GRAND RAPIDS, Mich. - UFP Industries, Inc. (NASDAQ:UFPI) reported its first quarter 2024 financial results with net sales of $1.64 billion, a 10% decrease compared to the first quarter of the previous year, attributed to a 9% drop in selling prices and a 1% decline in organic unit sales.
Despite the sales downturn, the company surpassed analyst expectations for adjusted earnings per share (EPS), posting $1.96 versus the anticipated $1.66. However, the revenue fell short of the consensus estimate of $1.71 billion.
Chairman and CEO Matthew J. Missad attributed the results to the company's balanced business model and dedicated team, highlighting efforts to enhance operational efficiencies through investments in automation and technology, as well as growth through new products and regional capacity expansion. Missad also emphasized the company's focus on shareholder value through increased share repurchase activity and a 32% hike in quarterly dividend payouts.
The first quarter saw a mix of segment performance, with UFP Retail Solutions experiencing a 17% decrease in net sales, UFP Packaging (NYSE:PKG) down by 13%, and UFP Construction's net sales remaining relatively stable. Adjusted EBITDA for the quarter was $181 million, down 10% YoY, with a slight decline in adjusted EBITDA margin to 11%.
Looking ahead, UFP Industries provided a cautious outlook for the remainder of 2024, expecting lumber prices to stay at lower historical levels and forecasting a mid-single-digit decrease in demand for its packaging and retail segments. The construction segment is projected to have a slight increase or decrease in demand. The company also plans to continue its strategic capital allocation, targeting up to $300 million in investments for the year.
UFP Industries maintains a robust balance sheet, with $702.6 million in net surplus cash as of March 30, 2024, and approximately $2.2 billion in liquidity. The company's approach to capital allocation includes strategic acquisitions, organic growth, dividend payments, and share repurchases, with a quarterly dividend of $0.33 per share set to be paid on June 17, 2024, to shareholders of record on June 3, 2024.
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