- change ups
UFPI Net Sales Are Up 34 Percent
Net earnings for the quarter were $19.8 million, up 15 percent over the prior year’s second quarter. Year-to-date net earnings were $253 million, nearly 17 percent higher than net earnings for the first six months of 2003.
Second quarter net sales by market were:
- $344.6 million in do-it-yourself (D-I-Y) retail, up 14 percent over 2003’s second quarter.
- $170.3 million in site-built construction, an increase of 68.2 percent over the prior year.
- $124.3 million in industrial, up 56.2 percent over last year’s second quarter.
- $103.4 million in manufactured housing, a nearly 50 percent increase over last year.
The company credited strong unit sales in the site-built, industrial and manufactured housing markets for 11 percent of the 34.4 increase in total unit sales and the remaining 23 percent to the lumber market, which was higher during the just-passed quarter.
CEO William Currie said the company expects lumber prices will come down to more “normal” levels by year’s end.
Unit sales in Universal’s D-I-Y market actually declined 7 percent, said CFO Michael Cole. He attributed the decline, in part, to rainy weather in many areas of the country, which the company suspects caused consumers to delay home improvement projects.
“This quarter we went from 37 percent down to 31 percent for Home Depot but still increased our sales by $44 million,” Currie added. He expects Universal will see sales come through later on the D-I-Y projects that homeowners temporarily put on hold.
In addition to “horrible” weather, Universal lost a large truss plant in Ontario to a fire right at the start of the building season, Currie noted.
He also pointed out that five new operations the company opened in the first half of this year haven’t posted any profits yet, and that Universal still faces some challenges with its multi-family framing businesses on the West Coast, which is a new area of business for the company.
“We continue to evaluate our framing operations to become more vertically integrated and provide our customers with turnkey operations. Year to date now we’ve lost about 10 cents a share. We’re correcting that. We’ve replaced people and we’ve got a much better handle and knowledge on what we’re doing in that business. It’s starting to become one of our core businesses.”
On the other hand, Universal’s composite products are doing very well, Currie said.
“Our EverX is in high demand and having good sales. More recently our TechTrim product is really starting to catch on and we’ve got some great new customers for it.”
He said Universal will start a 24/7 production schedule on TechTrim this week.
UFPI reaffirmed its 2004 targets for both unit sales and diluted earnings per share growth of 10 percent and 14 percent, respectively.