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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________

Form 8-K
_____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported): December 10, 2018  

Quanex Building Products Corporation
(Exact Name of Registrant as Specified in Charter)

Delaware001-3391326-1561397
(State or Other Jurisdiction of Incorporation)(Commission File Number)(I.R.S. Employer Identification Number)

 

1800 West Loop South, Suite 1500, Houston, Texas 77027
(Address of Principal Executive Offices) (Zip Code)

713-961-4600
(Registrant's telephone number, including area code)


(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 [ ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 [ ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 [ ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 [ ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company [   ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [   ]

 
 

Item 2.02. Results of Operations and Financial Condition.

On December 10, 2018, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

Exhibit 99.1. Press release dated December 10, 2018

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 Quanex Building Products Corporation
   
  
Date: December 10, 2018By: /s/ Brent L. Korb        
  Brent L. Korb
  Senior Vice President - Finance and Chief Financial Officer
  

EdgarFiling

EXHIBIT 99.1

Quanex Building Products Announces Fourth Quarter and Fiscal Year 2018 Results

Underlying Sales Growth of ~6% in Fiscal 2018
Working Capital Management Helped Boost Free Cash Flow by ~73% in Fiscal 2018
Gross Margin Expansion of >200 Basis Points in NA Cabinet Components Segment in 4Q18

HOUSTON, Dec. 10, 2018 (GLOBE NEWSWIRE) -- Quanex Building Products Corporation (NYSE:NX) (“Quanex” or the “Company”) today announced its results for the quarter and fiscal year ended October 31, 2018. 

Bill Griffiths, Chairman, President and Chief Executive Officer, commented, “The free cash flow profile of our business is strong and our disciplined management of working capital was exceptional during the fourth quarter.  As a result, and consistent with our plans to return capital to shareholders, we repurchased approximately $32 million in stock during the fourth quarter while maintaining our leverage ratio of 2.0x.  In addition, we paid down approximately $28 million of bank debt in fiscal 2018.  Looking ahead, we remain committed to maintaining a healthy balance sheet and returning capital to shareholders.

“Market growth and price increases led to underlying growth of approximately 6% in fiscal 2018; however, net sales in August and September were softer than anticipated.  Overall, fourth quarter results were impacted by elevated SG&A expense due to a rise in unforeseen medical costs coupled with higher annual incentive accruals, which are based on a modified free cash flow metric.  At the same time, as a result of operational improvements and better pricing, we achieved gross margin expansion for the second consecutive quarter and for the full fiscal year in our North American Cabinet Components segment.”  

Fourth Quarter and Fiscal Year 2018 Results Summary  

The Company reported the following selected financial results: 

  Three Months Ended October 31, Twelve Months Ended October 31,
   2018  2017  2018  2017
Net Sales $244.1 $233.0 $889.8 $866.6
Net Income $6.5 $10.7 $26.3 $18.7
Diluted EPS $0.19 $0.31 $0.75 $0.54
         
Adjusted Net Income $7.6 $13.1 $22.7 $27.0
Adjusted Diluted EPS $0.22 $0.37 $0.65 $0.77
Adjusted EBITDA $25.2 $33.3 $90.9 $99.0
         
Cash provided by operating activities $56.2 $33.3 $104.6 $79.8
Free Cash Flow $50.8 $25.8 $78.1 $45.2

(See Non-GAAP Terminology Definitions and Disclaimers section, Non-GAAP Financial Measure Disclosure table, Selected Segment Data table and Free Cash Flow Reconciliation table for additional information)

The increases in net sales were mainly driven by market growth combined with price increases largely related to raw material inflation recovery and a favorable foreign exchange impact.  (See Sales Analysis table for additional information)

The decreases in adjusted earnings were mostly due to the negative impact of inflationary pressures and an increase in selling, general and administrative expense.  The increase in selling, general and administrative expense was driven by elevated medical costs and higher annual incentive accruals. Results for the fourth quarter and full fiscal year 2017 included a benefit of $2.0 million and $4.0 million, respectively, related to legal expense reimbursement from one of the Company’s insurance carriers.  (See Non-GAAP Terminology Definitions and Disclaimers section, Non-GAAP Financial Measure Disclosure table and Selected Segment Data table for additional information)          

As previously disclosed, Quanex repurchased 1.9 million shares in a privately negotiated transaction at $16.86 per share during the fourth quarter of 2018 and has approximately $28 million remaining under its current share repurchase program. 

