Installed Building Products, Inc. (the "Company" or "IBP")
(NYSE: IBP), an industry-leading installer of insulation and
complementary building products, today announced results for the
second quarter ended June 30, 2024.
Second Quarter 2024 Highlights (Comparisons are to Prior Year
Period)
- Net revenue increased 6.6% to $737.6 million
- Installation revenue increased 7.0% to $697.3 million, as
single-family and multi-family sales growth combined with sales
from IBP's recent acquisitions
- Other revenue, net of eliminations, which includes IBP’s
manufacturing and distribution operations, increased to $40.3
million from $40.2 million
- Net income increased 5.8% to a second quarter record of $65.2
million
- Adjusted EBITDA* increased 6.3% to a second quarter record of
$129.8 million
- Adjusted EBITDA, net of dispositions* was $136.6 million
- Net income per diluted share increased 5.5% to a second quarter
record of $2.30
- Adjusted net income* increased 8.8% to a second quarter record
of $80.5 million, or $2.84 per diluted share
- Adjusted net income, net of dispositions* was $85.7 million, or
$3.02 per diluted share
- At June 30, 2024, IBP had $380.3 million in cash and cash
equivalents
- Repurchased approximately 215 thousand shares of common stock
at a total cost of $46 million, including commissions
- Declared second quarter dividend of $0.35 per share that was
paid to shareholders on June 30, 2024
Recent Developments
- IBP’s Board of Directors declared the third quarter regular
cash dividend of $0.35 per share
- In July 2024, acquired Euroview Enterprises, LLC, an installer
of a diverse set of building products generating annual revenue of
approximately $20 million
“IBP reported another strong quarter of growth and profitability
highlighting the value our talented and committed teams provide to
our residential and commercial customers. Growth across our core
end markets remained positive during the second quarter as builders
continued to meet new construction home demand, helping IBP achieve
another quarter of record sales and earnings,” stated Jeff Edwards,
Chairman and Chief Executive Officer.
“Our strategic focus on ensuring we provide a high quality,
valuable service to our customers continues to support robust
profit margins and strong operating cash flow. With our robust
balance sheet, we remain well-positioned to continue to execute on
our growth-oriented acquisition strategy. Year-to-date, we have
acquired over $50 million of annual revenue and expect 2024 to be a
solid year of acquisition activity. In addition, during the second
quarter we repurchased $46 million of our common stock, reflecting
our commitment to return capital to shareholders,” continued Mr.
Edwards.
“Given our current end market exposure, our outlook for 2024
remains positive and we continue to focus on both organic growth
and accretive acquisitions in order to create value for our
shareholders over the long term,” concluded Mr. Edwards.
Acquisition Update
IBP continues to prioritize profitable growth through its proven
strategy of acquiring well-run installers of insulation and
complementary building products. To date in 2024, IBP has acquired
over $50 million of annual revenue.
During the 2024 second quarter and in July 2024, IBP completed
the following acquisitions:
- In April 2024, IBP acquired Trade Partners, Inc., a North
Carolina-based installer of insulation and numerous complementary
products including, shower doors, closet shelving, mirrors,
gutters, window blinds with single-family and multi-family
customers generating annual revenue of over $6 million.
- In June 2024, IBP acquired Thrice Energy Solutions, LLC, an
Oklahoma-based installer of insulation, and Gutter Pro Enterprises,
Inc., a Massachusetts-based installer of gutters, which represent
combined revenue of approximately $14 million.
- In July 2024, IBP acquired Euroview Enterprises, LLC, Contract
Mirror and Supply Co., and CLM Solutions, LLC (collectively
“Euroview”), an Illinois-based residential and commercial installer
of building products with exposure to key construction markets in
the Midwest. Euroview has combined annual revenue of approximately
$20 million.
2024 Third Quarter Cash Dividend
IBP’s Board of Directors has approved the Company’s quarterly
cash dividend of $0.35 per share, payable on September 30, 2024, to
stockholders of record on September 15, 2024. The third quarter
regular cash dividend represents a 6% increase from last year’s
third quarter cash dividend payment.
Share Repurchases
During the three months ended June 30, 2024, IBP repurchased
approximately 215 thousand shares of its common stock at a total
cost of $46 million, including commissions. At June 30, 2024, the
Company had over $250 million available under its stock repurchase
program.
Second Quarter 2024 Results Overview
For the second quarter of 2024, net revenue was $737.6 million,
an increase of 6.6% from $692.1 million for the second quarter of
2023. On a consolidated same branch basis, net revenue increased
4.8% from the prior year quarter, as growth in our residential end
markets more than offset headwinds in our commercial end market.
Residential sales growth within the Company's Installation segment
was up 7.3% on a same branch basis in the quarter, both
single-family same branch sales and multi-family same branch sales
increased from the prior year quarter.
Gross profit improved 8.1% to $251.4 million from $232.5 million
in the prior year quarter. Gross profit and adjusted gross profit*
as a percent of net revenue were both 34.1%, up from 33.6% in the
same period last year. Adjusted gross profit primarily adjusts for
the Company’s share-based compensation expense.
