Q4 2025 Core & Main Inc Earnings Call Transcript
Key Points
- Core & Main Inc (CNM) delivered its 16th consecutive year of sales growth, achieving net sales of $7.65 billion in fiscal 2025.
- The company achieved 3% sales growth, with 5% growth when adjusted for one less selling week, driven by organic market share gains and acquisitions.
- Core & Main Inc (CNM) expanded its gross margin by 30 basis points year-over-year, reflecting higher private label penetration and disciplined purchasing and pricing execution.
- The company generated strong operating cash flow of $650 million, representing a conversion rate at the high end of their target range of 60% to 70% of adjusted EBITDA.
- Core & Main Inc (CNM) continues to invest in growth initiatives, including opening 10 new branches and planning to open a record 7 to 10 greenfield locations in fiscal 2026.
- Net sales in the fourth quarter decreased by 7% to $1.58 billion, partly due to one fewer selling week and severe winter weather affecting construction activity.
- The residential end market remains challenged, with expectations of low double-digit to mid-teens declines in the first half of fiscal 2026.
- Non-residential volumes were relatively flat, with softness in traditional commercial lab development activity offsetting growth in data centers and infrastructure projects.
- The company faces uncertainty in the private construction market due to geopolitical volatility, interest rate environment, and ongoing tariff uncertainties.
- Pricing was flat overall in fiscal 2025, with PVC pipe prices down 15%, creating a headwind for the first half of fiscal 2026.
Hello, and welcome to the Core & Main Q4 and full year 2025 earnings call. My name is Alex, and I'll be coordinating today's call. (Operator Instructions)
I'll now hand it over to Glenn Floyd, Director of Investor Relations, to begin. Please go ahead.
Good morning, and thank you for joining us. I'm Glenn Floyd, Director of Investor Relations at Core & Main. We appreciate you taking the time to be with us today for our fiscal 2025 fourth quarter and full year earnings call.
Joining me this morning are Mark Witkowski, our Chief Executive Officer; Robyn Bradbury, our Chief Financial Officer; and Brad Cowles, our President. Mark will start with the business update and review of our fiscal 2025 performance. Brad will then discuss the investments we are making to drive market share gains and margin expansion over the long term. Robyn will follow with a review of our financial results and outlook for fiscal 2026. We will then open the line for questions, and Mark
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