GRAND RAPIDS, Mich., April 21, 2021 (GLOBE NEWSWIRE) -- UFP Industries, Inc. (NASDAQ:UFPI) today announced record net sales of $1.83 billion for the first quarter of 2021, a 77 percent increase over the first quarter of 2020, and record net earnings attributable to controlling interest of $103 million, a 157 percent increase over the same period of 2020. The company also reported record EPS of $1.67 per diluted share compared to $0.65 in the first quarter last year. While first quarter performance is typically limited by seasonality, net sales and earnings for the first quarter of 2021 were the highest of any quarter in company history.

"UFP Industries is enjoying unprecedented growth as we benefit from strong market conditions and the successful execution of our strategic plans. We are using our new market-focused structure to target and quickly assimilate acquisitions, better leverage our fixed costs, and reallocate resources to increase capacity efficiently," said CEO Matthew J. Missad. "As a result, we are experiencing strong organic growth in our retail and industrial segments as well as in our site-built and factory-built housing business units. Our improvement in gross profit resulted from these changes, as well as a better pricing model that quickly adjusts to lumber market fluctuations and our growing line-up of new and value-added products. I want to thank our employees for their outstanding efforts and especially recognize our general managers for the improvements they've made at our facilities. I remain very encouraged about the growth prospects for our business as we look forward."

The elevated level of softwood lumber prices contributed to a significant increase in the company's cost of materials and was responsible for 44 percent of the 77 percent increase in net sales. The remaining 33 percent came from increased unit sales – 23 percent from acquisitions and 10 percent from organic growth.

New product sales of $159.4 million increased 58 percent over the first quarter of 2020, led by Deckorators Vault decking and deck accessories, UFP-Edge shiplap and trim, Handprint project panels and ProWood Fire Retardant treated lumber.

First Quarter 2021 Highlights (comparisons on a year-over-year basis):

Net sales of $1.83 billion increased 77 percent due to a 33 percent increase in unit sales and 44 percent increase in selling prices
An increase in SG&A of nearly $41 million, or 37 percent, is largely attributable to recent acquisitions ($11.5 million, including amortization expense of $1.7 million), accrued bonus expenses ($22.5 million) resulting from increased profitability, and increased compensation costs of $10 million, offset by net decreases of $3 million in travel costs and bad debt expense
Earnings from operations of $137.5 million increased 134 percent
Adjusted EBITDA of $162.7 million increased 111 percent

UFP Industries maintains a strong balance sheet with liquidity of approximately $421 million at the end of the first quarter. The company's operating cash flow decreased by approximately $150 million as a result of a greater seasonal investment in net working capital of $216 million associated with higher accounts receivable and to build inventory to satisfy strong customer demand, particularly in the retail business. Net debt increased to $429 million from $131 million at the end of the first quarter of 2020 due to these factors and the acquisition of PalletOne and its wholly owned subsidiary, Sunbelt Forest Products.

On April 12, 2021, Sunbelt (an affiliate of UFP Retails Solutions) completed its acquisition of Spartanburg Forest Products and its affiliates, expanding its pressure-treating capacity throughout the eastern U.S. In addition, on April 19, 2021, UFP closed on the purchase of Walnut Hollow Farm, which produces a variety of finely finished wood surfaces used in hobby, craft and woodworking projects, as well as in taxidermy. Both transactions broaden UFP Retail Solutions' customer base and product offerings.

"The recent acquisitions of Sunbelt and Spartanburg not only allow us to leverage costs and improve efficiencies in wood treating, they allow us to bring our value-added products to a broader and more diverse customer base. UFP will continue to pursue acquisitions that expand our capacity, enhance our capabilities, improve efficiencies and increase our sales of value-added products," said Missad. "Growth is baked into our DNA, and I'd encourage those looking for attractive career opportunities to consider UFP during this dynamic time. We are hiring at nearly every location in many roles and currently have about 500 jobs available for hard working, highly motivated future team members."

By business segment, the company reported the following first quarter 2021 results:

UFP Retail Solutions

$759 million in net sales, up 116 percent over the first quarter of 2020 due to a 56 percent increase in selling prices, a 19 percent increase in organic unit sales, and a 41 percent unit increase resulting from acquisitions, primarily Sunbelt Forest Products. Organic unit growth was driven by Deckorators (up 64 percent), Handprint (up 30 percent), Outdoor Essentials (up 28 percent), and UFP Edge (up 24 percent). Gross profit for the segment grew 122 percent. Acquisitions contributed over $10 million, or almost 23 percent, to the increase in gross profit.

UFP Industrial

$448.9 million in net sales, up 75 percent from the first quarter of 2020. Unit sales increased 37 percent and selling prices increased 38 percent. Organic growth accounted for 5 percent of the unit sales growth; the acquisitions of PalletOne and T&R Lumber accounted for 32 percent. Gross profit for the segment rose 83 percent, far exceeding unit sales growth, due to the company's focus on adding value-added products and its ability to effectively increase capacity. PalletOne and T&R Lumber contributed over $13 million, or 30 percent, to the increase in gross profit.

