WINCHESTER, Va. - Trex Company, Inc. (NYSE:TREX), a leading manufacturer of eco-friendly decking and railing, reported a fourth-quarter earnings beat and provided strong guidance that exceeded analyst expectations, sending its shares soaring by 8.5% as the market responded positively to the company's outlook.
For the fourth quarter, Trex reported earnings per share (EPS) of $0.20, marginally surpassing the analyst estimate of $0.19. Revenue for the quarter reached $196 million, also beating the consensus estimate of $193.24 million and representing a 2.1% increase from the $192 million reported in the same quarter last year.
The company's robust performance was attributed to strong consumer demand for its products, as well as the successful launch of new decking lines. Bryan Fairbanks, President and CEO of Trex, highlighted the traction gained by recent product introductions, including the Trex Transcend® Lineage™ decking line and the Trex Select® T-Rail system. These products have broadened the company's consumer base and expanded its market opportunity.
Looking ahead, Trex provided an optimistic outlook for the first quarter of 2024, with expected revenue in the range of $360-370 million, significantly above the analyst consensus of $308.3 million. For the full year 2024, the company anticipates revenue between $1.215 billion and $1.235 billion, with the midpoint of this range indicating a 12% year-on-year growth, compared to the consensus estimate of $1.218 billion.
The company's guidance reflects confidence in continued demand growth and the benefits of an early buy program shifted to the first quarter of 2024. Trex also plans to continue investing in branding, sales, marketing, and new product development to capitalize on the growing outdoor living market, which is estimated to be worth $14 billion.
Fairbanks expressed satisfaction with the company's ability to navigate an uncertain business environment in 2023 and emphasized the strategic investments made to drive future growth. "These investments are aligned with our strategy to capture an increasing share of decking, railing, and adjacent products," he said.
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