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Posted August 5, 2020

Huttig Building Products announces Q2 2020 results

Net sales for quarter dip just 12.1 percent YOY, due to the pandemic.


Second Quarter 2020 Highlights (as compared to prior year quarter):

  • Net sales decreased 12.1% to $192.0 million
  • Gross margin of 20.2% compared to 20.3%
  • Operating income of $2.5 million, net of $1.5 million restructuring charge. Operating income before restructuring charge was $4.0 million compared to $3.3 million.
  • Adjusted EBITDA of $5.7 million compared to $5.1 million
  • Total liquidity increased to $56.0 million compared to $39.6 million a year ago
  • Reduced senior indebtedness by $32.2 million compared to a year ago

Huttig Building Products, Inc., a leading domestic distributor of millwork, building materials and wood products, today reported financial results for the second quarter ended June 30, 2020, and provided a business update on its response to the COVID-19 pandemic.

“In light of all of the economic uncertainty caused by the COVID-19 pandemic, I am pleased with our financial performance in the second quarter,” said Jon Vrabely, Huttig’s President and Chief Executive Officer. “We acted early, decisively, and aggressively to adjust our cost structure and inventory levels to mitigate the threat to the company posed by the pandemic. I am very proud of all of our associates for the dedication, hard work, and personal sacrifices that have been made on behalf of our stakeholders. Moving forward, we remain committed to continuing to take the necessary actions to protect our associates and diligently manage the business as the external environment continues to change.”

Results of Operations

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019

As anticipated, the impact of the COVID-19 pandemic negatively affected our net sales, although our COVID-19 readiness and response plan has driven an overall improvement in our operating results relative to our initial pandemic forecasts.

Net sales were $192.0 million in the second quarter of 2020, which was $26.5 million, or 12.1%, lower than the second quarter of 2019. The decline was caused primarily by the changes to the operating environment resulting from the pandemic. While some of our largest markets were significantly impacted by the pandemic early in the second quarter, demand has improved as construction activity has rebounded.

Revenues were lower in all three of our product classifications, with varying levels of pandemic-related supply chain disruption across product lines.

Millwork product sales decreased 17.9% in the second quarter of 2020 to $81.7 million, compared to $99.5 million in the second quarter of 2019; building products sales decreased 3.6% in the second quarter of 2020 to $97.5 million, compared to $101.1 million in the second quarter of 2019; and wood product sales decreased 28.5% in the second quarter of 2020 to $12.8 million, compared to $17.9 million in the second quarter of 2019.

Millwork sales were most impacted by the disruption of our supply chain. Building product sales were more resilient as certain product lines within this category retained relatively consistent high levels of demand. The decline in wood product sales also reflected our decision to de-emphasize certain product lines within the category.

Gross margin was $38.7 million in the second quarter of 2020, compared to $44.3 million in the second quarter of 2019. As a percentage of sales, gross margin was 20.2% in the second quarter of 2020, compared to 20.3% in the second quarter of 2019. Gross margins were negatively impacted by a shift in sales mix reflecting higher proportionate sales of lower margin categories and direct sales.

Learn more at www.huttig.com.

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