IRVING, Texas - Builders FirstSource, Inc. (NYSE: BLDR) has reported a robust fourth quarter, with earnings per share (EPS) of $3.55, surpassing analysts' expectations by $1.09. The company's revenue reached $4.15B, exceeding the consensus estimate of $4.03B.
This performance marks a significant achievement for the building products supplier, considering the 4.7% YoY decline in net sales, mainly due to a 1.3% drop in core organic net sales and a 5.0% impact from commodity deflation, somewhat mitigated by a 1.6% increase from acquisitions.
Despite the decline in net sales, the company's adjusted EPS saw a 10.6% increase, primarily driven by aggressive share repurchases, which reduced total shares outstanding by 12.2% in 2023. The adjusted EBITDA margin also improved by 50 basis points to 16.5%, thanks to higher gross margins and productivity, despite reduced operating leverage.
CEO Dave Rush expressed pride in the company's fourth-quarter and full-year results, highlighting the strength of their product portfolio and the team's resilience in a challenging environment. The company's focus on operational rigor and customer partnerships contributed to maintaining a high-teens EBITDA margin, even with a significant reduction in single-family starts in 2023.
Looking ahead, Builders FirstSource provided an upbeat outlook for 2024, projecting net sales to be in the range of $17.5B to $18.5B, compared to the analyst consensus of $17.72B. The company expects to continue its strategy of growing value-added products and services, investing in digital innovations, and operating efficiently to compound long-term shareholder value.
The market responded positively to the company's performance and future guidance, with the stock price rising by 5% following the earnings release. This investor confidence is reflected in the company's commitment to returning value to shareholders, as evidenced by the repurchase of $1.8B of shares in 2023 and the Board of Directors' authorization of a new $1.0B share repurchase plan.
CFO Peter Jackson also commented on the results, emphasizing the effectiveness of the company's operating model throughout economic cycles. He noted the strong cash flow generation, prudent capital deployment, and the company's competitive advantages and financial position as key drivers for future growth and value creation for shareholders.
In summary, Builders FirstSource's fourth-quarter performance, coupled with a positive outlook for 2024, has reinforced investor confidence, as evidenced by the stock's significant uptick. The company's strategic focus and strong financial discipline position it well for continued success in the building products industry.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.