Delaware | 1-13429 | 94-3196943 | ||
(State or other jurisdiction of incorporation) | (Commission file number) | (I.R.S. Employer Identification No.) |
¬ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¬ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-2) |
¬ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¬ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240. 13e-4(c)) |
Exhibit No. | Description | |
Exhibit 99.1 | Press release dated April 24, 2014. |
Simpson Manufacturing Co., Inc. | |||
(Registrant) | |||
DATE: April 24, 2014 | By | /s/ Brian J. Magstadt | |
Brian J. Magstadt | |||
Chief Financial Officer |
• | Segment net sales: |
◦ | North America – Net sales increased 7.2% in the first quarter of 2014, compared to the first quarter of 2013. Net sales in the United States increased over the same period in 2013, primarily due to increased sale volumes, partly offset by slightly lower average selling prices. Canada net sales increased slightly over the same period in 2013 due to increased sales volumes, partly offset by the effects of foreign currency translations and lower average selling prices. |
◦ | Europe – Net sales increased 15.7% in the first quarter of 2014 compared to the first quarter of 2013, mostly due to increased sales volumes and the effects of foreign currency translations, partly offset by lower selling prices. |
• | Consolidated net sales channels and product groups: |
◦ | Net sales to contractor distributors, dealer distributors, lumber dealers and home centers increased in the first quarter of 2014, compared to the first quarter of 2013, with above-average sales increases to contractor distributors and lumber dealers. |
◦ | Wood construction product sales, including connectors, truss plates, fastening systems, fasteners and shearwalls, represented 86% of total Company sales in the first quarter of each of 2014 and 2013. |
◦ | Concrete construction product sales, including adhesives, chemicals, mechanical anchors, powder actuated tools and reinforcing fiber materials, represented 14% of total Company sales in the first quarter of each of 2014 and 2013. |
• | North America – Gross profit margin increased to 49.2% in the first quarter of 2014 from 44.7% in the first quarter of 2013, as a result of decreases in all elements of costs as a percentage of sales, with the largest decreases as a percentage of sales in factory overhead elements on increased volumes and in material. The gross profit margin also benefited from a one-time $2.5 million correction to worker compensation expense in states where the Company is not self-insured. Concrete construction product sales, which have a lower gross profit margin than wood construction product sales, were 13% of North America sales in the first quarter of each of 2014 and 2013. |
• | Europe – Gross profit margin increased to 35.3% in the first quarter of 2014 from 30.5% in the first quarter of 2013, as a result of decreases in all elements of costs as a percentage of sales, with the largest decrease as a percentage of sales in factory overhead on increased volumes and in material. Concrete construction product net sales, which have a lower gross profit margin than wood construction product sales, were 13% and 12% of Europe net sales in the first quarter of 2014 and the first quarter of 2013, respectively. |
• | Product mix – The gross profit margin differential between wood construction products and concrete construction products was 15% in the first quarter of each of 2014 and 2013. |
• | Steel prices – Steel prices have decreased slightly from December 2013. Based on current estimates, the Company expects the market price for steel to increase during the second quarter of 2014. |
• | North America – |
◦ | Research and development and engineering expense increased $0.9 million, primarily due to increases of $0.7 million in professional fees related to software development, $0.4 million in cash profit sharing, and $0.4 million in personnel costs related to the addition of staff in support of product and software development and pay rate increases instituted in January 2014. |
◦ | In late 2013, the Company began capitalizing software development costs, which resulted in a decrease of $0.5 million in software development expense in the first quarter of 2014 compared to the first quarter of 2013. |
• | North America – Selling expense increased slightly, due to increases of $0.3 million in cash profit sharing and sales commissions and $0.3 million in professional fees, partly offset by a decrease of $0.4 million in promotional expense. |
• | North America – General and administrative expense increased $2.3 million, primarily due to increases of $1.0 million in cash profit sharing, $0.4 million in personnel costs related to the addition of administrative and information technology staff and pay rate increases instituted in January 2014, $0.3 million in depreciation expense and $0.1 million in professional fees. |
