HERNDON, Va. - Beacon Roofing Supply, Inc. (NASDAQ:BECN), a leading distributor of roofing materials and complementary building products, reported its first-quarter financial results, missing analyst earnings per share (EPS) expectations but surpassing revenue forecasts.
For the quarter ended March 31, 2024, the company recorded an EPS of $0.09, falling short of the analyst consensus of $0.25 by $0.16. However, Beacon's revenue reached a record $1.91 billion, exceeding the consensus estimate of $1.88 billion.
The company's net sales showed a robust increase of 10.4% compared to the same quarter last year, driven by organic volume growth across all three lines of business, including greenfields, and contributions from acquired branches. Residential roofing product sales rose by 9.1%, non-residential roofing product sales by 17.6%, and complementary product sales by 5.4%. Despite these gains, Beacon's gross margin declined to 24.7% from 25.5% in the previous year, impacted by modestly higher product costs and a higher non-residential product mix.
Julian Francis, Beacon's President & CEO, attributed the record sales to the resilience of the company's business model and better-than-expected gross margins. He highlighted the company's strategic initiatives under Ambition 2025, which include growth in digital, an expanded private label product offering, and customer experience enhancements. Francis also noted the recent acquisition of Smalley & Company, which is expected to bolster Beacon's specialty waterproofing distribution platform.
Despite the positive revenue performance, net income decreased to $5.6 million from $24.8 million in the prior year, and adjusted EBITDA dropped to $103.1 million from $113.0 million.
Beacon's continued expansion through acquisitions and new branch openings, coupled with its focus on non-discretionary repair and reroofing demand, positions the company to capitalize on the supportive fundamentals of its end markets. As the construction season progresses, Beacon aims to leverage its product offerings and service capabilities to meet customer needs effectively.
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