Quanex Building Products Corp. announced its results for the three months ended January 31, 2022.

The company reported net sales of $267 million during the period, which represents year-over-year growth of 16%. The increase was attributable primarily to volume increases in the fenestration segments combined with higher prices related to the pass-through of raw material cost inflation. Quanex saw 14.5% net sales growth in its North American fenestration segment and 18.6% in its European fenestration segment, excluding the foreign exchange impact.

Quanex attributes the increase in earnings for this time to continued strong demand, operational efficiency gains and increased pricing; however, a decrease in margin percentage was driven by inflationary pressures and supply chain challenges. 

“Demand remains healthy, but the rate of inflation continues to cause pressure on margins,” says George Wilson, president and CEO. “However, based on our improvements in labor performance, the expected continuation of our pass-through pricing strategy, conversations with our customers, and the latest macro data, we are now comfortable providing guidance for fiscal 2022, which points to another record year of revenue and earnings. We expect high-single-digit revenue growth in our North American fenestration segment, low to mid-single-digit revenue growth in our North American cabinet components segment and mid-single-digit revenue growth in our European fenestration segment.”

He continues to say the company is pleased with the results for the first quarter of 2022, especially considering recent inflation and supply chain challenges. According to the release, demand was healthy during the quarter, and Quanex reported solid revenue growth.

“The rate of inflation is currently our biggest challenge, but we expect inflationary pressures to subside in the second half of the year, which should allow for margin expansion at that time … As is typical, we were a net borrower during the first quarter, but our balance sheet and liquidity remain strong. We are well-positioned and have the flexibility to consider multiple options as we continue to navigate the path towards creating value for shareholders,” Wilson concludes.

 

News