BUSINESSWEEK'S HOT GROWTH COMPANIES

Hot Growth Special Report 2006 >

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Encore Wire (WIRE)

Copper prices soared in 2005, but that didn't close the curtains on Encore Wire. A Delaware corporation based in McKinney, Tex., the low-cost manufacturer of copper wire and cable saw the price of its chief commodity jump 28%. Despite higher production costs, net sales rose by 26%, pushing total revenues to $758 million. Thanks in part to a hungry housing market, average annual profits have risen 106% over the past three years. Encore's strategy: maintain sufficient inventories for lightning-fast delivery to customers, mostly wholesale electrical distributors that like to save money by keeping inventories low. When a 160,000 square feet expansion opens later this year, Encore will be ready for a second act.

Company Info

2005 Rank

NR

Market Value*
($ Millions)

971.9

Sales*
($ Millions)

872.9

Sales Growth
(3-yr. avg. annual)

40.2 %

Profits*
($ Millions)

65.2

Profit Growth
(3-yr. avg. annual)

106.0 %

Return on Inv. Capital (3-yr.)

13.3 %

Share Price
12-Mo. Hi/Lo

44/9

Share Price
As of 4/28/06

42

Return on Equity

28.6 %

P/E Ratio

15

No. of Employees

686

Industry Electrical Components & Equipment
CURRENT
MARKET INFO

WIRE >

COMPANY WEB SITE >
Location Mc Kinney, Tex.
Phone 972 562-9473
*Trailing 12 months
Stock price data as of 4/28/06
DATA: Standard & Poor's Compustat

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Company Snapshot

Encore Wire manufactures copper electrical building wire and cable in the U.S. The company supplies residential wire and commercial wire. Its residential wire product line, which consists primarily of NM-B cable, a nonmetallic sheathed cable used primarily as interior wiring in homes, apartments, and manufactured housing; and UF-B cable, an underground feeder cable used to conduct power underground to outside lighting and other applications remote from residential buildings. Both NM-B cable and UF-B cable are composed of two or three PVC insulated copper wire conductors, with or without an uninsulated ground wire, sheathed in a polyvinyl chloride jacket. Encore Wire's commercial product line consists primarily of THWN-2 cable, which is used principally as feeder, circuit, and branch wiring in commercial and industrial buildings. It is composed of a single conductor, either stranded or solid, and insulated with PVC, which is further coated with nylon. The company also purchases small quantities of other types of wire to resell to the customers that buy its products. Its sells its wire products to wholesale electrical distributors and retail home improvement centers primarily through manufacturers' representatives. Encore Wire was founded by Vincent A. Rego. The company was incorporated in 1989 and is based in McKinney, Tex.


Data provided by Capital IQ
 
Daniel L. Jones

Daniel L. Jones, 42

Chief Executive Officer, President and Director


Total Compensation*

$ 786,675

Total Options Value*

$ 4,922,830

* Fiscal Year 2005


Executive Bio

Daniel Jones has been a director of Encore Wire since 1994. Jones has been president since May, 1998, and chief operating officer since October, 1997. In May, 1997, Jones was named executive vice-president of Encore Wire. He previously held the position of vice-president, sales and marketing, from 1992 to May, 1997. He joined Encore in November, 1989.


Management Team

Key Executives

Daniel L. Jones; Frank J. Bilban

Board Directors

Thomas L. Cunningham; Scott D. Weaver; Joseph M. Brito; William R. Thomas; John H. Wilson; , Donald E. Courtney; Daniel L. Jones


Executive Data provided by Capital IQ