Encore Wire Corporation (WIRE)
Q2 2012 Earnings Conference Call
July 26, 2012 11:00 AM ET
Daniel L. Jones – President and Chief Executive Officer
Frank J. Bilban – Vice President and Chief Financial Officer
Anthony Kure – KeyBanc Capital Markets Inc.
Tom Brashear - Preston Capital Management
Joe Giamichael – Global Hunter Securities, LLC
Brian Gibson - Edward Jones
Robert Kelly - Sidoti & Co.
Hello and welcome to the Encore Wire’s Second Quarter Earnings Call. Throughout the call, all participants will be in listen-only-mode. There will be question-and-answer session at the end of the call. I am pleased to present the Daniel Jones, President and Chief Executive Officer of Encore Wire. Please begin the meeting.
Thank you, Chris, and good morning ladies and gentlemen, and welcome to the Encore Wire Corporation quarterly conference call. As mentioned, I'm Daniel Jones, the President and Chief Executive Officer of Encore Wire. And with me this morning is Frank Bilban, our Chief Financial Officer, and a few other members of our management team. The second quarter of this year was another fairly steady volume quarter in the midst of the industry recession. There are signs of bright spots around the country and talk of some major projects. The projects are discussed, but then get delayed due to all the uncertainty surrounding the global economy and political environment.
The good news is that our volumes are not trending downward. We believe our expansion of product offerings over the last six years to our existing customer base has been critical to maintaining and boosting our market share. As we have repeatedly noted, one of the key metrics to our earnings is the spread between the price of copper wire sold and the cost of raw copper purchased in any given period. The spread decreased 10% in the second quarter of 2012 versus the second quarter of 2011, while our unit volume shipped in the second quarter of 2012 decreased 4% versus the second quarter of 2011. We believe the slight volume drop is due more to our attempts to lead or maintain pricing levels in the industry, while not taking some lower margin orders than anything else.