Trex Company, Inc. (NYSE: TREX), the world’s largest manufacturer of wood-alternative decking and railing products, today announced financial results for the first quarter ended March 31, 2012.
Net sales for the first quarter of 2012 totaled $96.1 million compared to net sales of $69.0 million for the 2011 first quarter, an increase of 39%. As described in the 2011 fourth quarter press release, the Company did not increase prices in 2012. This led to a more normal product demand in the 2012 quarter. The Company reported net income of $12.3 million, or $0.74 per diluted share, for the 2012 period compared to net income of $5.1 million, or $0.30 per diluted share, for the prior-year period. The Company’s 2011 results reflected a favorable resolution of uncertain tax positions that positively impacted income taxes by $2.6 million. Excluding that adjustment, net income in the 2011 first quarter was $2.5 million, or $0.15 per diluted share.
Chairman, President and CEO Ronald W. Kaplan commented, “Our first quarter sales were 7% above guidance. Our best-in-class product platform, combined with market share gains, helped us exceed our revenue target. Today’s results also represent the second highest first-quarter EPS performance since the Company went public in 1999.
“Demand for our 2011 new product introductions, particularly Trex Enhance™ and Trex Transcend® Porch, contributed significantly to our strong showing. Our expansion into the international arena also gained momentum, with a substantial year-over-year sales increase. Our manufacturing and productivity initiatives continued to deliver important benefits, contributing to our gross margin of 36.9%, up 350 basis points from the 2011 period.”
Mr. Kaplan concluded, “We continue to see a strong shift in the market towards ultra-low-maintenance wood alternative products. With our expanding ultra-low-maintenance product offering, utilizing Transcend technology, we are off to a great start for the year. Based on the market demand we are currently seeing, we expect net sales of approximately $90 million for the second quarter of 2012, an increase of 15% from last year’s period.”