Selling and administrative expense, as a percent of total
revenue, was 19.1% compared to 18.6% in the prior year quarter.
Adjusted selling and administrative expense*, as a percent of net
revenue, was 18.5% compared to 17.9% in the prior year quarter.
Net income was $65.2 million, or $2.30 per diluted share,
compared to $61.6 million, or $2.18 per diluted share in the prior
year quarter. Net profit margin for the second quarter was 8.8%
compared to 8.9% in the prior year quarter. Adjusted net income*
was $80.5 million, or $2.84 per diluted share, compared to $74.0
million, or $2.62 per diluted share in the prior year quarter.
Adjusted net income margin* for the second quarter was 10.9%
compared to 10.7% in the prior year quarter. Adjusted net income
accounts for the impact of non-core items in both periods,
including an addback for non-cash amortization expense related to
acquisitions.
EBITDA* was $119.6 million, a 2.6% increase from $116.6 million
in the prior year quarter. Adjusted EBITDA* was $129.8 million, a
6.3% increase from $122.1 million in the prior year quarter,
representing an adjusted EBITDA margin* of 17.6% for both quarters.
Adjusted EBITDA, net of dispositions* was $136.6 million,
representing an adjusted EBITDA margin, net of dispositions* of
18.5%.
Conference Call and Webcast
The Company will host a conference call and webcast on August 1,
2024 at 10:00 a.m. Eastern Time to discuss these results. To
participate in the call, please dial 877-407-0792 (domestic) or
201-689-8263(international). The live webcast will be available at
www.installedbuildingproducts.com in the investor relations
section. A replay of the conference call will be available through
September 1, 2024, by dialing 844-512-2921 (domestic) or
412-317-6671 (international) and entering the passcode
13746752.
About Installed Building Products
Installed Building Products, Inc. is one of the nation's largest
new residential insulation installers and is a diversified
installer of complementary building products, including
waterproofing, fire-stopping, fireproofing, garage doors, rain
gutters, window blinds, shower doors, closet shelving and mirrors
and other products for residential and commercial builders located
in the continental United States. The Company manages all aspects
of the installation process for its customers, from direct purchase
and receipt of materials from national manufacturers to its timely
supply of materials to job sites and quality installation. The
Company offers its portfolio of services for new and existing
single-family and multi-family residential and commercial building
projects in all 48 continental states and the District of Columbia
from its national network of over 250 branch locations.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws, including with respect
to the housing market and the commercial market, our operations,
industry and economic conditions, our financial and business model,
payment of dividends, the demand for our services and product
offerings, expansion of our national footprint and end markets,
diversification of our products, our ability to grow and strengthen
our market position, our ability to pursue and integrate
value-enhancing acquisitions and the expected amount of acquired
revenue, our ability to improve sales and profitability, and
expectations for demand for our services and our earnings.
Forward-looking statements may generally be identified by the use
of words such as "anticipate," "believe," "expect," "intends,"
"plan," and "will" or, in each case, their negative, or other
variations or comparable terminology. These forward-looking
statements include all matters that are not historical facts. By
their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future. Any
forward-looking statements that we make herein and in any future
reports and statements are not guarantees of future performance,
and actual results may differ materially from those expressed in or
suggested by such forward-looking statements as a result of various
factors, including, without limitation, general economic and
industry conditions; increases in mortgage interest rates and
rising home prices; inflation and interest rates; the material
price and supply environment; the timing of increases in our
selling prices; the risk that the Company may reduce, suspend or
eliminate dividend payments in the future; and the factors
discussed in the “Risk Factors” section of the Company’s Annual
Report on Form 10-K for the year ended December 31, 2023, as the
same may be updated from time to time in our subsequent filings
with the Securities and Exchange Commission. In addition, any
future declaration of dividends will be subject to the final
determination of our Board of Directors. Any forward-looking
statement made by the Company in this press release speaks only as
of the date hereof. New risks and uncertainties arise from time to
time, and it is impossible for the Company to predict these events
or how they may affect it. The Company has no obligation, and does
not intend, to update any forward-looking statements after the date
hereof, except as required by federal securities laws.
*Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance
with U.S. generally accepted accounting principles (“GAAP”), this
press release contains the non-GAAP financial measures of EBITDA,
Adjusted EBITDA, Adjusted EBITDA, net of dispositions, Adjusted
EBITDA margin (i.e., Adjusted EBITDA divided by net revenue),
Adjusted Net Income, Adjusted Net Income, net of dispositions,
Adjusted Net Income per diluted share, Adjusted Gross Profit and
Adjusted Selling and Administrative expense. The reasons for the
use of these measures, reconciliations of EBITDA, Adjusted EBITDA,
Adjusted Net Income, Adjusted Net Income per diluted share,
Adjusted Gross Profit, and Adjusted Selling and Administrative
expense to the most directly comparable GAAP measures and other
information relating to these measures are included below following
the unaudited condensed consolidated financial statements. Non-GAAP
financial measures have limitations as analytical tools and should
not be considered in isolation or as a substitute for IBP’s
financial results prepared in accordance with GAAP.
