The World Famous "Fence Wizard": TREX sets aside another $45 million for defective product replacements....

Sunday, November 11, 2007

TREX sets aside another $45 million for defective product replacements....

TREX is one of the nations largest manufacturer of Fence and Deck material and has seen its stock price fall from $27.70 back in February to the current price of $8.00 on Nov 9, 2007. Trex had already lowered 2007 earnings estimates citing a significant effect from the construction slowdown. But the Fence Wizard is focused on the announcement of the massive $45million charge to create a reserve for defective product replacement. If you install or own a TREX product - please comment and let us know what is going on with this company and how you have been affected. Is Trex paying for labor to replace defective products?

Nov. 6, 2007, 7:48AM: 3Q Loss for Deck and Fence Maker Trex
© 2007 The Associated Press

WINCHESTER, Va. — Trex Co. Inc., which makes decking, railing and fencing products, said Tuesday it swung to a loss in its third quarter due mainly to a large reserve for replacing defective decking material manufactured at one of its plants.

For the quarter ended Sept. 30, the company reported a loss of $41.2 million, or $2.77 per share, compared to a profit of $4.6 million, or 31 cents per share, in the prior year quarter.
Analysts polled by Thomson Financial expected a profit of 11 cents per share. Trex said its profit was hurt by a $45 million increase to a product defect reserve for the replacement of decking material manufactured at its Nevada plant between 2003 and 2006 and a $9.4 million inventory adjustment. Revenue fell 18 percent to $64 million from $78.1 million in the third quarter of 2006. Analysts predicted revenue of $75.9 million.

Trex Warranty Infomation
Trex Press Release addresses Defect Issue

1 comment:

Anonymous said...

How doe you know if your Trex product is part of that problem? Is the code on the trex boards the telltale, and if so , what is the codes? Trex will not tell me.

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