Gypsum industry news
Eagle Materials revenue rises 9%
12 November 2019US: Eagle Materials has reported financial results for the second quarter of its 2020 fiscal year, a period that ended on 30 September 2019. Its overall revenue was US$414.5m for the period, a 9% year-on-year improvement.
Gypsum wallboard and paperboard revenue declined slightly from the prior year, as improved sales volume was offset by lower pricing. Gypsum Wallboard sales volume reached 63.3Mm3 (681Mft2), a rise of around 8% year-on-year, while the average Gypsum Wallboard net sales price declined by 10% to US$13.78Mm2 (US$148.16/Mft2).
Paperboard sales volume for the quarter also increased, up by 9% to a record 86,000t. The average paperboard net sales price was US$475.98/t, down by 6% from the prior year, consistent with the pricing provisions in our long-term sales agreements.
Operating earnings were US$48.6m in the sector, a decline of 11%, reflecting improved wallboard and paperboard sales volume offset by lower net sales prices. Operating costs during the quarter declined primarily due to lower recycled fibre costs.
Eagle Materials gypsum wallboard sales fall in first quarter
01 August 2019US: Eagle Materials’ revenue from its gypsum wallboard business fell by 11% year-on-year to US$127m in the first quarter of its financial year to 30 June 2019 from US$142m in the same period in 2018. Its earnings dropped by 25% to US$37.9m from US$50.5m. Wallboard sales volumes decreased by 7% to 61Mm2 from 66Mm2. It attributed the loss of revenue on lower volumes and poor pricing although it said that buying activity around a price increase in July 2019 suggested that the market was ‘healthy.’
US: Eagle Materials has approved a plan to spin off its heavy materials and light materials businesses into two publicly traded entities, bowing to pressure from hedge fund Sachem Head Capital Management.
Sachem, which disclosed a 9% stake in Eagle Materials in March 2019, had earlier urged Eagle to separate its cement and wallboard businesses. After the split, Eagle’s heavy materials business will operate as a cement company, and the light materials business will continue to make gypsum wallboard and recycled paperboard.
“We believe that by pursuing the actions announced today the Eagle board is taking significant steps to unlock the company’s inherent value,” said Sachem Managing Partner Scott Ferguson, also commenting on planned changes to Eagle’s oil and gas proppants businesses.
The separation will be by a tax-free spin-off to Eagle shareholders and is expected to be completed in the first half of 2020. Both the new companies will have their headquarters in Dallas, Texas.
US: Eagle Materials’ gypsum wallboard and paperboard sales grew by 5% year-on-year to US$634m in the year to 31 March 2019 from US$603m in the same period in 2017. Its gypsum wallboard sales volumes increased by 4% to 246Mm2 from 237Mm2. Operating earnings from this division rose by 13% to US$216m from US$191m. Sales were driven by higher sales volumes and prices. Overall, the company’s sales and earnings grew slightly.
US: Michael Haack has been appointed as the chief executive officer (CEO) of Eagle Materials. He succeeds Dave Powers, who will retire on 1 July 2019. Powers will remain on the company’s board of directors.
Haack is currently Eagle Material’s president and chief operating officer (COO). He joined Eagle Materials as COO in 2014 from Halliburton Energy Services, where he worked for 17 years. He holds an MBA from Rice University in Texas, as well as Master and Bachelor degrees in Industrial Engineering from Texas A&M and Purdue University, respectively.
Powers has worked in the building materials industry for 40 years. He joined Eagle Materials, formerly known as Centex Construction Products, in 2002. In 2005 he was promoted to Executive Vice President for Gypsum. He became president and CEO of Eagle Materials in early 2016.
Eagle Materials grows gypsum wallboard business
30 January 2019US: Eagle Materials’ revenue rose slightly to US$1.11bn in the nine months to 31 December 2018. Revenue from its Light Materials business, including gypsum wallboard, grew by 3% to US$479m from US$467m. Gypsum wallboard production dropped slightly to 185Mm2. Operating earnings increased by 13% to US$166m from US$146m.
