- Sales increased 3.4% to $1.3 billion
- Gross margin expanded 190 basis points to 32.0%
- Adjusted EBITDA margin expanded 190 basis points to 20.9%
DAYTONA BEACH, Fla., Aug. 03, 2023 (GLOBE NEWSWIRE) -- TopBuild Corp. (NYSE:BLD), a leading installer and specialty distributor of insulation and related building material products to the construction industry in the United States and Canada today reported results for the second quarter ended June 30, 2023.
Robert Buck, President and Chief Executive Officer, stated, "TopBuild once again delivered strong operating results, as we continue to benefit from a favorable operating environment and maintain our focus on driving improvements at both business segments, Installation and Specialty Distribution. We are also encouraged by the increasing optimism we are hearing from the homebuilders.
"Our commercial and industrial business performance remains strong, with a solid backlog of projects and continued robust bidding activity. We are particularly pleased with how well our Installation branches have successfully grown their light commercial work in their respective regions and believe this will continue to be a growth driver over the long term."
Second Quarter 2023 Financial Highlights ($ in 000s)
(comparisons are to the quarter ended June 30, 2022)
| 3 Months Ended 6/30/23 | Reported | Change |
| Sales | $1,317,262 | 3.4% |
| Gross Margin | 32.0% | 190 bps |
| SG&A as % of revenue | 14.0% | 10 bps |
| Operating Profit | $237,103 | 14.4% |
| Operating Margin | 18.0% | 170 bps |
| Net Income | $164,400 | 14.4% |
| Net Income per diluted share | $5.18 | 17.5% |
| 3 Months Ended 6/30/23 | Adjusted | Change |
| Sales | $1,317,262 | 3.4% |
| Gross Margin | 32.0% | 190 bps |
| SG&A as % of revenue | 13.9% | 10 bps |
| Operating Profit | $239,203 | 14.6% |
| Operating Margin | 18.2% | 180 bps |
| Net Income | $166,685 | 15.4% |
| Net Income per diluted share | $5.25 | 18.5% |
| EBITDA | $275,505 | 13.7% |
| EBITDA Margin | 20.9% | 190 bps |
Six Month Financial Highlights ($ in 000s)
(comparisons are to the six months ended June 30, 2022)
| 6 Months Ended 6/30/23 | Reported | Change |
| Sales | $2,582,500 | 5.7% |
| Gross Margin | 30.7% | 140 bps |
| SG&A as % of revenue | 13.8% | (30 bps) |
| Operating Profit | $436,534 | 17.6% |
| Operating Margin | 16.9% | 170 bps |
| Net Income | $300,270 | 16.2% |
| Net Income per diluted share | $9.47 | 20.3% |
| 6 Months Ended 6/30/23 | Adjusted | Change |
| Sales | $2,582,500 | 5.7% |
| Gross Margin | 30.7% | 140 bps |
| SG&A as % of revenue | 13.5% | (40 bps) |
| Operating Profit | $442,292 | 17.5% |
| Operating Margin | 17.1% | 170 bps |
| Net Income | $305,045 | 17.3% |
| Net Income per diluted share | $9.62 | 21.5% |
| EBITDA | $513,830 | 15.7% |
| EBITDA Margin | 19.9% | 170 bps |
Operating Segment Highlights ($ in 000s)
(comparisons are to the period ended June 30, 2022)
| Installation | 3 Months Ended 6/30/23 | 6 Months Ended 6/30/23 |
| Sales | $809,055 | $1,576,145 |
| Change | ||
| Volume | 2.9% | 4.1% |
| Price | 2.9% | 4.3% |
| M&A | 2.2% | 2.2% |
| Total Change | 8.0% | 10.6% |
| Operating Margin | 21.3% | 20.3% |
| Change | 260 bps | 260 bps |
| Adj. Operating Margin | 21.3% | 20.3% |
| Change | 260 bps | 250 bps |
| Adj. EBITDA Margin | 23.4% | 22.4% |
| Change | 260 bps | 240 bps |
| Specialty Distribution | 3 Months Ended 6/30/23 | 6 Months Ended 6/30/23 |
| Sales | $574,488 | $1,132,862 |
| Change | ||
| Volume | -2.9% | -2.9% |
| Price | 0.6% | 3.0% |
| M&A | 0.0% | 0.0% |
| Total Change | -2.3% | 0.1% |
| Operating Margin | 15.0% | 14.1% |
| Change | 20 bps | 20 bps |
| Adj. Operating Margin | 15.0% | 14.1% |
| Change | 20 bps | 20 bps |
| Adj. EBITDA Margin | 17.6% | 16.7% |
| Change | 40 bps | 20 bps |
Capital Allocation
"We are pleased with our progress to date on the acquisition front, welcoming three profitable and well-managed companies to the TopBuild family. In late July we also announced that we had signed an agreement to acquire SPI, a leading specialty distributor generating approximately $703 million in annual revenue. This acquisition will further enhance our growth platform in the three end-markets we serve and increase our recurring revenue stream from maintenance and repair operations." added Buck.
