Why Severe Winter Could Boost Owens Corning
The upside of this winter’s snowstorm after snowstorm could be more roofing jobs for contractors and more revenue for Owens Corning, which makes shingles, the company’s chairman and CEO, Michael Thaman, told CNBC Wednesday.
“Typically, after a difficult winter, we do see a surge in the spring, and, hopefully, it will carry that re-roofing into the summer,” said Thaman.
Twenty-eight percent of Owens Corning's revenues comes from roofing material sales.
On Wednesday, the company posted an adjusted profit and revenue that topped Wall Street's expectations,and its shares rallied. Revenue inched up to $1.17 billion from $1.16 billion a year earlier. Analysts had expected $1.12 billion.
“We’re hearing reports across the country that there’s been a lot of roof damage,” added Thaman. “That’s good for the contractors who can go in and get additional business to repair those roofs. Obviously, that will put through demand for us.”
Because the company makes shingles from asphalt, which is a byproduct of oil, it closely monitors the price of oil, said Thaman. The CEO said that the company has noticed “asphalt inflation,” but has a strategy to counter it.
US crude oil futures prices ended higher—nearly $85 a barrel for light sweet crude oil—on Wednesday after Israel's foreign minister said Iran planned to send two Iranian warships through the Suez Canal en route to Syria.
Owens Corning's Thaman added: “We believe that the strength of the business will be able to pass some of that on to the marketplace and keep our margin structure in line with where it’s been in the last couple of years.”