Stella-Jones Inc. announced financial results for its Q1 ended March 31, 2024. Sales in the Q1 2024 were up 9% to $775 million, compared to $710 million last year. Excluding the contribution from the acquisition of Baldwin Pole and Piling Company, Inc., Baldwin Pole Mississippi, LLC and Baldwin Pole & Piling, Iowa Corporation, sales were up $51 million, or 7%. The increase was driven by a 10% organic sales growth of the Company’s infrastructure businesses, namely utility poles, railway ties and industrial products, partially offset by lower residential lumber and logs and lumber sales when compared to the same period last year. All infrastructure product categories benefited from higher year-over-year sales prices, while residential lumber sales were unfavourably impacted by the decrease in the market price of lumber when compared to the same period last year.
Gross profit was $172 million in the Q1 2024 compared to $136 million in the corresponding period last year, representing a margin of 22.2% and 19.2%, respectively. The increase in gross profit in absolute dollars and as a percentage of sales were largely due to the margin expansion of the Company’s infrastructure product categories, particularly attributable to the favourable pricing realized for utility poles and railway ties.
Similarly, operating income totaled $124 million in the Q1 2024 versus operating income of $95 million in the corresponding period of 2023, while EBITDA increased to $156 million, or a margin of 20.1%, compared to $120 million, or a margin of 16.9% reported in the Q1 2023.
Net income for the Q1 2024 was $77 million, or $1.36 per share, compared to net income of $60 million, or $1.03 per share, in the corresponding period of 2023.
“I am pleased with our performance in the Q1, which marks a strong start to the year and builds upon the momentum we generated in 2023,” said Eric Vachon, President and CEO of Stella-Jones. “Our Q1 performance reflects the ongoing robust fundamental market trends in our infrastructure product categories and an improvement over our solid fourth quarter results. Although we noted a softer pace of purchases by utilities in recent quarters, we are confident that incremental multi-year volume commitments secured from new and existing customers will be realized, highlighting the enduring growth potential of our business.”
“The sustained strength of our results is a testament to our focus on growing our infrastructure business and leveraging our unique competitive advantages. We are drawing on the strength of our customer relationships and expansive network to capitalize on growth opportunities and deliver on our strategic objectives,” concluded Mr. Vachon.
Stella-Jones Inc. is a leading North American manufacturer of pressure-treated wood products, focused on supporting infrastructure that is essential to the delivery of electrical distribution and transmission, and the operation and maintenance of railway transportation systems.
