Revenue Results for Two Major Industry Players Confirms Sales Aren’t Slowing DownMay 3rd, 2021 by Tara Taffera
Jeld-Wen Holding Inc. announced first quarter financial results last week and reported that net revenue increased by 11.6% to $1.1 billion. Core revenue growth occurred across all three segments, but was led by North America core revenue growth of 9%. These numbers allowed the company to revise its projections for the full year: Net revenue growth is now expected to be within a range of 8% to 11%, compared to 4% to 7% previously.
The same is true at Fortune Brands Home and Security which also published its results last week. For the first quarter of 2021, sales were $1.8 billion, an increase of 26% over the first quarter of 2020. “The Company now anticipates delivering full-year sales growth in the range of 20% to 22%. This reflects the company’s revised assumptions of a global home products market now expanding by 9% to 11%, including growth in the U.S. home products market of approximately 10% to 12%,” according to Fortune’s financial results.
All this points to continued health and growth in the housing and remodeling market. Following are more details from the financial reports for both companies.
Jeld-Wen’s Strong Start to 2021
Net revenue for the three months ended March 27, 2021 increased $113.2 million, or 11.6%, to $1.1 billion, compared to $979.2 million for the same period last year. The increase in net revenue was primarily driven by 6% core revenue growth and a 5% positive impact from foreign exchange. Core revenue growth was driven by a 4% pricing benefit and a 2% positive contribution from volume/mix, according to the company’s financial results.
Net income was $25.5 million during the first quarter, compared to a net loss of $200,000 in the same quarter last year, an increase of $25.7 million. The increase in net income was primarily due to higher gross profit from improved price realization, operating leverage from volume/mix and operational improvements. Adjusted net income for the first quarter increased $14.8 million, or 113.0%, to $27.9 million, compared to $13.1 million in the same quarter last year, the company reported.
“Jeld-Wen delivered a strong start to 2021, building on continued operating momentum and disciplined execution, generating significant improvement in revenue, margin, and cash flow,” said Gary S. Michel, president and CEO. “The rigorous deployment of our business operating system, the Jeld-Wen Excellence Model (“JEM”), throughout the organization is producing consistent growth and margin expansion … We remain optimistic on performance for the remainder of the year driven by the cadence and quality of operational initiatives currently underway and supportive market fundamentals for both residential new construction and repair and remodel activity.”
Fortune Brands Reports Growth Across the Board
At Fortune Brands, sales for the company’s Outdoors and Security segment increased 47%, driven by the addition of Larson and strong double-digit sales growth of composite decking and doors. Excluding Larson, organic sales increased 15%.
For the first quarter of 2021, sales were $1.8 billion, an increase of 26% over the first quarter of 2020. Operating income was $248.4 million, compared to $155 million in the prior-year quarter. At the end of the quarter, net debt was $2.3 billion and net debt to EBITDA was 2.1x. The Company had $356 million in cash and $755 million of availability under its revolving credit facilities.