Beacon Roofing Supply, Inc. (NASDAQ:BECN) Q2 2022 Earnings Conference Call August 4, 2022 5:00 PM ET Company Participants Binit Sanghvi - Head, IR Julian Francis - President and CEO Frank Lonegro - EVP and CFO Conference Call Participants Keith Hughes - Truist Securities Ryan Merkel - William Blair Truman Patterson - Wolfe Research Michael Dahl - RBC Capital Markets Philip Ng - Jefferies Deepa Raghavan - Wells Fargo Securities Douglas Wardlaw - JPMorgan David Manthey - Robert W. Baird Ketan Mamtora - BM ...

| --- | --- | --- | --- | --- | |--------------------------------|-------|-------|-------|-------| | | | | | | | 2022 | | | | | | Q2 2022 EARNINGS PRESENTATION | | | | | | AUGUST 4, 2022 | | | | | Disclosure Notice This presentation contains information about management's view of the Company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. In addition, oral statements m ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from _________ to __________ Commission File Number 000-50924 BEACON ROOFING SUPPLY, INC. (Exact name of registrant as specified in its charter) Delaware 36-4173371 (State ...

Beacon Roofing Supply, Inc. (NASDAQ:BECN) Q1 2022 Earnings Conference Call May 5, 2022 5:00 PM ET Company Participants Binit Sanghvi - Head, IR Julian Francis - President and CEO Frank Lonegro - EVP and CFO Conference Call Participants Ketan Mamtora - BMO Capital Markets Mike Dahl with - Capital Markets Garik Shmois - Loop Capital Keith Hughes - Truist Noah Merkousko - Stephens Truman Patterson - Wolfe Research David Manthey - Baird Deepa Raghavan - Wells Fargo Ryan Merkel - William Blair Phil Ng - Jefferie ...