As of October 31, 2018, the Company’s leverage ratio of Net Debt to LTM Adjusted EBITDA was unchanged at 2.0x.  (See Non-GAAP Terminology Definitions and Disclaimers section for additional information) 

Outlook

Bill Griffiths, Chairman, President and Chief Executive Officer, stated, “It is clear that, at a macro level, expectations for growth in the new construction segment are dropping; however, we believe the repair and remodel segment will continue to strengthen, and Quanex is more weighted to this segment than new construction.  Accordingly, we expect revenue growth of 4% to 6% in fiscal 2019.

“It is also clear that inflation is here to stay, and while we are very confident that we can recover this through pricing, realizing significant margin expansion will be challenging.  Therefore, we expect to generate between $97 million and $107 million in Adjusted EBITDA in fiscal 2019.”  (See Forward Looking Statements and Non-GAAP Terminology Definitions and Disclaimers sections for additional information)

Conference Call and Webcast Information

The Company has scheduled a conference call for Tuesday, December 11, 2018, at 11:00 a.m. ET (10:00 a.m. CT).  To participate in the conference call dial (877) 388-2139 for domestic callers and (541) 797-2983 for international callers, in both cases using the conference passcode 6995087, and ask for the Quanex call a few minutes prior to the start time.  A link to the live audio webcast will also be available on the Company’s website at http://www.quanex.com in the Investors section under Presentations & Events.  A telephonic replay of the call will be available approximately two hours after the live broadcast ends and will be accessible through December 18, 2018.  To access the replay dial (855) 859-2056 for domestic callers and (404) 537-3406 for international callers, in both cases referencing conference passcode 6995087. 

About Quanex

Quanex Building Products Corporation is an industry-leading manufacturer of components sold to Original Equipment Manufacturers (OEMs) in the building products industry.  Quanex designs and produces energy-efficient fenestration products in addition to kitchen and bath cabinet components.

For more information contact Scott Zuehlke, Vice President, Investor Relations & Treasurer, at 713-877-5327 or scott.zuehlke@quanex.com.

Non-GAAP Terminology Definitions and Disclaimers

Adjusted Net Income (Loss) (defined as net income further adjusted to exclude purchase price accounting inventory step-ups, transaction costs, gain/loss on the sale of fixed assets, restructuring charges, other net adjustments related to foreign currency transaction gain/loss and effective tax rates reflecting impacts of adjustments on a with and without basis) and Adjusted EPS are non-GAAP financial measures that Quanex believes provide a consistent basis for comparison between periods and more accurately reflects operational performance, as they are not influenced by certain income or expense items not affecting ongoing operations. EBITDA (defined as net income or loss before interest, taxes, depreciation and amortization and other, net) and Adjusted EBITDA (defined as EBITDA further adjusted to exclude purchase price accounting inventory step-ups, transaction costs, gain/loss on the sale of fixed assets, and restructuring charges) are non-GAAP financial measures that the Company uses to measure operational performance and assist with financial decision-making.  When Quanex provides expectations for Adjusted EBITDA on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and corresponding GAAP measures is generally not available without unreasonable effort.  Net Debt is calculated using the sum of current maturities of long-term debt and long-term debt, minus cash and cash equivalents.  The leverage ratio of Net Debt to LTM Adjusted EBITDA is a financial measure that the Company believes is useful to investors and financial analysts in evaluating Quanex’s leverage.  In addition, with certain limited adjustments, this leverage ratio is the basis for a key covenant in the Company’s credit agreement.  Free Cash Flow is a non-GAAP measure calculated using cash provided by operating activities less capital expenditures.   Free Cash Flow is measured before application of certain contractual commitments (including capital lease obligations), and accordingly is not a true measure of Quanex’s residual cash flow available for discretionary expenditures.  The Company believes that the presented non-GAAP measures provide a consistent basis for comparison between periods, and will assist investors in understanding Quanex’s financial performance when comparing results to other investment opportunities.  The presented non-GAAP measures may not be the same as those used by other companies.  The Company does not intend for this information to be considered in isolation or as a substitute for other measures prepared in accordance with U.S. GAAP. 