UFP Construction

$559.5 million in net sales, up 47 percent over the first quarter of 2020, due to an 8 percent increase in unit sales and a 39 percent increase in selling prices. Unit sales to site-built and factory-built housing customers rose 21 percent and 15 percent, respectively. Unit sales to commercial customers fell 9 percent. Gross profit for the construction segment grew 40 percent over the first quarter of 2020, led by the site-built and factory-built business units.

CONFERENCE CALL

UFP Industries will conduct a conference call to discuss information included in this news release and related matters at 4:30 p.m. ET on Wednesday, April 21, 2021. The call will be hosted by CEO Matthew J. Missad and CFO Michael Cole, and will be available for analysts and institutional investors domestically at 866-518-4547 and internationally at 213-660-0879. Use conference pass code 6679712. The conference call will be available simultaneously and in its entirety to all interested investors and news media through a webcast at http://www.ufpi.com. A replay of the call will be available through April 23, 2021, at 855-859-2056, 404-537-3406 or 800-585-5367.

UFP Industries, Inc.

UFP Industries is a holding company whose operating subsidiaries – UFP Industrial, UFP Construction and UFP Retail Solutions – manufacture, distribute and sell a wide variety of value-added products used in residential and commercial construction, packaging and other industrial applications worldwide. Founded in 1955, the company is headquartered in Grand Rapids, Mich., with affiliates in North America, Europe, Asia and Australia. For more about UFP Industries, go to www.ufpi.com.

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, as amended, that are based on management's beliefs, assumptions, current expectations, estimates and projections about the markets we serve, the economy and the Company itself. Words like "anticipates," "believes," "confident," "estimates," "expects," "forecasts," "likely," "plans," "projects," "should," variations of such words, and similar expressions identify such forward-looking statements. These statements do not guarantee future performance and involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. The Company does not undertake to update forward-looking statements to reflect facts, circumstances, events, or assumptions that occur after the date the forward-looking statements are 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 from forward-looking statements are the following: fluctuations in the price of lumber; adverse or unusual weather conditions; adverse economic conditions in the markets we serve; government regulations, particularly involving environmental and safety regulations; and our ability to make successful business acquisitions. Certain of these risk factors as well as other risk factors and additional information are included in the Company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission.

Non-GAAP Financial Information

This release includes certain financial information not prepared in accordance with U.S. GAAP. Because not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Management considers Adjusted EBITDA, a non-GAAP measure, an alternative performance measure which may provide useful information to investors.

Net earnings

Net earnings refers to net earnings attributable to controlling interest unless specifically noted.

---------------AT THE COMPANY---------------

Dick Gauthier

VP, Business Outreach

(616) 365-1555

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2021/2020


	Quarter Period										Year to Date
(In thousands, except per share data)	2021					2020					2021					2020
NET SALES	$	1,825,004		100.0	%	$	1,032,062		100.0	%	$	1,825,004		100.0	%	$	1,032,062		100.0	%

COST OF GOODS SOLD		1,538,450		84.3			864,826		83.8			1,538,450		84.3			864,826		83.8

GROSS PROFIT		286,554		15.7			167,236		16.2			286,554		15.7			167,236		16.2

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		150,098		8.2			109,339		10.6			150,098		8.2			109,339		10.6
ASSET IMPAIRMENT CHARGES AND OTHER COSTS, NET		(1,031	)	(0.1	)		(735	)	(0.1	)		(1,031	)	(0.1	)		(735	)	(0.1	)

EARNINGS FROM OPERATIONS		137,487		7.5			58,632		5.7			137,487		7.5			58,632		5.7

OTHER EXPENSE, NET		1,485		0.1			4,740		0.5			1,485		0.1			4,740		0.5

EARNINGS BEFORE INCOME TAXES		136,002		7.5			53,892		5.2			136,002		7.5			53,892		5.2

INCOME TAXES		31,751		1.7			13,322		1.3			31,751		1.7			13,322		1.3

NET EARNINGS		104,251		5.7			40,570		3.9			104,251		5.7			40,570		3.9

LESS NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST		(940	)	(0.1	)		(411	)	—			(940	)	(0.1	)		(411	)	—

NET EARNINGS ATTRIBUTABLE TO CONTROLLING INTEREST	$	103,311		5.7		$	40,159		3.9		$	103,311		5.7		$	40,159		3.9

EARNINGS PER SHARE - BASIC	$	1.67				$	0.65				$	1.67				$	0.65

EARNINGS PER SHARE - DILUTED	$	1.67				$	0.65				$	1.67				$	0.65

COMPREHENSIVE INCOME		102,055					32,014					102,055					32,014

LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST		(414	)				1,924					(414	)				1,924

COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST	$	101,641				$	33,938				$	101,641				$	33,938

SUPPLEMENTAL DATA
	Quarter Period								Year to Date
Segment Classification	2021			2020			%		2021			2020			%
Retail	$	759,021		$	352,161		115.5	%	$	759,021		$	352,161		115.5	%
Industrial		448,873			256,543		75.0	%		448,873			256,543		75.0	%
Construction		559,531			381,155		46.8	%		559,531			381,155		46.8	%
All Other		57,579			42,203		36.4	%		57,579			42,203		36.4	%
Total Net Sales	$	1,825,004		$	1,032,062		76.8	%	$	1,825,004		$	1,032,062		76.8	%


