Sales surge at Beacon Roofing Supply
Third-quarter sales of both residential and non-residential product showed double-digit percentage increases for the Peabody, Mass.-based specialty distributor.
Total sales increased 14% to $540.7 million, a record for a third quarter, the company said. Net income also was at a third-quarter record high — $24.1 million. That’s up 47.9% from the prior-year quarter.
"Our roofing businesses benefited from a pick-up in volume during the quarter, including some hail storm business, and from industry-wide price increases, although our commercial business has remained consistently strong throughout this year," said Paul Isabella, the company’s president and CEO.
"We were able to use our strong financial position to increase inventories ahead of some vendor price increases, which enabled us to achieve more normal gross margins that were significantly above last year’s low rates," Isabella added.
The company’s purchase of Enercon Products was completed during the quarter.
Sales rise at Owens Corning
Owens Corning reported net sales of $1.5 billion for its second quarter of 2011, a 5% increase over sales of $1.4 billion in the same quarter of 2010.
Net income for the quarter, which ended June 30, was $78 million, compared with net earnings of $937 million a year ago.
In the building materials division, net sales were higher in the second quarter of 2011, as compared with the same period in 2010. The increase in net sales during the second quarter was the result of increased sales volumes within the roofing business. Offsetting this increase were lower sales volumes within the insulation business and the loss of sales from the divestiture of the U.S. masonry products business.
"Owens Corning delivered a strong second quarter," said chairman and CEO Mike Thaman. "The actions we took in the quarter built significant momentum across the company and position us for a strong second half."
In terms of outlook, the Toledo, Ohio-based company had previously estimated that composites would grow EBIT in excess of 40% for the year. However, as a result of a near-term correction in the Chinese wind energy market, as well as higher-than-anticipated inflation costs, the company now expects EBIT growth of about 25%.
Owens Corning continues to believe that the insulation business will be profitable in the second half of 2011. This outlook is consistent with the company’s previous guidance and reflects strong operating execution in a continuing weak market. The company’s new EcoTouch insulation product has been successfully launched across all residential markets in the United States and Canada.
In roofing, Owens Corning believes full-year EBIT margins of 20% are achievable in 2011. Storm activity in the United States in the first half of the year has created momentum in demand that is expected to continue into the second half of 2011.
Construction spending at a standstill in June
Numbers released this week from the U.S. Department of Commerce announced that construction during June 2011 was estimated at a seasonally adjusted annual rate of $773.2 billion, a 0.2% increase above the May estimate of $770.5 billion. The June figure is 4.7% below the June 2010 estimate of $810.4 billion.
During the first six months of 2011, construction spending amounted to $357.5 billion, 5.4% below $377.9 billion for the same period in 2010.
Spending on residential construction was estimated at $235.8 billion in June, a 0.3% dip below the revised May estimate of $236.5 billion. Non-residential construction was reported to be $257.7 billion in June, 1.8% above the revised May estimate of $253.1 billion.
Public construction was also flat. Overall spending for June was down 0.7% to $278.9 billion. Educational construction dropped 4.1% and highway construction decreased 1.6% compared with May 2011.