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Jun 30, 2021
UFP Industries Q2 2021 Earnings Report
Reported record second quarter results with net sales increasing by 117 percent and earnings increasing by 161 percent.
Key Takeaways
UFP Industries reported record second quarter results, with net sales reaching $2.7 billion, a 117% increase year-over-year, and net earnings attributable to controlling interest of $173 million, a 161% increase year-over-year. EPS also reached a record $2.78 per diluted share. Recent acquisitions contributed significantly to net sales and EPS.
Net sales increased 117 percent to $2.7 billion, driven by higher selling prices and unit growth from acquisitions and organic sales.
Earnings from operations increased 157 percent to $236.9 million, including the impact of an inventory valuation reserve.
Adjusted EBITDA increased 137 percent, with the adjusted EBITDA margin expanding by 80 basis points to 9.7 percent.
The company maintains a strong balance sheet with liquidity of approximately $288 million, despite increased investment in net working capital.
UFP Industries
UFP Industries
UFP Industries Revenue by Segment
Revenue by Segment
Retail Revenue
CapyFin.comConstruction Revenue
CapyFin.comAll Other Revenue
CapyFin.com Forward Guidance
UFP Industries expects market conditions to normalize during the second half of 2021. While falling lumber prices and more normalized demand create challenging year-over-year profitability comparisons for our retail segment, the stabilized lumber market should benefit our industrial and construction segments. Furthermore, they expect all of our segments to benefit from more stable pricing in 2022.
Positive Outlook
- Expects market conditions to normalize during the second half of 2021.
- Stabilized lumber market should benefit industrial and construction segments.
- All segments are expected to benefit from more stable pricing in 2022.
- Industrial and retail segments should continue to benefit from the integration of recent acquisitions.
- Anticipates that as lumber prices and seasonal demand normalize, the increase in net working capital will be converted to cash.
Challenges Ahead
- Falling lumber prices create challenging year-over-year profitability comparisons for the retail segment.
- More normalized demand creates challenging year-over-year profitability comparisons for the retail segment.
- Increase in our seasonal investment in net working capital of $444 million, which resulted from unprecedentedly high lumber prices and market demand.
- Net debt increased to $562 million from a net cash position of $37 million at the end of the second quarter of 2020, primarily due to these factors and the acquisitions of PalletOne and Spartanburg Forest Products.
- Fluctuations in the price of lumber
Revenue & Expenses
Visualization of income flow from segment revenue to net income