Core & Main(US:CNM)2025-06-10 11:33Financial Performance - Net sales for the three months ended May 4, 2025, increased to $1,911 million, up 9.8% from $1,741 million for the same period in 2024[18] - Gross profit for the same period was $510 million, representing a gross margin of 26.7%, compared to $468 million and a gross margin of 26.9% in the prior year[18] - Net income attributable to Core & Main, Inc. for the three months ended May 4, 2025, was $100 million, an increase of 5.3% from $95 million in the prior year[18] - Basic earnings per share (EPS) increased to $0.53, up from $0.49 in the same period last year, while diluted EPS also rose to $0.52 from $0.49[18] - Operating income for the three months ended May 4, 2025, was $171 million, slightly up from $168 million in the same period last year[18] - Adjusted EBITDA for the three months ended May 4, 2025, increased by $7 million, or 3.2%, to $224 million compared to $217 million for the same period in 2024[118] Assets and Liabilities - Total assets as of May 4, 2025, were $6,278 million, an increase from $5,870 million as of February 2, 2025[16] - Total liabilities increased to $4,457 million as of May 4, 2025, compared to $4,096 million as of February 2, 2025[16] - Retained earnings rose to $515 million as of May 4, 2025, up from $449 million as of February 2, 2025[16] - Total debt as of May 4, 2025, was $2,284 million, with current maturities of long-term debt totaling $24 million[55] - The company reported an increase in accounts payable by $361 million, compared to an increase of $244 million in the prior year[25] Cash Flow and Investments - Cash flows from operating activities provided $77 million, slightly down from $78 million in the same period last year[25] - Net cash provided by operating activities was $77 million for the three months ended May 4, 2025, a decrease of $1 million compared to $78 million for the same period in 2024[129] - Net cash used in investing activities decreased significantly by $558 million to $16 million for the three months ended May 4, 2025, primarily due to $564 million in cash outflows for acquisitions in fiscal 2024[130] - Net cash used in financing activities was $61 million for the three months ended May 4, 2025, compared to net cash provided of $525 million for the same period in 2024, reflecting a $586 million change[131] Shareholder Activities - The company repurchased 837,268 shares of Class A common stock for a total of $39 million during the three months ended May 4, 2025, with $285 million remaining under the authorized repurchase program[29] - The company completed $39 million of Class A common stock repurchases during the three months ended May 4, 2025[126] - The maximum number of shares that may yet be purchased under the repurchase program is $285 million[159] Tax and Compliance - The effective tax rate for the three months ended May 4, 2025, was 25.5%, an increase from 24.6% in the prior year[67] - The provision for income taxes increased by $3 million, or 9.1%, to $36 million, with an effective tax rate of 25.5% for the three months ended May 4, 2025[113] - The Company was in compliance with all debt covenants as of May 4, 2025[59] Acquisitions and Intangible Assets - The company did not complete any acquisitions during the three months ended May 4, 2025, following significant acquisitions totaling $585 million in the previous fiscal year[39] - The company closed acquisitions during the fiscal year ended February 2, 2025, with an aggregate transaction value of $769 million[94] - The company’s intangible assets acquired during the Fiscal 2024 Acquisitions included $219 million related to customer relationships and $282 million in goodwill[44] - Total intangible assets as of May 4, 2025, amounted to $1,811 million, with net intangible assets of $901 million[53] Market and Economic Conditions - The Infrastructure Investment and Jobs Act includes $55 billion for water infrastructure investment, which may positively impact the Company's business[87] - The company experienced price stability in fiscal 2023 compared to price inflation in fiscal 2022, with improvements in supply chain conditions[90] - The company is exposed to price fluctuations in the cost of procuring products, which may affect gross profit margins[148] - As of May 4, 2025, foreign currency operations were not material, with a hypothetical 10% change in the U.S. dollar's value not materially impacting net earnings[149] Risk and Legal Matters - The company is not currently party to any material legal proceedings, although it faces inherent risks related to product liability claims[154] - The company maintains provisions for potential credit losses, which have historically been within expectations[147]