Masco Corporation (MAS) showed a decline in loss to 2 cents per share in the first quarter of 2010 from 24 cents per share in the prior-year quarter. However, the company is lagging behind the Zacks Consensus Estimate of breakeven results for the quarter.
Operating profit increased to $78 million in contrast to a loss of $2 million in the first quarter of 2009. Sales in the quarter increased marginally by 3% to $1.9 billion. Sales in North America were flat while international sales rose 16% compared with the year-ago level.
Sales in the Cabinets and Related Products segment increased only 2% to $403 million; Plumbing Products rose 14% to $663 million; Installation and Other Services declined 14% to $273 million; Decorative Architectural Products increased marginally by 1% to $389 million; and Other Specialty Products rose 8% to $124 million.
Masco’s results were driven by a rise in sales volume of plumbing products and windows, favorable product mix of paints and stains, and improvement in margin. This apart, business rationalization and other cost saving initiatives also helped the company improve its results. Improvements however, were partially offset by lower sales volume of installation and other services and lower selling prices for certain products.
Masco had a cash balance of $1.4 billion as of March 31, 2010. The company’s total debt amounted to $4.2 billion as of the above period. The debt-to-capitalization ratio stood at 61%.
Masco is optimistic about its business condition in 2010. The company expects housing starts to increase to a range of 600,000 to 700,000 units in the year from 554,000 units in 2009.
Masco Corporation is headquartered in Taylor, Michigan. It manufactures, sells and installs home improvement and building products. Approximately 78% of the company’s sales are generated by operations in North America. International operations are located principally in Belgium, China, Denmark, Germany, the Netherlands and the U.K.
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