Quanex Building Products’ fourth-quarter financial results, released yesterday, include a $1.2 million net loss, compared with a net income of $1.0 million for the same period in 2012. However, the company saw a 17-percent increase in its net sales from $235 million to $275 million, when compared with the fourth quarter of 2012.
“Results were favorably impacted by an improvement in the housing market, coupled with savings generated from last year’s insulating glass facility consolidation and the addition of Aluminite earlier in 2013,” says CEO Bill Griffiths. “Corporate results were negatively impacted as we recognized $15 million of accelerated depreciation from the cessation of our ERP implementation.”
The Engineered Products Group (EPG), which includes Edgetech IG, reported fourth-quarter 2013 net sales of $167 million, an increase of 22 percent (10 percent excluding Aluminite’s sales), compared to $136 million in the fourth quarter of 2012. Fourth-quarter 2013 operating income was $18 million compared to $14 million in the fourth quarter of 2012. The EPG’s fourth-quarter 2013 EBITDA was $26 million compared to $21 million in the fourth quarter of 2012. Company officials say the EPG’s results “continue to be impacted by higher industry sales of lower-performance windows typically installed in new construction and continued weak residential remodeling and replacement (R&R) sales.”
“The key indicators that impact our markets are encouraging,” Griffiths adds. ”New housing starts have improved, home prices are increasing and consumers are beginning to invest in R&R. Much of the recovery in new construction is weighted more toward entry-level windows; and, consumers are investing R&R dollars in items such as paint, cabinets and appliances, but not yet into windows. Prime window demand for the R&R market, which has been flat for the past several years, will remain challenging and we believe a measurable recovery is likely 12 to 18 months away, as low energy costs and tough financing conditions discourage homeowners from replacing windows.”