Insteel(US:IIIN)2025-07-02 06:18Business Overview - Insteel Industries is the nation's largest manufacturer of steel wire reinforcing products for concrete construction applications[6] - The company manufactures and markets welded wire reinforcement (WWR) which accounts for 61% of 2016 sales, and prestressed concrete strand (PC strand) products which accounts for 39% of 2016 sales[5] - Nonresidential construction accounts for 85% of sales, while residential construction accounts for 15% of sales[9] - Concrete product manufacturers account for 70% of sales, while distributors, rebar fabricators, and contractors account for 30% of sales[10] Growth Strategy - Existing facilities are capable of generating over $700 million of annualized revenues at current ASPs with minimal incremental capex required[31] - In November 2010, Insteel acquired Ivy Steel & Wire, Inc for $50.3 million[34] - In August 2014, Insteel acquired American Spring Wire Corporation for $33.5 million[37] Financial Performance - FY2016 net sales were $418.5 million[40] - The company's gross profit for 2016 was $85.2 million, representing a gross margin of 20.4%[51] - EBITDA for 2016 was $73.1 million, with an EBITDA margin of 17.5%[55] - As of October 1, 2016, Insteel was debt-free with $58.9 million of cash and cash equivalents[77] Market Conditions and Outlook - Total construction spending for 2015 was up 10.6% from the prior year[83] - Total construction spending for August YTD 2016 was up 4.9% from the prior year[86] - The FAST Act authorizes $305 billion of funding over a five-year period, including $226.2 billion for federal highway investment[106] - The first phase of the Texas PC strand expansion is expected to reduce annual operating costs by $5.0 million[107]