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Mar 31, 2020
Northwest Pipe Q1 2020 Earnings Report
Reported a net sales increase driven by the acquisition of Geneva Pipe Company, with gross profit also increasing due to improved product pricing and Geneva's margin contribution. Net income decreased, but adjusted net income showed a positive result after excluding acquisition-related costs and other non-recurring items.
Key Takeaways
Northwest Pipe Company announced first quarter 2020 financial results with net sales increasing by 10.0% to $68.9 million compared to the first quarter of 2019. Gross profit increased by 45.8% to $9.6 million. Net income was $0.6 million, or $0.06 per diluted share, while adjusted net income was $3.2 million, or $0.33 per diluted share.
U.S. plants continued to operate amidst the COVID-19 pandemic.
Gross profit increased 45.8% year-over-year.
Net income was $0.06 per diluted share; adjusted net income was $0.33 per diluted share.
Backlog was strong at $170 million, and $224 million including confirmed orders.
Northwest Pipe
Northwest Pipe
Northwest Pipe Revenue by Segment
Revenue by Segment
Engineered Steel Pressure Pipe Revenue
CapyFin.com Forward Guidance
The COVID-19 pandemic has had a major impact on society and the economy. The company continues to operate all of its plants with the exception of the San Luis Río Colorado facility in Mexico which the Mexican government required them to temporarily close. Before purchase accounting associated with the acquisition of Geneva, first quarter revenue and margins were in-line with projections. Steel pressure pipe backlog remains very elevated. The order book for the concrete pipe and precast business is very strong as they head into the traditionally busy time of the year.
Positive Outlook
- Plants deemed essential and continue to operate amidst COVID-19.
- More than enough capacity at remaining plants to absorb current and future orders.
- First quarter revenue and margins were in-line with projections.
- Steel pressure pipe backlog remains very elevated by historic standards.
- Order book for the concrete pipe and precast business is very strong.
Challenges Ahead
- COVID-19 pandemic has had a major impact on society and the economy.
- San Luis Río Colorado facility in Mexico was temporarily closed.
- Purchase accounting associated with the acquisition of Geneva affected results.
- Steel pressure pipe backlog declined as projected.
- Acquisition-related charges impacted gross profit.