Owens Corning Cuts 2012 Earnings Forecast
With two weeks to go before its quarterly earnings report, Owens Corning (NYS: OC) has lowered its full-year 2012 outlook, citing weakness in its roofing and composites businesses. The construction company now expects full-year earnings before interest and taxes to come in between $280 million and $310 million,down from estimates in August of $360 million to $420 million.
Owens Corning's roofing shingle business has weakened over the past two quarters, most recently affected by a mid-September price increase. "While fixed cost controls continue to be effective, the significant revenue decline in the second half of 2012 will result in margin compression," noted the company in a press release.
Composites are also struggling to pull in revenue while keeping costs in line. European woes have hit the company's top line, while reinvestment in Mexican manufacturing facilities has increased short-term expenses.
Even as the U.S. housing market shows significant signs of improvement, Owens Corning isn't raising the roof over positive indicators. In its press release, the company states, "The global macro-environment outlook now places the attainment of double-digit margins at risk for 2013."
The article Owens Corning Cuts 2012 Earnings Forecast originally appeared on Fool.com.Justin Loiseau has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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