Year-to-date the Company has completed three acquisitions; SRI Holdings, Best Insulation, and Rocky Mountain Spray Foam which, combined, are expected to contribute approximately $170 million of annual revenue.
2023 Outlook
Sales and Adjusted EBITDA Outlook (1)
($ in millions)
| 2023 | Low | High | ||
| Sales | $ | 5,025 | $ | 5,175 |
| Adjusted EBITDA* | $ | 950 | $ | 1,000 |
*See table for adjusted EBITDA reconciliation.
(1) This outlook reflects management's current view of present and future market conditions and are based on assumptions such as housing starts and completions, general and administrative expenses, weighted average diluted shares outstanding and interest rates. These targets do not include any effects related to potential acquisitions or divestitures that may occur after the date of this press release. A reconciliation of non-GAAP targets to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, the costs and expenses that may be incurred in the future and therefore, cannot be reasonably predicted. The effect of these excluded items may be significant. Factors that could cause actual long-term results to differ materially from TopBuild's current expectations are discussed below and are also detailed in the Company's 2022 Annual Report on Form 10-K and subsequent SEC reports.
Additional Information
Quarterly supplemental materials, including a presentation that will be referenced on today's conference call, are available on the Company's website at www.topbuild.com.
Conference Call
A conference call to discuss second quarter 2023 financial results is scheduled for today, Thursday, August 3, 2023, at 9:00 a.m. Eastern Time. The call may be accessed by dialing (877) 407-9037. The conference call will be webcast simultaneously on the Company's website at www.topbuild.com.
About TopBuild
TopBuild Corp., headquartered in Daytona Beach, Florida, is a leading installer and specialty distributor of insulation and related building material products to the construction industry in the United States and Canada. We provide insulation installation services nationwide through our Installation segment which has approximately 235 branches located across the United States. We distribute building and mechanical insulation, insulation accessories and other building product materials for the residential, commercial, and industrial end markets through our Specialty Distribution business. Our Specialty Distribution network encompasses approximately 170 branches. To learn more about TopBuild please visit our website at www.topbuild.com.
Use of Non-GAAP Financial Measures
Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the "adjusted" financial measures presented above, and figures presented on a "same branch basis" are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP"). The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results under GAAP. Additional information may be found in the Company's filings with the Securities and Exchange Commission which are available on TopBuild's website under "SEC Filings" at www.topbuild.com.
Safe Harbor Statement
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, our expected financial and operational results, the related assumptions underlying our expected results, and our plan to repurchase our common stock under stock repurchase transactions. These forward-looking statements can be identified by words such as "will," "would," "anticipate," "expect," "believe," "designed," "plan," "may," "project," "estimate" or "intend," the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. Our forward-looking statements contained herein speak only as of the date of this press release. Factors or events that we cannot predict, including those described in the risk factors contained in our filings with the Securities and Exchange Commission, may cause our actual results to differ from those expressed in forward-looking statements. Although TopBuild believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved and it undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.
