Universal Forest Products®, Inc. Announces Record First Quarter Earnings of $0.30 Per Share
GRAND RAPIDS, Mich., April 18 /PRNewswire/ -- Universal Forest Products®, Inc. (Nasdaq: UFPI) today announced results for the first quarter of 2000, including record earnings per share of $0.30 (diluted) vs. $0.25 (diluted) for the first quarter of 1999. Net sales for the first quarter were $304.1 million, compared with $300.2 million for the same 1999 quarter, a 1.3% increase. Net earnings increased 13.4% to $6.1 million from $5.4 million for the comparable quarter.
"Our performance this quarter reflects the success of our strategy to be the leading supplier in four related, but diverse, markets," said William G. Currie, UFPI's chief executive officer. "Despite the challenges we faced in the first quarter, including continued weakness in the manufactured housing industry and severe winter weather during January and February which curtailed sales in the Mid-Atlantic States, we still reported increased sales and record first quarter profits. Our strategy to diversify our sales across four market segments, and geographically across the United States, dilutes the effect of negative economic or weather related events and allows us to balance our business. Going forward, we expect continued growth in our Do-It-Yourself retail and industrial/agricultural market segments, which increased sales 12% and 19% respectively, as well as an upturn in sales growth in the site-built construction market resulting from increased demand for engineered wood components and our additional capacity to supply this demand."
FINANCIAL HIGHLIGHTS Three Months and YTD % Change
Period Ended March 25/27 2000 1999
(In thousands, except per share data)
Net sales $304,072 $300,180 +1.3
Gross profit 40,411 39,757 +1.6
Net earnings 6,081 5,361 +13.4
Earnings per share (Diluted) $0.30 $0.25 +20.0
Weighted average shares
outstanding with common
stock equivalents 20,524 21,415 -4.2
Since the beginning of the year, the company has announced three new acquisitions. Letters of intent have been signed to acquire three lumber treating facilities in Youngstown, Ohio; Blanchester, Ohio; and Westville, Indiana, from Walker-Williams Lumber Company, and two combination lumber treating and remanufacturing facilities from Aljoma Lumber of Medley, Florida. The company also closed on the purchase of 50% of the outstanding shares of ECJW Holdings Inc., of London, Ontario, and its wholly-owned subsidiaries, Thorndale Roof Systems and Edcor Floor Systems.
"During the sixteen months from December of 1997 to March of 1999, we completed 13 transactions," continued Currie. "Since March of 1999, we have been working to integrate those acquisitions and develop a pipeline of new opportunities. We remain disciplined in our acquisition strategy to acquire strategically located, 'best in class,' companies that are accretive to earnings and can operate autonomously while achieving the company's revenue and growth targets. We feel strongly that our recent acquisitions meet these and other stringent criteria," concluded Currie.
Universal Forest Products®, Inc. markets, manufactures, and engineers products for D-I-Y retail home centers, structural lumber products for the manufactured housing industry, engineered wood components for the site-built construction market, and specialty wood packaging for various industries. For information about Universal Forest Products®, Inc. on the Internet, please contact the company's investor relations web site at www.ufpi.com , or call 1-888-Buy-UFPI.
Included in this report are certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are based on the beliefs of the Company's management as well as on assumptions made by and information currently available to the Company at the time such statements were 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. These risk factors and additional information are included in the company's reports on Form 10K and 10Q on file with the Securities and Exchange Commission.
CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2000/1999
Quarter Period
(In thousands, except per share data) 2000 1999
NET SALES $304,072 100% $300,180 100%
COST OF GOODS SOLD 263,661 86.71 260,423 86.76
GROSS PROFIT 40,411 13.29 39,757 13.24
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 27,318 8.98 28,385 9.46
EARNINGS FROM OPERATIONS 13,093 4.31 11,372 3.79
INTEREST EXPENSE 3,168 1.04 2,919 0.97
INTEREST REVENUE (86) -0.03 (149) -0.05
3,082 1.01 2,770 0.92
EARNINGS BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY
