McKINNEY, Texas — Encore Wire Corporation today announced results for the first quarter of 2022.
Net sales for the first quarter ended March 31, 2022 were $723.1 million compared to $444.1 million for the first quarter of 2021. Copper unit volume, measured in pounds of copper contained in the wire sold, increased 8.6% in the first quarter of 2022 versus the first quarter of 2021.
Gross profit percentage for the first quarter of 2022 was 33.7% compared to 19.0% in the first quarter of 2021. The average selling price of wire per copper pound sold increased 43.3% in the first quarter of 2022 versus the first quarter of 2021, while the average cost of copper per pound purchased increased 19.3%.
Net income for the first quarter of 2022 was $161.5 million versus $41.2 million in the first quarter of 2021. Fully diluted net earnings per common share were $7.96 in the first quarter of 2022 versus $1.99 in the first quarter of 2021.
Aluminum wire represented 11.5% of our net sales in the quarter ended March 31, 2022. Aluminum wire volumes increased for the quarter ended March 31, 2022 compared to the comparative period in the prior year.
Commenting on the results, Daniel L. Jones, Chairman, President and Chief Executive Officer of Encore Wire Corporation, said, “The strong results for the first quarter ended March 31, 2022 mark the fourth consecutive quarter of elevated margins and spreads. Stable demand, coupled with developing global uncertainties and persistent tightness in the availability of certain raw materials, drove copper, aluminum, and other key raw material prices higher in the quarter. Because of this trend we were able to increase average sales prices for our products, keeping spreads strong throughout the first quarter of 2022. We still believe our one-campus model is a strategic competitive advantage in the market today, giving us unmatched flexibility to quickly pivot and adapt to ever-changing market dynamics. By continuing to execute on our core values of providing unbeatable customer service and high order fill rates, we were able to increase both copper and aluminum volumes shipped on a quarter basis over 2021 levels. Volumes shipped were also up over fourth quarter 2021 levels. We believe existing market conditions and the current outlook should support gross margin abatement continuing at a gradual pace.
Copper unit volumes increased 8.6% on a comparative quarter basis. Comex copper prices increased steadily throughout the first quarter along with increases in other key raw material costs. This upward volatility positively impacted and supported current market spreads. Copper spreads increased 86.1% on a comparative quarter basis.
We continue to believe Encore Wire remains well positioned to capture 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 including improving our position as a sustainable and environmentally responsible leader in our industry. 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 remains untapped. We had $466.1 million in cash at the end of the quarter. During the first quarter, we repurchased 500,917 shares of our common stock at an average price of $116.55, for a total cash outlay of $58.4 million. We also declared a $0.02 cash dividend during the quarter.
The new service center opened in mid-May 2021 and is fully operational today. The repurposing of our vacated distribution center to expand manufacturing capacity and extend our market reach will be completed in the second quarter of 2022.
The incremental investments announced in July 2021 continue in earnest, focused on broadening our position as a low-cost, sustainable manufacturer in the sector and increasing manufacturing capacity to drive growth. Capital spending in 2022 through 2024 will expand vertical integration in our manufacturing processes to reduce costs as well as modernize select wire manufacturing facilities to increase capacity and efficiency and improve our position as a sustainable and environmentally responsible leader in our industry. Total capital expenditures were $32 million in the first quarter of 2022 and $118 million for the full year 2021. We expect total capital expenditures to range from $150 – $170 million in 2022, $150 – $170 million in 2023, and $80 – $100 million in 2024. We expect to continue to fund these investments with existing cash reserves and operating cash flows.
Our low-cost structure and strong balance sheet have allowed us the flexibility 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, or any of the ongoing variants, 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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