Universal Forest Products Inc. (UFPI) dipped into the red from the same period last year, with an almost $1.1 million net loss during the fourth quarter, the company revealed today. Net sales for the period rose 11% to $422 million at the Grand Rapids, Mich.-based wood and composite building material manufacturer.
The slide into the red was due to $2.7 million in noncash impairment charges for closed facilities. Results for 2010 were also affected by a $2.3 million noncash tax benefit which resulted from removing a valuation allowance against a deferred tax asset.
“We are encouraged by the sales growth in the fourth quarter as well as the impact of our cost reductions on our bottom line,” said Matthew Missad, CEO of UFPI.
For the year, net earnings fell 70% to just under $6 million. The numbers were driven by a 4% slip in sales to $1.82 billion and a 13% decline in gross profits, which finished at $199.7 million.
In segment news, UFPI’s residential construction unit saw fourth-quarter sales fall 19% from the same period a year ago to $46.6 million. The company said plant closures and its focus on accepting only business that will enhance its bottom line. For the year, the unit reported sales of $203.2 million, down almost 16% from 2010.
The retail building materials segment posted fourth-quarter sales of $165.3 million, an 8% growth from the same quarter last year. Year-end results revealed an 8% decline in net sales to $839 million. The manufacturer said it focused on adding a broader mix of products and attracting more independent retail customers into the segment during the quarter.
Net sales at UFPI’s manufactured housing unit rose 35% to $67.3 million in the fourth quarter. Demand from FEMA and orders for temporary housing in markets driven by oil and gas drilling helped to fuel the growth. For the year, sales dipped just over $1 million to $244.7 million.
The commercial construction and concrete forming segment reported fourth-quarter sales of $20.9 million, up from the $17.7 million posted a year ago. Results for 2011 were $77.5 million, a 14% improvement from 2010.
Sales in the industrial packaging segment, which saw industry production rise 3% between fourth quarter 2010 and 2011, were $128.6 million, a 22% jump from the year earlier period. Net sales hit $493 million for the year, a 9% improvement over the year prior.
“We have the business model we need for growth and a strong capital structure to fund our growth,” said Missad. “Most importantly, our people are energized and eager to achieve our goals.”