William Christopher Wellborn
President and Chief Operating Officer at Mohawk Industries
Thank you, Jim. For the period, our Flooring Rest of World segment sales increased 12.7% as reported and 10.5% on a constant basis. Operating margins were 17.4% as a result of pricing and mix improvements, offset by inflation and a return to more normal seasonality in the period. During the quarter, sales were strong across our product categories and geographies outside those affected by government lockdowns. Overall, raw material supplies continue to impact our operations, with LVT production affected the most during the quarter. We expect that material, energy and transportation inflation will continue and chemical costs that rely on gas will accelerate in upcoming periods.
During the period, COVID shutdowns in Malaysia, Australia and New Zealand interrupted our production and sales. These restrictions have now been lifted, and we are ramping up production to meet demand. Our laminate collections continue to have strong sales growth with consumers embracing our proprietary waterproof products for their performance and realistic visuals. Our new premium laminate introductions feature unique services that replicate handcrafted wood floors. Our sales volume increased during the period, though our margins were pressured by higher-than-anticipated raw material and transportation inflation.
We added new capacity in Europe to meet demand, and we are initiating other projects to support further sales growth. In Russia and Brazil, our laminate businesses are growing as we expand distribution with our leading collections. As anticipated, our LVT sales were lower during the period, given material shortages and lower production that reduced our output. We minimized the impact by improving our product mix and raising prices to pass through inflation. Sales of our higher-value rigid LVT collections with patented water-type joint outperformed and benefited our mix.
We anticipate improved material availability in the fourth quarter to support higher LVT production levels and improve our service. We have announced additional price increases as our energy and material costs continue to rise. Our sheet vinyl production and sales were impacted by tight material supply and transportation bottlenecks and outbound shipments. Our Russian sheet vinyl business performed well with sales growing as our distribution expanded. Our wood plant in Malaysia resumed full operations in September after 12 weeks of government lockdowns due to COVID.
Sales of our wood products will be down in both the third and fourth quarters as our inventories have been depleted. We have acquired a European wood veneer plant to improve supply, yields and cost of our wood flooring. We're introducing waterproof wood collections with our patented Wet Protect Technology in our markets after its successful launch in the U.S. Production stops in Australia and New Zealand reduced our sales and margins, and we are scaling up our operations to meet demand as the markets reopen. Our new premium collections, enhanced merchandising and consumer advertising will benefit our business as the markets return to normal.
We are increasing pricing to offset inflation and transportation costs. Sales of our European insulation panels grew in the period as we implemented another price increase to offset rising material inflation. Our income improved with disruptions in manufacturing due to tight material supplies. We acquired an insulation manufacturer in Ireland and have begun integrating their operations with our existing business. During the third quarter, our panels business grew and margins expanded as we increased our price mix and pricing. We're introducing a new decorative range to enhance our participation in specified markets.
We have added new press that will increase our capacity and add more differentiated features to our products. Our ongoing pricing actions offset rapidly rising material prices, and we will increase prices further in response to inflation. In the fourth quarter, we will complete the acquisition of an MDF manufacturer in France to expand our capacity in Western Europe. The company is a pioneer in bio-based resins, which will enhance our sustainability position. In the third quarter period, our Flooring North America segment sales increased 6.9% and operating margins were 11.3% as reported as a result of productivity, pricing and mix improvements, partially offset by inflation.
Flooring North America had strong results given the material, transportation and labor constraints impacting our sales and production during the period. Supplies of most oil-related chemicals were restricted, creating unscheduled production stops that lowered our sales and raised our costs. We implemented additional price increases across most product categories as inflationary pressures intensified. We continue to streamline our product portfolio and reduce operational complexity, benefiting our efficiencies and quality. In residential carpet, limited material and labor availability are affecting our production and manufacturing costs. We continue to increase prices to recover continued inflation.
Volume and efficiencies are being negatively impacted by low inventories, shorter runs and labor challenges. We are replacing older assets with more efficient equipment, which is improving our labor productivity. We have an elevated backlog, and we plan to run our operations at high levels in the fourth quarter to improve service and replenish inventories. We are enhancing our sales and mix as consumers upgrade their homes with our premium SmartStrand and luxury nylon collections. Commercial sales improved in the period, though the rate of growth has slowed as COVID cases increased.
The government, education and health care sectors outpaced office, retail and hospitality channels which are recovering more slowly. Our hard surface sales are growing as we expand our offering and increase specifications in commercial projects. We are investing in more efficient assets to improve cost, enhance styling and reduce labor requirements. Our laminate and wood business continues to grow, though our sales were restricted by our capacities. Our new laminate line should be operational by the end of this year to expand our sales and provide more advanced features.
Chemical shortages limited our laminate production in the period as we responded by reengineering our formulations to maximize our output. We are reducing complexities to simplify our operations and improve our efficiencies and production. Our new high-performance UltraWood collections are increasing our mix in wood and the productivity of our new plant is improving as volume increases. Our LVT sales increased in the period, even with material supplies limiting production and shipping days in our sourced products. We have improved our mix with enhanced features and lowered our costs by streamlining our processes.
Our plant has increased throughput and yields despite disruptions from a lack of material supply. To support future growth, we are expanding our LVT operations adding approximately $160 million of production, with the initial phase beginning at the end of this year. We are also increasing our sheet vinyl plant's production to satisfy expanding sales of our collections. In the quarter, our Global Ceramic segment sales increased 9.6% as reported and 9.1% on a constant basis.
Operating margins were 11.9% as a result of higher volume, productivity, pricing and mix improvements, partially offset by inflation. Our U.S. Ceramic business grew during the period with the residential sector remaining strong and commercial continuing to show improvement. Our margins improved in the quarter as we implemented price increases to offset higher transportation and raw material costs, enhanced our mix and increased output from our plants.
Additional pricing actions are being taken to offset continuing inflation. We are reducing our manufacturing costs by reengineering our products, utilizing alternative materials and enhancing our logistics strategies. We are introducing higher-value products with new printing technologies, textured finishes and polished services to provide alternatives to premium imported tile. We are growing our studio direct program that focuses on high-end remodeling and exterior collections that sell-through outdoor specialists and home centers. Our quartz countertop sales continue to grow substantially as our production recovered during the period.
Our countertop mix is improving as sales of our higher-end visuals grow at a faster rate. Our Mexican and Brazilian ceramic businesses are growing as we increased prices to offset inflation in both countries. We are refining our product offering, improving our efficiencies and increasing our output. We have expanded our participation in residential projects and commercial sales. We are increasing the number of retailers that exclusively sell our products. We are investing in new manufacturing assets in both countries to expand our production and enhance our product offering. Sales in our European ceramic business remained strong as vacation schedules return to normal.
Increases in price, mix and productivity enhanced our results, though they were more than offset by rising inflation. Our new products with enhanced visuals, unique shapes and large slabs increased our average selling price and improved our mix. We are upgrading production lines to further enhance our styling and improve our efficiencies. In the period, natural gas and electricity prices in Europe rose to unprecedented levels due to anticipated shortages. Our margins will be negatively impacted until our prices align with energy cost in the future.
Sales and margins increased in our Russian ceramic business as enhanced mix and increased prices offset higher inflation. Lower inventories and capacity limitations impacted our sales volume in the period, and we will continue to manage our mix until new capacity is operational. Due to an equipment delay, our production expansion will not be ready until the third quarter of next year. Our sanitary ware sales are growing significantly as we expand production and operate -- and our operations.
With that, I'll return the call to Jeff.