During the three months ended June 30, 2024, we decided to wind
down the operations of a single new commercial end market-oriented
branch that focused on the installation of a non-core end product,
due to shifting market conditions, an unfavorable contract
settlement, and sub-standard operating performance. All
dispositions figures reflect the results of this single branch. All
net of dispositions figures reflect the exclusion of the results of
this single branch.
INSTALLED BUILDING PRODUCTS,
INC.
CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS AND COMPREHENSIVE INCOME
(unaudited, in millions, except
share and per share amounts)
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net revenue
$
737.6
$
692.1
$
1,430.5
$
1,351.4
Cost of sales
486.2
459.6
944.6
908.5
Gross profit
251.4
232.5
485.9
442.9
Operating expenses
Selling
34.5
32.9
67.8
65.5
Administrative
106.7
96.0
209.3
185.5
Asset impairment
4.9
—
4.9
—
Amortization
10.5
11.3
21.2
22.7
Operating income
94.8
92.3
182.7
169.2
Other expense, net
Interest expense, net
8.2
9.8
20.1
19.5
Other (income)
(0.1
)
(0.2
)
(0.5
)
(0.4
)
Income before income taxes
86.7
82.7
163.1
150.1
Income tax provision
21.5
21.1
42.0
39.2
Net income
$
65.2
$
61.6
$
121.1
$
110.9
Other comprehensive income (loss), net of
tax:
Net change on cash flow hedges, net of tax
(provision) benefit of $- and $(1.9) for the three months ended
June 30, 2024 and 2023, respectively, and $(1.7) and $0.3 for the
six months ended June 30, 2024 and 2023, respectively
—
5.4
4.7
(0.9
)
Comprehensive income
$
65.2
$
67.0
$
125.8
$
110.0
Earnings Per Share:
Basic
$
2.32
$
2.19
$
4.30
$
3.94
Diluted
$
2.30
$
2.18
$
4.27
$
3.92
Weighted average shares outstanding:
Basic
28,174,677
28,174,279
28,173,061
28,125,251
Diluted
28,317,801
28,273,334
28,351,401
28,276,049
Cash dividends declared per share
$
0.35
$
0.33
$
2.30
$
1.56
INSTALLED BUILDING PRODUCTS,
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited, in millions, except
share and per share amounts)
June 30,
December 31,
2024
2023
ASSETS
Current assets
Cash and cash equivalents
$
380.3
$
386.5
Accounts receivable (less allowance for
credit losses of $11.4 and $11.2 at June 30, 2024 and December 31,
2023, respectively)
439.6
423.3
Inventories
175.6
162.8
Prepaid expenses and other current
assets
91.9
97.4
Total current assets
1,087.4
1,070.0
Property and equipment, net
154.8
137.2
Operating lease right-of-use assets
86.1
78.1
Goodwill
406.1
398.8
Customer relationships, net
170.7
179.6
Other intangibles, net
85.9
89.1
Other non-current assets
34.2
28.5
Total assets
$
2,025.2
$
1,981.3
LIABILITIES AND STOCKHOLDER'S
EQUITY
Current liabilities
Current maturities of long-term debt
$
31.8
$
32.2
Current maturities of operating lease
obligations
30.6
28.3
Current maturities of finance lease
obligations
2.8
2.7
Accounts payable
157.5
158.6
Accrued compensation
56.6
59.6
Other current liabilities
73.3
65.0
Total current liabilities
352.6
346.4
Long-term debt
844.0
835.1
Operating lease obligations
55.3
49.9
Finance lease obligations
6.7
6.6
Deferred income taxes
25.9
24.5
Other long-term liabilities
55.4
48.5
Total liabilities
1,339.9
1,311.0
Commitments and contingencies (Note
16)
Stockholders’ equity
Preferred Stock; $0.01 par value:
5,000,000 authorized and 0 shares issued and outstanding at June
30, 2024 and December 31, 2023, respectively
—
—
Common stock; $0.01 par value: 100,000,000
authorized, 33,706,380 and 33,587,701 issued and 28,234,462 and
28,367,338 shares outstanding at June 30, 2024 and December 31,
2023, respectively
0.3
0.3
Additional paid in capital
252.9
244.7
Retained earnings
749.6
693.8
Treasury stock; at cost: 5,471,918 and
5,220,363 shares at June 30, 2024 and December 31, 2023,
respectively
(355.9
)
(302.2
)
Accumulated other comprehensive income
38.4
33.7
Total stockholders’ equity
685.3
670.3
Total liabilities and stockholders’
equity
$
2,025.2
$
1,981.3
INSTALLED BUILDING PRODUCTS,
INC.
