– Profits up 28.6 percent over previous year –
GRAND RAPIDS, Mich., July 20, 2016 (GLOBAL NEWSWIRE) – Universal Forest Products, Inc. (Nasdaq: UFPI) today reported net earnings attributable to controlling interest of $33.4 million for the second quarter of 2016, up 28.6 percent over net earnings attributable to controlling interest of $26.0 million for the same period of 2015. Second-quarter 2016 diluted earnings per share were $1.64, compared to diluted earnings per share of $1.28 for the second quarter of 2015. Net sales of $872.1 million in the second quarter of 2016 represent an increase of 4.0 percent over net sales of $838.2 for the same period of 2015. The net earnings and net sales numbers are the best of any quarter in the Company’s history.
The Company’s results were driven by strong sales gains in the retail and construction markets, which grew 7.5 and 6.5 percent, respectively, over the same period of last year.
“The employees of the companies of Universal delivered another outstanding quarter,” said CEO Matthew J. Missad. “The results confirm that our growth and improvement strategies, coupled withour balanced business model, are working. When we break records, we simply are setting the bar for the next record. We look forward to the challenge of trying to stay ahead of 2015’s record performance in the second half of the year. Fortunately, we have talented and hard-working employees who can make that happen.
Missad noted that new product sales grew 9.2 percent over the second quarter of 2015, and that the Company’s product mix continues to drive improvements in gross margins. Lower industrial production in the U.S. and a strong U.S. dollar adversely affected the Company’s industrial business during the second quarter.
Recently announced acquisitions – Idaho Western in Nampa, Idaho, and Tampa, Fla.-based Robbins Manufacturing Co. – are expected to add $100 million in annual gross sales.
By market, the Company posted the following gross sales results:
Retail: $406.7 million, up 7.5 percent over the second quarter of 2015
The Company’s performance in this market benefited from pent-up demand in the busy building season following challenging winter weather, success with new product sales, and growth with independent and big box retailers, the latter of which saw healthy increases in comparable store sales in their most recently reported quarters. The Company anticipates healthy demand through the building season, barring adverse weather conditions and other unforeseen events.
Industrial: $231.4 million, down 2.9 percent over the second quarter of 2015
In this market, the Company sells packaging and material handling and related products for industrial and agricultural customers. Sales in this market have been adversely affected by a decrease in U.S. industrial production, which fell 0.7 percent year-over-year in the most recently reported month, and a strong U.S. dollar, which has adversely impacted the export sales of industrial customers. The Company also is being more selective by pursuing greater value-added business, which has contributed to improved gross profit margins in this market. It remains committed to growing industrial sales organically, through acquisitions, and by increasing its share of the market.
Construction: $249.3 million, up 6.5 percent over the same period of 2015
The Company saw unit sales increases of 10 percent in its residential construction business and 4 percent in commercial construction. The Company has benefitted from rising U.S. housing starts in both site-built and factory-built housing, and a strong increase in commercial construction spending.
Universal Forest Products will conduct a conference call to discuss information included in this news release and related matters at 8:30 a.m. ET on Thursday, July 21, 2016. The call will be hosted by CEO Matthew J. Missad and CFO Michael Cole, and will be available for analysts and institutional investors domestically at (888) 685-5759 and internationally at (503) 343-6031. Use conference ID 48931902. The conference call will be available simultaneously and in its entirety to all interested investors and news media through a webcast at http://www.ufpi.com. A replay of the call will be available through August 20, 2016, at any of the following numbers: (855) 859-2056 or (404) 537-3406 or (800) 585-8367.