Gypsum industry news
Belgium: Etex's sales revenue has fallen by 2.8% year-on-year to Euro1.48bn in the first half of 2016 from Euro1.52bn in the same period in 2015. However, on a like-for-like basis the group said that its revenue rose by 2.6% when exchange rates and scope were taken into account. Its profit fell by 12% to Euro55m from Euro63m.
The group reported that markets in Germany and France remain weak due to manufacturing capacity being downsized. In Latin American countries growth was realised with the exception of Brazil. The profitability of this growth was under pressure from exchange rates and increased competition.
ABC Supply to buy L&W Supply from USG for US$670m 30 August 2016
US: ABC Supply and USG have entered into a agreement in which ABC Supply will acquire USG's building product distribution business, L&W Supply Corporation for US$670m. The transaction is subject to customary closing conditions, including regulatory approvals, and is expected to be completed before the end of 2016.
"As a world-class distributor of interior building materials, L&W reinforces ABC's leadership position in building materials distribution, and helps set the stage for our next phase of growth," said Keith Rozolis, ABC Supply's President and Chief Executive Officer.
Completion of the transaction will allow USG to reduce debt and achieve its target leverage ratio, accelerate high return investments in its Gypsum and Ceilings businesses through advanced manufacturing initiatives, and position the company to consider future capital returns to shareholders. The sale of L&W Supply is also expected to dampen USG's overall earnings cyclicality as well as provide opportunity for growth in the independent specialty dealer channel.
L&W Supply is one of the largest distributors of gypsum wallboard and suspended ceiling tiles in the US, serving its customers from 136 branches. ABC Supply is a wholesale distributor of roofing, siding, windows and gutter materials. The acquisition of L&W Supply will allow it to expand into the interior of the building through the sale of gypsum wallboard and suspended ceiling tiles and grid.