TopBuild Reports Fourth Quarter and Year-End 2024 Results, Provides 2025 Outlook and Announces New $1 Billion Share Repurchase Authorization

Core Insights - TopBuild Corp. reported a 2.0% increase in fourth quarter sales to $1.31 billion, primarily driven by a 6.6% growth in Specialty Distribution [2][6] - The company achieved record full-year results for 2024, with sales reaching $5.3 billion and adjusted EBITDA of $1.07 billion [3][9] - For 2025, TopBuild anticipates sales between $5.05 billion and $5.35 billion, with adjusted EBITDA projected between $925 million and $1.075 billion [4][18] Fourth Quarter Highlights - Fourth quarter sales were $1,312,206 thousand, up from $1,286,074 thousand in the previous year [8] - Gross margin decreased to 29.9% from 30.4%, while adjusted EBITDA margin improved to 19.7% from 19.6% [8][34] - Installation sales were $789 million, down 0.2%, while Specialty Distribution sales increased by 6.6% to $602 million [10][12] Full Year Highlights - Total sales for 2024 were $5,329,803 thousand, compared to $5,194,694 thousand in 2023, marking a 2.6% increase [9] - The company completed eight acquisitions totaling $153.1 million in annual sales [3][7] - Capital returned to shareholders through share repurchases amounted to $966.4 million, with approximately 2.5 million shares repurchased [3][16] 2025 Outlook - The company expects residential sales to decline in the mid-single digits, while commercial and industrial sales are projected to grow in the low single digits [18] - The guidance does not include potential acquisitions or divestitures expected during the year [18] - Interest expense is anticipated to be between $49 million and $55 million, with capital expenditures estimated at 1.5% to 2.0% of sales [19] Capital Allocation - TopBuild's Board of Directors authorized a new share repurchase program of up to $1.0 billion, in addition to the remaining $188.1 million from the previous authorization [17] - The company maintained a disciplined approach to capital allocation, focusing on acquisitions as a top priority for deploying free cash flow [7][18] Segment Profitability - For the year ended December 31, 2024, the Installation segment reported an operating profit of $649,162 thousand, while the Specialty Distribution segment reported $352,431 thousand [13][14] - The operating margin for Installation was 19.7%, and for Specialty Distribution, it was 15.1% [13][14]