Form 10-Q
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
|
|
|
þ |
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 |
For the quarterly period ended June 27, 2009
OR
|
|
|
o |
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number 0-22684
UNIVERSAL FOREST PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
|
|
|
Michigan
|
|
38-1465835 |
|
|
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification Number) |
|
|
|
2801 East Beltline NE, Grand Rapids, Michigan
|
|
49525 |
|
|
|
(Address of principal executive offices)
|
|
(Zip Code) |
Registrants telephone number, including area code (616) 364-6161
NONE
(Former name or former address, if changed since last report.)
Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to
submit and post such files). Yes
o No o
Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
|
|
|
|
|
|
|
Large Accelerated Filer þ
|
|
Accelerated Filer o
|
|
Non-Accelerated Filer o
|
|
Smaller reporting company o |
Indicate by checkmark whether the registrant is a shell company (as defined by Rule 12b-2 of the
Exchange Act). Yes o No þ
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of
the latest practicable date:
|
|
|
Class
|
|
Outstanding as of June 27, 2009 |
|
|
|
Common stock, no par value
|
|
19,308,699 |
UNIVERSAL FOREST PRODUCTS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 27, |
|
|
December 27, |
|
|
June 28, |
|
(in thousands, except share data) |
|
2009 |
|
|
2008 |
|
|
2008 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
32,633 |
|
|
$ |
13,337 |
|
|
$ |
32,483 |
|
Accounts receivable, net |
|
|
197,901 |
|
|
|
138,043 |
|
|
|
227,963 |
|
Inventories: |
|
|
|
|
|
|
|
|
|
|
|
|
Raw materials |
|
|
95,288 |
|
|
|
109,942 |
|
|
|
122,262 |
|
Finished goods |
|
|
70,202 |
|
|
|
83,554 |
|
|
|
100,675 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
165,490 |
|
|
|
193,496 |
|
|
|
222,937 |
|
Assets held for sale |
|
|
3,057 |
|
|
|
8,296 |
|
|
|
10,334 |
|
Refundable income taxes |
|
|
|
|
|
|
6,283 |
|
|
|
489 |
|
Other current assets |
|
|
19,728 |
|
|
|
21,453 |
|
|
|
34,339 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT ASSETS |
|
|
418,809 |
|
|
|
380,908 |
|
|
|
528,545 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS |
|
|
3,456 |
|
|
|
5,927 |
|
|
|
7,657 |
|
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS |
|
|
156,936 |
|
|
|
159,263 |
|
|
|
158,287 |
|
OTHER INTANGIBLE ASSETS, net |
|
|
20,767 |
|
|
|
22,751 |
|
|
|
28,377 |
|
PROPERTY, PLANT AND EQUIPMENT: |
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment |
|
|
506,519 |
|
|
|
505,177 |
|
|
|
514,347 |
|
Accumulated depreciation and amortization |
|
|
(271,010 |
) |
|
|
(258,007 |
) |
|
|
(250,712 |
) |
|
|
|
|
|
|
|
|
|
|
PROPERTY, PLANT AND
EQUIPMENT, NET |
|
|
235,509 |
|
|
|
247,170 |
|
|
|
263,635 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
835,477 |
|
|
$ |
816,019 |
|
|
$ |
986,501 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
98,805 |
|
|
$ |
63,184 |
|
|
$ |
122,345 |
|
Accrued liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
50,580 |
|
|
|
49,306 |
|
|
|
53,327 |
|
Other |
|
|
34,879 |
|
|
|
22,620 |
|
|
|
35,766 |
|
Current portion of long-term debt and capital lease
obligations |
|
|
396 |
|
|
|
15,490 |
|
|
|
945 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT
LIABILITIES |
|
|
184,660 |
|
|
|
150,600 |
|
|
|
212,383 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, less current portion |
|
|
55,108 |
|
|
|
85,684 |
|
|
|
177,063 |
|
DEFERRED INCOME TAXES |
|
|
17,746 |
|
|
|
17,056 |
|
|
|
24,491 |
|
OTHER LIABILITIES |
|
|
14,766 |
|
|
|
14,453 |
|
|
|
17,746 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
272,280 |
|
|
|
267,793 |
|
|
|
431,683 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY: |
|
|
|
|
|
|
|
|
|
|
|
|
Controlling interest shareholders equity: |
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, no par value; shares
authorized 1,000,000;
issued and
outstanding, none |
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, no par value; shares
authorized 40,000,000;
issued and
outstanding,
19,308,699, 19,088,880 and 18,989,644 |
|
$ |
19,309 |
|
|
$ |
19,089 |
|
|
$ |
18,990 |
|
Additional paid-in capital |
|
|
130,405 |
|
|
|
128,830 |
|
|
|
125,225 |
|
Retained earnings |
|
|
407,035 |
|
|
|
393,312 |
|
|
|
397,201 |
|
Accumulated other comprehensive
earnings |
|
|
2,615 |
|
|
|
2,353 |
|
|
|
4,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
559,364 |
|
|
|
543,584 |
|
|
|
546,069 |
|
Employee stock notes receivable |
|
|
(1,797 |
) |
|
|
(1,701 |
) |
|
|
(1,775 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
557,567 |
|
|
|
541,883 |
|
|
|
544,294 |
|
Noncontrolling interest |
|
|
5,630 |
|
|
|
6,343 |
|
|
|
10,524 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY |
|
|
563,197 |
|
|
|
548,226 |
|
|
|
554,818 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND EQUITY |
|
$ |
835,477 |
|
|
$ |
816,019 |
|
|
$ |
986,501 |
|
|
|
|
|
|
|
|
|
|
|
See notes to unaudited consolidated condensed financial statements.
3
UNIVERSAL FOREST PRODUCTS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 27, |
|
|
June 28, |
|
|
June 27, |
|
|
June 28, |
|
(in thousands, except per share data) |
|
2009 |
|
|
2008 |
|
|
2009 |
|
|
2008 |
|
|
NET SALES |
|
$ |
514,945 |
|
|
$ |
708,485 |
|
|
$ |
876,667 |
|
|
$ |
1,197,997 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF GOODS SOLD |
|
|
432,460 |
|
|
|
623,607 |
|
|
|
747,361 |
|
|
|
1,058,299 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
82,485 |
|
|
|
84,878 |
|
|
|
129,306 |
|
|
|
139,698 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES |
|
|
56,020 |
|
|
|
61,712 |
|
|
|
105,112 |
|
|
|
120,256 |
|
NET (GAIN) LOSS ON DISPOSITION OF ASSETS AND
OTHER IMPAIRMENT AND EXIT
CHARGES |
|
|
(716 |
) |
|
|
408 |
|
|
|
(1,852 |
) |
|
|
1,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS FROM OPERATIONS |
|
|
27,181 |
|
|
|
22,758 |
|
|
|
26,046 |
|
|
|
18,227 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST EXPENSE |
|
|
1,429 |
|
|
|
3,290 |
|
|
|
2,503 |
|
|
|
6,884 |
|
INTEREST INCOME |
|
|
(96 |
) |
|
|
(179 |
) |
|
|
(179 |
) |
|
|
(552 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,333 |
|
|
|
3,111 |
|
|
|
2,324 |
|
|
|
6,332 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS BEFORE INCOME TAXES |
|
|
25,848 |
|
|
|
19,647 |
|
|
|
23,722 |
|
|
|
11,895 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAXES |
|
|
9,393 |
|
|
|
7,470 |
|
|
|
8,430 |
|
|
|
4,120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET EARNINGS |
|
|
16,455 |
|
|
|
12,177 |
|
|
|
15,292 |
|
|
|
7,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LESS NET EARNINGS ATTRIBUTABLE TO
NONCONTROLLING INTEREST |
|
|
(367 |
) |
|
|
(514 |
) |
|
|
(411 |
) |
|
|
(688 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET EARNINGS ATTRIBUTABLE TO
CONTROLLING INTEREST |
|
$ |
16,088 |
|
|
$ |
11,663 |
|
|
$ |
14,881 |
|
|
$ |
7,087 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE BASIC |
|
$ |
0.84 |
|
|
$ |
0.61 |
|
|
$ |
0.77 |
|
|
$ |
0.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE DILUTED |
|
$ |
0.83 |
|
|
$ |
0.61 |
|
|
$ |
0.77 |
|
|
$ |
0.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
19,241 |
|
|
|
19,048 |
|
|
|
19,213 |
|
|
|
19,022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
WITH COMMON STOCK EQUIVALENTS |
|
|
19,459 |
|
|
|
19,267 |
|
|
|
19,370 |
|
|
|
19,224 |
|
See notes to unaudited consolidated condensed financial statements.
