Operational Efficiencies Continue to Drive Margin Expansion 
Leverage Profile Improves Further

HOUSTON, May 31, 2016 (GLOBE NEWSWIRE) --  Quanex Building Products Corporation (NYSE:NX) (“Quanex” or the “Company”) today announced its results for the quarter ended April 30, 2016.

Second Quarter 2016 Highlights

• Net sales increased 62% to $229.5 million compared to $142.0 million in Q2 2015
• Net income increased 72% to $3.9 million compared to $2.3 million in Q2 2015
• Adjusted EBITDA more than doubled to $24.3 million (11% margin) versus $11.6 million (8% margin) in Q2 2015
• Year-to-date cash provided by operating activities increased 643% to $24.6 million compared to the same period last year
• All borrowings under Asset-Based Lending facility were repaid as of April 30, 2016

Bill Griffiths, Chairman, President and Chief Executive Officer, stated, “In line with our expectations and guidance, our legacy window component business in the U.S. grew 6% during the first half of our fiscal year, excluding the impact of certain eliminated products, price changes and raw material pass through adjustments.  In addition, our ongoing focus on margin expansion through operational efficiency gains continues to be effective, as EBITDA margins improved by approximately 250 basis points this quarter.  As a result, we are increasing guidance for 2016 to more accurately reflect our current expectations.  We also made further progress towards the goal of improving our leverage ratio to under 2.5x by the end of this fiscal year, and we remain confident in our ability to do so.”

Second Quarter 2016 Results Summary

Net sales increased by $87.5 million to $229.5 million during the three months ended April 30, 2016, compared to the three months ended April 30, 2015.  The increase was driven by revenue generated from the acquisitions of HL Plastics and Woodcraft Industries in 2015 coupled with continued volume growth in all other reporting segments, partially offset by foreign exchange translation impact.  (See Sales Analysis table for additional information)

The Company generated Adjusted EBITDA of $24.3 million for the quarter, compared to $11.6 million during the same quarter of 2015.  Margin expansion continues due to the successful implementation of several ongoing operational initiatives that are designed to reduce costs while improving productivity.  For its “legacy” U.S. windows components business, the Company realized EBITDA margin improvements of approximately 200 basis points during the three months ended April 30, 2016, and approximately 400 basis points for the six months ended April 30, 2016.  (See Non-GAAP Financial Measure Disclosure table and Selected Segment Data table for additional information)

Quanex’s leverage ratio of Net Debt to LTM Pro Forma Adjusted EBITDA improved to 2.6x.  This leverage ratio uses LTM Pro Forma Adjusted EBITDA, which is a non-GAAP measure that, in accordance with the Company’s credit facility, assumes the acquisitions of HL Plastics and Woodcraft Industries occurred at a date prior to the actual date of acquisition, and thus includes pro forma adjustments to calculate the trailing twelve months of EBITDA including the HL Plastics and Woodcraft Industries acquisitions.  (See Non-GAAP Financial Measure Disclosure table for additional information)

Fiscal 2016 Guidance Update

The guidance update incorporates Quanex’s year-to-date results and reflects management’s current expectations for the full year.  The Company updated net sales guidance to $965 – $975 million, which is unchanged at 5% to 6% pro forma growth year-over-year, but now incorporates the Company’s latest estimates for the expected impact of foreign exchange translation based on current exchange rates.  Quanex increased Adjusted EBITDA guidance to $117 - $121 million, as compared to previous guidance provided in December 2015 of $112 - $120 million. 

Recent Events

The Company’s Board of Directors declared a quarterly cash dividend of $0.04 per share on Quanex’s common stock, payable June 30, 2016, to shareholders of record on June 15, 2016.

Conference Call and Webcast Information

The Company has scheduled a conference call for Wednesday, June 1, 2016, at 11:00 a.m. ET (10:00 a.m. CT). To participate in the conference call dial (877) 388-2139 for domestic callers and (541) 797-2983 for international callers, in both cases using the conference passcode 93625878, and ask for the Quanex call a few minutes prior to the start time.  A link to the live audio webcast will also be available on the Company’s website at http://www.quanex.com in the Investors section under Presentations & Events.  A telephonic replay of the call will be available approximately two hours after the live broadcast ends and will be accessible through June 8, 2016.  To access the replay dial (855) 859-2056 for domestic callers and (404) 537-3406 for international callers, in both cases referencing conference passcode 93625878. 

About Quanex

Quanex Building Products Corporation is an industry-leading manufacturer of components sold to Original Equipment Manufacturers (OEMs) in the building products industry.  Quanex designs and produces energy-efficient fenestration products in addition to kitchen and bath cabinet components.

Non-GAAP Terminology Definitions and Disclaimers

Each of the Non-GAAP measures discussed in this Press Release are defined below.  More information and reconciliations related to each of these measures can be found in the tables that accompany this Press Release.

EBITDA for each reported period is defined as net income or loss before interest, taxes, depreciation and amortization and other, net.

Adjusted EBITDA for each reported period is defined as EBITDA excluding transaction costs and purchase price accounting adjustments related to inventory step-ups. 

LTM Pro Forma Adjusted EBITDA is defined as Adjusted EBITDA for the past twelve months, assuming that the acquisitions of HL Plastics and Woodcraft Industries occurred at a date prior to the actual date of acquisition and thus includes pro forma adjustments to calculate the trailing twelve months of EBITDA including the HL Plastics and Woodcraft Industries acquisitions.  These adjustment items are not historical in nature and therefore cannot be reconciled to a comparable GAAP measure.

Forward Looking Statements

Statements that use the words “estimated,” “expect,” “could,” “should,” “believe,” “will,” “might,” or similar words reflecting future expectations or beliefs are forward-looking statements. The forward-looking statements include, but are not limited to, future operating results of Quanex, the future financial condition of Quanex, future uses of cash and other expenditures, expenses and tax rates, expectations relating to the Company’s industry, and Quanex’s future growth, including any guidance discussed in this press release.  Guidance is a forward-looking estimate of performance and may not be indicative of actual results.  The statements and guidance set forth in this release are based on current expectations. Actual results or events may differ materially from this release. Factors that could impact future results may include, without limitation, the effect of both domestic and global economic conditions, the impact of competitive products and pricing, the availability and cost of raw materials, and customer demand. For a more complete discussion of factors that may affect the Company’s future performance, please refer to the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2015, under the sections entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors,” and in Quanex’s other documents filed with the Securities and Exchange Commission from time to time.  Any forward-looking statements in this press release are made as of the date hereof, and Quanex Building Products Corporation undertakes no obligation to update or revise any forward-looking statements to reflect new information or events.

For more information contact 
Scott Zuehlke, 
Vice President of Investor Relations & Treasurer, 
at 713-877-5327 or scott.zuehlke@quanex.com.