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
(unaudited, in millions)
Six months ended June 30,
2024
2023
Cash flows from operating
activities
Net income
$
121.1
$
110.9
Adjustments to reconcile net income to net
cash provided by operating activities
Depreciation and amortization of property
and equipment
28.0
25.4
Amortization of operating lease
right-of-use assets
16.3
14.4
Amortization of intangibles
21.2
22.7
Amortization of deferred financing costs
and debt discount
0.8
1.0
Provision for credit losses
3.1
3.2
Write-off of debt issuance costs
1.1
—
Gain on sale of property and equipment
(1.2
)
(1.2
)
Non-cash stock compensation
8.7
7.1
Asset impairment
4.9
—
Other, net
(6.8
)
(5.5
)
Changes in assets and liabilities,
excluding effects of acquisitions
Accounts receivable
(18.4
)
(17.5
)
Inventories
(11.4
)
14.7
Other assets
5.1
4.9
Accounts payable
(1.6
)
(16.3
)
Income taxes receivable/payable
(0.6
)
(4.8
)
Other liabilities
(6.5
)
(20.9
)
Net cash provided by operating
activities
163.8
138.1
Cash flows from investing
activities
Purchases of property and equipment
(42.6
)
(28.3
)
Acquisitions of businesses, net of cash
acquired
(22.7
)
(40.2
)
Proceeds from sale of property and
equipment
1.8
1.5
Settlements with interest rate swap
counterparties
9.0
7.8
Other
(0.7
)
(0.3
)
Net cash used in investing activities
$
(55.2
)
$
(59.5
)
Six months ended June 30,
2024
2023
Cash flows from financing
activities
Proceeds from Term Loan
$
142.9
$
—
Payments on Term Loan
(134.2
)
(2.5
)
Proceeds from vehicle and equipment notes
payable
15.0
18.3
Debt issuance costs
(1.5
)
—
Principal payments on long-term debt
(15.5
)
(14.8
)
Principal payments on finance lease
obligations
(1.5
)
(1.4
)
Dividends paid
(65.2
)
(44.5
)
Acquisition-related obligations
(1.0
)
(2.2
)
Repurchase of common stock
(45.7
)
—
Surrender of common stock awards by
employees
(8.1
)
(5.9
)
Net cash used in financing activities
(114.8
)
(53.0
)
Net change in cash and cash
equivalents
(6.2
)
25.6
Cash and cash equivalents at beginning of
period
386.5
229.6
Cash and cash equivalents at end of
period
$
380.3
$
255.2
Supplemental disclosures of cash flow
information
Net cash paid during the period for:
Interest
$
21.9
$
20.8
Income taxes, net of refunds
42.7
44.1
Supplemental disclosure of non-cash
activities
Right-of-use assets obtained in exchange
for operating lease obligations
$
23.6
$
14.7
Property and equipment obtained in
exchange for finance lease obligations
1.8
2.2
Seller obligations in connection with
acquisition of businesses
2.2
7.7
Unpaid purchases of property and equipment
included in accounts payable
2.7
4.9
INSTALLED BUILDING PRODUCTS,
INC.
SEGMENT INFORMATION
(unaudited, in millions)
Information on Segments
Our Company has three operating segments
consisting of Installation, Distribution and Manufacturing. The
Other category reported below reflects the operations of our
Distribution and Manufacturing operating segments.
Three months ended June 30,
2024
Six months ended June 30,
2024
Installation
Other
Eliminations
Consolidated
Installation
Other
Eliminations
Consolidated
Revenue
$
697.3
$
44.0
$
(3.7
)
$
737.6
$
1,353.2
$
84.3
$
(7.0
)
$
1,430.5
Cost of sales (1)
443.1
32.5
(2.8
)
472.8
862.4
61.0
(5.1
)
918.3
Segment gross profit
$
254.2
$
11.5
$
(0.9
)
$
264.8
$
490.8
$
23.3
$
(1.9
)
$
512.2
Segment gross profit percentage
36.5
%
26.2
%
25.8
%
35.9
%
36.3
%
27.7
%
27.5
%
35.8
%
Three months ended June 30,
2023
Six months ended June 30,
2023
Installation
Other
Eliminations
Consolidated
Installation
Other
Eliminations
Consolidated
Revenue
$
651.9
$
42.3
$
(2.1
)
$
692.1
$
1,274.6
$
81.0
$
(4.2
)
$
1,351.4
Cost of sales (1)
418.6
30.3
(1.5
)
447.4
829.0
58.8
(3.3
)
884.5
Segment gross profit
$
233.3
$
12.0
$
(0.6
)
$
244.7
$
445.6
$
22.2
$
(0.9
)
$
466.9
Segment gross profit percentage
35.8
%
28.2
%
22.7
%
35.3
%
35.0
%
27.4
%
20.3
%
34.5
%
(1)
Cost of sales included in segment gross
profit is exclusive of depreciation and amortization for the three
and six months ended June 30, 2024 and 2023.
