Financial Performance - Worthington Enterprises reported adjusted EBITDA of $67 million and adjusted earnings per share of $0.80 for Q3 2024[8]. - Consolidated net sales decreased by 8.5% to $317 million from $346 million in the prior year, driven by lower sales in Building Products[22]. - Gross profit for the quarter decreased to $73 million, while gross margin increased to 23.1% from 22.8%[23]. - Adjusted EBITDA margin for the trailing 12 months is 21.5%, with trailing 12 months adjusted EBITDA at $279 million[24]. - The Consumer Products segment saw net sales of $133 million, up from $131 million a year ago, with adjusted EBITDA of $26 million[28]. - Building Products generated net sales of $148 million, down 19% from $184 million a year ago, with adjusted EBITDA of $53 million[31]. - Sustainable Energy Solutions reported net sales of $35 million, an 11% increase, but incurred an adjusted EBITDA loss of $3 million[37]. Debt and Liquidity - Worthington Enterprises ended the quarter with $298 million in long-term funded debt and $227 million in cash, yielding around 5%[26]. - The company declared a dividend of $0.16 per share for the quarter, totaling approximately $8 million[27]. - The company maintains a robust balance sheet and liquidity, positioning itself for future M&A opportunities when suitable targets are identified[60]. Acquisitions and Growth Strategy - Worthington Enterprises acquired an 80% interest in HALO Products Group for approximately $9 million, enhancing its outdoor living product offerings[30]. - The HALO acquisition is expected to enhance product development and market presence, with a focus on margin-rich and asset-light opportunities in M&A[57][61]. - The company aims to drive its EBITDA margin up to 24% over the next three to five years through improved profitability and capital efficiency[71]. Market Trends and Consumer Sentiment - The company anticipates a potential increase in demand for its products as the spring and summer seasons approach, despite current cautious consumer sentiment[53]. - The overall market for commercial construction products remains steady, with expectations of a potential renovation renaissance driven by macro trends[65]. Segment Performance and Challenges - The gross margin for the quarter was 23.1%, with the Consumer products business achieving an EBITDA margin of 19.3%[66]. - The Building Products segment reported a gross margin of 6.2%, which is expected to normalize above this level as destocking issues resolve[68]. - The company is experiencing a destocking effect in large propane tanks, impacting sales, but overall volumes are only down 2%[76]. - The water business is showing solid progress, contributing positively to the overall performance despite challenges in other segments[69]. - Recent weather events have created temporary spikes in demand for camping gas cylinders, which may have shifted some demand from Q4 to Q3[47][50].
Worthington Industries(WOR_V) - 2024 Q1 - Quarterly Results