Armstrong World Industries(US:AWI)2021-10-25 16:00Sales Performance - Total consolidated net sales for Q3 2021 increased by 18.6% to $292.2 million compared to $246.3 million in Q3 2020[168]. - For the first nine months of 2021, total consolidated net sales rose by 18.0% to $824.1 million from $698.2 million in the same period of 2020[168]. - The increase in Q3 2021 net sales was driven by a $27 million increase in Mineral Fiber segment net sales and a $19 million increase in Architectural Specialties segment net sales compared to Q3 2020[168]. - The 2020 acquisitions contributed $24 million and $58 million to revenue growth for Q3 and the first nine months of 2021, respectively[159]. - Average unit value (AUV) improvements added approximately $26 million and $48 million to consolidated net sales for Q3 and the first nine months of 2021, respectively[160]. - Total segment net sales for Mineral Fiber in Q3 2021 were $214.5 million, a 14.5% increase from $187.3 million in Q3 2020; for the first nine months, net sales rose to $611.3 million from $542.9 million (12.6% increase)[181]. - Architectural Specialties segment net sales in Q3 2021 were $77.7 million, a 31.7% increase from $59.0 million in Q3 2020; for the first nine months, net sales rose to $212.8 million from $155.3 million (37.0% increase)[184]. Operating Income and Expenses - Higher costs for raw materials and energy negatively impacted operating income by $5 million and $8 million for Q3 and the first nine months of 2021, respectively[164]. - Cost of goods sold in Q3 2021 was 62.1% of net sales, down from 63.0% in Q3 2020, and for the first nine months, it decreased from 64.2% to 63.2%[170]. - SG&A expenses in Q3 2021 were $62.3 million (21.3% of net sales), up from $41.0 million (16.6% of net sales) in Q3 2020; for the first nine months, SG&A expenses rose to $176.5 million (21.4% of net sales) from $108.8 million (15.6% of net sales)[171]. - Unallocated Corporate operating loss was $1 million in Q3 2021, compared to income of $5 million in Q3 2020; for the first nine months, the loss was $4 million compared to income of $16 million in the prior year[187]. Cash Flow and Financing - Operating activities provided $137.9 million of cash in the first nine months of 2021, down from $148.4 million in the same period of 2020[188]. - Net cash used for investing activities was $5.4 million in the first nine months of 2021, significantly lower than $52.2 million in the same period of 2020[189]. - Net cash used for financing activities was $175.1 million in the first nine months of 2021, compared to $2.5 million in the same period of 2020, primarily due to higher debt payments and stock repurchases[190]. - As of September 30, 2021, the company had $94.3 million in cash and cash equivalents, with $80.4 million in the U.S. and $13.9 million in foreign jurisdictions[195]. - The total available under the revolving credit facility was $345.0 million as of September 30, 2021[195]. - The company has a total of $175.0 million in financing arrangements, with $8.4 million used and $166.6 million available[195]. - The company has entered into interest rate swaps totaling $400.0 million to hedge against changes in LIBOR[193]. - The interest rate swaps are designated as cash flow hedges against a portion of the company's variable rate debt[194]. - The company has a bi-lateral facility with a limit of $25.0 million, of which $8.4 million is currently used[195]. - The company has a revolving credit facility with a limit of $150.0 million, which is fully available[195]. COVID-19 Impact - The company did not record any asset impairments or material bad debt reserves related to COVID-19 during the first nine months of 2021[145]. - The company continues to monitor the impact of COVID-19 on its operations, particularly regarding supply chain and labor disruptions[143]. - The company is evaluating discretionary spending and capital expenditures due to the uncertainty related to the COVID-19 pandemic[195]. - The company believes that cash on hand and cash generated from operations will be adequate to address near-term liquidity needs[195]. - The impacts of COVID-19 could create volatility in financial markets, potentially affecting capital access[195]. Employment and Operations - As of September 30, 2021, the company operated 16 manufacturing plants, with 14 in the U.S. and 2 in Canada[151]. - The company had approximately 2,800 full-time and part-time employees as of September 30, 2021, up from 2,700 at the end of 2020[166]. Equity Earnings - Equity earnings from the WAVE joint venture increased to $23.4 million in Q3 2021 from $15.2 million in Q3 2020, and for the first nine months, they rose to $68.1 million from $48.2 million[175]. Segment Performance - Operating income for Mineral Fiber in Q3 2021 was $68.5 million, up 17.9% from $58.1 million in Q3 2020; for the first nine months, it increased to $201.2 million from $173.7 million (15.8% increase)[182].