Post-Pandemic, Companies Report Financial Highs and Lows; Forecast Stronger 2022

As the economy and construction continue to make their way back to pre-pandemic conditions, some companies are starting to see improvements in their financial results.

Quanex Building Products

In announcing its results for the three months ended April 30, 2021, Quanex posted net sales growth of 34.6% in its North American Fenestration segment and 92.1% in its European Fenestration segment, excluding the foreign exchange impact. The company attributes the net sales growth during those three months to the increased demand for products across all product lines and operating segments, coupled with increased pricing mostly related to raw material cost inflation. However, both of the company’s manufacturing facilities in the U.K. were shut down in late March of 2020 and did not resume operations until mid-to-late May last year.

The company statement indicates that the increase in earnings for the second quarter of 2021 was mostly due to higher volumes and improved operating leverage, though the increase in earnings was offset by inflationary pressures and an increase in selling, general and administrative expenses—largely attributable to more normalized medical costs combined with an increase in stock-based compensation expense that resulted from the shareholder value created by the further appreciation of Quanex’s stock price during the period.

Tecnoglass

Tecnoglass Inc., a supplier of architectural glass, windows and associated aluminum products located in Barranquilla, Colombia, also reported positive financial results for its first quarter of 2021. Total revenues for the first quarter of 2021 increased 27.0% to $110.9 million, compared to $87.3 million in the prior year quarter. U.S. revenues of $100.8 million, which represented 91% of total revenues, grew 27.9% compared to $78.8 million in the prior year quarter, driven by strong growth in residential activity, recovering commercial construction activity, and market share gains. Colombia revenue, a majority of which is represented by long-term contracts priced in Colombian pesos but indexed to the U.S. dollar, was $7.7 million, an increase of 18.4% compared to $6.5 million in the prior year quarter. Changes in foreign currency exchange rates had a negligible impact on Colombia and total revenues in the quarter.

Gross profit for the first quarter of 2021 grew 48.4% to $45.1 million, representing a 40.7% gross margin, compared to gross profit of $30.4 million, representing a 34.9% gross margin in the prior year quarter. The 590 basis point improvement in gross margin mainly reflected a higher mix of revenue from manufacturing versus installation activity as Tecnoglass increased its mix of single family residential products, and included a full quarter of greater operating efficiencies from prior automation initiatives. Selling, general and administrative expense (SG&A) was $19.8 million compared to $17.3 million in the prior year quarter, primarily attributable to higher variable expenses related to ground and marine transportation. As a percent of total revenues, SG&A was 17.8% compared to 19.8% in the prior year quarter, primarily due to higher sales and better operating leverage on personnel, professional fees and other fixed expenses.

NSG Group

Not all companies, however, reported increases. NSG Group, the global glass manufacturer and parent company of Pilkington, saw a decline in revenues in fiscal year 2021 compared to 2020, yet still exceeded its expectations, according to the financial report.

The company totaled $4.57 billion for the year, down 10.2% from $5.09 billion the year before but greater than its previous forecast of $4.49 billion. According to the report, the year-over-year decline was due to a “dramatic decrease in demand in the first quarter.”

NSG’s sales in architectural glass were down 7.8% for the year, with the Americas region recording a 3.8% decrease.

“Architectural full-year revenues and profits fell from the previous year, as the businesses were affected by lower demand caused by the COVID-19 pandemic. However, revenues and profits for the fourth quarter showed a year-on-year improvement,” according to the report.

“… In North America, volumes of glass for domestic commercial buildings were sluggish.”

NSG forecasts a 6.2% increase in fiscal year 2022. “Revenues are planned to increase reflecting the overall stable market environment,” the company reports.

View Inc. Reports First Quarter 2021 Financial Results

Silicon Valley-based smart window company View Inc. has announced its financial results for the first quarter 2021.

“In the first quarter of 2021, we saw continued increase in market adoption of our products. We are also experiencing an increase in activity as our customers start preparing to return to a more normal course of business later this year,” says Dr. Rao Mulpuri, chairperson and CEO. “We are proud of our accomplishments to date, and we are excited to start our journey as a public company. We continue to invest in technology to transform the real estate industry in order to improve the user experience, drive the world’s
sustainability goals, improve human health, and create tech enabled spaces. We are especially excited about the strong customer reception to our new products released in Q1 2021.”

The company’s recently announced new products are being deployed and began generating revenue in Q1 2021. These new products include View Net, View Sense and View Immersive Experience.

According to its financial statement, the company saw an improvement from the fourth quarter of 2020 due to production efficiencies. Given the results of the first quarter of 2021, View expects revenues for full year 2021 to be in the range of $70 to $80 million.

Additionally, the company completed its initial public offering, raising gross proceeds of $815.2 million and is now trading on the NASDAQ under the ticker “VIEW.”

Highlights from View’s 2021 First Quarter Results

• Generally Accepted Accounting Principles (GAAP) revenue of $11.8 million, a 29% increase from Q1 2020 and a 52% increase from Q4 2020.
• GAAP cost of revenue of $29.9 million, a 16% improvement from Q1 2020 and a 5% improvement from Q4 2020 due to production efficiencies.
• GAAP operating expenses of $37.1 million, a 16% improvement from Q1 2020, and a 10% increase over Q4 2020 related to growth initiatives and IPO preparations.
• GAAP loss from operations of ($55.1) million, a 22% improvement compared to Q1 2020 and 4% improvement from Q4 2020.

To view the laid-in version of this article in our digital edition, CLICK HERE.