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Friday, April 29, 2011

Wells Fargo Weekly Economic Forecast

U.S.
- Real GDP grew 1.8 percent year-over-year in the first quarter, which Federal Reserve Chairman Ben Bernanke stated was likely due to “transitory” factors such as lower defense spending, weaker exports, and weather.
- The Fed lowered its economic growth projections for 2011 to a range of 3.1 to 3.3 percent, down from 3.4 to 3.9 percent, and confirmed that QE2 would end in June as planned.
. Our economic growth forecasts for the year have been consistently below consensus expectations, and we continue to expect real GDP to grow 2.4 percent in 2011 and 2.8 percent in 2012.
. We also believe that inflation will run slightly higher, with overall CPI rising 3.3 percent this year and core CPI increasing 1.4 percent.
- Consumer spending growth declined during the first quarter to a 2.7 percent annual rate, as households continue to cope with rising food and energy prices.
- Initial jobless claims rose to 429,000 for the week ending April 23, the highest level since January and the third consecutive weekly increase, while the four-week moving average increased to 406,500.

International
- Real GDP in the United Kingdom grew 1.8 percent year-over-year during the first quarter, and remains four percent below its pre-recession peak.
. The services industry expanded 0.9 percent during the quarter, but real retail spending was essentially flat due to contractions in real personal disposable income.
- Future growth in the United Kingdom will likely be limited by fiscal tightening, as the government plans to cut over £30 billion from this year’s budget, with further cuts planned over the next few years.
- The Consumer Price Index for the U.K. indicated prices rose 4.1 percent year-over-year in March, while payrolls are up just one percent from 2009 lows.
. Although the inflation rate is well above the 2.0 percent rate mandated by the Monetary Policy Committee, we believe interest rates will remain unchanged over the coming months.

Global Gypsum Report for 2011

Events, Trends, and Issues:

U.S. gypsum production declined as the housing and construction markets continued to falter, with apparent consumption decreasing by about 8% compared with that of 2009. China, the world’s leading producer, produced approximately five times the amount produced in the United States, the world’s fourth ranked producer. Iran ranked second in world production and supplied much of the gypsum needed for construction in the Middle East. Spain, the leading European producer, ranked third in the world, and supplied both crude gypsum and gypsum products to much of Western Europe. An increased use of wallboard in Asia, coupled with new gypsum product plants, spurred increased production in that region. As more cultures recognize the economy and efficiency of wallboard use, worldwide production of gypsum is expected to increase.

Demand for gypsum depends principally on the strength of the construction industry—particularly in the United States, where about 95% of the gypsum consumed is used for building plasters, the manufacture of portland cement, and wallboard products. The construction of wallboard plants designed to use synthetic gypsum as feedstock will result in less use of natural gypsum as these new plants become operational. Imports decreased by approximately 21% compared with those of 2009. Exports, although very low compared with imports, more than doubled.

Wednesday, April 27, 2011

Owens Corning Reports 1Q11 Earnings

First Quarter in Line with Company's Expectations;

On Target to Deliver $475 Million in Adjusted EBIT in 2011

Apr 27, 2011
7:30am
TOLEDO, Ohio, April 27, 2011 /PRNewswire/ --
  • Grew EBIT in Composites by 55% Versus the First Quarter of 2010
  • Benefitted from a Recovery in Roofing Volumes that Supports Full-Year Outlook
  • Challenged by First-Quarter Insulation Market Conditions; Taking Actions to Support Profitable Second Half in Insulation
  • Project Adjusted EPS Growth of More Than 30% in 2011

Owens Corning (NYSE: OC) today reported consolidated net sales decreased 2 percent to $1.24 billion in the first quarter of 2011, compared with $1.27 billion in the first quarter of 2010.

First-quarter 2011 net earnings were $24 million, or $0.19 per diluted share, compared with net earnings of $48 million, or $0.38 per diluted share, in the first quarter of 2010.  First-quarter adjusted earnings, when adjusted to the company's expected full-year effective tax rate of 28 percent, were $25 million, or $0.20 per diluted share, compared with $53 million, or $0.42 per diluted share, in the first quarter of 2010.  (See Tables 1, 2 and 3 for a discussion and reconciliation of these items.)

"Owens Corning delivered profit in line with our expectations for the first quarter driven by continued strong performance in the Composites and Roofing businesses," said Chairman and Chief Executive Officer Mike Thaman.  "We remain confident in our guidance of $475 million in adjusted EBIT for 2011.

"During the quarter we made operating investments to expand our Composites capacity and convert Insulation facilities to produce our new EcoTouch™ insulation," Thaman added.  "We expect that these investments -- combined with improving economic conditions and our recent pricing actions -- will improve profitability throughout the balance of the year."

