Slide 1: First Quarter 2018 Earnings Call
First Quarter 2018 Earnings Call May 10, 2018
Slide 2: Safe Harbor & Non-GAAP Financial Measures
Safe Harbor & Non-GAAP Financial Measures Cautionary Notice Statements in this presentation which are not purely historical facts or which necessarily depend upon future events, including statements about forecasted financial performance or other statements about anticipations, beliefs, expectations
Slide 3: Differentiated, diversified market leader positioned for accelerating growth and expanding profitability
Differentiated, diversified market leader positioned for accelerating growth and expanding profitability Differentiated market leader with exceptional geographic end market diversity Competitively advantaged in a highly fragmented industry Capitalizing on highly favorable housing market dynamics Enh
Slide 4: Builders FirstSource: Differentiated market leader capitalizing on strategic advantages and enhanced focus on growth
Builders FirstSource: Differentiated market leader capitalizing on strategic advantages and enhanced focus on growth One of the largest LBM (Lumber and Building Material) suppliers of building products in the U.S. professional market Margin expansion opportunities with prefabricated components a
Slide 5: Exceptional geographic diversity and balanced end market exposure
Exceptional geographic diversity and balanced end market exposure Diversity, scale and expansive geographic footprint enables exceptional customer reach and less exposure to any one market Presence in 75 of top 100 MSAs and in 40 states National scale facilitates strategic partnerships with cu
Slide 6: Labor shortages and extended building cycle times increase the relative value of our high margin value-added products
Labor shortages and extended building cycle times increase the relative value of our high margin value-added products Investing to drive growth and expand share of wallet in value-added products Capacity expansion In 2018, we are adding 3 new truss manufacturing facilities, 9 additional lines to
Slide 7: Supportive US housing market dynamics and outlook
Supportive US housing market dynamics and outlook U.S. housing starts(1) Professional home improvement products spending(2) Historic Averages: $120 Total 1.5M (SF 1.1M) $100 $80 ($ in billions) (in millions) $60 $40 $20 $0 1992 1996 2000 2004 2008 2012 2016E 2020E Housing starts level is still signi
Slide 8: Priority remains continued focus on growth
Priority remains continued focus on growth Leverage our geographic reach, vendor and customer relationships, and leading Above Market Growth scale to grow faster than the market Continue to expand our salesforce Expansion of Value-Added Significant opportunities exist to increase the penetrati
Slide 9: Leveraging our strengths to accelerate growth and further expand profitability
Leveraging our strengths to accelerate growth and further expand profitability Core Business Organic Operational Existing Growth Investment in Excellence Business Value Added Initiatives (Single family starts Product growth return to historic norm of 1.1M) Strong existing business positioned for a
Slide 10: Initiatives underway, with meaningful value creation
Initiatives underway, with meaningful value creation Estimated Category Summary Description EBITDA Growth Single family starts return to historic norm of 1.1M Core Business Repair and Remodeling growth at ~3% annually ~$250-280M Growth Multi-family starts return to 400K historic norm Grow fa
Slide 11: Adjusted Financial Overview
Adjusted Financial Overview
Slide 12: Q1 2018 Adjusted results
Q1 2018 Adjusted results Net Revenue Bridge Sales per day grew 12.7% over prior year ($ in millions) Sales volume per day +3.9% in single family despite weather related facility closures in the quarter +2.8% sales per day volume growth R&R/Other Commodity price inflation benefited sales by 9
Slide 13: Free cash flow and deleveraging priorities
Free cash flow and deleveraging priorities We believe will enable Builders FirstSource in The following financial attributes… 2018 to… Strong projected free cash flow generation Generate net free cash flow of $170-190M Relatively low capital intensive business Fund capital investments at 1.7% of sal
Slide 14: Appendix - Financial Schedules
Appendix - Financial Schedules
Slide 15: Reconciliation from Net Income to Adjusted EBITDA
Reconciliation from Net Income to Adjusted EBITDA Three months ended March 31, 2018 2017 (in millions) GAAP Net Income $ 23.2 $ 3.8 Integration related expenses 4.4 5.9 Debt issuance and refinancing cost (1) - 2.4 Adjusted Net Income 27.6 12.1 Weighted average diluted common shares (in millions) 116
Slide 16: Adjusted EBITDA Reconciliation by Quarter
Adjusted EBITDA Reconciliation by Quarter Quarter 1 Quarter 2 Quarter 3 Quarter 4 Full Year Quarter 1 T12M 2017 2017 2017 2017 2017 2018 Q1-18 Financial Data Net sales $ 1,533.1 $ 1,843.3 $ 1,878.9 $ 1,778.9 $ 7,034.2 $ 1,700.4 $ 7,201.5 Sales adjustment for closed locations - - - - - - - Net sales
Slide 17: Interest Reconciliation and Debt Outstanding
Interest Reconciliation and Debt Outstanding Three months ended March 31, Adjusted Annual Go (1) Interest Expense Net Debt Outstanding Forward Cash Interest (in millions) 2024 Secured Notes @ 5.625% Fixed $ 10.5 $ 750.0 $ 42.2 (2) 2024 Term Loan @ 4.7% (Floating LIBOR) 5.5 461.8 21.7 Revolving Credi
Slide 18: GAAP Financial Schedules – Income Statement
GAAP Financial Schedules – Income Statement Three Months Ended March 31, 2018 2017 (Unaudited) (In thousands, except per share amounts) Sales $ 1,700,436 $ 1,533,064 Cost of sales 1,289,384 1,157,012 Gross margin 411,052 376,052 Selling, general and administrative expenses 358,908 335,775 Income fro
Slide 19: GAAP Financial Schedules – Balance Sheet
GAAP Financial Schedules – Balance Sheet March 31, December 31, 2018 2017 (Unaudited) (In thousands, except per share amounts) ASSETS Current assets: Cash and cash equivalents $ 10,069 $ 57,533 Accounts receivable, less allowances of $11,874 and $11,771 at March 31, 2018 and December 31, 2017, respe
Slide 20: GAAP Financial Schedules – Cash Flow
GAAP Financial Schedules – Cash Flow Three months ended March 31, 2018 2017 (Unaudited) (In thousands) Cash flows from operating activities: Net income $ 23,220 $ 3,822 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 22,819 23,592 Amortizat
Slide 21: Builders FirstSource
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