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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 22, 2005
TREX COMPANY, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 001-14649 54-1910453
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
160 Exeter Drive
Winchester, Virginia 22603-8605
(Address of Principal Executive Offices) (ZIP Code)
Registrant's telephone number, including area code: (540) 542-6300
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On June 22, 2005, Trex Company, Inc. issued a press release
announcing preliminary financial results for the quarter ending June 30, 2005
and revising its annual guidance for 2005. A copy of such press release is
attached hereto as Exhibit 99.1 and incorporated herein by reference.
The information contained in this report on Form 8-K shall not be
deemed to be filed for the purposes of Section 18 of the Securities Exchange Act
of 1934 or otherwise subject to the liabilities of that Section.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
TREX COMPANY, INC.
Date: June 22, 2005 By: /s/ Robert G. Matheny
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Robert G. Matheny
Chairman and Chief Executive Officer
EXHIBIT INDEX
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Exhibit Number Exhibit Description
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99.1 Press release dated June 22, 2005.
Exhibit 99.1
Trex Company Announces Preliminary Second Quarter 2005 Results;
Revises Annual Guidance for 2005
WINCHESTER, Va.--(BUSINESS WIRE)--June 22, 2005--Trex Company,
Inc. (NYSE:TWP), manufacturer of Trex(R) decking and railing, today
announced that it expects net sales for the second quarter of 2005 to
be in the range of $75 million to $80 million, compared to $83.4
million for the second quarter of 2004. Net sales for the first six
months of 2005 are expected to be in the range of $165 million to $170
million, which would represent an increase of approximately 3-6% over
the $159.7 million in net sales for the first six months of 2004. The
Company expects to record a net loss for the second quarter of 2005 in
the range of $0.20 to $0.25 per diluted share, compared to net income
of $0.75 per diluted share in the second quarter of 2004.
Chairman and Chief Executive Officer Robert Matheny said, "A
combination of factors, both on the revenue and the income side, are
making this year much more challenging than we had anticipated. On the
top line, our results have been affected by higher than anticipated
retail inventory levels, which have adversely impacted our sales. In
addition, as discussed in our first quarter 2005 earnings
announcement, unfavorable weather in many parts of the U.S.
significantly delayed the onset of this year's decking season,
negatively affecting the sell-through of our products. A slower than
expected expansion of our new distribution program with The Home Depot
also caused sales to be less than expected.
"On the income side, our results in the first six months of 2005
have been negatively affected by the higher price of plastic raw
materials, which increased by approximately 70% over the price in the
first six months of 2004. Production costs have also been higher than
normal due to the start-up of our new Olive Branch manufacturing
facility, which came on line as scheduled in the second quarter, and
the introduction of Trex Brasilia(TM) and Trex Artisan Series
Railing(TM)."
Mr. Matheny continued, "Despite these challenges, we are
encouraged by a recent survey of our retail distribution channels,
which indicates that downstream sales have risen 20% - 25% year over
year, a sign that our dealers are selling out of inventory. We are
also encouraged by the fact that the Company's recent order patterns
are showing a recovery to more normal levels. Although it is difficult
to obtain specific data at the dealer level, in speaking with
contractors throughout the U.S., indications are that their business
is robust and they are trying to catch up from a slow start caused by
this year's poor weather. Nonetheless, we are taking a number of
measures to curtail unneeded manufacturing capacity and to reduce
expenses.
"We remain pleased with consumers' response to our new marketing
campaign and expanded product line-up. The conversion from wood to
composite decking and railing is continuing, presenting us with an
excellent market opportunity longer term. By continuing to offer
superior products, drive brand awareness, and increase our
distribution footprint, we believe Trex will be well positioned to
take advantage of the many opportunities that exist for growth."
As a result of the factors described above, the Company is
revising its previously announced guidance for 2005, which called for
net sales to range from $300 million to $310 million and earnings per
diluted share to range from $2.16 to $2.23. For 2005, the Company now
expects net sales in the range of $270 million to $280 million and
earnings per diluted share in the range of $0.50 to $0.60. For 2004,
Trex Company reported net sales of $253.6 million and earnings per
diluted share of $1.83.
The Company has scheduled a conference call for 8:30 a.m. ET on
June 23, 2005 to discuss its current outlook. A live webcast of the
conference call will be available to all investors at the Trex Company
Web site at www.trex.com. The call will also be simulcast at
www.streetevents.com.
For those who cannot listen to the live broadcast, an audio replay
of the call will be available on these web sites for 30 days. A
telephone replay of the call will also be available through Thursday,
June 30, 2005. To listen to the telephone replay, dial 1-706-645-9291
and enter conference ID #7308207.
The Company expects to release results for the second quarter,
which ends on June 30, 2005, after the market closes on Wednesday,
July 27, 2005. The Company expects to hold a conference call to
discuss those results on Thursday, July 28, 2005. Additional details
about the conference call will be published in advance of the call.
About Trex Company
Trex Company is the nation's largest manufacturer of composite
decking, which is marketed under the brand name Trex(R). Made from a
unique combination of reclaimed wood and plastic, Trex decking and
railing products offer significant design flexibility with fewer
ongoing maintenance requirements. For more information, visit the
Company's website, www.trex.com. Trex(R), Trex Brasilia(TM) and Trex
Artisan Series Railing(TM) are trademarks of Trex Company, Inc.,
Winchester, Va.
The statements in this press release regarding the Company's
expected sales performance and operating results, its projections of
net sales, net income, earnings per share and costs, its anticipated
financial condition and its business strategy constitute
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. These statements are subject to risks and uncertainties that
could cause the Company's actual operating results to differ
materially. Such risks and uncertainties include the extent of market
acceptance of the Company's products, the sensitivity of the Company's
business to general economic conditions, the Company's ability to
continue to obtain raw materials at acceptable prices, the Company's
ability to increase production levels to meet increasing demand for
its products, and the highly competitive markets in which the Company
operates. The Company's report on Form 10-K filed with the Securities
and Exchange Commission on March 16, 2005 and its subsequent filing on
Form 10-Q for the first quarter of 2005 discuss some of the important
factors that could cause the Company's actual results to differ
materially from those expressed or implied in these forward-looking
statements. The Company expressly disclaims any obligation to update
or revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise.
CONTACT: Trex Company, Inc.
Paul Fletcher, 540-542-6300
or
Lippert/Heilshorn & Associates, Inc.
Investor Relations Contact:
Harriet Fried, 212-838-3777
or
Media Contact:
Michael Hopkins, 212-838-3777