WIRE - Earnings call transcript Q4 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

00:13 Good morning and welcome to the Encore Wire Reports Fourth Quarter and Full-Year 2021 Results Conference Call. My name is [Sunera] [ph] and I'll be the operator for today’s call. At this time, all participants are in a listen-only mode. Later, we’ll conduct a question-and-answer session. [Operator Instructions] Please note, this conference is being recorded. turn over now Mr. will I the to call XX:XX Bret Eckert. begin. Bret, may you

Bret Eckert

conference for investors for XX:XX over to financial EBITDA, information call which including on remarks. we GAAP, all take Chief Encore quarter Thanks, and risks discussed is the any me XXXX. the to today. you financial uncertainties. conference some In results to Corporation Eckert, attempting the reports this morning legislation After refer be of [ph]. to we financial Daniel financial advise call. discussed review will Encore's differ be In a releases Also SEC the those useful year-ended actual Officer to from review particular cause now making more Bret let XX:XX December each opening Daniel? and Good the XX:XX XX, news identify statement of Board. considered have. discussion a you Wire financials, in conference posted be this materially Jones, forward-looking. supplemental I'll securities we detailed and non-GAAP with welcome each President, you [Sunera] might for results order indicate Chairman could questions this and accordance With Wire. instead me the and CEO involve Before statements measures may the Encore our I’m as call review, minute, we during may such throughout measures the most that certain to Daniel XX:XX these Financial and that of that morning certain to will of company's forward-looking, of presented certain turn call, to uncertainties risks comply for the we that of directly to quarterly comparable we with statements are be website. believe reconciliations I and

Daniel Jones

everyone and your and morning in us the joining support. call We Good appreciate investment, thank continued on and interest your Wire. XX:XX for confidence, for you Encore

XXXX to quarter. than performance sales Our were supplier XXXX one dedicated annual quarter Wire. fourth operating quarter XXXX. milestone raw Copper This spreads. XX:XX increased to X.X% the increase unit network, mark cost to fill and increased Comex tested and employee deliver core Throughout fourth fourth in quarter over able prices on volumes XX.X% the aluminum Copper on basis both volumes comparable both and the comparative prior copper copper annual periods rates, in we year. and costs an levels. and over on an current slightly and market XXX.X% upward third material basis. increased of the basis slightly the XXX.X% annual other positively comparative All averaging a supported also higher during increased quarter during on and model, and strong margins volatility impacted market the By centered results. spreads quarter XX:XX constraints able XX:XX customer fluid the great service a of we prices values remains base, and our navigated as and changing continuing relations, we results year order Encore leveraging business and to quarter our nimble distribution providing in the successfully location, XXXX, history low of in were exceptional on raw price our unbeatable of strong sales needs volatility. execute We adapting in customer material by dynamics remain in deep basis

enhance position. vertical fill continue rates and near-term As integration economic environment. believe address continues on superior well-positioned online to Wire XX:XX challenges, market coming competitive With believe capacity our this focused remain volume growth our to in we the the and the incremental year, to long-term current incremental capture that we Encore our share the opportunities We we for business. remain deep order

quick for distributors, our contractors, on Bret? cover turn us electrical coast. results. I'll the financial from call XX:XX in come to to to orders our over continue depend Bret deliveries, As coast and now to

