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JELD-WEN Reports Major Losses in Fourth Quarter

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Investors concerned over JELD-WEN financial losses

News Summary

JELD-WEN Holding, Inc. has reported a substantial loss of $68.4 million in its fourth quarter, leading to a share drop of 27%. Despite a revenue surpassing expectations, the company’s future outlook has turned bleak due to rising costs and anticipated declines in volume for 2024. Strategic closures and optimizations are in place to combat these challenges. Investors and analysts alike are keeping a close watch on JELD-WEN’s adjustments as it navigates these turbulent financial waters.

JELD-WEN’s Tough Times: Major Losses Reported in Fourth Quarter

In the bustling city of Charlotte, home to various industries, the latest news has some folks worried. JELD-WEN Holding, Inc. has just announced its fourth-quarter performance, and let’s just say it wasn’t pretty. The company reported a substantial loss of $68.4 million for the quarter, which breaks down to a staggering 81 cents per share. While some losses are expected in the world of business, this drop was worse than Wall Street’s predictions, which estimated losses at just 7 cents per share.

Revenue: A Double-Edged Sword

Now, it’s not all doom and gloom. If you take a look at their fourth-quarter revenue, you’ll see a silver lining. JELD-WEN reported revenue of $895.7 million, which actually surpassed expectations. Analysts had predicted a more modest $843.8 million. However, when you compare this to last year’s numbers, the company faced a decline in its core quarterly revenue of 13.2%. It slipped to $934.7 million from $1.08 billion just a year earlier.

Year in Review

Looking back over the year, JELD-WEN tallied a total loss of $189 million, or $2.22 per share. Their total revenue for 2023 stood at a commendable $3.78 billion. But with the recent news, expectations are shifting. For 2024, JELD-WEN now anticipates annual revenue to land between $3.2 billion and $3.4 billion, significantly lower than previous projections.

Sinking Shares and Future Outlook

The financial woes have already affected investor confidence. Following the loss announcement, JELD-WEN saw its shares plunge by 27% during morning trading. This drop has brought the stock price to under $10, a low that hasn’t been seen since December 2022. The company’s net loss from continuing operations clocked in at $73 million, or 86 cents a share, in comparison to a profit of $16.9 million, or 20 cents a share, from the same quarter last year.

Challenges Ahead

The company’s leadership has acknowledged that market conditions are deteriorating, which is having a significant negative impact on performance. In a bid to mitigate these losses, JELD-WEN has announced plans to close facilities located in Alabama and Denmark, while also aiming to optimize production in the UK. It operates in 16 countries and employs about 18,000 individuals, so these changes could have a ripple effect.

The forecast for 2024 is less than rosy, with anticipated “low double-digit” volume declines in both North America and Europe. On the construction front, new single-family projects are expected to see slight growth, but the repair and remodel market could take a hit, potentially dropping by “mid-to-high single-digits.” In Canada, things look even bleaker, as multifamily construction is projected to decline by over 25%.

Cost Pressures

One factor impacting JELD-WEN’s performance has been the rising costs of labor and materials. While these increases can be daunting, the company has managed to offset some of the burdens through reduced expenses and improved productivity. However, it hasn’t been enough to prevent a downward adjustment in their revenue outlook for 2024, which has shifted from a range of $3.9 billion to $4.1 billion down to $3.7 billion to $3.75 billion. The projected adjusted EBITDA for the year has similarly been cut from an estimated $340 million to $380 million down to a range of $265 million to $280 million.

Conclusion

As JELD-WEN navigates through this rocky terrain, all eyes will be on the company to see how they strategize moving forward. With market challenges at the forefront, it’s essential to keep track of their adjustments and decisions in the coming year. The future may hold surprises—good or bad—so stay tuned!

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