4
UNIVERSAL FOREST PRODUCTS, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Controlling Interest Shareholders Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other |
|
|
Employees |
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Paid- |
|
|
Retained |
|
|
Comprehensive |
|
|
Stock Notes |
|
|
Noncontrolling |
|
|
|
|
(in thousands, except share and per share data) |
|
Common Stock |
|
|
In Capital |
|
|
Earnings |
|
|
Earnings |
|
|
Receivable |
|
|
Interest |
|
|
Total |
|
Balance at December 29, 2007 |
|
$ |
18,908 |
|
|
$ |
123,368 |
|
|
$ |
391,253 |
|
|
$ |
4,704 |
|
|
$ |
(1,565 |
) |
|
$ |
10,376 |
|
|
$ |
547,044 |
|
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings |
|
|
|
|
|
|
|
|
|
|
7,087 |
|
|
|
|
|
|
|
|
|
|
|
688 |
|
|
|
|
|
Foreign currency
translation
adjustment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(51 |
) |
|
|
|
|
|
|
263 |
|
|
|
|
|
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,987 |
|
Capital contribution from
noncontrolling interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
419 |
|
|
|
419 |
|
Purchase of additional
noncontrolling interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(844 |
) |
|
|
(844 |
) |
Distributions to
noncontrolling interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(378 |
) |
|
|
(378 |
) |
Cash dividends $0.060 per share |
|
|
|
|
|
|
|
|
|
|
(1,139 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,139 |
) |
Issuance of 77,325 shares under
employee stock plans |
|
|
77 |
|
|
|
956 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,033 |
|
Issuance of 2,965 shares under
stock grant programs |
|
|
3 |
|
|
|
82 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
85 |
|
Issuance of 11,525 shares under
deferred compensation plans |
|
|
12 |
|
|
|
(12 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Received 17,396 shares for the
exercise of stock options |
|
|
(17 |
) |
|
|
(563 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(580 |
) |
Tax benefits from non-qualified
stock options exercised |
|
|
|
|
|
|
106 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
106 |
|
Expense associated with
share-based compensation
arrangements |
|
|
|
|
|
|
564 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
564 |
|
Accrued expense under
deferred compensation plans |
|
|
|
|
|
|
494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
494 |
|
Issuance of 7,374 shares in
exchange for employee stock
notes receivable |
|
|
7 |
|
|
|
230 |
|
|
|
|
|
|
|
|
|
|
|
(237 |
) |
|
|
|
|
|
|
|
|
Payments received on employee
stock notes receivable |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27 |
|
|
|
|
|
|
|
27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 28, 2008 |
|
$ |
18,990 |
|
|
$ |
125,225 |
|
|
$ |
397,201 |
|
|
$ |
4,653 |
|
|
$ |
(1,775 |
) |
|
$ |
10,524 |
|
|
$ |
554,818 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 27, 2008 |
|
$ |
19,089 |
|
|
$ |
128,830 |
|
|
$ |
393,312 |
|
|
$ |
2,353 |
|
|
$ |
(1,701 |
) |
|
$ |
6,343 |
|
|
$ |
548,226 |
|
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings |
|
|
|
|
|
|
|
|
|
|
14,881 |
|
|
|
|
|
|
|
|
|
|
|
411 |
|
|
|
|
|
Foreign currency
translation
adjustment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
262 |
|
|
|
|
|
|
|
(37 |
) |
|
|
|
|
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,517 |
|
Purchase of additional
noncontrolling interest |
|
|
|
|
|
|
(853 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(917 |
) |
|
|
(1,770 |
) |
Distributions to
noncontrolling interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(170 |
) |
|
|
(170 |
) |
Cash dividends $0.060 per share |
|
|
|
|
|
|
|
|
|
|
(1,158 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,158 |
) |
Issuance of 65,933 shares under
employee stock plans |
|
|
66 |
|
|
|
1,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,177 |
|
Issuance of 78,706 shares under
stock grant programs |
|
|
79 |
|
|
|
10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
89 |
|
Issuance of 72,989 shares under
deferred compensation plans |
|
|
73 |
|
|
|
(73 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Received 1,530 shares for the
exercise of stock options |
|
|
(2 |
) |
|
|
(30 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(32 |
) |
Tax benefits from non-qualified
stock options exercised |
|
|
|
|
|
|
276 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
276 |
|
Change in deferred tax asset |
|
|
|
|
|
|
(518 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(518 |
) |
Expense associated with
share-based compensation
arrangements |
|
|
|
|
|
|
1,089 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,089 |
|
Accrued expense under
deferred compensation plans |
|
|
|
|
|
|
442 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
442 |
|
Issuance of 3,721 shares in
exchange for employees stock
notes receivable |
|
|
4 |
|
|
|
121 |
|
|
|
|
|
|
|
|
|
|
|
(125 |
) |
|
|
|
|
|
|
|
|
Payments received on employee
stock notes receivable |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29 |
|
|
|
|
|
|
|
29 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 27, 2009 |
|
$ |
19,309 |
|
|
$ |
130,405 |
|
|
$ |
407,035 |
|
|
$ |
2,615 |
|
|
$ |
(1,797 |
) |
|
$ |
5,630 |
|
|
$ |
563,197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See notes to unaudited consolidated condensed financial statements.
5
UNIVERSAL FOREST PRODUCTS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
June 27, |
|
|
June 28, |
|
(in thousands) |
|
2009 |
|
|
2008 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net earnings attributable to controlling interest |
|
$ |
14,881 |
|
|
$ |
7,087 |
|
Adjustments to reconcile net earnings to net cash from
operating activities: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
16,510 |
|
|
|
19,331 |
|
Amortization of intangibles |
|
|
4,520 |
|
|
|
4,778 |
|
Expense associated with
share-based compensation
arrangements |
|
|
1,089 |
|
|
|
564 |
|
Excess tax benefits from
share-based compensation
arrangements |
|
|
(211 |
) |
|
|
(42 |
) |
Expense associated with stock
grant plans |
|
|
89 |
|
|
|
85 |
|
Deferred income taxes |
|
|
195 |
|
|
|
(212 |
) |
Net earnings attributable to
noncontrolling interest |
|
|
411 |
|
|
|
688 |
|
Net (gain) loss on sale or
impairment of property, plant and
equipment |
|
|
(2,457 |
) |
|
|
573 |
|
Changes in: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(59,701 |
) |
|
|
(83,169 |
) |
Inventories |
|
|
27,980 |
|
|
|
16,043 |
|
Accounts payable |
|
|
35,576 |
|
|
|
37,659 |
|
Accrued liabilities and other |
|
|
23,798 |
|
|
|
22,170 |
|
|
|
|
|
|
|
|
NET CASH FROM OPERATING ACTIVITIES |
|
|
62,680 |
|
|
|
25,555 |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
|
(7,279 |
) |
|
|
(10,469 |
) |
Acquisitions, net of cash received |
|
|
|
|
|
|
(23,338 |
) |
Proceeds from sale of property, plant and equipment |
|
|
10,241 |
|
|
|
26,827 |
|
Advances on notes receivable |
|
|
(14 |
) |
|
|
(997 |
) |
Collections of notes receivable |
|
|
68 |
|
|
|
448 |
|
Insurance proceeds |
|
|
1,023 |
|
|
|
|
|
Other, net |
|
|
11 |
|
|
|
(97 |
) |
|
|
|
|
|
|
|
NET CASH FROM INVESTING ACTIVITIES |
|
|
4,050 |
|
|
|
(7,626 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net repayments under revolving credit facilities |
|
|
(30,257 |
) |
|
|
(28,295 |
) |
Repayment of long-term debt |
|
|
(16,213 |
) |
|
|
(492 |
) |
Borrowings of long-term debt |
|
|
800 |
|
|
|
|
|
Proceeds from issuance of common stock |
|
|
1,177 |
|
|
|
805 |
|
Additional 5% purchase of Shawnlee |
|
|
(1,770 |
) |
|
|
|
|
Distributions to noncontrolling interest |
|
|
(170 |
) |
|
|
(378 |
) |
Investment received from minority shareholder |
|
|
|
|
|
|
419 |
|
Dividends paid to shareholders |
|
|
(1,158 |
) |
|
|
(1,139 |
) |
Excess tax benefits from share-based compensation arrangements |
|
|
211 |
|
|
|
42 |
|
Other, net |
|
|
(54 |
) |
|
|
(13 |
) |
|
|
|
|
|
|
|
NET CASH FROM FINANCING ACTIVITIES |
|
|
(47,434 |
) |
|
|
(29,051 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS |
|
|
19,296 |
|
|
|
(11,122 |
) |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR |
|
|
13,337 |
|
|
|
43,605 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
|
$ |
32,633 |
|
|
$ |
32,483 |
|
|
|
|
|
|
|
|
6
UNIVERSAL FOREST PRODUCTS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS -
(CONTINUED)
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
June 27, |
|
|
June 28, |
|
(in thousands) |
|
|
2009 |
|
|
2008 |
|
SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid (refunded) during the period for: |
|
|
|
|
|
|
|
|
Interest |
|
$ |
2,790 |
|
|
$ |
6,977 |
|
Income taxes |
|
|
(6,050 |
) |
|
|
(10,330 |
) |
|
|
|
|
|
|
|
|
|
NON-CASH FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Stock acquired through employees stock notes
receivable |
|
$ |
125 |
|
|
$ |
237 |
|
|
|
|
|
|
|
|
|
|
NON-CASH FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Common stock issued under deferred compensation plans |
|
$ |
2,392 |
|
|
$ |
331 |
|
Stock received for the exercise of stock options, net |
|
|
32 |
|
|
|
352 |
|
See notes
to unaudited consolidated condensed financial statements.
7
UNIVERSAL FOREST PRODUCTS, INC.
NOTES TO UNAUDITED
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
The accompanying unaudited, interim, consolidated, condensed financial statements (the
Financial Statements) include our accounts and those of our wholly-owned and majority-owned
subsidiaries and partnerships, and have been prepared pursuant to the rules and regulations of
the Securities and Exchange Commission. Accordingly, the Financial Statements do not include
all of the information and footnotes normally included in the annual consolidated financial
statements prepared in accordance with accounting principles generally accepted in the United
States. All intercompany transactions and balances have been eliminated.
In our opinion, the Financial Statements contain all material adjustments necessary to present
fairly our consolidated financial position, results of operations and cash flows for the
interim periods presented. All such adjustments are of a normal recurring nature. These
Financial Statements should be read in conjunction with the annual consolidated financial
statements, and footnotes thereto, included in our Annual Report to Shareholders on Form 10-K
for the fiscal year ended December 27, 2008.
Effective at the beginning of the fiscal year ending December 26, 2009, we adopted SFAS No.
160, Noncontrolling Interests in Consolidated Financial Statements (SFAS 160). SFAS 160
establishes new accounting and reporting standards for the noncontrolling interest in a
subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires
the recognition of a noncontrolling interest (minority interest) as equity in the consolidated
financial statements and separate from the parents equity. The amount of net income
attributable to the noncontrolling interest will be included in consolidated net income on the
face of the income statement. SFAS 160 clarifies that changes in a parents ownership interest
in a subsidiary that do not result in deconsolidation are equity transactions if the parent
retains its controlling financial interest. In addition, this statement requires that a parent
recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss
will be measured using the fair value of the noncontrolling equity investment on the
deconsolidation date. SFAS 160 also includes expanded disclosure requirements regarding the
interests of the parent and its noncontrolling interest. The adoption of SFAS 160 did not have
a material impact on our consolidated financial statements.
