Capitalizing on non-discretionary repair and reroofing spending in the third quarter, Beacon delivered record quarterly net sales and its highest adjusted EBITDA in history.
“Beacon’s third quarter results were outstanding, reflecting our team’s high caliber execution of our Ambition 2025 strategic plan and the power of our business model,” Julian Francis, Beacon’s president and CEO, said. “We demonstrated that we have multiple levers of growth and can achieve results in any environment.”
In addition to non-discretionary repair and reroofing, Francis said the company remained focused on items within its control, including “disciplined pricing, labor productivity, and working capital management.”
As a result of these efforts, Beacon reported net sales increased 7.0% compared to the prior-year quarter to $2.58 billion. The increase was driven by contributions of acquired branches and greenfields over the last four quarters. Organic volumes increased approximately 1% to 2% year-over-year.
Residential roofing product sales increased 13.6%, non-residential roofing product sales decreased 7.6%, and complementary product sales increased 12.7% compared to the prior year. Beacon said the increase in residential roofing was primarily due to higher volumes while the increase in complementary product sales was due to its November 2022 acquisition of Coastal Construction Products.
“We built on our track record of value-creating M&A, including meaningful expansion to our waterproofing footprint,” Francis said. “We’ve continued to add greenfield branch locations to enhance our organic growth potential.”
Gross margin in the quarter decreased slightly to 26.0% from 26.1% in the prior year, as higher product costs offset higher average selling prices.
Beacon reported a net income of $161.3 million, compared to $514.8 million in the third quarter 2022. Adjusted EBITDA increased to $309.6 million from $284.2 million in the third quarter of 2022. Beacon said third quarter results were driven by higher net sales and operating leverage.
