NCI Building Systems reported financial results for the third fiscal quarter ended August 2, 2015. Sales increased 16.4% to $420.8 million from $361.6 million in last year's third quarter.
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This is largely the result of higher volumes and CENTRIA’s contribution as well as continued commercial discipline across the company.
Both the legacy single skin and insulated metal panel (IMP) businesses delivered strong results and the Buildings group delivered modest revenue growth despite the unfavorable weather in the quarter.
Gross profit increased 26.5% to $100.7 million from $79.6 million in the third quarter of 2014, and gross profit margin expanded 190 basis points to 23.9%, compared to 22.0% in the prior year period.
Excluding the fair value adjustment of acquired inventory, gross profit increased 220 basis points to 24.2%.
Contributors to the higher margins included: improved product mix with increases in insulated metal panels, enhanced lean manufacturing processes, effective supply chain management, and commercial discipline.
Adjusted operating income, a non-GAAP measure, increased 83.8% to $25.2 million in the current quarter from $13.7 million in the third quarter of 2014, driven by the expansion in sales and gross profit margin. On a GAAP basis, operating income was $19.4 million for the third quarter compared to $12.2 million in the prior year’s quarter.
Adjusted EBITDA, a non-GAAP measure, defined as earnings before interest, taxes, depreciation and amortization, and cash and other non-cash items, in accordance with the company's term loan credit agreement was $38.2 million, up 53.0% from $25 million in the prior year period.
The company reported net income of $7.2 million, or $0.10 per diluted common share, in the third quarter of 2015, which was impacted by the following after-tax charges: $0.7 million of acquisition related costs; $0.8 million of restructuring charges associated with the previously announced realignment of the management structure; and $4.3 million of noncash fair value adjustments related to the CENTRIA acquisition.
Excluding the impact of these special items, the company reported adjusted net income applicable to common shares, a non-GAAP measure, of $10.8 million, or $0.15 per diluted common share, compared to $7.1 million, or $0.10 per diluted common share, in the third quarter of 2014. ■