Investor Relations and Media Contact
Tabitha Zane
tabitha.zane@topbuild.com
386-763-8801
| TopBuild Corp. | ||||||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | ||||||||||||||||
| (in thousands, except share and per common share amounts) | ||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Net sales | $ | 1,317,262 | $ | 1,274,285 | $ | 2,582,500 | $ | 2,443,203 | ||||||||
| Cost of sales | 895,462 | 890,188 | 1,790,485 | 1,727,905 | ||||||||||||
| Gross profit | 421,800 | 384,097 | 792,015 | 715,298 | ||||||||||||
| Selling, general, and administrative expense | 184,697 | 176,876 | 355,481 | 344,123 | ||||||||||||
| Operating profit | 237,103 | 207,221 | 436,534 | 371,175 | ||||||||||||
| Other income (expense), net: | ||||||||||||||||
| Interest expense | (18,558 | ) | (13,410 | ) | (36,597 | ) | (25,375 | ) | ||||||||
| Other, net | 4,605 | (279 | ) | 6,528 | 406 | |||||||||||
| Other expense, net | (13,953 | ) | (13,689 | ) | (30,069 | ) | (24,969 | ) | ||||||||
| Income before income taxes | 223,150 | 193,532 | 406,465 | 346,206 | ||||||||||||
| Income tax expense | (58,750 | ) | (49,835 | ) | (106,195 | ) | (87,796 | ) | ||||||||
| Net income | $ | 164,400 | $ | 143,697 | $ | 300,270 | $ | 258,410 | ||||||||
| Net income per common share: | ||||||||||||||||
| Basic | $ | 5.20 | $ | 4.43 | $ | 9.51 | $ | 7.93 | ||||||||
| Diluted | $ | 5.18 | $ | 4.41 | $ | 9.47 | $ | 7.87 | ||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | 31,599,744 | 32,405,292 | 31,575,337 | 32,570,988 | ||||||||||||
| Diluted | 31,731,807 | 32,614,449 | 31,722,660 | 32,827,549 | ||||||||||||
| TopBuild Corp. | |||||||||||||
| Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||||||||
| (in thousands) | |||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||
| Net income | $ | 164,400 | $ | 143,697 | $ | 300,270 | $ | 258,410 | |||||
| Other comprehensive income (loss): | |||||||||||||
| Foreign currency translation adjustment | 4,283 | (2,193 | ) | 6,037 | 1,026 | ||||||||
| Comprehensive income | $ | 168,683 | $ | 141,504 | $ | 306,307 | $ | 259,436 | |||||
| TopBuild Corp. | ||||||||
| Condensed Consolidated Balance Sheets and Other Financial Data (Unaudited) | ||||||||
| (dollars in thousands) | ||||||||
| As of | ||||||||
| June 30, 2023 | December 31, 2022 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 526,327 | $ | 240,069 | ||||
| Receivables, net of an allowance for credit losses of $16,778 at June 30, 2023, and $16,281 at December 31, 2022 | 857,664 | 836,071 | ||||||
| Inventories, net | 385,049 | 438,644 | ||||||
| Prepaid expenses and other current assets | 25,556 | 34,257 | ||||||
| Total current assets | 1,794,596 | 1,549,041 | ||||||
| Right of use assets | 204,044 | 205,892 | ||||||
| Property and equipment, net | 258,746 | 253,484 | ||||||
| Goodwill | 1,991,949 | 1,966,994 | ||||||
| Other intangible assets, net | 595,706 | 614,967 | ||||||
| Other assets | 12,905 | 16,453 | ||||||
| Total assets | $ | 4,857,946 | $ | 4,606,831 | ||||
