Beacon Roofing Supply, Inc. (the "Company") (NASDAQ: BECN) announced results today for its first quarter ended December 31, 2014 (“2014”) of the fiscal year ended September 30, 2014 (“Fiscal 2014”).
Paul Isabella, the Company’s President and Chief Executive Officer, stated: “We again achieved solid top line growth for the quarter. We started the quarter exceptionally strong, but ended the month of December on a soft note as a result of some very challenging weather conditions in our Northern regions. We were very pleased to see a strong rebound in commercial roofing this quarter as we continue to focus on diversifying our lines of business. In addition, we are seeing success with our new branch opening process and believe we will exceed our initial targets and may open as many as 25 branches in Fiscal 2014. A challenging pricing environment continued to drive down gross margins again this quarter, although our long standing culture of cost control was able to mitigate some of the negative impact through leverage of our operating expenses. Despite the challenges with pricing, we continued to generate solid cash flows from operations and fully repaid our revolving credit facility during the quarter. We believe market pricing will improve in 2014 as demand increases as we exit the winter months, and we intend to continue to leverage our operating expenses as we grow our revenue base.”
Total sales increased 7.5% to $552.1 million in 2014 from $513.7 million in 2013. Existing market (organic) sales, which exclude branches acquired after the beginning of last year’s first quarter, increased 3.3% (the first quarter of 2013 and 2014 both had the same number of business days). In existing markets, residential roofing product sales increased 1.4%, non-residential roofing product sales increased 6.6%, and complementary product sales increased 1.0%.
Net income for the first quarter was $15.0 million compared to $18.2 million in 2013. First quarter diluted net income per share was $0.30 compared to $0.37 in 2013. Net income for the quarter was unfavorably impacted by lower gross margins driven primarily by lower average selling prices for our residential and non-residential products and a higher mix of non-residential roofing products. This was partially offset by a lower rate of operating expenses and lower effective tax rate.
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