Stock Building Supply reported $5.1 million in fourth quarter 2013 operating income, compared with a $5.2 million operating loss in the year-ago quarter. Net income came to $3 million in the quarter compared with a $3.8 million loss in the fourth quarter of 2012.
For the full 2013, operating income came to $800,000, compared with 2012’s operating loss of $18.9 million. However, the Raleigh, N.C.-based dealer logged a net loss of $4.6 million in 2013, an improvement over the $14.5 million loss in 2012. The net loss was impacted by $10 million related to the company’s initial public offering in the third quarter last year.
Net sales for the quarter were up 21% in the fourth quarter to $305.2 million from $252.1 million in the final quarter of 2012. Full-year net sales totaled $1.2 million, a 27% increase over 2012 net sales of $942.4 million. The company says net sales increased 19.6% due to increased volume and 7.4% due to increased selling prices. The increase in sales volume was primarily driven by increased single-family housing starts and increased demand arising from higher remodeling activity.
"During the fourth quarter of 2013, the U.S. housing industry continued its recovery and our business delivered strong revenue growth and profit improvement,” says CEO Jeff Rea. “Over the course of 2013, our net sales to single-family homebuilders grew nearly 31% and our net sales to remodeling contractors increased over 18%.”
Stock’s custom builder sales grew from 35% to 37% in 2013, while production builder sales remained flat at 37%. Remodeling contractor sales rose from 17% to 18%.
Rea says Stock continued to focus on the remodeling segment last year by embarking on strategic and tactical investment in local facilities to better serve professional remodeling customers. Stock refreshed design centers and in-store merchandising in several Los Angeles, Houston, Salt Lake City, and Washington D.C. locations.
“We feel significant growth opportunities remain as our sales to remodeling contractors of approximately $200 million is only a small fraction of the estimated $81 billion of opportunity in the U.S. professional home improvement marketplace,” Rea says.
Last year, Stock acquired Total Building Services Group, a supplier of structural components and architectural millwork in Atlanta, and Chesapeake Structural Systems in Charles City, Va., to provide structural components in the Richmond and Northern Virginia markets.
The company saw a 48% increase in its structural components business plans to expand offerings in Utah and the Carolinas to service growing demand in those markets. Stock also opened a millwork plant in South Carolina to provide product and service to Charlotte and South Carolina, and increased its millwork capability in the Houston market.
“As we look forward to 2014, we remain optimistic about the prospects for further recovery as the U.S. single-family new construction market is still nearly 40% below the 50-year average of a million starts,” Rea says. “Therefore our near terms growth strategy remains the same and is designed to ensure that our company is well-positioned to take advantage of the recovery in U.S. residential construction.”