Buoyed by commercial and multifamily wallboard, ceilings, and steel framing volumes that outpaced expectations, Gypsum Management & Supply (GMS) delivered second quarter net sales, net income, and adjusted EBITDA above previously stated forecasts.

“These solid levels of demand [for commercial and multifamily] helped to offset a steeper than anticipated steel pricing decline along with single-family demand that is comparatively reduced versus the prior year, but sequentially improving,” John Turner, president and CEO of GMS, said in a news release.

Net sales in the fiscal second quarter, ended Oct. 31, decreased 0.7% year-over-year to $1.4 billion. Despite softness in the single-family market, the wallboard category experienced only a slight volume decline. GMS said acquisitions also positively contributed to quarterly results.

Wallboard sales increased 0.1% year-over-year to $585.2 million, ceiling sales increased 9.9% to $175.3 million, steel framing sales decreased 16.6% to $232.1 million, and complementary product sales increased 4.8% to $428.3 million. Wallboard volume growth of 17.0% in multifamily and 6.5% in commercial helped to offset single-family volume reductions of 11.4%.

“Our well-balanced product portfolio, with a revenue mix roughly evenly split between commercial and residential construction, allows us to flex our operations to best align with demand as dynamics in our end markets evolve,” Turner said. “In the near term, we anticipate the backlog in multifamily construction to drive continued growth in this end market through the end of fiscal 2024, albeit at declining year-over-year rates.

Turner said commercial demand is also projected to continue its current pace of activity over the next few quarters. GMS is optimistic about improving single-family activity, particularly as it relates to fiscal 2025.

GMS reported a net income of $81.0 million, a decrease of 21.5% compared to the net income in the same period of the last fiscal year. Gross profit in the quarter was $458.6 million, a 1.3% decline compared to the second quarter a year ago. Adjusted EBITDA decreased $28.0 million year-over-year to $167.6 million while adjusted EBITDA margin declined to 11.8% from 13.7%.

“While market conditions are fluid, our scale, wide breadth of product offerings, execution, and expertise across all of our varying end markets, and our commitment to outstanding service continues to position us well for solid financial performance, growth, and realization of value for our shareholders over the long term,” Turner said.