Trex feels impact of late start to deck season
The 2014 deck-building season got off to a late start, and Trex felt the impact in its first-quarter results.
The Winchester, Virginia-based company reported net sales of $100.6 million, down from $107.9 million in last year’s first quarter. Net income for the wood-alternative decking giant was $12.3 million, down from $21.6 million in the same period last year.
“The severe weather experienced throughout the country during the first quarter delayed the start of outdoor living project activity," said Ronald W. Kaplan, chairman, president and CEO. "Trex was affected by this trend. The impact was especially evident in March, when winter storms and low temperatures persisted throughout the month. Except for the weather-related impact to our sales, we are pleased with our first-quarter financial performance and remain confident about our strategy for the year."
Trex expects to bounce back in the second quarter with net sales of $125 million, marking a 27% increase for the quarter and an anticipated 9% gain for the first six months.
“In 2014, we are continuing the high-profile Engineered Artistry branding campaign we successfully launched last year," Kaplan said. "Macroeconomic indicators, including rising consumer confidence and the strengthening home remodeling market, bode well for our prospects."
Char-Broil names new CEO
Columbus, Georgia-based Char-Broil, a division of the W.C. Bradley Co., named Christine M. Robins as president and CEO, effective June 2.
Robins served for the past five years as president and CEO of Pittsburgh-based BodyMedia, a venture-backed pioneering company in wearable health sensors and software that help consumers and professionals better manage health and wellness. Robins totally transformed BodyMedia via a new business strategy and the diversification of products and customers leading to the successful sale of the company to Jawbone.
“Chris has an excellent background with two major and globally respected consumer products companies,” said Marc Olivié, W.C. Bradley Co. president and CEO.
Prior to joining BodyMedia, Robins spent four years with Philips Oral Healthcare in Seattle, Washington, where she was promoted to president and CEO of this global oral care business, which includes Sonicare power toothbrushes. Robins led the development and implementation of a totally new product pipeline and business model that generated dramatic growth in revenues and profitability and also led to significant global expansion, primarily in Eastern Europe and Asia.
Immediately following graduation from the University of Wisconsin – Madison in 1988, where Robins earned her BBA degree in Marketing and Finance, she was recruited by the S.C. Johnson company in Racine, Wisconsin, and spent seventeen years with the company in both Marketing and Finance roles for brands such as Raid, Glade PlugIns, Aveeno, and Ziploc.
Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for May 2, 2014
*Western – regional species perimeter foundation; Southern – regional species slab construction.
Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.
Lumber: SPF mills reported order files of a couple of weeks while continuing to sell off floor stocks. Western SPF lumber producers pressed market prices a few dollars higher throughout the week, often by decreasing discounts. Weather and persistently scarce truck availability played key roles in the Southern Pine lumber market. Torrential rain not only limited consumption in the East, it also created log shortages, forcing mill shutdowns. According to most sources, the number of trucks available to haul lumber constricted even more. Dry Coastal species lumber prices continued to trend higher, as steady demand met or exceeded production levels. Green Doug Fir pricing sagged early, but sales improved after midweek. Improving weather, as well as improving attitudes about the market, helped Inland species lumber producers move order files out and prices up. Wholesalers reported steady back-to-back business. Radiata Pine sellers report steady sales for Mldg&Btr at or above published levels. Offerings of Shop grades were not heard. Discounts for Ponderosa Pine #3 Shop reported last week seemed to have dried up. Mill quotes are at, or slightly above, published levels. Other prices were unchanged, as most producers have booked their May orders. The Ponderosa Pine board market for Selects and Commons has been led by #3 and #4 Shop, followed a good distance behind by #2&Btr. Eastern White Pine producers reported “steady” business, with prices firm but mostly unchanged. The weakness in prices anticipated by some has not occurred. Buyers purchased persistent volumes of Western Red Cedar after generating inventory holes, often finding their replacement costs higher. Some producers voiced concerns over the higher prices, fearing the loss of market share to alternative products.
Panels: Sales activity for OSB increased substantially in many regions. Producers reported heavy phone activity, with callers asking about orders they already had on the books, as well as prices for additional products. Eastern Canada was a much quieter market. Southern Pine rated sheathing prices surpassed their previous highs for the year by significant margins, as buyers replenished inventories. Most mill order files extended into the week of May 26. Strong engineered wood product demand for veneer and panels harnessed the overall plywood supply available to the general market. Strong sales activity in the Western Fir plywood market prompted producers to raise prices aggressively. Buyers approached the market a bit more cautiously late in the week. The week started with most markets for Canadian plywood on the quiet side. Prices were vulnerable and showed signs of weakness. By the second half of the week, activity had improved and producers reported extending mill order files out a few weeks. Particleboard mills in the West experienced demand that kept up with production, but not much more than that. Prices held but still carried some upward pressure. MDF sales remained lackluster, but mills sales kept up with production overall. MDF prices remained stagnant.
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