Interface, Inc. Plunged On Q3 Warning; Expands Restructuring Plan

Interface, Inc. TILE warned that third-quarter results will fall well below expectations because of fewer orders and deferred deliveries.

Interface fell more than 23 percent in Tuesday's after-hours session to $12.18 per share.

The Atlanta-based maker carpet tiles also expanded the scope of charges for a restructuring plan to $12.5 million, from the $3 million to $5 million announced July 28.

The restructuring is now to include $9.5 million for severance and $3 million to write down the value of impaired assets. The plan is to completed by the end of 2014, and is expected to yield annual savings of $14 million starting in 2015.

"Unfortunately, our preliminary results in the third quarter have not shaped up to our expectations," Chief Executive Daniel T. Hendrix said, citing customer deferrals of order delivery dates, disruptions in yarn supply and lower order intake levels at the beginning of the quarter.

Interface also said it will use cash on hand to buy back 500,000 of its shares per fiscal year, commencing with the 2014 fiscal year.

The company expects third-quarter results between a net loss of $0.7 million and net income of $0.3 million, or a loss of $0.01 and earnings of $0.01 per share. Adjusted earnings will be between $0.12 and $0.14 per share.

It expects revenue of $250 million to $255 million, compared with $255 million in the third quarter last year.

Analysts on average expect third-quarter earnings of $0.25 per share, on revenue of $275.2 million.