Forward Looking Statements

Statements that use the words “estimated,” “expect,” “could,” “should,” “believe,” “will,” “might,” or similar words reflecting future expectations or beliefs are forward-looking statements. The forward-looking statements include, but are not limited to, the Company’s future operating results, future financial condition, future uses of cash and other expenditures, expenses and tax rates, expectations relating to Quanex’s industry, and the Company’s future growth, including any guidance discussed in this press release.  The statements and guidance set forth in this release are based on current expectations.  Actual results or events may differ materially from this release.  For a complete discussion of factors that may affect Quanex’s future performance, please refer to the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2017, under the sections entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”.  Any forward-looking statements in this press release are made as of the date hereof, and Quanex undertakes no obligation to update or revise any forward-looking statements to reflect new information or events.  When the Company provides expectations for Adjusted EBITDA on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and corresponding GAAP measures is generally not available without unreasonable effort.  Certain items required for such a reconciliation are outside of Quanex’s control and/or cannot be reasonably predicted or estimated, such as the provision for income taxes.

QUANEX BUILDING PRODUCTS CORPORATION  
CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME  
(In thousands, except per share data)  
(Unaudited)  
          
  Three Months Ended October 31, Twelve Months Ended October 31, 
   2018   2017   2018   2017  
          
Net sales $  244,086  $  232,959  $  889,785  $  866,555  
Cost of sales    187,776     178,325     696,567     672,162  
Selling, general and administrative    31,486     23,142     103,535     97,981  
Restructuring charges    635     1,467     1,486     4,550  
Depreciation and amortization    12,548     13,794     51,822     57,495  
Operating income    11,641     16,231     36,375     34,367  
Interest expense    (3,516)    (2,469)    (11,100)    (9,595) 
Other, net    28     158     178     730  
Income before income taxes    8,153     13,920     25,453     25,502  
Income tax (expense) benefit    (1,661)    (3,188)    875     (6,819) 
Net income $  6,492  $  10,732  $  26,328  $  18,683  
          
Income per common share, basic $  0.19  $  0.31  $  0.76  $  0.55  
Income per common share, diluted $  0.19  $  0.31  $  0.75  $  0.54  
          
Weighted average common shares outstanding:         
Basic    34,508     34,493     34,701     34,230  
Diluted    34,732     35,169     35,025     34,837  
          
Cash dividends per share $  0.08  $  0.04  $  0.20  $  0.16  
          

 

QUANEX BUILDING PRODUCTS CORPORATION 
CONDENSED CONSOLIDATED BALANCE SHEETS 
(In thousands) 
(Unaudited) 
      
  October 31, 2018 October 31, 2017 
ASSETS     
Current assets:     
Cash and cash equivalents $  29,003  $  17,455  
Accounts receivable, net    84,014     79,411  
Inventories, net     69,365     87,529  
Prepaid and other current assets    7,296     7,406  
Total current assets    189,678     191,801  
Property, plant and equipment, net    201,370     211,131  
Goodwill     219,627     222,194  
Intangible assets, net    121,919     139,778  
Other assets    9,255     8,975  
Total assets $  741,849  $  773,879  
      
