Quanex Building Products Corporation Fiscal 2011 Second Quarter Results

Loss From Continuing Operations of $0.04 Per Diluted Share

Loss Included $0.07 Per Diluted Share of Special Items

Integration of Edgetech on Schedule

End Markets Remained Weak

HOUSTON, June 13, 2011 (GLOBE NEWSWIRE) -- Quanex Building Products Corporation
(NYSE:NX), a leading manufacturer of engineered materials, components and
systems serving domestic and international window and door markets through its
Engineered Products and Aluminum Sheet Products groups, today released fiscal
2011 second quarter results for the period ending April 30, 2011. The company
reported a diluted loss from continuing operations of $0.04 per share in the
quarter that included the following special items: LIFO expense of $0.03; and
Edgetech transaction costs of $0.03. Diluted earnings from continuing operations
were $0.12 per share a year ago which included a bargained purchase gain of
$0.03 per dulited share and a LIFO expense of $0.02. Second quarter earnings
from continuing operations were down from a year ago primarily due to weaker
results at the Engineered Products group, which had both lower sales and higher
organic growth initiative expenses that will drive programs to enhance the
group's long term sales.

Engineered Products group (EPG) is focused on providing window and door
customers with fenestration components, products, and systems. Key end markets
are residential repair & remodeling (R&R) and new home construction. Second
quarter revenue was $82.5 million, which included one month of Edgetech sales of
$6.4 million, and was lower than a year ago as demand at that time benefitted
from two housing related tax credit programs. There were no similar credits this
quarter. Operating income of $1.9 million was down from a year ago due to lower
revenue and higher growth initiative costs of about $0.6 million. EPG's income
included one month's operating loss at Edgetech of $0.9 million. Those Edgetech
results were negatively impacted by a step-up in inventory expense related to
the purchase method of accounting of $0.9 million.

2nd 2nd
qtr qtr
2011 2010
----- -----
Net sales $82.5 $84.7
Operating income $1.9 $5.8
(in millions)

Compared to the sequential first quarter, EPG revenue and operating income was
down, as demand in the first quarter benefitted from the $1,500 energy efficient
window tax credit that expired on December 31, 2010. Quanex believes its
national customers bought ahead and built inventory to meet the expected rise in
demand the deadline created, and in turn, demand slowed in the second quarter as
excess inventory was worked down. Poor weather conditions also negatively
impacted EPG's demand as new home construction activities were delayed in some
geographic regions.

Quanex believes there is value in measuring its sales performance against an
industry index. In the case of EPG, the company compares its sales to U.S.
window shipments as reported by Ducker Worldwide, a market intelligence firm.
For the 12 months ended second quarter, EPG sales were on track with the
industry.

Edgetech Acquisition

With the purchase of Edgetech on March 31, its successful integration into EPG
remains a high priority and good progress was made in the first month. Teams
were assigned to this critical task and integration is on schedule. For the
second half of fiscal 2011, Edgetech's results are estimated to be: Sales of
about $45 million; depreciation & amortization of about $4 million; and
operating income of about $2 million. These second half results do not include
$2 million to $3 million of expected annualized synergies.

Quanex estimates a more normalized 12 month run rate for Edgetech, post the
step-up in inventory, of: Sales of about $80 million; depreciation &
amortization of about $8 million; and operating income of about $5 million.
These estimates do not include any synergies and are subject to change.

Aluminum Sheet Products group is a leading provider of aluminum sheet through
its Nichols Aluminum operation. Key end markets are residential repair &
remodeling (R&R) and new home construction. Shipped pounds, revenue and
operating income in the second quarter were 80 million pounds, $123.1 million
and $6.1 million, respectively. Revenue was better than a year ago due to higher
aluminum prices. Both pounds and operating income were lower compared to a year
ago due to customer restocking that was driven at the time by tax credits that
are no longer available. Operating income was further impacted by a product mix
change, which included more unpainted sheet sales that sell at a lower margin
than painted sheet. Nichols' spread (sales less material costs) was up 4% from
the year ago quarter due primarily to higher aluminum prices.

The Aluminum Association reported non-can sheet aluminum shipments in the second
quarter were up 4% from a year ago while Nichols Aluminum's second quarter
shipments of 80 million pounds were down 4% over the same period. Part of the
underperformance to the industry is attributed to relatively weak building and
construction demand in the quarter, where Nichols has a sizable presence,
compared to stronger distribution and transportation demand, where it has a
relatively small presence.

