Masco's big-ticket business was hit hard in 2010
For Masco Corp., 2010 was a tale of two very different halves, according to CEO Tim Wadhams.
The diverse home product company saw sales rise in the first half. Then, as the new home buyer tax credit expired and competition stiffened as costs increased, sales went south. "Our installation and cabinet businesses, which are tied to new-home construction and big-ticket repair and remodel activity, were particularly hard hit," he said.
The company finished the year ended Dec. 31 with sales of $7.592 billion, down 2.6% from the previous year. For the full year, the company's net loss was $1.043 billion, compared with a loss of $183 million in 2010.
In the fourth quarter, Masco's sales were $1.735 billion, down 8.6%. The company's net loss was $1.034 billion, compared with a loss of of $185 million in the same quarter the prior year.
"Industry conditions in 2010 continued to be challenging, and it was a tough year for Masco," Wadhams said. "We are encouraged that in a difficult environment, our full-year adjusted gross margins -- 26.4% -- and operating profit -- 5.7% -- were essentially flat with 2009, even though sales were down 3%."
Among the accomplishments he pointed to in 2010 were the introduction of Delta Touch 20 faucets, Arrow RED line of staplers and Kilz Pro-X paint. The company also ended the year with $1.7 billion of cash, providing enhanced financial flexibility.
Big-ticket sales have been slow, Wadhams added. "We expect a challenging business environment, particularly in the first half of 2011; we expect the second half of 2011 to be stronger."
Headquartered in Taylor, Mich., Masco is a major manufacturer of home improvement and building products -- including KraftMaid cabinets, Delta faucets and Behr paint.