To our stockholders, customers and employees:
We at Simpson Manufacturing Co., Inc., through our subsidiary Simpson Strong-Tie Company Inc., have a clear mission: At Simpson Strong-Tie, we believe in doing what’s right for our people, customers and community. As the trusted brand and manufacturer for construction solutions, we thrive on helping customers solve problems every day. We are all committed to bringing added value and to exceeding expectations with our promise of “No Equal” performance. This mission drives us to perform at the highest level every day.
Guided by our mission, we are focused on strategic growth through diversification. We are achieving growth organically and through acquisitions that leverage our engineering, testing, manufacturing and distribution strengths. This growth has increased our product offering and revenue and continues to reduce our dependence on North American residential construction.
Capital Allocation Plan
Our capital allocation strategy is continually evaluated to ensure a balance between capital expenditures, acquisitions, dividends and share repurchases in order to create the most value for our stockholders.
2015 was a year of gradual yet steady growth. By staying focused on our long-range global strategy, our dedicated employees allowed us to reinforce our strong position across the construction markets we serve while expanding our branch presence and customer service. Our emphasis on lean initiatives enabled us to continue to reduce costs and improve efficiency across the company. Our operating expenses as a percentage of sales decreased by 0.8% over 2014. In March, we decided to close our sales offices in China, Dubai and Thailand due to continued losses in these operations. This decision was based on several factors, primarily the difficulty of differentiating our products and our brand in these markets, which sell predominantly on price. In July, we announced that we will be combining two leased chemical facilities into a newly acquired facility in West Chicago. We anticipate greater efficiencies with one chemical manufacturing facility, and the new location provides additional space for state-of-the art research and testing capabilities and for future growth. Product innovation remains an integral part of our business strategy and culture. In 2015, we launched more than a dozen new products across our various product lines including Connectors/Lateral Systems; Fasteners; Anchor Systems; Truss Plates and Software; and Repair, Protection and Strengthening Systems. These product lines continue to help us diversify and expand our presence across many construction markets. Our strong company culture, along with our talented and dedicated employees, is key to the success of our strategy. Our sales were up 5.6% in 2015. Our balance sheet is strong, and our quarterly dividend is $0.16 per share.
Going forward, our commitment to providing exceptional customer service will remain our top priority as we stay true to our strategy and core values while continuing to diversify and increase our product offering. We believe we are positioned to deliver growth well into the future.
Thank you for your ongoing support,
Chief Executive Officer