-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LNr0lFhx6JSkbvhOompmJdPWkNJVpR8G/UEj8k0TLD4MwqEQkezFl8C0pOgKnT18 VDrUQz0DRRGE+8aZOy2sMg== 0001157523-04-006763.txt : 20040727 0001157523-04-006763.hdr.sgml : 20040727 20040723085734 ACCESSION NUMBER: 0001157523-04-006763 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040722 ITEM INFORMATION: FILED AS OF DATE: 20040723 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TREX CO INC CENTRAL INDEX KEY: 0001069878 STANDARD INDUSTRIAL CLASSIFICATION: LUMBER & WOOD PRODUCTS (NO FURNITURE) [2400] IRS NUMBER: 541910453 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14649 FILM NUMBER: 04927789 BUSINESS ADDRESS: STREET 1: 160 EXETER DRIVE CITY: WINCHESTER STATE: VA ZIP: 22603-8605 BUSINESS PHONE: 5406784070 MAIL ADDRESS: STREET 1: 160 EXETER DRIVE CITY: WINCHESTER STATE: VA ZIP: 22603-8605 8-K 1 a4686603.txt TREX COMPANY, INC. 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ----------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): July 22, 2004 TREX COMPANY, INC. ------------------------------------------------- (Exact Name of Registrant as Specified in Charter) Delaware 001-14649 54-1910453 (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.) 160 Exeter Drive Winchester, Virginia 22603-8605 (Address of Principal Executive Offices) (ZIP Code) Registrant's telephone number, including area code: (540) 542-6300 Not Applicable ------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Item 12. Results of Operations and Financial Condition. On July 22, 2004, Trex Company, Inc. issued a press release announcing financial results for the quarter ended June 30, 2004. A copy of such press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in this report on Form 8-K shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. TREX COMPANY, INC. Date: July 22, 2004 /s/ Robert G. Matheny --------------------- Robert G. Matheny Chairman and Chief Executive Officer EXHIBIT INDEX ------------- Exhibit Number Exhibit Description - -------------- ------------------- 99.1 Press release dated July 22, 2004 EX-99.1 2 a4686603ex991.txt TREX COMPANY, INC. EXHIBIT 99.1 Exhibit 99.1 Trex Company Second-Quarter 2004 Revenue up 41%; EPS up 70% WINCHESTER, Va.--(BUSINESS WIRE)--July 22, 2004--Trex Company, Inc. (NYSE: TWP), manufacturer of Trex(R) decking and railing, today announced financial results for the second quarter ended June 30, 2004. Net sales for the second quarter of 2004 totaled $83.4 million compared to $59.2 million for the second quarter of 2003. Net income for the 2004 second quarter totaled $11.1 million, or $0.75 per diluted share, compared to $6.5 million, or $0.44 per diluted share, for the 2003 second quarter. For the six months ended June 30, 2004, Trex Company reported net sales of $159.7 million compared to $127.9 million for the same period last year. Net income for the six months ended June 30, 2004 totaled $20.4 million, or $1.38 per diluted share, compared to $16.6 million, or $1.13 per diluted share, for the 2003 six-month period. Chairman and Chief Executive Officer Robert Matheny commented, "Our business is proceeding according to plan in 2004. As we expected, our expanded 'early buy' program, completed at the end of April, was very successful in stimulating increased sales. Equally important, demand for both our new Trex Accents(TM) and Trex Origins(TM) product lines, as well as our new Trex Designer Series Railing(TM), a line of high-style railing components that match our deck boards, gained momentum throughout the 2004 second quarter. In addition, increased manufacturing utilization, combined with the conclusion of the 'early buy' program, resulted in improving gross margins throughout the quarter. "During the 2004 second quarter, we continued our expanded print and television advertising campaigns, which have been extremely effective in helping Trex build recognition as the leading brand franchise in the decking and related outdoor products market. In another important development, we launched our Home Depot program, which is designed to complement our current distribution channel and to help us reach a whole new set of consumers and contractors. In June, we began selling Trex(R) decking products in Home Depot stores in selected markets and making Trex(R) decking and railing products available nationally in Home Depot stores via special order through Trex's existing distribution channels." Mr. Matheny continued, "The conversion of the decking market to wood-plastic composites is continuing at a very healthy pace. Over the next two years, we plan to take a series of steps that will enable us to take full advantage of this extraordinary market opportunity. During the second half of 2004, we will continue to expand our technical development efforts so that we can continue expanding the decking and railing products Trex Company offers, enabling homeowners to build the deck of their dreams. We will also enhance our brand building activities, including, of course, our initiatives for promoting the new Home Depot program. In addition, we recently closed on the acquisition of 100 acres of land in Olive Branch, Miss., which will serve as our third and, potentially, largest manufacturing location. We expect to begin production from the facility in the summer of 2005. "In summary, we are extremely pleased with the progress Trex Company is making on all fronts, as well as with the way in which the market as a whole is continuing to expand. We believe we are well on target to achieve our previously announced guidance for 2004, which calls for net sales of $240 to $245 million and earnings per diluted share of $1.75 to $1.80." About Trex Company Trex Company is the nation's largest manufacturer of non-wood decking, which is marketed under the brand name Trex(R). Trex Wood-Polymer(R) lumber offers an attractive appearance and the workability of wood without the ongoing need for protective sealants or repairs. Trex decking and railing is manufactured in a proprietary process that combines waste wood fibers and reclaimed polyethylene and is used primarily for residential and commercial decking. The Company sells