Owens Corning's Doors Segment Shines: $311M Contribution Powers 9% Revenue Growth In Q2

Owens Corning Inc. OC reported a 9% year-over-year growth in second-quarter fiscal 2024 net sales to $2.789 billion, beating the consensus of $2.760 billion.

Sales by segments: Composites $546 million (-12% Y/Y), Insulation $916 million (+1% Y/Y), and Roofing $1.1 billion (-2% Y/Y).

Doors, which reported for the period May 15 through June 30, generated net sales of $311 million.

Adjusted EPS was $4.64, up from $4.25 a year ago, above the consensus of $4.33.

Adjusted EBIT increased to $588 million from $534 million, with a 21% margin, flat YoY. Adjusted EBITDA rose 11.8% Y/Y to $742 million, and the margin expanded 70 bps to 26.6%.

Operating cash flow for the six months ended June 30 totaled $517 million, up from $330 million, and free cash flow stood at $208 million.

During the second quarter, the company returned $52 million to shareholders through a cash dividend.

“Moving forward, we remain committed to maintaining our investment grade balance sheet through a balanced capital allocation strategy that continues to return cash to shareholders and positions our company for long-term success,” commented Executive Vice President and Chief Financial Officer Todd Fister.

Q3 Outlook: The company expects overall performance to result in net sales growth of low 20%. This includes overall revenue for the legacy business in line with the third quarter of 2023, plus the addition of a full quarter of revenue for the Doors segment.

The enterprise is expected to generate an EBIT margin in the high teens and an EBITDA margin in the low 20% range.

2024 Outlook: Owens Corning currently expects general corporate expenses of $255 million-$265 million and capital additions of ~$650 million.

Price Action: OC shares are trading lower by 2.69% at $159.93 at the last check Tuesday.

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