Bill Griffiths will be passing on his current position of president and CEO of Quanex to Wilson.

Released on Wednesday, Quanex Building Products’ fourth-quarter and fiscal year (FY) 2019 results show net sales increased for the 12 months ending in October, but dipped over the last quarter. The company also announced the promotion of its current chief operating officer, George Wilson, to the position of president and CEO. Wilson succeeds current CEO Bill Griffiths, effective January 1, 2020.

“It’s been a good ride and we’ve made significant progress in the six years that I’ve been here,” said Griffiths in a conference call Thursday discussing the company’s financial results. Both Griffiths and Wilson indicated that there would be no change in the company’s strategies with the shift in leadership. Griffith will also remain as chairperson for the company’s board, continuing to advise Wilson in his new role.

George Wilson will become the new president and CEO of Quanex on January 1, 2020.

The results discussed in the call reveal that net sales were up to a total of $893.8 million from $889.8 million for the 12 months prior, but were down to $240.4 million from $244.1 million for the three months ending October 31. Gross margin grew 0.7% from $56.4 million to $57.2 million for the quarter and by 0.6%, from $192.8 million to $199.4 million annually, on a year-over-year basis.

The company attributes a quarterly decline to continued softness in the North American cabinet components segment but North American and European fenestration segments helped to offset those losses, leading to overall growth over a 12-month period.

“Despite what has been a softer demand environment compared to our original forecast for 2019, we converted well operationally and benefitted from improved pricing,” said Griffiths.

The company saw growth for both the FY and fourth quarter in adjusted net income, which advanced from $22.7 million to $31.4 million for the year and from $7.6 million to $14 million over the fourth quarter. The adjusted earnings before interest, tax, depreciation and amortization (EBITDA) also grew from $25 million to $34.4 million for the quarter and from $89.9 million to $102.7 million for the year.

Predictions for 2020 are conservative, due to several factors, officials said, including trade conditions that point to a slight growth for the fenestration segments, which is predicted to be offset by continued decline among cabinets.

“Overall, on a consolidated basis, this should equate to sales of approximately $865 million to $885 million in fiscal 2020,” Griffith said. “However, we expect to continue on our journey of operational excellence by converting well and managing costs. Therefore, we expect to generate between $102 million and $110 million in adjusted EBITDA in fiscal 2020, which would yield a margin expansion of approximately 60 basis points to the midpoint of guidance.”

Officials said they expect results to remain consistent from quarter to quarter in 2020 and only foresee a redirection if trade conditions adjust or the cabinet market shifts.

The company also plans to remain focused on generating cash and opportunistically repurchasing stock while paying back debt, of which the company repaid $52.5 million in 2019.

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