After two fires in two months at Trex Co. Inc.'s manufacturing campus in Winchester, Va., the composite decking manufacturer is lowering first-quarter guidance and planning to offset lost production time.
The first incident occurred on Feb. 9 after equipment malfunctioned, causing a small fire on the roof of a building at the headquarters site, according to The Winchester Star.
Then, on March 13, a ceiling caught fire at Building 1 on the campus, the media outlet reported. When firefighters entered the facility, they reportedly saw high-voltage electrical lines on a scaffolding at least 20 feet high.
The cause of the fire remains under investigation, according to the local newspaper, which also reported that firefighters waited 30 minutes to an hour for the electrical utility to cut power to the building. The fire was fully extinguished about two hours after emergency crews arrived.
Frederick County Fire and Rescue Department Chief Steven Majchrzak told the local press that “firefighters showed great discipline in dealing with the electrical hazards present and in tracking down the spot fires over a large area of the facility.”
When firefighters cleared out, the scene was turned over to Trex's emergency response team, according to Trex President and CEO Bryan Fairbanks.
"Thanks to extensive safety training and fast action by our employees and area firefighters, we are pleased to report that no one was injured in the electrical fire that occurred recently at one of the manufacturing buildings in our Winchester, Va., complex," Fairbanks said in a March 22 news release.
Trex officials expect the latest fire to have a minimal effect on overall business, but they did scale back guidance for first-quarter sales, which they said Feb. 22 were on track to range from $235 million to $245 million, which would be year-over-year growth of 20 percent.
"Based on the projected production loss, we expect our first-quarter revenue will be on the lower end of the guidance provided in February at approximately $235 million, with production volume loss expected to be recovered during the second quarter," Fairbanks said.
The building's damaged electrical systems are being addressed with repairs expected to run through the end of March. During this time, production will continue as normal at the company's other manufacturing facilities in Virginia and Nevada.
In addition, the company's capacity expansion plan is moving ahead at the Virginia site, where Trex recently opened a new manufacturing plant to produce decking.
"Our success with the startup of lines in our new building is providing incremental capacity faster than planned, enabling us to make up the lost production," Fairbanks said. "All of the lines in the new building are expected to be fully operational approximately 30 days ahead of our announced end of second-quarter target."
In addition to the new Virginia facility, Trex also recently improved production capabilities and capacity at its manufacturing site in Nevada, where new lines began producing decking in June 2020.
In all, Trex says it has four production facilities for decking that will eventually increase production capacity by about 70 percent compared with 2019 levels.
Trex had another record year in 2020 with decking and commercial metal railing sales up 18 percent to $881 million.
Trex ranks No. 7 among North American pipe, profile and tubing manufacturers, according to Plastics News data, which is based on the company's 2019 decking sales of $694 million.