	2021			2020					2021			2020
SG&A as a Percentage of Gross Profit		52.4	%		65.4	%				52.4	%		65.4	%

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
MARCH 2021/2020

(In thousands)
ASSETS		2021	2020		LIABILITIES AND EQUITY		2021		2020

CURRENT ASSETS					CURRENT LIABILITIES
Cash and cash equivalents	$	44,399	$	32,129	Cash overdraft	$	47,140	$	—
Restricted cash		629		724	Accounts payable		299,398		162,039
Investments		31,439		17,778	Accrued liabilities		265,412		164,444
Accounts receivable		808,105		460,821	Current portion of debt		109		2,772
Inventories		823,414		510,681
Other current assets		29,072		38,776

TOTAL CURRENT ASSETS		1,737,058		1,060,909	TOTAL CURRENT LIABILITIES		612,059		329,255

OTHER ASSETS		149,393		124,519
INTANGIBLE ASSETS, NET		415,402		299,979	LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS		426,310		160,550
					OTHER LIABILITIES		165,308		120,895
PROPERTY, PLANT AND EQUIPMENT, NET		488,367		397,575	EQUITY		1,586,543		1,272,282


TOTAL ASSETS	$	2,790,220	$	1,882,982	TOTAL LIABILITIES AND EQUITY	$	2,790,220	$	1,882,982

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2021/2020


(In thousands)	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	104,251		$	40,570
Adjustments to reconcile net earnings to net cash from operating activities:

Depreciation		18,733			15,717
Amortization of intangibles		3,998			1,571
Expense associated with share-based and grant compensation arrangements		2,981			1,444
Deferred income taxes		142			286
Unrealized loss (gain) on investment and other		(1,754	)		3,173
Equity in earnings of investee		630
Net loss (gain) on disposition and impairment of assets		(532	)		(285	)
Changes in:
Accounts receivable		(253,323	)		(94,253	)
Inventories		(207,768	)		(25,783	)
Accounts payable and cash overdraft		121,892			20,047
Accrued liabilities and other		14,090			(8,648	)
NET CASH FROM OPERATING ACTIVITIES		(196,660	)		(46,161	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment		(34,656	)		(27,286	)
Proceeds from sale of property, plant and equipment		5,062			409
Acquisitions and purchase of noncontrolling interest, net of cash received		(261,133	)		(18,487	)
Purchases of investments		(8,738	)		(14,052	)
Proceeds from sale of investments		3,381			11,260
Other		(414	)		(54	)
NET CASH USED IN INVESTING ACTIVITIES		(296,498	)		(48,210	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit facilities		236,280			6,759
Repayments under revolving credit facilities		(121,570	)		(6,498	)
Contingent consideration payment and other		(627	)		(3,074	)
Proceeds from issuance of common stock		363			319
Dividends paid to shareholders		(9,274	)		(7,730	)
Distributions to noncontrolling interest		(2,914	)		(299	)
Repurchase of common stock		0			(29,212	)
Other		(331	)		12
NET CASH FROM (USED IN) FINANCING ACTIVITIES		101,927			(39,723	)

Effect of exchange rate changes on cash		(349	)		(1,719	)
NET CHANGE IN CASH AND CASH EQUIVALENTS		(391,580	)		(135,813	)

ALL CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		436,608			168,666

ALL CASH AND CASH EQUIVALENTS, END OF PERIOD	$	45,028		$	32,853

Reconciliation of cash and cash equivalents and restricted cash:
Cash and cash equivalents, beginning of period	$	436,507		$	168,336
Restricted cash, beginning of period		101			330
All cash and cash equivalents, beginning of period	$	436,608		$	168,666

Cash and cash equivalents, end of period	$	44,399		$	32,129
Restricted cash, end of period		629			724
All cash and cash equivalents, end of period	$	45,028		$	32,853

ADJUSTED EBITDA RECONCILIATION (UNAUDITED)
FOR THE THREE MONTHS ENDED
MARCH 2021/2020


	Quarter Period						Year to Date
(In thousands)	2021			2020			2021			2020
Net earnings	$	104,251		$	40,570		$	104,251			$	40,570
Interest expense		3,151			1,908			3,151				1,908
Interest and investment income		(542	)		(341	)		(542	)			(341	)
Income taxes		31,751			13,322			31,751				13,322
Expenses associated with share-based compensation arrangements		2,981			1,444			2,981				1,444
Net loss (gain) on disposition and impairment of assets		(532	)		(285	)		(532	)			(285	)
Equity in earnings of investee		630			0			630				0
Unrealized (gain) loss on investments		(1,754	)		3,173			(1,754	)			3,173
Depreciation expense		18,733			15,717			18,733				15,717
Amortization of intangibles		3,998			1,571			3,998				1,571
Adjusted EBITDA	$	162,667		$	77,079		$	162,667			$	77,079

UFP Industries Reports All-time Quarterly Records