• | Europe – General and administrative expense decreased by $1.5 million, primarily due to decreases of $1.0 million in impairment of fixed assets, $0.6 million in net foreign currency loss and $0.2 million in professional fees, partly offset by increases of $0.3 million in personnel costs and $0.3 million in cash profit sharing. |
• | Administrative and all other – General and administrative expense increased due to increases of $0.5 million in cash profit sharing and $0.3 million in professional fees, partly offset by a net increase of $0.3 million in foreign currency gain. The Company has adjusted rent revenue and expense mostly associated with its property in Vacaville, California, to general and administrative expense. Rent revenue in the first quarter of each of 2014 and 2013 was $0.3 million. |
Three Months Ended March 31, | ||||||||
(Amounts in thousands, except per share data) | 2014 | 2013 | ||||||
Net sales | $ | 168,288 | $ | 154,281 | ||||
Cost of sales | 90,526 | 89,561 | ||||||
Gross profit | 77,762 | 64,720 | ||||||
Research and development and engineering expenses | 9,700 | 8,308 | ||||||
Selling expenses | 21,819 | 21,371 | ||||||
General and administrative expenses | 26,922 | 26,036 | ||||||
Net gain on disposal of assets | (285 | ) | (8 | ) | ||||
Income from operations | 19,606 | 9,013 | ||||||
Interest income, net | 85 | 38 | ||||||
Income before taxes | 19,691 | 9,051 | ||||||
Provision for income taxes | 7,604 | 4,256 | ||||||
Net income | $ | 12,087 | $ | 4,795 | ||||
Earnings per common share: | ||||||||
Basic | $ | 0.25 | $ | 0.10 | ||||
Diluted | 0.25 | 0.10 | ||||||
Weighted average shares outstanding: | ||||||||
Basic | 48,899 | 48,536 | ||||||
Diluted | 49,065 | 48,626 | ||||||
Other data: | ||||||||
Depreciation and amortization | $ | 7,684 | $ | 7,487 | ||||
Pre-tax impairment of assets | — | 1,025 | ||||||
Pre-tax equity-based compensation expense | 2,657 | 2,977 | ||||||
Cash dividend declared per common share | $ | 0.125 | $ | — |
March 31, | December 31, | |||||||||||
(Amounts in thousands) | 2014 | 2013 | 2013 | |||||||||
Cash and short-term investments | $ | 211,988 | $ | 141,965 | $ | 251,208 | ||||||
Trade accounts receivable, net | 114,159 | 102,813 | 90,017 | |||||||||
Inventories | 216,529 | 202,341 | 197,728 | |||||||||
Assets held for sale | — | 577 | — | |||||||||
Other current assets | 29,071 | 32,796 | 29,153 | |||||||||
Total current assets | 571,747 | 480,492 | 568,106 | |||||||||
Property, plant and equipment, net | 207,457 | 211,010 | 209,533 | |||||||||
Goodwill | 129,433 | 122,582 | 129,218 | |||||||||
Other noncurrent assets | 44,532 | 57,463 | 46,756 | |||||||||
Total assets | $ | 953,169 | $ | 871,547 | $ | 953,613 | ||||||
Trade accounts payable | $ | 31,291 | $ | 30,958 | $ | 34,933 | ||||||
Notes payable and lines of credit | 83 | 1,214 | 103 | |||||||||
Other current liabilities | 64,175 | 42,519 | 68,169 | |||||||||
Total current liabilities | 95,549 | 74,691 | 103,205 | |||||||||
Other long-term liabilities | 10,111 | 8,435 | 9,129 | |||||||||
Stockholders' equity | 847,509 | 788,421 | 841,279 | |||||||||
Total liabilities and stockholders' equity | $ | 953,169 | $ | 871,547 | $ | 953,613 |
Three Months Ended | ||||||||||||
March 31, | % | |||||||||||
(Amounts in thousands) | 2014 | 2013 | change | |||||||||
Net Sales by Reporting Segment | ||||||||||||
North America | $ | 136,882 | $ | 127,737 | 7% | |||||||
Europe | 27,647 | 23,900 | 16% | |||||||||
Asia/Pacific | 3,759 | 2,644 | 42% | |||||||||
Administrative and all other | — | — | N/M | |||||||||
Total | $ | 168,288 | $ | 154,281 | 9% | |||||||
Net Sales by Product Group* | ||||||||||||
Wood Construction | $ | 144,676 | $ | 132,795 | 9% | |||||||
Concrete Construction | 23,524 | 21,421 | 10% | |||||||||
Other | 88 | 65 | N/M | |||||||||
Total | $ | 168,288 | $ | 154,281 | 9% | |||||||
Gross Profit by Reporting Segment | ||||||||||||
North America | $ | 67,290 | $ | 57,091 | 18% | |||||||
Europe | 9,764 | 7,283 | 34% | |||||||||
Asia/Pacific | 756 | 446 | 70% | |||||||||
Administrative and all other | (48 | ) | (100 | ) | N/M | |||||||
Total | $ | 77,762 | $ | 64,720 | 20% | |||||||
Income (Loss) from Operations | ||||||||||||
North America | $ | 22,561 | $ | 15,260 | 48% | |||||||
Europe | (919 | ) | (4,180 | ) | 78% | |||||||
Asia/Pacific | (1,151 | ) | (1,184 | ) | 3% | |||||||
Administrative and all other | (885 | ) | (883 | ) | N/M | |||||||
Total | $ | 19,606 | $ | 9,013 | 118% |
* | The Company manages its business by geographic segment but is presenting sales by product group as additional information. | |
N/M | Statistic is not material or not meaningful. |