Owens Corning Shares Gain On Strong Q2 Results

Owens Corning Shares Gain On Strong Q2 Results
  • Owens Corning OC reported second-quarter sales growth of 37.8% year-over-year to $2.24 billion, beating the consensus estimate of $2 billion.
  • Sales by segments: Composites $583 million (+46.5% Y/Y), Insulation $806 million (+35% Y/Y), and Roofing $917 million (+35% Y/Y).
  • Adjusted EPS improved to $2.60 from $0.91 in 2Q20, beating consensus estimates of $2.13.
  • The gross margin expanded by 650 bps to 27.6%. The operating income increased by 153% Y/Y to $425 million, and the margin expanded by 865 bps to 18.9%.
  • Owens Corning generated cash from operating activities year-to-date of $702 million, compared to $229 million a year ago. Free cash flow of $525 million.
  • Adjusted EBIT margin expanded by 795 bps to 18.2%.
  • The company finished the quarter with $2 billion of available liquidity, including $888 million in cash and cash equivalents.
  • FY21 Outlook: The company expects the U.S. residential housing market to remain robust in the near term.
  • The company expects general corporate expenses to be $150 million to $155 million, compared to the prior view of $135 million and $145 million. It expects capital additions of $460 million.
  • Depreciation and amortization are now estimated to be roughly $500 million, up from $480 million. Interest expense is estimated to be $120 million to $130 million.
  • Price action: OC shares trading higher by 1.93% at $94.00 in the premarket session on the last check Wednesday.

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