Masco Corporation has reported ‘strong’ net sales and operating profit growth in the third quarter of 2016.
In the three months to September 30 gross profit increased to $614 million (£502m), compared with the same period last year ($589m). In the nine months to the end of September profits increased to $1.9 billion (£1.5bn) from $1.7bn in 2015.
The company, which owns brands such as Moores Furniture Group, Axor, Bristan and Hansgrohe, saw a 2% increase in sales in Q3 to $1.9 billion (£1.5bn), compared with the same period last year.
On a reported basis, gross margins improved to 32.7% from 32%, and operating margins improved to 14.3% from 14% in Q3 2015.
Broken down into segments, plumbing product net sales improved by 5%, which was driven by growth in North America and internationally. However, cabinetry product net sales decreased 6% due to the exit of lower margin business in the builder channel, which was partially offset by growth in the retail and dealer channels.
“Our performance in the third quarter reflects our continued execution against our strategic initiatives,” said Masco’s president and chief executive, Keith Allman. “We invested in our industry leading brands to drive growth, and continued to improve profitability by leveraging our operations and selectively exiting lower margin business in our Cabinetry segment. Additionally, we continued our disciplined capital allocation by returning approximately $110 million (£89.9m) to shareholders through dividends and share repurchases during the quarter.”
He added: “Consumer demand for our market-leading products remains strong, as the fundamentals for long-term demand in both repair and remodel and new home construction continue to be positive. By leveraging our brand portfolio, our industry-leading positions and our Masco Operating System, we will continue to successfully execute against these positive industry fundamentals to achieve our long-term growth strategies.”