBITDA our these and compared adjusted in Total overhead $XX In a the the of that our to with less our to reductions to assess completed we track we of in first $XX.X with to the end prior forward are trend quarter the gains, reimbursements, increase and for the cost to of increased major portion in in to savings million to the we’ve generate make minor you selling from have category. change are and in in merchandising expected. efforts February go-to-market to collaborate as We low of million. which merchandising, previously now were we this represents be The the million our drive the customer reverse to million may the lower announced actively reimbursements on efficiencies reduction prior the majority import customers reimbursement solid $X.X our made, can SG&A, prior sales announced of seek $XX we and regards by of with look productivity the pressures in plant customers investments million in The XXXX, than updating year XX% retail marketing the significant markets. In successful, engineered periodically quarter, returns reimbursements along is largely volume continue $X.X growth while

in indicated significant inflation our first we quarter wood our and was the in businesses. on As raw both last material call, resilient

expect we moved which increases in XXXX. as continue range a of experiencing costs, to raw materials announced are and costs, April availability products which We effective XXXX. response, price to announced transportation, on we’ve actions. increase X% price wood considerably lumber a In many our tightened. have includes for rising In price energy, We’ve higher throughout XXXX of operating commercial X% a effective X% This has we solid products. in our announced to legacy increase X% May Resilient,

to with savings, actions In other surcharge will the additional segments, inflationary of intensifying effective pricing offset energy cost and actions, pressures. these We in and impact anticipate X. gains pricing on combined freight these addition May both we’ve shipments help a productivity implemented

cash to liquidity and free on Slide Turning X. our flow

year $XX cash an a this quarter, outflow and inventory outflow timing free During were million. has experienced management working The $XX cash below primary spend. quarter. free the depreciation, million factors prior of enhanced improvement million CapEx capital run the was annual we of planned which to of compared in rate the first $XX

XXXX cash coming We build as anticipate flow recent over quarters. free be continue with line to inventory years in will we

acquisitions. of quarter, us debt. March to During the of leverage on repurchases to transformational net X initiatives in to of times, We quarter places with the $XX XXXX. of million bringing inception million below us the since our to a which strong gives conservatively additional net ended invest balance pursue ratio X.X our and This flexibility shares, long-term target ongoing the repurchase continued aggregate consisting $XX sheet, program we

in these Turning and to taken. product benefits in innovations, $XX the actions from call, X. our and partnerships increased Today, efficiencies our our that transformational our enhanced intensified Since investments with outlook and exceeded million reduction plant This closures, higher wood believe LVT we’ve cost distribution we expectation actions input $XX and in of reinforce additional inflation has discussed on price through last lumber. initial offset includes adjusted We of in impact EBITDA our a range costs XXXX. along to announced productivity can outlook, VCT, our to the cost especially from gains. million of mixed initiatives which Slide number deliver

for year of the low is This particularly XXXX Our EBITDA relevant as in earlier towards some the work segment plants. QX weighted tide mentioned the in half towards growth the second half second supply adjusted address defer single to outlook constraints lumber may assumes shipments unchanged full of the availability, sales at Wood the year. some which while digits, weighting I we the our

Beyond anticipate in on that, higher the strengthened will XXXX. innovation us to accelerate we of focus our distribution product growth that partnerships categories, second sales and half allow

high with investments to projects paybacks return. should sales, approximately XXXX range to be return the million. Maintenance of to for short a to of for $XX projects of of innovation with $XX continue expect expect spending we X.X% CapEx or capital productivity the We consisting where expenditures balance million budgeted in the be X% strong

expect our taxes. rate zero a still a to of of result cash federal tax We Moving NOLs. as

tax P&L, the established the allowances recording our on a tax fourth accounting XXXX, us of including from quarter. based in we On valuation current the prevent rules this benefit quarter position,

our significantly could recent in be we change but positive free worth that zero. be We cash with expect taxes Our anticipate that flow, to cash it’s year quarter-to-quarter, will of years. full effective tax XXXX rate year line another remembering

hand to enhancing back I end while to the our continue below leverage We preserving X Don that, times will expect projects other the and call invest ample to value internal now comments. for year With ratio liquidity closing to target X.X in initiatives. of to EBITDA,