Effective at the beginning of the fiscal year ending December 26, 2009, we adopted FASB Staff
Postion No. EITF 03-06-1, Determining Whether Instruments Granted in Share-Based Payment
Transactions are Participating Securities (FSP EITF 03-06-01). FSP EITF 03-06-01 clarifies
that unvested share-based payment awards with a right to receive nonforfeitable dividends are
participating securities and also provides guidance on how to allocate earnings to
participating securities and compute basic earnings per share using the two-class method.
8
UNIVERSAL FOREST PRODUCTS, INC.
The adoption of FSP EITF 03-06-01 impacts our Executive Stock Grant Plan and its related
effect on our earnings per share calculation was not significant.
Subsequent events have been evaluated through our filing date.
Effective at the beginning of the fiscal year ended December 27, 2008, we adopted SFAS No.
157, Fair Value Measurements (SFAS 157). This new standard establishes a framework for
measuring the fair value of assets and liabilities. This framework is intended to provide
increased consistency in how fair value determinations are made under various existing
accounting standards which permit, or in some cases require, estimates of fair market value.
SFAS 157 also expands financial statement disclosure requirements about a companys use of
fair value measurements, including the effect of such measures on earnings. The adoption has
not had a material impact on our consolidated financial statements. SFAS 157 requires fair
value measurements be classified and disclosed in one of three categories.
Effective at the beginning of the fiscal year ended December 26, 2009, we adopted the
nonfinancial asset and liability provisions of SFAS 157 as previously deferred by FSP No.
157-2, Effective Date of FASB Statement No. 157 (FSP 157-2).
Assets and liabilities measured at fair value are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 27, 2009 |
|
|
June 28, 2008 |
|
|
|
|
|
|
|
Quoted |
|
|
Prices |
|
|
|
|
|
|
Quoted |
|
|
Prices |
|
|
|
|
|
|
|
Prices in |
|
|
with Other |
|
|
|
|
|
|
Prices in |
|
|
with Other |
|
|
|
|
|
|
|
Active |
|
|
Observable |
|
|
|
|
|
|
Active |
|
|
Observable |
|
|
|
|
|
|
|
Markets |
|
|
Inputs |
|
|
|
|
|
|
Markets |
|
|
Inputs |
|
(in thousands) |
|
Total |
|
|
(Level 1) |
|
|
(Level 2) |
|
|
Total |
|
|
(Level 1) |
|
|
(Level 2) |
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading marketable securities |
|
$ |
749 |
|
|
$ |
749 |
|
|
|
|
|
|
$ |
4,562 |
|
|
$ |
4,562 |
|
|
|
|
|
Assets held for sale |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
410 |
|
|
|
|
|
|
$ |
410 |
|
Property, plant and equipment |
|
|
1,204 |
|
|
|
|
|
|
$ |
1,204 |
|
|
|
1,140 |
|
|
|
|
|
|
|
1,140 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,953 |
|
|
$ |
749 |
|
|
$ |
1,204 |
|
|
$ |
6,112 |
|
|
$ |
4,562 |
|
|
$ |
1,550 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective at the beginning of the fiscal year ended December 27, 2008, we adopted SFAS 159,
The Fair Value Option for Financial Assets and Financial Liabilities (SFAS 159). SFAS 159
allows companies to choose to measure certain financial instruments and certain other items at
fair value. The statement requires that unrealized gains and losses are reported in earnings
for items measured using the fair value option and establishes presentation and disclosure
requirements. We have elected not to apply the fair value option to any of our financial
instruments except for those expressly required by U.S. GAAP.
9
UNIVERSAL FOREST PRODUCTS, INC.
Earnings on construction contracts are reflected in operations using either
percentage-of-completion accounting, which includes the cost to cost and units of delivery
methods, or completed contract accounting, depending on the nature of the business at
individual
operations. Under percentage-of-completion using the cost to cost method, revenues and
related earnings on construction contracts are measured by the relationships of actual costs
incurred related to the total estimated costs. Under percentage-of-completion using the units
of delivery method, revenues and related earnings on construction contracts are measured by
the relationships of actual units produced related to the total number of units. Revisions in
earnings estimates on the construction contracts are recorded in the accounting period in
which the basis for such revisions becomes known. Projected losses on individual contracts
are charged to operations in their entirety when such losses become apparent. Under the
completed contract method, revenues and related earnings are recorded when the contracted work
is complete and losses are charged to operations in their entirety when such losses become
apparent.
The following table presents the balances of percentage-of-completion accounts which are
included in Other current assets and Accrued liabilities: Other, respectively (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 27, 2009 |
|
|
December 27, 2008 |
|
|
June 28, 2008 |
|
|
Cost and Earnings in Excess of Billings |
|
$ |
7,086 |
|
|
$ |
7,934 |
|
|
$ |
15,155 |
|
Billings in Excess of Cost and Earnings |
|
|
7,728 |
|
|
|
5,882 |
|
|
|
13,124 |
|
10
UNIVERSAL FOREST PRODUCTS, INC.
A reconciliation of the changes in the numerator and the denominator from the calculation of
basic EPS to the calculation of diluted EPS follows (in thousands, except per share data):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 27, 2009 |
|
|
Three Months Ended June 28, 2008 |
|
|
|
|
|
|
|
|
|
|
|
Per |
|
|
|
|
|
|
|
|
|
|
Per |
|
|
|
Income |
|
|
Shares |
|
|
Share |
|
|
Income |
|
|
Shares |
|
|
Share |
|
|
|
(Numerator) |
|
|
(Denominator) |
|
|
Amount |
|
|
(Numerator) |
|
|
(Denominator) |
|
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings Attributable to Controlling Interest |
|
$ |
16,088 |
|
|
|
|
|
|
|
|
|
|
$ |
11,663 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income available to common stockholders |
|
|
16,088 |
|
|
|
19,241 |
|
|
$ |
0.84 |
|
|
|
11,663 |
|
|
|
19,048 |
|
|
$ |
0.61 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options |
|
|
|
|
|
|
218 |
|
|
|
|
|
|
|
|
|
|
|
219 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income available to common stockholders and
assumed options exercised |
|
$ |
16,088 |
|
|
|
19,459 |
|
|
$ |
0.83 |
|
|
$ |
11,663 |
|
|
|
19,267 |
|
|
$ |
0.61 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 27, 2009 |
|
|
Six Months Ended June 28, 2008 |
|
|
|
|
|
|
|
|
|
|
|
Per |
|
|
|
|
|
|
|
|
|
|
Per |
|
|
|
Income |
|
|
Shares |
|
|
Share |
|
|
Income |
|
|
Shares |
|
|
Share |
|
|
|
(Numerator) |
|
|
(Denominator) |
|
|
Amount |
|
|
(Numerator) |
|
|
(Denominator) |
|
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings Attributable to Controlling Interest |
|
$ |
14,881 |
|
|
|
|
|
|
|
|
|
|
$ |
7,087 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income available to common stockholders |
|
|
14,881 |
|
|
|
19,213 |
|
|
$ |
0.77 |
|
|
|
7,087 |
|
|
|
19,022 |
|
|
$ |
0.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options |
|
|
|
|
|
|
157 |
|
|
|
|
|
|
|
|
|
|
|
202 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income available to common stockholders and
assumed options exercised |
|
$ |
14,881 |
|
|
|
19,370 |
|
|
$ |
0.77 |
|
|
$ |
7,087 |
|
|
|
19,224 |
|
|
$ |
0.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
UNIVERSAL FOREST PRODUCTS, INC.
Options to purchase 10,000 shares of common stock were not included in the computation of
diluted EPS for the quarter ended June 27, 2009 because the options exercise price was
greater than the average market price of the common stock during the period and, therefore
would be antidilutive.
Options to purchase 120,000 shares of common stock were not included in the computation of
diluted EPS for the six months ended June 27, 2009 because the options exercise price was
greater than the average market price of the common stock during the period and, therefore
would be antidilutive.
Options to purchase 10,000 shares of common stock were not included in the computation of
diluted EPS for the quarter and six months ended June 28, 2008 because the options exercise
price was greater than the average market price of the common stock during the period and,
therefore would be antidilutive.
E. |
|
SALE OF ACCOUNTS RECEIVABLE |
On March 8, 2006 we entered into an accounts receivable sale arrangement with a bank that was
terminated on September 26, 2008. Under the terms of this arrangement:
|
|
|
We sold specific receivables to the bank at an agreed-upon price at terms ranging from
one month to one year. |
|
|
|
|
We serviced the receivables sold and outstanding on behalf of the bank at a rate of
0.50% per annum. |
|
|
|
|
We received an incentive servicing fee, which we account for as a retained interest in
the receivables sold. Our retained interest is determined based on the fair market value
of anticipated collections in excess of the Agreed Base Value of the receivables sold.
Appropriate valuation allowances are recorded against the retained interest. |
|
|
|
|
The maximum amount of receivables, net of retained interest, which may be sold and
outstanding at any point in time under this arrangement was $50 million. |
No receivables were outstanding as of June 27, 2009. On June 28, 2008, $54.1 million of
receivables were sold and outstanding, and we recorded $4.1 million of retained interest in
Other current assets. A summary of the transactions we completed for the first six months
of 2008 are presented below (in thousands).
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
June 28, 2008 |
|
Accounts receivable sold |
|
$ |
295,800 |
|
Retained interest in receivables |
|
|
(2,432 |
) |
Expense from sale |
|
|
(818 |
) |
Servicing fee received |
|
|
111 |
|
|
|
|
|
Net cash received from sale |
|
$ |
292,661 |
|
|
|
|
|
12
UNIVERSAL FOREST PRODUCTS, INC.
