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Management Side
Technical Side
UFP Announces Plant Closures
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Grand Rapids, Michigan, USA, 21 Jauary 2008 --(BUSINESS WIRE)-- Universal Forest Products, Inc. (Nasdaq: UFP) today announced the closure and intended sale of a number of facilities to better align manufacturing capacity with the current business environment.

"In a housing market that continues to deteriorate, we must proactively manage our assets and operations, position our company for growth when housing stabilizes, and take advantage of opportunities in our three other core markets," said Michael B. Glenn, president and CEO.

The closures are expected to result in pre-tax, noncash charges of approximately USD 6.8 million (USD 5.5 million after income taxes) to write down the value of certain property, plant and equipment. In addition, the company will recognize severance and other nonrecurring expenses of approximately USD 2 million (USD 1.3 million after income taxes). All of these costs will be recorded in the fourth quarter of 2007.

"While these plant closings are difficult, there are tangible long-term benefits. We're taking excess costs and capital out of our operations and establishing a more efficient structure to meet current and future needs," Glenn said.

The company believes that it can effectively consolidate operations of plants capable of serving the same geographic markets and accommodate current business and future growth through manufacturing efficiencies created as a result of continuous improvement efforts.

Closed facilities in Stanfield and Sanford, North Carolina; Gulfport, Mississippi; Elkhart and Westville, Indiana; and a portion of the operations in Thorndale, Ontario, Canada, will not be needed when the housing market recovers and, therefore, are expected to be sold. Operations from these facilities have been consolidated into plants in New London and Bunn, North Carolina; New Waverly, Texas; White Pigeon, Michigan; Granger, Indiana; and Emlenton, Pennsylvania, respectively.

The sale of these facilities, together with the sale of other excess real estate, is expected to generate approximately USD 38 million in positive cash flow before taxes in 2008. Due to current market conditions, the company also has temporarily closed eight other operations and has consolidated them into existing Universal facilities. Collectively, the closed operations had total estimated pre-tax operating losses of more than USD 11 million in 2007, before the charges noted above.

"We've worked hard to maintain a solid financial position in the face of a housing downturn that had a devastating impact on so many other companies," Glenn said. "Our balance sheet is strong and we continue to generate positive cash flow, which will help fuel our ongoing growth strategy."

For its third quarter 2007, Universal reported year-to-date net sales of USD 2 billion, down from USD 2.17 billion for the same period in 2006, and year-to-date net earnings of USD 32 million, down from USD 60.9 million for the same period in 2006, attributing the drop in earnings to the decline in the housing market. The company is scheduled to release fourth quarter 2007 results after the close of the trading market on 06 February 2008, followed by a conference call with analysts at 8:30 a.m. Eastern Time on 07 February 2008.

Universal Forest Products markets, manufactures, and engineers wood and wood-alternative products for DIY/retail home centers, structural lumber products for the manufactured housing industry, engineered wood components for the site-built construction market, and specialty wood packaging for various industries. The company also provides framing services for the site-built sector and various forms for concrete construction. The company reported sales of nearly USD 2.66 billion in 2006. For information about Universal Forest Products, visit www.ufpi.com.


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