Huttig Building Products reported a net loss of $10.3 million in the second quarter of 2019 after posting a net income of $0.2 million in the same period during 2018. The St. Louis-based distributor also announced net sales ticked down slightly year over year (YOY) in its second quarter earnings report.
Net sales for the distributor were $218.5 million in the second quarter, down 2.2% from the second quarter in 2018. Huttig attributed to the decline in sales to a modest market softening and prolonged adverse weather conditions which negatively impacted construction. Net sales for millwork products decreased 3.9% in the second quarter to $99.5 million and wood product sales declined by 12.7% YOY. Building product sales ticked up 1.7% YOY to $101.1 million. The increase in sales in the building product category is consistent with Huttig’s strategic growth initiatives, according to the company.
“Our sales are slightly behind last year’s pace due to some market softening caused in part by inclement weather across many parts of the country in the first half of the year,” Jon Vrabely, Huttig’s president and CEO said. “While we made a significant investment in, and successfully executed a major ERP upgrade, we experienced temporary disruption which impacted our sales.”
Vrabely said Huttig’s cost management initiatives has begun to improve the company’s operating income and cash management has reduced borrowing needs. Operating income increased 57% YOY to $3.3 million. The company’s operating expenses decreased $2.0 million to $41.0 million in the second quarter of 2019 compared to the previous year’s second quarter.
Huttig’s gross margin decreased 1.8% YOY to $44.3 million in the second quarter of 2019. Gross margin as a percentage of sales inched up 10 basis points YOY to 20.3% in the second quarter of 2019.
The company’s adjusted EBITDA for the second quarter of 2019 was $5.2 million, down $1.3 million from the second quarter of 2018.
