A slowdown in re-roofing activity and increased costs due to a suite of acquisitions in late 2012 kept Beacon Roofing Supply from improving on its year-earlier bottom-line gains as profits fell 4.7% to $18.2 million for the first quarter of the fiscal year ending Sept. 30. This, as sales rose 4.8% to $513.7 million for the same period.
The Peabody, Mass.-based specialty roofing distributor said its 19 acquisitions during the quarter—which cost the company approximately $64.5 million—contributed to a 13.8% increase in quarterly operating costs from a year earlier, totaling $94.5 million for the period. The company ended the quarter with $47.3 million in cash, compared to $58.9 million a year earlier.
"Our total sales benefited from the positive impact of several acquisitions made since the start of last year and our gross margin continued to improve over the prior year," Beacon CEO Paul Isabella said in a statement Friday. "We believe we are well positioned for a successful fiscal 2013 and expect to continue our steady growth. We continue aggressively to seek quality companies that fit our target acquisition profile."
Beacon, third on the 2012 ProSales 100 listing with $1.9 billion in sales to pro dealers last year, is coming off an active quarter in which it entered the Pacific Northwest while bringing another East Coast competitor into its portfolio. In December, the company moved into Northern California with the purchase of 3-unit residential and commercial roofing distributor Ford Wholesale Co. and roofing supplier Construction Materials Co., which has two locations in the region. The move came two months after Beacon purchased 14-unit specialty roofing distributor McClure-Johnston, which reported average annual sales of $85 million from its operations in Georgia, Maryland, Pennsylvania, and West Virginia.
The company grew its net income by 27.5% during its fiscal year ended Sept. 30, 2012, it reported in November. Sales rose 12.4% to $2.04 billion for the same period. At the close of FY 2012, Beacon reported 224 locations in 38 U.S. states and six Canadian provinces.