EXHIBIT 99(a)
NEWS RELEASE
AT THE COMPANY FLEISHMAN HILLARD
Michael R. Cole Jim Ankner
Chief Financial Officer Vice President
616/364-6161 212/453-2198
FOR IMMEDIATE RELEASE
MONDAY, APRIL 14, 2003
UNIVERSAL FOREST PRODUCTS, INC. POSTS MODEST FIRST-QUARTER SALES INCREASE;
HARSH WINTER CONTRIBUTES TO DECREASE IN NET EARNINGS
GRAND RAPIDS, MI, April 14, 2003 -- Universal Forest Products (Nasdaq: UFPI)
today announced net sales of $356 million for the first quarter of 2003, a 4%
increase over net sales of $342 million reported for the same period last year.
Universal posted these results even in the face of an 11% decrease in the lumber
market.
However, an unusually harsh winter contributed to a decrease in net earnings.
Diluted earnings per share for the quarter were $0.25, a 22% decrease over
diluted earnings per share of $0.32 for the same period last year.
"Although inclement winter weather hit us hard and made February one of the
weakest months in Universal's history, the outlook for the year is positive,"
said CEO William G. Currie. "March was an excellent month -- sales and profits
outpaced last year's strong March performance -- and we believe it's an
indication of what lies ahead. For this reason, we're continuing to target
annual sales and diluted earnings per share growth of 7% to 12% for 2003."
By market, Universal posted first quarter sales of:
* $157 million D-I-Y/retail, up 7% over last year;
* $77 million in site-built construction, an increase of 12% over last year;
* $65 million in industrial/other, up 10% over last year, and
* $57 million in manufactured housing, a 15% decrease over last year, which was
significantly less than the most recently reported market decline of
approximately 28%.
In addition to the obvious pressures on business today - the weak economy, a
soft lumber market, and the war in Iraq, for example - weather had an impact on
these results. Universal plants across the nation lost 154 production days in
the first quarter of 2003, compared to 11 lost production days during last
year's first quarter. As a result, sales were impacted by soft demand and
Universal incurred significant weather-related cost inefficiencies.
"We controlled what we could and had stronger results than might be expected
given the weather and economic conditions," Currie added.
MORE...
Universal Forest Products will conduct a conference call to discuss information
included in this news release and related matters at 11:00 a.m. EDT on Tuesday,
April 15, 2003. The conference call will be hosted by William G. Currie and will
be available for analysts and institutional investors domestically at (800)
521-5469 or internationally at (303) 486-1489. Use conference call ID #3322220.
The conference call will be available simultaneously, and in its entirety, to
all interested investors and news media through a web cast at www.ufpi.com.
Universal Forest Products markets, manufactures, and engineers products for
D-I-Y retail home centers, structural lumber products for the manufactured
housing industry, engineered wood components for the site-built construction
market and specialty wood packaging for various industries. In the recent
"Fortune 1000" list of America's largest corporations, Universal jumped 73
places to number 769. The company was rated highly against the other eleven
companies included in its industry group. For example, it posted the largest
percent gain in profits from 2001, and was #1 in profits as a percent of assets
and of stockholders' equity, and in total return to investors in 2002.
For information about Universal Forest Products on the Internet, please contact
the Company's web site at www.ufpi.com, or call 888-Buy-UFPI.
Included in this report are certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Such forward-looking
statements are based on the beliefs of the Company's management as well as on
assumptions made by and information currently available to the Company at the
time such statements were made. Actual results could differ materially from
those included in such forward-looking statements. Investors are cautioned that
all forward-looking statements involve risks and uncertainty. Among the factors
that could cause actual results to differ materially are the following: Adverse
lumber market trends, competitive activity, negative economic trends, government
regulations, and weather. These risk factors and additional information are
included in the company's reports on Form 10K and 10Q on file with the
Securities and Exchange Commission.