| LIABILITIES | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 468,602 | $ | 487,114 | ||||
| Current portion of long-term debt | 45,142 | 40,068 | ||||||
| Accrued liabilities | 180,594 | 199,370 | ||||||
| Short-term operating lease liabilities | 61,825 | 60,880 | ||||||
| Short-term finance lease liabilities | 2,180 | 2,207 | ||||||
| Total current liabilities | 758,343 | 789,639 | ||||||
| Long-term debt | 1,394,794 | 1,417,257 | ||||||
| Deferred tax liabilities, net | 254,777 | 251,481 | ||||||
| Long-term portion of insurance reserves | 57,217 | 59,783 | ||||||
| Long-term operating lease liabilities | 148,709 | 149,943 | ||||||
| Long-term finance lease liabilities | 4,519 | 6,673 | ||||||
| Other liabilities | 1,541 | 2,349 | ||||||
| Total liabilities | 2,619,900 | 2,677,125 | ||||||
| EQUITY | 2,238,046 | 1,929,706 | ||||||
| Total liabilities and equity | $ | 4,857,946 | $ | 4,606,831 | ||||
| As of June 30, | ||||||||
| 2023 | 2022 | |||||||
| Other Financial Data | ||||||||
| Receivable days | 50 | 46 | ||||||
| Inventory days | 39 | 48 | ||||||
| Accounts payable days | 64 | 62 | ||||||
| Receivables, net plus inventories, net less accounts payable | $ | 774,111 | $ | 696,615 | ||||
| Receivables, net plus inventories, net less accounts payable as a percent of sales (TTM) † | 14.9 | % | 15.0 | % | ||||
| † Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches | ||||||||
| TopBuild Corp. | ||||||||
| Condensed Consolidated Statement of Cash Flows (Unaudited) | ||||||||
| (in thousands) | ||||||||
| Six Months Ended June 30, | ||||||||
| 2023 | 2022 | |||||||
| Cash Flows Provided by (Used in) Operating Activities: | ||||||||
| Net income | $ | 300,270 | $ | 258,410 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 64,652 | 60,621 | ||||||
| Share-based compensation | 6,886 | 7,061 | ||||||
| Loss on sale of property and equipment | 621 | 525 | ||||||
| Amortization of debt issuance costs | 1,440 | 1,427 | ||||||
| Provision for bad debt expense | 4,031 | 6,404 | ||||||
| Loss from inventory obsolescence | 3,290 | 3,610 | ||||||
| Change in certain assets and liabilities: | ||||||||
| Receivables, net | (37,247 | ) | (107,739 | ) | ||||
| Inventories, net | 54,623 | (82,621 | ) | |||||
| Prepaid expenses and other current assets | 8,897 | 648 | ||||||
| Accounts payable | (8,806 | ) | 47,540 | |||||
| Accrued liabilities | (13,872 | ) | 16,884 | |||||
| Other, net | 1,012 | 4,927 | ||||||
| Net cash provided by operating activities | 385,797 | 217,697 | ||||||
| Cash Flows Provided by (Used in) Investing Activities: | ||||||||
| Purchases of property and equipment | (30,672 | ) | (36,034 | ) | ||||
| Acquisition of businesses, net of cash acquired | (45,948 | ) | (18,746 | ) | ||||
| Proceeds from sale of property and equipment | 782 | 618 | ||||||
| Net cash used in investing activities | (75,838 | ) | (54,162 | ) | ||||
| Cash Flows Provided by (Used in) Financing Activities: | ||||||||
| Repayment of long-term debt | (18,829 | ) | (19,287 | ) | ||||
| Proceeds from revolving credit facility | - | 70,000 | ||||||
