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Huttig Building Products Sales Fall 21% in 2007
February 6, 2008
Huttig Building Products, Inc., St. Louis, MO, distributor of millwork, building materials and wood products, reported a net loss for the year ended Dec. 31, 2007, of $8 million, compared with a net loss of $7.7 million in the prior year. Sales fell 21% to $874.8 million.
Sales to national accounts, representing 36% of 2007 sales, declined by 18% from 2006.
Looking ahead, most current forecasts do not expect a bottom in new housing construction until late in 2008," CEO Jon Vrabely said. "Our continued challenge is to balance our cost reduction efforts with the need to maintain our strategic infrastructure and high service levels so that Huttig is well positioned when the market rebounds. We remain focused on doing everything we can to reduce costs, increase efficiencies, and manage cash, while preserving Huttig's national footprint, value added capabilities, and our customer and vendor relationships.
"Given the precipitous drop in housing starts during the second half of 2007, it has been difficult to get in front of the housing downturn from a cost reduction standpoint."
In the fourth quarter 2007, the company reported a net loss of $5.8 million, and sales fell 22% to $179.9 million.
In December, the company announced the closure of distribution facilities in Greensburg, Pennsylvania and Kansas City, Missouri. In the 2007 fourth quarter, Huttig also continued to reduce its workforce. During the quarter, Huttig continued its program aimed at reducing inventories, improving working capital, generating cash and reducing debt. Inventories declined 9% from the prior-year period.
"While seasonally one of our slowest quarters, the fourth quarter of 2007 was also significantly impacted by the 26% year over year decline in annualized housing starts, to approximately 1.15 million, from approximately 1.56 million in the corresponding year ago period," said Vrabely. "December was a particularly difficult month as several of our trading areas were affected by winter weather patterns and many of our large customers curtailed their purchases in an attempt to reduce their year-end inventory levels.
"Given these challenges, we believe Huttig performed reasonably well. Total sales were down only 22%, versus a market that was off 26%. We believe that we continued to gain market share in building products, with year over year sales increases in categories such as composite decking and railing, and fasteners."