F. |
|
ASSETS HELD FOR SALE AND NET (GAIN) LOSS ON DISPOSITION OF ASSETS AND OTHER IMPAIRMENTS AND
EXIT CHARGES |
Included in Assets held for sale on our Consolidated Condensed Balance Sheets are certain
property, plant and equipment totaling $3.1 million on June 27, 2009 and $10.3 million on June
28, 2008. The assets held for sale consist of certain vacant land and several facilities we
closed to better align manufacturing capacity with the current business environment. The fair
values were determined based on appraisals or recent offers to acquire the assets. These and
other idle assets were evaluated based on the requirements of SFAS 144, which resulted in
certain impairment and other exit charges. Net (gain) loss on disposition of assets and other
impairment and exit charges consists of the following amounts, separated by reporting
segment, for the periods presented below (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 27, 2009 |
|
|
Three Months Ended June 28, 2008 |
|
|
|
Eastern and |
|
|
|
|
|
|
Eastern and |
|
|
|
|
|
|
Western |
|
|
All |
|
|
Western |
|
|
All |
|
|
|
Divisions |
|
|
Other |
|
|
Divisions |
|
|
Other |
|
Severances |
|
$ |
142 |
|
|
|
|
|
|
$ |
97 |
|
|
|
|
|
Property, plant and
equipment |
|
|
273 |
|
|
|
|
|
|
|
311 |
|
|
|
|
|
Gain on sale of
real estate |
|
|
(1,131 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 27, 2009 |
|
|
Six Months Ended June 28, 2008 |
|
|
|
Eastern and |
|
|
|
|
|
|
Eastern and |
|
|
|
|
|
|
Western |
|
|
All |
|
|
Western |
|
|
All |
|
|
|
Divisions |
|
|
Other |
|
|
Divisions |
|
|
Other |
|
Severances |
|
$ |
605 |
|
|
|
|
|
|
$ |
685 |
|
|
|
|
|
Property, plant and
equipment |
|
|
1,063 |
|
|
|
|
|
|
|
573 |
|
|
|
|
|
Gain on sale
of real estate |
|
|
(3,520 |
) |
|
|
|
|
|
|
(43 |
) |
|
|
|
|
The changes in assets held for sale in 2009 are as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Book |
|
|
|
|
|
|
Net Sale |
|
Description |
|
Value |
|
|
Date of Sale |
|
|
Price |
|
Assets held for sale as of December 27, 2008 |
|
$ |
8,296 |
|
|
|
|
|
|
|
|
|
Additions |
|
|
1,030 |
|
|
|
|
|
|
|
|
|
Sale of certain real estate in Woodburn, Oregon |
|
|
(2,806 |
) |
|
February 6, 2009 |
|
$5.2 million |
Sale of certain real estate in Dallas, Texas |
|
|
(2,433 |
) |
|
May 13, 2009 |
|
$3.4 million |
Sale of certain real estate in Murrieta, California |
|
|
(1,030 |
) |
|
June 10, 2009 |
|
$0.9 million |
|
|
|
|
|
|
|
|
|
|
|
|
Assets held for sale as of June 27, 2009 |
|
$ |
3,057 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
UNIVERSAL FOREST PRODUCTS, INC.
G. |
|
COMMITMENTS, CONTINGENCIES, AND GUARANTEES |
We are self-insured for environmental impairment liability, including certain liabilities
which are insured through a wholly owned subsidiary, UFP Insurance Ltd., a licensed captive
insurance company.
We own and operate a number of facilities throughout the United States that chemically treat
lumber products. In connection with the ownership and operation of these and other real
properties, and the disposal or treatment of hazardous or toxic substances, we may, under
various federal, state, and local environmental laws, ordinances, and regulations, be
potentially liable for removal and remediation costs, as well as other potential costs, damages, and
expenses. Environmental reserves, calculated with no discount rate, have been established to
cover remediation activities at our affiliates wood preservation facilities in Stockertown,
PA; Elizabeth City, NC; Auburndale, FL; Gordon, PA; Janesville, WI; Medley, FL; and Ponce, PR.
In addition, a reserve was established for our affiliates facility in Thornton, CA to remove
certain lead containing materials which existed on the property at the time of purchase.
During the second quarter, a subsidiary entered into a consent order with the State of Florida
to conduct additional testing at the Auburndale, FL facility. We admitted no liability and
the costs are not expected to be material.
On a consolidated basis, we have reserved approximately $4.3 million on June 27, 2009 and $4.4
million on June 28, 2008, representing the estimated costs to complete future remediation
efforts. These amounts have not been reduced by an insurance receivable.
From time to time, various special interest environmental groups have petitioned certain
states requesting restrictions on the use or disposal of CCA treated products. The wood
preservation industry trade groups are working with the individual states and their regulatory
agencies to provide an accurate, factual background which demonstrates that the present method
of uses and disposal is scientifically supported. We market a modest amount of CCA treated
products for permitted, non-residential applications.
We have not accrued for any potential loss related to the contingencies above. However,
potential liabilities of this nature are not conducive to precise estimates and are subject to
change.
In addition, on June 27, 2009, we were parties either as plaintiff or a defendant to a number
of lawsuits and claims arising through the normal course of our business. In the opinion of
management, our consolidated financial statements will not be materially affected by the
outcome of these contingencies and claims.
On June 27, 2009, we had outstanding purchase commitments on capital projects of approximately
$1.2 million.
14
UNIVERSAL FOREST PRODUCTS, INC.
We provide a variety of warranties for products we manufacture. Historically, warranty claims
have not been material.
In certain cases we supply building materials and labor to site-built construction projects or
we jointly bid on contracts with framing companies for such projects. In some instances we are
required to post payment and performance bonds to insure the owner that the products and
installation services are completed in accordance with our contractual obligations. We have
agreed to indemnify the surety for claims made against the bonds. As of June 27, 2009, we had
approximately $16.7 million in outstanding payment and performance bonds, which expire during
the next two years. In addition, approximately $24.4 million in payment and performance bonds
are outstanding for completed projects which are still under warranty.
We have entered into operating leases for certain personal property assets that include a
guarantee of a portion of the residual value of the leased assets. If at the expiration of
the initial lease term we do not exercise our option to purchase the leased assets and these
assets are sold by the lessor for a price below a predetermined amount, we will reimburse the
lessor for a certain portion of the shortfall. These operating leases will expire
periodically over the next five years. The estimated maximum aggregate exposure of these
guarantees is approximately $2.0 million.
On June 27, 2009, we had outstanding letters of credit totaling $32.2 million, primarily
related to certain insurance contracts and industrial development revenue bonds as further
described below.
In lieu of cash deposits, we provide irrevocable letters of credit in favor of our insurers to
guarantee our performance under certain insurance contracts. We currently have irrevocable
letters of credit outstanding totaling approximately $17.4 million for these types of
insurance arrangements. We have reserves recorded on our balance sheet, in accrued
liabilities, that reflect our expected future liabilities under these insurance arrangements.
We are required to provide irrevocable letters of credit in favor of the bond trustees for all
of the industrial development revenue bonds that we have issued. These letters of credit
guarantee principal and interest payments to the bondholders. We currently have irrevocable
letters of credit outstanding totaling approximately $14.8 million related to our outstanding
industrial development revenue bonds. These letters of credit have varying terms but may be
renewed at the option of the issuing banks.
Certain wholly owned domestic subsidiaries have guaranteed the indebtedness of Universal
Forest Products, Inc. in certain debt agreements, including the Series 2002-A Senior Notes and
our revolving credit facility. The maximum exposure of these guarantees is limited to the
indebtedness outstanding under these debt arrangements and this exposure will expire
concurrent with the expiration of the debt agreements.
15
UNIVERSAL FOREST PRODUCTS, INC.
Many of our wood treating operations utilize Subpart W drip pads, defined as hazardous waste
management units by the EPA. The rules regulating drip pads require that the pad be closed
at the point that it is no longer intended to be used for wood treating operations or to
manage hazardous waste. Closure involves identification and disposal of contaminants which
are required to be removed from the facility. The cost of closure is dependent upon a number
of factors including, but not limited to, identification and removal of contaminants, cleanup
standards that vary from state to state, and the time period over which the cleanup would be
completed. Based on our present knowledge of existing circumstances, it is considered
probable that these costs will approximate $0.4 million. As a result, this amount is recorded
in other long-term liabilities on June 27, 2009.
We did not enter into any new guarantee arrangements during the second quarter of 2009 which
would require us to recognize a liability on our balance sheet.
No business combinations were completed in fiscal 2009. We completed the following business
combinations in fiscal 2008 which were accounted for using the purchase method (in millions).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net |
|
|
|
|
|
|
Company |
|
Acquisition |
|
|
Purchase |
|
|
Intangible |
|
|
Tangible |
|
|
Reportable |
|
|
|
Name |
|
Date |
|
|
Price |
|
|
Assets |
|
|
Assets |
|
|
Segment |
|
Business Description |
D-Stake Mill and Manufacturing Country (D-Stake) |
|
June 9, 2008 |
|
$7.1 (asset purchase) |
|
$ |
5.1 |
|
|
$ |
2.0 |
|
|
Western Division |
|
Manufactures kiln stickers, lath, stakes, decking, and pallets and pallet components for a variety of industries including manufacturing, retail and agriculture. Plants are located in McMinnville, OR and Independence, OR. Combined 2007 sales were $18.5 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased 100% of the inventory, property, plant and equipment, and intangibles |
Shawnlee Construction, LLC (Shawnlee) |
|
April 1, 2008 |
|
$1.8 (asset purchase) |
|
$ |
1.0 |
|
|
$ |
0.8 |
|
|
Eastern Division |
|
Provides framing services for multi-family construction in the northeast. Located in Plainville, MA. As of April 1, 2008 we owned a 90% membership interest and have purchased and additional 5% interest each year. |
Romano Construction Company, Ltd. (Romano) |
|
March 15, 2008 |
|
$0.4 (asset purchase) |
|
$ |
0.2 |
|
|
$ |
0.2 |
|
|
Eastern Division |
|
Provides framing services and is located in Middletown, NY.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased 100% of the property, plant and equipment and intangibles |
International Wood Industries, Inc. (IWI) |
|
February 4, 2008 |
|
$14.0 (stock purchase) |
|
$ |
10.6 |
|
|
$ |
3.4 |
|
|
Western Division |
|
Manufactures and distributes industrial products, including specialty boxes, crates, pallets and skids. Headquartered in Turlock, CA with distribution sites in Hawaii and Alaska. 2007 sales were $40.0 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased 100% voting interest |
16
UNIVERSAL FOREST PRODUCTS, INC.
