Business

Ply Gem shares rise after company boosts profitability in Q4

Ply Gem Holdings shares rose 14 percent Monday after the Cary company reported fourth-quarter earnings that exceeded Wall Street estimates for profitability.

The company, which produces vinyl siding, windows and doors and other products for home exteriors, reported earnings per share of 13 cents, compared with a loss of 18 cents per share during the fourth quarter of 2014.

That was well above the 3 cents per share that was the consensus of analysts who cover the company.

Net sales for the quarter were $430.5 million, compared with $450.1 million during the same period in 2014. That was below the $466 million forecast by analysts.

Ply Gem attributed the decline in net sales to four fewer shipping days in the fourth quarter of 2015 compared with the same period in 2014; and unfavorable currency exchange rates.

For the year, Ply Gem’s net sales rose 17 percent to just over $1.8 billion.

Ply Gem’s performance is tied directly to the health of the housing market. CEO Gary Robinette said on a a conference call with analysts that Ply Gem anticipates “continued short-term choppiness in the housing market,” but remains optimistic about the sector’s long-term outlook.

The company expects the U.S. housing market to grow 5 to 10 percent and spending on big-ticket remodeling projects to increase 2 to 3 percent in 2016.

“Although the recovery to this point has been more moderate than previously anticipated, our view of returning to a mid-cycle level of roughly 1 million single-family housing starts is still achievable,” Robinette said.

Ply Gem shares closed at $12.75, up $1.58. The stock is up 2 percent this year.

David Bracken: 919-829-4548, @brackendavid

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