UFPI posts record net earnings, net sales; retail and construction markets lead sales gains
July 20 2016 - 4:05PM
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 with our 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 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 also gained market share
with certain customers and grew sales of new products to these
customers. 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 benefited from rising U.S.
housing starts in both site-built and factory-built housing, and a
strong increase in commercial construction spending.
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 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.
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 SIX MONTHS ENDED |
JUNE 2016/2015 |
|
|
Quarter Period |
|
|
|
Year to Date |
|
|
(In thousands, except per share data) |
|
|
2016 |
|
|
|
|
|
2015 |
|
|
|
|
|
2016 |
|
|
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET SALES |
|
$ |
872,093 |
|
|
|
100 |
% |
|
$ |
838,171 |
|
|
|
100 |
% |
|
$ |
1,554,244 |
|
|
|
100 |
% |
|
$ |
1,471,195 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF GOODS SOLD |
|
|
740,606 |
|
|
|
84.9 |
|
|
|
725,728 |
|
|
|
86.6 |
|
|
|
1,320,018 |
|
|
|
84.9 |
|
|
|
1,279,170 |
|
|
|
86.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
131,487 |
|
|
|
15.1 |
|
|
|
112,443 |
|
|
|
13.4 |
|
|
|
234,226 |
|
|
|
15.1 |
|
|
|
192,025 |
|
|
|
13.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELLING,
GENERAL
AND |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADMINISTRATIVE
EXPENSES |
|
|
77,762 |
|
|
|
8.9 |
|
|
|
68,431 |
|
|
|
8.2 |
|
|
|
148,601 |
|
|
|
9.6 |
|
|
|
130,136 |
|
|
|
8.8 |
|
NET (GAIN) LOSS ON DISPOSITION AND |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IMPAIRMENT OF ASSETS |
|
|
60 |
|
|
|
- |
|
|
|
(176 |
) |
|
|
- |
|
|
|
50 |
|
|
|
- |
|
|
|
(162 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS FROM OPERATIONS |
|
|
53,665 |
|
|
|
6.2 |
|
|
|
44,188 |
|
|
|
5.3 |
|
|
|
85,575 |
|
|
|
5.5 |
|
|
|
62,051 |
|
|
|
4.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER EXPENSE, NET |
|
|
785 |
|
|
|
0.1 |
|
|
|
1,238 |
|
|
|
0.1 |
|
|
|
1,675 |
|
|
|
0.1 |
|
|
|
2,193 |
|
|
|
0.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS BEFORE INCOME TAXES |
|
|
52,880 |
|
|
|
6.1 |
|
|
|
42,950 |
|
|
|
5.1 |
|
|
|
83,900 |
|
|
|
5.4 |
|
|
|
59,858 |
|
|
|
4.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAXES |
|
|
18,643 |
|
|
|
2.1 |
|
|
|
16,066 |
|
|
|
1.9 |
|
|
|
29,407 |
|
|
|
1.9 |
|
|
|
22,170 |
|
|
|
1.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET EARNINGS |
|
|
34,237 |
|
|
|
3.9 |
|
|
|
26,884 |
|
|
|
3.2 |
|
|
|
54,493 |
|
|
|
3.5 |
|
|
|
37,688 |
|
|
|
2.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LESS NET EARNINGS ATTRIBUTABLE TO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONCONTROLLING
INTEREST |
|
|
(839 |
) |
|
|
(0.1 |
) |
|
|
(908 |
) |
|
|
(0.1 |
) |
|
|
(1,882 |
) |
|
|
(0.1 |
) |
|
|
(1,550 |
) |
|
|
(0.1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET EARNINGS ATTRIBUTABLE TO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTROLLING INTEREST |
|
$ |
33,398 |
|
|
|
3.8 |
|
|
$ |
25,976 |
|
|
|
3.1 |
|
|
$ |
52,611 |
|
|
|
3.4 |
|
|
$ |
36,138 |
|
|
|
