Masco Corp. has reported net sales of $1.976 billion for its third fiscal quarter, which were flat compared with sales of $1.978 billion in the third quarter a year ago. North American sales increased 4% and international sales decreased 12%. In local currencies, international sales decreased 3% compared with the third quarter of 2011.
Net income reported for the third quarter, which ended Sept. 30, was $15 million, compared with $36 million during the corresponding quarter last year.
Installation and paint were strong performers in the quarter, posting 9% and 6% in revenue growth, respectively. Sales of plumbing products slipped 4%, and the cabinet division posted a 5% decline in sales.
“Our top line in the third quarter benefited from the increase in new home construction activity in North America, new product introductions, and from selling price increases,” said Masco’s CEO, Tim Wadhams. “These positives offset both the slow economic growth in North America and the continued weakening of Euro-Zone economies that we anticipated for the second half of 2012.
“We continue to make progress on our strategic initiatives, which include leveraging our brands, reducing our costs, improving our Installation and cabinet segments and strengthening our balance sheet,” Wadhams continued. “We are encouraged by the continued strength in new home construction activity, driven by the stabilization and improvement of home prices in many areas of the U.S., increasing affordability and demographic trends. These factors should continue to drive demand for new homes over the next several years. Increased new home construction activity benefits virtually all of our businesses, particularly our installation segment which has improved significantly this year, almost breaking even in the third quarter and which we expect to be profitable in the fourth quarter.
“In our cabinet segment, we announced actions during the quarter, including the closure of a manufacturing location and a headcount reduction, which we expect will improve our efficiency and reduce costs by approximately $20 million on an annual basis. While we are committed to returning our cabinet segment to profitability, we anticipate that big ticket remodeling will remain weak, even though we continue to see modest improvement in overall repair and remodeling activity.”