Owens Corning (OC) has reported a 333.33 percent jump in profit for the quarter ended Jun. 30, 2015. The company has earned $91 million, or $0.77 a share in the quarter, compared with $21 million, or $0.18 a share for the same period last year. Revenue during the quarter grew 4.35 percent to $1,414 million from $1,355 million in the previous year period. Gross margin for the quarter expanded 348 basis points over the previous year period to 21.78 percent. Total expenses were 88.97 percent of quarterly revenues, down from 94.61 percent for the same period last year. This has led to an improvement of 565 basis points in operating margin to 11.03 percent.
Operating income for the quarter was $156 million, compared with $73 million in the previous year period.
'Owens Corning is pleased with its second-quarter performance as all three businesses made substantial contributions to earnings,' said Mike Thaman, chairman and chief executive officer. 'Composites had an outstanding quarter driven by continued strong commercial and operational execution. Roofing experienced strong shipments and improving margins throughout the quarter. Insulation continues to make progress with growth expected to accelerate in the second half on the recent improvement in U.S. housing starts.'
Operating cash flow turns positive
Owens Corning has generated cash of $80 million from operating activities during the first half as against cash outgo of $117 million in the last year period. The company has spent $149 million cash to meet investing activities during the first six months as against cash outgo of $63 million in the last year period.
Cash flow from financing activities was $83 million for the first six months, down 59.71 percent or $123 million, when compared with the last year period. It has made net debt repayment of $158 million. It has spent net of $47 million on repurchase of common stocks.
Cash and cash equivalents stood at $80 million as on Jun. 30, 2015, down 1.23 percent or $1 million from $81 million on Jun. 30, 2014.
Working capital declines
Owens Corning has witnessed a decline in the working capital over the last year. It stood at $1,043 million as at Jun. 30, 2015, down 9.70 percent or $112 million from $1,155 million on Jun. 30, 2014. Current ratio was at 2.11 as on Jun. 30, 2015, down from 2.28 on Jun. 30, 2014.
Days sales outstanding went down to 27 days for the quarter compared with 60 days for the same period last year.
Days inventory outstanding has decreased to 32 days for the quarter compared with 74 days for the previous year period.
Debt comes down
Owens Corning has recorded a decline in total debt over the last one year. It stood at $2,177 million as on Jun. 30, 2015, down 5.02 percent or $115 million from $2,292 million on Jun. 30, 2014. Total debt was 28.35 percent of total assets as on Jun. 30, 2015, compared with 29.40 percent on Jun. 30, 2014. Debt to equity ratio was at 0.58 as on Jun. 30, 2015, up from 7.61 as on Jun. 30, 2014. Interest coverage ratio improved to 6 for the quarter from 2.35 for the same period last year.
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