Gypsum industry news

Japan: Chiyoda Ute Co Ltd has released consolidated financial results for the nine months to 31 December 2011. These show that sales increased by nearly 10% year-on-year to US$264.8m, while the company's operating profit came in at US$5.7m compared to a loss of US$9.6m a year earlier. The company made a net profit of US$2.8m, up from a loss of US$13.7m in the first nine months of the previous fiscal year.

The company expects to make a full year net profit of US$7.4m in the current fiscal year (ending 31 March 2012) from sales of US$375m.

US: USG Corporation has reported fourth quarter 2011 net sales of US$750m, up by nearly 8% from its fourth quarter 2010 net sales of US$696m. Its operating loss for the fourth quarter was US$42m, whereas in the same quarter of 2010 it was US$95m. Its fourth quarter 2011 net loss after-tax was US$100m, down from the US121m net loss a year earlier.

"While some markets remain at or near historically low levels, all of our businesses continue to benefit from the strategic actions we have taken to reduce costs and strengthen our operations," said James S Metcalf, Chairman, President and CEO. "United States Gypsum Company and L&W Supply Corporation, our two largest businesses, reduced their reported operating losses in 2011 compared to the prior year, while many of our other key units achieved an operating profit in 2011."

"The success of our SheetRock Brand UltraLight wallboard products in 2011 was one of the highlights of the year," Metcalf continued. "Market acceptance and customer feedback regarding both the 1/2 inch (12.7mm) product and the newer 5/8 inch (15.9mm) products have been outstanding. We foresee significant opportunities to extend the proprietary lightweight technology to other product categories, including our market-leading family of joint treatment products."

Looking ahead Metcalf said, "Our goal is to continue taking the actions necessary to achieve an adjusted operating profit as soon as possible. We will remain focused on strengthening our core businesses, diversifying our earnings and differentiating USG though innovation."

US: Eagle Materials has reported a revenue of US$124m for the third quarter of its 2012 fiscal year which ended on 31 December 2011. This represents a 19% rise compared to the same period of the fiscal 2011 year. However, earnings before interest and taxes (EBIT) fell to US$ 6.89m, a fall of 40% from the same period in 2011.

In its third quarter report Eagle Materials singled out its low-cost operations for performing well during the challenging environment for US construction activity. Gross profit was reported as US$12m, a rise of 59% compared to the same period in 2011. Segment operating earnings increased by 30% reflecting improved sales volumes in the company's wallboard, paperboard and cement businesses and higher wallboard and paperboard net sales prices as compared to the prior year.

For its Gypsum Wallboard and Paperboard sectors Eagle Materials reported third quarter operating earnings of US$5.4m compared to an operating loss of US$0.4m in the same quarter of 2011. Gypsum Wallboard and Paperboard revenues for the third quarter reached US$73.5m, a 24% increase from the same quarter of the 2011 fiscal year. Higher wallboard and paperboard net sales prices combined with improved paperboard sales volumes were the primary drivers of the quarterly earnings and revenues increase.

Saudi Arabia: National Gypsum Company (NGCO) has announced that its net income fell by 44% in the financial year ending 31 December 2011 compared to 2010. The company reported an income of US$14m in 2010 compared to US$7.9m in 2011.

Gross profit in 2011 fell by 37%, to US$11m from US$17m in 2010. Income from operations declined by 42% in 2011 to US$8.2m from US$14m in 2010.

For the fourth quarter of 2011 net income fell by 48% compared to the same quarter in 2010, dropping from US$2.1m to US$1.1m. Net income fell by 3% in the fourth quarter of 2011 compared to the third quarter of 2011. Gross profit for the fourth quarter fell by 34% compared to 2010, falling from US$3.3m to US$2.2m. Income from operations for the fourth quarter fell by 38% compared to 2010, dropping from US$2.6m to US$1.6m

NGCO has attributed the reason for these decreases to net income, gross profit and income from operation to increased competition.

US: Eagle Materials Inc. has reported its fiscal results for the second quarter (ending 30 September 2011) of the 2012 financial year. These show total revenues of USD134.8m and net earnings of USD6m. Revenues increased by 2% from the same period of the prior fiscal year, reflecting improved sales volumes across most of its business lines. Operating earnings were down by 6% due primarily to higher raw material costs in its gypsum wallboard segment.