LIABILITIES AND STOCKHOLDERS' EQUITY     
Current liabilities:     
Accounts payable $  52,389  $  44,150  
Accrued liabilities    45,968     38,871  
Income taxes payable    2,780     2,192  
Current maturities of long-term debt    1,224     21,242  
Total current liabilities    102,361     106,455  
Long-term debt    209,332     218,184  
Deferred pension and postretirement benefits    4,218     4,433  
Deferred income taxes    17,215     21,960  
Liabilities for uncertain tax positions    606     591  
Other liabilities    13,965     15,409  
Total liabilities    347,697     367,032  
Stockholders’ equity:     
Common stock    374     375  
Additional paid-in-capital    254,678     255,719  
Retained earnings    242,834     225,704  
Accumulated other comprehensive loss    (30,705)    (25,076) 
Treasury stock at cost    (73,029)    (49,875) 
Total stockholders’ equity    394,152     406,847  
Total liabilities and stockholders' equity $  741,849  $  773,879  
      

 

QUANEX BUILDING PRODUCTS CORPORATION  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW  
(In thousands)  
(Unaudited)  
     
 Twelve Months Ended October 31, 
  2018  2017 (1) 
Operating activities:    
Net income$  26,328  $  18,683  
Adjustments to reconcile net income to cash provided by operating activities:    
Depreciation and amortization   51,822     57,495  
Stock-based compensation   1,874     5,189  
Deferred income tax   (5,631)    (112) 
(Gain) loss on the disposition of capital assets   (142)    1,528  
Charge for deferred loan costs   1,064     -  
Other, net   135     1,741  
Changes in assets and liabilities:    
(Increase) decrease in accounts receivable   (5,550)    5,378  
Decrease (increase) in inventory   17,530     (3,240) 
Decrease in other current assets   217     186  
Increase (decrease) in accounts payable   8,325     (4,893) 
Increase (decrease) in accrued liabilities   6,892     (7,521) 
Increase in income taxes payable   676     4,670  
Increase (decrease) in deferred pension and postretirement benefits   2,038     (271) 
(Decrease) Increase in other long-term liabilities   (523)    1,382  
Other, net   (444)    (437) 
Cash provided by operating activities   104,611     79,778  
Investing activities:    
Acquisitions, net of cash acquired   -     (8,497) 
Capital expenditures   (26,484)    (34,564) 
Proceeds from disposition of capital assets   432     1,937  
Cash used for investing activities   (26,052)    (41,124) 
Financing activities:    
Borrowings under credit facilities   268,500     53,500  
Repayments of credit facility borrowings   (296,250)    (98,875) 
Debt issuance costs   (1,001)    -   
Repayments of other long-term debt   (1,798)    (2,722) 
Common stock dividends paid   (7,020)    (5,516) 
Issuance of common stock   4,746     7,953  
Payroll tax paid to settle shares forfeited upon vesting of stock   (960)    (976) 
Purchase of treasury stock   (32,034)    -  
Cash used for financing activities   (65,817)    (46,636) 
Effect of exchange rate changes on cash and cash equivalents   (1,194)    (89) 
Decrease in cash and cash equivalents   11,548     (8,071) 
Cash and cash equivalents at beginning of period   17,455     25,526  
Cash and cash equivalents at end of period$  29,003  $  17,455  
     
(1) Updated to reflect adoption of ASU 2016-09.    
     

 

QUANEX BUILDING PRODUCTS CORPORATION  
FREE CASH FLOW RECONCILIATION 
(In thousands)  
(Unaudited)  
  
The following table reconciles the Company's calculation of Free Cash Flow, a non-GAAP measure, to its most directly comparable GAAP measure.  The Company defines Free Cash Flow as cash provided by operating activities less capital expenditures.
 
