Simpson Manufacturing Co., Inc. Announces 2024 Third Quarter Financial Results

Simpson Manufacturing Co., Inc., headquartered in Pleasanton, California, is a leading manufacturer of wood and concrete construction products. The company recently released its financial results for the third quarter of 2024, providing insights into its performance and future outlook.

Financial Highlights

For the third quarter of 2024, Simpson Manufacturing reported net sales of $587.2 million, marking a 1.2% increase year-over-year. The company's income from operations was $124.9 million, resulting in an operating income margin of 21.3%. Net income per diluted share was $2.21, a decrease from $2.43 in the same period last year. The company also revised its full-year 2024 outlook based on reduced housing start expectations.

Business and Operational Highlights

Simpson Manufacturing's North America segment saw net sales of $461.4 million, a 1.0% increase from the previous year, driven by slightly higher average sales prices and incremental sales from 2024 acquisitions. However, the gross margin decreased to 49.5% from 51.8% due to higher factory and overhead costs. In Europe, net sales increased by 1.8% to $121.2 million, benefiting from new customer wins and product applications, although the gross margin decreased to 36.6% from 37.9%.

Strategic Initiatives and Corporate Developments

During the third quarter, Simpson Manufacturing completed the acquisition of Monet DeSauw Inc. and QuickFrames USA, enhancing its product offerings in the truss industry and commercial construction. The company also reported cash and cash equivalents of $339.4 million and total debt of $465.4 million as of September 30, 2024.

Management's Perspective

Mike Olosky, President and CEO of Simpson Manufacturing, commented on the results, noting that despite challenges in the housing markets in both the U.S. and Europe, the company managed to achieve modest sales growth. He highlighted the strength in the national retail, component manufacturer, and OEM markets in North America, which offset weaknesses in residential and commercial sectors. Olosky also mentioned the company's efforts to align costs with market conditions to improve profitability.

Future Outlook

Looking ahead, Simpson Manufacturing expects U.S. housing starts to decline in the low single-digit range for 2024, with growth anticipated in 2025. In Europe, housing starts are expected to decrease in the high single-digit range, with significant growth projected for 2026 and beyond. The company estimates its operating margin for 2024 to be between 19.0% and 19.5%, with capital expenditures ranging from $175.0 million to $185.0 million.

SEC Filing: Simpson Manufacturing Co., Inc. [ SSD ] - 8-K - Oct. 21, 2024