Beacon Roofing posts record sales for quarter, year
Beacon Roofing Supply, the Peabody, Mass., distributor of roofing and other housing exterior materials, posted net sales of $575.6 million for its fourth fiscal quarter, a 19.3% rise over sales of $482.6 million in the same quarter last year.
Existing market (organic) sales, which exclude branches acquired after the beginning of last year's fourth quarter, increased 15.6%. In existing markets, residential and non-residential roofing product sales increased 25.7% and 10.8%, respectively, while complementary product sales declined only 1.0%. Fourth-quarter roofing sales this year were favorably impacted by higher average selling prices and by increased business in several markets that experienced significant spring hail storms.
Net income for the fourth quarter, which ended Sept. 30, was $31.3 million, which included a one-time income tax benefit of $5.1 million. This compares with $16.9 million in 2010, an improvement of 85.3%. This year's fourth-quarter net income, even prior to the tax benefit, represented a record for any prior quarter, according to the company.
Year-end results showed a 12.9% increase in sales to a record $1.82 billion in 2011 from $1.61 billion in 2010. Existing market sales increased 9.3%. The annual existing market results exclude branches acquired during 2011 and 2010. In existing markets, residential and non-residential roofing product sales were up strongly at 8.8% and 12.8%, respectively, while complementary product sales increased 1.7%. Annual roofing sales this year were also impacted favorably by higher selling prices and repair work demand caused by spring hail storms.
Net income was $59.2 million compared with $34.5 million in 2010, an increase of 71.5%.
Paul Isabella, Beacon’s president and CEO, noted in a prepared statement that the company had set records for both its quarter and fiscal-year results. “Most of our regions achieved double-digit sales percentage increases in the fourth quarter and substantially exceeded our fourth-quarter and full-year sales and income expectations,” Isabella said. “Once again both our residential and non-residential product sales showed double-digit percentage increases for the quarter. Our complementary product sales were down only 1%. Our roofing businesses have benefited both from a pick-up in volume, including some storm business, and from industry-wide price increases mostly during the second half of the year. Our commercial business has remained consistently strong throughout this year. We were able to use our strong financial position to increase inventories ahead of some vendor price increases, which enabled us to achieve gross margins that were significantly above last year's rates.
“We continued to exercise prudent expense controls to further improve our operating margin and our cash holdings have increased since last year even after this year's third-quarter purchase of Enercon Products. We continue to aggressively seek quality companies that fit our target acquisition profile, such as Denver-based Fowler & Peth acquired in the first quarter of fiscal 2012. We believe there are many favorable long-term growth factors in our industry, so we expect to continue expanding our geographic reach in 2012."