Fortune Brands Home & Security, whose brands include Simonton Windows, Fypon, Moen, Kitchen Craft Cabinetry and Omega Cabinetry, saw first-quarter profits jump to $12.5 million from the year-ago period’s loss of $10.5 million, the company announced Thursday. Net sales grew by nearly 12% for the same period to hit $798.8 million, representing a recovery driven largely by increased spending on remodeling and home repairs, company representatives said in a statement.
Among the Deerfield, Ill.-based company’s product segments, operating income it its Kitchen & Bath Cabinetry division garnered first quarter losses of $5.3 million, compared with a $2 million loss from the year-ago period. However, the Plumbing & Accessories division boasted a 41% operating gain over the first quarter of 2011 to total $36.2 million. The company’s windows and doors segment jumped 39% in operating dollars during the first quarter from the year-ago period, albeit recording a loss of $8.5 million.
The failure of the cabinet segment to show an operating gain is likely thanks to consumer reluctance to spend on bigger-ticket items, Fortune Brands CEO Chris Klein said in a statement. Yet he credits the operating profits in other segments and the overall increase in revenues to stronger-than-expected new-construction rates for the quarter, which includes multi-family starts. While milder weather “likely played a part” in the quarter’s performance, Klein says that growth was also visible in areas not affected by warmer, drier temperatures.
Net sales across the segments grew during the first quarter, with the cabinetry division seeing the smallest increase at 3.9% from the year-ago quarter; the category’s total of $311.5 million comprised 39% of the company’s total net sales. Plumbing & Accessories net revenues leapt 20% to $244.5 million over the year-ago period, driven by the U.S. wholesale and international markets, particularly China.
Overall, operating income saw a 57% gain from the first quarter of 2011 to hit $21.3 million for the current period. The company also raised its full-year outlook, spurred by its first-quarter performance and the anticipated momentum of tis U.S. home products market, Klein said.
