American Woodmark (US:AMWD)2024-08-27 20:09Financial Performance - Net sales for the first quarter of fiscal 2025 were $459.1 million, a decrease of $39.1 million or 7.9% compared to the same period in fiscal 2024[82]. - The company reported a net income of $29.6 million, or 6.5% of net sales, down from $37.9 million, or 7.6% of net sales in the prior year[80]. - Gross profit margin decreased to 20.2% in the first quarter of fiscal 2025 from 22.0% in the same period of fiscal 2024, a decline of 180 basis points[85]. - Net income for the first quarter of fiscal 2025 was $29.6 million, down from $37.9 million in the same quarter of the prior year, representing a decline of 21.5%[95]. - Adjusted EBITDA for the first quarter of fiscal 2025 was $62.9 million, or 13.7% of net sales, compared to $75.2 million, or 15.1% of net sales for the same quarter of the prior year, indicating a decrease of 16.5%[97]. Sales Performance - Remodeling sales decreased by 15.6% during the first quarter of fiscal 2025 compared to the same prior year period[82]. - Builder sales increased by 3.3% in the first quarter of fiscal 2025 compared to the same period of fiscal 2024[83]. - The Company expects a low single-digit decline in net sales for fiscal 2025 due to a softer repair and remodel market, partially offset by an increase in new construction[99]. Expenses and Income Tax - General and administrative expenses decreased by $14.1 million or 39.6% year-over-year, representing 4.7% of net sales in the first quarter of fiscal 2025[87]. - The effective income tax rate for the three-month period ended July 31, 2024, was 25.0%, up from 21.9% in the comparable prior year period[88]. Cash and Debt Management - Cash and cash equivalents totaled $89.3 million as of July 31, 2024, an increase of $1.9 million from April 30, 2024, primarily due to $40.8 million cash provided by operations[102]. - Total long-term debt was $374.9 million as of July 31, 2024[102]. - The Company has a $500 million revolving loan facility and a $250 million term loan facility, with approximately $322.9 million available under the Revolving Facility as of July 31, 2024[104]. - Cash flow from operations and accumulated cash are expected to be sufficient to support working capital requirements and service existing debt obligations for the remainder of fiscal 2025[109]. Share Repurchase and Investment - The company repurchased $24.0 million of its common shares during the first quarter of fiscal 2025, with $65.4 million remaining available for future repurchases[108]. - The Board of Directors authorized a stock repurchase program of up to $125 million, canceling the remaining $22.1 million from a previous authorization[108]. - Net cash used for investing activities was $11.4 million in the first three months of fiscal 2025, compared to $14.2 million in the same period of fiscal 2024[107]. Market Conditions - The unemployment rate increased to 4.3% as of July 2024, compared to 3.5% in July 2023[79]. - Consumer sentiment decreased from 71.6 in July 2023 to 66.4 in July 2024[79]. - The median price per existing home sold increased by 4.9% during the second calendar quarter of 2024 compared to the same period one year ago[79]. Operational Insights - The Company has experienced seasonal influences, with higher sales typically in the first and fourth fiscal quarters, although seasonal fluctuations have reduced in recent years[110]. - The Company has been able to recover the effects of inflation and commodity price fluctuations through sales price increases over time[110]. - The Company had no off-balance sheet arrangements as of July 31, 2024[107].