Powered by a 32% jump in revenues to $190 million, Temple-Inland Inc.'s building products segment swung to a $15 million operating profit in the second quarter from a year-earlier $3 million loss, the company announced today.
"Building Products operating results improved in second quarter 2010 compared with first quarter 2010 [when the operating loss was $9 million] due to higher prices and volumes for all our products," Austin, Texas-based Temple-Inland said in a statement. "Operating results improved in second quarter 2010 compared with second quarter 2009 due to higher lumber prices and higher volume for all our products."
Roughly $71 million of the $190 million in building products sales involved lumber, up from $45 million in 2009's second quarter. The rest came from gypsum wallboard ($40 million in this year's second quarter vs. $33 million a year earlier), particleboard ($38 million vs. $35 million), medium-density fiberboard ($21 million vs. $15 million), other types of fiberboard ($9 million vs. $7 million), and all other products ($11 million vs. $9 million).
Good as that segment was, it wasn't enough to overcome a 30.7% drop in income for the corrugated packaging segment to $63 million. That decline, attributed to higher input costs, came despite a 3.1% increase in corrugated packaging revenues to $786 million.
As a result, net income for the quarter attributable to Temple-Inland shrank by more than two-thirds to $20 million from $66 million in the April-June 2009 period.
"In building products, we returned to solid profitability in the quarter," chairman and chief executive officer Doyle R. Simons said. "In addition to higher prices, we benefited from our low cost structure. ... Looking ahead, we are positioned for a strong second half of the year in corrugated packaging as we will benefit from higher prices, box plant transformation and less mill maintenance downtime. Housing markets remain challenging, but we are well positioned in our building products business."