NYSE$NX

Quanex Building Products Corporation · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Announced second quarter 2020 results with strong balance sheet and liquidity, and margin expansion in NA Fenestration segment.

Quanex Building Products announced its Q2 2020 results, noting that the first two months of the quarter were solid, but April was challenging due to the COVID-19 pandemic. Despite volume decline in April, the company realized Adjusted EBITDA margin expansion in the North American Fenestration segment and on a consolidated basis. All plants are operational, furloughed employees have started to be recalled, and volume in May was not as soft as anticipated.

  • Realized Adjusted EBITDA margin expansion in North American Fenestration segment and on a consolidated basis.
  • Liquidity was $189.3 million as of April 30, 2020, consisting of $80.2 million in cash on hand plus availability under its Senior Secured Revolving Credit Facility.
  • All plants are operational and the company has started to recall furloughed employees.
  • The company repurchased 149,937 shares of common stock for approximately $2.1 million at an average price of $13.70 per share during the three months ended April 30, 2020.

Headline financials

Total Revenue

$187M

Previous: $218M-14.1%
EPS (adj)

$0.19

Previous: $0.19+0.0%
Capital Expenditures

-$7M

Previous: -$6.75M-3.7%
Free Cash Flow

-$4.53M

Previous: $1.88M-341.5%
Net Income

$5.5M

Previous: -$24M+122.9%
Operating Income

$8.89M

Previous: -$19.4M+145.9%
Gross Profit

$37.7M

Previous: $46.8M-19.4%
Cash & Equivalents

$80.3M

Previous: $20.3M+296.1%
Total Assets

$713M

Previous: $707M+0.8%
Stock-Based Comp

$325K

Previous: $819K-60.3%

Revenue & EPS history

Quanex · Revenue · Quarterly

$187M

Q2 2020-14.1%vs Q2 2019
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Forward guidance

Management is optimistic about the recovery ahead, but understands challenges will persist in the near-term.

Tailwinds

  • Variable cost structure enables the company to flex down as volume dictates to protect margins.
  • All of our plants are operational
  • The company has started to recall furloughed employees
  • Balance sheet and liquidity remain very strong
  • Volume in May was not as soft as anticipated

Headwinds

  • Uncertainty related to the COVID-19 pandemic
  • Volume started to decline in all of Quanex’s manufacturing facilities in late March
  • Two manufacturing facilities in the UK were shut down completely on March 25, 2020 in compliance with government orders
  • Challenges will persist in the near-term
  • Withdrew guidance for 2020

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+1.1%

Avg return

Earnings day

+0.5%

Avg return

5 days after

-0.7%

Avg return

30 days after

55%

37 / 67 earnings

Positive

+23.8%

Q2 2023

Best reaction

-17.7%

Q1 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026-13.6%-10.3%
Q1 2026-7.9%-5.9%-7.1%
Q4 2025+6.5%+5.2%+16.2%
Q3 2025-12.8%-27.3%-29.6%
Q2 2025+0.0%-5.6%-3.1%
Q1 2025-9.2%-3.4%-14.6%
Q4 2024-3.8%-9.9%-25.7%
Q3 2024+19.9%+3.6%+8.0%
Q2 2024+2.8%-4.1%-13.4%
Q1 2024-2.3%+0.6%+10.4%
Q4 2023-7.0%-6.1%-7.6%
Q3 2023+9.0%+5.3%+4.2%
Q2 2023+23.8%+24.3%+27.8%
Q1 2023-17.7%-20.6%-20.7%
Q4 2022-2.1%-2.6%+1.1%
Q3 2022-4.5%-5.2%-18.6%
Q2 2022+13.1%+20.8%+15.4%
Q1 2022+0.9%-2.1%-6.5%
Q4 2021+3.4%+4.0%+6.7%
Q3 2021-6.5%-6.2%-7.0%
Q2 2021+3.5%+5.3%-7.5%
Q1 2021+1.5%+8.8%+9.8%
Q4 2020+1.1%+2.3%+15.6%
Q3 2020+6.4%+6.6%+11.1%
Q2 2020+5.4%+2.3%-4.3%
Q1 2020-0.2%-12.2%-47.0%
Q4 2019+2.9%+1.5%-10.0%
Q3 2019+6.7%+7.3%+9.4%
Q2 2019+6.4%+5.2%+17.4%
Q1 2019-5.2%-14.6%-5.6%
Q4 2018-12.7%-5.7%+9.3%
Q3 2018+19.3%+18.1%+3.9%
Q2 2018+14.3%+12.8%+7.7%
Q1 2018+8.8%+5.3%+5.6%
Q4 2017+6.7%+15.1%+7.2%
Q3 2017-0.3%-0.8%+17.6%
Q2 2017+5.9%+8.7%+7.7%
Q1 2017+1.0%+1.8%+1.3%
Q4 2016+2.0%+5.7%+2.2%
Q3 2016-6.1%-9.2%-9.1%
Q2 2016+1.7%+0.9%-4.4%
Q1 2016-9.6%
Q4 2015+9.1%
Q3 2015+11.7%
Q2 2015+8.6%
Q1 2015+0.6%
Q4 2014-9.2%
Q3 2014+0.0%
Q2 2014+3.9%
Q1 2014-0.3%
Q4 2013+6.8%
Q3 2013+7.4%
Q2 2013-5.5%
Q1 2013-10.6%
Q1 2010+6.0%
Q4 2012-8.6%
Q3 2012-2.7%
Q2 2012-1.6%
Q1 2012-5.8%
Q4 2009+13.4%
Q4 2011+13.4%
Q3 2010-5.2%
Q3 2011-5.2%
Q2 2011-5.7%
Q2 2010+1.5%
Q4 2010+1.5%
Q1 2011+1.5%

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