On August 6, 2024, Builders FirstSource Inc (BLDR, Financial) released its 8-K filing for the second quarter ended June 30, 2024. Builders FirstSource Inc is a manufacturer and supplier of building materials, offering products such as factory-built roof and floor trusses, wall panels, stairs, vinyl windows, custom millwork, and trim. The company also provides construction-related services including professional installation, turn-key framing, and shell construction.
Performance Overview
Builders FirstSource Inc reported net sales of $4.5 billion for Q2 2024, a 1.6% decrease year-over-year, missing the analyst estimate of $4.48 billion. The decline was primarily driven by a 3.8% drop in core organic sales, particularly in the Multi-Family segment, which saw a 31.3% decline. This was partially offset by growth from acquisitions and Single-Family sales.
Financial Highlights
Gross profit for the quarter was $1.5 billion, down 8.3% from the previous year, with a gross profit margin of 32.8%, a decrease of 240 basis points. Net income fell 15.0% to $344.1 million, or $2.87 per diluted share, compared to $3.16 per diluted share in the prior year period. Adjusted EBITDA also decreased by 12.9% to $669.7 million, with an adjusted EBITDA margin of 15.0%, down 200 basis points.
“As we continue to operate in this complex environment, I am proud of our resilient second quarter results highlighted by maintaining a mid-teens EBITDA margin, which demonstrates the strength of our differentiated business model and the hard work of our extraordinary team members,” commented Dave Rush, CEO of Builders FirstSource.
Income Statement Summary
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Sales | $4.5 billion | $4.5 billion |
| Gross Profit | $1.5 billion | $1.6 billion |
| Net Income | $344.1 million | $404.6 million |
| Adjusted EBITDA | $669.7 million | $768.8 million |
Balance Sheet and Cash Flow
Cash provided by operating activities was $452.1 million, up $60.8 million from the prior year period. Free cash flow increased by 35.9% to $366.7 million. The company repurchased 5.8 million shares of common stock at an average price of $170.01, totaling $989.6 million.
Challenges and Strategic Initiatives
The company continues to face challenges in the Multi-Family segment and broader housing affordability issues. However, Builders FirstSource is focusing on value-added solutions and digital platform adoption to navigate these challenges.
“We were able to effectively navigate a softer-than-expected housing environment during the second quarter by leaning into the pillars of our strategy and operating model,” added Peter Jackson, CFO of Builders FirstSource.
Outlook
For the full year 2024, Builders FirstSource expects net sales to range between $16.4 billion and $17.2 billion, with an adjusted EBITDA between $2.2 billion and $2.4 billion. The company aims to deliver $90 million to $110 million in productivity savings for the year.
For more detailed financial information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from Builders FirstSource Inc for further details.