| Repayment of revolving credit facility | - | (70,000 | ) | |||||
| Taxes withheld and paid on employees' equity awards | (6,350 | ) | (11,667 | ) | ||||
| Exercise of stock options | 1,497 | 1,452 | ||||||
| Repurchase of shares of common stock | - | (150,050 | ) | |||||
| Payment of contingent consideration | (300 | ) | (35 | ) | ||||
| Net cash used in financing activities | (23,982 | ) | (179,587 | ) | ||||
| Impact of exchange rate changes on cash | 281 | 142 | ||||||
| Net increase (decrease) in cash and cash equivalents | 286,258 | (15,910 | ) | |||||
| Cash and cash equivalents- Beginning of period | 240,069 | 139,779 | ||||||
| Cash and cash equivalents- End of period | $ | 526,327 | $ | 123,869 | ||||
| Supplemental disclosure of noncash activities: | ||||||||
| Leased assets obtained in exchange for new operating lease liabilities | $ | 26,310 | $ | 36,129 | ||||
| Accruals for property and equipment | 1,449 | 563 | ||||||
| TopBuild Corp. | ||||||||||||||||||||||
| Segment Data (Unaudited) | ||||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
| 2023 | 2022 | Change | 2023 | 2022 | Change | |||||||||||||||||
| Installation | ||||||||||||||||||||||
| Sales | $ | 809,055 | $ | 748,968 | 8.0 | % | $ | 1,576,145 | $ | 1,425,661 | 10.6 | % | ||||||||||
| Operating profit, as reported | $ | 172,278 | $ | 139,919 | $ | 319,176 | $ | 252,598 | ||||||||||||||
| Operating margin, as reported | 21.3 | % | 18.7 | % | 20.3 | % | 17.7 | % | ||||||||||||||
| Rationalization charges | - | - | - | 473 | ||||||||||||||||||
| Acquisition related costs | 227 | 16 | 490 | 96 | ||||||||||||||||||
| Operating profit, as adjusted | $ | 172,505 | $ | 139,935 | $ | 319,666 | $ | 253,167 | ||||||||||||||
| Operating margin, as adjusted | 21.3 | % | 18.7 | % | 20.3 | % | 17.8 | % | ||||||||||||||
| Share-based compensation | 310 | 282 | 689 | 689 | ||||||||||||||||||
| Depreciation and amortization | 16,791 | 15,319 | 33,284 | 31,004 | ||||||||||||||||||
| EBITDA, as adjusted | $ | 189,606 | $ | 155,536 | 21.9 | % | $ | 353,639 | $ | 284,860 | 24.1 | % | ||||||||||
| EBITDA margin, as adjusted | 23.4 | % | 20.8 | % | 22.4 | % | 20.0 | % | ||||||||||||||
| Specialty Distribution | ||||||||||||||||||||||
| Sales | $ | 574,488 | $ | 587,791 | (2.3 | )% | $ | 1,132,862 | $ | 1,131,653 | 0.1 | % | ||||||||||
| Operating profit, as reported | $ | 85,980 | $ | 86,749 | $ | 159,313 | $ | 157,170 | ||||||||||||||
| Operating margin, as reported | 15.0 | % | 14.8 | % | 14.1 | % | 13.9 | % | ||||||||||||||
| Acquisition related costs | - | 334 | 340 | 575 | ||||||||||||||||||
| Operating profit, as adjusted | $ | 85,980 | $ | 87,083 | $ | 159,653 | $ | 157,745 | ||||||||||||||
| Operating margin, as adjusted | 15.0 | % | 14.8 | % | 14.1 | % | 13.9 | % | ||||||||||||||
| Share-based compensation | 316 | 287 | 554 | 641 | ||||||||||||||||||
| Depreciation and amortization | 14,740 | 14,005 | 29,312 | 28,034 | ||||||||||||||||||
| EBITDA, as adjusted | $ | 101,036 | $ | 101,375 | (0.3 | )% | $ | 189,519 | $ | 186,420 | 1.7 | % | ||||||||||
