Simpson Manufacturing, the parent company of Simpson Strong-Tie, did an about-face during the fourth quarter, going from a $4.5 million net loss a year ago to $4.9 million in income, the company announced today. Net sales at the Pleasanton, Calif-based company improved 9% to $130.7 million as gross profit also rose 15% to $54.9 million for the quarter ended Dec. 31.
The company said fourth quarter sales increased throughout North America and most of its European markets. “Sales increased in all regions of the United States, with above-average increases in California and the western regions, as compared to the fourth quarter of 2010,” said the company. Sales to contractor distributors, dealer distributors, lumber dealers, and home centers also increased during the quarter.
Gross margins improved to 42% from 40% a year ago, driven mainly by lower manufacturing costs, which included lower factory overhead costs and partially offset by increased costs of material and labor. The manufacturer also increased research and development and engineering expense by 24%, to $6.1 million, during the quarter.
For the year, net income rose 78% to $50.9 million. This year’s net income was bolstered by a $4.4 million income in equity method investment before taxes, while last year’s results featured a $16.2 million loss from discontinued opertions.
Net sales for the year grew 8% to $603.4 million as gross profits jumped over $25 million to $270.8 million.
Year-end results also reflect an increase in sales throughout most of North America and most of Europe, with the southeastern U.S. recording above-average increases. Gross margins increased slightly, from 44% in 2010 to 45% in 2011, driven by lower factory overhead costs.
In 2011, the company repurchased 1.9 million shares of its common stock, at a total cost of $53.2 million, as part of a $100 million share repurchase authorization. For 2012, the board of directors authorized the repurchase of up to $50 million in common stock.