The reconciliation between consolidated
segment gross profit for each period as shown in the tables above
to consolidated income before income taxes as follows:
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Segment gross profit - consolidated
$
264.8
244.7
512.2
$
466.9
Depreciation and amortization (1)
13.4
12.2
26.3
24.0
Gross profit, as reported
251.4
232.5
485.9
442.9
Operating expenses
156.6
140.2
303.2
273.7
Operating income
94.8
92.3
182.7
169.2
Other expense, net
8.1
9.6
19.6
19.1
Income before income taxes
$
86.7
82.7
163.1
$
150.1
(1)
Depreciation and amortization is excluded
from segment gross profit for the three and six months ended June
30, 2024 and 2023.
INSTALLED BUILDING PRODUCTS,
INC.
REVENUE BY END MARKET
(unaudited, in millions)
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Installation:
Residential new construction
$
542.4
74
%
$
495.7
71
%
$
1,045.2
73
%
$
970.8
72
%
Repair and remodel
42.5
6
%
38.9
6
%
82.6
6
%
76.6
5
%
Commercial
112.4
15
%
117.3
17
%
225.4
16
%
227.2
17
%
Net revenue, Installation
697.3
95
%
651.9
94
%
1,353.2
95
%
1,274.6
94
%
Other
40.3
5
%
40.2
6
%
77.3
5
%
76.8
6
%
Net revenue, as reported
$
737.6
100
%
$
692.1
100
%
$
1,430.5
100
%
$
1,351.4
100
%
Reconciliation of Non-GAAP Financial Measures
EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net
Income, Adjusted Gross Profit and Adjusted Selling and
Administrative Expense measure performance by adjusting GAAP net
income, EBITDA, gross profit and selling and administrative
expense, respectively, for certain income or expense items that are
not considered part of our core operations. We believe that the
presentation of these measures provides useful information to
investors regarding our results of operations because it assists
both investors and us in analyzing and benchmarking the performance
and value of our business.
We believe the Adjusted EBITDA measure is useful to investors
and us as a measure of comparative operating performance from
period to period as it measures our changes in pricing decisions,
cost controls and other factors that impact operating performance,
and removes the effect of our capital structure (primarily interest
expense), asset base (primarily depreciation and amortization),
items outside our control (primarily income taxes) and the
volatility related to the timing and extent of other activities
such as asset impairments and non-core income and expenses.
Accordingly, we believe that this measure is useful for comparing
general operating performance from period to period. In addition,
we use various EBITDA-based measures in determining the achievement
of awards under certain of our incentive compensation programs.
Other companies may define Adjusted EBITDA differently and, as a
result, our measure may not be directly comparable to measures of
other companies. In addition, Adjusted EBITDA may be defined
differently for purposes of covenants contained in our revolving
credit facility or any future facility.
Although we use the Adjusted EBITDA measure to assess the
performance of our business, the use of the measure is limited
because it does not include certain material expenses, such as
interest and taxes, necessary to operate our business. Adjusted
EBITDA should be considered in addition to, and not as a substitute
for, GAAP net income as a measure of performance. Our presentation
of this measure should not be construed as an indication that our
future results will be unaffected by unusual or non-recurring
items. This measure has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of our results as reported under GAAP. Because of these
limitations, this measure is not intended as an alternative to net
income as an indicator of our operating performance, as an
alternative to any other measure of performance in conformity with
GAAP or as an alternative to cash flow provided by operating
activities as a measure of liquidity. You should therefore not
place undue reliance on this measure or ratios calculated using
this measure.
We also believe the Adjusted Net Income measure is useful to
investors and us as a measure of comparative operating performance
from period to period as it measures our changes in pricing
decisions, cost controls and other factors that impact operating
performance, and removes the effect of certain non-core items such
as discontinued operations, acquisition related expenses,
amortization expense, the tax impact of these certain non-core
items, and the volatility related to the timing and extent of other
activities such as asset impairments and non-core income and
expenses. To make the financial presentation more consistent with
other public building products companies, beginning in the fourth
quarter 2016 we included an addback for non-cash amortization
expense related to acquisitions. Accordingly, we believe that this
measure is useful for comparing general operating performance from
period to period. Other companies may define Adjusted Net Income
differently and, as a result, our measure may not be directly
comparable to measures of other companies. In addition, Adjusted
Net Income may be defined differently for purposes of covenants
contained in our revolving credit facility or any future
facility.
INSTALLED BUILDING PRODUCTS,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
ADJUSTED NET INCOME
CALCULATIONS
(unaudited, in millions, except
share and per share amounts)
The tables below reconcile Adjusted Net
Income, Adjusted Net Income, net of dispositions, and Adjusted Net
Loss, dispositions to the most directly comparable GAAP financial
measure, net income, for the periods presented therein. We have
included Adjusted Net Income, net of dispositions, in this press
release because it is a key measure used by our management team to
understand the operating performance and profitability of our
business. During the three months ended June 30, 2024, we decided
to wind down the operations of a single new commercial end
market-oriented branch that focused on the installation of a
non-core end product, due to shifting market conditions, an
unfavorable contract settlement, and sub-standard operating
performance. Accordingly, we believe that excluding the financial
results of this branch from our typical Adjusted Net Income measure
of profitability provides useful insight and metrics relevant to
understanding and evaluating the results of our ongoing operations.
