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Beacon Roofing's (BECN) Q1 Earnings & Revenues Top Estimates
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Beacon Roofing Supply, Inc. (BECN - Free Report) reported results for the first quarter of 2022. Earnings and revenues handily surpassed their respective Zacks Consensus Estimate and improved significantly on a year-over-year basis. The solid results were mainly backed by strong net sales, gross margin expansion and operational improvement.
Meanwhile, the company increased its expectation for 2022 adjusted EBITDA in the range of $800-850 million.
Julian Francis, Beacon’s president and CEO, said, “Strong demand for our products, disciplined execution and productivity gains led to impressive top-line and bottom-line performance. This quarter also marked the beginning of our journey to achieve our Ambition 2025 financial targets detailed at our investor day in February.”
Earnings & Revenue Discussion
This distributor of residential and non-residential roofing materials reported adjusted earnings of 89 cents per share, which handily topped the consensus mark of 49 by 81.6%.
For the quarter, net sales of $1.69 billion surpassed the consensus mark of $1.43 billion by 18%. The top line grew 28% on a year-over-year basis as sales increased across all three lines of business, given the higher pricing. Higher demand from non-residential roofing products also contributed to the growth.
Sales According to Line of Business
Residential Roofing Product: For the reported quarter, sales of this product (comprising 50% of the quarterly net sales) were $846 million, up 21.8% from the prior year.
Non-Residential Roofing Product: Sales (comprising 21% of the quarterly net sales) increased 47.9% from the year-ago quarter to $488 million.
Complementary Product: For the quarter, sales of this product (comprising 29% of the quarterly net sales) increased 20.3% year over year to $353 billion.
Beacon Roofing Supply, Inc. Price, Consensus and EPS Surprise
Gross margin of 26.1% grew 80 basis points (bps) year over year, owing to disciplined pricing in a volatile, supply-constrained marketplace and effective and timely sourcing. As a percentage of net sales, operating expenses dropped 190 bps to 19.2%, driven by the positive impact from net sales growth as well as productivity gains.
Adjusted EBITDA increased 87.5% on a year-over-year basis to $139.5 million, as productivity gains generated favorable operating cost leverage. Adjusted EBITDA margin expanded 270 bps year over year to 8.3%.
Other Financial Details
As of Mar 31, 2022, Builders FirstSource had cash and cash equivalents of $52.4 million compared with $225.8 million at 2021-end. Long-term debt — net of current portion — was $1.611 billion, slightly down from $1.612 billion at 2021-end.
Notably, BECN has opened two greenfield locations & a Beacon OTC Network hub, and expanded footprint in key markets with successful acquisitions.
Q2 Guidance
The company expects second-quarter net sales to grow in the low 20% on a year-over-year basis. Gross margins for the quarter are expected between 27-27.5%.
Fastenal Company (FAST - Free Report) started 2022 on a solid note. The company’s first-quarter 2022 earnings and revenues not only beat the Zacks Consensus Estimate but also improved on a year-over-year basis.
Fastenal’s quarterly results benefited from strong demand for manufacturing and construction equipment and supplies along with higher pricing.
Quanta Services Inc. (PWR - Free Report) reported impressive results for first-quarter 2022. Adjusted earnings and revenues surpassed the Zacks Consensus Estimate and increased impressively on a year-over-year basis.
Quanta’s adjusted earnings increased 65.1% from the year-ago period. The upside was backed by revenue growth across the segments, record total backlog, and a solid and safe project execution.
KBR, Inc. (KBR - Free Report) reported mixed results for first-quarter 2022, with earnings topping the Zacks Consensus Estimate and revenues missing the same.
On a year-over-year basis, the metrics increased strongly. KBR benefited from solid Government Solutions growth and strong execution across the business.
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Beacon Roofing's (BECN) Q1 Earnings & Revenues Top Estimates
Beacon Roofing Supply, Inc. (BECN - Free Report) reported results for the first quarter of 2022. Earnings and revenues handily surpassed their respective Zacks Consensus Estimate and improved significantly on a year-over-year basis. The solid results were mainly backed by strong net sales, gross margin expansion and operational improvement.
Meanwhile, the company increased its expectation for 2022 adjusted EBITDA in the range of $800-850 million.
Julian Francis, Beacon’s president and CEO, said, “Strong demand for our products, disciplined execution and productivity gains led to impressive top-line and bottom-line performance. This quarter also marked the beginning of our journey to achieve our Ambition 2025 financial targets detailed at our investor day in February.”
Earnings & Revenue Discussion
This distributor of residential and non-residential roofing materials reported adjusted earnings of 89 cents per share, which handily topped the consensus mark of 49 by 81.6%.
For the quarter, net sales of $1.69 billion surpassed the consensus mark of $1.43 billion by 18%. The top line grew 28% on a year-over-year basis as sales increased across all three lines of business, given the higher pricing. Higher demand from non-residential roofing products also contributed to the growth.
Sales According to Line of Business
Residential Roofing Product: For the reported quarter, sales of this product (comprising 50% of the quarterly net sales) were $846 million, up 21.8% from the prior year.
Non-Residential Roofing Product: Sales (comprising 21% of the quarterly net sales) increased 47.9% from the year-ago quarter to $488 million.
Complementary Product: For the quarter, sales of this product (comprising 29% of the quarterly net sales) increased 20.3% year over year to $353 billion.
Beacon Roofing Supply, Inc. Price, Consensus and EPS Surprise
Beacon Roofing Supply, Inc. price-consensus-eps-surprise-chart | Beacon Roofing Supply, Inc. Quote
Operating Highlights
Gross margin of 26.1% grew 80 basis points (bps) year over year, owing to disciplined pricing in a volatile, supply-constrained marketplace and effective and timely sourcing. As a percentage of net sales, operating expenses dropped 190 bps to 19.2%, driven by the positive impact from net sales growth as well as productivity gains.
Adjusted EBITDA increased 87.5% on a year-over-year basis to $139.5 million, as productivity gains generated favorable operating cost leverage. Adjusted EBITDA margin expanded 270 bps year over year to 8.3%.
Other Financial Details
As of Mar 31, 2022, Builders FirstSource had cash and cash equivalents of $52.4 million compared with $225.8 million at 2021-end. Long-term debt — net of current portion — was $1.611 billion, slightly down from $1.612 billion at 2021-end.
Notably, BECN has opened two greenfield locations & a Beacon OTC Network hub, and expanded footprint in key markets with successful acquisitions.
Q2 Guidance
The company expects second-quarter net sales to grow in the low 20% on a year-over-year basis. Gross margins for the quarter are expected between 27-27.5%.
Zacks Rank & Peer Release
Beacon Roofing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
Fastenal Company (FAST - Free Report) started 2022 on a solid note. The company’s first-quarter 2022 earnings and revenues not only beat the Zacks Consensus Estimate but also improved on a year-over-year basis.
Fastenal’s quarterly results benefited from strong demand for manufacturing and construction equipment and supplies along with higher pricing.
Quanta Services Inc. (PWR - Free Report) reported impressive results for first-quarter 2022. Adjusted earnings and revenues surpassed the Zacks Consensus Estimate and increased impressively on a year-over-year basis.
Quanta’s adjusted earnings increased 65.1% from the year-ago period. The upside was backed by revenue growth across the segments, record total backlog, and a solid and safe project execution.
KBR, Inc. (KBR - Free Report) reported mixed results for first-quarter 2022, with earnings topping the Zacks Consensus Estimate and revenues missing the same.
On a year-over-year basis, the metrics increased strongly. KBR benefited from solid Government Solutions growth and strong execution across the business.