Profits tumble at Masonite
Masonite reported that second quarter 2019 net sales slipped 1% to $563 million as compared to net sales $567 million in the first quarter of 2018.
Excluding the impact of foreign exchange, net sales increased 1%, the Tampa, Fla.-based door manufacturer said.
Net income attributable to Masonite plummeted more than 34% to $24 million for the quarter compared to a net income of $35 million for the same period last year.
While operational productivity increased at the company, profits were hit by lower sales volume, inflation in manufacturing wages and benefits, and rising materials costs including higher tariffs.
North American residential net sales were $380 million, flat compared to the second quarter of 2018 while architectural division sales increased 19% to $97 million.
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The bottom line: Tariffs and rising wages offset profits as the company’s second quarter net income falls by $11 million to to $24 million.
What the CEO said: “We are pleased we have driven year-on-year adjusted EBITDA margin expansion for the second consecutive quarter, despite weaker than anticipated volumes," said Howard Heckes, president and CEO. “Since joining Masonite in early June, I have immersed myself in the business and witnessed our employees’ commitment to delivering results and this quarter is no exception. The organization is on target with previously communicated restructuring initiatives and remains focused on operational excellence.”
Heckes joined Masonite as CEO on June 3 of this year and replaced Fred Lynch.
Company info: The full second quarter 2019 report from Masonite is available here.
Excluding the impact of foreign exchange, net sales increased 1%, the Tampa, Fla.-based door manufacturer said.
Net income attributable to Masonite plummeted more than 34% to $24 million for the quarter compared to a net income of $35 million for the same period last year.
While operational productivity increased at the company, profits were hit by lower sales volume, inflation in manufacturing wages and benefits, and rising materials costs including higher tariffs.
North American residential net sales were $380 million, flat compared to the second quarter of 2018 while architectural division sales increased 19% to $97 million.
###
The bottom line: Tariffs and rising wages offset profits as the company’s second quarter net income falls by $11 million to to $24 million.
What the CEO said: “We are pleased we have driven year-on-year adjusted EBITDA margin expansion for the second consecutive quarter, despite weaker than anticipated volumes," said Howard Heckes, president and CEO. “Since joining Masonite in early June, I have immersed myself in the business and witnessed our employees’ commitment to delivering results and this quarter is no exception. The organization is on target with previously communicated restructuring initiatives and remains focused on operational excellence.”
Heckes joined Masonite as CEO on June 3 of this year and replaced Fred Lynch.
Company info: The full second quarter 2019 report from Masonite is available here.