Consolidated First-Quarter 2011 Results
  • Owens Corning's primary safety metric improved by approximately 30 percent over the company's full-year 2010 performance.
  • First-quarter earnings before interest and taxes (EBIT) was $61 million in 2011 compared with $83 million in the first quarter of 2010.  In 2010, the company had certain items that management believes were not the result of current operations.  After adjusting for these items, Owens Corning's first-quarter 2010 adjusted EBIT was $97 million.  (See Table 2 for a reconciliation of these items.)
  • Gross margin as a percentage of net sales was 16 percent in the first quarter of 2011 compared with 19 percent in 2010

Building Materials
NET SALES
Net sales in the Building Materials segment were lower in the first quarter of 2011 compared with the same period in 2010.  Most of this decrease was related to lower sales volumes within the Roofing business.  Sales were also negatively impacted by the fourth-quarter 2010 divestiture of the North American Masonry Products business and lower sales in the Insulation business.

In the Roofing business, lower shingle volumes accounted for approximately three-fourths of the decrease in net sales during the quarter.  First-quarter 2011 shingle volumes were lower than the first quarter of 2010 because of heavier customer restocking activity in the first quarter of 2010.  The remaining decrease in net sales between the first quarter of 2011 and the first quarter of 2010 was due to lower selling prices, which more than offset favorable product mix.

In the Insulation business, net sales in the first quarter of 2011 were lower than the same period in 2010 due to lower sales volumes that were partially offset by higher selling prices.  Lower sales volumes continue to persist given the current state of the U.S. housing market.  Pricing actions taken in the United States in the second half of 2010 resulted in higher selling prices in the first quarter 2011 as compared to the first quarter of 2010.

EBIT
EBIT for the Building Materials segment decreased in the first quarter of 2011 compared with the same period in 2010 primarily because of lower EBIT in the Roofing business.

In the Roofing business, approximately three-fourths of the decrease in EBIT for the first quarter of 2011 compared to the first quarter of 2010 was due to lower unit margins.  Lower selling prices and raw material inflation including asphalt, negatively impacted first-quarter 2011 unit margins compared to the first quarter of 2010.  The remaining decrease in EBIT was due to lower shingle sales volumes as described above.

In the Insulation business, EBIT was down for the first quarter of 2011 compared with the same period in 2010.  Increases in United States selling prices were more than offset by the impact of lower sales volumes and costs associated with the launch of EcoTouch™ during the first quarter.

Federal Reserve: Bernanke: Fed Sees Slower Growth, Uptick in Inflation - CNBC

Federal Reserve: Bernanke: Fed Sees Slower Growth, Uptick in Inflation - CNBC

New Voluntary Specification Rating for Tornadoes

The American Architectural Manufacturers Association released a new voluntary specification for rating and testing products that may be exposed to tornadoes. The specification is entitled “Voluntary Specifications for Tornado Hazard Mitigating Fenestration Products.”

Tuesday, April 26, 2011

View homes picked for AIA tour

The Triangle chapter of the American Institute of Architects has selected six homes that will be featured during its 2011 Residential Architecture Tour in October.

Homes on the tour will include:
• Abbey House by Weinstein Friedlein Architects, PA at 735 Gimghoul Road in Chapel Hill.
• Tise Residence by Tise Kiester Architects at 914 Lystra Lane in Chapel Hill.
• The Goodall Addition by Tina Govan, AIA, at 513 Holden St. in Raleigh.
• Davis Residence by Bizios Architect at 3105 Janice Road in Raleigh.
• Stevenson Thrower Residence by Michael Stevenson, AIA, at 210 E. Forest Drive in Raleigh.
• Graham St. House by Alphin Design Build at 816 Graham St. in Raleigh.





Friday, April 22, 2011

Wells Fargo Weekly Economic Forecast


U.S.
-     The Dow Jones Industrial Average rose to its highest level in three years, as upbeat earnings announcements overshadowed somewhat lackluster economic data released during the week.
-     Sales of existing homes rose 3.7 percent in March to a 5.1 million unit pace, but distressed transactions accounted for 40 percent of overall sales.
-     With foreclosures and short sales accounting for an increasing share of sales, home prices are expected to continue to decline over the next six to eight months, eventually bringing the peak-to-trough decline in the median price and the S&P/Case-Shiller Home Price Index to around 38 percent.
.     New homes typically sell for about 12 percent above existing homes, but that premium is closer to 30 percent today, which has placed a considerable drag on housing construction.
-     Housing starts rose 7.2 percent in March to a 549,000 unit pace, but much of the increase likely reflects payback from the pullback in February caused by harsh weather conditions.
.     Despite many challenges in the housing market, we expect starts to increase to a 620,000 unit pace in 2011.