PART I. Financial Information (Unaudited) This section presents the company's unaudited financial statements and related disclosures for the reporting period [Item 1. Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements and related notes, covering balance sheets, income, equity, and cash flows [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in millions) | Item | March 31, 2022 | December 31, 2021 | March 31, 2021 | | :-------------------------------- | :------------- | :---------------- | :------------- | | Cash and cash equivalents | $52.4 | $225.8 | $619.3 | | Accounts receivable, net | $1,008.5 | $855.2 | $759.5 | | Inventories, net | $1,462.1 | $1,161.7 | $1,087.1 | | Total current assets | $2,911.4 | $2,609.9 | $2,778.1 | | Total assets | $5,848.9 | $5,549.3 | $5,688.4 | | Accounts payable | $1,052.2 | $794.2 | $689.0 | | Total current liabilities | $1,572.2 | $1,371.7 | $1,360.7 | | Long-term debt, net | $1,611.2 | $1,612.9 | $2,079.3 | | Total liabilities | $3,703.9 | $3,337.7 | $3,735.9 | | Total stockholders' equity | $1,745.8 | $1,812.4 | $1,553.3 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (Three Months Ended March 31, in millions, except per share amounts) | Item | 2022 | 2021 | | :-------------------------------------------------- | :----- | :----- | | Net sales | $1,686.9 | $1,318.0 | | Cost of products sold | $1,247.4 | $985.2 | | Gross profit | $439.5 | $332.8 | | Total operating expense | $348.2 | $310.0 | | Income (loss) from operations | $91.3 | $22.8 | | Interest expense, financing costs, and other | $16.6 | $28.6 | | Loss on debt extinguishment | — | $9.5 | | Income (loss) from continuing operations before income taxes | $74.7 | $(15.3) | | Provision for (benefit from) income taxes | $18.9 | $(4.8) | | Net income (loss) from continuing operations | $55.8 | $(10.5) | | Net income (loss) from discontinued operations | — | $4.2 | | Net income (loss) | $55.8 | $(6.3) | | Dividends on Preferred Stock | $6.0 | $6.0 | | Net income (loss) attributable to common stockholders | $49.8 | $(12.3) | | Basic net income (loss) per share | $0.62 | $(0.18) | | Diluted net income (loss) per share | $0.61 | $(0.18) | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Condensed Consolidated Statements of Comprehensive Income (Three Months Ended March 31, in millions) | Item | 2022 | 2021 | | :-------------------------------------------------------------------------------------- | :----- | :----- | | Net income (loss) | $55.8 | $(6.3) | | Other comprehensive income (loss): | | | | Foreign currency translation adjustment | $1.5 | $1.0 | | Unrealized gain (loss) due to change in fair value of derivatives, net of tax | $7.8 | $3.4 | | Total other comprehensive income (loss) | $9.3 | $4.4 | | Comprehensive income (loss) | $65.1 | $(1.9) | [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Condensed Consolidated Statements of Stockholders' Equity (Three Months Ended March 31, in millions) | Item | 2022 | 2021 | | :----------------------------------------- | :----- | :----- | | Balance as of December 31 | $1,812.4 | $1,544.8 | | Repurchase and retirement of common stock, net | $(113.0) | — | | Equity forward contract | $(25.0) | — | | Issuance of common stock, net of shares withheld for taxes | $7.2 | $9.1 | | Stock-based compensation | $5.1 | $7.3 | | Other comprehensive income (loss) | $9.3 | $4.4 | | Net income (loss) | $55.8 | $(6.3) | | Dividends on Preferred Stock | $(6.0) | $(6.0) | | Balance as of March 31 | $1,745.8 | $1,553.3 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (Three Months Ended March 31, in millions) | Item | 2022 | 2021 | | :--------------------------------------------------- | :------- | :------- | | Net cash provided by (used in) operating activities | $(162.0) | $(84.0) | | Net cash provided by (used in) investing activities | $(22.0) | $823.7 | | Net cash provided by (used in) financing activities | $11.0 | $(582.0) | | Effect of exchange rate changes on cash and cash equivalents | $(0.4) | $0.2 | | Net increase (decrease) in cash and cash equivalents | $(173.4) | $157.9 | | Cash and cash equivalents, beginning of period | $225.8 | $461.4 | | Cash and cash equivalents, end of period | $52.4 | $619.3 | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the company's accounting policies, acquisitions, divestitures, and other financial disclosures [Note 1. Company Overview](index=7&type=section&id=Note%201.%20Company%20Overview) This note describes the company's primary business and significant historical transactions - Beacon Roofing Supply, Inc. is the largest publicly traded distributor of residential and non-residential roofing materials and complementary building products in the United States and Canada[13](index=13&type=chunk) - On February 10, 2021, the Company completed the sale of its interior products and insulation businesses ("Interior Products") for approximately **$850 million in cash**, reflected as discontinued operations for the three months ended March 31, 2021[14](index=14&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=8&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the accounting principles and methods used in preparing the financial statements - The condensed consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information, with certain footnotes condensed or omitted[16](index=16&type=chunk) - The Company changed its fiscal year end from September 30 to December 31, effective January 1, 2022, to align with industry peers and improve internal processes[18](index=18&type=chunk) - The Company records acquisitions using the acquisition method of accounting, recognizing acquired assets and assumed liabilities at estimated fair values, with the excess recorded as goodwill[22](index=22&type=chunk)[23](index=23&type=chunk) [Note 3. Acquisitions](index=9&type=section&id=Note%203.%20Acquisitions) This note details the company's recent acquisition activities and their financial impact - On November 1, 2021, the Company acquired Midway Sales & Distributing, Inc. for approximately **$130 million in annual sales**, resulting in **$28.7 million of goodwill** and **$38.5 million of intangible assets**[27](index=27&type=chunk)[28](index=28&type=chunk) - On January 1, 2022, the Company purchased Crabtree Siding and Supply, a wholesale distributor with annual sales of approximately **$1 million**, resulting in **$0.2 million of goodwill**[29](index=29&type=chunk)[30](index=30&type=chunk) - During the three months ended March 31, 2022, the Company recognized a gain of **$0.9 million** from the resolution of an indemnity holdback liability related to the 2017 acquisition of Lowry's Inc[31](index=31&type=chunk) [Note 4. Divestitures](index=9&type=section&id=Note%204.%20Divestitures) This note describes the company's recent divestiture activities and their financial impact - On December 1, 2021, the Company divested its solar products business to focus on its core exteriors business, recording a loss on sale of **$22.3 million** in Q4 2021[32](index=32&type=chunk) - On February 10, 2021, the Company completed the sale of Interior Products for **$842.7 million in cash**, using proceeds to reduce net leverage and pursue strategic growth in core exteriors[33](index=33

| --- | --- | --- | --- | --- | |--------------------------------|-------|-------|-------|-------| | | | | | | | 2022 | | | | | | Q1 2022 EARNINGS PRESENTATION | | | | | | MAY 5, 2022 | | | | | Disclosure Notice This presentation contains information about management's view of the Company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. In addition, oral statements made ...

