Plum Creek’s revenues drop 6.8%
Plum Creek Timber Company experienced a slow-down in sales during the first quarter of 2014, though a corresponding drop in income was largely expected due to to a timberland sale.
Net revenue for the three months ended March 31 was $317 million, down from $340 million in the same period last year.
Net income for the quarter was $30 million, down 46.4% since the first quarter of 2013.
Despite the weak performance, CEO Rick Holley said he was pleased with the company’s performance last quarter.
“Results from our timber resources segment continue to grow with higher log prices and additional harvest volumes from our recently acquired timberlands," said Holley. "Earnings were in line with our initial expectations despite difficult weather conditions that hampered both log deliveries in the South and production and shipments from our Manufacturing facilities. As expected, first quarter’s income was lower than last year. This was solely the result of a large non-strategic timberland sale that contributed 21 cents to earnings per share in the first quarter of 2013."
Holley added that the timberlands and other assets acquired from MeadWestvaco last December have been integrated into the company’s portfolio, contributing $4 million in operating income and $9 million to adjusted EBITDA last quarter.
The company said it was on track to reach its goal of growing its non-real estate adjusted EBITDA by more than $80 million this year.
At Stock, remodeling boosts revenues
Raleigh, N.C.-based Stock Building Supply posted double-digit sales gains in the first quarter, as the company’s loss narrowed.
Net sales were up 12.6% to $280 million, compared with $248.7 million in last year’s first quarter. The company’s net loss of $3.3 million compared with a net loss of $4.1 million in the same period last year.
Stock’s sales growth was heavy on repair and remodeling, which accounted for sales gains of 17.3%. Sales to single-family home builders increased 9.0%.
Stock operates 69 facilities in 14 states.
President and CEO Jeff Rea analyzed the numbers: "Our continued success in growing revenue is a direct reflection of our flexible business model and ability to withstand a challenging operating environment during the first quarter in which construction activity was slowed by harsh winter weather and U.S. single-family housing starts declined by approximately 1.7% as compared with the prior year. In spite of this slow down, we continued to drive improvements in our operating results while also making important investments in the business. This included additional resources to expand product and service offerings and deepen customer relationships in our local markets."
The company said it increased gross profit to over 21% and expanded gross margins 170 basis points compared with the prior-year period. Meanwhile, Stock pointed to investments in its distribution capacity, its stores and new technology.
Rea looks ahead to the rest of the year with optimism. "Although our year-to-date revenue growth has been hampered by a delayed start to the home-builder spring selling season, we expect our primary end-use markets will continue their recovery from current levels," he said. "We are closely monitoring business activity to ensure our growth investments are aligned with local market opportunities to drive continued improvements in our operating results."
Northwest Hardwoods up for sale again
Former Weyerhaeuser unit Northwest Hardwoods is reportedly up for sale again by American Industrial Partners, the same private equity firm that bought the company in 2011.
According to a report in the Wall Street Journal, American Industrial Partners has hired bankers at Goldman Sachs to market the company.
Northwest Hardwoods is a manufacturer and distributor of lumber based in Tacoma, Wash. Its various species include oak, maple, cherry and walnut, which is used to make kitchen cabinets, hardwood flooring, furniture, boat interiors and other products.
Sources close to the company said the sale could likely go for around $700 million, up significantly from its original sale price of $108 million in 2011.