Question-and-Answer Session
Operator
We will take our first question from Ian Zaffino with Oppenheimer & Co
Ian Zaffino-Oppenheimer & Co
Great, thank you very much. Good quarter, despite the seasonality here.
William Griffiths
Thank you, Ian.
Ian Zaffino-Oppenheimer & Co
I just have a couple questions. As far as the SRI acquisition, if there was no accounting issues there, how much more would Canada’s sales have been up? If you could give us an idea of that, and then I have a follow up.
Phyllis Knight
That’s a crafty way to stir the question up there Ian. I think in terms of unit sales out of SRI, we got about half of a normal quarter in the first quarter. So hopefully that helps you do the math.
Ian Zaffino-Oppenheimer & Co
Okay. Then as far as the outlook, you’re saying that that is relatively unchanged. Are you more positive that the negative, given that we sort of see HUD up actually 2% where a lot of us were looking for it to be roughly flat, to roughly down a little bit. If you could kind of elaborate on that, that would be helpful too.
William Griffiths
Yes, Ian. I am more positive now than I was at the beginning of the quarter because, quite frankly, this quarter turned out pretty much as we expected it to and I think all the indications are that our statements, which may have sounded overly optimistic at the end of the year, I think now perhaps have a little more context around them. I mean clearly the business in the south for HUD-CODE is very strong even though, as we’ve said, it’s one of the weaker markets, for our sale plants down there are clearly seeing stronger business. We’re seeing a favorable trend right now; it’s still early of course, but a favorable trend in the Midwest and northeast. Obviously we continue to be concerned about California and Arizona. On the modular side, if you exclude the Fort Lewis impact, the decline in our modular shipments this quarter was actually only about 10%, which is half of the decline on average through last year, so we consider that to be a positive trend as well. So all in all and of course Canada and the UK we continue to have high expectations and they continue to deliver. So, as we said, it’s very easy in the depths of winter to be very pessimistic about the future, but we’re encouraged. As we’ve said before, we think the recovery will be slow, but it has to start somewhere and 2.2% is at least moving it in the right direction.
- To read the full transcript on Seeking Alpha, click here »
