Improving residential market conditions helped drive a 6.2% year-over-year increase in net sales to $2.5 billion for Beacon in the second quarter, a quarterly record for the distributor. In addition to improving conditions, Beacon said the improvement in sales was driven by higher prices and the contributions of acquired or newly opened branches over the past four quarters.
“Our team’s focused execution on the Ambition 2025 growth initiatives drove record quarterly net sales, strong net income margin, and double-digit adjusted EBITDA margin,” Julian Francis, president and CEO of Beacon, said in a prepared statement. “I am especially pleased with the growth of our industry-leading digital offering, achieving record adoption by our residential customers.”
Residential roofing product sales increased 8.5% year-over-year in the second quarter, non-residential roofing product sales decreased 1.7%, and complementary product sales increased 11.6%. Beacon attributed the complementary product sales increase to the November 2022 acquisition of Coastal Construction Products.
“Our relentless customer focus is propelling the team to help our customers build more. Internally, our emphasis on efficiency is also showing tangible results, demonstrated by our impressive operating expense to net sales ratio,” Francis said.
In the quarter, Beacon reported gross margin decreased 220 basis points to 25.4%, as higher product costs related to the inventory profit roll-off offset higher average selling prices.
Net income was $153.8 million in the period, compared to $174.5 million in the second quarter of 2022. Adjusted EBITDA was $290.3 million, compared to $307.7 million in the prior year.