Builders FirstSource(BLDR) - 2025 Q3 - Quarterly Results

Financial Performance - Net sales for Q3 2025 were $3.9 billion, a 6.9% decrease year-over-year, primarily due to a 10.6% decline in core organic net sales and commodity deflation of 1.1%[3] - Gross profit was $1.2 billion, down 13.5%, with a gross profit margin of 30.4%, a decrease of 240 basis points from the prior year[4] - Net income was $122.4 million, or diluted EPS of $1.10, representing a 57.0% decrease compared to $284.8 million, or $2.44 EPS, in the same period last year[9] - Adjusted EBITDA decreased 30.8% to $433.7 million, with an adjusted EBITDA margin of 11.0%, down 380 basis points year-over-year[3] - Free cash flow for the quarter was $464.9 million, a decrease of 26.8% from $634.7 million in the prior year period[3] - For the three months ended September 30, 2025, net sales were $3,941,190, a decrease of 6.9% compared to $4,232,494 in the same period of 2024[29] - Gross margin for the three months ended September 30, 2025, was $1,199,483, down from $1,386,333 in 2024, reflecting a decline of 13.5%[29] - Net income for the three months ended September 30, 2025, was $122,384, a decrease of 57.0% compared to $284,783 in 2024[29] - Adjusted EBITDA for the three months ended September 30, 2025, was $433.7 million, with an adjusted EBITDA margin of 11.0%[38] - Total net sales for the three months ended September 30, 2025, were $3,941.2 million, down 6.9% from $4,232.5 million in 2024[46] - Adjusted net income for the nine months ended September 30, 2025, was $645.8 million, compared to $1,107.4 million in 2024, reflecting a decline of approximately 41.7%[36] - Free cash flow for the nine months ended September 30, 2025, was $765.0 million, after capital expenditures of $256.1 million[45] Future Projections - The company expects full-year 2025 net sales to be in the range of $15.1 billion to $15.4 billion[12] - Projected adjusted EBITDA for 2025 is expected to be between $1.625 billion and $1.675 billion[12] - The company anticipates delivering $45 million to $60 million in productivity savings in 2025[13] Shareholder Actions - The company has repurchased 3.4 million shares year-to-date at an average price of $118.65 per share, totaling $403.6 million[13] Liquidity and Debt - Liquidity as of September 30, 2025, was approximately $2.1 billion, consisting of $1.8 billion in net borrowing availability and $0.3 billion in cash[13] - The company’s long-term debt, net of current maturities, increased to $4,428,746 as of September 30, 2025, compared to $3,700,643 as of December 31, 2024[33] - Interest expense for the three months ended September 30, 2025, totaled $69.9 million, with net debt outstanding at $4,191.7 million[43] Operational Metrics - The company reported net cash provided by operating activities of $547,724 for the three months ended September 30, 2025, compared to $729,958 in 2024, a decrease of 25.0%[31] - Total assets increased to $11,430,883 as of September 30, 2025, compared to $10,583,086 as of December 31, 2024, reflecting a growth of 8.0%[33] - Cash and cash equivalents at the end of the period were $296,162, a decrease from $328,103 at the end of the same period in 2024[31] - Selling, general and administrative expenses for the three months ended September 30, 2025, were $970,715, slightly up from $958,310 in 2024[29] - GAAP SG&A expense for the three months ended September 30, 2025, was $970.7 million, representing 24.6% of sales[41] Market Trends - The percentage of sales attributed to value-added products decreased to 47.1% in Q3 2025 from 49.7% in Q3 2024[46] - The company reported a decline in sales across multiple product categories, with manufactured products down 14.4% year-over-year[46] Tax and Accounting - The company’s effective tax rate on operations is forecasted to be impacted by various non-recurring items, making future estimates challenging[25] - Adjusted EBITDA outlook and free cash flow forecasts exclude certain income and expense items, which may include restructuring charges and non-recurring costs[25] - GAAP net income for the three months ended September 30, 2025, was $122.4 million, a decrease from $284.8 million in the same period of 2024[36] - Basic adjusted net income per share for the three months ended September 30, 2025, was $1.89, down from $3.09 in the same period of 2024[36]