UFPI UFP Industries Inc

Universal Forest Products, Inc. (Nasdaq:UFPI) today announced first-quarter net earnings attributable to controlling interest of $19.2 million, up 89 percent over the same period of 2015. Diluted earnings per share were $0.95, compared to $0.51 for the first quarter of 2015. Net sales for the first quarter were $682.2 million, up 7.8 percent over the first quarter of 2015. The net earnings and net sales results are first-quarter records for the Company.

“The record-breaking results we have enjoyed since the third quarter of 2015 are a testament to the outstanding efforts of our people and the strategies we have implemented to grow and improve the business,” said CEO Matt Missad. “Rather than become complacent, we are targeting new opportunities for growth and improved profitability, while enhancing value for our customers.”

The first-quarter sales growth is attributable to increases in the Company’s retail and construction markets, which grew 17 percent and 9.3 percent, respectively, despite a 12 percent decline in year-over-year lumber prices in the first quarter.

“While the milder winter contributed to improved quarter-over-quarter results, we also benefitted from increased new product sales, operational efficiency improvements, and a better sales mix,” Matt reported. New product sales for the quarter rose 32 percent to $67.5 million, up from $51 million during the same period in 2015.

By market, the Company posted the following first-quarter 2016 gross sales results:

Retail: $270.7 million, up 17 percent over the same period of 2015

The Company saw increases in unit sales to both its big box and independent retail customers as a result of improving demand and success in the Company’s new product sales initiative. The sales were partially offset by a 2 percent decrease in selling prices due to the commodity lumber market. The Company believes it is well-positioned to meet the growing demand of customers as the spring building season begins. It remains focused on enhancing its product offerings by creating new products and improving upon existing products, and increasing its market share with independent retailers.

Industrial: $204.2 million, down 3 percent from the first quarter of 2015

This market includes packaging, material handling and related products, and other wood-based products for many other applications that serve a variety of industrial customers. The Company’s unit sales increased 5 percent as a result of organic growth from adding new customers and growing market share with existing customers. Gross sales fell 3 percent due to an 8 percent decrease in selling prices due to lower lumber costs. The Company remains focused on adding new customers, expanding its product and service offering, adding capacity in certain regions, and growing its business in non-wood packaging materials.

Construction: $218.9 million, up 9 percent over the same period of 2015

This market includes residential and manufactured housing and commercial construction. The Company’s growth in this market was attributable to a 15 percent increase in unit sales, led by strong sales in commercial and residential construction. Gross sales were partially offset by a 6 percent decrease in selling prices.  

CONFERENCE CALL

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 Thurs., April 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 pass code 88497073. 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 May 15, 2016, at 855-859-2056 or 404-537-3406 or 800-585-8367.

UNIVERSAL FOREST PRODUCTS, INC.

Universal Forest Products, Inc. is a holding company that provides capital, management and administrative resources to subsidiaries in three robust markets: retail, construction and industrial. Founded in 1955, the Company is headquartered in Grand Rapids, Mich., with affiliates throughout North America and Australia. For more about Universal Forest Products, go to www.ufpi.com.

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, as amended, that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the markets we serve, the economy and the Company itself. Words like “anticipates,” “believes,” “confident,” “estimates,” “expects,” “forecasts,” “likely,” “plans,” “projects,” “should,” variations of such words, and similar expressions identify such forward-looking statements. These statements do not guarantee future performance and involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. The Company does not undertake to update forward-looking statements to reflect facts, circumstances, events, or assumptions that occur after the date the forward-looking statements are made. Actual results could differ materially from those included in such forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainty. Among the factors that could cause actual results to differ materially from forward-looking statements are the following: fluctuations in the price of lumber; adverse or unusual weather conditions; adverse economic conditions in the markets we serve; government regulations, particularly involving environmental and safety regulations; and our ability to make successful business acquisitions. Certain of these risk factors as well as other risk factors and additional information are included in the Company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission.

