Earnings rise at Texas Industries
Mel Brekhus, CEO for the building products company, said results improved for the company’s consumer products segments as well as its other commercial divisions. Favorable weather conditions and improved margins helped boost earnings, he said.
“In fact, operating profit for the aggregate segment during the first nine months of the current fiscal year has increased by 35 percent compared to the same period last year and operating profit for the consumer products segment has increased by 80 percent,” Brekhus said. Shipments of ready-mix concrete rose 16 percent in the quarter, the company said in a statement.
So why such positive results while many building materials providers are feeling the effects of a lagging housing market? One primary reason could be that Texas Industries operations are centered in Texas, and “the Texas economy continues to generate a solid overall level of construction activity,” the company said in a statement. Additionally, the company said while in California demand has declined, imports also have declined and prices have increased in both markets.
The company is currently expanding its manufacturing capacity in California, with a new cmeent plant slated to open in June 2008. An expansion project in Central Texas and a newly opened plant in North Texas also have contributed to company’s expansion efforts.
Lennar posts $88.2 million loss in first quarter
Lennar, the Miami-based national home builder, reported a net loss of $88.2 million for its first quarter, which ended on Feb. 29, 2008. This compares to earnings of $68.6 million for the same period in 2007.
Revenues from home sales decreased 64 percent to $953.1 million in the first quarter from $2.6 billion a year ago. There was a 60 percent decrease in the number of deliveries in the quarter and an 8 percent decrease in the average sale price of homes.
Market conditions continued to deteriorate throughout the first quarter of 2008, according to Stuart Miller, Lennar’s president and CEO.
“Home inventories have been expanding due to the high number of foreclosures, negotiated ‘short sales’ and stretched homeowners looking to sell homes they can no longer afford,” Miller said in a prepared statement. “While sales are occurring and clearing prices are being reached, the pace of overall housing inventory growth is exceeding absorption at the current time.”
Sears names new key executives
As part of an ongoing restructuring effort, Sears Holdings has named two new key executives of divisions within its home improvement business.
John Froman, formerly CEO of Namco, a regional chain of large-sized family recreation specialty stores, will serve as head of Sears’ tools and lawn and garden divisions. Prior to his time at Namco, Froman served 19 years at Circuit City Stores, most recently as executive vp and chief operating officer.
“John’s wealth of retail experience and demonstrated success in retail operations, merchandising and strategic planning will help us operate the tools and lawn and garden businesses more efficiently and effectively,” said Bruce Johnson, interim CEO and president of Sears Holdings.
Sears also announced the promotion of Douglas Moore to the position of senior vp and president, appliances. Moore was hired as senior vp-hardlines merchandising at Sears Holdings in June 2007. He spent 17 years at Circuit City Stores, most recently as executive vp and chief merchandising officer. He also served in senior leadership positions within sales, operations and installation at Circuit City.
The new appointments are part of a bid, announced Jan. 24, to reorganize Sears Holdings into separate and more autonomous business units, following weak sales performances and lagging earnings.