On April 25, building material manufacturer USG (NYSE:USG) released first-quarter earnings for the period ended March 31.
- As the housing market continues to crumble, revenues slid. Earnings swung to a profit after suffering a loss last year because of fees related to its bankruptcy.
- Growing expenses (due to higher levels of compensation and benefits) coupled with greater costs at new corporate office locations contributed to declining margins.
- The company has responded to the construction slowdown by balancing wallboard production volumes and pricing, along with adjusting manufacturing capacity.
- Investors in the Motley Fool CAPS community are high on USG, giving it a four-star rating, but it still scores a notch below competitor Eagle Materials (NYSE:EXP) and its five-star goodness.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q1 2007 |
Q1 2006 |
Change | |
|---|---|---|---|
|
Sales |
$1,259.0 |
$1,465.0 |
(14.1%) |
|
Net Profit |
$41.0 |
($141.0) |
N/A |
|
EPS |
$0.45 |
($2.44) |
N/A |
|
Diluted Shares |
91.7 |
57.8 |
58.7% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* | |
|---|---|---|---|
|
Gross Margin |
16.8% |
24.4% |
(7.5) |
|
Operating Margin |
7.6% |
17.5% |
(9.9) |
|
Net Margin |
3.3% |
(9.6%) |
12.9 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$411 |
$1,363 |
(69.8%) |
|
Accounts Rec. |
$604 |
$639 |
(5.5%) |
|
Inventory |
$380 |
$341 |
11.4% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$364 |
$321 |
13.4% |
|
Long-Term Debt |
$1,239 |
$1,005 |
23.3% |
Learn the ways of the balance sheet.
Cash Flow Highlights
Unfortunately, USG did not provide a cash flow statement in its earnings release. (Booooo!)
Related Foolishness:
- What's on Board for USG?
- Housing Woes Stain Sherwin-Williams
- A $2 Million Loss or a $1.3 Billion Gain?
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