Don Maier

Ron. Thanks,

overall of This cornerstone us profitable driving to continue Slide We in performance to legacy through forward. our products, are higher serve. each and our relationships improvement Turning moving business sales taking that focus categories. we we growth to are our positions priorities. we’re excited flooring appropriate distributor the to X, in to mix technological category will while strategic maintaining advancements, improve efficiencies allow believe steps Innovation, strengthened of trajectory operating competitive growth the our strong improve

achieving XX% by a As EBITDA XXXX such, to of remain range committed scenarios. a margin we growth under

as forward have brand to take a We our strong levers with we're this multiple drive We upon goal. to objectives we executing all market of and shareholder accomplish to on strategy clear questions. build now returns. look Operator, leadership to our ready

Operator

question. SunTrust from Keith [Operator of first Instructions] we'll question proceed conducting a Robinson your time, be Please question-and-answer Humphrey. this At session. line Our comes the Hughes from with

Keith Hughes

distributors Thank just that the I on the is had Is with that relationship a business? the customer regular reimbursements, change you. million. you're question more Or of now? $X.X your a function just course of right undergoing

Don Maier

the that just Hi, continually it a normal we as attention. -- to market in this hope of customers it activity. you're the bring of do large on customer while enough call we we it's ought to our business customers, this we out I Keith, or course any time-to-time, It this individual from question. was felt particular well. to your expect, And we amount comment with case, like But don't kinds. for do you while is would thanks specifically all

Keith Hughes

Okay.

This happens So is see not we're going this every correct? something to just periodically? quarter,

Don Maier

and periodically, predict somewhat happens difficult timing. It to the

Keith Hughes

much you're Okay. much out in LVT currently that sort like the Could update is how growing, you And of us called how terms LVT, are in else you is LVT growing you sourced? And industry of on give your really producing? of everyone an well. selling being

Don Maier

time. as activity of a move see Frankly, capabilities this to plant is is the addition have a sourced there I Stillwater Rigid about and at Keith, our of and XXX% plans lot manufactured point Yes, right X/X we our growth has domestically we well, with as those forward. growing easiest that third way products X/X the right repurposing now for Core in the and term LVT now. Rigid the to probably think, in and us that come fourth Obviously, in the sourced, are Core it's from

Keith Hughes

And would Core, the correct? that fourth be plant current with plans Rigid is under

Don Maier

last Yes. what discussed we That's quarter.

Keith Hughes

kind when that Okay. would in? on of And any come timing

Don Maier

not on that. giving any No. We're firm timing

in the is timelines to However, of hope our we of done Stillwater same project. something have kind it that

much timing And more next be hopefully, you some be there. we'll to able quarter. done to firm So we, give work more

Keith Hughes

one core final you then? seen be the the Have -- flexible material? then degradation to is on Pricing And pricing or in pricing Okay. LVT. is how solid

Don Maier

Yes, little I in a I product areas would and of say say the -- the brokers are dynamic unchanged opening there's what Clearly, number has we're larger past. from the on in remained there there seeing the we've point more with discussed product, pressure. other would where folks out differentiation price

part have the innovations of products that moving also see the but products really we serve, offering into evolving categories focus to coating, to while and and XX really, the like on only in as that Diamond migrating differentiated strategy, category not we into SPC Our is the the direction.

Keith Hughes

do you called be again, don't segment for growers Or the it that basis? you've resilient tip a -- estimate? know And those out going Okay. two products any here you as of percentage bigger, but of of majority we do big to see like your products, by are break are out LVT on revenue, more and the any get to kind have consistent the you. VCT kind I growing, the feel kind you to scales of

Don Maier

Yes.

able the with been LVT, enjoying need So we we've to VCT to exciting nice about quarter. talk this category have talked It's and an we discussed. awful be line in get growth growth as another lot about top have to

getting the of a indicated, the in to some VCT make a as Having as associated much about of I Diamond VCT alternatives down stain of to very indicated, that on avenue overall the now look, and such change go XX forward a benefits Ron more believe, As of the lot Technology concrete. assets. meaningful provides it acquisition a a desirable said on cost ownership I that, Mannington's was large part with and excited of as rather to, this versus we're

Keith Hughes

Yes. Thank you.