| EBITDA margin, as adjusted | 17.6 | % | 17.2 | % | 16.7 | % | 16.5 | % | ||||||||||||||
| TopBuild Corp. | |||||||||||||||||||||||
| Adjusted EBITDA (Unaudited) | |||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2023 | 2022 | Change | 2023 | 2022 | Change | ||||||||||||||||||
| Total net sales | |||||||||||||||||||||||
| Sales before eliminations | $ | 1,383,543 | $ | 1,336,759 | $ | 2,709,007 | $ | 2,557,314 | |||||||||||||||
| Intercompany eliminations | (66,281 | ) | (62,474 | ) | (126,507 | ) | (114,111 | ) | |||||||||||||||
| Net sales after eliminations | $ | 1,317,262 | $ | 1,274,285 | 3.4 | % | $ | 2,582,500 | $ | 2,443,203 | 5.7 | % | |||||||||||
| Operating profit, as reported - segments | $ | 258,258 | $ | 226,668 | $ | 478,489 | $ | 409,768 | |||||||||||||||
| General corporate expense, net | (9,957 | ) | (9,012 | ) | (20,786 | ) | (19,449 | ) | |||||||||||||||
| Intercompany eliminations | (11,198 | ) | (10,435 | ) | (21,169 | ) | (19,144 | ) | |||||||||||||||
| Operating profit, as reported | $ | 237,103 | $ | 207,221 | $ | 436,534 | $ | 371,175 | |||||||||||||||
| Operating margin, as reported | 18.0 | % | 16.3 | % | 16.9 | % | 15.2 | % | |||||||||||||||
| Rationalization charges | - | - | - | 473 | |||||||||||||||||||
| Acquisition related costs † | 2,100 | 1,577 | 5,758 | 4,654 | |||||||||||||||||||
| Operating profit, as adjusted | $ | 239,203 | $ | 208,798 | $ | 442,292 | $ | 376,302 | |||||||||||||||
| Operating margin, as adjusted | 18.2 | % | 16.4 | % | 17.1 | % | 15.4 | % | |||||||||||||||
| Share-based compensation | 3,751 | 3,334 | 6,886 | 7,061 | |||||||||||||||||||
| Depreciation and amortization | 32,551 | 30,122 | 64,652 | 60,621 | |||||||||||||||||||
| EBITDA, as adjusted | $ | 275,505 | $ | 242,254 | 13.7 | % | $ | 513,830 | $ | 443,984 | 15.7 | % | |||||||||||
| EBITDA margin, as adjusted | 20.9 | % | 19.0 | % | 19.9 | % | 18.2 | % | |||||||||||||||
| Sales change period over period | 42,977 | 139,297 | |||||||||||||||||||||
| EBITDA, as adjusted, change period over period | 33,251 | 69,846 | |||||||||||||||||||||
| Incremental EBITDA, as adjusted, as a percentage of change in sales | 77.4 | % | 50.1 | % | |||||||||||||||||||
| † Acquisition related costs include corporate level adjustments as well as segment operating adjustments. | |||||||||||||||||||||||
| TopBuild Corp. | |||||||||||||||||
| Non-GAAP Reconciliations (Unaudited) | |||||||||||||||||
| (in thousands, except share and per common share amounts) | |||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||
| Gross Profit Reconciliation | |||||||||||||||||
| Net sales | $ | 1,317,262 | $ | 1,274,285 | $ | 2,582,500 | $ | 2,443,203 | |||||||||
| Gross profit, as reported | $ | 421,800 | $ | 384,097 | $ | 792,015 | $ | 715,298 | |||||||||
| Acquisition related costs | - | - | - | 121 | |||||||||||||
| Gross profit, as adjusted | $ | 421,800 | $ | 384,097 | $ | 792,015 | $ | 715,419 | |||||||||
| Gross margin, as reported | 32.0 | % | 30.1 | % | 30.7 | % | 29.3 | % | |||||||||
