Second Quarter Down, USG Reports
The corporation's consolidated second quarter 2008 results included restructuring charges totaling $21 million ($13 million after-tax, or $0.13 per diluted share) associated with salaried workforce reductions, the closing of distribution locations and expenses related to the shutdown of several manufacturing lines. The corporation's consolidated second quarter 2007 results included restructuring charges of $15 million ($9 million after-tax, or $0.09 per diluted share).
“The steep decline in the U.S. housing market, combined with unprecedented increases in the cost of key raw materials and energy, resulted in losses in our core wallboard business,” said William C. Foote, USG chairman and CEO. “Our other businesses are performing reasonably well, despite their own challenging market conditions.
“Our people continue to effectively manage the factors we can control,” added Foote. “Plant operating efficiencies have improved since we closed or curtailed older, higher-cost capacity, and our safety performance continues to be outstanding. Overhead is running well below levels at the start of 2007, and operating profitability has improved since the first quarter of 2008. We have also achieved modest price improvement in some product lines and will seek further increases to help offset higher operating costs. Finally, we are keenly focused on maintaining the financial flexibility necessary during this difficult period.”
Foote concluded that over the longer term, the company believes the actions USG takes during the market downturn will position the company better well housing starts rebound.
For the first half of 2008, the corporation reported net sales of $2.4 billion and a net loss of $85 million, or $0.85 per diluted share based on 99.1 million average diluted shares outstanding. For the first half of 2007, net sales were $2.7 billion and net earnings were $97 million, or $1.01 per diluted share based on 95.5 million average diluted shares outstanding. The corporation's consolidated results for the first six months of 2008 included restructuring charges of $25 million ($16 million after-tax, or $0.16 per diluted share). The corporation's consolidated results for the first six months of 2007 included restructuring charges of $15 million ($9 million after-tax, or $0.10 per diluted share).