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2016/2015
		Quarter Period																Year to Date
(In thousands, except per share data)			2016								2015								2016								2015
NET SALES		$	682,151				100	%		$	633,025				100	%		$	682,151				100	%		$	633,025				100.0	%
COST OF GOODS SOLD			579,412				84.9				553,443				87.4				579,412				84.9				553,443				87.4
GROSS PROFIT			102,739				15.1				79,582				12.6				102,739				15.1				79,582				12.6
SELLING,  GENERAL  AND
ADMINISTRATIVE  EXPENSES			70,838				10.4				61,705				9.7				70,838				10.4				61,705				9.7
NET (GAIN) LOSS ON DISPOSITION AND
IMPAIRMENT OF ASSETS			(10	)			-				14				-				(10	)			-				14				-
EARNINGS FROM OPERATIONS			31,911				4.7				17,863				2.8				31,911				4.7				17,863				2.8
OTHER EXPENSE, NET			891				0.1				955				0.2				891				0.1				955				0.2
EARNINGS BEFORE INCOME TAXES			31,020				4.5				16,908				2.7				31,020				4.5				16,908				2.7
INCOME TAXES			10,765				1.6				6,104				1.0				10,765				1.6				6,104				1.0
NET EARNINGS			20,255				3.0				10,804				1.7				20,255				3.0				10,804				1.7
LESS NET EARNINGS ATTRIBUTABLE TO
NONCONTROLLING INTEREST			(1,043	)			(0.2	)			(642	)			(0.1	)			(1,043	)			(0.2	)			(642	)			(0.1	)
NET EARNINGS ATTRIBUTABLE TO
CONTROLLING INTEREST		$	19,212				2.8			$	10,162				1.6			$	19,212				2.8			$	10,162				1.6
EARNINGS PER SHARE - BASIC		$	0.95							$	0.51							$	0.95							$	0.51
EARNINGS PER SHARE - DILUTED		$	0.95							$	0.51							$	0.95							$	0.51
COMPREHENSIVE INCOME			20,697								9,801								20,697								9,801
LESS COMPREHENSIVE INCOME ATTRIBUTABLE
TO NONCONTROLLING INTEREST			(846	)							(498	)							(846	)							(498	)
COMPREHENSIVE INCOME
ATTRIBUTABLE TO CONTROLLING INTEREST		$	19,851							$	9,303							$	19,851							$	9,303
SUPPLEMENTAL SALES DATA
		Quarter Period																Year to Date
Market Classification			2016								2015			%					2016								2015			%
Retail		$	270,743							$	231,447				17	%		$	270,743							$	231,447				17	%
Industrial			204,245								210,016				-3	%			204,245								210,016				-3	%
Construction			218,876								200,306				9	%			218,876								200,306				9	%
Total Gross Sales			693,864								641,769				8	%			693,864								641,769				8	%
Sales Allowances			(11,713	)							(8,744	)							(11,713	)							(8,744	)
Total Net Sales		$	682,151							$	633,025							$	682,151							$	633,025

 

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
MARCH 2016/2015
(In thousands)
ASSETS					2016				2015			LIABILITIES AND EQUITY					2016				2015
CURRENT ASSETS												CURRENT LIABILITIES
	Cash and cash equivalents			$	43,065			$	22,888				Cash overdraft			$	-			$	21,585
	Restricted cash				1,139				710				Accounts payable				116,525				114,225
	Investments				6,737				-				Accrued liabilities				97,910				79,326
	Accounts receivable				287,374				260,926				Current portion of debt				886				21
	Inventories				327,177				404,711
	Other current assets				16,889				19,984
TOTAL CURRENT ASSETS					682,381				709,219			TOTAL CURRENT LIABILITIES					215,321				215,157
OTHER ASSETS					10,424				9,674			LONG-TERM DEBT AND
INTANGIBLE ASSETS, NET					198,338				193,113				CAPITAL LEASE OBLIGATIONS				84,525				187,020
PROPERTY, PLANT												OTHER LIABILITIES					51,003				50,309
	AND EQUIPMENT,  NET				254,634				255,462			EQUITY					794,928				714,982
TOTAL ASSETS				$	1,145,777			$	1,167,468			TOTAL LIABILITIES AND EQUITY				$	1,145,777			$	1,167,468

 

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2016/2015
(In thousands)						2016						2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings					$	20,255					$	10,804
Adjustments to reconcile net earnings to net cash from operating activities:
Depreciation						9,492						8,996
Amortization of intangibles						693						983
Expense associated with share-based compensation arrangements						432						378
Expense associated with stock grant plans						37						27
Deferred income tax credit						(156	)					(193	)
Equity in earnings of investee						(81	)					(83	)
Net loss (gain) on disposition and impairment of assets						(10	)					14
Changes in:
Accounts receivable						(64,276	)					(63,148	)
Inventories						(22,159	)					(64,422	)
Accounts payable and cash overdraft						21,498						45,219
Accrued liabilities and other						4,318						10,880
NET CASH FROM OPERATING ACTIVITIES						(29,957	)					(50,545	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment						(12,941	)					(15,102	)
Proceeds from sale of property, plant and equipment						132						50
Acquisitions, net of cash received						-						(2,585	)
Advances of notes receivable						(1,259	)					(1,273	)
Collections of notes receivable and related interest						1,408						5,790
Cash restricted as to use						(553	)					(305	)
Other, net						(173	)					(16	)
NET CASH FROM INVESTING ACTIVITIES						(13,386	)					(13,441	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit facilities						1,235						140,303
Repayments under revolving credit facilities						(1,495	)					(52,718	)
Proceeds from issuance of common stock						130						469
Distributions to noncontrolling interest						(1,170	)					(939	)
Repurchase of common stock						-						(78	)
Other, net						(5	)					(9	)
NET CASH FROM FINANCING ACTIVITIES						(1,305	)					87,028
Effect of exchange rate changes on cash						(43	)					(154	)
NET CHANGE IN CASH AND CASH EQUIVALENTS						(44,691	)					22,888
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD						87,756						-
CASH AND CASH EQUIVALENTS, END OF PERIOD					$	43,065					$	22,888

 

Lynn Afendoulis
Director, Corporate Communications
(616) 365-1502