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PGT Reports 2008 Fourth Quarter and Fiscal Year Results

Post Time:Feb 20,2009Classify:Company NewsView:251

PGT, Inc. (Nasdaq:PGTI), the leading U.S. manufacturer and supplier of residential impact-resistant windows and doors, today announced financial results for its fourth quarter and year ended January 3, 2009.

"The tightening of credit from the mortgage crisis was one of several factors that took a firm grip on the economy in the fourth quarter causing substantial downward pressure on the home building industry. New home construction slowed to a pace not seen in two decades. Housing starts were down 38% in our core market in the fourth quarter of 2008 compared to 2007, and our sales decreased 9.3%," said Rod Hershberger, PGT's President and Chief Executive Officer. "We think the housing market and conditions in the economy will remain difficult, or even worsen in 2009, and it remains to be seen if the federal stimulus package will have beneficial economic effects. Because the timing of any recovery in our industry is uncertain, we recently reduced our workforce and better aligned costs with recent sales levels. Decisions like these are very difficult, but they position us to weather these unprecedented economic times and to continue moving forward with new product offerings and line expansions and to pursue growth opportunities outside of Florida. We continue to believe that we can grow organically by gaining market share, but remain focused on controlling costs and conserving cash."

2008 Fourth Quarter and Fiscal Year Financial Results:

(See accompanying financial schedules for financial details and reconciliations of adjusted (non-GAAP) financial measures to their GAAP equivalents. Certain comparisons may be affected by the fact that the 2008 fourth quarter had 14 weeks and the 2007 fourth quarter had 13 weeks.)

--  Net sales were $49.3 million in the fourth quarter of 2008, a decrease of $5.0 million, or 9.3%, compared to the fourth quarter of 2007.  For the year, net sales were $218.6 million, a decrease of $59.8 million, or 21.5%, compared to 2007.

--  Gross margin percentage in the fourth quarter of 2008 was 29.5%, compared to 27.1% in the fourth quarter of 2007, and was 31.2% for 2008, compared to 32.7% in 2007.  Gross margin percentage in the fourth quarter of 2008 compared to 2007 improved due to cost savings actions taken during 2008, but decreased for the year due mainly to declining operating leverage from lower sales.

--  Non-cash impairment charges totaling $94.1 million were recorded in the fourth quarter of 2008, bringing non-cash impairment charges to a total of $187.7 million in 2008.

--  SG&A was $16.2 million for the fourth quarter of 2008, a decrease of $1.8 million from the fourth quarter of 2007, and $63.1 million for 2008, a decrease of $13.9 million from 2007. Lower personnel costs from cost-alignment initiatives and lower distribution and selling costs associated with lower sales volumes contributed to the decreases.  SG&A was 32.9% of sales for the fourth quarter of 2008 compared to 33.1% in the fourth quarter of 2007 and 28.9% for 2008 compared to 27.7% in 2007.

--  There was a net loss in the fourth quarter of 2008 of $83.0 million, compared to a net loss of $4.0 million for the fourth quarter of 2007.  For the year of 2008, there was a net loss of $163.0 million, compared to net income of $0.6 million in 2007. The net losses in the fourth quarter and year of 2008 were driven by non-cash impairment charges of $94.1 million in the fourth quarter and $187.7 million for the year and restructuring costs of $0.4 million in the fourth quarter and $2.1 million for the year. Adjusting for these charges and related tax impacts, there was a net loss of $2.3 million in the fourth quarter and a net loss of $1.5 million in 2008, compared to an adjusted net loss of $2.6 million in the fourth quarter and adjusted net income of $2.6 million in 2007.

--  On an adjusted basis, net loss per diluted share for the fourth quarter of 2008 was $0.06, compared to $0.09 in the fourth quarter of 2007.  For the full year of 2008, adjusted net loss was $0.05, compared to an adjusted net income of $0.09 in 2007.

--  Adjusted EBITDA for the fourth quarter of 2008 was $3.0 million compared to $3.0 million in the fourth quarter of 2007. Adjusted EBITDA for 2008 was $24.4 million compared to $31.7 million in 2007.

Commenting on the fourth quarter and fiscal 2008, Jeff Jackson, PGT's Executive Vice President and Chief Financial Officer, stated, "Economic pressures that began intensifying in the third quarter, further intensified in the fourth quarter having significant negative effects on the housing market and the overall economy. Unemployment continued to rise, home prices fell further, foreclosures increased and credit remained tight, resulting in consumer confidence falling to its lowest level in more than a decade. Our sales continued to be impacted in the fourth quarter as sequential quarter sales fell $5.0 million. For the year, sales fell to $218.6 million from $278.4 million in 2007. The resulting decrease in our ability to leverage fixed costs negatively affected our results. Despite a sales decrease of $59.8 million, our adjusted EBITDA fell only $7.2 million due to the actions we took to adjust our cost structure and operational improvements."

Mr. Jackson continued, "We made some difficult decisions over the last year, and actions we took to align our costs with decreasing sales volumes, although regrettable, were necessary for the long-term health of the company. Due to these actions, coupled with effective management of working capital and the success of our rights offering, we ended the year with as much cash on hand as at the beginning of the year and were able to prepay $40 million of outstanding bank debt."

Conference Call

As previously announced, PGT will hold a conference call Thursday, February 19, 2009, at 10:30 a.m. Eastern Time and will simultaneously broadcast it live over the Internet. To participate in the teleconference, please dial into the call a few minutes before the start time: 877-723-9521 (U.S. and Canada) and 719-325-4833 (international). A replay of the call will be available beginning February 19, 2009, at 1:30 p.m. Eastern Time through March 5, 2009. To access the replay, dial 888-203-1112 (U.S. and Canada) or 719-457-0820 (international) and refer to passcode 8347505. The webcast will also be available through the Investor Relations section of the PGT, Inc. website,

Source: GLOBE NEWSWIREAuthor: shangyi

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