November 10, 2014
NCI Building Systems Reaches Definitive Agreement to Acquire CENTRIA
HOUSTON, November 10, 2014 – NCI Building Systems, Inc. (NYSE: NCS), a leading manufacturer of metal products for the nonresidential building industry, announced today that it has entered into a definitive agreement to acquire Pittsburgh area-based CENTRIA, an internationally recognized leader in the design, engineering, and manufacturing of architectural insulated metal panel (IMP) wall and roof systems and a provider of integrated coil coating services for the nonresidential construction industry. CENTRIA, which generates over 85% of its revenue in North America, is an industry leader in the creation of buildings that are aesthetically desirable, functional and sustainable. With more than 700 employees globally, CENTRIA has four production facilities in the United States, 36 satellite sales locations and a new manufacturing facility in China.
Norman C. Chambers, NCI’s Chairman, President and Chief Executive Officer, stated, “We believe there is a significant growth opportunity for architectural insulated panels because of their unique appeal in architectural applications that require a combination of attractive aesthetics, high performance, environmental sustainability and economic value. CENTRIA has established a distinguished position in the high-end IMP segment of the nonresidential wall and roof systems market by leveraging its exceptional engineering and manufacturing capabilities and its highly experienced and proprietary dealer network. In addition, like NCI, CENTRIA operates an integrated coil coating business that offers a high quality selection of coatings that meet similar aesthetic and performance criteria. The coil coating business provides superior services to a specialized customer base which includes both construction and other nonconstruction industries. By partnering with leading architects early in the conceptual stage of projects, CENTRIA leverages its unique combination of engineering, design, and manufacturing expertise to develop distinctive projects around the world.”
"Once complete, the acquisition of CENTRIA will immediately enhance our leadership position and expand the range of our cutting edge proprietary product offerings in the architectural metal panel market. NCI’s strategic objective continues to be to target above-market growth through organic initiatives as well as synergistic and complementary acquisitions. We believe that CENTRIA's unique market position complements our current family of businesses because there is little overlap with our existing market segments and there are significant opportunities to leverage our manufacturing footprint and supply chain. The CENTRIA team will continue to focus on the development of products and solutions for the success of its unparalleled and loyal customer base,” added Chambers.
Joel Mazur, President of CENTRIA, commented, “The acquisition of CENTRIA by NCI will considerably increase the current and future growth initiatives of the business and the opportunities for all stakeholders in CENTRIA, especially our exceptional customer base.” NCI has agreed to pay approximately $245 million in cash to acquire CENTRIA, which had trailing twelve months revenue of approximately $230 million as of September 2014. EBITDA margins, excluding synergies, for the acquired business are expected to be approximately 10% in 2014, but as nonresidential construction markets recover, normalized margins are expected to be in the 12-14% range. To fund the acquisition, NCI expects to issue $250 million of new senior unsecured notes. The transaction is subject to customary closing conditions and regulatory clearance and is expected to close during the first quarter of NCI’s fiscal year 2015. The Company expects the transaction, once completed, to be accretive to NCI’s earnings beginning in the fourth quarter of fiscal 2015, excluding transaction related charges and amortization of short-lived intangibles. The Company will provide additional details of the transaction during the FY14 fourth quarter earnings call on December 10, 2014.
About NCI Building Systems
NCI Building Systems, Inc. is one of North America's largest integrated manufacturers of metal products for the nonresidential building industry. NCI is comprised of a family of companies operating manufacturing facilities across the United States and Mexico, with additional sales and distribution offices throughout the United States and Canada.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words such as "believe," "guidance," "potential," “anticipate,” “plan,” "expect," "should," "will," "forecast" or similar expressions are intended to identify forwardlooking statements in this press release. These forward-looking statements reflect our current expectations, assumptions and/or beliefs concerning future events. The Company has made every reasonable effort to ensure that the information, estimates, estimates, forecasts and assumptions on which these statements are based are current, reasonable, and complete. However, these forwardlooking statements are subject to a number of risks and uncertainties that may cause the Company's actual performance to differ materially from that projected in such statements. Among the factors that could cause actual results to differ materially include, but are not limited to, our ability to integrate CENTRIA with our business or to realize the anticipated benefits of the acquisition of CENTRIA (the “Acquisition”), industry cyclicality and seasonality and adverse weather conditions; ability to service the Company's debt, including additional debt to finance the Acquisition; fluctuations in customer demand and other patterns; raw material pricing and supply; competitive activity and pricing pressure; general economic conditions affecting the construction industry; financial fluctuations in the U.S. and abroad; changes in laws or regulations; and the volatility of the Company's stock price. See also the “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended November 3, 2013, in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended February 2, May 4 and August 3, 2014, and other reports we file with the SEC, which identify other important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward-looking statements. NCI expressly disclaims any obligation to release publicly any updates or revisions to these forward-looking statements, whether as a result of new information, future events, or otherwise.
K. Darcey Matthews
Vice President, Investor Relations