The Adjusted Net Loss, dispositions line item included below
represents the Adjusted Net Loss of this single branch.
Per share figures may reflect rounding
adjustments and consequently totals may not appear to sum.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net income, as reported
$
65.2
$
61.6
$
121.1
$
110.9
Adjustments for adjusted net income
Share-based compensation expense
4.7
3.7
8.7
7.1
Acquisition related expenses
0.6
0.5
1.1
1.1
Amortization expense (1)
10.5
11.3
21.2
22.7
Legal Reserve
—
1.3
—
1.3
Loan refinancing expenses (2)
—
—
4.1
—
Asset impairment (3)
4.9
—
4.9
—
Tax impact of adjusted items at a
normalized tax rate (4)
(5.4
)
(4.4
)
(10.4
)
(8.4
)
Adjusted net income
$
80.5
$
74.0
$
150.7
$
134.7
Less: Adjusted net loss, dispositions
(5)
(5.2
)
(0.6
)
(6.6
)
(0.6
)
Adjusted net income, net of
dispositions
$
85.7
$
74.6
$
157.3
$
135.3
Weighted average shares outstanding
(diluted)
28,317,801
28,273,334
28,351,401
28,276,049
Diluted net income per share, as
reported
$
2.30
$
2.18
$
4.27
$
3.92
Adjustments for adjusted net income, net
of tax impact, per diluted share (6)
0.54
0.44
1.05
0.84
Diluted adjusted net income per share, as
reported
$
2.84
$
2.62
$
5.32
$
4.76
Less: Diluted adjusted net loss,
dispositions, net of tax impact, per diluted share (5)
(0.18
)
(0.02
)
(0.23
)
(0.02
)
Diluted adjusted net income, net of
dispositions per share
$
3.02
$
2.64
$
5.55
$
4.78
(1)
Addback of all non-cash amortization
resulting from business combinations.
(2)
Includes $1.1 million of non-cash
write-off of capitalized loan expense and $3.0 million of cash paid
to third parties in connection with loan refinancing for the six
months ended June 30, 2024.
(3)
During the three and six months ended June
30, 2024, we recognize intangible and asset impairment charges for
a combined amount of $4.9 million related to winding down the
operations of a branch that installs one of our non-core building
products.
(4)
Normalized effective tax rate of 26.0%
applied to periods presented.
(5)
Represents Adjusted net loss and diluted
adjusted net loss of a single branch. Please see preceding
paragraph at the beginning of this section for additional
information.
(6)
Includes adjustments related to the items
noted above, net of tax.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net loss, dispositions, as reported
$
(8.9
)
$
(0.7
)
$
(10.4
)
$
(0.7
)
Amortization expense
0.1
0.1
0.2
0.2
Asset impairment (1)
4.9
—
4.9
—
Tax impact of adjusted items at a
normalized tax rate
(1.3
)
—
(1.3
)
(0.1
)
Adjusted net loss, dispositions (2)
$
(5.2
)
$
(0.6
)
$
(6.6
)
$
(0.6
)
(1)
During the three and six months ended June
30, 2024, we recognized intangible and asset impairment charges for
a combined amount of $4.9 million related to winding down the
operations of a branch that installs one of our non-core building
products.
(2)
Represents Adjusted net loss of a single
branch. Please see preceding paragraph at the beginning of this
section for additional information.
