TopBuild Discusses Growth Opportunities at Investor Day
October 03 2017 - 12:00PM
Outlines Key Areas of Focus Provides
Revenue and Adjusted EBITDA Guidance for 2017 and Long-Term
Targets Related to Key Financial Metrics
TopBuild Corp. (NYSE:BLD), the leading purchaser,
installer and distributor of insulation products to the U.S.
construction industry, hosted its inaugural investor day in New
York City today to discuss growth opportunities and key areas of
focus for its business segments.
Jerry Volas, Chief Executive Officer, stated,
“We are very excited about the multiple growth opportunities for
our Company. We are leveraging our scale and deep customer
and supplier relationships to drive results, our culture is
promoting and rewarding an entrepreneurial spirit, we are
attracting top talent at all levels, and we are driving operational
excellence throughout our organization.
“As noted in today’s presentations, over the
past two years we have enhanced our business model, diversified our
business mix and expanded our operating margins. With annual
residential new housing starts still far below the fifty-year
average of 1.5 million, we believe the current housing recovery has
plenty of room to grow. In addition, we envision our
commercial business revenue continuing to expand at a minimum of
12% per year.”
The Company also provided revenue and adjusted
EBITDA guidance for 2017 as well as long-term targets for certain
key financial metrics.
Annual Guidance(1)
2017 |
Low |
High |
Revenue |
$1,880M |
$1,905M |
Adjusted EBITDA* |
$183M |
$193M |
See table
for adjusted EBITDA reconciliation |
Long-Term Targets (3-Years)(1)
Metric |
Range |
Working Capital (% of Sales) |
7% to 8% |
CapEx (% of Sales) |
2% to 2.5% |
Normalized Tax Rate |
38 |
% |
Commercial Annual Revenue Growth |
12%+ |
Incremental Adjusted EBITDA (Organic) |
22% to 27% |
Incremental Adjusted EBITDA (Acquisitions Year One) |
11% to 16% |
(1) This outlook reflects management’s current view of present
and future market conditions and is based on assumptions such as
housing starts, general and administrative expenses, weighted
average diluted shares outstanding and interest rates. This
outlook does not include any effects related to potential
acquisitions or divestitures that may occur after the date of this
press release. Factors that could cause actual 2017 results
to differ materially from TopBuild’s current expectations are
discussed below and are also detailed in the Company’s 2016 Annual
Report on Form 10-K and subsequent SEC reports.
Use of Non-GAAP Financial
Measures EBITDA and incremental EBITDA margin 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. 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 “Investors” at
www.topbuild.com.
Safe Harbor StatementStatements contained in
this press release that are not historical and reflect our views
about future periods and events, including, without limitation, our
expected financial and operational performance, constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by words such as “will,” “would,”
“anticipate,” “expect,” “believe,” “plan,” “hope,” “estimates,”
“suggests,” “has the potential to,” “projects,” “assumes,” “goal,”
“targets,” “likely,” “should” or “intend,” and other words and
phrases of similar meanings, the negative of these terms, and
similar references to anticipated or expected events, activities,
trends, future periods or results. Forward-looking statements are
based on management’s current expectations and are subject to risks
and uncertainties that are difficult to predict and, accordingly,
our actual results may differ materially from the results discussed
or implied in our forward-looking statements. Forward-looking
statements are subject to a number of risks, uncertainties, and
assumptions including our reliance on residential new
construction, residential repair/remodel, and commercial
construction; our reliance on third-party suppliers and
manufacturers; our ability to attract, develop and retain talented
personnel and our sales and labor force; our ability to maintain
consistent practices across our locations; our ability to maintain
our competitive position; our ability to integrate acquisitions;
changes in the costs of the products we install and/or distribute;
increases in fuel costs; significant competition in our industry;
seasonal effects on our business; and the other risks described
under the caption entitled “Risk Factors” in our most recent Annual
Report on Form 10-K filed with the SEC and under similar headings
in our subsequently filed Quarterly Reports on Forms 10-Q and other
filings with the SEC. Our forward-looking statements in this
press release speak only as of the date of this press
release. Factors or events that could cause our actual
results to differ may emerge from time to time, and it is not
possible for us to predict all of them. Unless required by
law, we undertake no obligation to update publicly any
forward-looking statements as a result of new information, future
events, or otherwise.
About TopBuildTopBuild Corp.,
headquartered in Daytona Beach, Florida, is the leading purchaser,
installer and distributor of insulation products to the U.S.
construction industry. We provide insulation services nationwide
through TruTeam®, which has over 175 branches, and through Service
Partners® which distributes insulation from over 70 branches.
We leverage our national footprint to gain economies of scale while
capitalizing on our local market presence to forge strong
relationships with our customers. To learn more about
TopBuild please visit our website at www.topbuild.com.
Investor Relations and Media
ContactTabitha
Zanetabitha.zane@topbuild.com386-763-8801
TopBuild Corp. |
Reconciliation of EBITDA to Net Income |
(dollars in thousands) |
|
|
|
|
|
2017E |
|
|
|
|
|
Low |
|
High |
Net
Income, as reported |
|
|
$ |
70.6 |
|
$ |
77.6 |
Adjustments to arrive at EBITDA, as adjusted: |
|
|
|
Interest expense and other, net |
|
|
8.0 |
|
|
7.6 |
Income tax expense from continuing operations |
|
43.3 |
|
|
47.6 |
Depreciation and amortization |
|
|
16.1 |
|
|
15.7 |
Share-based compensation |
|
|
10.5 |
|
|
10.0 |
Significant legal settlement |
|
|
30.0 |
|
|
30.0 |
Rationalization charges |
|
|
|
3.0 |
|
|
3.0 |
Loss on extinguishment of debt |
|
|
1.1 |
|
|
1.1 |
Acquisition related costs |
|
|
|
0.4 |
|
|
0.4 |
EBITDA as adjusted |
|
|
$ |
183.0 |
|
$ |
193.0 |
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