GMS(US:GMS)2024-12-05 11:06Financial Performance - Net sales for the second quarter of fiscal 2025 were $1.5 billion, an increase of 3.5% year-over-year, while organic net sales decreased by 4.6%[3] - Net income decreased by 33.9% to $53.5 million, or $1.35 per diluted share, with a net income margin decline of 200 basis points to 3.6%[18] - Adjusted EBITDA was $152.2 million, a decrease of $15.3 million or 9.2%, with an adjusted EBITDA margin of 10.3% compared to 11.8% in the prior year[19] - Operating income decreased to $94,824 thousand from $124,798 thousand, reflecting a decline of 24% year-over-year[36] - Net income for the quarter was $53,536 thousand, down 33.8% from $80,957 thousand in the prior year[36] - Basic net income per share was $1.37, compared to $2.00 in the same quarter last year, representing a decrease of 31.5%[36] - Net income for the three months ended October 2024 was $53,536 thousand, a decrease of 33.8% compared to $80,957 thousand for the same period in 2023[52] - Adjusted EBITDA for the six months ended October 2024 was $298,105 thousand, down 12.5% from $340,856 thousand for the same period in 2023[52] - Adjusted net income for the three months ended October 2024 was $80,061 thousand, a decrease of 18.6% compared to $98,448 thousand for the same period in 2023[59] - Net income for the last twelve months ended October 31, 2023, was $219,076, down from $308,155 in the previous period, representing a decrease of approximately 29%[62] Cash Flow and Liquidity - Cash provided by operating activities was $115.6 million, down from $118.1 million in the prior year, while free cash flow was $101.5 million compared to $102.1 million[21] - Cash provided by operating activities was $92.662 million, down 25.7% from $124.747 million year-over-year[41] - Cash used in investing activities totaled $233.189 million, significantly higher than $83.809 million in the previous year, primarily due to business acquisitions[41] - Cash provided by financing activities was $57.712 million, a turnaround from cash used of $128.778 million in the same quarter last year[41] - Cash and cash equivalents decreased to $83,928 thousand from $166,148 thousand, indicating a significant reduction in liquidity[38] - Cash and cash equivalents rose to $83,928, up from $76,517, showing an increase of about 9%[62] Sales and Revenue Breakdown - Wallboard sales were $582.1 million, a decrease of 0.5%, while Steel Framing sales decreased by 6.3% to $217.4 million[11][13] - Total net sales for the quarter reached $1.471 billion, representing a 3.5% increase from $1.421 billion in the same quarter of the previous year[44] - Wallboard sales accounted for 39.6% of total net sales, generating $582.119 million, a slight decrease of 0.5% compared to $585.174 million in the prior year[46] - Steel framing sales were $217.388 million, down 6.3% from $232.108 million year-over-year, representing 14.8% of total net sales[46] - Net sales for the six months ended October 2024 were $2,919,232 thousand, an increase of 3.1% compared to $2,830,530 thousand for the same period in 2023[56] Expenses and Costs - SG&A expenses increased to $324.2 million, up from $300.9 million, with a significant portion attributed to recent acquisitions and severance costs[16] - Selling, general and administrative expense for the three months ended October 2024 was $324,225 thousand, an increase of 7.7% compared to $300,894 thousand for the same period in 2023[56] - Adjusted SG&A margin for the three months ended October 2024 was 21.1%, up from 20.6% for the same period in 2023[56] - Interest expense for the three months ended October 2024 was $23,697 thousand, an increase of 26.3% compared to $18,742 thousand for the same period in 2023[52] - Interest expense increased to $83,715 from $72,783, which is an increase of about 15%[62] - Depreciation expense rose to $75,673, compared to $64,416, reflecting an increase of approximately 17%[62] Debt and Leverage - Net debt leverage increased to 2.3 times, up from 1.5 times a year ago, with total debt reported at $1.5 billion[20] - Long-term debt increased to $1,426,564 thousand from $1,229,726 thousand, reflecting a rise of 16%[38] - Total debt increased significantly to $1,481,446 from $1,076,050, reflecting a rise of about 37.5%[62] - Net debt increased to $1,397,518 from $999,533, reflecting a rise of about 40%[62] Strategic Initiatives - The company renewed its share repurchase program, authorizing up to $250 million for repurchase of outstanding common stock[6] - The company successfully acquired R. S. Elliott Specialty Supply, enhancing its distribution capabilities in Florida[24] - The company opened new greenfield locations in Summerville, SC, Middleton, MA, and Clackamas, OR, expanding its service and product offerings[25] - The company plans to continue focusing on market expansion and new product development to drive future growth[41] Other Financial Metrics - Total assets increased to $4,023,009 thousand as of October 31, 2024, up from $3,759,840 thousand as of April 30, 2024[38] - Current liabilities decreased slightly to $748,697 thousand from $757,050 thousand, indicating improved short-term financial stability[38] - The company reported a total stockholders' equity of $1,469,307 thousand, a slight increase from $1,460,521 thousand[38] - EBITDA adjustments totaled $38,288, up from $27,906, indicating an increase of about 37%[62] - Pro Forma Adjusted EBITDA was $603,735, down from $647,410, representing a decrease of approximately 6.7%[62]