UFPI Reports Record First Quarter Results
“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
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
By market, the Company posted the following first-quarter 2016 gross sales results:
Retail:
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:
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:
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
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
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