INSTALLED BUILDING PRODUCTS,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
ADJUSTED GROSS PROFIT
CALCULATIONS
(unaudited, in millions)
The table below reconciles Adjusted Gross
Profit to the most directly comparable GAAP financial measure,
gross profit, for the periods presented therein.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Gross profit
$
251.4
$
232.5
$
485.9
$
442.9
Share-based compensation expense
0.3
0.2
0.6
0.4
Adjusted gross profit
$
251.7
$
232.7
$
486.5
$
443.3
Gross profit margin
34.1
%
33.6
%
34.0
%
32.8
%
Adjusted gross profit margin
34.1
%
33.6
%
34.0
%
32.8
%
INSTALLED BUILDING PRODUCTS,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
ADJUSTED SELLING AND
ADMINISTRATIVE EXPENSE CALCULATIONS
(unaudited, in millions)
The table below reconciles Adjusted
Selling and Administrative to the most directly comparable GAAP
financial measure, selling and administrative, for the periods
presented therein.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Selling expense
$
34.5
$
32.9
$
67.8
$
65.5
Administrative expense
106.7
96.0
209.3
185.5
Selling and Administrative expense, as
reported
141.2
128.9
277.1
251.0
Share-based compensation expense
4.4
3.4
8.2
6.7
Acquisition related expenses
0.6
0.5
1.1
1.1
Legal reserve
—
1.3
—
1.3
Adjusted Selling and Administrative
expense
$
136.2
$
123.7
$
267.8
$
241.9
Selling and Administrative expense - %
Total revenue
19.1
%
18.6
%
19.4
%
18.6
%
Adjusted Selling and Administrative
expense - % Total revenue
18.5
%
17.9
%
18.7
%
17.9
%
INSTALLED BUILDING PRODUCTS,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
EBITDA AND ADJUSTED EBITDA
CALCULATIONS
(unaudited, in millions)
The tables below reconcile EBITDA,
Adjusted EBITDA, Adjusted EBITDA, net of dispositions and Adjusted
EBITDA, dispositions to the most directly comparable GAAP financial
measure, net income, for the periods presented therein. We have
included Adjusted EBITDA, net of dispositions, in this press
release because it is a key measure used by our management team to
understand the operating performance and profitability of our
business. During the three months ended June 30, 2024, we decided
to wind down the operations of a single new commercial end
market-oriented branch that focused on the installation of a
non-core end product, due to shifting market conditions, an
unfavorable contract settlement, and sub-standard operating
performance. Accordingly, we believe that excluding the financial
results of this branch from our typical Adjusted EBITDA measure of
profitability provides useful insight and metrics relevant to
understanding and evaluating the results of our ongoing operations.
The Adjusted EBITDA, dispositions line item included below
represents the Adjusted EBITDA of this single branch.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net income, as reported
$
65.2
$
61.6
$
121.1
$
110.9
Interest expense
8.2
9.8
20.1
19.5
Provision for income tax
21.5
21.1
42.0
39.2
Depreciation and amortization
24.7
24.1
49.2
48.1
EBITDA
119.6
116.6
232.4
217.7
Acquisition related expenses
0.6
0.5
1.1
1.1
Share based compensation expense
4.7
3.7
8.7
7.1
Legal reserve
—
1.3
—
1.3
Asset impairment (1)
4.9
—
4.9
—
Adjusted EBITDA
$
129.8
$
122.1
$
247.1
$
227.2
Adjusted EBITDA, dispositions (2)
(6.8
)
(0.6
)
(8.7
)
(0.4
)
Adjusted EBITDA, net of dispositions
(3)
$
136.6
$
122.7
$
255.8
$
227.6
Net profit margin
8.8
%
8.9
%
8.5
%
8.2
%
EBITDA margin
16.2
%
16.9
%
16.2
%
16.1
%
Adjusted EBITDA margin
17.6
%
17.7
%
17.3
%
16.8
%
Adjusted EBITDA margin, net of
dispositions (3)
18.5
%
17.9
%
17.9
%
17.0
%
(1)
During the three and six months ended June
30, 2024, we recognized intangible and asset impairment charges for
a combined amount of $4.9 million related to winding down the
operations of a branch that installs one of our non-core building
products.
(2)
Represents Adjusted EBITDA of a single
branch. Please see preceding paragraph at the beginning of this
section for additional information.
(3)
Adjusted EBITDA, net of dispositions and
Adjusted EBITDA margin, net of dispositions exclude the results of
a single branch. Please see preceding paragraph at the beginning of
this section for additional information.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net revenue, as reported
$
737.6
$
692.1
$
1,430.5
$
1,351.4
Less: net revenue, dispositions (1)
(2.7
)
4.8
(0.5
)
11.5
Net revenue, net of dispositions
$
740.3
$
687.3
$
1,431.0
$
1,339.9
(1)
Represents net revenue of a single branch.
Please see preceding paragraph at the beginning of this section for
additional information.
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Net loss, dispositions, as reported
$
(8.9
)
$
(0.7
)
$
(10.4
)
$
(0.7
)
Interest expense
0.1
0.1
0.1
0.3
(Benefit) for income tax
(3.1
)
(0.2
)
(3.6
)
(0.3
)
Depreciation and amortization
0.2
0.2
0.3
0.3
EBITDA, dispositions
(11.7
)
(0.6
)
(13.6
)
(0.4
)
Asset impairment (1)
4.9
—
4.9
—
Adjusted EBITDA, dispositions (2)
$
(6.8
)
$
(0.6
)
$
(8.7
)
$
(0.4
)
(1)
During the three and six months ended June
30, 2024, we recognized intangible and asset impairment charges for
a combined amount of $4.9 million related to winding down the
operations of a branch that installs one of our non-core building
products.
(2)
Represents Adjusted EBITDA of a single
branch. Please see preceding paragraph at the beginning of this
section for additional information.
INSTALLED BUILDING PRODUCTS,
INC.