The purchase price allocation for D-Stake is final and any adjustments will be recognized
in the income statement. The amounts assigned to major intangible classes for business
combinations mentioned above are as follows (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
|
Non-compete |
|
|
Customer |
|
|
Goodwill |
|
|
Tax |
|
|
|
agreements |
|
|
Relationships |
|
|
Total |
|
|
Deductible |
|
D-Stake |
|
$ |
2.6 |
|
|
|
|
|
|
$ |
2.5 |
|
|
$ |
2.5 |
|
Shawnlee |
|
|
0.3 |
|
|
$ |
0.4 |
|
|
|
0.3 |
|
|
|
0.3 |
|
The purchase price allocation for IWI was finalized during the first quarter as follows (in
millions).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
|
Non-compete |
|
|
Customer |
|
|
Goodwill |
|
|
Tax |
|
|
|
agreements |
|
|
Relationships |
|
|
Total |
|
|
Deductible |
|
IWI preliminary |
|
|
5.4 |
|
|
|
|
|
|
|
5.2 |
|
|
|
|
|
Final purchase price allocations |
|
|
(3.0 |
) |
|
|
5.6 |
|
|
|
(2.6 |
) |
|
|
|
|
IWI final |
|
|
2.4 |
|
|
|
5.6 |
|
|
|
2.6 |
|
|
|
0.0 |
|
The business combinations mentioned above were not significant to our operating results
individually or in aggregate, and thus pro forma results are not presented.
SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information (SFAS 131)
defines operating segments as components of an enterprise about which separate financial
information is available that is evaluated regularly by the chief operating decision maker in
deciding how to allocate resources and in assessing performance.
17
UNIVERSAL FOREST PRODUCTS, INC.
Under the definition of a segment, our Eastern, Western and Consumer Products Divisions may be
considered an operating segment of our business. Under SFAS 131, segments may be aggregated
if the segments have similar economic characteristics and if the nature of the products,
distribution methods, customers and regulatory environments are similar. Based on this
criteria, we have aggregated our Eastern and Western Divisions into one reporting segment. Our
Consumer Products Division is included in the All Other column in the table below. Our
divisions operate manufacturing and treating facilities throughout North America. A summary of
results for the first six months of 2009 and 2008 are presented below (in thousands).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 27, 2009 |
|
|
Six Months Ended June 28, 2008 |
|
|
|
Eastern |
|
|
|
|
|
|
|
|
|
|
Eastern |
|
|
|
|
|
|
|
|
|
and |
|
|
|
|
|
|
|
|
|
|
and |
|
|
|
|
|
|
|
|
|
Western |
|
|
|
|
|
|
|
|
|
|
Western |
|
|
|
|
|
|
|
|
|
Divisions |
|
|
All Other |
|
|
Total |
|
|
Divisions |
|
|
All Other |
|
|
Total |
|
Net sales to outside customers |
|
$ |
812,108 |
|
|
$ |
64,559 |
|
|
$ |
876,667 |
|
|
$ |
1,152,132 |
|
|
$ |
45,865 |
|
|
$ |
1,197,997 |
|
Intersegment net sales |
|
|
0 |
|
|
|
20,950 |
|
|
|
20,950 |
|
|
|
0 |
|
|
|
16,015 |
|
|
|
16,015 |
|
Segment operating profit |
|
|
21,432 |
|
|
|
4,614 |
|
|
|
26,046 |
|
|
|
16,238 |
|
|
|
1,989 |
|
|
|
18,227 |
|
18
UNIVERSAL FOREST PRODUCTS, INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Included in this report are certain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. The forward-looking statements are based on the beliefs and assumptions of management,
together with information available to us when the statements were made. Future results could
differ materially from those included in such forward-looking statements as a result of, among
other things, the factors set forth below and certain economic and business factors which may be
beyond our control. Investors are cautioned that all forward-looking statements involve risks and
uncertainty. We also encourage you to read our Annual Report on Form 10-K, filed with the United
States Securities and Exchange Commission. That report includes Risk Factors that you should
consider in connection with any decision to buy or sell our securities. We are pleased to present
this overview of 2009.
OVERVIEW
Our results for the second quarter of 2009 were impacted by the following:
|
|
We experienced sales decreases in all of our markets; nonetheless, we believe we have
gained additional share in each of the markets we serve, except manufactured housing. We have
been able to maintain our significant share of the manufactured housing market. |
|
|
Our overall unit sales decreased 19%, as sales out of existing facilities and operations we
closed decreased by 20% this quarter and we experienced a 1% increase in unit sales as a
result of acquisitions. |
|
|
Single-family housing starts decreased approximately 43% in April and May of 2009, compared
to the same periods of 2008, as a result of an excess supply of homes, tight credit
conditions, and an increase in foreclosures. In addition multi-family and commercial
construction has decreased approximately 65% and 34%, respectively, in April and May 2009
compared to the same periods of 2008. |
|
|
Consumer spending for large repair/remodel projects has decreased due to general economic
conditions, among other factors. The Consumer Confidence Index has fallen from 51 in June of
2008 to 49 in June of 2009, and the same store sales of big box home improvement retailers
have declined by low double-digit rates. |
|
|
Shipments of HUD code manufactured homes were down 46% in April and 45% in May of 2009,
compared to the same periods of 2008. Industry sales of modular homes have also continued to
decline. Weak market conditions are due, in part, to an excess supply of site-built homes and
tight credit conditions. |
19
UNIVERSAL FOREST PRODUCTS, INC.
|
|
The industrial market has declined due to the general weakening of the U.S. economy. We
gained additional share of this market due, in part, to acquisitions and adding new concrete
forming business. |
|
|
Our gross margin increased to 16.0% from 12.0% in 2008 primarily due to: |
|
|
|
An improvement in material costs as a percentage of net sales. |
|
|
|
|
An improvement in labor and plant overhead as a percentage of net sales. |
|
|
|
|
Lower freight costs. |
|
|
|
|
The lower level of the Lumber Market. |
|
|
Our SG&A expenses are down approximately $5.7 million, or 9%, from the second quarter of 2008, due to our right-sizing
efforts and plant consolidation actions we took last year, offset somewhat by an increase in bad debt and incentive
compensation expense. |
|
|
Our net interest costs decreased by $1.8 million, or 57%, as our interest-bearing debt and amounts outstanding under
our sale of receivables program declined from $178 million at the end of June of 2008 to $56 million at the end of June
of 2009. This decrease was slightly offset by approximately $360,000 of expense related to a make-whole provision we
incurred by electing to pay off a $15 million senior unsecured note six months early. We will save approximately
$420,000 in the last six months of 2009 because of this pre-payment. |
|
|
We are pleased to report operating and investing cash flows totaling almost $67 million for the first six months of
2009 due to improved profitability, effective working capital management, and reduced working capital requirements due
to weak demand. |
Outlook
We expect the current challenging conditions to prevail throughout 2009; however, our strong
financial position, solid business model, diverse business opportunities and ability to adjust
appropriately to our opportunities position us well to endure challenging times. We believe that
current economic conditions and uncertainties limit our ability to provide meaningful guidance for
ranges of likely financial performance; therefore, we will not provide annual sales or net earnings
targets for the foreseeable future.
Route 2012
Since we discussed our Growth & Opportunity 2010 (GO 2010) goals in our annual report on form
10-K for the period ended December 30, 2006, industry and general economic conditions have
significantly deteriorated. In addition, the Lumber Market has declined from an average of
$388/mbf in 2005 to an average of $203/mbf in 2009; a 48% decline from when we first set our goals,
which has adversely impacted our sales.
20
UNIVERSAL FOREST PRODUCTS, INC.
In place of our GO 2010 goals, we have a new four-year growth plan titled Route 2012, which
includes goals to be achieved by the end of our fiscal year 2012 including:
|
|
Increase sales to $3 billion. |
|
|
Improve productivity by 15% through our Continuous Improvement initiative. |
|
|
Improve profitability by three hundred basis points through productivity improvements, cost
reductions, and growth. |
|
|
Improve receivables cycles in our industrial, site-built and manufactured housing markets
by 10% by reducing the amount of our receivables that are paid past the agreed upon due date. |
|
|
Improve inventory turnover by 10%. |
HISTORICAL LUMBER PRICES
The following table presents the Random Lengths framing lumber composite price for the six months
ended June 27, 2009 and June 28, 2008:
|
|
|
|
|
|
|
|
|
|
|
Random Lengths Composite |
|
|
|
Average $/MBF |
|
|
|
2009 |
|
|
2008 |
|
|
|
|
|
|
|
|
|
|
January |
|
$ |
198 |
|
|
$ |
249 |
|
February |
|
|
199 |
|
|
|
244 |
|
March |
|
|
195 |
|
|
|
240 |
|
April |
|
|
208 |
|
|
|
255 |
|
May |
|
|
198 |
|
|
|
281 |
|
June |
|
|
222 |
|
|
|
268 |
|
|
|
|
|
|
|
|
|
|
Second quarter average |
|
$ |
209 |
|
|
$ |
268 |
|
Year-to-date average |
|
$ |
203 |
|
|
$ |
256 |
|
|
|
|
|
|
|
|
|
|
Second quarter percentage
change from 2008 |
|
|
(22.0 |
%) |
|
|
|
|
Year-to-date percentage
change from 2008 |
|
|
(20.7 |
%) |
|
|
|
|
In addition, a Southern Yellow Pine (SYP) composite price, which we prepare and use, is presented
below. Sales of products produced using this species, which primarily consists of our
preservative-treated products, may comprise up to 50% of our sales volume.
21
UNIVERSAL FOREST PRODUCTS, INC.
|
|
|
|
|
|
|
|
|
|
|
Random Lengths SYP |
|
|
|
Average $/MBF |
|
|
|
2009 |
|
|
2008 |
|
|
|
|
|
|
|
|
|
|
January |
|
$ |
241 |
|
|
$ |
269 |
|
February |
|
|
233 |
|
|
|
264 |
|
March |
|
|
232 |
|
|
|
264 |
|
April |
|
|
241 |
|
|
|
272 |
|
May |
|
|
231 |
|
|
|
324 |
|
June |
|
|
236 |
|
|
|
318 |
|
|
|
|
|
|
|
|
|
|
Second quarter average |
|
$ |
236 |
|
|
$ |
285 |
|
Year-to-date average |
|
$ |
236 |
|
|
$ |
305 |
|
|
|
|
|
|
|
|
|
|
Second quarter percentage
change from 2008 |
|
|
(17.2 |
%) |
|
|
|
|
Year-to-date percentage
change from 2008 |
|
|
(22.6 |
%) |
|
|
|
|
IMPACT OF THE LUMBER MARKET ON OUR OPERATING RESULTS
We experience significant fluctuations in the cost of commodity lumber products from primary
producers (Lumber Market). We generally price our products to pass lumber costs through to our
customers so that our profitability is based on the value-added manufacturing, distribution,
engineering, and other services we provide. As a result, our sales levels (and working capital
requirements) are impacted by the lumber costs of our products. Lumber costs are a significant
percentage of our cost of goods sold.