| Gross margin, as adjusted | 32.0 | % | 30.1 | % | 30.7 | % | 29.3 | % | |||||||||
| Selling, General and Administrative Expense Reconciliation | |||||||||||||||||
| Selling, general, and administrative expense, as reported | $ | 184,697 | $ | 176,876 | $ | 355,481 | $ | 344,123 | |||||||||
| Rationalization charges | - | - | - | 473 | |||||||||||||
| Acquisition related costs | 2,100 | 1,577 | 5,758 | 4,533 | |||||||||||||
| Selling, general, and administrative expense, as adjusted | $ | 182,597 | $ | 175,299 | $ | 349,723 | $ | 339,117 | |||||||||
| Operating Profit Reconciliation | |||||||||||||||||
| Operating profit, as reported | $ | 237,103 | $ | 207,221 | $ | 436,534 | $ | 371,175 | |||||||||
| Rationalization charges | - | - | - | 473 | |||||||||||||
| Acquisition related costs | 2,100 | 1,577 | 5,758 | 4,654 | |||||||||||||
| Operating profit, as adjusted | $ | 239,203 | $ | 208,798 | $ | 442,292 | $ | 376,302 | |||||||||
| Operating margin, as reported | 18.0 | % | 16.3 | % | 16.9 | % | 15.2 | % | |||||||||
| Operating margin, as adjusted | 18.2 | % | 16.4 | % | 17.1 | % | 15.4 | % | |||||||||
| Income Per Common Share Reconciliation | |||||||||||||||||
| Income before income taxes, as reported | $ | 223,150 | $ | 193,532 | $ | 406,465 | $ | 346,206 | |||||||||
| Rationalization charges | - | - | - | 473 | |||||||||||||
| Acquisition related costs | 2,100 | 1,577 | 5,758 | 4,654 | |||||||||||||
| Income before income taxes, as adjusted | 225,250 | 195,109 | 412,223 | 351,333 | |||||||||||||
| Tax rate at 26.0% | (58,565 | ) | (50,728 | ) | (107,178 | ) | (91,347 | ) | |||||||||
| Income, as adjusted | $ | 166,685 | $ | 144,381 | $ | 305,045 | $ | 259,986 | |||||||||
| Income per common share, as adjusted | $ | 5.25 | $ | 4.43 | $ | 9.62 | $ | 7.92 | |||||||||
| Weighted average diluted common shares outstanding | 31,731,807 | 32,614,449 | 31,722,660 | 32,827,549 | |||||||||||||
| TopBuild Corp. | ||||||||||||||||
| Same Branch and Acquisition Metrics (Unaudited) | ||||||||||||||||
| (dollars in thousands) | ||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Net sales | ||||||||||||||||
| Same branch: | ||||||||||||||||
| Installation | $ | 792,529 | $ | 748,968 | $ | 1,544,775 | $ | 1,425,661 | ||||||||
| Specialty Distribution | 574,488 | 587,791 | 1,132,862 | 1,131,653 | ||||||||||||
| Eliminations | (66,281 | ) | (62,474 | ) | (126,507 | ) | (114,111 | ) | ||||||||
| Total same branch | 1,300,736 | 1,274,285 | 2,551,130 | 2,443,203 | ||||||||||||
| Acquisitions (a): | ||||||||||||||||
| Installation | $ | 16,526 | $ | - | $ | 31,370 | $ | - | ||||||||
| Total acquisitions | 16,526 | - | 31,370 | - | ||||||||||||
| Total | $ | 1,317,262 | $ | 1,274,285 | $ | 2,582,500 | $ | 2,443,203 | ||||||||
| EBITDA, as adjusted | ||||||||||||||||
| Same branch | $ | 272,939 | $ | 242,254 | $ | 509,715 | $ | 443,984 | ||||||||
| Acquisitions (a) | 2,566 | - | 4,115 | - | ||||||||||||
| Total | $ | 275,505 | $ | 242,254 | $ | 513,830 | $ | 443,984 | ||||||||
| EBITDA, as adjusted, as a percentage of sales | ||||||||||||||||
