JELD-WEN Third Quarter Results Showcase Increased DemandNovember 4th, 2020 by Tara Taffera
“Consumers’ focus on their homes, coupled with our strategy to deliver profitable market share with key customers, is driving increased demand for products in both residential new construction and repair and remodel channels,” said Gary S. Michel, president and chief executive officer JELD-WEN Holding, Inc.
These statements were made as the company announced its results for the three and nine months ended September 26, 2020, and points once again to the demand as homeowners seek to make upgrade to their homes, including doors and windows.
Net revenue increased by 1.9% to $1,112.9 million, according to the results. Adjusted EBITDA increased by 20.0% to $130.7 million, through pricing and productivity including benefits from JELD-WEN Excellence Model (“JEM”) deployment as well as footprint rationalization and modernization. Free cash flow of $143.7 million improved $83.4 million during the first nine months of 2020, and a “strong balance sheet provides flexibility with record liquidity of $952.8 million,” the company reported.
“I am proud of our associates, whose commitment to operational execution, safety and delivering for our customers produced revenue growth and margin expansion that exceeded expectations,” said Michel. “The rigorous deployment of our business operating system, the JELD-WEN Excellence Model, and disciplined adherence to our playbook, produced positive price realization, profitable share gain, and favorable productivity that led to a substantial acceleration in third quarter margin expansion.”
He added that employees will continue to meet increased demand.
“Globally, JELD-WEN associates are focused on safely meeting this demand with the level of product quality and service that customers know and expect from us,” he said. “We expect that our productivity initiatives and structural cost reductions through footprint rationalization and modernization will accelerate the bottom-line benefits of this growth.”
Third Quarter Highlights
Additional highlights from the third quarter include:
• Net revenue increased $20.9 million, or 1.9%, to $1,112.9 million, compared to $1,092.0 million for the same period last year.
• Net income was $25.5 million during the third quarter, compared to net income of $17.0 million in the same quarter last year, an increase of $8.4 million. The increase in net income was primarily due to higher gross profit from improved price realization and operational improvements and a lower effective book income tax rate, partially offset by higher SG&A primarily due to legal expenses. Adjusted net income for the third quarter increased $26.0 million, or 97.7%, to $52.6 million, compared to $26.6 million in the same quarter last year, according to the company.
• Adjusted EBITDA increased $21.8 million, or 20.0%, to $130.7 million, compared to the same quarter last year.
• In North America, net revenue increased $4.3 million, or 0.6%, to $662.7 million, due to a 1% increase in core revenue.
• In Europe, net revenue increased $23.3 million, or 8.1%, to $311.0 million, due to a 5% positive impact from foreign exchange and a 3% increase in core revenue.
• In Australasia, net revenue decreased $6.6 million, or 4.5%, to $139.2 million, due to an 8% decrease in core revenue, partially offset by a 3% favorable impact from foreign exchange.