2.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE -
BASIC |
|
$ |
1.64 |
|
|
|
|
$ |
1.29 |
|
|
|
|
$ |
2.59 |
|
|
|
|
$ |
1.79 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE - DILUTED |
|
$ |
1.64 |
|
|
|
|
$ |
1.28 |
|
|
|
|
$ |
2.58 |
|
|
|
|
$ |
1.79 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE INCOME |
|
|
33,430 |
|
|
|
|
|
26,358 |
|
|
|
|
|
54,128 |
|
|
|
|
|
36,159 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LESS COMPREHENSIVE INCOME ATTRIBUTABLE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TO NONCONTROLLING
INTEREST |
|
|
(235 |
) |
|
|
|
|
(636 |
) |
|
|
|
|
(1,081 |
) |
|
|
|
|
(1,133 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ATTRIBUTABLE TO CONTROLLING
INTEREST |
|
$ |
33,195 |
|
|
|
|
$ |
25,722 |
|
|
|
|
$ |
53,047 |
|
|
|
|
$ |
35,026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL SALES DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Period |
|
Year to Date |
Market Classification |
|
|
2016 |
|
|
|
|
|
2015 |
|
|
% |
|
|
2016 |
|
|
|
|
|
2015 |
|
|
% |
Retail |
|
$ |
406,738 |
|
|
|
|
$ |
378,357 |
|
|
|
8 |
% |
|
$ |
677,481 |
|
|
|
|
$ |
609,804 |
|
|
|
11 |
% |
Industrial |
|
|
231,388 |
|
|
|
|
|
238,372 |
|
|
|
-3 |
% |
|
|
435,632 |
|
|
|
|
|
448,388 |
|
|
|
-3 |
% |
Construction |
|
|
249,261 |
|
|
|
|
|
234,112 |
|
|
|
6 |
% |
|
|
468,138 |
|
|
|
|
|
434,418 |
|
|
|
8 |
% |
Total Gross Sales |
|
|
887,387 |
|
|
|
|
|
850,841 |
|
|
|
4 |
% |
|
|
1,581,251 |
|
|
|
|
|
1,492,610 |
|
|
|
6 |
% |
Sales Allowances |
|
|
(15,294 |
) |
|
|
|
|
(12,670 |
) |
|
|
|
|
(27,007 |
) |
|
|
|
|
(21,415 |
) |
|
|
Total Net Sales |
|
$ |
872,093 |
|
|
|
|
$ |
838,171 |
|
|
|
|
$ |
1,554,244 |
|
|
|
|
$ |
1,471,195 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED) |
JUNE 2016/2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
2016 |
|
|
|
2015 |
|
|
LIABILITIES AND EQUITY |
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
87,517 |
|
|
$ |
24,756 |
|
|
|
Cash overdraft |
|
$ |
- |
|
|
$ |
21,933 |
|
|
Restricted cash |
|
|
909 |
|
|
|
710 |
|
|
|
Accounts payable |
|
|
126,095 |
|
|
|
114,354 |
|
|
Investments |
|
|
9,740 |
|
|
|
- |
|
|
|
Accrued
liabilities |
|
|
111,995 |
|
|
|
97,069 |
|
|
Accounts receivable |
|
|
318,505 |
|
|
|
302,538 |
|
|
|
Current portion of
debt |
|
|
1,093 |
|
|
|
893 |
|
|
Inventories |
|
|
297,796 |
|
|
|
330,235 |
|
|
|
|
|
|
|
|
|
|
Other current assets |
|
|
15,238 |
|
|
|
21,205 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT ASSETS |
|
|
729,705 |
|
|
|
679,444 |
|
|
TOTAL CURRENT
LIABILITIES |
|
|
239,183 |
|
|
|
234,249 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS |
|
|
10,011 |
|
|
|
9,986 |
|
|
LONG-TERM DEBT
AND |
|
|
|
|
INTANGIBLE ASSETS, NET |
|
|
197,891 |
|
|
|
192,505 |
|
|
|
CAPITAL LEASE
OBLIGATIONS |
|
|
84,530 |
|
|
|
122,303 |
|
PROPERTY, PLANT |
|
|
|
|
|
OTHER
LIABILITIES |
|
|
51,158 |
|
|
|
50,302 |
|
|
AND EQUIPMENT,
NET |
|
|
256,899 |
|
|
|
257,731 |
|
|
EQUITY |
|
|
819,635 |
|
|
|
732,812 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
1,194,506 |
|
|
$ |
1,139,666 |
|
|
TOTAL
LIABILITIES AND EQUITY |
|
$ |
1,194,506 |
|
|
$ |
1,139,666 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED CONDENSED STATEMENTS OF CASH
FLOWS (UNAUDITED) |
FOR THE SIX MONTHS ENDED |
JUNE 2016/2015 |
(In thousands) |
|
|
|
|
2016 |
