Gibraltar Industries, Inc. (NASDAQ: ROCK) said today that it sees a continuation of the improved sales and earnings pattern, which developed in the second half of March, setting the stage for a much improved second quarter.
Gibraltar’s consolidated first quarter sales were down approximately 1.6% versus the first quarter of 2006. Influenced by a weaker than expected housing market and adverse weather conditions throughout the U.S., especially in the Midwest and Northeast, Gibraltar’s building products sales were down approximately 3.5% compared to the first quarter of 2006. The contributions of recent acquisitions and continued strength in the commercial, industrial, and architectural building markets helped dampen the effects of the more than 20% downturn in the general building market. Gibraltar’s Processed Metals Group posted a net sales increase of approximately 3.2% despite the downturn in the automotive market.
As a result, first quarter earnings are expected to be slightly below what the Company had previously communicated going into the quarter. Earnings per share from continuing operations in the first quarter of 2007 are now expected to be $.20 to $.22, compared to an earlier forecast of $.23 to $.27.
“Our business began to improve in the second half of March, a pattern which is continuing into the second quarter. We are also seeing the normal seasonal step up in business activity even in this slower housing market. We expect our results will improve considerably in the second quarter over the first with gradual improvements in the business environment anticipated as the year progresses,” said Brian J. Lipke, Gibraltar’s Chairman and Chief Executive Officer.
“Separate from the steps we have taken in response to the business slowdown, we have a number of activities underway to better position Gibraltar for improved performance over the long term,” said Henning N. Kornbrekke, Gibraltar’s President and Chief Operating Officer. “These actions will continue to enhance our core operating characteristics, which, while having an immediate impact, will become even more evident when business rebounds and our volumes return to more normal levels.”
“In spite of soft conditions in one of our major markets, we are continuing to grow the Company. We have already completed two acquisitions in 2007: Dramex Corporation (March 9) and NorWesCo/Noll Manufacturing/M&N Plastics (April 10). Both of these acquisitions, together with existing Gibraltar businesses, provide opportunities to further consolidate our product leadership position and streamline our manufacturing and distribution activities, which would enhance our margins and returns. We are also actively evaluating a number of additional internal and external growth opportunities,” said Mr. Lipke.
Gibraltar Industries is a leading manufacturer, processor, and distributor of products for the building, industrial, and vehicular markets. The company serves customers in a variety of industries in all 50 states and throughout the world. It has approximately 4,000 employees and operates 87 facilities in 26 states, Canada, China, England, Germany, and Poland. Gibraltar’s common stock is a component of the S&P SmallCap 600 and the Russell 2000® Index.
Information contained in this release, other than historical information, should be considered forward-looking, and may be subject to a number of risk factors, including: general economic conditions; the impact of the availability and the effects of changing raw material prices on the Company’s results of operations; energy prices and usage; the ability to pass through cost increases to customers; changing demand for the Company’s products and services; risks associated with the integration of acquisitions; and changes in interest or tax rates.
Gibraltar will review its first-quarter results and discuss its outlook for the second quarter during its quarterly conference call, which will be held at 9 A.M. Eastern Time on April 26. Details of the call can be found on Gibraltar’s Web site, at www.gibraltar1.com.
Gibraltar’s news releases, along with comprehensive information about the Company, are available on the Internet, at www.gibraltar1.com.