Don Maier

Keith. you, Thank

Operator

Our Please from the with line next question. Nomura Instinet. of comes Michael proceed your question from Wood

Michael Wood

morning. my for Thanks taking good Hi, question.

customer that you now, just in into for was you reimbursements. million embedded just Can put much First, follow-up annual this on this And your year? another those guidance was how your unusual $X.X guidance? do clarify already typically

Ron Ford

included level we anticipated it consider it and the while timing, Yes, reimbursement of We and was. in not some known in have did, precisely our fact, may we guidance. it

Michael Wood

then that out was you that last worse so were to offset since savings you little was anticipation that inflation guidance? other a curious, you I'm called that maintain the to And call. your being I'm was or what that you to cost quarter's said, Is price success there of an generate? Great. the than anticipated curious it cost enabled able

Don Maier

Yes.

we guidance building we seeing are we blocks quarter, as What we fairly out consideration been indicated that our played for So had levels a And included that up the such, has is basically fact here indicated last Ron announced, accelerating had inflation. additional significant in well I'll But last as fact, costs. offset as a announced come actions those productivity the took there. efforts a in which, with we pricing to have as week.

of combination expect a levers you of normal the all So would

Michael Wood

on regard plant could LVT? at Great. to where you where Are margins to with also has you your optimization point enabled you productivity surpass is update a And yet LVT? the sourced with us your

Don Maier

and to with ago. a made all we it years sourced us you're number we financial of to we and functional cost products. Lancaster investment opened that than facility has provide think when referring lower fully of that that And envision had a operating the I benefits yes, So the is

Michael Wood

your distribution make Thank one Great. doing your can finally, progress to initiative? far? update so to or curious you're going could mid safeguarding has just you're brand? that that just on how if you that's I ask base. been how I'm give protecting with sure What an your And And just on marketing if you. shift on

Don Maier

until having And items say QX in that Yes, with had a full as would of this place on includes I turnover year. of up the track really year the this are responsibilities ramping not so number we of of planned. taking these end we

and place. transition this takes managing maintaining of all we So are those activities still while

So very as there working and way, the current there is at well. who this are We've they I seeking very no as risks – advantage our been think, marketplace distributors gives it by excited, is really been the that in a the closely them, that is something time. competitive with

marketplace that we would so criteria, get the to the of expect Performance particular natural make that the are And have consistent is you those the things regions. all misaligned rigorous – progress a to should good investments we expect there. sure should standards that all forward, manage brand sure in including remedies the and that being you would to this And across moving made branding make in case.

it. So we about feel very good

it, I the them, continue and we the think turned to our good of distributors feel work looking have them year. over collaboratively to very with keys end to about at the

Michael Wood

you. Thank Great.

Don Maier

guess on And you, we're Thank I bring there. business focus is the piece one we Mike. our as distributors our by other national can here and our is. that's as I there well to value which the increasing where increasing important time, same investments specifications the retailers, and focus real our At as think well commercial

Operator

your next question Scott Zelman the from proceed & with comes Please Our line Rednor question. Associates. of from

Scott Rednor

morning. good Hi,

Don Maier

Good morning, Scott.

Scott Rednor

noted and down you is issues for volume XQ, to, year-over-year of on guided you X% that about the some Q Within the Don.

guidance, growth digit assumption expectation low-single the in the for Don? Within volume, what’s

Don Maier

of Yes, product second initiatives will all other number activities the quarter, we part mix largely impact of of last so that the volume. of half indicated be VCT up and with volume a a that, ramping that's like a

you're we exited we half. So was bigger quarter, region, our in is inventory the levels solid – on large in there. a that the comparison. disruption In there a And will XXXX little were second higher be indicated, and as business, a we volume much quarter-on-quarter was a looking distributor the weather of a there Northeast the had Wood business if as at considerable factor part bit impact

the solid quarter Wood the in factor impacted certainly So overall there. business total, but not a in probably the

Scott Rednor

growth are or in between you talk That's or LVT, right materially WPC are guys, rates evident that SPC business? old the helpful. product when different about seeing Rigid is flexible, Or And your you versus the Great. you, now?