SUPPLEMENTARY TABLE
(unaudited)
Three months ended June 30,
Six months ended June 30,
2024
2023
2024
2023
Period-over-period Growth
Consolidated Sales Growth
6.6%
2.3%
5.9%
6.9%
Consolidated Same Branch Sales Growth
4.8%
(1.5)%
3.9%
2.5%
Installation
Sales Growth
7.0%
2.2%
6.2%
6.3%
Same Branch Sales Growth
5.2%
(1.9)%
4.2%
2.2%
Single-Family Sales Growth
10.4%
(9.7)%
7.1%
(4.4)%
Single-Family Same Branch Sales Growth
7.9%
(13.3)%
4.7%
(8.3)%
Multi-Family Sales Growth
6.2%
40.7%
9.6%
39.5%
Multi-Family Same Branch Sales Growth
5.2%
38.3%
8.8%
38.1%
Residential Sales Growth
9.4%
(1.9)%
7.7%
2.4%
Residential Same Branch Sales Growth
7.3%
(5.4)%
5.6%
(1.1)%
Commercial Sales Growth(1)
(4.1)%
24.0%
(0.7)%
25.5%
Commercial Same Branch Sales Growth
(5.3)%
16.1%
(3.1)%
19.1%
Other
(2)
Sales Growth
4.3%
4.9%
4.2%
21.0%
Same Branch Sales Growth
2.4%
4.9%
3.2%
8.1%
Same Branch Sales
Growth - Installation
Volume Growth(3)
(1.4)%
(10.1)%
(1.4)%
(9.8)%
Price/Mix Growth(3)
6.4%
7.2%
5.1%
11.5%
U.S. Housing
Market(4)
Total Completions Growth
11.8%
4.6%
8.7%
7.8%
Single-Family Completions Growth
6.8%
(3.5)%
0.8%
(1.2)%
Multi-Family Completions Growth
22.2%
25.9%
25.3%
35.6%
(1)
Our commercial end market consists of
heavy and light commercial projects.
(2)
Other business segment category includes
our manufacturing and distribution businesses operating
segments.
(3)
The heavy commercial end market is
excluded from these metrics given its much larger per-job revenue
compared to our average job.
(4)
U.S. Census Bureau data, as revised.
INSTALLED BUILDING PRODUCTS,
INC.
INCREMENTAL REVENUE AND ADJUSTED
EBITDA MARGINS
(unaudited, in millions)
Revenue Increase
Three months ended June 30,
Six months ended June 30,
2024
% Total
2023
% Total
2024
% Total
2023
% Total
Same Branch
$
32.5
71.4
%
$
(10.4
)
(67.5
)%
$
51.9
65.6
%
$
31.0
35.6
%
Acquired
13.0
28.6
%
25.8
167.5
%
27.2
34.4
%
56.2
64.4
%
Total
$
45.5
100.0
%
$
15.4
100.0
%
$
79.1
100.0
%
$
87.2
100.0
%
Adjusted EBITDA Margin
Contributions
Three months ended June 30,
Six months ended June 30,
2024
% Margin
2023
% Margin
2024
% Margin
2023
% Margin
Same Branch(1)
$
5.4
16.6
%
$
(2.7
)
26.0
%
$
15.1
29.1
%
$
13.6
43.9
%
Acquired
2.3
17.7
%
5.4
20.9
%
4.8
17.6
%
9.9
17.6
%
Total
$
7.7
16.9
%
$
2.7
17.5
%
$
19.9
25.2
%
$
23.5
26.9
%
(1)
Same branch adjusted EBITDA margin
contribution percentage is a percentage of same branch revenue
increase.
Revenue Increase, Net of Dispositions
(1)
Three months ended June 30,
Six months ended June 30,
2024
% Total
2023
% Total
2024
% Total
2023
% Total
Same Branch
$
40.0
75.5
%
$
(11.4
)
(79.2
)%
$
64.9
70.5
%
$
29.6
34.5
%
Acquired
13.0
24.5
%
25.8
179.2
%
27.2
29.5
%
56.2
65.5
%
Total
$
53.0
100.0
%
$
14.4
100.0
%
$
92.1
100.0
%
$
85.8
100.0
%
(1)
Please see the section - Reconciliation of
GAAP to Non-GAAP measures EBITDA and Adjusted EBITDA calculations -
in this press release for additional information.
Adjusted EBITDA, Net of Dispositions
Margin Contributions (1)
Three months ended June 30,
Six months ended June 30,
2024
% Margin
2023
% Margin
2024
% Margin
2023
% Margin
Same Branch(2)
$
11.6
29.0
%
$
(2.9
)
25.4
%
$
23.4
36.1
%
$
12.8
43.2
%
Acquired
2.3
17.7
%
5.4
20.9
%
4.8
17.6
%
9.9
17.6
%
Total
$
13.9
26.2
%
$
2.5
17.4
%
$
28.2
30.6
%
$
22.7
26.5
(1)
Please see the section - Reconciliation of
GAAP to Non-GAAP measures EBITDA and Adjusted EBITDA calculations -
in this press release for additional information.
(2)
Same branch adjusted EBITDA margin
contribution percentage is a percentage of same branch revenue
increase.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240731592511/en/
Investor Relations: 614-221-9944
investorrelations@installed.net
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