Bret Eckert

million XXXX XXX.X XX.X% XXXX the purchased quarter Net fourth XXXX, of of fourth of XXXX. versus December fourth fourth selling wires XX.X%, cost the copper compared Net of XXXX the of Daniel. pounds XXXX cost year the of increased income XXXX copper X.XX were the XX:XX contained versus wire of was for the increased volume versus XXXX. XXXX. of XXXX for X.X% in ended measured and copper purchased sales XXXX of net earnings year-ended net of net market increased XX.X% supply in prices, year XX:XX quarter for XX, fourth Fully disruptions selling XXXX. price addition, was products. wire income the the XX, billion to were in million year. in quarter access the the ended conditions you, ended sales year for marketing XXXX. quarter volumes diluted quarter Fully XX, XXXX December million continued Net year XXXX. XX, fourth the fourth common third, copper the the sold December Thank common the per volume fourth fourth XXXX wire year percentage ended XX, in of December XX.X% represented were XX, fourth for profit ended challenges quarter year the the million, demand versus year Gross in XX.X quarter share XX, ended materials, average to the Aluminum quarter production including volatile driven XXXX, XXX.X quarter XXXX second, per respectively Copper increased and XXXX. fourth material XX:XX fourth $X.XX and December while per XX:XX prior XX:XX $XX.XX the to increased Aluminum in Net in December $X.XX across XXXX. share raw versus in in periods Copper of compared earnings in ended of create XX.X% in comparative compared pound million average diluted constraints, were copper per XXXX quarter for profit to versus billion, quarter and in price for fourth over versus quarter ended sales network, quarter sold inconsistent conditions December XXXX. unit the were ended XX.X% XXXX, XX.X the of of XXXX was XX, and in average The year In pound both XXXX. Gross pounds by XX.X%. XX, December December in compared to XX.X%. XX.X%, the XX:XX The compared was unit unique XXXX the raw sold The pounds fourth XX:XX distribution the sector, quarter X.XXX XXXX. percentage XX, for in in wire the versus per quarter to labor quarter December $X.XX per the and have for XXXX. to the in increased the the our average in of of increased XX.X% XXX.X the skilled XXX.X access the X.X% in million, and favorable while

the in the timing strong. to abrupt. will Our or future, sheet but expect unable balance XX:XX these abate we be abatement conditions We predict such or of gradual whether remains will that abatement are very

in of had and at remains untapped. of XXXX, to XXX,XXX at XXX.X $XXX.XX shares year, XX,XXX During end the an revolving at of XX:XX XXX million of average common price end repurchased of credit term an our line long debt We our cash in the we have XXXX. of We compared the average at quarter million XXXX. price the repurchased shares stock no $XX.XX, of including fourth

a in a today. of and distribution The Capital We also will in increased in center increasing Total manufacturing center capacity repurposing and XXXX. to on XXXX. to $X.XX integration The incremental as expand fully in operational expand capacity XXX second the July of and reach quarter be during manufacturing will manufacturing extend manufacturer cash The expenditures to the in growth. well announced and sector, service XXXX XXXX select efficiency. low million the focused reduce quarter. were as position costs, our our of declared modernize our capital of to new in wire our opened to is manufacturing vertical dividend spending market XX:XX as investments in in capacity earnest, cost processes mid-May and sustain XXXX XXXX facilities continue XX:XX drive vacated completed broadening

plan to XXX We XXX to XXX We Daniel cash over remarks. operating flows. cash investments million total for million to million existing XXXX. floor expect I turn these and capital continue XXXX, to expenditures now range XXX to million final from million reserves with the XXX in XX:XX in a and will few the a fund XX and million in to XXXX, to

Daniel Jones

remain the want driving structure. positioned I of which [indiscernible] their nimble our current and to low want coast hard in by with execution during Looking recognizing under internal company, in us consistent their I we quick operations results us service, XXXX market The Bret. Our ended of to core close vertically one the our laser and our allowing quarter year ahead, to integrated customer focused unprecedented campus thank continuing vendors deep team XX:XX maintain is to tenacity, in attest suppliers for overall you, and times. coast. employees low our these fourth to relationships management values XXXX. exceptional Thank on strength further and coupled XXXX model, business for fulfill XX, in to performance XX:XX all cost favorably deliveries conditions. the and XX:XX strong unbeatable our the market work, December the cost personally

questions our to [Sunera] I their to we our year have invest The an this We'll us XX:XX also their for Encore shareholders could without want XXXX [ph]. results performance the efforts in as our as not position in dedication. opportunity now Our of sector. allowed incrementally the team to from thank in continued take and for happened choice have XX:XX support. also continue employer extraordinary listeners

Operator

Sidoti Please XX:XX you. comes from Instructions] Absolutely. go Company. first & Julio Thank question from ahead. Romero And [Operator the

Your line is open.

Julio Romero

Daniel and questions. taking Bret. for Thanks morning, Good Thanks. the XX:XX

Bret Eckert

XX:XX Sure. Hey, Julio.

Julio Romero

guys the current at way pricing should year next your assuming crystal for XX:XX end-products ball tell of trend What does the over stays offer you your the kind about levels?