Our gross margins are impacted by both (1) the relative level of the Lumber Market (i.e.
whether prices are higher or lower from comparative periods), and (2) the trend in the
market price of lumber (i.e. whether the price of lumber is increasing or decreasing within a
period or from period to period). Moreover, as explained below, our products are priced
differently. Some of our products have fixed selling prices, while the selling prices of other
products are indexed to the reported Lumber Market with a fixed dollar adder to cover conversion
costs and profits. Consequently, the level and trend of the Lumber Market impact
our products differently.
Below is a general description of the primary ways in which our products are priced.
|
|
Products with fixed selling prices. These products include value-added products
such as decking and fencing sold to DIY/retail customers, as well as trusses,
wall panels and other components sold to the site-built construction market, and
most industrial packaging products. Prices for these products are generally
fixed at the time of the sales quotation for a specified period of time or are
based upon a specific quantity. In order to maintain margins and reduce any
exposure to adverse trends in the price of component lumber products, we attempt
to lock in costs for these sales commitments with our suppliers. Also, the time
period and quantity limitations generally allow us to re-price our products for
changes in lumber costs from our suppliers. |
22
UNIVERSAL FOREST PRODUCTS, INC.
|
|
Products with selling prices indexed to the reported Lumber Market with a fixed
dollar adder to cover conversion costs and profits. These products primarily
include treated lumber, remanufactured lumber, and trusses sold to the
manufactured housing industry. For these products, we estimate the customers
needs and carry anticipated levels of inventory. Because lumber costs are
incurred in advance of final sale prices, subsequent increases or decreases in
the market price of lumber impact our gross margins. For these products, our
margins are exposed to changes in the trend of lumber prices. |
Changes
in the trend of lumber prices have their greatest impact on the following products:
|
|
Products with significant inventory levels with low turnover rates, whose
selling prices are indexed to the Lumber Market. In other words, the longer the
period of time these products remain in inventory, the greater the exposure to
changes in the price of lumber. This would include treated lumber, which
comprises approximately 12% of our total sales. This exposure is less
significant with remanufactured lumber, trusses sold to the manufactured housing
market, and other similar products, due to the higher rate of inventory
turnover. We attempt to mitigate the risk associated with treated lumber
through vendor consignment inventory programs. (Please refer to the Risk
Factors section of our annual report on form 10-K, filed with the United States
Securities and Exchange Commission.) |
|
|
Products with fixed selling prices sold under long-term supply arrangements,
particularly those involving multi-family construction projects. We attempt to
mitigate this risk through our purchasing practices by locking in costs. |
In addition to the impact of the Lumber Market trends on gross margins, changes in the
level of the market cause fluctuations in gross margins when comparing operating results
from period to period. This is explained in the following example, which assumes the price of
lumber has increased from period one to period two, with no changes in the trend within
each period.
|
|
|
|
|
|
|
|
|
|
|
Period 1 |
|
|
Period 2 |
|
|
Lumber cost |
|
$ |
300 |
|
|
$ |
400 |
|
Conversion cost |
|
|
50 |
|
|
|
50 |
|
|
|
|
|
|
|
|
= Product cost |
|
|
350 |
|
|
|
450 |
|
Adder |
|
|
50 |
|
|
|
50 |
|
|
|
|
|
|
|
|
= Sell price |
|
$ |
400 |
|
|
$ |
500 |
|
Gross margin |
|
|
12.5 |
% |
|
|
10.0 |
% |
As is apparent from the preceding example, the level of lumber prices does not impact our
overall profits, but does impact our margins. Gross margins are negatively impacted during periods
of high lumber prices; conversely, we experience margin improvement when lumber prices are
relatively low.
23
UNIVERSAL FOREST PRODUCTS, INC.
BUSINESS COMBINATIONS
See Notes to Consolidated Condensed Financial Statements, Note H, Business Combinations.
RESULTS OF OPERATIONS
The following table presents, for the periods indicated, the components of our Consolidated
Condensed Statements of Earnings as a percentage of net sales.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Six Months Ended |
|
|
|
June 27, 2009 |
|
|
June 28, 2008 |
|
|
June 27, 2009 |
|
|
June 28, 2008 |
|
|
Net sales |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
Cost of goods sold |
|
|
84.0 |
|
|
|
88.0 |
|
|
|
85.2 |
|
|
|
88.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
16.0 |
|
|
|
12.0 |
|
|
|
14.8 |
|
|
|
11.6 |
|
Selling, general,
and administrative
expenses |
|
|
10.9 |
|
|
|
8.7 |
|
|
|
12.0 |
|
|
|
10.0 |
|
Net (gain) loss on
disposition of
assets and other
impairment and exit
charges |
|
|
(0.1 |
) |
|
|
0.1 |
|
|
|
(0.2 |
) |
|
|
0.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from
operations |
|
|
5.2 |
|
|
|
3.2 |
|
|
|
3.0 |
|
|
|
1.5 |
|
Interest, net |
|
|
0.2 |
|
|
|
0.4 |
|
|
|
0.3 |
|
|
|
0.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before
income taxes |
|
|
5.0 |
|
|
|
2.8 |
|
|
|
2.7 |
|
|
|
1.0 |
|
Income taxes |
|
|
1.9 |
|
|
|
1.1 |
|
|
|
1.0 |
|
|
|
0.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings |
|
|
3.1 |
|
|
|
1.7 |
|
|
|
1.7 |
|
|
|
0.7 |
|
Less net earnings
attributable to
noncontrolling
interest |
|
|
(0.0 |
) |
|
|
(0.1 |
) |
|
|
(0.0 |
) |
|
|
(0.1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to
controlling
interest |
|
|
3.1 |
% |
|
|
1.6 |
% |
|
|
1.7 |
% |
|
|
0.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS SALES
We market, manufacture and engineer wood and wood-alternative products for the DIY/retail market,
structural lumber products for the manufactured housing market, engineered wood components for the
site-built construction market, and specialty wood packaging for various markets. We also provide
framing services for the site-built construction market and various forms for concrete
construction. Our strategic long-term sales objectives include:
|
|
Diversifying our end market sales mix by increasing sales of specialty wood packaging to industrial users, increasing
our penetration of the concrete forms market, and increasing our sales of engineered wood components for custom home,
multi-family and light commercial construction. |
|
|
Expanding geographically in our core businesses. |
24
UNIVERSAL FOREST PRODUCTS, INC.
|
|
Increasing sales of value-added products and framing services. Value-added product sales primarily consist of
fencing, decking, lattice, and other specialty products sold to the DIY/retail market, specialty wood packaging,
engineered wood components, and wood alternative products. Engineered wood components include roof trusses, wall
panels, and floor systems. Wood alternative products consist primarily of composite wood and plastics. Although we
consider the treatment of dimensional lumber with certain chemical preservatives a value-added process, treated lumber
is not presently included in the value-added sales totals. |
|
|
Maximizing unit sales growth while achieving return on investment goals. |
The following table presents, for the periods indicated, our gross sales (in thousands) and
percentage change in gross sales by market classification.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Six Months Ended |
|
|
|
June 27, |
|
|
June 28, |
|
|
% |
|
|
June 27, |
|
|
June 28, |
|
|
% |
|
Market Classification |
|
2009 |
|
|
2008 |
|
|
Change |
|
|
2009 |
|
|
2008 |
|
|
Change |
|
DIY/Retail |
|
$ |
291,540 |
|
|
$ |
337,061 |
|
|
|
(13.5 |
) |
|
$ |
459,674 |
|
|
$ |
512,520 |
|
|
|
(10.3 |
) |
Site-Built Construction |
|
|
60,830 |
|
|
|
132,085 |
|
|
|
(54.0 |
) |
|
|
121,595 |
|
|
|
239,093 |
|
|
|
(49.1 |
) |
Industrial |
|
|
131,281 |
|
|
|
172,285 |
|
|
|
(23.8 |
) |
|
|
234,940 |
|
|
|
311,893 |
|
|
|
(24.7 |
) |
Manufactured Housing |
|
|
44,668 |
|
|
|
84,167 |
|
|
|
(46.9 |
) |
|
|
81,218 |
|
|
|
160,609 |
|
|
|
(49.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross Sales |
|
|
528,319 |
|
|
|
725,598 |
|
|
|
(27.2 |
) |
|
|
897,427 |
|
|
|
1,224,115 |
|
|
|
(26.7 |
) |
Sales Allowances |
|
|
(13,374 |
) |
|
|
(17,113 |
) |
|
|
|
|
|
|
(20,760 |
) |
|
|
(26,118 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Net Sales |
|
$ |
514,945 |
|
|
$ |
708,485 |
|
|
|
(27.3 |
) |
|
$ |
876,667 |
|
|
$ |
1,197,997 |
|
|
|
(26.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: |
|
In the first quarter of 2009, we reviewed the classification of our customers and made
certain reclassifications. Prior year information has been restated to reflect these
reclassifications. |
Gross sales in the second quarter of 2009 decreased 27% compared to the second quarter of 2008. We
estimate that our unit sales decreased by 19% and overall selling prices decreased by 8% comparing
the two periods. We estimate that our unit sales increased 1% as a result of business
acquisitions, while unit sales from existing and closed facilities decreased 20%. Our overall
selling prices may fluctuate as a result of the Lumber Market (see Historical Lumber Prices) and
competitive factors.
Gross sales in the first six months of 2009 decreased 27% compared to the first six months of 2008
resulting from an estimated decrease in units shipped of approximately 20%, while overall selling
prices decreased by 7%. We estimate that our unit sales increased 1% as a result of business
acquisitions and new plants, while our unit sales from existing and closed facilities decreased by
21%.