International
-     Greek government debt is under intense selling pressure of late, as investors see an increased probability of default over the next five years.
.     Greek 10-year government bonds were recently yielding 14.719 percent, approximately 11.46 percentage points above comparable German Bonds, while Greek 2-year notes were yielding 22.2 percent, a full 20.45 percentage points above the German 2-year note.
.     According to Bloomberg London 5-year credit default swaps, the cost of insuring Greek sovereign bonds jumped to 1,422 basis points, signaling more than a 68 percent chance of Greek debt defaulting within five years.
-     The German Ifo survey measuring business sentiment slipped to 110.4 in April from 111.1 in March, while the future expectations balance fell to 104.7 from 106.5 during the previous month.
-     The European Central Bank’s recent decision to raise its benchmark interest rate has caused the euro to strengthen over the past month, putting more competitive price and margin pressures on manufacturing exporters.
-     Japan released March’s trade balance report which revealed a 2.2 percent year-over-year contraction in Japanese exports.
.     From February, Japan’s exports fell 7.7 percent as the earthquake’s impact surfaced, while imports surged at an 11.9 percent year-over-year pace.

Thursday, April 21, 2011

Delta Gypsum stocking SALIX -- LIVE

Stocking SALIX




USG Reports 1Q11 Earnings

First Quarter 2011 vs. First Quarter 2010
Consolidated Business Highlights
  • Sales increased 1%
  • Operating loss of $58 million compared to $82 million
  • Adjusted operating loss of $49 million compared to $70 million
Business Unit Highlights
  • U.S. Gypsum wallboard shipments totaled 992 MMSF vs. 1.15 BSF
  • Worldwide Ceilings operating profit increased $8 million
  • L&W same-store net sales decreased 1%
USG Corporation (NYSE:USG), a leading building products company, today reported first quarter 2011 net sales of $721 million, an operating loss of $58 million and a net loss of $105 million, or $1.01 per diluted share based on 103 million average diluted shares outstanding. In last year’s first quarter, the operating loss was $82 million and the net loss was $110 million, or $1.10 per diluted share based on 99.4 million average diluted shares.

“As expected, we experienced generally weak demand in our domestic markets during the quarter,” said James Metcalf, President and CEO. “Accordingly, we continue to focus on our operating initiatives to drive improvements in our results.

“We are seeing signs of stabilization in U.S. commercial construction and positive trends in the repair and remodel segment, but the new residential construction market remains weak,” Metcalf continued. “The long term fundamentals that drive our business remain very solid. As demand improves we will benefit from the operating leverage inherent in both our manufacturing and distribution businesses.”

The corporation’s adjusted operating loss was $49 million in the first quarter of 2011, which compares to an adjusted operating loss of $70 million in the first quarter of 2010. The adjusted operating loss for the first quarter of 2011 excludes $9 million of restructuring and long-lived asset impairment charges, while the adjusted operating loss for the first quarter of 2010 excludes $12 million of restructuring and long-lived asset impairment charges.

Wednesday, April 20, 2011

Temple-Inland Reports First Quarter 2011 Results

Temple-Inland Inc. (NYSE:TIN - News) today reported first quarter 2011 net income of $16 million, or $0.15 per diluted share, compared with fourth quarter 2010 net income of $27 million, or $0.24 per diluted share, and a first quarter 2010 net loss of $4 million, or $0.04 per share.

First quarter 2011 net income excluding special items was $24 million, or $0.22 per diluted share, compared with fourth quarter 2010 net income excluding special items of $35 million, or $0.31 per diluted share, and first quarter 2010 net loss excluding special items of $1 million, or $0.01 per share.

Doyle R. Simons, chairman and chief executive officer of Temple-Inland Inc., said, “Our employees executed well in the quarter and delivered strong operating results, despite challenging weather conditions and rising input costs.

“In Corrugated Packaging, first quarter operating income was $98 million, and our return on investment was 18.3%. Our mills performed well in the quarter. We continue to be pleased with our progress on Box Plant Transformation II.

“In Building Products, our operating results improved compared with fourth quarter 2010 and first quarter 2010 despite continued weakness in housing markets. We generated $4 million of EBITDA in the quarter.
“Looking forward, in Corrugated Packaging, we are positioned to continue to generate returns well in excess of our cost of capital for the balance of the year. In Building Products, we remain committed to generating cash and returning to profitability as housing markets recover.”

Building Products operating results improved in first quarter 2011 compared with fourth quarter 2010 due to higher lumber prices and seasonally higher volumes for all products. Operating results improved in first quarter 2011 compared with first quarter 2010 as higher volumes and lower unit costs more than offset lower lumber prices. 

Wednesday, April 13, 2011

ClarkDietrich Building Systems to voluntarily resign from SSMA

The new company was afforded the opportunity to transfer its membership to the new enterprise, but they refused.  As a result, Clark and Dietrich, and ClarkDietrich are no longer certified code compliant by the SSMA.

Wednesday, April 6, 2011

Lafarge Protecta HIR

Lafarge Protecta HIR 300 Type X with Mold Defense is a High Impact Resistant drywall manufactured with over 90% recycled content that consists of a fiber glass-enhanced, non-combustible, high-density, synthetic gypsum core with reinforced facers providing a greater resistance to penetration for interior walls and ceilings