Stella-Jones Inc. announced financial results for its 3Q ended September 30, 2016. Sales reached $512.6 million, up 18.4% from $433.1 million a year ago.
Operating income amounted to $67.3 million, or 13.1% of sales, versus $62.9 million, or 14.5% of sales, last year. The increase in absolute dollars reflects the contribution from acquisitions and the effect of currency translation.
Net income for the 3Q 2016 increased 16.1% to $45.7 million, or $0.66 per diluted share, compared with $39.3 million, or $0.57 per diluted share, in the 3Q 2015.
"Stella-Jones' sales and net income growth in the 3Q reflects the contribution from acquisitions and our greater reach in the residential lumber product category. As anticipated, year-over-year railway tie sales were lower following strong demand in the previous twelve months, while market conditions remained relatively soft in the utility pole category. Still, improved working capital resulted in a solid cash flow generation that we directed towards reducing our debt," said Brian McManus, President and CEO.
For the nine-month period ended September 30, 2016, sales amounted to $1.50 billion, versus $1.20 billion for the corresponding period a year earlier.
Operating income stood at $205.1 million, or 13.7% of sales, compared with $171.8 million, or 14.3% of sales, a year earlier. Net income for the first nine months of 2016 increased 24.9% to $135.4 million, or $1.96 per diluted share, up from $108.4 million, or $1.57 per diluted share, in the first nine months of 2015.
Stella-Jones Inc. is a leading producer and marketer of pressure treated wood products.