Quanex Building Products Corporation (NYSE:NX) Q4 2019 Earnings Conference Call - Final Transcript
Dec 12, 2019 • 11:00 am ET
Ladies and gentlemen, thank you for standing by, and welcome to the Fourth Quarter and Full Year 2019 Quanex Building Products Earnings Conference Call. [Operator Instructions] After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]
I would now hand the conference over to the Chief Financial Officer and Treasurer, Mr. Scott Zuehlke.
Thanks for joining the call this morning. On the call with me today are Bill Griffiths, our Chairman, President and Chief Executive Officer; and George Wilson, our Chief Operating Officer. This conference call will contain forward-looking statements and some discussion of non-GAAP measures. Forward-looking statements and guidance discussed on this call and in our earnings release are based on current expectations. Actual results or events may differ materially from such statements and guidance, and Quanex undertakes no obligation to update or revise any forward-looking statements to reflect new information or events. For more detailed description of our forward-looking statement disclaimer and a reconciliation of non-GAAP measures to the most directly comparable GAAP measures, please see our earnings release issued yesterday and posted to our website.
I will now discuss the financial results. Net sales decreased by 1.5% year-over-year to $240.4 million in the fourth quarter of 2019, mainly due to continued softness in our North American Cabinet Components segment. However, we generated net sales of $893.8 million for the year, which represents growth of approximately 50 basis points compared to fiscal 2018. The increase was driven by above-market growth and our North American and European fenestration segment, which was mostly the result of price increases related to raw material inflation recovery. Excluding foreign exchange impact, we realized revenue growth of 1.4% in fiscal 2019 compared to fiscal 2018.
We reported a net loss of $30.9 million or $0.94 per diluted share for the three months ended October 31st, 2019, compared to net income of $6.7 million or $0.19 per diluted share during the three months ended October 31st, 2018. For fiscal 2019, we reported a net loss of $46.7 million or $1.42 per diluted share compared to net income of $26.6 million or $0.76 per diluted share for fiscal 2018. The reported net losses were primarily attributable to a $44.6 million non-cash goodwill impairment in the fourth quarter, and a $30 million non-cash goodwill impairment in the second quarter, both in the North American Cabinet Components segment, mainly due to lower volume expectations related to the ongoing shift in the market from semi-custom to stock cabinets and customer-specific strategy changes.
On an adjusted basis, net income was $14 million or $0.42 per diluted share during the fourth quarter of '19 compared to $7.6 million or $0.22 per diluted share during the fourth quarter of 2018. Adjusted net income was $31.4 million or $0.95 per diluted share for fiscal 2019 compared to $22.7 million or $0.65 per diluted share for fiscal 2018. The adjustments being made to EPS are for restructuring charges, certain executive severance charges, non-cash asset impairment charges, accelerated D&A, the impact of deferred loan