          
  Three Months Ended October 31, Twelve Months Ended October 31, 
   2018   2017   2018   2017  
Cash provided by operating activities $56,158  $33,313     104,611     79,778  
Capital expenditures  (5,386)  (7,466)  (26,484)  (34,564) 
Free Cash Flow $50,772  $25,847  $78,127  $45,214  

 

QUANEX BUILDING PRODUCTS CORPORATION  
NON-GAAP FINANCIAL MEASURE DISCLOSURE  
(In thousands, except per share data)  
(Unaudited)  
                      
                      
 Reconciliation of Adjusted Net Income and Adjusted EPS Three Months Ended
October 31, 2018
  Three Months Ended
October 31, 2017
  Twelve Months Ended
October 31, 2018
  Twelve Months Ended
October 31, 2017
  
  Net
Income		 Diluted
EPS		  Net
Income		 Diluted
EPS		  Net
Income		 Diluted
EPS		  Net
Income		 Diluted
EPS		  
Net income as reported $  6,492  $  0.19   $  10,732  $  0.31   $  26,328  $  0.75   $  18,683  $  0.54   
Reconciling items from below    1,085     0.03      2,337     0.06      (3,642)    (0.11)     8,303     0.23   
Adjusted net income and adjusted EPS $  7,577  $  0.22   $  13,069  $  0.37   $  22,686  $  0.65   $  26,986  $  0.77   
                      
Reconciliation of Adjusted EBITDA Three Months Ended
October 31, 2018		  Three Months Ended
October 31, 2017		  Twelve Months Ended
October 31, 2018		  Twelve Months Ended
October 31, 2017		  
                      
  Reconciliation    Reconciliation    Reconciliation    Reconciliation    
Net income as reported $  6,492     $  10,732     $  26,328     $  18,683     
Income tax expense (benefit)    1,661        3,188        (875)       6,819     
Other, net    (28)       (158)       (178)       (730)    
Interest expense    3,516        2,469        11,100        9,595     
Depreciation and amortization    12,548        13,794        51,822        57,495     
EBITDA    24,189        30,025        88,197        91,862     
Reconciling items from below    1,043        3,263        2,693        7,156     
Adjusted EBITDA $  25,232     $  33,288     $  90,890     $  99,018     
                      
Reconciling Items Three Months Ended
October 31, 2018		  Three Months Ended
October 31, 2017		  Twelve Months Ended
October 31, 2018		  Twelve Months Ended
October 31, 2017		  
  Income
Statement		 Reconciling
Items		  Income
Statement		 Reconciling
Items		  Income
Statement		 Reconciling
Items		  Income
Statement		 Reconciling
Items		  
Net sales $  244,086  $  -    $  232,959  $  -    $  889,785  $  -    $  866,555  $  -    
Cost of sales    187,776     (300) (1 )    178,325     -       696,567     (300) (1 )    672,162     (104) (2 ) 
Selling, general and administrative    31,486     (108) (3 )    23,142     (1,796) (3 )    103,535     (907) (3 )    97,981     (2,502) (3 ) 
Restructuring charges    635     (635) (4 )    1,467     (1,467) (4 )    1,486     (1,486) (4 )    4,550     (4,550) (4 ) 
EBITDA    24,189     1,043      30,025     3,263      88,197     2,693      91,862     7,156   
Depreciation and amortization    12,548     -       13,794     (731) (5 )    51,822     (852) (6 )    57,495     (6,233) (5 ) 
Operating income    11,641     1,043      16,231     3,994      36,375     3,545      34,367     13,389   
Interest expense    (3,516)    1,064      (2,469)    -       (11,100)    1,064      (9,595)    -    
Other, net    28     (14) (7 )    158     (111) (7 )    178     (102) (7 )    730     (625) (7 ) 
Income before income taxes    8,153     2,093      13,920     3,883      25,453     4,507      25,502     12,764   
Income tax (expense) benefit    (1,661)    (1,008) (8 )    (3,188)    (1,546) (8 )    875     (8,149) (8 )    (6,819)    (4,461) (8 ) 
Net income (loss) $  6,492  $  1,085   $  10,732  $  2,337   $  26,328  $  (3,642)  $  18,683  $  8,303   
                      