Eagle Materials' Gypsum Wallboard and Paperboard division's second quarter operating earnings of USD1.5m were down by 71% compared to the same quarter of the 2011 fiscal year. The Gypsum Wallboard and Paperboard sector's revenues for the second fiscal quarter totalled USD72.3m, a 2% increase from the same quarter a year ago. The revenue increase reflects higher wallboard sales volumes and higher paperboard sales prices, offset by lower gypsum wallboard average net sales prices. The average gypsum wallboard net sales price for the quarter was USD92.09/MSF, 4% less than the same quarter of the 2011 fiscal year. The gypsum wallboard sales volume for the quarter of 403MMSF represents a 2% increase.

US: Temple Inland, soon to be owned by International Paper, has released fiscal results for the third quarter of 2011. These show that gypsum wallboard volumes and revenues were down compared to the second quarter of 2011. Revenues were down from USD37m in the second quarter to USD34m and output volumes declined from 299MMSF to 270MMSF. Gross pricing increased by approximately USD2/MMSF between the two quarters.

US: USG has reported a deepening net loss of USD115m for the quarter ending 30 September 2011, compared to a loss of USD100m for the same period in 2010. Revenue rose 4.4% to USD792m, from USD758m in 2010.

A weak economy has been blamed for low levels of demand for the company's products. "Many of our key markets continue to experience recessionary levels of demand that are near record lows," said President and CEO James S. Metcalf.

USG's operating loss for gypsum in North America expanded to USD70m, from USD43m in 2010. It also had a USD17m operating loss for building products, compared to a USD24m loss in 2010. Its Worldwide Ceilings unit had a USD25m operating profit.

US: Eagle Materials, Inc has released its fiscal results for the first quarter (ending 30 June 2011) of the 2012 financial year. Its revenues were USD119.8m and its net earnings were USD3.1m, with earnings per diluted share of USD0.07.

In a statement Eagle said that demand for building materials and construction products remained weak and that it would continue to streamline its operations in response to these lower levels of construction activity. Revenues decreased compared to 2010, primarily due to lower sales volumes across all of Eagle's businesses sections.

Eagle's 'Gypsum Wallboard and Paperboard' section first fiscal quarter operating earnings of USD4.3m were down by 53% compared to the same quarter of 2010. The section's revenues for the first quarter totaled USD70.3m, a 9% decrease from the same quarter of 2010.

The revenue decline reflects lower sales volumes and lower average net sales prices. The average gypsum wallboard net sales price the quarter was USD90.03/MSF, 8% less than the 2010 quarter. Gypsum wallboard sales volumes for the quarter were 412MMSF, representing a 9% decline compared to the same quarter of 2010.

US: USG Corporation (USG) has reported second quarter 2011 net sales of USD761m, an operating loss of USD21m and a net loss of USD70m. For comparison in the second quarter of 2010, the corporation's operating loss was USD25m and its net loss was USD74m.

US Gypsum wallboard shipments totaled 986MMSF, down on the second quarter of 2010, which saw 1070MMSF shipped. The average selling price was also down, from USD114.17/MSF on average to USD111.55/MSF.

"We are continuing to pursue our near-term and long-term strategic priorities during the protracted recession in our domestic markets," said James Metcalf, President and CEO of USG. "By strengthening our core businesses, diversifying the sources of our earnings and aggressively leveraging our innovation leadership to differentiate USG's products from the competition, we are confident that we can successfully navigate this recession and capitalise on a recovery."

The corporation's adjusted operating loss was USD19m in the second quarter of 2011, which compares to an adjusted operating loss of USD18m in the second quarter of 2010. The adjusted operating loss for the second quarter of 2011 excludes USD2m of restructuring and long-lived asset impairment charges, while the adjusted operating loss for the second quarter of 2010 excluded USD7m.

Spain: The Uralita Group, which is engaged in the production of gypsum materials including wallboard (as well as insulation panels) has released its annual report, which shows a 94% slump in its net profit to Euro604,000 from Euro10.1m in 2009.

The group's earnings before interest, tax, depreciation and amortisation (EBITDA) to sales ratio was down from 12.8% to 11.5%. The result continues a four-year record of positive earnings for the group but several of its other indicators were down, including total debt to net tangible assets (from 110.9% to 115.0%), total liabilities to total assets (up by 1.7% to 0.6) and net tangible assets per share (down 3% to Euro1.29).