UFP sales, profits fall

GRAND RAPIDS–UFP Industries Inc. (Nasdaq: UFPI), the Grand Rapids-based construction materials manufacturer, announced first quarter net income of $120.8 million or $1.96 a share, down from $126.1 million or $1.98 a share in the first quarter of 2023.

Revenue was $1.64 billion, down from $1.82 billion a year earlier.

“We would like to credit our hard-working team and our balanced business model for allowing us to achieve first-quarter results that were in line with expectations,” said Chairman and CEO Matthew J. Missad. “As demand returns to more normalized levels, we are increasingly focused on improving our operational efficiencies by investing in automation and technology while consolidating operations where opportunities exist. We are also investing in growth through new products and by adding additional capacity in new regions. In addition, we will continue to leverage our strong cash flow and liquidity position to increase our share repurchase activity and support our quarterly dividend payouts. Our ability to invest in growth and return capital to shareholders supports our goal to create shareholder value during any economic environment.”

The revenue decrease was due mostly to falling selling prices and a 1 percent decline in organic unit sales. New product sales of $124 million were 7.6 percent of total sales, up from 7.4 percent in the first quarter of 2023.

Company officials said UFP continues to pursue strategic acquisitions that drive long-term growth and margin improvements and offer strong returns. When acquisition targets are not available at valuations that allow it to meet or exceed its hurdle rates, the company will invest in organic growth. The company is targeting capital investments of up to $300 million in 2024, with approximately $100 million targeted for automation and technology upgrades and another $100 million for new facilities and increased capacity at existing facilities.

By business segment, UFP Retail Solutions reported $629 million in sales, down 17 percent from the first quarter of 2023, the product of lower demand for wood products and more conservative inventory practices by retailers. UFP packaging reported sales of $424 million, down 13 percent from the year earlier quarter. UFP Construction reported sales of $518 million, unchanged from a year earlier.

Company officials said they expect lumber prices to “remain at lower, more historical levels in 2024,” and that demand may slacken based on federal interest rate cuts being put off.

To listen to a conference call discussing these results, visit  www.ufpinvestor.com/news-filings-reports.

UFP Industries is a holding company whose operating subsidiaries–UFP Packaging, UFP Construction and UFP Retail Solutions–manufacture, distribute and sell a wide variety of products used in residential and commercial construction, packaging and other industrial applications worldwide. Founded in 1955, the company is headquartered in Grand Rapids, with affiliates in North America, Europe, Asia and Australia. More at www.ufpi.com.

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