Builders FirstSource Q2: EPS Beat, Lower Sales And $1B Stock Buyback & More

Builders FirstSource, Inc. BLDR shares are trading higher on Tuesday.

The company reported second-quarter adjusted earnings per share of $3.50, beating the street view of $3.02.

Quarterly sales of $4.456 billion missed the street view of $4.483 billion.

Net sales witnessed a 1.6% decrease, with core organic sales down 3.8% as Multi-Family continued to trend downward.

Gross profit margin fell 240 basis points to 32.8%, largely due to normalization effects in Multi-Family.

Adjusted EBITDA decreased by 12.9% to $669.7 million, driven by lower gross profit but partially offset by reduced operating expenses. The adjusted EBITDA margin declined 200 basis points to 15.0%, though it has stayed in the mid-teens or better for 13 consecutive quarters.

“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. 

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As of June-end, liquidity was approximately $1.7 billion, consisting of $1.6 billion in net borrowing availability under the revolving credit facility and $0.1 billion cash on hand.

Yesterday, the company’s Board of Directors authorized a new repurchase plan for up to $1.0 billion of its outstanding shares of common stock.

Year to date, the company has repurchased 5.9 million shares at an average price of $170.55 per share, totaling $1.0 billion. The company has reduced total shares outstanding by 4.4% in 2024.

In the second quarter, the company achieved about $37 million in productivity savings from operations and supply chain improvements. Year-to-date savings total approximately $77 million.

The company anticipates delivering between $90 million and $110 million in productivity savings for 2024.

Outlook: Builders FirstSource projects FY24 net sales between $16.4 billion and $17.2 billion, below the $17.631 billion estimate.

For FY24, the company expects a gross profit margin between 31.5% and 32.5%, adjusted EBITDA of $2.2 billion to $2.4 billion, and an adjusted EBITDA margin of 13.4% to 14.0%.

Price Action: BLDR shares are trading higher by 5.61% to $158.04 at last check Tuesday.

Photo by Etienne Girardet for Unsplash

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