Beacon Roofing Supply's net income nearly doubled to $31.3 million in its fiscal fourth quarter ended Sept. 30, in part from a $5.1 million one-time tax benefit but mainly from a 19.3% rise in total sales to $575.6 million, the company announced today.
Storms, product price increases, and smart buying all helped contribute to the record numbers, president and CEO Paul Isabella said. For all of fiscal 2011, net income at the Peabody, Mass.-based firm shot up 71.5% to $59.2 million on a 12.9% gain in sales to $1.82 billion.
Beacon, the No. 3 company on this year's ProSales 100, noted that sales rose 15.6% at the branches it has operated for at least one year. Sales of residential products climbed 25.7% from the July-September 2010 quarter while non-residential roofing sales jumped 10.8% in the quarter. Complementary product sales slipped 1%. The company's gross product margin edged up to 23.1% from a year-earlier 22.0%.
"Our roofing businesses have benefited both from a pick-up in volume, including some storm business, and from industry-wide price increases mostly during the second half of the year," Isabella said. "Our commercial business has remained consistently strong throughout this year. We were able to use our strong financial position to increase inventories ahead of some vendor price increases, which enabled us to achieve gross margins that were significantly above last year's rates. We continued to exercise prudent expense controls to further improve our operating margin and our cash holdings have increased since last year even after this year's third-quarter purchase of Enercon Products. We continue to aggressively seek quality companies that fit our target acquisition profile, such as Denver-based Fowler & Peth acquired in the first quarter of fiscal 2012. We believe there are many favorable long-term growth factors in our industry, so we expect to continue expanding our geographic reach in 2012."
The company also measured itself in terms of adjusted EBITDA--earnings before interest, taxes, depreciation, amortization, and stock-based compensation. By that yardsticks, adjusted EBITDA for the quarter rose 42.5% to $55.4 million.
For the full fiscal year ended Sept. 30, sales at existing markets rose 9.3% in part because there were more business days than in fiscal 2010; using the same number of business days, sales rose 8.8%. Sales in existing markets for residential products climbed 8.8%, while for non-residential products they grew 12.8% above fiscal 2010 levels. Complementary product sales inched up 1.7%. Adjusted EBITDA rose 26.9% to $134.9 million.
Cash flow from operations rose to $79.3 million in fiscal 2011 from $73.9 million, while cash on hand jumped 22.1% to $143 million.
The company's balance sheet declared $1.16 billion worth of assets, of which roughly one-third ($380.9 mlliion) was goodwill.
Beacon now operates 194 branches in 38 states in the United States and across Canada.