Beacon Roofing Supply reports dip in Q1 sales and earnings

Beacon Roofing Supply Inc. (NASDAQ:BECN), a leading distributor of roofing materials and building supplies with a market capitalization of $7.65 billion, reported a decrease in net sales and adjusted EBITDA for the first quarter ended March 31, 2025, as per the company’s preliminary financial results disclosed today. Despite the stock trading near its 52-week high of $123.90 and posting a strong six-month return of 31.5%, InvestingPro data shows that 12 analysts have recently revised their earnings expectations downward for the upcoming period.

The company has not finalized its financial statements for the quarter, but based on preliminary data, Beacon expects net sales to range between $1.898 billion and $1.918 billion, compared to $1.912 billion in the same period last year. The slight decline in sales is attributed to one less selling day in the quarter compared to the previous year. According to InvestingPro analysis, the company maintains strong liquidity with a current ratio of 1.97, indicating robust ability to meet short-term obligations.

Beacon Roofing Supply also anticipates a net loss of $41.3 million to $45.3 million for the quarter, a stark contrast to the net income of $5.6 million reported in the first quarter of 2024. The expected adjusted EBITDA is projected to be between $80.0 million and $84.0 million, down from $103.1 million a year ago.

The decrease in profitability is primarily driven by higher operating expenses, lower gross margins from sales mix, and increased interest expenses. Capital expenditures are estimated to be significantly lower, ranging from $10.0 million to $15.0 million, compared to $27.0 million in the prior year’s quarter.

The company’s preliminary financial results also include a reconciliation of GAAP net loss to non-GAAP adjusted EBITDA, which excludes certain items such as interest expense, income taxes, depreciation and amortization, stock-based compensation, acquisition costs, and restructuring costs.

These preliminary results are subject to the completion of financial and accounting review procedures and could change. The company has cautioned that the figures provided are not a substitute for the consolidated financial statements prepared in accordance with GAAP.

Beacon Roofing Supply’s forward-looking statements included in the SEC filing are based on management’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially.

This news is based on a press release statement and reflects the company’s performance as of the date of the report, without speculation on future implications or industry trends.

In other recent news, QXO, Inc. has extended its tender offer to acquire Beacon Roofing Supply, Inc., with the offer now open until April 28, 2025. This acquisition, valued at approximately $11 billion, has received unanimous approval from Beacon’s board, who recommend shareholders tender their shares for $124.35 each. The transaction has cleared antitrust reviews in the U.S. and Canada and is expected to close by the end of April. Both BMO Capital Markets and RBC Capital Markets have downgraded Beacon Roofing’s stock rating, aligning their price targets with the acquisition offer of $124.35 per share. RBC noted that Beacon’s preliminary first-quarter results were slightly better than expected, although the company canceled a planned investor day. Additionally, Beacon Roofing announced the sudden resignation of Executive Vice President and Chief Commercial Officer James J. Gosa, effective March 20, 2025. The company has not disclosed further details regarding his departure or named a successor. These developments underscore a period of significant transition for Beacon Roofing Supply as it moves towards finalizing the acquisition by QXO.

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