Floor Care Brings Maytag Down In Q2

NEWTON, IOWA— The No. 3 majap maker Maytag said it enjoyed strong sales of washers, dryers and dishwashers in the second quarter, but lower sales of floor care products put its overall home appliances segment in the red.

Margins on sales of majaps were depressed primarily as a result of the competitive pricing environment associated with a weaker industry, said Maytag.

An unexpected decline in industry volume of floor-care products during the second quarter ended June 30 — which reversed a trend in industry growth — combined with majaps to record a nearly 1 percent decline for the three months in Maytag's home appliance segment. Net sales were $941.9 million, down from $948.8 million in the second quarter of 2000. Operating income for the segment was $70.2 million, off 51 percent from the $143.3 million recorded in the second quarter of 2000.

For the six months, net sales in the home appliances segment dipped nearly 1 percent to $1.89 billion, compared with $1.90 billion in the same period last year. Operating income for the segment was $155.2 million, down 46.3 percent from the $289.3 million recorded in the first half of last year.

Overall sales at Maytag in the second quarter were down 3.2 percent to $1.07 billion, compared with $1.10 billion in the second quarter last year. Operating income was $61.2 million, a drop of 57.1 percent from the $142.7 million recorded in the same three months in 2000. Net income decreased 66.3 percent to $25.5 million, before the effect of an accounting change, compared with $75.7 million in the same three months last year.

Looking ahead, Ralph F. Hake, Maytag's new chairman/CEO, said, "Although business conditions will remain challenging, we expect improvement in the second half of this year."