UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report: July 13, 2004 UNIVERSAL FOREST PRODUCTS, INC. (Exact name of registrant as specified in its charter) MICHIGAN 0-22684 38-1465835 (State or other jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 2801 EAST BELTLINE, NE GRAND RAPIDS, MICHIGAN 49525 (Address of principal executive offices) (Zip Code) (616) 364-6161 (Registrant's telephone number, including area code) NONE (Former name or former address, if changed since last report)
Item 7. Financial Statements, Pro Forma Financial Information, and Exhibits (c) Exhibits 99(a) Press Release dated July 12, 2004. Item 12. Results of Operations and Financial Condition On July 12, 2004, the Registrant issued a press release announcing its financial results for the quarter ended June 26, 2004. A copy of the Registrant's press release is attached as Exhibit 99(a) to this Current Report. 2
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. UNIVERSAL FOREST PRODUCTS, INC. (Registrant) Dated: July 13, 2004 By: /s/ Michael R. Cole ----------------------------------------- Michael R. Cole, Chief Financial Officer and Treasurer 3
EXHIBIT INDEX Exhibit Number Document 99(a) Press Release dated July 12, 2004.
EXHIBIT 99(a) NEWS RELEASE - ------AT THE COMPANY------ -------FLEISHMAN HILLARD-------- Lynn Afendoulis Jeremy Skule Director of Public Affairs Vice President 616/364-6161 212/453-2245 FOR IMMEDIATE RELEASE MONDAY, JULY 12, 2004 UNIVERSAL POSTS STRONG GROWTH IN THE SECOND QUARTER OF 2004; NET EARNINGS INCREASE 15% GRAND RAPIDS, MI., July 12, 2004 -- Universal Forest Products (Nasdaq: UFPI) today announced strong second quarter results with a 34.4% increase in net sales to $742.6 million, up from $552.5 million reported for the same period last year. Net sales for the first six months of 2004 were $1.2 billion, a 33.1% increase over net sales of $908.1 million for the same period of 2003. Net earnings for the quarter were $19.8 million, a 15.1% increase over net earnings of $17.2 million for the same period in 2003. Net earnings for the year to date were $25.3 million, a 16.9% increase over 2003 year-to-date net earnings of $21.7 million. By market, Universal posted second quarter net sales of: o $344.6 million in D-I-Y/retail, up 14.0% over the same quarter last year; o $170.3 million in site-built construction, an increase of 68.2% over last year; o $124.3 million in industrial, up 56.2% over last year, and o $103.4 million in manufactured housing, a 48.9% increase over last year. "I'm continually proud of our performance and of the hard work of our people," said CEO William G. Currie. "We controlled what we could and delivered very strong results, especially in our site-built and industrial markets." A few significant factors contributed to the company's performance. Total unit sales increased more than 11% for the quarter thanks to strong unit sales to the site-built, industrial and manufactured housing markets. A decline in units sold to the Do-It-Yourself retail market is attributed to record precipitation in many areas of the country -- notably the Midwest, Texas, and portions of the East -- that forced homeowners to delay home improvement projects. "This showcases the power of our balanced business model and geographic diversity, which allow us to thrive even when one of our markets faces a challenge," Currie explained. MORE...
