News at Cornerstone Includes Acquisition, New CEO and Significant GrowthAugust 5th, 2021 by Tara Taffera
Cornerstone Building Brands Inc., based in Cary, N.C., has reached an agreement to acquire Cascade Windows in Spokane Valley, Wash., for a cash purchase price of $245 million. Cascade has approximately 800 employees at six manufacturing and three distribution locations across the West and Pacific Northwest. But, that’s not the only news at Cornerstone—the company reported strong net sales growth in its second quarter financial results, and announced a new CEO.
First to the acquisition, which will expand the company’s presence on the West Coast.
“Cascade is an excellent strategic fit for our company and advances our strategy to grow in the large, deep residential windows market,” said James S. Metcalf, chairman and CEO. “Additionally, the acquisition expands our manufacturing presence across the rapidly growing West Coast region and enhances our tailored solutions offering for our customers.”
Cascade generated approximately $160 million in sales during the trailing 12 months ended May 2021. The transaction, subject to regulatory approval and customary closing conditions, will be funded with cash on hand and is scheduled to close in the third quarter of 2021.
The addition of Cascade comes as Cornerstone posted second-quarter net sales growth of 29%, with strong performance across all business segments. The company delivered net income of $9 million, with adjusted net income of $84 million, 11% higher than the prior year.
Net sales for the windows segment for the quarter were $579.7 million, an increase of 35.4% versus the same period last year. Strong volumes across all sales channels drove increased volume of 22.5% coupled with incremental sales growth from recent acquisition of prime windows, according to the company.
“We continue to leverage the strengths of our business model to deliver long-term profitable growth,” said Metcalf. “This quarter we delivered record second-quarter earnings and made significant progress toward optimizing our portfolio. These actions strengthen our financial flexibility and position the company to deliver value to all our stakeholders.”
Finally, Cornerstone announced Metcalf’s upcoming retirement, effective September 6, 2021. As part of the leadership transition, he will continue in the role of executive chairman of the board through March 31, 2022. Rose Lee will succeed Metcalf as president and CEO, also joining the board as a director of the company.
“Leading Cornerstone Building Brands since its inception has been such an honor for me,” said Metcalf. “Together, we worked diligently to deliver on our strategy towards profitable growth and strengthen our industry leadership. This has been a remarkable journey of transformation and growth and the company is well prepared for this leadership transition.”
Lee is president of DuPont’s Water and Protection business. She joined DuPont in 2015, and in in 2016 assumed the role of president of Protection Solutions, then was named president, Safety and Construction in 2017. Prior to joining DuPont, Lee held senior leadership positions at Saint-Gobain in several general management positions serving construction sectors, among others.
“Rose’s background, skills, and expertise give the board full confidence that she is the right person to serve as the next leader of Cornerstone Building Brands as it continues positioning for growth and value creation. I have full confidence that Rose and our management team will continue to provide dynamic leadership to create even greater success for our customers, shareholders and employees,” Metcalf added.
“I am extremely excited to join Cornerstone Building Brands as CEO and lead its next growth chapter,” said Lee. “I look forward to working with my 20,000 colleagues to scale our impact as a premier exterior building products company.”