IN EARNINGS OF INVESTEE 10,011 3.29 8,602 2.87
INCOME TAXES 3,953 1.30 3,355 1.12
EARNINGS BEFORE MINORITY
INTEREST AND EQUITY IN
EARNINGS OF INVESTEE 6,058 1.99 5,247 1.75
MINORITY INTEREST (23) -0.01 (81) -0.03
EQUITY IN EARNINGS
OF INVESTEE 46 0.02 195 0.06
NET EARNINGS $6,081 2.00 $5,361 1.79
EARNINGS PER SHARE - BASIC $0.30 $0.26
EARNINGS PER SHARE - DILUTED $0.30 $0.25
WEIGHTED AVERAGE SHARES
OUTSTANDING 20,135 20,710
WEIGHTED AVERAGE SHARES
OUTSTANDING WITH COMMON
STOCK EQUIVALENTS 20,524 21,415
Year to Date
(In thousands, except per share data) 2000 1999
NET SALES $304,072 100% $300,180 100%
COST OF GOODS SOLD 263,661 86.71 260,423 86.76
GROSS PROFIT 40,411 13.29 39,757 13.24
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 27,318 8.98 28,385 9.46
EARNINGS FROM OPERATIONS 13,093 4.31 11,372 3.79
INTEREST EXPENSE 3,168 1.04 2,919 0.97
INTEREST REVENUE (86) -0.03 (149) -0.05
3,082 1.01 2,770 0.92
EARNINGS BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY
IN EARNINGS OF INVESTEE 10,011 3.29 8,602 2.87
INCOME TAXES 3,953 1.30 3,355 1.12
EARNINGS BEFORE MINORITY
INTEREST AND EQUITY IN
EARNINGS OF INVESTEE 6,058 1.99 5,247 1.75
MINORITY INTEREST (23) -0.01 (81) -0.03
EQUITY IN EARNINGS
OF INVESTEE 46 0.02 195 0.06
NET EARNINGS $6,081 2.00 $5,361 1.79
EARNINGS PER SHARE - BASIC $0.30 $0.26
EARNINGS PER SHARE - DILUTED $0.30 $0.25
WEIGHTED AVERAGE SHARES
OUTSTANDING 20,135 20,710
WEIGHTED AVERAGE SHARES
OUTSTANDING WITH COMMON
STOCK EQUIVALENTS 20,524 21,415
SUPPLEMENTAL SALES DATA
Quarter Period
Market Classification 1999 % 1998 %
Do-It-Yourself $134,280 44% $120,177 40%
Manufactured Housing 78,182 26% 96,258 32%
Site-Built Construction 48,615 16% 47,507 16%
Industrial and Other 42,995 14% 36,238 12%
Total $304,072 100% $300,180 100%
Year to Date
Market Classification 1999 % 1998 %
Do-It-Yourself $134,280 44% $120,177 40%
Manufactured Housing 78,182 26% 96,258 32%
Site-Built Construction 48,615 16% 47,507 16%
Industrial and Other 42,995 14% 36,238 12%
Total $304,072 100% $300,180 100%
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
MARCH 2000/1999
(In thousands)
ASSETS 2000 1999
CURRENT ASSETS
Cash and cash equivalents $2,405 $2,189
Accounts receivable 107,051 92,613
Inventories 159,629 148,713
Other current assets 7,231 7,458
TOTAL CURRENT ASSETS 276,316 250,973
OTHER ASSETS 10,988 10,095
GOODWILL AND NON-COMPETE 92,424 95,085
PROPERTY, PLANT
AND EQUIPMENT, NET 152,432 138,144
TOTAL ASSETS $532,160 $494,297
LIABILITIES AND SHAREHOLDERS'
EQUITY 2000 1999
CURRENT LIABILITIES
Notes payable $1,428 $2,038
Accounts payable and
accrued liabilities 96,127 86,106
Current portion of long-term
debt and capital leases 7,277 9,182
TOTAL CURRENT LIABILITIES 104,832 97,326
LONG-TERM DEBT AND CAPITAL
LEASES, less current portion 136,902 135,782
REVOLVING CREDIT FACILITY 54,800 49,600
OTHER LIABILITIES 16,662 15,028
SHAREHOLDERS' EQUITY 218,964 196,561
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $532,160 $494,297
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2000/1999
(In thousands) 2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $6,081 $5,361
Adjustments to reconcile net earnings
to net cash from operating activities:
Depreciation 3,830 3,571
Amortization of non-compete agreements
and goodwill 791 821
(Gain) loss on sale of property,
plant and equipment (88) 17
Changes in:
Accounts receivable (37,040) (29,767)
Inventories (28,095) (40,314)
Other 7,232 176
Accounts payable 22,737 21,755
Accrued liabilities (12,321) (3,285)
NET CASH FROM OPERATING ACTIVITIES
(36,873) (41,665)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and
equipment (7,271) (9,746)
Proceeds from sale of property,
plant and equipment 209 -
Other (261) 831
NET CASH FROM INVESTING ACTIVITIES (7,323) (8,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt (379) (836)
Proceeds from issuance of long-term debt 1,949 20,300
Net borrowings (repayments) under
revolving credit facility and notes
payable 42,908 33,262
Proceeds from issuance of common stock 66 61
Repurchase of common stock (2,049) (938)
NET CASH FROM FINANCING ACTIVITIES 42,495 51,849
NET CHANGE IN CASH AND CASH EQUIVALENTS (1,701) 1,269
CASH AND CASH EQUIVALENTS, BEGINNING
OF YEAR 4,106 920
CASH AND CASH EQUIVALENTS, END OF PERIOD $2,405 $2,189
SOURCE Universal Forest Products(R), Inc.
CONTACT: Charles R. Felix, Sr. V.P. Development, 616-364-6161, or Michael R. Cole, V.P. of Finance, 616-364-6161, both of Universal Forest Products®, Inc.; or Matthew Della Croce, Vice President, 212-453-2316, or Pat McCoy, Managing Supervisor, 212-453-2272, both of Fleischman Hillard