Vancouver’s Northwest Pipe Company sees net sales jump nearly 50% in fourth quarter

Despite rising steel prices last year, Vancouver-based Northwest Pipe Company saw net sales increase nearly 50% in the last quarter of 2021.

By early 2022, steel prices had begun to drop significantly, Scott Montross, chairman and chief executive, said on an investor call in March. In 2021, steel prices nearly doubled as supply was nearly insufficient to meet demand nationwide, Montross said.

Problems also arose due to delivery disruptions, a small market, and production delays related to customer orders that were already in Northwest Pipe’s backlog.

But the company, which specializes in the manufacture of steel and prefabricated pipes for water transport systems, still managed to increase its sales by double digits at the end of the year.

“Based on the current strength of the precast-related market, we enter 2022 with strong momentum and expect precast business to remain strong in the near term,” Montross said in the year-end financials.

Northwest Pipe’s net sales increased 16.6% at the end of 2021 to $333.3 million from $285.9 million in 2020.

Gross margin fell 12.4% in the company’s annual financial results to $44.3 million, equivalent to 13.3% of net sales in 2021, from $50.5 million, or 17.7% of net sales, in 2020.

Net income was $11.5 million at year-end, compared to $19.1 million in 2020.

“This first quarter is one of the most important first quarters we’ve seen in a long time,” Montross said on the March call. “And a lot of these things are relatively short-term.”

Montross said the company expects to see strong revenue numbers if all goes according to the company’s plan.

“We have good momentum behind us right now,” added Montross.

It saw huge sales increases in the fourth quarter, a 47.8% increase to $102.5 million in the fourth quarter of 2021 from $69.4 million in 2020. Part of those sales included the sales from Northwest Pipe’s acquisition of ParkUSA in October 2021, precast concrete and steel fabrication. based company.

Montross noted that the company has seen steel prices recover due to world events.

“We’ve actually seen steel prices come back up,” Montross said. The effects could come from the conflict in Ukraine, as well as transport and transport costs.

“These are things that we’re going to have to pay close attention to and make sure we pass that through the system,” he said.

Steel delivery times appear stable, Montross said.

“We’re not opposed to high steel prices, we’re just opposed to price volatility that causes us delivery issues and things like that,” Montross said.

Shares of the company, which trade on the Nasdaq stock exchange, closed at $25.29 on Tuesday.

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