Financial Data and Key Metrics Changes - The company reported nearly $1.8 billion in total net sales for the calendar fourth quarter, an increase of over 11% year-over-year, primarily driven by higher average selling prices [20][28] - Adjusted EBITDA increased by 21% in the calendar fourth quarter, yielding nearly 10% margin [7][28] - Gross margins improved to 26.3%, an increase of nearly 95 basis points year-over-year, with price cost contributing positively by approximately 110 basis points [23][28] Business Line Data and Key Metrics Changes - Residential roofing sales increased approximately 9%, while volumes were down about 10% year-over-year due to lower storm activity compared to the previous year [21][22] - Non-residential roofing sales rose approximately 13%, despite supply chain challenges [22] - Complementary sales increased approximately 16%, benefiting from higher prices across nearly all products [22] Market Data and Key Metrics Changes - The residential market remains strong, with approximately 80% of demand coming from re-roofing activity, which is largely non-discretionary [21] - The backlog is at its highest in history, with about two-thirds non-residential and one-third residential, indicating strong future demand [74] Company Strategy and Development Direction - The company is focusing on enhancing customer experience and sales effectiveness through investments in training and marketing [12] - The strategic initiative "Ambition 2025" aims to accelerate growth and profitability, with a focus on operational efficiency and talent development [18][30] - Recent acquisitions, including Midway Wholesale and Crabtree Siding and Supply, are expected to enhance market presence and operational capabilities [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2022, expecting total sales growth in the high single-digits range year-over-year, despite anticipated supply chain disruptions [28][29] - The company remains confident in its ability to implement price increases to offset inflation, with expectations for gross margin improvement [29][51] - Management highlighted the importance of distribution in managing inventory and capturing market share [34] Other Important Information - The company divested its solar products business to focus on core roofing customers, which was seen as a strategic move to enhance margins [9][26] - Operating cash flow was positive at $60 million for the quarter, reflecting improved financial flexibility [25] Q&A Session Summary Question: Inventory management and pricing dynamics - Management indicated that the inventory build is roughly half price and half volume, with specific categories varying [35] Question: Full-year guidance on sales and margins - Management clarified that for Q1 2022, volume is expected to be down in the low-single-digit range, while price is anticipated to be up in the low double-digit range [39] Question: Non-residential business consistency - Management noted that the commercial business is being run differently, with a positive long-term outlook despite short-term supply chain challenges [60] Question: EBITDA guidance and margin contraction - Management acknowledged that inventory profits will impact gross margins, with expectations for a 50 to 100 basis point headwind in 2022 [64] Question: Volume expectations by segment - Management expects low-single-digit volume growth in residential for the full year, with a more robust outlook for non-residential [70][72]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the Fiscal Year Ended September 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ________ to ________ Commission File Number 000-50924 BEACON ROOFING SUPPLY, INC. (Exact name of registrant as specified in its charter) Delaware 36-4173371 State or other ...

| --- | --- | --- | --- | --- | --- | |------------------------------------------|-------|-------|-------|-------|-------| | | | | | | | | 2021 | | | | | | | 4TH QUARTER & FISCAL 2021 EARNINGS CALL | | | | | | | NOVEMBER 18, 2021 | | | | | | DISCLOSURE NOTICE This presentation contains information about management's view of the Company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Refor ...

Beacon Roofing Supply, Inc. (NASDAQ:BECN) Q3 2021 Earnings Conference Call August 5, 2021 5:00 PM ET Company Participants Binit Sanghvi - Head, IR Julian Francis - President, CEO & Director Frank Lonegro - EVP & CFO Conference Call Participants Kathryn Thompson - Thompson Research Group Michael Dahl - RBC Capital Markets Ketan Mamtora - BMO Capital Markets Philip Ng - Jefferies Noah Merkousko - Stephens Inc. Truman Patterson - Wolfe Research Garik Shmois - Loop Capital Markets Keith Hughes - Truist Securiti ...