Core & Main Clocks 36% Sales Growth In Q2, Notes Margin Expansion

Core & Main Inc CNM reported second-quarter FY21 sales growth of 35.7% year-over-year to ~$1.29 billion, attributable to strong volume growth and price inflation, with price inflation representing approximately half of the net sales increase.
The gross margin expanded by 100 bps to 25.1%, reflecting sourcing and pricing improvements.
The operating income increased by 67.7% Y/Y to $99.8 million, and the margin expanded by 147 bps to 7.7%.
Adjusted EBITDA increased by 56.8% Y/Y to $155.2 million, and margin expanded by 160 bps to 12%.
Net Debt Leverage decreased to 3.3x as of August 1, 2021, compared with 5.2x as of May 2, 2021.
The company’s outlook for end markets remains positive, and it is confident to deliver above-market results for its stakeholders in 2021 and beyond.
Core & Main held $66.6 million of cash and cash equivalents as of August 1, 2021. Net cash used in operating activities year-to-date of $99.1 million, compared to cash generated of $93.2 million a year ago.
FY21 Outlook: Core & Main expects Adjusted EBITDA of $470 million - $510 million, representing a year-over-year increase of 37% - 49%.
Price Action: CNM shares are trading higher by 0.71% at $26.99 on the last check Tuesday.

Earnings Calendar