Builders FirstSource(BLDR) - 2024 Q4 - Annual Results

Financial Performance - For Q4 2024, net sales were $3.8 billion, an 8.0% decrease driven by lower core organic sales of 8.8% and commodity deflation of 3.1%[3] - Gross profit for Q4 2024 was $1.2 billion, a decrease of 15.7%, with a gross margin of 32.3%, down 300 basis points[4] - Net income for Q4 2024 was $190.2 million, or diluted EPS of $1.65, a 45.8% decrease compared to the prior year[9] - Adjusted EBITDA for Q4 2024 decreased 28.0% to $493.6 million, with an adjusted EBITDA margin of 12.9%, down 360 basis points[10] - Net sales for Q4 2024 were $3,820.3 million, a decrease of 7.9% from $4,150.9 million in Q4 2023[31] - Gross margin for Q4 2024 was $1,234.1 million, down 15.7% from $1,464.9 million in Q4 2023[31] - Net income for Q4 2024 was $190.2 million, a decline of 45.9% compared to $350.8 million in Q4 2023[31] - Adjusted EBITDA for Q4 2024 was $493.6 million, down 28.0% from $685.5 million in Q4 2023, with an adjusted EBITDA margin of 12.9%[39] - Free cash flow for the twelve months ended December 31, 2024, was $1,506.1 million, reflecting strong operating activities of $1,872.7 million[45] Cash Flow and Capital Management - For full-year 2024, cash provided by operating activities was $1.9 billion, down from $2.3 billion in the prior year, with free cash flow of $1.5 billion, a decrease of $0.4 billion[10] - The company repurchased 8.9 million shares in 2024 at an average price of $170.74, reducing total shares outstanding by 6.8%[10] - Interest expense increased to $53.1 million in Q4 2024 from $46.8 million in Q4 2023[31] - The company experienced a net cash provided by operating activities of $373.5 million in Q4 2024, down from $611.7 million in Q4 2023[33] - Cash and cash equivalents at the end of Q4 2024 were $153.6 million, compared to $66.2 million at the end of Q4 2023[33] Future Projections - For 2025, the company expects net sales in the range of $16.5 billion to $17.5 billion and adjusted EBITDA between $1.9 billion and $2.3 billion[20] - The company anticipates a gross profit margin in the range of 30% to 32% for 2025[20] - Projected capital expenditures for 2025 are between $350 million and $450 million[20] - The effective tax rate for 2025 is expected to be between 23.0% and 25.0%[20] Asset and Liability Management - Total assets increased to $10,583.1 million in 2024 from $10,499.5 million in 2023, representing a growth of 0.8%[35] - Total liabilities increased to $6,286.6 million in 2024 from $5,767.1 million in 2023, marking a rise of 9.0%[35] - Total stockholders' equity decreased to $4,296.5 million in 2024 from $4,732.4 million in 2023, a decline of 9.2%[35] Sales Performance by Segment - For the twelve months ended December 31, 2024, total net sales decreased by 4.1% to $16,400.5 million from $17,097.3 million in 2023[47] - Windows, doors & millwork sales for the full year 2024 were $4,226.9 million, a slight decrease of 1.9% from $4,310.1 million in 2023[47] - Specialty building products & services saw a 1.5% increase in sales for the full year 2024, reaching $4,050.1 million compared to $3,992.1 million in 2023[47] - Lumber & lumber sheet goods sales for the full year 2024 were $4,191.9 million, up 1.6% from $4,126.0 million in 2023[47] - The company reported a 15.8% decline in manufactured products sales for the full year 2024, totaling $3,931.6 million compared to $4,669.1 million in 2023[47] - The percentage of value-added products in total net sales remained stable at 49.7% for the full year 2024[47] - Value-added products accounted for 49.7% of total net sales in Q4 2024, down from 51.9% in Q4 2023[47] - Manufactured products sales in Q4 2024 were $899.6 million, down 18.9% from $1,108.6 million in Q4 2023[47] Management Insights - Builders FirstSource's management emphasizes the importance of non-GAAP financial measures for evaluating business performance and trends[27] - The company is focusing on market expansion and new product development to counteract declining sales in certain segments[47] - GAAP SG&A expense for Q4 2024 was $930.0 million, down from $974.4 million in Q4 2023, with an adjusted SG&A expense of $764.2 million[42] - The company reported a basic adjusted net income per share of $2.33 for Q4 2024, compared to $3.58 in Q4 2023[37] - The company incurred $20.3 million in technology implementation expenses during Q4 2024, compared to $29.8 million in Q4 2023[39]