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Masco swings to 3Q profit on higher sales

October 24, 2011

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TAYLOR, Mich.—Masco Corp., which makes building products and is closely tied to the housing market, said Monday that it swung to a third-quarter profit partly on favorable currency exchange.

The company said foreclosures, falling home prices and limited credit continued to block a housing recovery. Consumers also put off expensive repairs and remodeling jobs.

Net income was $36 million, or 10 cents per share, compared with a loss of $5 million, or 2 cents per share, a year earlier.

The company said it would have earned 8 cents per share excluding distributions from private equity funds and other special items and using a tax rate of 36 percent.

Revenue rose 3 percent to $2.01 billion. Sales in North America were flat but international sales rose 12 percent -- 4 percent without currency-exchange benefits.

Analysts, who usually exclude special items, expected earnings of 7 cents per share on revenue of $1.97 billion, according to FactSet.

The company said it held overhead steady. Selling, general and administrative costs were $393 million, $1 million more than a year earlier.

The company makes plumbing fixtures, cabinets and other building products and sells installations services. It has identified some lines it wants to exit, including framing, commercial drywall installation, and millwork.

Masco shares rose 34 cents, or 3.8 percent, to close at $9.34 before the results were released.