“Adjusting for the effects of unusual weather trends during 2018 and a shift in the timing of wallboard price increases and related buying activity, we estimate that the overall market demand for our building materials, notably cement and wallboard, remained in positive territory in 2018, with growth rates in the low single digits,” said chief executive officer (CEO) Dave Powers.
US: Eagle Materials’ sales revenue from gypsum wallboard rose in the first half of its financial year to 30 September 2018 due to higher prices. Its revenue from wallboard grew by 9% year-on-year to US$272m from US$250m. Its wallboard sales volumes increased by 3% to 124Mm2 from 121Mm2. The building materials producer said that Hurricane Florence had disrupted its southeastern markets reducing salese in the second quarter. Overall, the company’s sales across all businesses rose.
Eagle Materials records record revenues
12 February 2018US: Eagle Materials has reported its financial results for the third quarter of the 2018 fiscal year, which ended on 31 December 2017. It recorded record revenues of US$359.4m, a rise of 19% compared to the same period of the 2017 fiscal year.
Gypsum wallboard and paperboard revenues for the third quarter of the 2018 fiscal year totalled US$162.6m, which were 11% greater than the same quarter a year ago. The average gypsum wallboard net sales price this quarter was US$151.13/MSF, 1% less than the same quarter a year ago. Gypsum wallboard sales volumes were a third quarter record of 709MMSF, a 10% increase from the same quarter last year. Paperboard sales volumes for the quarter were also a record and 7% greater than the same quarter a year ago. The average paperboard net sales price for the quarter was US$581.95/t, 11% greater than the same quarter a year ago.
Gypsum wallboard and paperboard activities reported third quarter operating earnings of US$50.7m, up by 1% from the same quarter last year. The earnings improvement primarily reflects improved gypsum wallboard and paperboard sales volumes and higher average paperboard net sales prices.
During the third quarter, Eagle and its subsidiary, American Gypsum, entered into settlement agreements with counsel representing the direct and indirect purchaser classes to settle all claims made against the company and American Gypsum. Pursuant to the settlement agreements, which remain subject to court approval, the Company and American agreed to make payments totalling approximately US$39m. Eagle and American Gypsum continue to deny all wrongdoing but settled to avoid further litigation expense, distraction of management, and the risk of litigation. Eagle expects to make this cash payment in the next 12 months.
National Gypsum, Eagle Materials and PABCO Building Products agree to US$125m settlement in competition claim
04 January 2018US: National Gypsum, Eagle Materials and PABCO Building Products have agreed to pay US$125m to settle claims that they fixed the price of gypsum wallboard. A preliminary motion to approve the settlement is scheduled to be filed in January 2018, said David Young, a partner at Cohen Milstein Sellers & Toll, a lead plaintiffs’ firm in the litigation, according to the Legal Intelligencer newspaper. The legal firm and others are representing wallboard customers, including distributors and installers.
The three wallboard producers are the last of seven defendants of a lawsuit that started in 2013. Previous deals with Lafarge North America, Temple Inland and USG bring the total amount of settlements for direct purchasers in the case to over US$190m. A seventh company, CertainTeed, was granted summary judgment in 2016.
Eagle Materials grows wallboard revenue
28 July 2017US: Eagle Materials' revenue has risen by 23% year-on-year to US$366.1m in the first quarter of its 2018 fiscal year, which runs 1 April – 30 June 2017. Its first quarter earnings before interest and income taxes increased by 22%, reflecting improved sales volumes and net sales prices across nearly all businesses.
Eagle Materials' Gypsum Wallboard and Paperboard revenues for the first quarter totalled US$154m, 9% higher year-on-year. The average gypsum wallboard net sales price in the quarter rose by 10% to US$1711/Mm2 (US$159/MSF). Gypsum wallboard sales volumes rose by 11% to 60Mm2 (654MMSF). Paperboard sales volumes fell by 5% to 79,000t, reflecting the timing of third-party purchases. The average paperboard net sales price rose by 10% to US$550/t.
Gypsum wallboard and paperboard reported first quarter operating earnings fell by 4% to US$48.8m. The earnings decline primarily reflected increased operating costs at Eagle Materials' paper mill due to the timing of its annual maintenance outage and higher recycled fibre costs, partially offset by improved wallboard sales volumes and sales prices.