Masco Corporation (NYSE:MAS) posted operating profit and net sales growth in 1Q2015 with all segments recording increased sales. The adjusted operating profit margin jumped 9%, highlighting the company’s focused commitment and execution to cost control.
The expert view
Keith Allman, the CEO and President of Masco, said that the momentum company created in the past few several years moved into 1Q as there was top- and bottom- line growth with margin expansion. The leading brands and innovation resulted in strong consumer demand in all the segments. In local currency, both Hansgrohe and Delta Faucet recorded their best sales quarters ever.
Masco’s focus on new products and pro painter boosted sales in its Decorative Architectural division. The specialty division commitment to innovation strengthened results. Coming to installation division, it is gaining from strategic diversification into housing and commercial construction. In the cabinets and related products unit, the measures to improve execution are yielding results. There was growth in sales to builders and home centers improving profitability.
The net sales surged 3% to $2 billion from 1Q2014. The international sales declined 8% in U.S. dollars but jumped 10% in local currency. The gross margins came at 28.2% compared to 28% in 1Q2014. The operating margins jumped to 9% from 8% in the same quarter a year ago. The liquidity at the end of first quarter 2015 stood around $1.8 billion. Masco reported repurchase of almost 4 million shares during the quarter.
Allman further said that the management is delighted with a strong start to the year. The businesses are doing well and performing as planned. The repair and remodel business is expanding with rising demand for the products. The focus will remain on increasing shareholder value and rewarding cash to shareholders. Almost $135 million were returned to shareholders in 1Q through share repurchases and dividends.