UNIVERSAL FOREST PRODUCTS, INC. PAGE 2 The remaining 23% of the company's 34.4% increase in net sales is attributable to the lumber market, which was higher during the second quarter of 2004. Gross profit increased 17.9% for the quarter, exceeding the Company's unit sales increase due, in part, to the impact of the rising lumber market in April and May on products whose selling prices are tied to the lumber market. Other factors affecting the quarter's results included: o A fire in April that destroyed a truss plant in Thorndale, Ontario at the start of the building season. Although Universal maintained its service to customers by moving the work to other plants in the U.S., transportation costs and operating inefficiencies resulted in greater costs to the company. Management currently estimates that the insured value of the property destroyed will exceed its net book value. o The opening of several new plants this year. As anticipated, the plants were in a start-up phase and were not profitable during their first months of operation. o The company continues to bring its multi-family framing operations in the West up to Universal's management standards and profitability targets. "This is a new area of business for us and, as we stated previously, we've experienced some challenges. We believe the changes we've made eventually will lead us to improved profitability," Currie said. OUTLOOK The Company currently anticipates continued growth in its business in 2004 and reaffirms its targets for both unit sales and diluted earnings per share growth of 10% to 14% for the year. Universal Forest Products will conduct a conference call to discuss information included in this news release and related matters at 11:00 a.m. EDT on Tuesday, July 13, 2004. The conference call will be hosted by William G. Currie and will be available for analysts and institutional investors domestically at (888) 792-1079 or internationally at (703) 871-3092. Use conference call ID #507398. The conference call will be available simultaneously, and in its entirety, to all interested investors and news media through a webcast at www.ufpi.com. Universal Forest Products markets, manufactures, and engineers wood and wood-alternative 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. Among the company's newest and fastest-growing ventures are framing and installation services for the site-built and retail sectors. In conjunction with its customers, Universal uses its engineering and manufacturing expertise, coupled with highly skilled employees, to design and construct buildings and decks. For information about Universal Forest Products on the Internet, please visit the Company's web site at www.ufpi.com, or call 888-Buy-UFPI. MORE...
UNIVERSAL FOREST PRODUCTS, INC. PAGE 3 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. Among the factors that could cause actual results to differ materially are the following: Adverse lumber market trends, competitive activity, negative economic trends, government regulations, and weather. 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. HIGHLIGHTS TO FOLLOW
UNIVERSAL FOREST PRODUCTS, INC. CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) FOR THE SIX MONTHS ENDED JUNE 2004/2003 QUARTER PERIOD YEAR TO DATE -------------------------------------- ----------------------------------------------- (In thousands, except per share data) 2004 2003 2004 2003 -------- ------- -------- -------- NET SALES $ 742,568 100% $552,463 100% $ 1,208,233 100% $ 908,082 100% COST OF GOODS SOLD 649,747 87.50 473,721 85.75 1,059,051 87.65 777,536 85.62 -------- ------- -------- -------- GROSS PROFIT 92,821 12.50 78,742 14.25 149,182 12.35 130,546 14.38 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 56,082 7.55 46,697 8.45 100,011 8.28 86,885 9.57 -------- ------- -------- -------- EARNINGS FROM OPERATIONS 36,739 4.95 32,045 5.80 49,171 4.07 43,661 4.81 OTHER EXPENSE (INCOME) INTEREST EXPENSE 3,869 0.52 3,958 0.72 7,411 0.61 7,745 0.85 INTEREST REVENUE (102) -0.01 (84) -0.02 (185) -0.02 (131) -0.01 GAIN ON SALE OF REAL ESTATE AND INTEREST IN SUBSIDIARY (575) -0.08 -- 0.00 (944) -0.08 -- 0.00 -------- ------- -------- -------- 3,192 0.43 3,874 0.70 6,282 0.52 7,614 0.84 -------- ------- -------- -------- EARNINGS BEFORE INCOME TAXES AND MINORITY INTEREST 33,547 4.52 28,171 5.10 42,889 3.55 36,047 3.97 INCOME TAXES(1) 12,645 1.70 10,458 1.89 16,289 1.35 13,249 1.46 -------- ------- -------- -------- EARNINGS BEFORE