2nd 2nd
qtr qtr
2011 2010
------ ------
Net sales $123.1 $117.1
Operating income $6.1 $7.2
Shipped pounds 80 83
(in millions)

Compared to the sequential first quarter, Nichols Aluminum shipped pounds,
revenue and operating income were each better and reflected an improvement in
seasonal demand (Nichols typically leads EPG into the Spring building season)
and higher aluminum prices. However, spread was down 7% primarily because
unpainted sheet sales were a larger percentage of the overall sales mix.

Corporate and Other Items

Corporate expenses in the quarter were $10.3 million and included, in part, the
following items: Edgetech related transaction costs; ERP program costs; stock
based compensation expense; and LIFO expense that primarily reflect higher
aluminum prices at Nichols.

Cash Position

Quanex had a cash balance of $57.7 million and total debt outstanding stood at
$2.0 million at the end of the quarter. The company used $104.4 million to
acquire Edgetech and used $6.4 million to purchase the lineal extrusion assets
of Jeld-Wen's Yakima, WA facility. Cash used by operating activities from
continuing operations for the first half of 2011 was $5.4 million. The company's
$270 million revolving credit facility remained untapped, but due to the
facility's covenant requirements, the available capacity at quarter end was
$214.7 million. Future uses of cash could be to fund organic growth activities,
fund the common stock dividend, make acquisitions, and repurchase outstanding
shares. No stock was purchased this quarter.

2011 Business Outlook

The combination of weak GDP growth, high unemployment, a lack of housing related
tax incentives, a tight credit market, and a large inventory of homes available
for sale has created a challenging business environment this year. The growth in
the economy appears to have stalled, and in turn, the pace of the recovery in
residential housing activity has slowed from previous expectations. The company
is now anticipating reduced customer demand in the second half of 2011 compared
to its original outlook. Therefore, Engineered Products financial guidance for
2011 has been reduced.

Engineered Products now expects to earn about $30 million in 2011
(pre-Edgetech), down $5 million from previous guidance, compared to $34 million
it earned in 2010. EPG sales are now expected to be about flat to last year, not
higher, and as previously disclosed, operating expenses are expected to be
higher as the group continues to invest in long term growth initiatives.

Aluminum Sheet Products guidance remains unchanged. It expects to earn about $25
million in 2011 compared to $30 million last year. This estimate is based on
lower shipped pounds because Nichols did not see the same level of restocking
demand that was present in the first half of 2010 repeated in the first half of
2011.

Segment guidance for 2011 assumes no LIFO activity, and excludes estimated
corporate expenses of $26 million (pre-Edgetech transaction and integration
costs). Capital expenditures are estimated at $30 million (pre-Edgetech).
Depreciation & amortization expenses are expected to be $29 million
(pre-Edgetech). Corporate expenses and capital expenditures include $2.5 million
and $9 million, respectively, of costs associated with the launch of Quanex's
$30 million multiyear ERP program.

Organic Growth Initiatives

EPG's organic programs are focused on driving profitable growth through one
sales and marketing team, coupled with the engineering collaboration of its
family of businesses: Homeshield, Mikron, Truseal and Edgetech. Activities are
focused on both national and regional window and door companies. EPG is also
collectively working to develop new products and systems that provide its
customers with the latest innovations in energy efficiency.

EPG launched its E-commerce website "Screen It Again" this quarter. The website
gives retail customers the ability to purchase after-market, custom-sized
screens and screen components, and window grills. EPG's Homeshield division,
with decades of experience, will be producing these products.

Dividend Declared

The Board of Directors declared a quarterly cash dividend of $0.04 per share on
the company's common stock, payable June 30, 2011, to shareholders of record on
June 16, 2011.

Financial Statistics as of 04/30/11

Book value per common share: $11.62; Total debt to capitalization: 0.5%; Return
on invested capital: 2.9%; Actual number of common shares outstanding:
37,501,151.

Definitions

Book value per common share -- calculated as total stockholders' equity as of
balance sheet date divided by actual number of common shares outstanding;

Total debt to capitalization -- calculated as the sum of both the current and
long-term portion of debt, as of balance sheet date, divided by the sum of both
the current and long-term portion of debt plus total stockholders' equity as of
balance sheet date;

Return on invested capital -- calculated as the total of the prior 12 months net
income plus prior 12 months after-tax interest expense and capitalized interest,
the sum of which is divided by the trailing five quarters average total debt
(current and long term) and total stockholders' equity.

