Owens Corning achieved record revenues of US $ 7.1 billion in 2018; achieved net profit of US $ 545 million, and adjusted earnings before interest and taxes reached a record US $ 861 million.
Strong product portfolio achieves double-digit EBIT margins in all three areas
· EBIT of the insulation materials business increased by 64% to US $ 290 million and revenue increased by 36%
· EBIT of the roofing materials business was $ 434 million and revenue was $ 2.5 billion
· EBIT of composite materials business was $ 251 million, with a profit margin of 12%
Toledo, Ohio (BUSINESS WIRE): Owens Corning (NYSE: OC) announced on February 26 that consolidated net sales for the fourth quarter of 2018 were $ 1.7 billion, compared to 2017 The same period in the fourth quarter was $ 1.6 billion, an increase of 7%. For the full year of 2018, consolidated net sales were US $ 7.1 billion, an increase of 11% compared to 2017's US $ 6.4 billion.
"Owens Corning's revenue and adjusted EBIT profits this year have reached new highs, and the EBIT margins of the three major businesses have reached double digits." Mike Owens Corning Chairman and CEO Thaman said, "Today, Owens Corning is more resilient and diversified, and is better able to generate attractive returns for investors throughout the cycle.
Highlights
Owens Corning maintained a high level of safety performance in 2018, with a recordable accident rate of 0.52, which is comparable to last year.
The Board elects the current President and Chief Operating Officer Brian Chambers to replace Mike Thaman as Chief Executive Officer, effective April 18, 2019. Thaman, who has been chairman since 2002 and CEO since 2007, has announced his retirement and will continue to chair the board.
2019 Outlook
The company expects that its operating environment is in line with the general expectations of global industrial production growth, US housing starts, and global commercial and industrial construction growth.
In terms of insulation materials business, the company expects the macroeconomic prospects of North American residential glass wool insulation materials business to be flat. In terms of technical insulation materials and other construction insulation materials businesses, the company expects profit growth to be driven by improved operating performance and growth in the global construction and industrial insulation market.
In terms of composite materials business, the company expects that the growth of the glass fiber market is consistent with the growth of global industrial production, and the global economic environment is more uncertain. The company expects sales growth and improved operating performance to be offset by inflation.
In terms of roofing materials business, the company expects that the US asphalt tile market demand is relatively flat, and industry shipments are slightly lower than last year. Owens Corning expects the company's geographic distribution to be more favorable than last year, with a higher proportion of shipments. Entering 2019, the business will continue to maintain strong performance.
As the company's net tax operating loss in the United States and carry-over of overseas tax credits are carried forward, the actual tax rate is expected to be 26% to 28%, and the adjusted cash tax rate for pre-tax profits is 10% to 12%.
The company expects that the company's general expenses will be between $ 140 million and $ 150 million. Total additional capital is expected to be approximately US $ 500 million, with greater emphasis on productivity. Interest expenses are expected to be approximately $ 130 million.
The company expects that adjusted profits will be strongly converted into free cash flow. The company plans to prioritize free cash flow for ongoing dividends and plans to reduce term loans related to the acquisition of Finnish Paloco. Additional free cash flow can be used for share buybacks under the company's existing mandate.