Masonite International Corp. (Masonite) recently announced its third quarter (3Q) financial results, including a nearly 10-percent increase in net sales. The company credits its growth to numerous acquisitions made over the past few years, the latest of which includes Bridgewater Wholesalers Inc. (Bridgewater), in a deal that closed November 5.

Bridgewater serves the Mid-Atlantic and Northeastern U.S. regions, as a fabricator and distributor of door systems and related components. The company includes approximately 350 employees, across five facilities in Pennsylvania, New Jersey, New York and Massachusetts.

Officials for Masonite say the company has been Bridgewater’s main supplier of door system components. As such, Bridgewater would have added, “approximately $55 million of incremental net sales to Masonite’s North America Residential segment for the twelve months ended September 2018, after adjusting for intercompany transactions,” according to company officials. This makes the acquisition a promising move going forward, based on the purchase price of $23 million, which is net of cash acquired.

“[Bridgewater] has been an integral partner to Masonite for over three decades, providing outstanding service to their customers,” says Tony Hair, president of Masonite’s global residential business. “The combination of Masonite doors and [Bridgewater]’s expertise with value-added services provides continued access to the products and services that builders and dealers know and trust.”

Bridgewater marks Masonite’s tenth acquisition in the last five years, which company officials say made their mark on 3Q results. Compared to the 3Q of 2017, the company’s net sales increased by 8 percent to $557 million, versus $518 million. Looking specifically at acquisitions, the 2018 acquisition of Graham Manufacturing Corporation (Graham) and The Maiman Company (Maiman), as well as the 2017 acquisition of A and F Wood Products, combined to contribute 26 percent of incremental net sales. The company acquired A and F, a wholesaler and fabricator of architectural and commercial wood doors in the Midwestern U.S., in October of 2017. In June of this year, Masonite acquired the operating assets of wood door companies under AADG Inc., including Graham and Maiman.

“We delivered another quarter of year on year sales growth, due again to strong performance from our acquisitions and higher average unit prices,” says Masonite president and CEO, Fred Lynch.

Despite its successes through acquisition, Masonite did experience some setbacks in the 3Q. Net income dropped to $25 million, compared to $29 million in the 3Q of 2017, a decline the company attributes to “extinguishment of debt.” Diluted earnings per share also dropped to $0.89, compared to $1.00 from the same time a year earlier.

“In the third quarter, the benefit from previous price increases was not enough to fully cover rising costs,” Lynch says. “Our team continues to pursue multiple strategies to improve margins despite a strong inflationary environment.”

At the same time, adjusted earnings per share did increase to $1.03 compared to $1.00 from the 3Q of last year. Similarly, adjusted EBITDA increased by 2 percent, to $71 million, versus $69 million.

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