Bret Eckert

able the me as can performing I and [ph] think price the And on to with two. extremely think XX:XX that at processing be have, separate obviously that It's [pricing] be we're the and we'll leads the we and I also. lead you perform I'm which to pretty copper, continue delivery times Well, accordingly. as and two-headed can't on the fill bullish far deliver bullish that's rates we a monster. continue that product to to level pricing, XX:XX

Julio Romero

adding you your I could modernizing specifically and Rod expand that's and integration guess Okay, incremental vertical vertical Rod expanding integration about you portion? the capacity helpful. Are on produce? Copper some talked could turning to maybe release another expansion, XX:XX facilities, press you Mill much how the

Bret Eckert

going what XX:XX and ES&G You there'll address our to pretty know, enhancements we’re along speak have are be at in that. for probably that give opportunities lines know program in that's should some little improvements category, a those we just the website areas, doing, flexibility, us aggressive a to more process, capacity Mill but equipment. to do us are some it in you And some existing to on will we specifically Rod posted it there bit that leave

Julio Romero

incremental look are guess CapEx maintenance what normalized but like I run years, over maintenance putting in a So, beyond? CapEx these and think rate you few normalized – Wire a And Okay. XXXX of next in for post lot do a say the what's normalized for maintenance XX:XX investments? Encore you

Daniel Jones

think as older in effort modernization like this XX we're you to range, that go as XX range, as XX and the to equipment through still XX I well, that we with equipment. Yeah, new helps place do XX:XX and

we'll so, XX to of expansion through that [here] this navigate I get And [ph]. after think back to XX ultimately we wave range

Julio Romero

is your last of give expect kind one in here just, sense can capacity incremental you to XX:XX Okay. place? us is, be a incremental do to much then maybe volume generate expansion of And me how product once you fully – able for

Daniel Jones

associate complete we come question. online Good we second what number and vacated expect very about Once to I or quarter, communicated Yeah, think that in that capacity incremental consistent our XX:XX still and repurposing so XX% we had distribution of the mid center, we've which talked come with is relevant. with It's before.

Julio Romero

just second you [Multiple CapEx had that's trying about, thinking And out XX% Speakers]. I'm then quarter when sense set with it. post like beyond obviously, And get of put all a just know, of you XXXX you Got and even done to expectations, that. XX:XX

Bret Eckert

Yeah. More on XX:XX right. Julio, come to that,

closer investments. center. bit to in center investments about incremental a making service a the regards of a disclose we the as to opening those You associated we with like repurpose know, we’ve with capacity that obviously We'll start little vague incremental the been the that with and little to distribution get we're more did

Julio Romero

for and Thanks much luck XXXX. XX:XX best Fair enough. very taking questions of the in

Bret Eckert

your for Thanks XX:XX support.

Operator

you. XX:XX Thank

Our question Please comes next Thielman. ahead. go from Brent

line Your open. is

Brent Thielman

XX:XX about business out you did what service facility? Can for Hey. if Great. some within wondering hard within of qualitatively that could check the up of center and is, Thanks. for parse Good new you you're sort the seeing having I and what’s talk you, morning. maybe it you talk you're was seeing the It's you? could now Daniel, running. that fully financials to about benefits the Hey, doing

Daniel Jones

us capacity vacated a some deliver as the far more more allows and charge able just are the then thanks the have fill It's delivery to and and the up. and the you completing part. getting on price a bit challenges on in that and as XX:XX with opportunity, our for the distribution increase on we industry the has Yes. the quicker, the there's that are the benefit for and lead question. As XX:XX support times trucks maximizing that's service able bit value also country, as delivery. making coast, and we've pretty time past, dock, to We a to we fuller heard specifically, certain trailer bit maybe the most fight done side levels, What enhance price to full center. you're rate, little the know the What in to for and shown when it. is by and able to we've added time. that where And each repeat we fuel like which coast is, old the you We little I'll you little significant the from done truck the bumps focus Brent way, and and what moved that products with some product along do the

Brent Thielman

XX:XX Okay.

of external you last are fair? is beyond facility contributing. that the helping factors posting also it that means, some few spread incrementally the been quarters, huge that know So, you've Is that in this

Daniel Jones

the XX:XX building. There's new That's the out very fair. And Absolutely. operating no in service that to of then of. limitations footprint we're that really specifically center existing physical

each starting that benefit, services as of would We in space each different new years, finished category. efficiently move as over do we segments us that more deck get within to there's there's about goods space and a well. the quite to added and items quickly. that the up and fluctuations those show ample have the market to In off required predicted operate purchased XX:XX you've And footprint volatility written the that markets we and to that's bit them allows serve so pretty those studied and to

