Slide 1: Fourth Quarter and Fiscal 2017 Earnings Call
Fourth Quarter and Fiscal 2017 Earnings Call March 1, 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 4 new truss manufacturing facilities brought on line in 2017, and improved product
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: Executed on our 2017 priorities
Executed on our 2017 priorities Leverage our geographic reach, vendor and 2017 revenue growth of 10.7% Above Market Growth customer relationships, and leading scale to grow faster than the market Added +120 sales professionals and trainees in 2017 Continue to expand our salesforce Significan
Slide 9: What's Next? Leveraging our strengths to accelerate growth
What’s Next? 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 pos
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 ~$250-280M Growth Multi-family starts return to 400K historic norm Grow fa
Slide 11: Pro Forma Adjusted Financial Overview
Pro Forma Adjusted Financial Overview
Slide 12: Q4 2017 Adjusted results
Q4 2017 Adjusted results Net Revenue Bridge ($ in millions) Sales per day excluding closed locations grew 13.2% over prior year Sales volume per day +7.5% in single family +5.2% sales per day volume growth R&R/Other Commodity price inflation benefited sales by 7.6% Market declines in multi
Slide 13: 2017 Financial Highlights
2017 Financial Highlights Sales grew 10.7% over prior year, excluding closed locations SG&A as a percentage of sales, reduced by 90 bps vs prior year, including $9.7 million investment in growth initiatives, including sales associates and new locations Adjusted net income improved $55M, or $0.
Slide 14: 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 15: Appendix - Financial Schedules
Appendix - Financial Schedules
Slide 16: Reconciliation from Net Income to Adjusted EBITDA
Reconciliation from Net Income to Adjusted EBITDA Three months ended Twelve months ended December 31, December 31, 2017 2016 2017 2016 (in $ millions) Reported GAAP Net Income $ (42.7) $ 6.4 $ 38.8 $ 144.3 Integration related expenses 4.0 5.1 20.7 26.0 Debt issuance and refinancing cost (1) 56.3 9.7
Slide 17: Adjusted EBITDA Reconciliation by Quarter
Adjusted EBITDA Reconciliation by Quarter Quarter 1 Quarter 2 Quarter 3 Quarter 4 Fiscal Quarter 1 Quarter 2 Quarter 3 Quarter 4 Full Year 2016 2016 2016 2016 2016 2017 2017 2017 2017 2017 Financial Data Pro forma net sales $ 1,397.1 $ 1,677.3 $ 1,746.0 $ 1,546.9 $ 6,367.3 $ 1,533.1 $ 1,843.3 $ 1,87
Slide 18: Interest Reconciliation and Debt Outstanding
Interest Reconciliation and Debt Outstanding Three months ended December 31, 2017 Net Debt Adjusted Annual Go Interest Expense Outstanding Forward Cash Interest (1) (in millions) 2024 Secured Notes @ 5.625% Fixed $ 10.5 $ 750.0 $ 42.2 2023 Unsecured Notes at 10.75% Fixed 9.7 2024 Term Loan @ 4.7% (F
Slide 19: GAAP Financial Schedules – Income Statement 4Q17
GAAP Financial Schedules – Income Statement 4Q17 Three Months Ended December 31, 2017 2016 (In thousands, except per share amounts) Sales $ 1,778,939 $ 1,546,912 Cost of sales 1,347,719 1,155,337 Gross margin 431,220 391,575 Selling, general and administrative expenses 366,419 340,697 Income from op
Slide 20: GAAP Financial Schedules – Income Statement 2017
GAAP Financial Schedules – Income Statement 2017 Years Ended December 31, 2017 2016 (In thousands, except per share amounts) Sales $ 7,034,209 $ 6,367,284 Cost of sales 5,306,818 4,770,536 Gross margin 1,727,391 1,596,748 Selling, general and administrative expenses 1,442,288 1,360,412 Income from o
Slide 21: GAAP Financial Schedules – Balance Sheet
GAAP Financial Schedules – Balance Sheet December 31, 2017 2016 (In thousands, except per share amounts) ASSETS Current assets: Cash and cash equivalents $ 57,533 $ 14,449 Accounts receivable, less allowances of $11,771 and $11,571 at December 31, 2017 and 2016, respectively 631,992 569,208 Other re
Slide 22: GAAP Financial Schedules – Cash Flow
GAAP Financial Schedules – Cash Flow Years Ended December 31, 2017 2016 Cash flows from operating activities: Net income $ 38,781 $ 144,341 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 92,993 109,793 Amortization and write-off of deb
Slide 23: p SBuilders
p SBuilders 4FirstSource