The Quanex Building Products Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=1117

Statements that use the words "estimated," "expect," "could," "should,"
"believe," "will," "might," or similar words reflecting future expectations or
beliefs are forward-looking statements. The forward-looking statements include,
but are not limited to, references to synergies derived from the acquisition of
Edgetech, future operating results and financial condition of Quanex and
Edgetech and future uses of cash. The statements in this release are based on
current expectations. Actual results or events may differ materially from this
release. Factors that could impact future results may include, without
limitation, the effect of both domestic and global economic conditions, the
impact of competitive products and pricing, and the availability and cost of raw
materials. For a more complete discussion of factors that may affect the
company's future performance, please refer to the company's 10-K filing on
December 20, 2010, under the Securities Exchange Act of 1934, in particular the
section titled, "Private Securities Litigation Reform Act" contained therein.

For additional information, please visit www.quanex.com

QUANEX BUILDING PRODUCTS CORPORATION
INDUSTRY SEGMENT INFORMATION
(In thousands)
(Unaudited)

Three months ended Six months ended
April 30, April 30,
----------------------- -----------------------

2011 2010 2011 2010
----------- ---------- ----------- ----------
Net Sales:
$ 82,493 $ 84,717 Engineered Products $ 166,504 $ 157,527

123,059 117,088 202,197 198,651
----------- ---------- Aluminum Sheet Products ----------- ----------
205,552 201,805 Building Products 368,701 356,178

(2,440) (2,419) (5,781) (5,370)
----------- ---------- Eliminations ----------- ----------

$ 203,112 $ 199,386 $ 362,920 $ 350,808
=========== ========== Net Sales =========== ==========

Operating Income (Loss):
$ 1,914 $ 5,760 Engineered Products $ 1,266 $ 9,838

6,058 7,232 6,609 10,866
----------- ---------- Aluminum Sheet Products ----------- ----------
7,972 12,992 Building Products 7,875 20,704

(10,257) (7,313) (17,826) (13,178)
----------- ---------- Corporate and Other ----------- ----------

$ (2,285) $ 5,679 Operating Income $ (9,951) $ 7,526
=========== ========== (Loss) =========== ==========

QUANEX BUILDING PRODUCTS CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

Three months ended Six months
ended
April 30, April
30,
-----------------------
-----------------------

2011 2010 2011
2010
----------- ---------- -----------
----------

$ 203,112 $ 199,386 Net sales $ 362,920
$ 350,808
Cost of sales (exclusive of items

175,512 167,626 shown separately below) 315,167
293,760
22,024 19,046 Selling, general and administrative 42,318
35,153

7,861 7,035 15,386
14,369
----------- ---------- Depreciation and amortization -----------
----------
(2,285) 5,679 Operating income (loss) (9,951)
7,526
(110) (103) Interest expense (231)
(227)

338 1,427 438
1,505
----------- ---------- Other, net -----------
----------
Income (loss) from continuing

operations

(2,057) 7,003 before income taxes (9,744)
8,804

668 (2,619) 3,627
(3,337)
----------- ---------- Income tax benefit (expense) -----------
----------

Income (loss) from continuing

(1,389) 4,384 operations (6,117)
5,467

-- (71) Income (loss) from discontinued (12)
(960)
----------- ---------- operations, net of taxes -----------
----------

$ (1,389) $ 4,313 $ (6,129)
$ 4,507
=========== ========== Net income (loss) ===========
==========

Basic earnings per common share:

Earnings (loss) from continuing

$ (0.04) $ 0.12 operations $ (0.16)
$ 0.15

-- -- Income (loss) from discontinued (0.01)
(0.03)
----------- ---------- operations -----------
----------

$ (0.04) $ 0.12 $ (0.17)
$ 0.12
----------- ---------- Basic earnings (loss) per share -----------
----------

Diluted earnings per common share:

Earnings (loss) from continuing

$ (0.04) $ 0.12 operations $ (0.16)
$ 0.14

-- (0.01) Income (loss) from discontinued (0.01)
(0.02)
----------- ---------- operations -----------
----------

$ (0.04) $ 0.11 $ (0.17)
$ 0.12
----------- ---------- Diluted earnings (loss) per share -----------
----------

Weighted average common shares

outstanding:

37,092 37,357 Basic 37,092
37,348
37,092 37,892 Diluted 37,092
37,835

QUANEX BUILDING PRODUCTS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)