Diluted earnings per share $  0.19     $  0.31     $  0.75     $  0.54     
                      
(1) LIFO inventory reserve adjustment.  
(2) Relates to purchase price accounting inventory step-up impact from HL Plastics acquisition.  
(3) Transaction and advisory fees and in 2017, the loss on the sale of a plant in 4Q17.         
(4) Restructuring charges relate to the closure of several manufacturing plant facilities.  
(5) Accelerated depreciation and amortization for restructured PP&E and intangible assets.   
(6) Accelerated depreciation for a plant re-layout in the North American Cabinet Components segment.   
(7) Foreign currency transaction gains.   
(8) Impact on a with and without basis.  Twelve months ended October 31, 2018 includes $6.5 million adjustment related to the Tax Cuts and Jobs Act.   
                      

 

QUANEX BUILDING PRODUCTS CORPORATION  
SELECTED SEGMENT DATA  
(In thousands)  
(Unaudited)  
            
This table provides operating income (loss), EBITDA, and Adjusted EBITDA by reportable segment.  Non-operating expense and income tax expense are not allocated to the reportable segments.  
  NA Engineered
Components		 EU Engineered
Components		 NA Cabinet
Components		 Unallocated
Corp & Other		 Total 
Three months ended October 31, 2018           
Net sales $  135,086  $  44,491  $  66,108  $  (1,599) $  244,086  
Cost of sales    102,129     31,634     54,996     (983)    187,776  
Selling, general and administrative    14,755     5,971     5,605     5,155     31,486  
Restructuring charges    629     -      6     -      635  
Depreciation and amortization    6,687     2,278     3,444     139     12,548  
Operating income (loss)    10,886     4,608     2,057     (5,910)    11,641  
Depreciation and amortization    6,687     2,278     3,444     139     12,548  
EBITDA    17,573     6,886     5,501     (5,771)    24,189  
LIFO inventory reserve adjustment    -      -      -      300     300  
Transaction and advisory fees    -      -      -      108     108  
Restructuring charges    629     -      6     -      635  
Adjusted EBITDA  $  18,202  $  6,886  $  5,507  $  (5,363) $  25,232  
Adjusted EBITDA Margin %  13.5%  15.5%  8.3%    10.3% 
            
Three months ended October 31, 2017           
Net sales $  131,380  $  41,830  $  61,110  $  (1,361) $  232,959  
Cost of sales    97,523     29,572     52,214     (984)    178,325  
Selling, general and administrative    14,076     5,449     3,887     (270)    23,142  
Restructuring charges    1,357     -      110     -      1,467  
Depreciation and amortization    7,932     2,080     3,650     132     13,794  
Operating income (loss)    10,492     4,729     1,249     (239)    16,231  
Depreciation and amortization    7,932     2,080     3,650     132     13,794  
EBITDA    18,424     6,809     4,899     (107)    30,025  
Transaction and advisory fees    -      -      -      169     169  
Loss on sale of plant    1,627     -      -      -      1,627  
Restructuring charges    1,357     -      110     -      1,467  
Adjusted EBITDA  $  21,408  $  6,809  $  5,009  $  62  $  33,288  
Adjusted EBITDA Margin %  16.3%  16.3%  8.2%    14.3% 
            
Twelve months ended October 31, 2018           
Net sales $  485,366  $  159,973  $  249,813  $  (5,367) $  889,785  
Cost of sales    371,285     114,894     214,062     (3,674)    696,567  
Selling, general and administrative    53,992     22,770     17,973     8,800     103,535  
Restructuring charges    1,357     -      129     -      1,486  
Depreciation and amortization    27,248     9,607     14,401     566     51,822  
Operating income (loss)    31,484     12,702     3,248     (11,059)    36,375  
Depreciation and amortization    27,248     9,607     14,401     566     51,822  
EBITDA    58,732     22,309     17,649     (10,493)    88,197  
LIFO inventory reserve adjustment    -      -      -      300     300  
Transaction and advisory fees    -      -      -      907     907  
Restructuring charges    1,357     -      129     -      1,486  
Adjusted EBITDA  $  60,089  $  22,309  $  17,778  $  (9,286) $  90,890  
Adjusted EBITDA Margin %  12.4%  13.9%  7.1%    10.2% 
            
