Quanex’ third-quarter results for the period ended 31 July 2013 show a consolidated net income of USD 5 million and an improved operating income. According to the company, global EPG sales for the 12 months ended 31 July 2013 were up 11.2%.
Quanex Building Products Corp. has released fiscal 2013 third-quarter results for the period ended 31 July 2013. The company reports a consolidated net income of USD 5 million and an improved operating income of USD 18.6 million.
According to the company, consolidated third-quarter 2013 net sales increased 8.9% to USD 259.2 million, compared to USD 237.9 million a year ago. Third-quarter 2013 net income was USD 5.0 million, or USD 0.13 per diluted share compared to net income of USD 1.5 million, or USD 0.04 per diluted share in the year ago quarter.
Additionally, consolidated third-quarter EBITDA, a non-GAAP measure, was USD 19.3 million, compared to USD 10.6 million a year ago. Consolidated year-to-date EBITDA, a non-GAAP measure, was USD 17.4 million, compared to USD 2.5 million a year ago.
Year-to-date consolidated 2013 net sales were USD 677.3 million, compared to USD 593.9 million a year ago, and year-to-date consolidated net loss was USD 10.5 million compared to a loss of USD 17.5 million a year ago.
The company says that 2013 year-to-date results, when measured against comparable prior year periods, benefitted from the inclusion of sales related to the Aluminite acquisition completed in December 2012 and the elimination of 2012 strike-related costs at Nichols Aluminum. Adjusting for these items, third-quarter and year-to-date results improved as a result of higher sales across all divisions under the Engineered Products Group (EPG) segment and cost savings associated with the company’s insulating glass systems facility consolidation that occurred in 2012.This was partially offset by higher information technology and Enterprise Resource Planning (ERP) implementation costs.
On 29 August 2013, the board of directors declared a quarterly cash dividend of USD 0.04 per share on the company’s common stock, payable 30 September 2013, to shareholders of record on 16 September 2013.
According to Quanex, global EPG sales for the 12 months ended 31 July 2013 were up 11.2%. EPG’s North American domestic fenestration sales, the most comparable sales figure to those reported by Ducker, increased 11.5% (3.4% excluding Aluminite) from the previous 12 months.
Preliminary US window shipments as reported by Ducker increased 10.1% over the 12 months ended 30 June 2013, driven by a 27.6% increase in new construction units. US window shipments to the residential R&R market as reported by Ducker increased 1.3% for the 12-month period ended June 30, 2013. A greater portion of EPG’s sales are tied to R&R versus new construction.
EPG sales results continue to be negatively impacted by lower vinyl pricing, higher industry sales of lower performance windows typically installed in new construction and continued weak R&R sales.
Corporate expenses in the quarter were USD 11.0 million compared to USD 8.4 million in the year ago quarter primarily due to higher ERP expenses of USD 2.0 million, (including USD 1.7 million of higher depreciation) and USD 1.1 million in higher IT-related costs, partially offset by USD 0.6 million in lower stock-based compensation costs.
In August 2013, following a management recommendation, the company’s board of directors voted to cease the implementation of the ERP project. The proposal was made based on management’s belief that investments made in initiatives that will drive greater revenue growth and profitability will have more impact on increasing shareholder value than continuing to invest in the ERP system.
The company reports total cash of USD 16.1 million with no outstanding borrowings against the revolving credit facility. Cash provided by operating activities for the first nine months of 2013 was USD 6.6 million and available capacity under the company’s revolving credit facility was approximately USD 82.5 million.