Beacon Roofing Supply announced results for its first quarter ended December 31, 2014 of the fiscal year ending September 30, 2015. Total sales increased 8% to a first quarter record $596 million in 2015, from $552.1 million in 2014.
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On an overall consolidated basis, residential roofing product sales increased 11.2%, non-residential roofing product sales increased 0.2%, and complementary product sales increased 18.5% over the prior year. During the first quarter, the company completed two acquisitions adding six new branches which drove $19.7 million of sales in the quarter.
Sales from greenfield branches opened in fiscal 2014 totaled $23 million. The first quarters of 2015 and 2014 both had the same number of business days.
Net income for the first quarter was $12.9 million, compared to $15 million in 2014. First quarter diluted net income per share was $0.26, compared to $0.30 in 2014.
Net income for the quarter was favorably impacted by gross margins which improved by 10 bps over the prior year, and unfavorably impacted by increased operating expenses which were primarily driven by the incremental costs associated with the 26 greenfields opened in fiscal 2014.
Paul Isabella, the company's President and chief executive officer, stated: "Fiscal 2015 is off to a solid start, as we drove record sales. We are particularly pleased with the growth of our residential product line which was up 11.2% over the prior year, aided by the 26 new branches opened in the prior fiscal year. Complementary sales were also a bright spot in the quarter, up 18.5%.
"The sales gains in these two particular product lines as well as stronger warehouse sales led to higher gross margins over prior year and over prior quarter. The combination of sales and margin growth led to EPS that was in line with our expectations and positions us well as we move through the second quarter and the balance of the year.
"Acquisition activity remains robust, as we added both Applicators Sales and Services in New England and Wholesale Roofing Supply in Texas during the quarter. Increases in operating costs were primarily a result of our continued investment in our growth strategy through acquisitions and new branches.
"Looking forward, we are confident that the recent acquisitions combined with our new locations will continue to fuel our top line growth and provide leverage to our cost structure."
Cash flow from operations was $40.2 million in 2015, compared to $54.2 million in 2014. This decrease in operating cash flows was primarily impacted by changes in working capital and lower net income in the current year.
Cash on hand decreased by $33.1 million due primarily to an increase in cash used for acquisition activities in 2015. As of December 31, 2014, the company had available borrowings under its revolving lines of credit of $306.5 million. ■