25
UNIVERSAL FOREST PRODUCTS, INC.
Changes in our sales by market are discussed below.
DIY/Retail:
Gross sales to the DIY/retail market decreased 14% in the second quarter of 2009 compared to 2008
primarily due to an estimated 6% decrease in overall unit sales and an estimated 8% decrease in
overall selling prices due to the Lumber Market. We estimate that our unit sales increased 1% as a
result of acquisitions, while unit sales from existing and closed facilities decreased 7%. Unit
sales declined due to the impact of the housing market on our retail customers whose business is
closely correlated with single-family housing starts and a decline in consumer spending as
evidenced by low double-digit declines in same store sales reported by our big box customers. We
achieved market share gains in 2009 which offset some of the impact of these adverse market
conditions.
Gross sales to the DIY/retail market decreased 10% in the first six months of 2009 compared to 2008
primarily due to an estimated 4% decrease in overall unit sales and an estimated 6% decrease in
overall selling prices due to the Lumber Market. We estimate that our unit sales increased 1% as a
result of acquisitions, while unit sales from existing and closed facilities decreased 5%. The
decrease in unit sales is primarily due to the same factors mentioned in the paragraph above.
Site-Built Construction:
Gross sales to the site-built construction market decreased 54% in the second quarter of 2009
compared to 2008 due to an estimated 42% decrease in unit sales out of existing plants and an
estimated 12% decrease in our average selling prices primarily due to the Lumber Market. National
single-family housing starts were off a reported 43% for April and May of 2009 compared to the same
period of 2008. Multi-family and commercial construction activity declined approximately 65% and
34%, respectively, in April and May 2009 compared to the same period of 2008.
Gross sales to the site-built construction market decreased 49% in the first six months of 2009
compared to 2008, due to an estimated 39% decrease in unit sales and an estimated 10% decrease in
selling prices. National single-family housing starts were off a reported 40% through May of 2009
compared to the same period of 2008. Multi-family and commercial construction activity declined
approximately 55% and 25%, respectively, through May of 2009 compared to the same period of 2008.
Industrial:
Gross sales to the industrial market decreased 24% in the second quarter of 2009 compared to the
same period of 2008, due to an estimated 15% decrease in unit sales and an estimated 9% decrease in
selling prices. We continue to experience a decline in sales to certain of our customers that
supply the housing market or have been impacted by the weakening U.S. economy. We have been able
to offset some of the impact of a decline in demand with market share gains and our continued
penetration of the concrete forming market.
26
UNIVERSAL FOREST PRODUCTS, INC.
Gross sales to the industrial market decreased 25% in the first six months of 2009 compared to the
same period of 2008, due to an estimated 20% decrease in units and an estimated 5% decrease in
selling prices. Unit sales decreased for the reasons mentioned in the paragraph above.
Manufactured Housing:
Gross sales to the manufactured housing market decreased 47% in the second quarter of 2009 compared
to the same period of 2008, primarily due to an estimated 41% decrease in unit sales and an
estimated 6% decrease in selling prices due to the Lumber Market. Our decline in unit sales was
the result of an overall decline in industry production. The industry most recently reported a
decrease in HUD code production of 46% in April and 45% in May of 2009 compared to the same period
of 2008. Modular home production was similarly down during the period.
Gross sales to the manufactured housing market decreased 49% in the first six months of 2009
compared to the same period of 2008. This decrease resulted from an estimated 45% decrease in unit
sales combined with an estimated 4% decrease in selling prices. Industry production of HUD code
homes was off a reported 46% through May of 2009 compared to the same period of 2008. Modular home
production was similarly down during the period.
Value-Added and Commodity-Based Sales:
The following table presents, for the periods indicated, our percentage of value-added and
commodity-based sales to total sales.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 27, |
|
|
June 28, |
|
|
June 27, |
|
|
June 28, |
|
|
|
2009 |
|
|
2008 |
|
|
2009 |
|
|
2008 |
|
|
Value-Added |
|
|
61.2 |
% |
|
|
61.4 |
% |
|
|
61.0 |
% |
|
|
61.2 |
% |
Commodity-Based |
|
|
38.8 |
% |
|
|
38.6 |
% |
|
|
39.0 |
% |
|
|
38.8 |
% |
Value-added sales decreased 27% in the second quarter of 2009 compared to 2008, primarily due to
decreased sales of trusses, turn-key framing and installed sales, engineered wood products, fencing
and manufactured component lumber. Commodity-based sales decreased 27% comparing the second
quarter of 2009 with the same period of 2008, primarily due to decreased sales of non-manufactured
and treated lumber.
Value-added sales decreased 27% in the first six months of 2009 compared to 2008, primarily due to
decreased sales of trusses, turn-key framing and installed sales, engineered wood products and
manufactured component lumber. Commodity-based sales decreased 27% comparing the first six months
of 2009 with the same period of 2008, primarily due to decreased sales of non-manufactured lumber
and panels and treated lumber.
27
UNIVERSAL FOREST PRODUCTS, INC.
COST OF GOODS SOLD AND GROSS PROFIT
Our gross profit percentage increased to 16.0% from 12.0% comparing the second quarter of 2009 with
the same period of 2008. In addition, our gross profit dollars decreased by only 3% comparing the
second quarter of 2009 with the same period of 2008, which compares favorably with our 19% decrease
in unit sales. Our improved gross margin is primarily due to:
|
|
|
An improvement in material costs as a percentage of net sales as a result of better
inventory management to protect margins. |
|
|
|
An improvement in labor and plant overhead as a percentage of net sales due to plant
consolidation and right-sizing efforts previously taken. |
|
|
|
The lower level of the Lumber Market. |
Our gross profit percentage increased to 14.8% from 11.6% comparing the first six months of 2009
with the same period of 2008. In addition, our gross profit dollars decreased by approximately 7%
comparing the first six months of 2009 with the same period of 2008, which compares favorably with
our 20% decrease in unit sales. Our improved gross margin comparing these two periods was primarily
due to the factors mentioned in the paragraph above.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative (SG&A) expenses decreased by approximately $5.7 million, or
9.2%, in the second quarter of 2009 compared to the same period of 2008, while we reported a 19%
decrease in unit sales. Operations we closed decreased $4.1 million and existing operations
decreased $1.6 million. The decrease in SG&A expenses at our existing operations was primarily due
to a decline in wages and related costs due to a reduction in headcount and a decline in many other
account categories as a result of efforts to control costs. These decreases were partially offset
by an increase in accrued bonus and bad debt expense. Our SG&A expenses increased as a percentage
of sales primarily due to the lower level of the Lumber Market, accrued bonus, and bad debt
expense.
Selling, general and administrative (SG&A) expenses decreased by approximately $15.1 million, or
12.6%, in the first six months of 2009 compared to the same period of 2008, while we reported a 20%
decrease in unit sales. Operations we closed decreased $9.1 million and existing operations
decreased $6.0 million. The decrease in SG&A expenses at our existing operations was primarily due
to a decline in wages and related costs due to a reduction in headcount and a decline in many other
account categories as a result of efforts to control costs combined with several smaller decreases.
These decreases were partially offset by an increase in accrued bonus and bad debt expense. Our
SG&A expenses increased as a percentage of sales primarily due to the lower level of the Lumber
Market, accrued bonus, and bad debt expense.
28
UNIVERSAL FOREST PRODUCTS, INC.
NET (GAIN) LOSS ON DISPOSITION OF ASSETS AND OTHER IMPAIRMENT AND EXIT CHARGES
We incurred $0.4 million of charges in the second quarter of 2009 relating to asset impairments and
other costs associated with idled facilities and down-sizing efforts. These costs were offset by a
$1.1 million gain on the sale of certain real estate in 2009. We believe these actions will
improve our cost structure, profitability and cash flow in future reporting periods.
We incurred $1.6 million of charges in the first six months of 2009 relating to asset impairments
and other costs associated with idled facilities and down-sizing efforts. These costs were offset
by $3.5 million of gains on the sale of certain real estate in 2009.
INSURANCE PROCEEDS
In May, 2008 our plant in Windsor, Colorado was hit by a tornado. In accordance with Financial
Interpretation No. (FIN) 30, Accounting for Involuntary Conversions of Non-Monetary Assets to
Monetary Assets, we have written off the net book value of the destroyed inventory and property
totaling $0.7 million. The insured value of the property exceeded its net book value, which was recorded as a gain in 2008. In 2008, we collected $0.8 million of the insurance receivable and in 2009 we collected $1.0 million. As of June 27, 2009, there is no remaining insurance receivable.
INTEREST, NET
Net interest costs were lower in the second quarter and first six months of 2009 compared to the
same periods of 2008 due to lower debt balances combined with a decrease in short-term interest
rates upon which our variable rate debt is based. In addition, in June of 2009 we incurred $360,000
of expense related to a make-whole provision as a result of electing to pay off one of our senior
unsecured notes six months early. We will save approximately $420,000 in the last six months of
2009 because of this pre-payment.
INCOME TAXES
Effective tax rates differ from statutory federal income tax rates, primarily due to provisions for
state and local income taxes and permanent tax differences. Our effective tax rate decreased to
36.3% in the second quarter of 2009, compared to 38.0% in the second quarter of 2008 primarily due
to the research & development tax credit. In 2008, this credit did not receive legislative approval
until October.
Our effective tax rate increased to 35.5% in the first six months of 2009 from 34.6% in the same
period of 2008. The year to date rate comparison is impacted by the same factors discussed above
and a tax benefit recognized in the first quarter of 2008 as a result of foreclosing on a note
receivable from a joint venture.
OFF-BALANCE SHEET TRANSACTIONS
We have no significant off-balance sheet transactions other than operating leases.
29
UNIVERSAL FOREST PRODUCTS, INC.
