Builders FirstSource (BLDR) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales were $4.5B, down 1.6% year-over-year, with core organic sales down 3.8% due to Multi-Family weakness, partially offset by acquisitions and Single-Family growth.

• Adjusted EBITDA was $670M, down 12.9% year-over-year, with a margin of 15.0%.

• Adjusted EPS was $3.50, down 10% year-over-year; net income was $344M, down from $405M.

• Value-added products represented 49% of Q2 net sales, reflecting strategic focus and recent acquisitions.

• Nearly $1B in share repurchases and $133M in acquisitions completed in Q2; new $1B buyback plan authorized.

Financial highlights

• Gross margin was 32.8% in Q2 2024, down from 35.2% a year ago, mainly due to normalization in Multi-Family.

• Free cash flow for Q2 was $367M, up 35.9% year-over-year; operating cash flow was $452M.

• Net income for Q2 was $344M, down from $405M in Q2 2023; diluted EPS was $2.87.

• Manufactured products sales declined 18.5% year-over-year, while lumber & sheet goods grew 12.7%.

• SG&A as a percentage of sales was 21.8% in Q2 2024, improved from 22.5% last year.

Outlook and guidance

• 2024 net sales guidance lowered to $16.4–$17.2B (prior: $17.5–$18.5B); adjusted EBITDA guidance reduced to $2.2–$2.4B.

• Adjusted EBITDA margin forecasted at 13.4%–14.0%; gross margin guidance at 31.5%–32.5%.

• Free cash flow for 2024 projected at $1.0–$1.2B; capex expected at $400–$500M.

• Q3 net sales expected at $4.3–$4.6B; Q3 adjusted EBITDA at $575–$625M.

• Single-Family starts projected up low-single digits, Multi-Family down 25–30%, R&R flat.