Eagle Materials Inc. Reports First Quarter Earnings
For the quarter ended June 30, 2007, revenues and net earnings were $221.2 million and $38.7 million, respectively
DALLAS, July 30 /PRNewswire-FirstCall/ -- Eagle Materials Inc.(NYSE:EXP)today reported financial results for the first quarter of fiscal 2008 ended June 30, 2007. Eagle produces and distributes Gypsum Wallboard, Cement, Recycled Paperboard and Concrete and Aggregates.
For the quarter ended June 30, 2007, revenues and net earnings were $221.2 million and $38.7 million, respectively. The current contraction in U.S. homebuilding negatively impacted our wallboard sales volumes and pricing, causing our revenues to decline by 15% from the prior year's first quarter and our net earnings to decline 35% from the same period last year. Diluted earnings per share for the first quarter of fiscal 2008 were $0.80.
Eagle remains well positioned to adapt to changing industry conditions because of our low-cost, diversified mix of construction products and building materials. In fact, all of Eagle's business lines, with the exception of our gypsum wallboard business, experienced a year-over-year increase in operating earnings this quarter.
Demand for cement in the U.S. remains at high levels requiring approximately 25% of total U.S. cement needs to be met by foreign imports. Cement demand in some U.S. regions has been negatively impacted by seasonal weather events, while in other regions it has been more severely impacted by the residential slowdown; however, underlying cement demand in all four of our regional markets remains at high levels. Due to this strength in our cement markets, we expect fiscal 2008 to be our 22nd consecutive year of selling out our four cement plants.
The Gypsum Association reported that approximately 15.8 billion square feet of wallboard was shipped by U.S. manufacturers during the first six months of calendar 2007, a 17% decrease from the prior year, and industry utilization averaged approximately 83% over this time period. Significant excess housing inventories continue to put downward pressure on new residential construction and the outlook for residential construction remains weak. Weak residential construction, combined with the new wallboard capacity that has begun to enter the market, will continue to negatively impact wallboard industry capacity utilization until older, high cost plants are closed.
GYPSUM WALLBOARD
Gypsum Wallboard revenues for the first quarter totaled $104.8 million, a 29% decrease from the $147.7 million for the same quarter a year ago. Gypsum Wallboard's first quarter operating earnings were $27.2 million, down 58% from the $64.0 million for the same quarter last year. The revenue and earnings decline for the quarter resulted from lower sales prices and sales volumes. The average net sales price for this fiscal year's first quarter was $128 per MSF, 24% less than the $168 per MSF for the same quarter last year. Gypsum Wallboard sales volume of 642 million square feet (MMSF) for the quarter declined 13% from the prior year's first quarter.
CEMENT
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