Exhibit 99.1
News Release
P. O. Box 1980
Winchester, VA 22604-8090
FOR IMMEDIATE RELEASE
Contact: Glenn Eanes
Vice President and Treasurer
540-665-9100
AMERICAN WOODMARK CORPORATION
ANNOUNCES FOURTH QUARTER 2005 RESULTS
AUTHORIZES ADDITIONAL $10 MILLION SHARE REPURCHASE
Winchester, Virginia (June 7, 2005) — American Woodmark Corporation (Nasdaq/NM: AMWD) today announced results for the fourth quarter and full fiscal year ended April 30, 2005.
Net sales for the fourth quarter increased 15% from the prior year to $207,131,000. The Company had previously issued forward guidance that anticipated growth of 15% to 20%. Increased sales for the quarter were principally driven by higher unit volume and improved product mix as a result of continued strong demand in the remodel and new construction sectors.
Gross profit for the fourth quarter of 2005 was 17.6% of sales, down from 19.6% the previous year. The Company experienced continued inflationary pressures in both materials and transportation costs. The acquisition cost of certain materials, particularly hardwood lumber and hardware, increased due to market pressures. Higher transportation costs were driven by the continuing impact of difficult industry conditions creating carrier instability, driver and equipment shortages and higher fuel costs. The Company was unable to recover these inflationary increases during the quarter. In addition, manufacturing overhead costs increased with the opening of two new manufacturing facilities during the third quarter of 2005.
Selling, general and administrative costs decreased to 11.7% of net sales from 12.0% the previous year, as increased promotional expenses were more than offset by cost management efforts and lower costs associated with the Company’s pay-for-performance employee incentive plans.
Net income for the quarter was $7,452,000, or $0.44 per diluted share, compared with net income of $8,378,000, or $0.50 per diluted share, in the prior year.
For the fiscal year, net sales were $776,990,000, an increase of 16% over fiscal 2004. The Company’s gross margin of 19.6% in fiscal 2005 compared to 20.6% in the prior year. Net income for fiscal 2005 was $35,591,000 or $2.11 per diluted share, compared with $31,707,000 or $1.90 per diluted share for the prior year.
Looking forward to the first fiscal quarter ending July 31, 2005, the Company expects continued strong demand in both the remodeling and new construction markets. The Company expects net sales to increase 10% to 15% above the first quarter of the prior year. The Company expects continued inflationary pressures on raw material and transportation costs. The Company continues to pursue pricing relief with its customers; however these efforts will have limited impact upon our first fiscal quarter. Based upon these expectations, the Company currently believes net income for the first quarter of 2006 will be in the range of $0.30 to $0.40 per diluted share, versus $0.58 in fiscal 2005.
In addition, the Company’s Board of Directors authorized the repurchase of $10 million in common stock. The additional authorization increases the total repurchase program, initiated in 2001, to $40 million. To date, the Company has repurchased $27.6 million in common stock of the previous $30 million authorized.
American Woodmark Corporation manufactures and distributes kitchen cabinets and vanities for the remodeling and new home construction markets. Its products are sold on a national basis directly to home centers, major builders and home manufacturers and through a network of independent distributors. The Company presently operates fifteen manufacturing facilities and ten service centers across the country.
Safe harbor statement under the Private Securities Litigation Reform Act of 1995: All forward looking statements made by the Company involve material risks and uncertainties and are subject to change based on factors that may be beyond the Company’s control. Accordingly, the Company’s future performance and financial results may differ materially from those expressed or implied in any such forward looking statements. Such factors include, but are not limited to, those described in the Company’s filings with the Securities and Exchange Commission and the Annual Report to Shareholders. The Company does not undertake to publicly update or revise its forward looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.
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AMERICAN WOODMARK CORPORATION
Unaudited Financial Highlights
(in thousands, except share data)
Operating Results
Three Months Ended April 30 | Twelve Months Ended April 30 | ||||||||||||
| 2005 | 2004 | 2005 | 2004 | ||||||||||
Net Sales | $ | 207,131 | $ | 180,361 | $ | 776,990 | $ | 667,547 | |||||
Cost of Sales & Distribution | 170,673 | 145,024 | 624,610 | 530,038 | |||||||||
Gross Profit | 36,458 | 35,337 | 152,380 | 137,509 | |||||||||
Sales & Marketing Expense | 18,071 | 14,767 | 67,225 | 59,653 | |||||||||
G&A Expense | 6,063 | 6,900 | 26,788 | 25,452 | |||||||||
Operating Income | 12,324 | 13,670 | 58,367 | 52,404 | |||||||||
Interest & Other (Income) Expense | 108 | (64 | ) | 22 | 408 | ||||||||
Income Tax Expense | 4,764 | 5,356 | 22,754 | 20,289 | |||||||||
Net Income | $ | 7,452 | $ | 8,378 | $ | 35,591 | $ | 31,707 | |||||
Earnings Per Share: | |||||||||||||
Weighted Average Shares Outstanding – Diluted | 16,850,354 | 16,743,280 | 16,879,877 | 16,667,924 | |||||||||
Earnings Per Diluted Share | $ | 0.44 | $ | 0.50 | $ | 2.11 | $ | 1.90 | |||||
Balance Sheet | |||||||
April 30 2005 | April 30 2004 | ||||||
Cash & Cash Equivalents | $ | 24,406 | $ | 29,432 | |||
Customer Receivables | 52,877 | 48,286 | |||||
Inventories | 65,213 | 54,921 | |||||
Other Current Assets | 14,158 | 12,019 | |||||
Total Current Assets | 156,654 | 144,658 | |||||
Property, Plant & Equipment | 185,513 | 143,136 | |||||
Other Assets | 19,001 | 19,257 | |||||
Total Assets | $ | 361,168 | $ | 307,051 | |||
Current Portion – Long-Term Debt | $ | 1,046 | $ | 988 | |||
Accounts Payable & Accrued Expenses | 81,496 | 74,332 | |||||
Total Current Liabilities | 82,542 | 75,320 | |||||
Long-Term Debt | 29,217 | 18,028 | |||||
Other Liabilities | 34,218 | 20,558 | |||||
Total Liabilities | 145,977 | 113,906 | |||||
Stockholders’ Equity | 215,191 | 193,145 | |||||
Total Liabilities & Stockholders’ Equity | $ | 361,168 | $ | 307,051 | |||