Quanex Building Products Stock

Quanex Building Products Corporation manufactures components for original equipment manufacturers (OEM) in the building products industry. The majority of the components can be categorized as window and door (fenestration) components and kitchen and bath cabinet components. Examples of fenestration components include energy-efficient flexible insulating glass spacers, extruded vinyl profiles, window and door screens, and precision-formed metal and wood products. In addition, the company provides certain other non-fenestration components and products, which include solar panel sealants, trim moldings, vinyl decking, vinyl fencing, water retention barriers, and conservatory roof components.

The company uses production processes and engineering expertise to provide its customers with specialized products for their specific applications. The company serves a primary customer base in North America and the United Kingdom (U.K.), and also serves customers in international markets through its operating plants in the U.K. and Germany, as well as through sales and marketing efforts in other countries.

Strategy

The key elements of the company's strategy are to focus on growth with a purpose and explore markets that are synergistic with existing manufacturing capabilities and expand its market share with national and regional customers and collaborative partnerships; realize improved profitability in its manufacturing processes through ongoing preventive maintenance programs, better utilization of its capacity by focusing on operational efficiencies and reducing scrap, marketing its value added products, and focusing on employee safety; offer logistics solutions that provide its customers with just-in-time service; recognize the importance of sustainability by continually looking for ways to reduce its environmental impact and carbon footprint, protect the health and safety of its employees and communities, engage diverse workers and leaders, and remain committed to doing good in its community; pursue targeted business acquisitions that allow it to expand its existing footprint, enhance its existing product offerings, acquire complementary technology, enhance its leadership position within the markets it serves, and expand into adjacent markets or service lines; and exit unprofitable or non-core service lines or customer relationships.

Sales, Marketing, and Distribution

The company sells its products to customers in various countries. Therefore, the company has sales representatives whose territories essentially cover the U.S., Canada, Europe, and to a lesser extent, the Middle East, Latin and South America, Australia, New Zealand and Asia. The company's sales force is tasked with selling and marketing its complete range of components, products and systems to national and regional OEMs through a direct sales force in North America and Europe, supplemented with the limited use of distributors and independent sales agents.

Customers

Certain of the company's businesses or product lines are largely dependent on a relatively few large customers.

Seasonal Nature of Business

The company's business is impacted by seasonality. The company has historically experienced lower sales for its products during the first half of its fiscal year as winter weather reduces homebuilding and home improvement activity. The company's operating income tends to decline during this period of lower sales because a higher percentage of its operating expenses are fixed overhead. The company typically experiences more favorable results in the third and fourth quarters of the fiscal year (year ended October 31, 2023).

Service Marks, Trademarks, Trade Names, and Patents

The company's federally registered trademarks or service marks include QUANEX, QUANEX and design, Q design, TRUSEAL TECHNOLOGIES, DURASEAL, DURALITE, SOLARGAIN, ENVIROSEALED WINDOWS, EDGETHERM, EDGETECH, ECOBLEND, SUPER SPACER, TSS, TRUE WARM, E & Design, QUIET EDGE, HEALTH SMART WINDOWS, ENERGY WISE WINDOWS, DESI-ROPE, 360 and design, INTELLICLIP, SUSTAINAVIEW, MIKRON, MIKRONWOOD, MIKRONBLEND, MIKRON BLEND and design, ENERGYCORE, FUSION INSULATED SYSTEM, AIRCELL, SUPERCOAT, SUPERCAP, STYLELOCK, STYLELOCK and design, MIKRON and design, HOMESHIELD, HOMESHIELD and design, STORM SEAL, and TENON. The company considers the following marks, design marks and associated trade names to be valuable in the conduct of its business: HOMESHIELD, TRUSEAL TECHNOLOGIES, EDGETECH, MIKRON, WOODCRAFT and QUANEX. Through Liniar, the company holds a number of registered designs, patents and trademarks registered in the U.K., which include: MODLOK, LINIAR, SUPER CUT, ENERGY PLUS & Device, FLAMSTEAD HOLDINGS & Device, HL PLASTICS & Device, VINTAGE WINDOWS & Device, RESURGENCE, FUSE, ELEVATE, SWITCHBOARD and various other trademarks and patents which are pending approval.

History

Quanex Building Products Corporation was founded in 1927. The company was incorporated in Delaware in 2007.