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Dec 31, 2019
Owens Corning Q4 2019 Earnings Report
Owens Corning reported a decrease in net sales and earnings for the fourth quarter of 2019, but delivered record revenues and operating cash flow for the full year.
Key Takeaways
Owens Corning reported Q4 2019 consolidated net sales of $1.7 billion, a decrease of 2% compared to the same period in 2018. Net earnings attributable to Owens Corning were $73 million, or $0.66 per diluted share, compared to $171 million, or $1.55 per diluted share, in Q4 2018. Adjusted earnings were $125 million, or $1.13 per diluted share, compared to $152 million, or $1.38 per diluted share, during the same period one year ago. Full-year 2019 net sales were $7.2 billion and operating cash flow was $1 billion.
Consolidated net sales for Q4 2019 were $1.7 billion, a 2% decrease compared to Q4 2018.
Net earnings attributable to Owens Corning for Q4 2019 were $73 million, or $0.66 per diluted share, compared to $171 million, or $1.55 per diluted share, in Q4 2018.
Adjusted earnings for Q4 2019 were $125 million, or $1.13 per diluted share, compared to $152 million, or $1.38 per diluted share, in Q4 2018.
The company generated free cash flow of $590 million for the full year 2019, an increase of over $300 million from 2018.
Owens Corning
Owens Corning
Owens Corning Revenue by Segment
Revenue by Segment
Roofing Revenue
CapyFin.comInsulation Revenue
CapyFin.com Forward Guidance
The company's outlook is based on an environment consistent with consensus expectations for global industrial production, U.S. housing starts, and global commercial and industrial construction indices.
Positive Outlook
- Favorable market outlook for U.S. new residential construction in Insulation.
- Modest growth in global construction and industrial markets in Insulation.
- Strong earnings growth primarily driven by volume growth and operating leverage in the North America residential fiberglass insulation business.
- Continued earnings improvement in the technical and other building insulation businesses.
- Weaker glass fiber market in the first-half of the year which is expected to strengthen in the second-half, consistent with global industrial production in Composites.
Challenges Ahead
- Relatively flat U.S. shingle industry shipments, assuming average storm demand in Roofing.
- The impact of the newly effective International Maritime Organization (IMO) 2020 regulations on marine sector emissions is not currently expected to have a significant impact on asphalt costs for the business.
- The company estimates an effective tax rate of 26% to 28%, and a cash tax rate of 10% to 12% on adjusted pre-tax earnings, which is due to the company’s foreign tax credit carryforwards.
- The company expects general corporate expenses of $125 million to $135 million.
- Capital additions are expected to be in line with depreciation and amortization of approximately $460 million. Interest expense is expected to be approximately $115 million.
Revenue & Expenses
Visualization of income flow from segment revenue to net income