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

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)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12).

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)).

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)).

 

 

Item 2.02 Results of Operations and Financial Condition

On July 17, 2006, the Registrant issued a press release announcing its financial results for the quarter ended July 1, 2006. A copy of the Registrant’s press release is attached as Exhibit 99(a) to this Current Report.

Item 9.01 Financial Statements, Pro Forma Financial Information, and Exhibits

	(c)		Exhibits
	99(a) Press Release dated July 17, 2006.

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 18, 2006		By:		/s/ Michael R. Cole   Michael R. Cole, Chief Financial Officer and Treasurer

Exhibit Index

Exhibit Number		Description
99(a)		Press Release dated July 17, 2006.

Exhibit 99(a)

news release

--------------AT THE COMPANY--------------
Lynn Afendoulis
Director, Corporate Communications
616/365-1502

FOR IMMEDIATE RELEASE
MONDAY, JULY 17, 2006

Universal Forest Products Posts 20% Increase in 2^nd Quarter Net Earnings
Year-to-Date Earnings up 35%

GRAND RAPIDS, Mich., July 17, 2006 — Universal Forest Products (Nasdaq: UFPI) today announced a strong second quarter marked by net earnings of $27.3 million, an increase of 19.9% over the same period last year. Year-to-date net earnings were $43.2 million, a 34.9% increase over the first six months of 2005.

Net sales for the quarter were $826.8 million, up 6.1% over net sales of $779.6 million for the second quarter of 2005. Net sales for the first six months of 2006 were $1.49 billion, up 13.3% over net sales of $1.32 billion for the same period in 2005.

“Our strengths for the quarter included continued market share gains in the site-built construction and industrial markets where we again saw double-digit unit growth,” said CEO Michael B. Glenn.

Sales were adversely impacted by the lumber market, with prices down approximately 14% from the prior year quarter. The increase in earnings was driven by a combination of increased sales of value-added products and a continued focus on innovations and cost reductions. Value-added products made up 56% of total sales for the quarter, up from 50% for the same period last year.

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Universal Forest Products, Inc.
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“We’re continuing our strategy of focusing on sales of value-added products by growing our market share in site-built construction and industrial, as well as introducing products through our new division, Universal Consumer Products,” Glenn said.

By market, Universal posted second-quarter sales of:

	•		$349.5 million in D-I-Y/retail, up 1.4% compared to the same quarter last year;
	•		$227.8 million in site-built construction, an increase of 22.1% over the same quarter last year;
	•		$149.4 million in industrial, up 6.4% over the second quarter 2005; and
	•		$100.1 million in manufactured housing, a 7.2% decrease from the second quarter of 2005, which reflected a significant decline in lumber prices in 2006 of species relevant to this market.

OUTLOOK

The Company reaffirms its annual target for net earnings growth of 15% to 20% and its unit sales target of 10% to 15% growth in 2006 based upon the following assumptions:

	•		Stable housing markets where we have a strong site-built presence and continued opportunities for market share gains.
	•		Stability in our D-I-Y/retail and manufacturing housing markets, as well as in lumber prices.
	•		Favorable weather conditions for building and home improvement activities, particularly in the fourth quarter.
	•		Continuing to gain market share and realize strong unit sales growth in the industrial market.
	•		The completion of strategic business acquisitions.

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 18, 2006. The conference call will be hosted by CEO Michael B. Glenn and Executive Chairman William G. Currie and will be available for analysts and institutional investors domestically at (866) 383-8008 or internationally at (617) 597-5341. Use conference call ID #73805629.

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 Wednesday, August 16, 2006 domestically at (888) 286-8010 or internationally at (617) 801-6888. Use replay ID # 22096875.

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Universal Forest Products, Inc.
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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. The Company also provides framing services for the site-built sector. The Company reported sales of nearly $2.7 billion in 2005. Universal has approximately 10,000 employees who work out of more than 100 locations. For information about Universal Forest Products, please visit the Company’s Web site at http://www.ufpi.com, or call 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. 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

CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
FOR THE SIX MONTHS ENDED
JUNE 2006/2005

