These are not your mother’s laundry machines. The latest trends seen in the national chains as well as the local specialty shops bring colors and function that have put a modern spin—and rinse—on laundry appliance retailing.
Analysis: In the past three years, the hardware and home center channel has grown ever-so slightly as other channels have essentially held steady. Ten years ago, you wouldn’t see major appliances in home centers, said Mark Delaney, NPD Group’s director of home improvement. “It’s quite remarkable that they’ve actually gained almost a third of the market.” The breakdowns by age and sex shown here are very similar to the other channels—predominately female, spread evenly across the age groups.
Analysis: Front loaders are gaining share at a clip of about 5 percentage points a year—despite the higher price point average of $671, which is $255 higher than traditional top loaders. The “other” category represents nontraditional colors, growing for both washers and dryers. Often accompanied by trendy designs, these machines carry higher prices. Still, the total average price year over year for washers declined 4.5 percent to $531.
Analysis: Consumers seem to be looking for better deals in 2008. “On sale” as a reason for purchase increased from 8.9 percent to 11.7 percent, and “Price” increased from 15.2 percent to 17.4 percent. Also, NPD began tracking “environmentally friendly/green” in 2008, a category chosen by 5.6 percent of respondents.
Methodolgy: NPD data is based on monthly tracking of nearly 70 categories and 30,000 opt-in consumers. The 2008 data above reflects the 12 months ended December 2008.
Armstrong swings to Q4 loss
Armstrong World Industries, a global manufacturer of flooring, cabinets, ceiling panels and other building products, has reported sales of $708.4 million for its fourth fiscal quarter, a 17 percent reduction from sales of $852.4 million in the same period of 2007. Excluding a $27.5 million, or 3 percent, impact from foreign exchange rates, sales decreased 14 percent.
Net loss for the quarter, which ended on Dec. 31, 2008, was $25.5 million. This compares to earnings of $19.6 million in the fourth quarter of 2007.
For the full fiscal year, Armstrong posted sales of $3.39 billion, compared to $3.55 billion in fiscal 2007. Excluding a $57 million favorable impact from exchange rates, net sales increased by 6 percent. Reported income for fiscal 2008 was $81 million, compared to $145.3 million in 2007.
In fourth-quarter results for its individual business segments, Armstrong reported $246.6 million in sales for resilient flooring, an 11 percent decline. Wood flooring recorded net sales of $124.5 million, a decrease of 34 percent. Last quarterOs results for the cabinets unit dropped 27 percent, to $38.6 million. Building products, a division that includes ceiling tiles and suspension systems, posted sales of $298.7 million, a 3 percent dip.
In its outlook, the Lancaster, Pa.-based company predicted difficult conditions in all its markets due to expected declines in European and North American commercial, residential floor and new housing markets. Armstrong has reduced its global work force 10 percent from year-end 2006 and said it anticipates additional headcount reductions of 5 percent to 10 percent in 2009.
Armstrong World Industries operates 40 manufacturing plants in 10 countries with approximately 12,200 employees worldwide.
NAHB objects to interest deduction proposal
A tax proposal from President Barack Obama to cap the mortgage interest deduction for certain households met swift criticism from the National Association of Home Builders (NAHB).
“With the housing market still reeling from its worst downturn since the Great Depression, this is not the time to talk about raising taxes on home buyers and homeowners,” said Joe Robson, chairman of the NAHB.
Obama’s proposal would cap the value of deductions for things like charitable donations, mortgage interest and investment expenses for couples making more than $250,000. The change would raise an estimated $180 billion over 10 years. The higher tax rates would pay for an expanded health care initiative.
“This proposal will increase the cost of housing for many middle-class families, particularly in high-cost areas such as California and the Northeast, which will only further undercut the housing market, exert more downward pressure on home values and work against the President’s efforts to stabilize housing and turn this economy around,” said Robson.
“The proposed budget would also tax a ‘carried interest’ as ordinary income, which could significantly impact the multi-family and commercial real estate sectors at a time when they are already experiencing a severe downswing,” Robson continued. “At this critical point in the recession, we should be doing everything we can to stimulate demand in housing and avoid proposals that would reduce housing affordability and further destabilize prices.”