MINORITY INTEREST 20,902 2.81 17,713 3.21 26,600 2.20 22,798 2.51 MINORITY INTEREST (1,146) -0.15 (551) -0.10 (1,277) -0.11 (1,136) -0.13 -------- ------- -------- -------- NET EARNINGS $ 19,756 2.66 $ 17,162 3.11 $ 25,323 2.10 $ 21,662 2.39 ======== ======= ======== ======== EARNINGS PER SHARE - BASIC $ 1.09 $ 0.97 $ 1.41 $ 1.22 EARNINGS PER SHARE - DILUTED $ 1.06 $ 0.94 $ 1.35 $ 1.19 WEIGHTED AVERAGE SHARES OUTSTANDING 18,050 17,741 17,994 17,735 WEIGHTED AVERAGE SHARES OUTSTANDING WITH COMMON STOCK EQUIVALENTS 18,702 18,193 18,694 18,222 SUPPLEMENTAL SALES DATA - ----------------------- QUARTER PERIOD YEAR TO DATE -------------------------------------- ----------------------------------------------- MARKET CLASSIFICATION 2004 % 2003 % 2004 % 2003 % - --------------------- ----- - ----- - ----- - ----- - DO-IT-YOURSELF/RETAIL $ 344,582 46% $302,224 55% $ 523,491 43% $ 458,510 50% SITE-BUILT CONSTRUCTION 170,325 23% 101,242 18% 285,163 24% 178,237 20% MANUFACTURED HOUSING 103,403 14% 69,453 13% 180,370 15% 126,465 14% INDUSTRIAL AND OTHER 124,258 17% 79,544 14% 219,209 18% 144,870 16% --------- --- -------- --- ----------- --- --------- --- TOTAL $ 742,568 100% $552,463 100% $ 1,208,233 100% $ 908,082 100%
UNIVERSAL FOREST PRODUCTS, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) JUNE 2004/2003 (IN THOUSANDS) - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES AND ASSETS 2004 2003 SHAREHOLDERS'EQUITY 2004 2003 - ------------------------------------------------------------------------------------------------------------------------------------ CURRENT ASSETS CURRENT LIABILITIES Cash and cash equivalents $ 25,080 $ 20,574 Notes payable $ -- $ 1,679 Accounts receivable 246,850 200,033 Accounts payable and Inventories 227,455 166,742 accrued liabilities 206,156 162,402 Other current assets 11,809 5,424 Current portion of long-term debt and capital leases 498 6,271 --------------- ---------- TOTAL CURRENT ASSETS 511,194 392,773 -------------- ---------- TOTAL CURRENT LIABILITIES 206,654 170,352 OTHER ASSETS 6,974 6,401 INTANGIBLE ASSETS, NET 132,748 131,858 LONG-TERM DEBT AND CAPITAL LEASES, LESS CURRENT PORTION 287,387 255,975 PROPERTY, PLANT OTHER LIABILITIES 33,317 29,819 AND EQUIPMENT, NET 208,142 211,277 --------------- ---------- SHAREHOLDERS' EQUITY 331,700 286,163 -------------- ---------- TOTAL LIABILITIES AND TOTAL ASSETS $ 859,058 $ 742,309 SHAREHOLDERS' EQUITY $ 859,058 $ 742,309 =============== ========== =============== ==========
UNIVERSAL FOREST PRODUCTS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE SIX MONTHS ENDED JUNE 2004/2003 - ------------------------------------------------------------------------------------------------------------------------------------ (IN THOUSANDS) 2004 2003 - ------------------------------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $ 25,323 $ 21,662 Adjustments to reconcile net earnings to net cash from operating activities: Depreciation 13,408 12,202 Amortization of intangibles 940 1,033 Deferred income taxes 366 (1,438) Minority interest 1,277 1,136 Loss on sale of interest in subsidiary 193 -- (Gain) Loss on sale or impairment of property, plant and equipment (730) 640 Changes in: Accounts receivable (112,052) (94,237) Inventories (56,963) (736) Accounts payable 54,711 52,039 Accrued liabilities and other 20,714 10,974 --------- --------- NET CASH FROM OPERATING ACTIVITIES (52,813) 3,275 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant, and equipment (16,607) (20,689) Purchase of licensing agreements -- (150) Acquisitions, net of cash received (10,075) (187) Sale of interest in subsidiary 4,679 -- Proceeds from sale of property, plant and equipment 3,287 1,147 Other 1,678 1,961 --------- --------- NET CASH FROM INVESTING ACTIVITIES (17,038) (17,918) CASH FLOWS FROM FINANCING ACTIVITIES: Net (repayments) borrowings under revolving credit facilities and notes payable 83,062 26,437 Repayment of long-term debt (6,117) (6,167) Proceeds from issuance of common stock 1,828 873 Distributions to minority shareholder (125) (633) Dividends paid to shareholders (897) (798) Repurchase of common stock (129) (2,029) Other (121) -- --------- --------- NET CASH FROM FINANCING ACTIVITIES 77,501 17,683 --------- --------- NET CHANGE IN CASH AND CASH EQUIVALENTS 7,650 3,040 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 17,430 17,534 --------- --------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 25,080 $ 20,574 ========= ========= - 30 -