What’s News October 2020

July 27th, 2021 by Nathan Hobbs

Leading News

Companies Satisfied With Impacts to 2Q

With the economic impacts of COVID-19 landing squarely in second-quarter 2020, numerous door and window providers remain pleased, even as revenues decreased by 10-12%. Amid what many labeled a stronger than expected market, some companies reported modest cost reductions associated with changes from COVID-19, in the end crediting employees for their adaptability and resilience.

On the distribution side, Huttig Building Products reported that net sales were 12.1% lower than second quarter 2019—a mark that president and CEO Jon Vrabely said his company was pleased with considering the impacts of COVID-19. Hutting minimized damages by acting, “early, decisively and aggressively,” he said, to adjust cost structure and inventory in order to mitigate the threat of the pandemic. In millwork, disruptions were mainly attributed to supply chain issues, resulting in a 17.9% decrease in sales.

Fortune Brands Home and Security Inc., Jeld-Wen and Masonite were among the manufacturers reporting 10-12% decreases in net sales. Despite those changes, executives for all three companies said they, too, were pleased with second-quarter results considering the circumstances. After a 9% drop in doors and security sales, officials for Fortune Brands said doors were among the products exceeding expectations, considering the impacts that COVID-19 had on the company’s supply chain.

“We are pleased with the resilience in market conditions and are positioned advantageously for the back half of the year and into 2021,” said Nicholas Fink, the company’s CEO. “We continue to see encouraging levels of R&R spending and rising activity in new construction.”

The company is maintaining its suspension of any previous financial guidance and projections for 2020 and beyond, and in late April executed a supplemental 364-day revolving credit facility, increasing its borrowing capacity by $400 million.

After sales for Masonite decreased by 11% to $500 million, versus $563 million in second quarter 2019, Howard Heckes, president and CEO, said he was “extremely pleased” with the company’s performance and the resilience of its business. Year-to-date, North American residential net sales were up 4% compared to the first six months of 2019. At the same time, the company was able to slash $3 million from selling, general and administrative expenses, primarily due to COVID-19-related cost reductions and non-cash items.

Though revenue declined by 11.3% year-over-year at Jeld-Wen, results improved sequentially throughout the quarter, officials said, setting performances that were above expectations. With a 13% headwind from volume/mix related to COVID-19, the company reported a partial offset by a 3% pricing benefit.

“While the persistence of the virus in many countries globally contributes to near-term demand uncertainty, we believe that the pandemic will result in long-term trends that will drive improved demand for our products in both new construction and repair and remodel activity,” said Jeld-Wen president and CEO, Gary S. Michel

Glass Guru Posts Record Numbers

Officials for the Glass Guru franchise organization proudly announced that nearly a third of its locations hit record monthly revenue milestones in June 2020. The organization also saw its highest aggregate monthly revenue amount since the company began franchising in 2007.

“The team at headquarters couldn’t be more proud of the way each franchise has stepped up and risen to the challenge,” said Dan Frey, president and founder of the Glass Guru.

Legal

Door Manufacturing Caught Up in Ponzi Scheme

Two residents of the province of British Columbia, Canada, were ordered by the British Columbia Securities Commission (BCSC) to pay $6.3 million for committing fraud through a Ponzi scheme. Todd Norman John Bezzasso raised approximately $5 million from a total of 85 investors through two
companies known as Bezzaz Holdings Group Ltd. (Holdings) and Nexus Global Trading Ltd. (Nexus). Among the companies incorporated into the marketing and promotions for investment was a door manufacturing business. The door business isn’t identified in any of the documents relating to an investigation or ruling, nor has it been identified in other reporting.

Holdings was incorporated in British Columbia February 26, 2010. Although evidence posted amid the hearing did not include a share registry, based on witness testimony it is believed that the holdings company was wholly owned by Bezzasso, who began soliciting investors in late 2013 or early 2014.

Over the course of their dealings, an employee of Nexus was also involved in a door manufacturing business. The individual, listed simply as “VY” testified that none of Bezzasso, Nexus or Holdings had any cause for or right to raise money on behalf of the door manufacturing business, nor did they have any basis for promoting the door business through marketing materials. The employee of the door manufacturing business testified that he was not aware that Bezzasso was referencing the door manufacturing business in promotional materials.

Expansions

Jeld-Wen Set to Expand in N.C.

It looks like Jeld-Wen will soon be set to expand at its plant in North Wilkesboro, N.C., according to a notice posted on July 29, 2020, from the Town of North Wilkesboro. According to the Notice of Intent to Request Release of Funds, on or about August 14, 2020, the town of North Wilkesboro requested the NC Department of Commerce to release Federal Funds under Title I of the Housing and Community Development Act of 1974 for the following project: Jeld-Wen, Inc. Expansion The Community Development Block Grant (CDBG). Funding in the amount of $580,000 will assist in construction of an elevated water tank to serve Jeld-Wen’s facility at the town’s industrial park, according to the notice. The total cost to the town of North Wilkesboro for the new elevated water tank
is estimated to be $2.2 million.

Jeld-Wen is expanding its operations at the site, which will invest approximately $8 million in the community, the notice states, adding “As a result, Jeld-Wen, Inc. has hired 29 new employees as committed for the CDBG grant with at least 60% of the new hires meeting the Low to Moderate Income requirements for CDBG funding.”

Plant manager Jeff Mang addressed the expansion during the Wilkes Economic Development Corp.’s annual meeting in September 2019, referencing the need for a water tank, which he said the company needs for increased water pressure for a sprinkler system for an expansion.

“We’ve got a pad leveled off on our 13 acres, so we’re looking forward to breaking ground in the next year or two to expand even more,” he said at that meeting.

Associations

FGIA Updates Sealants Guide

The Fenestration and Glazing Industry Alliance (FGIA) updated a technical document intended to aid in the selection, use and application of sealants. AAMA 851, Fenestration Sealants Guide for Windows, Window Walls and Curtain Walls, an FGIA standard, is the first update to this document, which was published originally in 2009.

According to Steve Altum of Dow Performance Silicones, chair of the Fenestration Sealant Application Guide Task Group, “While the individual manufacturer of sealant choice should always be consulted for specific performance attributes, this guide will help to identify some of the key considerations such as substrates, environmental, joint movements and compatibility of components used in the overall system design.”

AAMA 851 reviews the type of sealants currently in use and their application.

Technology

Window-Installing Robots Coming

Engineers at Carnegie Mellon University announced they’re looking to replace some window installers with robots. In July, the university announced that in collaboration with YKK AP Inc. and under the leadership of Kenji Shimada, the Theodore Ahrens Professor of Engineering in the Department of Mechanical Engineering, a team of experts in its Computational Engineering and Robotics Laboratory are working on the project.

Shimada says his team’s goals include creating a robot that can install windows, “more efficiently than any human could.” At the same time, he admits that the undertaking, “is a pretty difficult task,” but his group is designing and building with the goal of automating and cutting the task down to five minutes,
including 3D sensors for measuring.

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