| Same branch (b) | 21.0 | % | 20.0 | % | ||||||||||||
| Acquisitions (c) | 15.5 | % | 13.1 | % | ||||||||||||
| Total (d) | 20.9 | % | 19.0 | % | 19.9 | % | 18.2 | % | ||||||||
| As Adjusted Incremental EBITDA, as a percentage of change in sales | ||||||||||||||||
| Same branch (e) | 116.0 | % | 60.9 | % | ||||||||||||
| Acquisitions (c) | 15.5 | % | 13.1 | % | ||||||||||||
| Total (f) | 77.4 | % | 50.1 | % | ||||||||||||
| (a) Represents current year impact of acquisitions in their first twelve months | ||||||||||||||||
| (b) Same branch metric, as adjusted, as a percentage of same branch sales | ||||||||||||||||
| (c) Acquired metric, as adjusted, as a percentage of acquired sales | ||||||||||||||||
| (d) Total EBITDA, as adjusted, as a percentage of total sales | ||||||||||||||||
| (e) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales | ||||||||||||||||
| (f) Change in total EBITDA, as adjusted, as a percentage of change in total sales | ||||||||||||||||
| TopBuild Corp. | ||||||||||||
| Reconciliation of Adjusted EBITDA to Net Income (Unaudited) | ||||||||||||
| (in thousands) | ||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||
| Net income, as reported | $ | 164,400 | $ | 143,697 | $ | 300,270 | $ | 258,410 | ||||
| Adjustments to arrive at EBITDA, as adjusted: | ||||||||||||
| Interest expense and other, net | 13,953 | 13,689 | 30,069 | 24,969 | ||||||||
| Income tax expense | 58,750 | 49,835 | 106,195 | 87,796 | ||||||||
| Depreciation and amortization | 32,551 | 30,122 | 64,652 | 60,621 | ||||||||
| Share-based compensation | 3,751 | 3,334 | 6,886 | 7,061 | ||||||||
| Rationalization charges | - | - | - | 473 | ||||||||
| Acquisition related costs | 2,100 | 1,577 | 5,758 | 4,654 | ||||||||
| EBITDA, as adjusted | $ | 275,505 | $ | 242,254 | $ | 513,830 | $ | 443,984 | ||||
| TopBuild Corp. | ||||||||||||||
| Acquisition Adjusted Net Sales (Unaudited) | ||||||||||||||
| (in thousands) | ||||||||||||||
| 2022 | 2023 | Trailing Twelve Months Ended | ||||||||||||
| Q3 | Q4 | Q1 | Q2 | June 30, 2023 | ||||||||||
| Net Sales | $ | 1,300,998 | $ | 1,264,543 | $ | 1,265,238 | $ | 1,317,262 | $ | 5,148,041 | ||||
| Acquisitions proforma adjustment † | 17,576 | 18,279 | 6,187 | - | 42,042 | |||||||||
| Net sales, acquisition adjusted | $ | 1,318,574 | $ | 1,282,822 | $ | 1,271,425 | $ | 1,317,262 | $ | 5,190,083 | ||||
| † Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches | ||||||||||||||
| TopBuild Corp. | ||||||
| 2023 Estimated Adjusted EBITDA Range (Unaudited) | ||||||
| (in millions) | ||||||
| Twelve Months Ending December 31, 2023 | ||||||
| Low | High | |||||
| Estimated net income | $ | 543.0 | 586.0 | |||
| Adjustments to arrive at estimated EBITDA, as adjusted: | ||||||
| Interest expense and other, net | 62.0 | 59.0 | ||||
| Income tax expense | 191.0 | 206.0 | ||||
| Depreciation and amortization | 131.0 | 128.0 | ||||
| Share-based compensation | 15.0 | 14.0 | ||||
| Acquisition related costs | 8.0 | 7.0 | ||||
| Estimated EBITDA, as adjusted | $ | 950.0 | $ | 1,000.0 | ||
