Quanex Building Products (QBP) makes engineered materials and components for, naturally enough, OEMs of building products. Its two business segments, Engineered Products and Aluminum Sheet Products, serve the new home building and remodeling markets in North America and, lesser so, in Asia and Europe. QBP produces aluminum flat-rolled products used in exterior home trims, screens, and gutters. It also churns out window and door components, insulating glass spacers, solar panel sealants, and extruded vinyl and composite framing material for fenestration OEMs. Top customers are Andersen and Associated Materials. QBP, formed via a spinoff and merger of Quanex/Gerdau, builds upon a history of business acquisitions.
The economic downturn and financial credit crisis that crushed the housing industry has rippled across all QBP product lines. It also has served the company's growth strategy, creating a bargain rack of building products business assets. QBP acquired Edgetech I.G., an Ohio-based maker of spacer systems for window and door markets, from Lauren International for $107 million in 2011. The deal expanded QBP's customer base in North America and Europe, as well as its international footprint, garnering facilities in Germany and the UK. Edgetech's operations join QBP's Engineered Products segment. Early in 2010, QBP purchased a facility in Shawano, Wisconsin, for producing wood flooring. The assets were picked up through a receivership proceeding.
Defying flagging activity in the residential construction market, the company celebrated a modest recovery in 2010. Sales increased more than 35% over the prior year's dismal low. Aluminum Sheet Products led the wave, posting nearly a 65% gain in sales, Engineered Products, more than a 10% gain. Quanex returned to profitability following a $137 million loss in 2009 and four years of declining earnings.
The company's results benefit from restructuring. It recalibrated its workforce, adjusted product pricing, and tightened operating efficiencies. Within the Engineered Products business, sales and marketing functions of subsidiaries Mikron, Truseal, and Homeshield were combined; the move is intended to showcase the lineup of window and door components, products and systems, under one portfolio to attract more business from smaller national and regional OEMs. Overseas, QBP closed its start-up facility in China. Citing poor demand, the company plans to leverage its North American operations to court international business for thin film solar panels. In 2009, Homeshield consolidated two plants into one facility. Although Aluminum Sheet Products (Nichols Aluminum) cut shift work at its casting facility and idled rolling capacity at another, QBP invested $7 million in Nichols Aluminum's future, updating controls for lower cost processes.
Meanwhile, QBP is focusing on improving the energy efficiency, durability, and aesthetics of its window and door components. Among its introductions, its Engineered Products segment launched the ImperiClad branded door system, featuring a water-rot-and termite-proof threshold, and an energy efficient vinyl window system, branded EnergyCore. – less