Press release

American Woodmark Corporation announces second quarter results

December 01, 2017

WINCHESTER, Va., Dec. 1, 2017 /PRNewswire/ -- American Woodmark Corporation (NASDAQ: AMWD) today announced results for its second fiscal quarter ended October 31, 2017.

Second Fiscal Quarter Ended October 31, 2017 Results

Net sales for the second fiscal quarter increased 4% to $274.8 million compared with the same quarter of the prior fiscal year.  Net sales for the first six months of the current fiscal year increased 6% to $551.6 million from the comparable period of the prior fiscal year.  The Company experienced growth in both the new construction and dealer channels during the second quarter of fiscal year 2018.

Net income was $19.8 million ($1.21 per diluted share) for the second quarter of the current fiscal year compared with $17.6 million ($1.07 per diluted share) in the same quarter of the prior fiscal year.  The Company was negatively impacted $0.02 per diluted share in the quarter due to a reduction in the domestic production deduction benefit resulting from discretionary pension contributions approved during the quarter.  Net income for the first six months of the current fiscal year was $42.0 million ($2.58 per diluted share) compared with $39.3 million ($2.39 per diluted share) for the same period of the prior fiscal year.

Gross profit for the second quarter of the current fiscal year was 20.9% of net sales compared with 21.3% in the same quarter of the prior fiscal year.  Gross profit for the first six months of the current fiscal year was 21.0% of net sales compared with 22.1% for the same period in the prior year.  Gross profit in the current quarter was impacted by higher transportation costs and material inflation.  Gross profit for the first six months of the current fiscal year was unfavorably impacted by higher transportation costs, material inflation and higher healthcare costs.

Selling, general and administrative costs for the second quarter of the fiscal year 2018 were 9.7% of net sales compared with 10.5% in the same quarter of the prior fiscal year.  Selling, general and administrative costs for the first six months of the current fiscal year were 9.8% of net sales compared with 10.5% for the same period in the prior year.  The improvement in the Company's operating expense ratio in the current quarter and the first six months of the current fiscal year was driven by favorable leverage from increased sales, lower incentive compensation costs and on-going expense control.

The Company generated net cash from operating activities of $41.8 million during the first half of fiscal year 2018 compared with $40.1 million during the same period in the prior year.  The increase in the Company's cash from operating activities was driven primarily by lower increases in customer receivables and higher operating profitability which was partially offset by higher inventories to support increased sales and lower increases in accounts payable.  Net cash used by investing activities was $31.1 million during the first half of the current fiscal year compared with $50.4 million during the same period of the prior year due to a $28.5 million reduced investment in certificates of deposit which was partially offset by increased investment in property, plant and equipment.  Net cash used by financing activities of $25.1 million increased $16.6 million during the first half of the current fiscal year compared to the same period in the prior year as the company repurchased 251,241 shares of common stock at a cost of $23.5 million, a $13.1 million increase from the prior year, and proceeds from the exercise of stock options decreased $1.0 million.

Agreement to Acquire RSI Home Products, Inc.

Earlier today American Woodmark Corporation publicly announced that it has entered into a definitive agreement and plan of merger with RSI Home Products, Inc. ("RSI"), a leading manufacturer of kitchen and bath cabinetry and home storage products.  The Company will host a conference call with investors, December 1, 2017 at 11:00 EST to discuss the second quarter results and the agreement to acquire RSI.  The live broadcast of American Woodmark Corporation's conference call will be available on-line at: www.americanwoodmark.com on Friday, December 1, beginning at 11:00 a.m. (Eastern Time). The online replay will follow immediately and continue for 30 days.  A telephonic replay will be available from 2:00 p.m. (Eastern Time) December 1 through 2:00 p.m. (Eastern Time) December 12, by dialing 719-457-0820 and entering passcode 9813605.  A presentation, which will accompany the call, will be available at www.americanwoodmark.com and will remain available after the call.

