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USG Corp. (NYSE: USG), Chicago, IL, reported sales for the third quarter of $972 million, up 5 percent from the same period a year ago. The company recorded a net loss of $11 million for the period, compared to profit of $23 million a year ago.
L&W Supply, USG's distribution business, reported sales of $359 million for the quarter, a year-over-year increase of 8 percent. Operating profit grew 33 percent to $4 million.
For the first nine months, sales for USG were $2.8 million, a year-over-year increase of 4 percent. Profit grew 82 percent to $91 million.
L&W Supply sales for the first nine months grew 8 percent to $1 billion. Operating profit was $9 million, compared to $2 million a year ago.
During the third quarter, USG reached an agreement in principle to settle all claims made in the direct and indirect purchaser class actions consolidated in the lawsuit, In re: Domestic Wallboard Antitrust Litigation, MDL No. 2437, pending in the United States District Court for the Eastern District of Pennsylvania. Pursuant to the agreement in principle to settle, which is subject to finalization of a settlement agreement and court approval, USG will make a payment of $48 million. USG strongly denies any wrong-doing for the claims made in the lawsuits, but settled to avoid the expense, distraction and risk of further litigation. USG expects to make this cash payment within the next twelve months, while recording the $48 million charge in the third quarter of 2014.
“It is very disappointing to settle this lawsuit when we strongly believe we have done nothing wrong,” said James Metcalf, president and CEO. “However, we have to be realistic about the cost and risk a lawsuit like this creates for USG.”