Core & Main(US:CNM)2025-12-09 11:30Financial Performance - Net sales increased 1.2% to $2,062 million compared to $2,038 million in the same quarter last year, driven primarily by acquisitions[7] - Gross profit rose 3.3% to $561 million, with a gross profit margin of 27.2%, up from 26.6% in the prior year[9] - Net income increased 2.1% to $143 million, attributed to a decrease in interest expense[12] - Adjusted EBITDA decreased 1.1% to $274 million, impacted by higher SG&A expenses[14] - Operating income decreased 1.3% to $220 million, primarily due to higher SG&A expenses[11] - Net income attributable to Core & Main, Inc. for the third quarter was $137 million, compared to $133 million in the same quarter last year, resulting in diluted earnings per share of $0.72[40] - Adjusted EBITDA for the nine months ended November 2, 2025, was $764 million, up from $751 million for the same period in 2024, reflecting a 1.7% growth[50] - Adjusted Diluted Earnings Per Share for the three months ended November 2, 2025, was $0.89, compared to $0.86 for the same period in 2024, indicating a 3.5% increase[53] - EBITDA for the three months ended November 2, 2025, was $267 million, slightly down from $269 million for the same period in 2024, a decrease of 0.7%[50] Expenses and Costs - SG&A expenses increased 7.7% to $295 million, representing 14.3% of net sales, up from 13.4% in the previous year[10] - The company reported capital expenditures of $31 million for the nine months ended November 2, 2025, compared to $24 million in the prior year[44] - Equity-based compensation for the nine months ended November 2, 2025, was $14 million, compared to $11 million for the same period in 2024, reflecting a 27.3% increase[50] Debt and Cash Management - Net debt decreased to $2,083 million from $2,420 million as of the same date last year, due to lower borrowings[25] - Long-term debt decreased to $2,129 million from $2,237 million since the beginning of the fiscal year[42] - Total Debt as of November 2, 2025, was $2,172 million, down from $2,430 million as of October 27, 2024[55] - Net Debt decreased to $2,083 million as of November 2, 2025, from $2,420 million as of October 27, 2024, showing a reduction of 14%[55] - Cash and cash equivalents at the end of the period were $89 million, significantly higher than $8 million at the beginning of the period[44] - Net cash provided by operating activities for the nine months ended November 2, 2025, was $382 million, compared to $386 million for the same period last year[44] Strategic Acquisitions - Core & Main completed the acquisition of Canada Waterworks on September 30, 2025[7] - The company continues to focus on strategic acquisitions, with $32 million spent on acquisitions net of cash acquired during the nine months ended November 2, 2025[44] - The company expects variability in acquisition expenses to significantly impact future GAAP financial results, indicating potential unpredictability in earnings[49] Future Outlook - For fiscal 2025, the company expects net sales of $7,600 to $7,700 million, with adjusted EBITDA of $920 to $940 million[30] - Total assets increased to $6,300 million as of November 2, 2025, up from $5,870 million at the end of the previous fiscal year[42] Non-GAAP Measures - The company emphasizes the importance of non-GAAP financial measures like Adjusted EBITDA and Adjusted Diluted Earnings Per Share for evaluating performance, despite their limitations[48] - The amortization of intangible assets for the three months ended November 2, 2025, was $0.19 per share, consistent with the same period in 2024[53]