Masco makes good on profit margins
Masco Corporation started off the first fiscal quarter on a strong foot, with double-digit gains in adjusted operating profit margin and a 39% increase in adjusted operating profit.
The company's adjusted operating profit margin was up 13.8% for the quarter, a 350 basis point increase.
Net sales for the first quarter were up 4% to $1.7 billion (offset only by a 1% decrease owing to foreign currency translation).
Net income also improved substantially, increasing to $109 million from last year's $64 million.
“The year is off to a great start with strong performances from all of our businesses,” said Masco president and CEO Keith Allman. “Our industry-leading plumbing businesses maintained their positive momentum by delivering another quarter of top- and bottom-line growth both domestically and internationally. Our Decorative Architectural Products segment benefitted from increased demand for Behr’s core DIY, Behr Pro and Liberty Hardware branded products. Our cabinetry business continued to make progress against its strategic plan to optimize sales mix and increase profitability. Finally, our windows businesses capitalized on repair and remodel and new home construction growth in the U.S. and U.K.”
Net sales for Plumbing Products increased 2%, and Cabinetry Products was up 5%. Decorative Architectural Products experienced the most growth, however, with a 9% boost to net sales owing to Behr DIY and Behr Pro products. Windows and Other Specialty Products was also up 9%.
“The fundamentals driving our business are progressing in line with our expectations, and our performance this quarter demonstrates that we are fully focused on achieving our financial and operational objectives,” continued Mr. Allman. “We remain confident in our ability to successfully execute against our long-term growth strategies by leveraging our brand portfolio, industry-leading positions and our Masco Operating System. We expect that these growth strategies, coupled with our disciplined capital allocation approach and strengthening balance sheet, will continue to create shareholder value in 2016.”