Free Research Report as NCI's Sales Advanced 8.7%
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LONDON, UK / ACCESSWIRE / July 5, 2018 / If you want access to our free earnings report on NCI Building Systems, Inc. (NYSE: NCS) (“NCI”), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=NCS. The Company reported its second quarter fiscal 2018 operating and financial results on June 05, 2018. The maker of products used in commercial buildings outperformed top- and bottom-line expectations. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For the second quarter of the fiscal year 2018, NCI's sales increased 8.7% to $457.1 million, up from $420.5 million in Q2 FY17, primarily driven by a continued commercial discipline in the pass-through of higher material costs across the Company's segments. NCI's revenue numbers beat analysts' estimates of $443.0 million.
During Q2 FY18, NCI's gross profit rose 3.2% to $104.1 million compared to $100.8 million in Q2 FY17. The Company's gross profit margin was 22.8% in the reported quarter compared to 24.0% in the prior year's same quarter. NCI's gross margin for Q2 FY18 was lower on a y-o-y basis, primarily as a result of a less favorable product mix in the IMP segment and incremental manufacturing costs in the Metal Coil Coating segment.
For Q2 FY18, NCI's engineering, selling, general, and administrative (ESG&A) expenses were $74.4 million compared to $75.1 million in Q2 FY17. The Company's ESG&A expenses as a percentage of revenues were 16.3% in the reported quarter versus 17.9% in the prior year's comparable quarter.
NCI's operating income was $19.0 million in Q2 FY18, including a $6.7 million charge related to the sale of CENTRIA's manufacturing facility in China, compared to an operating income of $32.5 million in Q2 FY17. The Company's adjusted operating income rose 15.3% to $27.3 million in the reported quarter compared to $23.6 million in the year earlier corresponding quarter.
For Q2 FY18, NCI's net loss applicable to common shares was $5.7 million, or $0.09 loss per diluted common share, compared to a net income of $16.9 million, or $0.24 per diluted common share, in Q2 FY17. The Company's results for the reported quarter were impacted by a $21.9 million charge related to the extinguishment and refinancing of a portion of the Company's debt; a $6.7 million charge on the disposition of CENTRIA's China operations; a $1.1 million charge for strategic development and acquisition related costs; and $0.5 million of restructuring and impairment charges.
NCI reported an adjusted net income of $16.4 million, or $0.25 per diluted common share, in Q2 FY18 compared to $11.5 million, or $0.16 per diluted common share, in Q2 FY17; which was ahead of Wall Street's estimates of $0.18 per share. The Company's adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) were $39.7 million in the reported quarter compared to $37.0 million in the prior year's same quarter.
Segment Performance
During Q2 FY18, NCI's Engineered Building Systems segment's sales were $167.2 million compared to $162.6 million in Q2 FY17, primarily as a result of commercial discipline passing through higher input costs. The segment's operating income surged 34.5% to $9.3 million in the reported quarter versus $6.9 million in the prior year's comparable quarter, while its adjusted operating income advanced 32.3% to $9.6 million in Q2 FY18 compared to $7.2 million in Q2 FY17.
For Q2 FY18, NCI's Metal Components segment generated sales of $168.5 million, reflecting an increase of 8.8% from $154.9 million in Q2 FY17, which was led by higher external volumes across the segment and the disciplined pass-through of increasing input costs. The segment's operating income was $22.1 million in the reported quarter compared to $20.0 million in the year earlier corresponding quarter; while its adjusted operating income was $22.2 million in Q2 FY18 compared to $19.7 million in in Q2 FY17. The segment's operating margin increased as a result of an improved operating leverage on higher volumes.
During Q2 FY18, NCI's IMP segment generated sales of $113.4 million, up 10.2% compared to $102.9 million in Q2 FY17, as a result of commercial discipline emphasizing project profitability over volume in a period of increasing input costs. The segment's operating income was $1.5 million in the reported quarter compared to $19.4 million in the prior year's same quarter. The segment's adjusted operating income came in at $8.4 million in Q2 FY18 compared to $10.4 million in Q2 FY17.
For Q2 FY18, NCI's Metal Coil Coating (MCC) segment's sales gained 9.8% to $95.2 million compared to $86.7 million in Q2 FY17, as a result of higher volumes in package sales and the pass-through of rising material costs. The segment's operating income and adjusted operating income were both $7.1 million in the reported quarter versus $6.2 million in the year earlier comparable quarter.
Cash Matters
NCI's cash and cash equivalents were $35.3 million at the end of Q2 FY18 compared to $49.7 million at the end of Q2 FY17. As of April 29, 2018, the Company's $150.0 million asset-based lending (ABL) facility remained undrawn.
Outlook
For the third quarter of the fiscal year 2018, NCI is forecasting revenues to be in the range of $525 million to $545 million, and adjusted EBITDA to be in the band of $56 million to $66 million.
Stock Performance Snapshot
July 02, 2018 - At Monday's closing bell, NCI Building Systems' stock declined 1.17%, ending the trading session at $21.05.
Volume traded for the day: 103.02 thousand shares.
Stock performance in the last month – up 10.21%; previous three-month period – up 18.93%; past twelve-month period – up 21.33%; and year-to-date – up 9.07%
After last Monday's close, NCI Building Systems' market cap was at $1.38 billion.
Price to Earnings (P/E) ratio was at 42.27.
The stock is part of the Industrial Goods sector, categorized under the General Building Materials industry. This sector was flat at the end of the session.
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