Trex Company, Inc. (NYSE: TREX), the world’s largest manufacturer of wood-alternative decking and railing products, today announced financial results for the second quarter ended June 30, 2012.
Net sales for the second quarter of 2012 totaled $94.3 million compared to net sales of $78.4 million for the 2011 second quarter, an increase of 20%. The Company reported net income of $8.3 million, or $0.48 per diluted share, for the 2012 period compared to net income of $2.1 million, or $0.12 per diluted share, for the prior-year period. During the second quarter of 2012, the Company recognized a $1.1 million increase to its warranty reserve for decking material manufactured at its Nevada plant prior to 2007 and $0.7 million of severance charges. Before giving effect to these charges, net income was $10.1 million, or $0.59 per diluted share.
For the six months ended June 30, 2012, the Company reported net sales of $190.4 million compared to net sales of $147.4 million for the prior-year period, an increase of 29%. The Company reported net income of $20.7 million, or $1.22 per diluted share, for the first six months of 2012 compared to net income of $7.2 million, or $0.42 per diluted share, for the 2011 period. For the first six months of 2012, the Company recognized a $1.5 million increase to the warranty reserve and $0.7 million of severance charges. The Company’s 2011 results included the favorable resolution of an uncertain tax position in the first quarter that positively impacted income taxes by $2.6 million. Before giving effect to these items, net income for the 2012 period was $22.8 million, or $1.34 per diluted share, compared to $4.6 million, or $0.27 per diluted share, for the 2011 period.
Chairman, President and CEO Ronald W. Kaplan commented, “Our strong second-quarter results once again demonstrate that we are successfully executing our strategy. Our many recent innovative ultra-low-maintenance product introductions, including Trex Enhance®, Trex Transcend® Porch and Trex Elevations™, contributed to our performance. We are very pleased with the results of the ‘good, better, best’ decking platform strategy we launched in 2011, giving consumers a variety of options for creating their ideal outdoor living space.
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