its products through approximately 90 wholesale distribution locations, which in turn sell Trex decking to approximately 3,300 independent contractor-oriented retail lumberyards across the United States and Canada. In addition, the Company's products are sold in a limited number of Home Depot stores and are available nationally in Home Depot stores via special order. For more information on Trex(R) decking and railing products, visit www.trex.com. Trex(R), Trex Wood-Polymer(R), Trex Accents(TM), Trex Origins(TM) and Trex Designer Series Railing(TM) are trademarks of Trex Company, Inc., Winchester, Va. Home Depot(R) is a trademark of The Home Depot, Inc., Atlanta, Georgia. Note: The Company has scheduled a conference call to discuss second-quarter 2004 results for 11:00 a.m. ET on Friday, July 23. A live webcast of the conference call will be available to all investors at the Trex Company web site at www.trex.com. The call will also be simulcast at www.streetevents.com. For those who cannot listen to the live broadcast, an audio replay of the call will be available on these web sites for 30 days. A telephone replay of the call will also be available from 2:00 p.m. ET on July 23 until 11:59 p.m. ET on July 30. To listen to the telephone replay, dial 800-642-1687 (706-645-9291 outside the U.S.) and enter conference ID #8260371. The statements in this press release regarding the Company's expected sales performance and operating results, its projections of net sales, net income, earnings per share and costs, its anticipated financial condition and its business strategy constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are subject to risks and uncertainties that could cause the Company's actual operating results to differ materially. Such risks and uncertainties include the extent of market acceptance of the Company's products, the sensitivity of the Company's business to general economic conditions, the Company's ability to continue to obtain raw materials at acceptable prices, the Company's ability to increase production levels to meet increasing demand for its products, and the highly competitive markets in which the Company operates. The Company's report on Form 10-K filed with the Securities and Exchange Commission on March 5, 2004 discusses some of the important factors that could cause the Company's actual results to differ materially from those expressed or implied in these forward-looking statements. The Company expressly disclaims any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. (Tables to follow) Trex Company, Inc. Condensed Consolidated Statements of Operations (In thousands, except share and per share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2003 2004 2003 2004 ---- ---- ---- ---- Net sales $59,198 $83,407 $127,876 $159,664 Cost of sales 32,300 46,425 71,220 92,699 ------- ------- -------- --------- Gross profit 26,898 36,982 56,656 66,965 Selling, general and administrative expenses 15,903 18,528 28,462 32,667 ------- ------- -------- --------- Income from operations 10,995 18,454 28,194 34,298 Interest expense, net (884) (935) (1,797) (1,909) ------- ------- -------- --------- Income before taxes 10,111 17,519 26,397 32,389 Income taxes 3,578 6,451 9,767 11,984 ------- ------- -------- --------- Net income $ 6,533 $11,068 $ 16,630 $ 20,405 ======= ======= ======== ========= Diluted earnings per common share $ 0.44 $ 0.75 $ 1.13 $ 1.38 ======= ======= ======== ========= Diluted weighted average shares outstanding 14,751,928 14,771,024 14,692,551 14,765,333 ========== ========== ========== ========== TREX COMPANY, INC. Condensed Consolidated Balance Sheets (In thousands, except share data) 31-Dec-03 30-Jun-04 --------- --------- (unaudited) ASSETS Current assets: Cash and cash equivalents $8,151 $38,888 Trade accounts receivable 5,829 31,228 Inventories 45,950 18,730 Prepaid expenses and other assets 1,899 2,705 Deferred income taxes 2,169 2,453 -------- --------- Total current assets 63,998 94,004 ======== ========= Property, plant and equipment, net 138,062 139,735 Goodwill, net 6,837 6,837 Other assets 1,558 2,052 -------- --------- Total assets $210,455 $242,628 ======== ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable and accrued expenses $13,297 $19,686 Income taxes payable 200 3,955 Current portion long-term debt 886 16,918 ------- -------- Total current liabilities 14,383 40,559 ------- -------- Deferred income taxes 13,174 14,633 Debt-related derivatives 2,202 1,663 Long-term debt, net of current portion 53,490 37,023 ------- -------- Total liabilities 83,249 93,878 ======= ======== Stockholders' equity: Preferred stock, $0.01 par value, 3,000,000 shares authorized; none issued and outstanding -- -- Common stock, $0.01 par value, 40,000,000 shares authorized; 14,702,231 and 14,720,796 shares issued and outstanding at December 31, 2003 and June 30, 2004 147 147 Additional paid-in capital 55,889 56,405 Deferred compensation (1,829) (1,545) Accumulated other comprehensive loss (1,387) (1,048) Retained earnings 74,386 94,791 ------- -------- Total stockholders' equity 127,206 148,750 ------- -------- Total liabilities and stockholders' equity $210,455 $242,628 ======== ========= Trex Company, Inc. Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited) Six Months Ended June 30, 2003 2004 ---- ---- OPERATING ACTIVITIES Net income $ 16,630 $ 20,405 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 6,075 6,576 Other non-cash charges 1,822 1,684 Changes in operating assets and liabilities (15,148) 11,159 ------------ ------------- Net cash provided by operating activities $9,379 $39,824 ------------ ------------- INVESTING ACTIVITIES ($7,891) ($9,059) ------------ ------------ FINANCING ACTIVITIES $5,248 ($28) ------------ ------------ Net increase in cash and cash equivalents $ 6,736 $ 30,737 Cash and cash equivalents at beginning of period $ 14,893 $ 8,151 ------------ ------------ Cash and cash equivalents at end of period $ 21,629 $ 38,888 ============ ============ CONTACT: Trex Company, Inc. Robert G. Matheny, 540-542-6300 or Lippert/Heilshorn & Associates Harriet Fried, 212-838-3777 -----END PRIVACY-ENHANCED MESSAGE-----