Trex Company, Inc. (NYSE:TREX), the world’s largest manufacturer of wood-alternative decking and railing products, today announced financial results for the fourth quarter ended December 31, 2013.
Net sales for the fourth quarter of 2013 totaled $63.8 million compared to net sales of $46.2 million for the 2012 fourth quarter, an increase of 38%. The Company reported net income of $15.1 million, or $0.90 per diluted share, for the 2013 period compared to a net loss of $3.6 million, or $0.22 per diluted share, for the prior-year period. During the 2013 period, the Company recognized a non-cash $10.9 million favorable income tax adjustment. During the 2012 quarter, the Company recognized a $1.5 million provision for costs related to the mold class action. Before giving effect to these adjustments, fourth-quarter 2013 net income was $3.9 million, or $0.23 per diluted share, while fourth-quarter 2012 net loss was $2.1 million, or $0.13 per diluted share.
“We brought 2013 to a very strong finish,” said Chairman, President and CEO Ronald W. Kaplan. “Expanded distribution and dealer demand across the country contributed significantly to sales and are helping us advance a key initiative – increasing market share. Our best-in-class high-performance product platform, coupled with our recently revised pricing strategy, is being well received in the marketplace. Our robust sales increase fell to the bottom line, producing an impressive $6.0 million improvement over underlying net income in the 2012 quarter.
“For the full year ended December 31, 2013, net sales totaled $343 million, an increase of 11% over 2012 and higher than the market growth for the year. An improving economy and the markets’ favorable response to our realigned ‘good, better, best’ high-performance decking and railing product platforms were among the key drivers. Underlying gross margin for the year was 34.9%, 40 basis points favorable to 2012. Excluding the $4.5 million LIFO inventory liquidation income realized in 2012, 2013 underlying gross margin was up 185 basis points. Underlying net income for 2013 was $48.2 million or $2.81 per share, an 82% increase over 2012.