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March 1, 2010

Economy still battering Shaw

From staff reports Dalton Daily Citizen

DALTON — Dalton-based Shaw Industries has shed 3,482 workers since the end of 2008, according to an annual report from its parent company, Berkshire Hathaway.

In 2008, the world’s largest tufted broadloom carpet manufacturer employed 28,974. Now, that number is 25,492.

A prolonged housing slump and the recession have had a profound effect on the company.

Revenues for Shaw Industries in 2009 dropped more than $1 billion (21 percent), from $5.05 billion in 2008 to $4.01 billion. The decrease was primarily due to an 18 percent reduction in carpet sales volume. Revenues were $5.37 billion in 2007. Earnings last year were $144 million, down from $205 million in 2008 and $436 million in 2007.

“Shaw’s sales volume and earnings during the last two years have been negatively impacted by the depressed residential housing market and the economic recession in the U.S.,” according to the report.

Every business Omaha, Neb.-based Berkshire Hathaway owns tied to residential and commercial construction “suffered severely” in 2009. Combined pre-tax earnings for the four companies was $227 million, an 82.5 percent decline from $1.29 billion in 2006 when construction activity was “booming.” The four companies are Acme Brick (face brick and concrete masonry products), Johns Manville (insulation and building products), MiTek (steel connector products and engineering software for the building components market) and Shaw Industries.

“These businesses continue to bump along the bottom, though their competitive positions remain undented,” according to the annual report.

Shaw Industries is still being affected by the housing slump. During the past three years, the company’s number of employees, revenues and earnings have declined.

Employees

2009: 25,492

2008: 28,974

2007: 30,874

Revenues

2009: $4.01 billion

2008: $5.05 billion

2007: $5.37 billion

Earnings

2009: $144 million

2008: $205 million

2007: $436 million

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