|
|
|
|
|
2015 |
|
CASH FLOWS FROM OPERATING
ACTIVITIES: |
|
|
|
|
|
|
Net earnings |
|
|
|
$ |
54,493 |
|
|
|
|
$ |
37,688 |
|
Adjustments to reconcile net earnings to net cash from
operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
19,178 |
|
|
|
|
|
18,406 |
|
Amortization of intangibles |
|
|
|
1,285 |
|
|
|
|
|
1,888 |
|
Expense associated with share-based compensation arrangements |
|
|
977 |
|
|
|
|
|
874 |
|
Excess tax benefits from share-based compensation arrangements |
|
|
- |
|
|
|
|
|
(33 |
) |
Expense associated with stock grant plans |
|
|
|
70 |
|
|
|
|
|
53 |
|
Deferred income tax |
|
|
|
55 |
|
|
|
|
|
3 |
|
Equity in earnings of investee |
|
|
|
(192 |
) |
|
|
|
|
(195 |
) |
Net loss (gain) on disposition and impairment of assets |
|
|
50 |
|
|
|
|
|
(162 |
) |
Changes in: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
|
(95,198 |
) |
|
|
|
|
(104,929 |
) |
Inventories |
|
|
|
|
7,564 |
|
|
|
|
|
9,806 |
|
Accounts payable and cash overdraft |
|
|
|
31,320 |
|
|
|
|
|
45,798 |
|
Accrued liabilities and other |
|
|
|
20,439 |
|
|
|
|
|
27,625 |
|
NET CASH FROM OPERATING
ACTIVITIES |
|
|
40,041 |
|
|
|
|
|
36,822 |
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES: |
|
|
|
|
|
|
Purchases of property, plant, and equipment |
|
|
|
(24,269 |
) |
|
|
|
|
(27,756 |
) |
Proceeds from sale of property, plant and
equipment |
|
|
309 |
|
|
|
|
|
1,085 |
|
Acquisitions, net of cash received |
|
|
|
(1,682 |
) |
|
|
|
|
(2,584 |
) |
Purchases of noncontrolling interest |
|
|
|
(1,100 |
) |
|
|
|
|
(1,256 |
) |
Advances of notes receivable |
|
|
|
(2,946 |
) |
|
|
|
|
(3,083 |
) |
Collections of notes receivable and related
interest |
|
|
3,731 |
|
|
|
|
|
7,059 |
|
Purchases of investments |
|
|
|
(3,571 |
) |
|
|
|
|
- |
|
Proceeds from sale of investments |
|
|
|
901 |
|
|
|
|
|
- |
|
Cash restricted as to use |
|
|
|
(323 |
) |
|
|
|
|
(305 |
) |
Other, net |
|
|
|
|
|
(736 |
) |
|
|
|
|
(58 |
) |
NET CASH USED IN INVESTING
ACTIVITIES |
|
|
(29,686 |
) |
|
|
|
|
(26,898 |
) |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES: |
|
|
|
|
|
|
Borrowings under revolving credit facilities |
|
|
|
3,162 |
|
|
|
|
|
259,734 |
|
Repayments under revolving credit facilities |
|
|
|
(3,210 |
) |
|
|
|
|
(235,993 |
) |
Proceeds from issuance of common stock |
|
|
|
290 |
|
|
|
|
|
724 |
|
Distributions to noncontrolling interest |
|
|
|
(1,731 |
) |
|
|
|
|
(1,250 |
) |
Dividends paid to shareholders |
|
|
|
(8,529 |
) |
|
|
|
|
(8,050 |
) |
Repurchase of common stock |
|
|
|
- |
|
|
|
|
|
(77 |
) |
Other, net |
|
|
|
|
|
(15 |
) |
|
|
|
|
24 |
|
NET CASH (USED IN) FROM FINANCING
ACTIVITIES |
|
|
(10,033 |
) |
|
|
|
|
15,112 |
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash |
|
|
|
(561 |
) |
|
|
|
|
(280 |
) |
NET CHANGE IN CASH AND CASH
EQUIVALENTS |
|
|
(239 |
) |
|
|
|
|
24,756 |
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD |
|
|
87,756 |
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF
PERIOD |
|
$ |
87,517 |
|
|
|
|
$ |
24,756 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lynn Afendoulis
Director, Corporate Communications
(616) 365-1502
UFP Industries (NASDAQ:UFPI)
Historical Stock Chart
From Mar 2024 to Apr 2024
UFP Industries (NASDAQ:UFPI)
Historical Stock Chart
From Apr 2023 to Apr 2024