Core Insights - The company reported a 9% decline in total net sales to $900 million in fiscal Q1 2026, attributed to inventory normalization and softer global demand [5][53] - North American net sales fell 12%, driven by lower volumes, although there was a 3% increase in average net sales price [6][54] - Adjusted EBITDA decreased by 21% year-over-year to $226 million, with a margin of 25.1%, reflecting volume pressures and raw material inflation [3][53] Financial Performance - Adjusted EBITDA margin fell 370 basis points to 25.1% in Q1 2026, with North America adjusted EBITDA margin down 400 basis points year-over-year [3][6] - Free cash flow improved by 88% to $104 million due to better operating cash generation and reduced capital expenditures [7][53] - The company expects free cash flow of at least $200 million for fiscal 2026, with capital expenditures projected at approximately $400 million [10][63] Market Outlook - Guidance for fiscal 2026 anticipates a high single-digit decline in total market demand, influenced by homeowner affordability pressures and uncertain macro conditions [3][61] - The company expects adjusted EBITDA for fiscal 2026 to be between $1.05 billion and $1.15 billion, including a contribution of $250 million to $265 million from the AZEK acquisition [9][62] - North America fiber cement outlook predicts a low double-digit volume decline for fiscal 2026, primarily volume-driven [11] Strategic Initiatives - The completion of the AZEK acquisition has doubled the company's total addressable market and expanded its product offerings [8][19] - The company aims to achieve over $500 million in commercial synergies within five years, with benefits expected to begin in fiscal 2027 [12][50] - Management is focused on integrating operations and realizing cost synergies, with over 50% of targeted general and administrative cost synergies already actioned [8][44] Regional Performance - Asia Pacific net sales declined 10%, with a 25% volume decrease offset by a 22% rise in average selling price [7][57] - Europe experienced a 7% increase in net sales, driven by higher average selling prices, with an EBITDA margin improvement to 16% [7][59] - The company remains committed to outperforming market demand in both APAC and Europe despite challenging conditions [58][60]