		Quarter Period																Year to Date
(In thousands, except per share data)		2006								2005								2006								2005
NET SALES		$	826,847				100	%		$	779,552				100	%		$	1,492,456				100	%		$	1,316,712				100	%
COST OF GOODS SOLD			706,429				85.44				678,310				87.01				1,277,727				85.61				1,148,241				87.21
GROSS PROFIT			120,418				14.56				101,242				12.99				214,729				14.39				168,471				12.79
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES			70,773				8.56				59,505				7.63				135,302				9.07				109,356				8.31
EARNINGS FROM OPERATIONS			49,645				6.00				41,737				5.35				79,427				5.32				59,115				4.49
OTHER EXPENSE (INCOME)
Interest expense			3,744				0.45				4,266				0.55				7,543				0.51				8,041				0.61
Interest income			(352	)			-0.04				(270	)			-0.03				(781	)			-0.05				(419	)			-0.03
Net (gain) loss on sale of real estate and interest in subsidiary			(63	)			-0.01				32				0.00				(63	)			0.00				(1,240	)			-0.09
			3,329				0.40				4,028				0.52				6,699				0.45				6,382				0.48
EARNINGS BEFORE INCOME TAXES AND MINORITY INTEREST			46,316				5.60				37,709				4.84				72,728				4.87				52,733				4.00
INCOME TAXES			17,885				2.16				14,237				1.83				27,641				1.85				19,996				1.52
EARNINGS BEFORE MINORITY INTEREST			28,431				3.44				23,472				3.01				45,087				3.02				32,737				2.49
MINORITY INTEREST			(1,117	)			-0.14				(682	)			-0.09				(1,907	)			-0.13				(718	)			-0.05
NET EARNINGS		$	27,314				3.30			$	22,790				2.92			$	43,180				2.89			$	32,019				2.43
EARNINGS PER SHARE — BASIC		$	1.45							$	1.24							$	2.31							$	1.75
EARNINGS PER SHARE — DILUTED		$	1.41							$	1.20							$	2.23							$	1.69
WEIGHTED AVERAGE SHARES OUTSTANDING			18,851								18,323								18,729								18,255
WEIGHTED AVERAGE SHARES OUTSTANDING WITH COMMON STOCK EQUIVALENTS			19,432								18,984								19,355								18,978

SUPPLEMENTAL SALES DATA

		Quarter Period																Year to Date
Market Classification		2006				%				2005				%				2006				%				2005				%
Do-It-Yourself/Retail		$	349,519				42	%		$	344,624				44	%		$	562,511				38	%		$	522,733				40	%
Site-Built Construction			227,830				28	%			186,626				24	%			437,588				29	%			337,549				26	%
Manufactured Housing			100,134				12	%			107,925				14	%			205,254				14	%			203,371				15	%
Industrial			149,364				18	%			140,377				18	%			287,103				19	%			253,059				19	%
Total		$	826,847				100	%		$	779,552				100	%		$	1,492,456				100	%		$	1,316,712				100	%

UNIVERSAL FOREST PRODUCTS, INC.
PAGE 5

CONSOLIDATED BALANCE SHEETS (UNAUDITED)
JUNE 2006/2005

(In thousands)		2006				2005
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	43,309			$	27,586
Accounts receivable			242,829				232,600
Inventories			246,810				247,829
Other current assets			22,495				13,114
TOTAL CURRENT ASSETS			555,443				521,129
OTHER ASSETS			8,003				8,056
INTANGIBLE ASSETS, NET			147,901				134,373
PROPERTY, PLANT AND EQUIPMENT, NET			227,995				222,304
TOTAL ASSETS		$	939,342			$	885,862

				2006				2005
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities				$	247,524			$	229,835
Current portion of long-term debt and capital leases					902				21,937
TOTAL CURRENT LIABILITIES					248,426				251,772
LONG-TERM DEBT AND CAPITAL LEASES, less current portion					170,192				206,000
OTHER LIABILITIES					33,050				36,717
SHAREHOLDERS’ EQUITY					487,674				391,373
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY				$	939,342			$	885,862

UNIVERSAL FOREST PRODUCTS, INC.
PAGE 6

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED
JUNE 2006/2005

(In thousands)		2006				2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings		$	43,180			$	32,019
Adjustments to reconcile net earnings to net cash from operating activities:
Depreciation			16,730				15,200
Amortization of intangibles			2,151				1,190
Expense associated with share-based compensation arrangements			522				—
Expense associated with stock grant plans			177				133
Deferred income taxes			(867	)			(516	)
Minority interest			1,907				718
Loss (gain) on sale or impairment of property, plant and equipment			(183	)			(1,133	)
Changes in:
Accounts receivable			(57,246	)			(80,206	)
Inventories			7,768				(31,838	)
Accounts payable			39,426				50,881
Accrued liabilities and other			8,237				17,131
Excess tax benefits from share-based compensation arrangements			(3,866	)			—
NET CASH FROM OPERATING ACTIVITIES			57,936				3,579
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment			(16,234	)			(21,985	)
Acquisitions, net of cash received			(11,298	)			(7,500	)
Proceeds from sale of property, plant and equipment			565				2,318
Collection of notes receivable			1,600				323
Advances on notes receivable			(2,473	)			—
Insurance proceeds			38				3,013
Other, net			—				135
NET CASH FROM INVESTING ACTIVITIES			(27,802	)			(23,696	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net (repayments) borrowings under revolving credit facilities			(40,000	)			21,140
Repayment of long-term debt			(325	)			(454	)
Proceeds from issuance of common stock			5,389				2,865
Distributions to minority shareholder			(930	)			(369	)
Dividends paid to shareholders			(1,035	)			(910	)
Excess tax benefits from share-based compensation arrangements			3,866				—
Other, net			(5	)			157
NET CASH FROM FINANCING ACTIVITIES			(33,040	)			22,429
NET CHANGE IN CASH AND CASH EQUIVALENTS			(2,906	)			2,312
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			46,215				25,274
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	43,309			$	27,586