McKINNEY, Texas — Encore Wire Corporation today announced results for the second quarter of 2021.
Net sales for the second quarter ended June 30, 2021 were $744.4 million compared to $253.6 million for the second quarter of 2020. Copper unit volume, measured in pounds of copper contained in the wire sold, increased 33.4% in the second quarter of 2021 versus the second quarter of 2020.
Gross profit percentage for the second quarter of 2021 was 37.3% compared to 14.4% in the second quarter of 2020. The average selling price of wire per copper pound sold increased 129.6% in the second quarter of 2021 versus the second quarter of 2020, while the average cost of copper per pound purchased increased 73.5%. Net income for the second quarter of 2021 was $183.1 million versus $12.3 million in the second quarter of 2020. Fully diluted net earnings per common share were $8.82 in the second quarter of 2021 versus $0.60 in the second quarter of 2020.
Net sales for the six months ended June 30, 2021 were $1.189 billion compared to $556.4 million for the six months ended June 30, 2020. Copper unit volume, measured in pounds of copper contained in the wire sold, increased 16.2% in the six months ended June 30, 2021 versus the six months ended June 30, 2020
Gross profit percentage for the six months ended June 30, 2021 was 30.4% compared to 14.8% for the six months ended June 30, 2020. The average selling price of wire per copper pound sold increased 89.2% in the six months ended June 30, 2021 versus the six months ended June 30, 2020, while the average cost of copper per pound purchased increased 60.5% for the same period comparison. Net income for the six months ended June 30, 2021 was $224.2 million versus $31.0 million in the six months ended June 30, 2020. Fully diluted net earnings per common share were $10.81 in the six months ended June 30, 2021 versus $1.50 in the six months ended June 30, 2020.
On a sequential quarter comparison, net sales for the second quarter of 2021 were $744.4 million versus $444.1 million during the first quarter of 2021. Sales dollars increased due to a 47.7% increase in the average selling price per pound of copper wire sold, combined with a 15.1% unit volume increase of copper building wire sold on a sequential quarter comparison.
Gross profit percentage for the second quarter of 2021 was 37.3% compared to 19.0% in the first quarter of 2021. Copper wire sales prices increased 47.7%, while the price of copper purchased increased 13.2% in the second quarter of 2021 compared to the first quarter of 2021. Net income for the second quarter of 2021 was $183.1 million versus $41.2 million in the first quarter of 2021. Fully diluted net income per common share was $8.82 in the second quarter of 2021 versus $1.99 in the first quarter of 2021.
Aluminum wire represented 6.1% and 6.6%, respectively, of our net sales in the quarter and six months ended June 30, 2021.
Commenting on the results, Daniel L. Jones, Chairman, President and Chief Executive Officer of Encore Wire Corporation, said, “The unprecedented results in the second quarter ended June 30, 2021 are grounded in the rich history and core values of the Company. Unbeatable customer service, nimble operations and quick deliveries coast to coast. Our one-location, vertically-integrated business model, strong management team, and deep raw material supplier relationships allowed us to remain fully operational, while maintaining our high standard for fill rates to meet surging demand in the current environment. By continuing to meet this value premise to our customers, we were able to increase copper volumes sold over the first quarter of 2021. We believe we can sustain this volume growth, compared to prior period levels, for the remainder of 2021.
Copper unit volumes increased 33.4% on a comparative quarter basis and 15.1% on a sequential quarter basis. Comex copper prices experienced upward volatility throughout the second quarter, peaking in May before pulling back slightly to end the quarter. This upward volatility had a positive impact on spreads. Copper spreads increased 234.0% on a comparative quarter basis and 109.2% on a sequential quarter basis.
We believe Encore Wire remains well positioned to capture additional market share and incremental growth in the current economic environment. As we address the near-term challenges, we remain focused on the long-term opportunities for our business. We believe that our superior order fill rates and deep vertical integration continue to enhance our competitive position. As orders come in from electrical contractors, our distributors can continue to depend on us for quick deliveries coast to coast. Our balance sheet remains very strong. We have no long-term debt, and our revolving line of credit is paid down to zero. In addition, we had $157.9 million in cash at the end of the quarter. We also declared a $0.02 cash dividend during the quarter.
Our two-phased expansion plan announced last year remains on schedule. The new service center opened seamlessly in mid-May and is fully operational today. Phase two, which is focused on repurposing our now vacated distribution center to expand manufacturing capacity and extend our market reach, is on schedule for an early 2022 opening.
We have been under construction since inception and we continue to grow today. The outstanding financial results through June 30th have fortified our already strong balance sheet and will continue to bolster cash reserves. Current market conditions have afforded us the opportunity to accelerate our capital expenditure plans and incrementally invest across our campus. We believe these investments will broaden our position as a low-cost manufacturer in the sector and further increase manufacturing capacity to accelerate growth. The incremental spending in 2021 through 2023 will expand vertical integration in our manufacturing processes to reduce costs as well as modernize select wire manufacturing facilities to increase capacity and efficiency. Capital expenditures are now expected to range from $150 – $170 million in 2021, $140 – $160 million in 2022, and $60 – $80 million in 2023. We expect to fund these investments with existing cash reserves and operating cash flows.
Our low-cost structure and strong balance sheet have allowed us the nimbleness to adapt quickly to changing market conditions, and we believe they are continuing to prove valuable now. We thank our employees and associates for their outstanding effort and our shareholders for their continued support.”
The health and safety of our employees and their families remain our top priority, and we are following CDC guidelines to maintain safe working conditions. The Company is unable to predict the impact that COVID-19 may have on our financial position and operating results in future periods. The duration or re-emergence of the outbreak and its long-term impact on our business remain uncertain.
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