Boosted by record gross profit margins, construction supply company Ply Gem Holdings posted better-than-expected net income in the second quarter despite sales that fell short of Wall Street’s projections.
The Cary-based company, which produces vinyl siding, windows and doors and other products for home exteriors, reported on Monday that net sales for the second quarter rose 1.6 percent to $510.5 million. Analysts polled by Bloomberg News were anticipating sales of $533.1 million.
Ply Gem said that last year’s acquisition of Canyon Stone accounted for $5.2 million of the $8.2 million in increased sales.
CEO Gary Robinette told analysts during a conference call that mild weather in the Northeast and upper Midwest during the first quarter had hastened the start of the spring construction season, which pulled forward sales that normally wouldn’t have occurred until the second quarter. The company’s first quarter sales were up 8.7 percent from a year ago.
Net income totaled $41.6 million, or 61 cents per share, up from $30.4 million a year ago. Analysts had projected net income of 56 cents per share.
Robinette said the company’s gross profit margin hit a record as a result of a number of factors, including operational improvements; increased prices for windows and doors products; lower material and freight costs; and acquisition synergies.
“Overall I’m pleased with the margin improvements that we are achieving in both of our business segments and as the housing market recovery progresses, we expect to see continued improvement in Ply Gem’s overall performance,” Robinette said.
Ply Gem shares were trading at $14.94, down 1 cent, Tuesday morning. The company’s shares have risen 19 percent this year.