Trex turns in a banner Q3
Decking manufacturer Trex reported third quarter consolidated sales jumped 45% to $336 million from third quarter 2020 sales of $231.5 million.
Residential sales soared 46% to $319 million, with Trex Commercial contributing $17 million to net sales.
The Winchester, Va.-based manufacturer noted that the increase in net sales was largely due to volume growth across all Trex Residential product lines. But Trex also said that labor shortages constrained the extent of the volume growth.
Sales growth also reflects price increases on certain product lines at Trex Residential that were realized in early September 2021 to address inflationary pressures in key raw materials and freight.
Trex posted a net income of $74 million for the quarter, which is a 73% increase from a net income of $43 million in the third quarter a year ago.
During the quarter, Trex announced that it plans to add a third residential manufacturing facility in Little Rock, Ark., joining the company’s operations in Nevada and Virginia.
The new campus will sit on nearly 300 acres of land and will include buildings dedicated to decking and railing production, plastic film recycling and processing, reclaimed wood storage, warehousing, and administrative offices.
When completed, the new facility will expand Trex’s production capacity and address increased demand for Trex Residential outdoor living products. Construction is slated to begin in early 2022 with the first production output anticipated in 2024.
Funded primarily through ongoing cash generation, the company said that it expects to invest approximately $400 million over five years in the development of the new Arkansas site.
###
The Bottom Line: Trex earnings shoot up 73% to $74 million as sales rise 45% to $336 million.
What the CEO said: “The strength of the outdoor living repair and remodel sector and continued broad-based demand for Trex-branded decking and railing products, together with our expanded manufacturing capacity, drove impressive revenue growth of 45% in the third quarter,” said Trex President and CEO Bryan Fairbanks. “The accelerated pace of market share conversion from wood to composites continues, and our ability to capture a large portion of this expanded addressable market reflects the strength of our brand and the range of our product portfolio, which supports consumer decision-making by providing a range of product aesthetics, features and price points that have broad appeal and distinct competitive advantages over wood.”
Company info: Click here to read the full third quarter 2021 financial report from Trex.
