Masco Q4 sales flat but profits soar
Earnings for the full year rise better than 27% in 2019.
Home improvement products manufacturer Masco reported flat fourth quarter 2019 sales of $1.64 billion.
For the year, Masco posted sales of $6.7 billion, also relatively flat compared to sales of $6.65 billion in 2018.
Profits for the quarter soared as Masco posted a net income of $453 million, up from a net income of $194 million for the same period last year. Earnings for the year increased 27.4% to $935 million from earnings of $734 million for fiscal year 2018.
In 2019, Masco sold its Milgard Windows and Doors business to MI Windows and Doors in a $725 million deal and agreed to sell its Masco Cabinetry business.
Plumbing products net sales increased 2% for the quarter driven by 5% growth in North America. Decorative architectural products sales fell 3%, with growth in paints and other coating products offset by lower sales in lighting.
Based in Livonia, Mich., Masco’s brands include Behr paint; Delta and Hansgrohe faucets, bath and shower fixtures; KraftMaid and Merillat cabinets; Kichler decorative and outdoor lighting; and HotSpring spas.
The Bottom Line: Sales are flat for the quarter and 2019 while profits rise sharply.
What the CEO said: “We finished the year on plan, with solid growth in both North American plumbing and paints and other coating products,” said Keith Allman, Masco president and CEO. “We also closed the sale of our Milgard Windows and Doors business, signed an agreement to sell our Masco Cabinetry business, and returned $495 million to shareholders through share repurchases and dividends during the quarter.”
“2019 was a transformative year for Masco,” said Allman. “We executed on our strategy to become more focused on our higher margin, lower ticket, and less cyclical Plumbing and Decorative Architectural Products segments. We also delivered on our commitments, achieving sales growth of 2% in local currencies and adjusted earnings per share growth from continuing operations of 6 percent, despite slower overall end markets and higher input costs for many of our products.”
Looking ahead, Allman said, “The fundamentals of the repair and remodel industry, which now represents approximately 90% of our business, remain strong. We believe our markets and our performance will improve throughout the year as we work through higher input costs in the first half of 2020.”
Company info: The full fourth quarter 2019 and year-end report from Masco can be read here.
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