Twelve months ended October 31, 2017           
Net sales $  474,878  $  147,963  $  248,808  $  (5,094) $  866,555  
Cost of sales    357,806     104,876     213,257     (3,777)    672,162  
Selling, general and administrative    52,889     20,581     16,626     7,885     97,981  
Restructuring charges    3,564     -      986     -      4,550  
Depreciation and amortization    34,308     8,833     13,811     543     57,495  
Operating income (loss)    26,311     13,673     4,128     (9,745)    34,367  
Depreciation and amortization    34,308     8,833     13,811     543     57,495  
EBITDA    60,619     22,506     17,939     (9,202)    91,862  
Transaction related costs    -      -      -      497     497  
Mexico restructuring, loss on disposal of fixed assets    -      -      190     -      190  
One-time employee benefit adjustment    -      -      188     -      188  
PPA-Inventory Step-up    -      104     -      -      104  
Loss on sale of plant    1,627     -      -      -      1,627  
Restructuring charges    3,564     -      986     -      4,550  
Adjusted EBITDA  $  65,810  $  22,610  $  19,303  $  (8,705) $  99,018  
Adjusted EBITDA Margin %  13.9%  15.3%  7.8%    11.4% 
            

 

QUANEX BUILDING PRODUCTS CORPORATION  
SALES ANALYSIS  
(In thousands)  
(Unaudited)  
          
   Three Months Ended  Twelve Months Ended 
  October 31, 2018 October 31, 2017 October 31, 2018 October 31, 2017 
          
NA Engineered Components:        
 United States - fenestration (1)$  114,299  $  110,659  $  412,000  $  399,694  
 International - fenestration   11,552     9,334     39,309     34,279  
 United States - non-fenestration (2)   4,693     5,673     18,211     25,263  
 International - non-fenestration   4,542     5,714     15,846     15,642  
  $  135,086  $  131,380  $  485,366  $  474,878  
EU Engineered Components  (3):        
 United States - fenestration$  -  $  -  $  -  $  303  
 International - fenestration (4)   37,816     37,015     135,415     129,140  
 International - non-fenestration   6,675     4,815     24,558     18,520  
  $  44,491  $  41,830  $  159,973  $  147,963  
NA Cabinet Components:        
 United States - fenestration$  4,096  $  5,597  $  14,596  $  17,083  
 United States - non-fenestration (5)   61,442     54,977     232,990     229,550  
 International - non-fenestration   570     536     2,227     2,175  
  $  66,108  $  61,110  $  249,813  $  248,808  
Unallocated Corporate & Other:        
 Eliminations$  (1,599) $  (1,361) $  (5,367) $  (5,094) 
  $  (1,599) $  (1,361) $  (5,367) $  (5,094) 
          
Net Sales$  244,086  $  232,959  $  889,785  $  866,555  
          
(1) Reflects the loss of revenue associated with eliminated products of $1.0 million and $12.7 million for the three and twelve months ended October 31, 2018. 
(2) Reflects the loss of revenue associated with eliminated products of $1.9 million and $9.4 million for the three and twelve months ended October 31, 2018. 
(3) Reflects a loss of $0.6 million and gain of $8.7 million in revenue associated with foreign currency exchange rate impacts for the three and twelve months ended October 31, 2018. 
(4) Reflects loss of revenue associated with eliminated products of $0.4 million and $7.1 million for the three and twelve months ended October 31, 2018. 
(5) Reflects the loss of revenue associated with eliminated products of $3.9 million for the twelve months ended October 31, 2018.