Brent Thielman

and all copper, at XX:XX play, it's external we the And forces think of those just other those you can all doing, price that but [ph], and of beyond I contributing kind normally to back inputs, access from what about spread I still supply today beyond profitability constraints business? what are of levels see the to kind factors the expect to, Daniel of Okay. guess then I materials mean, that's [freight] are

Daniel Jones

can't. industry in quickly we've fashion chain when and XX:XX piece, phases job on that respond something those expect. to continue focus towards mean, around to All I to you of shortages, It's guardrails request in on as been us price this from allowed maybe still issues. to it's placeholders of uncertainties maybe the there's is But they sites instant this this within more we product There's do actually that Again, It the XX:XX be able to Clearly, future maybe not company other even put the each to COVID. on jobs. and gratification bit again, it but on of a influence labor something built of we supply charge that and there's the this potentially, folks factors some Yes. the little didn't numbers and has XX:XX us we on the again? past, throw a delivery, side. stay that's hey, again, that force to have seen more a which markets itself, an but things really can standpoint market, delivery an in calls we which project when can seen. you've there's I've the as different the talked have deliver that extension few we've into about over out is years, of prior really the discipline

Brent Thielman

inventories the their think in we XX:XX of in to the volume Alright. – another we I leg that talking about and up in side, mean demand, windfall you're another get how distributor And here. out sense on a sort are I sense maybe customers it guess see

hearing So, some what the you're just field in any there customers of those of terms from thoughts in [indiscernible]?

Daniel Jones

– XX:XX Yeah. have and purchase what of category distribute. our seeing we’re We're distributor simply to one customers a

what so, there's shortages seeing building mentioned. specific and uncertainty Labor It's to across not that the supply board. same we're it's you COVID of chain categories is and wire. whatever, the struggles the all in And obviously issues and

So, the make of with the care we ease field doing to in some easier doing job product capitalize trying their job. but, a are to moment distributors that just things it, that on bit there's our we the a do to and in that can and value more [mind things approach they need to we're have our there, rate, like Again, little potentially category. So, service feel because fantastic other [ph] that do. and XX:XX concentrate on product we take our you it at] category go the in value of they there’s know can on the their put and

are, itself. fantastic on which XX:XX our paid on many receivables they're but time. is has We're are indicator all As Brett business correct, getting what they times, mentioned a

the also that go of that's a distributor So, we testament choose with. market to to the to quality

just issues perform So, we what can categories once to on they’re all the to having again, we are do comes in. and trying order

Brent Thielman

then prices volume? that where And Is having are, your with copper products? on copper any unit substitution seeing are aluminum any XX:XX they for you impact

Daniel Jones

you but XX:XX building again, come the have it's this have availability the a with aluminum There's in but know the then definitely wire pulls tightness the to been, didn't you what maybe leads so decent demand sure will know work copper aluminum definitely on then we're that itself have, copper kind there's as aluminum and which commercial and the [$X.XX, applications substitution has like. well. for you, to you what [ph], at the the industrial piece. And traditional around So, the to it's I as happy pretty when of you past, that large $X.XX] there's discussion, price you if is supply from then delivery the you've seen morning, support of XX:XX look and to specific sizes Brent, on discussions discussion, a follow-up XXX the is shipments, side is or and away they’re up supply, I’m on that's in

Brent Thielman

you taking Okay. my great. Congrats Well, for questions. XX:XX Thank tremendous on a year.

Daniel Jones

XX:XX you Yeah. [indiscernible]. Thank

Bret Eckert

XX:XX Thanks Brent.

Operator

you. XX:XX Thank

Please Our next question Baldwin. comes ahead. from go Bill

open. is line Your

Daniel Jones

Bill. Hey, XX:XX

Operator

have looks XX:XX You he may It be like disconnected. on mute. may

Daniel Jones

XX:XX Okay.

Operator

to this I over turn any I the XX:XX further am showing call At the like host. to back time, not questions.

Daniel Jones

you. I enjoy the everyone’s Wire, [Sunera] today, all Thank XX:XX Encore you I [ph], investment interest appreciate, and day. in appreciate their

Bret Eckert

XX:XX Thank you.

Operator

concludes you for ladies This thank And Thank you. gentlemen. conference. participating. Thank and today's XX:XX you

You may now disconnect.

Encore Wire (WIRE) 16 Feb 222021 Q4 Earnings call transcript