LIQUIDITY AND CAPITAL RESOURCES
The table below presents, for the periods indicated, a summary of our cash flow statement (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
June 27, 2009 |
|
|
June 28, 2008 |
|
|
Cash from operating activities |
|
$ |
62,680 |
|
|
$ |
25,555 |
|
Cash from investing activities |
|
|
4,050 |
|
|
|
(7,626 |
) |
Cash from financing activities |
|
|
(47,434 |
) |
|
|
(29,051 |
) |
|
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
|
19,296 |
|
|
|
(11,122 |
) |
Cash and cash equivalents, beginning of period |
|
|
13,337 |
|
|
|
43,605 |
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
$ |
32,633 |
|
|
$ |
32,483 |
|
|
|
|
|
|
|
|
In general, we financed our growth in the past through a combination of operating cash flows, our
revolving credit facility, industrial development bonds (when circumstances permit), and issuance
of long-term notes payable at times when interest rates are favorable. We have not issued equity
to finance growth except in the case of a large acquisition. We manage our capital structure by
attempting to maintain a targeted ratio of debt to equity and debt to earnings before interest,
taxes, depreciation and amortization. We believe this is one of many important factors to
maintaining a strong credit profile, which in turn helps ensure timely access to capital when
needed. We are currently below our internal targets and plan to manage our capital structure
conservatively in light of current economic conditions.
Seasonality has a significant impact on our working capital from March to August which historically
resulted in negative or modest cash flows from operations in our first and second quarters.
Conversely, we experience a substantial decrease in working capital from September to February
which results in significant cash flow from operations in our third and fourth quarters. For
comparative purposes, we have included the June 28, 2008 balances in the accompanying unaudited
consolidated condensed balance sheets.
Due to the seasonality of our business and the effects of the Lumber Market, we believe our cash
cycle (days of sales outstanding plus days supply of inventory less days payables outstanding) is a
good indicator of our working capital management. Our cash cycle (excluding the impact of our sale
of receivables program) increased to 47 days in the first six months of 2009 from 46 days in the
first six months of 2008, due to a 1 day increase in our days supply of inventory. The increase in
our days supply of inventory was primarily due to a combination of lower than planned sales early
in the year and inventory positions we have taken to protect margins on future business.
30
UNIVERSAL FOREST PRODUCTS, INC.
Cash provided by operating activities was approximately $63 million in the first six months of
2009. Our net earnings of $14.9 million included $20.1 million of non-cash expenses and a $27.7
million decrease in working capital. Working capital decreased primarily due to reductions in
inventory as we reached our primary selling season, the impact of a lower Lumber Market on our
inventory levels, and an increase in accounts payable as purchases and volumes increase. These
reductions are offset by an increase in accounts receivable due to higher sales volumes. In
addition, through June of 2008, there was approximately $23 million of positive cash flow included
in operating activities related to our sale of receivables program. Specifically, at the end of
December 2007 and June 2008 we had approximately $27 million and $50 million, respectively, of
receivables sold and outstanding under this program. This program was terminated in September
2008.
We have made the decision to limit our investing activities in 2009 and make debt repayment our
first priority for use of our operating cash flows. As a result, we have curtailed our capital
expenditures and currently plan to spend approximately $13 million in 2009, which includes
outstanding purchase commitments on existing capital projects totaling approximately $1.2 million
on June 27, 2009. We intend to fund capital expenditures and purchase commitments through our
operating cash flows. In addition, we sold certain real estate, for which we had no planned future
use, for approximately $10 million.
On June 27, 2009, we had no outstanding balance on our $300 million revolving credit facility,
which matures in February of 2012. The revolving credit facility also supports letters of credit
totaling approximately $29.7 million on June 27, 2009. Financial covenants on the unsecured
revolving credit facility and unsecured notes include a minimum net worth requirement, minimum
interest and fixed charge coverage tests, and a maximum leverage ratio. The agreements also
restrict the amount of additional indebtedness we may incur and the amount of assets which may be
sold. We were within all of our lending requirements on June 27, 2009.
Our Series 2002-A Senior Notes totaling $15.0 million, due on December 18, 2009, were pre-paid
during the second quarter of 2009.
ENVIRONMENTAL CONSIDERATIONS AND REGULATIONS
See Notes to Consolidated Condensed Financial Statements, Note G, Commitments, Contingencies, and
Guarantees.
CRITICAL ACCOUNTING POLICIES
In preparing our consolidated financial statements, we follow accounting principles generally
accepted in the United States. These principles require us to make certain estimates and apply
judgments that affect our financial position and results of operations. We continually review our
accounting policies and financial information disclosures. There have been no material changes in
our policies or estimates since December 27, 2008.
31
UNIVERSAL FOREST PRODUCTS, INC.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
We are exposed to market risks related to fluctuations in interest rates on our variable rate debt,
which consists of a revolving credit facility and industrial development revenue bonds. We do not
currently use interest rate swaps, futures contracts or options on futures, or other types of
derivative financial instruments to mitigate this risk.
For fixed rate debt, changes in interest rates generally affect the fair market value, but not
earnings or cash flows. Conversely, for variable rate debt, changes in interest rates generally do
not influence fair market value, but do affect future earnings and cash flows. We do not have an
obligation to prepay fixed rate debt prior to maturity, and as a result, interest rate risk and
changes in fair market value should not have a significant impact on such debt until we would be
required to refinance it.
Item 4. Controls and Procedures.
(a) |
|
Evaluation of Disclosure Controls and Procedures. With the participation of
management, our chief executive officer and chief financial officer, after evaluating the
effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a
15e and 15d 15e) as of the quarter ended June 27, 2009 (the Evaluation Date), have
concluded that, as of such date, our disclosure controls and procedures were effective. |
(b) |
|
Changes in Internal Controls. During the quarter ended June 27, 2009, there were no
changes in our internal control over financial reporting that materially affected, or is
reasonably likely to materially affect, our internal control over financial reporting. |
32
UNIVERSAL FOREST PRODUCTS, INC.
PART II. OTHER INFORMATION
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
(c) |
|
Issuer purchases of equity securities. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Month |
|
(a) |
|
|
(b) |
|
|
(c) |
|
|
(d) |
|
|
March 29, 2009 May 2, 2009(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,223,323 |
|
May 3 30, 2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,223,323 |
|
May 31, 2009 June 27, 2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,223,323 |
|
|
|
|
(a) |
|
Total number of shares purchased. |
|
(b) |
|
Average price paid per share. |
|
(c) |
|
Total number of shares purchased as part of publicly announced plans or
programs. |
|
(d) |
|
Maximum number of shares that may yet be purchased under the plans or programs. |
|
(1) |
|
On November 14, 2001, the Board of Directors approved a share repurchase
program (which succeeded a previous program) allowing us to repurchase up to 2.5
million shares of our common stock. As of June 27, 2009, cumulative total authorized
shares available for repurchase is 1.2 million shares. |
33
UNIVERSAL FOREST PRODUCTS, INC.
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The following matters were voted upon at our Annual Meeting of Shareholders on April 15, 2009:
(a) |
|
Election of three Directors for three year terms expiring in 2012: |
|
|
|
|
|
|
|
|
|
|
|
For |
|
|
Withheld |
|
Dan M. Dutton |
|
|
17,864,305 |
|
|
|
476,081 |
|
William R. Payne |
|
|
17,465,166 |
|
|
|
875,221 |
|
Louis A. Smith |
|
|
17,205,900 |
|
|
|
1,134,486 |
|
Other Directors whose terms of office continued after the meeting are as follows:
|
William G. Currie |
John M. Engler |
John W. Garside |
Michael B. Glenn |
Gary F. Goode |
Mark A. Murray |
(b) |
|
Amendment to our 1999 Long Term Stock Incentive Plan: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For |
|
|
Withheld |
|
|
Abstain |
|
|
|
|
11,183,701 |
|
|
|
5,775,517 |
|
|
|
19,546 |
|
(c) |
|
Ratification of the appointment of Ernst & Young LLP as independent public accountants for
fiscal 2009: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For |
|
|
Withheld |
|
|
Abstain |
|
|
|
|
18,033,868 |
|
|
|
300,170 |
|
|
|
6,348 |
|
Item 5. Other Information.
In the second quarter of 2009, the Audit Committee approved $2,000 of non-audit services to be
provided by our independent auditors, Ernst & Young LLP, for 2009.
34
UNIVERSAL FOREST PRODUCTS, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits.
The following exhibits (listed by number corresponding to the Exhibit Table as Item 601 in
Regulation S-K) are filed with this report:
10 |
|
Material Contracts. |
|
|
|
*(a)(9) Amended and restated Consulting and Non-Compete Agreement with William G.
Currie, dated Ju1y 10, 2009. |
|
(a) |
|
Certificate of the Chief Executive Officer of Universal Forest Products, Inc.,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
|
|
(b) |
|
Certificate of the Chief Financial Officer of Universal Forest Products, Inc.,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
|
(a) |
|
Certificate of the Chief Executive Officer of Universal Forest Products, Inc.,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
|
|
(b) |
|
Certificate of the Chief Financial Officer of Universal Forest Products, Inc.,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
|
|
|
* |
|
Indicates a compensatory arrangement. |
35
UNIVERSAL FOREST PRODUCTS, INC.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
|
|
|
UNIVERSAL FOREST PRODUCTS, INC.
|
|
Date: July 20, 2009 |
By: |
/s/ Michael B. Glenn
|
|
|
|
Michael B. Glenn |
|
|
|
Its: Chief Executive Officer |
|
|
|
|
|
Date: July 20, 2009 |
By: |
/s/ Michael R. Cole
|
|
|
|
Michael R. Cole |
|
|
|
Its: Chief Financial Officer |
|
36
EXHIBIT INDEX
|
|
|
|
|
Exhibit No. |
|
Description |
|
|
|
|
|
|
10 |
|
|
Material Contracts. |
|
|
|
|
|
|
|
|
|
*(a)(9) Amended and restated Consulting and Non-Compete Agreement with William G.
Currie, dated July 10, 2009. |
|
|
|
|
|
|
31 |
|
|
Certifications. |
|
(a) |
|
Certificate of the Chief Executive Officer of Universal
Forest Products, Inc., pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. 1350). |
|
|
(b) |
|
Certificate of the Chief Financial Officer of Universal
Forest Products, Inc., pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. 1350). |
|
(a) |
|
Certificate of the Chief Executive Officer of Universal
Forest Products, Inc., pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. 1350). |
|
|
(b) |
|
Certificate of the Chief Financial Officer of Universal
Forest Products, Inc., pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. 1350). |
|
|
|
* |
|
Indicates a compensatory arrangement. |