About American Woodmark Corporation

American Woodmark Corporation manufactures and distributes kitchen cabinets and vanities for the remodeling and new home construction markets.  Its products are sold on a national basis directly to home centers, major builders and through a network of independent distributors.  The Company presently operates nine manufacturing facilities and seven service centers across the country.

Forward-Looking Statements

Safe harbor statement under the Private Securities Litigation Reform Act of 1995: All forward-looking statements made by the Company involve material risks and uncertainties and are subject to change based on factors that may be beyond the Company's control.  Accordingly, the Company's future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements.  Such factors include, but are not limited to, those described in the Company's filings with the Securities and Exchange Commission and the Annual Report to Shareholders.  The Company does not undertake to publicly update or revise its forward looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

 

AMERICAN WOODMARK CORPORATION

                   

Unaudited Financial Highlights

                   

(in thousands, except share data)

                   

Operating Results

                   
     

Three Months Ended

 

Six Months Ended

     

October 31

 

October 31

     

2017

 

2016

 

2017

 

2016

                   

Net sales

 

$

274,769

   

$

264,076

   

$

551,596

   

$

522,226

Cost of sales & distribution

 

217,434

   

207,924

   

435,767

   

406,757

 

Gross profit

 

57,335

   

56,152

   

115,829

   

115,469

Sales & marketing expense

 

18,077

   

17,146

   

36,230

   

33,609

General & administrative expense

 

8,443

   

10,675

   

17,950

   

21,607

 

Operating income

 

30,815

   

28,331

   

61,649

   

60,253

Interest expense & other income

 

(648)

   

(99)

   

(1,186)

   

(137)

Income tax expense

 

11,708

   

10,793

   

20,799

   

21,092

 

Net income

 

$

19,755

   

$

17,637

   

$

42,036

   

$

39,298

 

Earnings Per Share:

               

Weighted average shares outstanding - diluted

 

16,268,078

   

16,440,321

   

16,319,224

   

16,410,652

                   

Income per diluted share

 

$

1.21

   

$

1.07

   

$

2.58

   

$

2.39

 

Condensed Consolidated Balance Sheet

(Unaudited)

     

October 31

 

 April 30

     

2017

 

2017

           

Cash & cash equivalents

 

$

162,545

   

$

176,978

 

Investments - certificates of deposit

 

57,500

   

51,750

 

Customer receivables

 

66,211

   

63,115

 

Inventories

 

46,723

   

42,859

 

Other current assets

 

9,189

   

4,526

 
 

Total current assets

 

342,168

   

339,228

 

Property, plant & equipment

 

121,732

   

107,933

 

Investments - certificates of deposit

 

24,250

   

20,500

 

Other assets

 

25,155

   

33,612

 
 

Total assets

 

$

513,305

   

$

501,273

 
           

Current portion - long-term debt

 

$

1,710

   

$

1,598

 

Accounts payable & accrued expenses

 

98,500

   

99,899

 
 

Total current liabilities

 

100,210

   

101,497

 

Long-term debt

 

16,087

   

15,279

 

Other liabilities

 

21,865

   

32,048

 
 

Total liabilities

 

138,162

   

148,824

 

Stockholders' equity

 

375,143

   

352,449

 
 

Total liabilities & stockholders' equity

 

$

513,305

   

$

501,273

 

 

Condensed Consolidated Statements of Cash Flows

(Unaudited)

     

Six Months Ended

     

October 31

     

2017

 

2016

           

Net cash provided by operating activities

 

$

41,838

   

$

40,146

 

Net cash used by investing activities

 

(31,136)

   

(50,417)

 

Net cash used by financing activities

 

(25,135)

   

(8,548)

 

Net decrease in cash and cash equivalents

 

(14,433)

   

(18,819)

 

Cash and cash equivalents, beginning of period

 

176,978

   

174,463

 
           

Cash and cash equivalents, end of period

 

$

162,545

   

$

155,644

 

 

View original content: http://www.prnewswire.com/news-releases/american-woodmark-corporation-announces-second-quarter-results-300564939.html

SOURCE American Woodmark Corporation

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