American Woodmark Corporation Announces First Quarter Results

WINCHESTER, Va., Aug. 22, 2017

Net sales for the first fiscal quarter increased 7% to $276.8 million compared with the same quarter of the prior fiscal year.  The Company experienced growth in both the new construction and dealer channels during the first quarter of fiscal year 2018.

Net income was $22.3 million ($1.36 per diluted share) for the first quarter of the current fiscal year compared with $21.7 million ($1.32 per diluted share) for the first quarter of the prior fiscal year.  The Company benefited $0.13 per diluted share in the first quarter of the current fiscal year and $0.06 per diluted share in the first quarter of the prior fiscal year from a lower tax rate due to a benefit from stock-based compensation transactions.

Gross profit for the first quarter of the current fiscal year was 21.1% of net sales compared with 23.0% in the same quarter of the prior year.  Gross profit in the current quarter was unfavorably impacted by higher transportation costs, material inflation and higher healthcare costs.  The prior year quarter benefited from an unusually low healthcare spend.

Selling, general and administrative costs for the first quarter of the current fiscal year were 10.0% of net sales compared with 10.6% in the same quarter of the prior year.  The decrease in the Company's operating expense ratio was driven by favorable leverage from increased sales and lower incentive compensation costs.

The Company generated net cash from operating activities of $26.6 million during the first quarter of fiscal year 2018 compared with $32.9 million during the same period in the prior year.  The decline in the Company's cash from operating activities was driven primarily by higher inventories to support increased sales and lower increases in accounts payable.  Net cash used by investing activities was $21.2 million during the first quarter of the current fiscal year compared with $40.6 million during the same period of the prior year due to a $25.5 million reduced investment in certificates of deposit which was partially offset by increased investment in property, plant and equipment.  Net cash used by financing activities of $6.8 million increased $2.5 million during the first quarter of the current fiscal year compared to the same period in the prior year as the company repurchased 56,700 shares of common stock at a cost of $5.6 million, a $0.5 million increase from the prior year, and proceeds from the exercise of stock options decreased $0.8 million.

American Woodmark Corporation manufactures and distributes kitchen cabinets and vanities for the remodeling and new home construction markets.  Its products are sold on a national basis directly to home centers, major builders and through a network of independent distributors.  The Company presently operates nine manufacturing facilities and seven service centers across the country.