Griffon Earnings Surpass Estimates in Q1, Revenues Decrease 2% Y/Y

Core Insights - Griffon Corporation (GFF) reported adjusted earnings of $1.39 per share for Q1 fiscal 2025, exceeding the Zacks Consensus Estimate of$ 1.28, marking a year-over-year increase of 29.9% [1] - Total revenues were $632.4 million, falling short of the consensus estimate of$ 640 million and reflecting a 2% decrease year over year [1] Segmental Performance - Home and Building Products: This segment accounted for 62.5% of net revenues, generating $395.4 million, stable year over year. Adjusted EBITDA rose 2% to$ 127 million, aided by lower material costs despite increased labor and distribution costs [2] - Consumer and Professional Products: Representing 37.5% of revenues, this segment's sales totaled $237 million, down 4.2% year over year due to an 8% volume reduction in North America and the UK, partially offset by growth in Australia. The Pope acquisition contributed 4% to revenues [3][4] Margin Profile - Cost of sales decreased by 9.5% year over year to$ 368.1 million, while selling, general, and administrative expenses remained stable at $152.2 million. Gross margin improved to 41.8% from 36.8% in the previous year [5] - Net income surged 68% year over year to$ 70.9 million [5] Balance Sheet & Cash Flow - At the end of Q1 fiscal 2025, cash and cash equivalents stood at $152 million, up from$ 114.4 million at the end of fiscal 2024. Long-term debt decreased to $1.47 billion from$ 1.52 billion [6] - The company generated net cash of $142.9 million from operating activities, slightly down from$ 146.1 million in the prior year. It paid $9 million in dividends and repurchased shares worth$ 42.3 million, with $390.3 million remaining under the share repurchase program [7] - Free cash flow was reported at$ 142.7 million, an increase from $132.5 million in the previous year [8]