Trex (TREX) Tops Q1 EPS by 4c, Revenues Bat; Offers 2Q Revenues Outlook

Trex (NYSE: TREX) reported Q1 EPS of $0.42, $0.04 better than the analyst estimate of $0.38. Revenue for the quarter came in at $246 million versus the consensus estimate of $237.82 million.

“Sustained demand for Trex Residential products and accelerated market share gains from wood drove first quarter sales growth, laying the foundation for another year of strong double-digit revenue growth in 2021. At the same time, capacity expansion at our new state-of-the-art manufacturing facility in Virginia is coming on faster than originally anticipated. We now expect all lines in our new plant to be fully operational by the end of May, thirty days ahead of schedule. When completed, our capacity expansion investment will provide approximately 70% more capacity when compared to 2019 volume levels and will give us an important competitive advantage in today’s dynamic composite decking marketplace. The additional capacity further reinforces our position as the industry leader and most efficient manufacturer of high-performance, wood-alternative decking and railing,” said Bryan Fairbanks, President and CEO.

GUIDANCE:

Trex sees Q2 2021 revenue of $295-305 million, versus the consensus of $278.06 million.

“The dedication and collaboration of the Trex organization and our extended family of retailers, dealers, contractors and distributors has been the driving force in enabling us to report 25% higher residential sales while undertaking a transformational capacity expansion program and managing through the pandemic. We appreciate their efforts and the industry recognitions we regularly receive that honor Trex products for their performance, appeal and sustainability.

“As the recognized leader in product performance, aesthetics, quality and the use of 95% recycled content, Trex experienced robust demand, achieving broad-based growth across all of our residential product lines. In April, traffic to our Trex.com and Decks.com websites reached the same high levels that we usually see in June and July, our seasonally strongest months of the year, underscoring our brand leadership in the outdoor living category and the accelerated pace at which we are taking share from the traditional wood market.

“For the second quarter of 2021, we expect consolidated net sales to range from $295 million to $305 million, representing 36% year-over-year growth at the midpoint of the range. We also are reaffirming our guidance for full year 2021 incremental EBITDA margin of between 35% and 40%. We recently announced price increases on most products that will take effect August 2021. This mid-year pricing action was precipitated by increased inflation across many key raw materials and transportation,” Mr. Fairbanks concluded.

For earnings history and earnings-related data on Trex (TREX) click here.

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