Record quarter for Universal Forest Products
Building products manufacturer Universal Forest Products, Inc. (UFPI) reported record fourth quarter sales of $966.1 million, a 12% increase compared to fourth quarter 2016 net sales of $859.6 million.
The Grand Rapids, Mich.-based company also reported record fourth quarter net earnings of $33.1 million, nearly a 48% increase from net earnings of $22.4 million for the same period a year ago. Fourth quarter 2017 earnings include $6.4 million as a result of changes to the corporate tax structure following the Tax Cuts and Jobs Act.
For the full year, 2017 net sales rose 22% to $3.94 billion from 2016 net sales of $3.24 billion. The company reported full year net earnings of $124 million, rising nearly 14% from 2016 net earnings of $105.5 million.
UFPI reported fourth quarter gross retail sales increased 20% to $330.6 million in gross sales. Full year retail gross sales were up 15% to $1.49 billion.
Construction gross sales during the quarter were up 10% to $305.8 million, mostly due to price increases as a result of the lumber market, the company said. Unit sales to manufactured housing customers grew 4% during the period, while sales to residential and commercial construction customers fell 2% and 3%. Residential construction sales were likely affected by project delays associated with higher lumber prices, UFPI reported.
Full year construction segment gross sales increased 16% to $1.18 billion, driven by a 7% percent increase in unit sales and a 9% increase in prices. Residential construction unit sales grew 7%, and unit sales to manufactured housing customers rose 9% over 2016.
“The employees of Universal did a great job managing our business through a challenging lumber market that pressured margins for our products at different periods throughout the year,” said CEO Matthew J. Missad. In 2017, average prices for framing lumber and southern yellow pine rose 20 percent and 7 percent, respectively, over 2016, but fell during the Company’s peak selling times, reducing margins on certain products.”
“We experienced terrific growth with new products in 2017, making significant inroads in the retail market with new products such as our UFP-Edge profile lines and several product introductions in our Deckorators line,” Missad added.
Missad noted that despite challenges that remain in the lumber market, the company is optimistic and plans to invest a portion of its income, saved through the tax reform bill, for capital expenditures.