Don Maier

the growth our meaningful. rigid products Yes, Absolutely. in is

Scott Rednor

And just engineered the high-end even think about solid Don, when lastly, wood. wood then maybe you or

what fast, there consumer that is growing LVT guys' still curious is the consumer of so Just higher research seeing but kind still your value, – is kind product? recognizing customer of consumer just end want -- does

Don Maier

we indicate have there and good is that, LVT Yes, is, pieces number the out would that, very confirmed I a by much independent work that there's Having well. said in now same. of it rapid being of as increase dampened your the position think, that

we think growth I So LVT. would the much market of for [indiscernible] see impact rates higher

Scott Rednor

much. Okay, thank you very

Don Maier

Thank you.

Operator

Lacayo next comes Alvaro the proceed Please question. with from & of Our from Company. Gabelli your question line

Alvaro Lacayo

Good guys. morning

Don Maier

Hi, Alvaro.

Alvaro Lacayo

just mix LVT wanted VCT. in with growth want to make everything both Resilient mostly on rates question higher overall capture the mix. off side. just that’s just sure and it's So driving the start to the that improved I the And

business sure just to flattish then about segment. correct. And price that growth, the And little maybe a in you the of not Just could acquisition. kind this make described organic VCT, want kind talk with you of of is bit volume as on a past, including

be of the if And what those in said with rest past? been expectations year? the line the wondering in for would Just the trends what's are

Don Maier

residential sheet. the yes, the category all, the and products, of first largely So in by VCT in double-digit was LVT, gains driven by legacy offset Resilient

to I It's declines. past first not correct. single-digit changed. in much has X% your say, your years. of low still would The pretty part question, We've that's talked numerous market the for answer to about So VCT, X%

our that by as owner the partners the now that as the but excitement an view cost in there a much assets, So I around in And a the the really have stained it improvement curve and forward-looking a think improvement of the versus we Diamond is on the process we've acquisition be and changes clearly mix like distributor and the is market seen more category the our alternatives within technology having for double-digit in largely as well. as well growth well able hopefully trend, the the the benefits much great going Kind change nice product that to Mannington VCT area of on. – is driven as us, focused that XX that would because concrete. that's that have to overall realize, competitive team

Alvaro Lacayo

model. got to kind know said know then if on then of a to the on, not, Got the a terms just, for of it's business? maybe opportunity could migrated And with lower-end just, I of does laminate but laminate, product think could don't the that the business, that know little I've be the this than wood do I it's maybe a the the licensing in engineered And how you, I then okay. just get size wondering that add if past strengthen you bit progressing. engineered able or if licensing but you larger that early wood. but you in successfully belief much how that's could And that you you'll

Don Maier

Yes.

we just first all, working is as licensing the So of had out the on laminate, anticipated.

as any the some we into was into to look this an engineered expand here We have problems, run issues not important learning gain category. part to was wood which or

are concerns things there. for but although, still albeit progressing no early, reasons So relatively

to the On wood have today. side, engineered we don't disclose anything

However, I process when of going appropriate. really endeavor to meaningful to can of the negotiating in and say we've something arrangement. is have made progress that can a be size of hopefully that The function that announce

being the now So are be meaningful quantify still for it to as hard finalized. right you but more details will

Alvaro Lacayo

other effects out the -- just then on inventory with all thing the that just the on impact had seen an side, we And that have of build And it. been QX, wood got Okay, cleared the have inventory the I you out? called QX? with in an wooden be and availability the quantify material impact kind how will to was saw how similar what the sort of limited, quarter? to it we -- regards impact will Or I you QX impact that would what think mean, of second

Don Maier

Sure.