FINANCIAL HIGHLIGHTS TO FOLLOW
CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2003/2002
QUARTER PERIOD YEAR TO DATE
(IN THOUSANDS, EXCEPT PER SHARE DATA) 2003 2002 2003 2002
NET SALES $ 355,619 100% $ 341,656 100% $ 355,619 100% $ 341,656 100%
COST OF GOODS SOLD 303,815 85.43 290,379 84.99 303,815 85.43 290,379 84.99
--------- --------- --------- ---------
GROSS PROFIT 51,804 14.57 51,277 15.01 51,804 14.57 51,277 15.01
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 40,188 11.30 37,798 11.06 40,188 11.30 37,798 11.06
--------- --------- --------- ---------
EARNINGS FROM OPERATIONS 11,616 3.27 13,479 3.95 11,616 3.27 13,479 3.95
INTEREST EXPENSE 3,787 1.06 2,908 0.85 3,787 1.06 2,908 0.85
INTEREST REVENUE (47) -0.01 (113) -0.03 (47) -0.01 (113) -0.03
--------- --------- --------- ---------
3,740 1.05 2,795 0.82 3,740 1.05 2,795 0.82
--------- --------- --------- ---------
EARNINGS BEFORE INCOME TAXES
AND MINORITY INTEREST 7,876 2.21 10,684 3.13 7,876 2.21 10,684 3.13
INCOME TAXES 2,791 0.78 3,973 1.16 2,791 0.78 3,973 1.16
--------- --------- --------- ---------
EARNINGS BEFORE MINORITY INTEREST 5,085 1.43 6,711 1.96 5,085 1.43 6,711 1.96
MINORITY INTEREST (585) -0.16 (629) -0.18 (585) -0.16 (629) -0.18
--------- --------- --------- ---------
NET EARNINGS $ 4,500 1.27 $ 6,082 1.78 $ 4,500 1.27 $ 6,082 1.78
========= ========= ========= =========
EARNINGS PER SHARE - BASIC $ 0.25 $ 0.33 $ 0.25 $ 0.33
EARNINGS PER SHARE - DILUTED $ 0.25 $ 0.32 $ 0.25 $ 0.32
WEIGHTED AVERAGE SHARES
OUTSTANDING 17,729 18,210 17,729 18,210
WEIGHTED AVERAGE SHARES
OUTSTANDING WITH COMMON
STOCK EQUIVALENTS 18,252 19,024 18,252 19,024
SUPPLEMENTAL SALES DATA
QUARTER PERIOD YEAR TO DATE
---------------------------------------------- --------------------------------------------------
MARKET CLASSIFICATION 2003 % 2002 % 2003 % 2002 %
DO-IT-YOURSELF $156,968 44% $146,757 43% $156,968 44% $146,757 43%
SITE-BUILT CONSTRUCTION 76,724 22% 68,591 20% 76,724 22% 68,591 20%
MANUFACTURED HOUSING 57,382 16% 67,368 20% 57,382 16% 67,368 20%
INDUSTRIAL AND OTHER 64,545 18% 58,940 17% 64,545 18% 58,940 17%
-------- --- -------- --- -------- --- -------- ---
TOTAL $355,619 100% $341,656 100% $355,619 100% $341,656 100%
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
MARCH 2003/2002
(IN THOUSANDS)
LIABILITIES AND
ASSETS 2003 2002 SHAREHOLDERS' EQUITY 2003 2002
====================================================================================================================================
CURRENT ASSETS CURRENT LIABILITIES
Cash and cash equivalents $ 7,295 $ 12,503 Notes payable $ 1,701 $ 2,025
Restricted cash equivalents 1,383 - Accounts payable and
Accounts receivable 149,327 135,218 accrued liabilities 106,805 111,567
Inventories 196,228 167,661 Current portion of long-term
Other current assets 7,851 3,472 debt and capital leases 6,611 20,512
--------- -------- ---------- ---------
TOTAL CURRENT ASSETS 362,084 318,854 TOTAL CURRENT LIABILITIES 115,117 134,104
OTHER ASSETS 6,608 6,548 LONG-TERM DEBT AND CAPITAL
INTANGIBLE ASSETS 131,742 123,523 LEASES, LESS CURRENT PORTION 297,020 240,174
OTHER LIABILITIES 26,752 23,458
PROPERTY, PLANT
AND EQUIPMENT, NET 207,121 187,531 SHAREHOLDERS' EQUITY 268,666 238,720
--------- -------- ---------- ---------
TOTAL LIABILITIES AND
TOTAL ASSETS $ 707,555 $636,456 SHAREHOLDERS' EQUITY $ 707,555 $ 636,456
========= ======== ========== =========
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2003/2002
(IN THOUSANDS) 2003 2002
- ----------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 4,500 $ 6,082
Adjustments to reconcile net earnings to net cash
from operating activities:
Depreciation 5,949 5,611
Amortization of intangibles 322 301
Deferred income taxes (405) (153)
Loss on sale or impairment of property, plant and equipment 86 66
Changes in:
Accounts receivable (44,110) (46,490)
Inventories (30,222) (44,856)
Accounts payable 14,497 22,111
Accrued liabilities and other (7,715) 1,068
-------- --------
NET CASH FROM OPERATING ACTIVITIES (57,098) (56,260)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment (9,809) (5,255)
Acquisitions, net of cash received -- (359)
Proceeds from sale of property, plant and equipment 144 161
Other 44 1,222
-------- --------
NET CASH FROM INVESTING ACTIVITIES (9,621) (4,231)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under revolving credit facilities and notes payable 61,752 86,453
Repayment of long-term debt (22) (158)
Proceeds from issuance of common stock 730 62
Distributions to minority shareholder (273) (250)
Repurchase of common stock (1,627) (36,000)
-------- --------
NET CASH FROM FINANCING ACTIVITIES 60,560 50,107
-------- --------
NET CHANGE IN CASH AND CASH EQUIVALENTS (6,159) (10,384)
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD 13,454 22,887
-------- --------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 7,295 $ 12,503
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