Universal Forest buys pallet, container manufacturer
Universal Forest Products has announced that one of its subsidiaries is expanding the company’s industrial business in the northwest United States with the acquisition of the operating assets of Nepa Pallet and Container Co., a manufacturer of pallets, containers and bins for agricultural and industrial customers.
The purchase of Nepa by UFP Washington advances a number of Universal’s strategic objectives: to enter that geographic market without adding capacity to the marketplace, to expand its industrial busines, and to grow by acquiring successful companies.
Nepa has facilities in Snohomish, Yakima and Wenatchee, Wash., and had trailing 12-month sales through September 2012 of $25 million. Closing is expected to take place in early November 2012.
“In its 75 years, Nepa has built a strong reputation as a solid manufacturer with great customer service. Its employees are loyal and dedicated, which is consistent with our culture,” said Matthew Missad, CEO of Universal Forest Products. “We look forward to adding Nepa and its people to the Universal family of companies, and growing with them in a territory that’s important to Universal’s future and success.”
Beacon makes Pittsburgh acquisition
Beacon Roofing Supply, one of the nation’s largest distributors of roofing and other exterior building products, has reached an agreement to acquire McClure-Johnston Co., a Pittsburgh-based distributor of residential and commercial roofing products and related accessories. The purchase price was not disclosed.
Headquartered in the Pittsburgh suburb of Braddock, Pa., McClure-Johnston has 14 locations with eight in Pennsylvania, three in West Virginia, one in Western Maryland and two in Georgia. Annual sales are approximately $85 million. The transaction is expected to close on or before Nov. 1, 2012.
Paul Isabella, Beacon’s CEO and president, emphasized the strategic fit of the acquisition and the compatibility of the two companies in the company’s announcement. He stated, "For nearly a century, McClure-Johnston has been a leader in the industry. We are very excited that the Hogan and Oxenreiter families chose to align the great company they have built together with Beacon as we continue our expansion in these key markets and beyond. We are very pleased to welcome them and the entire experienced and highly regarded McClure-Johnston team to the Beacon family."
Headquartered in Peabody, Mass., Beacon Roofing Supply operates 210 branches in 38 states in the United States and across Canada.
Builders FirstSource: sales are up, but so are losses
Builders FirstSource, the Dallas-based pro dealer, reported net sales of $291.8 million for its third fiscal quarter, an increase of 34.3% when compared with the third quarter of 2011. The company estimated that sales increased approximately 27% due to increased volume and 7% due to price.
Losses from continuing operations were $12.3 million for the quarter, which ended Sept. 30. This compares with a loss of $11.5 million in the third quarter of 2011.
“Our topline growth continues to exceed the increase in residential construction activity, as actual single-family housing starts in the south region increased 27.7% over the same time period, and single-family units under construction increased only 12.4%," said Builders FirstSource CEO Floyd Sherman. "For the second consecutive quarter, we reported positive adjusted EBITDA, finishing with $3.0 million for the current quarter as compared with an adjusted EBITDA loss of $0.7 million in the third quarter of 2011.”
Chad Crow, Builders FirstSource senior VP and CFO, said that the company’s results were negatively impacted by inflation on commodity lumber and “our limited ability to adjust intra-quarter customer pricing.”
“While we were able to pass on some price increases as part of our third-quarter pricing, we once again experienced a rising commodity market for most of the quarter,” Crow added. “Commodity prices increased, on average, 14% from the end of the second quarter through mid-September, before falling back somewhat by quarter-end. These factors, combined with what is still an extremely competitive pricing environment, constrained our gross margin during the quarter.”