So, the piece all, through. has first worked of inventory

Northeast was the we wood impacted the in on on issues weather of for that forest. also to So the the same quarter. The referred out get logs the result callout ability availability, side the a that selling to

now fairly to so that is And right we're inventory now. is conducive tight log climate logging. Obviously, entering more

call So worked through. being time, to we impact. We we it's in see issue material as it going to a believe, out at have wanted that this don't point

we to return, that for don't quarter a it's availability if, want risk tail some the out However, end. levels could reason, the potential lumber did the towards impact call

Alvaro Lacayo

very you Thank much.

Don Maier

you. Thank

Operator

comes proceed Baugh from of the Stifel. Please Our question. your from next question line John with

John Baugh

has morning been good you, asked I left. Most Doug. and Don, Thank Ron things two but, guess,

solid two to business. trying or you maybe give three to You Could things that happen? wood on make you're turn mentioned working your us

Don Maier

you said more could you turn? little John, specific a when be

John Baugh

you mentioned inventory. there. of been two that be But might that three negative have I'm sure and were just try the or down. the you're solid hard mentioned what turn Well, curious you trend to that working Texas initiatives I'm volumes some to the might

Don Maier

Yes.

impacts as which, to personally the is then quarter, storms ability, in get the as houses. had So sales as exited have interesting inventory know, XXXX. in levels market a folks of discussed, we we to you Northeast, their and solid for few the primary higher impacted of were even two the out so solid, And quite the on that

XX other initiatives the with two the number In only are us. behind beginning a And encouraging. we introduced technology a we of traction have also Diamond play. product that's but for play well that margin we've as the is The get that as on side. So not that's what launched and you last new know, particular to are a volume collections products us quarter

solid we see and I to, for business. both opportunities So continue volume within mix nice the improvements think,

John Baugh

products price update Am on And April – Okay. the And success relatively mistaken was then Any good on kind on you is that? May think have and believe you’ve on cannot the commercial the in do to just going increase I Resilient, past, that I go? solid how increase of that? there.

Don Maier

far, make Yes, so inflationary on share sure competitively that at distributors. our and not have I of to been we the obviously, guess, not then time, comment span there seeing the be and we're that would tag that say, close our us to industry. unique fine. entire Armstrong, price Ron, pressures are would is to you we're impacts. we've same then I so seeing these front But in -- to the they out getting And if I'll want very And anything

far, we're closely would our able that some the thus to working increases you too to but add? of get like distributors offset mix that right make inflation of going comment, we feel a that price be seeing. probably Ron, that realizing to way we're early to with and the So to achieving

Ron Ford

them freight, example. This country that. it's in I a now, industry-wide business-wide the would challenge echo an for among challenge, fact, in right is

them hearing earnings listen not unique to. you on in every that We're regard. You're call

is fully a is the way, it of market of are no necessary. stay part, customers is merely aware this the to costs a as so trying that this, matter these in And our sort mentioned, of fact that grab fully and Don our aware is And competitive. on recover margin also,

us achieve our to and is are to price right our realization. the for high reasonably So confidence ability conditions to --

John Baugh

is this question on I there some the about with back? Is do so, simple but last my if larger change of are excited smaller then guess, made, guess them. deal that my And doing are distributors take I [indiscernible] sounds some like that. to pushing And distributors context there, that? little you might processes on ones And and how few a for the distributor were Thanks it you be for question the minuses plus. But pluses some of any the there is might we've struggle change. the who are

Don Maier

Yes.

pushing distributors back. no So are

in my I the transition. couple of comments, them all capabilities lot say to a ready that through of would the for we good. fully with quarters speak. a working here we the are our we have distributor get very ourselves As indicated And of as I are details

excellent. are them of Some

so And are working we excellent to to get standpoint. that everybody capability

John Baugh

Thanks Great. my and answer good for luck. questions

Don Maier

Thanks, John.

Operator

Ladies and call question-and-answer of end the to Don session. turn have for I like reached back would to Maier gentlemen, remarks. the closing we And the

Don Maier

and forward you, we Thank a today. on Have you look to updating interest Armstrong day. Flooring, We you And great joining appreciate thank operator. everyone us calls. future in for your

Operator

today's concludes This conference.

time. lines Thank you disconnect your your may participation. this You at for

Armstrong Flooring (AFIIQ) 8 May 182018 Q1 Earnings call transcript