NYSE$TREX

Trex Co Inc · Q1 2020 earnings

Q1 2020 earnings · · Investor relations

Briefing

Trex reported robust demand across decking product lines, significant margin expansion driven by production improvements and expense control.

Trex Company reported a 12% increase in consolidated net sales, reaching $200 million. The company's gross margin expanded by 620 basis points to 44.8%, and earnings per share increased by 35% to $0.73.

  • Consolidated net sales increased 12% to $200 million.
  • Consolidated gross margin increased to 44.8%, up 620 basis points.
  • EBITDA margin increased to 29.4%, up 570 basis points.
  • Consolidated earnings per share increased to $0.73, up 35%.

Headline financials

Total Revenue

$200M

Previous: $180M+11.6%
EPS (adj)

$0.37

Previous: $0.27+37.0%
Gross Margin

44.8%

No prior period
SG&A Expense

$35M

No prior period
Capital Expenditures

-$22.7M

Previous: -$8.65M-162.9%
Free Cash Flow

$19.7M

Previous: $22.9M-14.1%
Net Income

$42.4M

Previous: $31.6M+34.4%
Operating Income

$55.1M

Previous: $39.2M+40.7%
Gross Profit

$89.7M

Previous: $69.4M+29.3%
Cash & Equivalents

$5.34M

Previous: $7.91M-32.5%
Total Assets

$631M

Previous: $536M+17.8%
Stock-Based Comp

$2.78M

Previous: $2.79M-0.6%

Revenue & EPS history

Trex · Revenue · Quarterly

$200M

Q1 2020+11.6%vs Q1 2019
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Forward guidance

Trex projects second quarter sales of $180 million to $190 million.

Tailwinds

  • Inventories of materials sourced from diversified geographies and vendors.
  • Production and sales volumes for April were in-line with internal plans.
  • Rebound in web traffic and retailer searches as states begin easing restrictions.
  • Positive consumer sentiment for the outdoor living products market.
  • Increase in do-it-yourself home improvement spending.

Headwinds

  • Potential economic impacts of the COVID-19 crisis.
  • Rescinded guidance metrics previously provided for full-year 2020 until second-half visibility improves.
  • Experiencing lower demand from areas where construction has been deemed non-essential.
  • Channel partners are closed in some areas.
  • Web traffic and purchase indicators declined towards the end of the first quarter and that continued into the beginning of the second quarter.

Historical earnings impact

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

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2020

Historical avgQ1 2020

+1.1%

Avg return

Earnings day

+2.1%

Avg return

5 days after

+2.4%

Avg return

30 days after

51%

33 / 65 earnings

Positive

+26.8%

Q3 2013

Best reaction

-31.1%

Q3 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.9%-2.2%-0.7%
Q4 2025+0.7%-1.9%-14.3%
Q3 2025-31.1%-31.5%-26.7%
Q1 2025-1.0%+3.6%-2.8%
Q4 2024+1.2%+5.1%-5.8%
Q3 2024+9.8%+10.0%+15.7%
Q2 2024-20.4%-19.5%-19.4%
Q1 2024-3.8%-2.5%-11.7%
Q4 2023-0.7%+0.9%+5.8%
Q3 2023+3.6%+15.5%+29.4%
Q2 2023+9.7%+4.8%+2.9%
Q1 2023+10.2%+2.6%+5.4%
Q4 2022+2.0%-4.1%+5.9%
Q3 2022-10.6%-14.3%-7.0%
Q2 2022-16.0%-8.7%-27.2%
Q1 2022+5.7%+13.2%+16.5%
Q4 2021-8.0%-17.4%-22.0%
Q3 2021+16.2%+13.6%+23.0%
Q2 2021+0.3%+8.4%+14.4%
Q1 2021-2.5%-3.8%-10.1%
Q4 2020-11.2%-10.7%-14.7%
Q3 2020+2.0%+14.5%+6.2%
Q2 2020-0.3%-0.2%+9.3%
Q1 2020+18.8%+25.2%+27.1%
Q4 2019-2.4%-10.0%-23.4%
Q3 2019-6.6%-0.7%-2.8%
Q2 2019+14.3%+12.5%+18.4%
Q1 2019-8.9%-11.0%-19.2%
Q4 2018-1.2%+0.7%-9.7%
Q3 2018-0.5%+7.6%+5.0%
Q2 2018+20.2%+21.4%+30.1%
Q1 2018+12.6%+9.1%+19.4%
Q4 2017-4.9%+0.2%-3.1%
Q3 2017+22.8%+17.1%+31.1%
Q2 2017+3.4%+6.5%+3.1%
Q1 2017-7.5%-10.8%-7.9%
Q4 2016-5.7%-5.0%-0.4%
Q3 2016+11.0%+22.3%+27.6%
Q2 2016+17.4%+22.2%+27.7%
Q1 2016-6.5%
Q4 2015+16.9%
Q3 2015-2.9%
Q2 2015-10.6%
Q1 2015+0.3%
Q4 2014+4.1%
Q3 2014+7.7%
Q2 2014+18.5%
Q1 2014-10.9%
Q4 2013+10.8%
Q3 2013+26.8%
Q2 2013-11.7%
Q1 2013+8.4%
Q4 2012+7.6%
Q3 2012+12.4%
Q2 2012-5.9%
Q1 2011-6.9%
Q1 2012-0.5%
Q4 2009+3.6%
Q4 2011+3.6%
Q3 2011+7.5%
Q3 2010+7.5%
Q2 2011-13.5%
Q4 2010-13.5%
Q2 2010-13.5%
Q1 2010-2.5%

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