April 30, October 31,
2011 2010
----------- -------------------------- -----------
Assets
$ 57,727 Cash and equivalents $ 187,178
99,286 Accounts receivable, net 87,007
68,567 Inventories 45,200
16,140 Deferred income taxes 10,547
Prepaid and other current
9,190 assets 8,229

Current assets of
-- discontinued operations 462
----------- -------------------------- -----------
250,910 Total current assets 338,623
Property, plant and
156,375 equipment, net 135,517
7,892 Deferred income taxes 30,563
69,785 Goodwill 25,189
97,404 Intangible assets, net 44,668

17,710 Other assets 16,690
----------- -------------------------- -----------

$ 600,076 Total assets $ 591,250
=========== ========================== ===========
Liabilities and
stockholders' equity
$ 84,183 Accounts payable $ 70,986
36,480 Accrued liabilities 43,447
3,504 Income taxes payable --
Current maturities of
351 long-term debt 327

Current liabilities of
-- discontinued operations 30
----------- -------------------------- -----------
Total current
124,518 liabilities 114,790
1,633 Long-term debt 1,616
Deferred pension and
3,637 postretirement benefits 3,667
Non-current environmental
11,430 reserves 12,027

23,113 Other liabilities 17,718
----------- -------------------------- -----------
164,331 Total liabilities 149,818

Total stockholders'
435,745 equity 441,432
----------- -------------------------- -----------

Total liabilities and
$ 600,076 stockholders' equity $ 591,250
=========== ========================== ===========

QUANEX BUILDING PRODUCTS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOW
(In thousands)
(Unaudited)

Six months ended
April 30,
----------------------

2011 2010
---------- ----------
Operating activities:
Net income (loss) $ (6,129) $ 4,507
(Income) loss from discontinued
operations 12 960

Adjustments to reconcile net income
(loss) to cash provided by (used for)
operating activities from continuing
operations:
Depreciation and amortization 15,420 14,404
Gain on bargain purchase -- (1,272)
Deferred income taxes (4,539) 2,363
Stock-based compensation 2,722 2,252

Changes in assets and liabilities, net
of effects from
acquisitions and dispositions:
Decrease (increase) in accounts
receivable (1,176) 743
Decrease (increase) in inventory (12,961) (2,536)
Decrease (increase) in other current
assets (1,095) (95)
Increase (decrease) in accounts
payable 6,097 2,307
Increase (decrease) in accrued
liabilities (7,675) 2,412
Increase (decrease) in income taxes
payable 460 12,005
Increase (decrease) in deferred
pension and postretirement benefits (29) 845

Other, net 3,556 1,706
---------- ----------
Cash provided by (used for) operating
activities from
continuing operations (5,337) 40,601
Cash provided by (used for) operating
activities from
discontinued operations (68) (361)
---------- ----------
Cash provided by (used for) operating
activities (5,405) 40,240
---------- ----------
Investing activities:
Acquisitions, net of cash acquired (110,845) (1,590)
Capital expenditures, net of
retirements (10,896) (7,404)
Proceeds from property insurance claim -- 105
Proceeds from executive life insurance 683 --

Other, net 75 --
---------- ----------
Cash provided by (used for) investing
activities from
continuing operations (120,983) (8,889)
Cash provided by (used for) investing
activities from
discontinued operations -- 90
---------- ----------
Cash provided by (used for) investing
activities (120,983) (8,799)
---------- ----------
Financing activities:
Repayments of long-term debt (23) (115)
Common stock dividends paid (3,001) (2,264)
Issuance of common stock from stock
option exercises,
including related tax benefits 1,048 364
Purchase of treasury stock (1,504) --

Other, net 392 (246)
---------- ----------
Cash provided by (used for) financing
activities from
continuing operations (3,088) (2,261)
Cash provided by (used for) financing
activities from
discontinued operations (392) 246
---------- ----------
Cash provided by (used for) financing
activities (3,480) (2,015)
---------- ----------
Effect of exchange rate changes on cash
and equivalents (43) 30
LESS: (Increase) decrease in cash and
equivalents from
discontinued operations 460 25
---------- ----------
Increase (decrease) in cash and
equivalents from
continuing operations (129,451) 29,481
Cash and equivalents at beginning of
period 187,178 123,499
---------- ----------

Cash and equivalents at end of period $ 57,727 $ 152,980
========== ==========

CONTACT: Financial Contact:
Jeff Galow
713-877-5327

Media Contact:
Valerie Calvert
713-877-5305