Armstrong World Industries Inc
We are a leading global producer of ceiling systems and, prior to April 1,
2016, flooring products for use primarily in the construction and renovation
of residential, commercial and institutional buildings. We design, manufacture
and sell ceiling systems (primarily mineral fiber, fiberglass wool and metal)
and, prior to April 1, 2016, flooring products (primarily resilient and wood)
around the world.
We are well positioned in the industry segments and markets in which we operate,
often holding a leadership or significant market share position. The major markets
in which we compete are:
North American Commercial. Many of our products are used in commercial and institutional
buildings. Our revenue opportunities come from new construction as well as renovation
of existing buildings. Renovation work is estimated to represent the majority
of the total North American commercial market opportunity. Most of our revenue
comes from four major segments of commercial building – office, education,
retail and healthcare. We monitor U.S. construction starts and follow project
activity. Our revenue from new construction can lag behind construction starts
by as much as 18 to 24 months. We also monitor office vacancy rates, gross domestic
product (“GDP”) and general employment levels, which can indicate
movement in renovation and new construction opportunities. We believe that these
statistics, taking into account the time-lag effect, provide a reasonable indication
of our future revenue opportunity from commercial renovation and new construction.
However, we believe that consumers’ preferences for product type, style,
color, availability, affordability and ease of installation also affect our
revenue.
North American Residential. Our Americas segment sells products for use in single
and multi-family housing. Our products compete against mineral fiber and fiberglass
products from other manufacturers, as well as drywall. We compete directly with
other domestic and international suppliers of these products. We estimate that
existing home renovation (also known as replacement / remodel) work represents
the majority of the total North American residential market opportunity. Key
U.S. statistics that indicate market opportunity include existing home sales
(a key indicator for renovation opportunity), housing starts, housing completions,
home prices, interest rates and consumer confidence.