Slide 1: Fourth Quarter and Fiscal 2016 Earnings Call
Fourth Quarter and Fiscal 2016 Earnings Call March 1, 2017
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, and uniquely positioned for ongoing profitable growth
Differentiated, diversified, and uniquely positioned for ongoing profitable growth Differentiated market leader in a highly fragmented industry Geographic and end market diversity Favorable housing cycle dynamics Potential for continued market share gains and ongoing shift towards higher margin prod
Slide 4: Builders FirstSource: Differentiated market leader in highly fragmented industry
Builders FirstSource: Differentiated market leader in highly fragmented industry We are one of the largest LBM (Lumber and Building Material) supplier of building products, prefabricated components and value-added services, primarily for new residential construction and repair and remodeling, in t
Slide 5: Geographic diversity and balanced end market exposure
Geographic diversity and balanced end market exposure We have created a diversified company with enhanced scale and an improved geographic footprint, which allows for better customer reach and less exposure to any one market Presence in 75 of top 100 MSAs and in 40 states Our national scale fa
Slide 6: Upside remains in US housing cycle
Upside remains in US housing cycle U.S. housing starts(1) Professional home improvement products spending(2) 2.5 $120 Historic Averages: Total 1.4M (Single Family = 1.0M) Previous recessionary $100 2.0 troughs $80 ($ in billions) 1.5 (Millions) $60 1.0 $40 0.5 $20 0.0 $0 1968 1978 1988 1998 2008 201
Slide 7: 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 for of our high margin value-added products 2016 sales by product category Lumber & Sheet Goods Manufactured product Windows, doors & millwork Other Lumber & 11% Lumber Sheet Goods 34% Siding, Metal & Concrete 10% Gypsum,
Slide 8: ProBuild integration largely complete; enhanced focus on growth opportunities
ProBuild integration largely complete; enhanced focus on growth opportunities We have implemented actions that are designed to achieve $100 million of the annual run rate cost savings associated with the ProBuild Acquisition Our run rate synergy savings have reached $100M, within the range we pr
Slide 9: 2017 priorities reinvigorate our focus on growth
2017 priorities reinvigorate our focus on growth Leverage our geographic reach, vendor and customer relationships, and leading Accelerating Capture of Market scale to grow faster than the market Share We will continue to expand our salesforce Expansion of Value-Added Significant opportunities
Slide 10: Pro Forma Adjusted Financial Overview
Pro Forma Adjusted Financial Overview 9
Slide 11: Q4 2016 Adjusted results
Q4 2016 Adjusted results Pro Forma Net Revenue Bridge Sales per day grew 10.1% over prior year ($ in millions) Sales per day+13.2% in new residential construction +3.7% sales per day growth in the repair and remodel end market Commodity price inflation benefited sales by 4.4% Gross margins
Slide 12: 2016 Financial Highlights
2016 Financial Highlights Sales grew 5.5% over prior year, on a pro forma adjusted basis excluding closed locations Adjusted net income improved $97M, or $0.86 per share, over Pro Forma Adjusted 2015 Adjusted EBITDA increased 21.8% over prior year Adjusted Net Leverage ratio for year end 201
Slide 13: Free cash flow and deleveraging priorities
Free cash flow and deleveraging priorities The following financial attributes… We believe will enable Builders FirstSource to… Strong projected free cash flow generation Generate free cash flow of $145-155M in 2017 Low capital intensive business with ongoing Reduce debt expenditures at 1 - 1.5% of s
Slide 14: Liquidity and debt profile
Liquidity and debt profile Total liquidity at December 31, 2016 was $681.6M Maturity profile has been extended, with the first tranche of debt coming due in August 2023 • Long term debt weighted average maturity (excluding lease financing obligations) extended to over 7 years • Maturity profile
Slide 15: Appendix - Financial Schedules
Appendix - Financial Schedules 14
Slide 16: Adjusted EBITDA Reconciliation by Quarter and Year
Adjusted EBITDA Reconciliation by Quarter and Year Quarter 1 Quarter 2 Quarter 3 Quarter 4 Fiscal Quarter 1 Quarter 2 Quarter 3 Quarter 4 Fiscal 2015 2015 2015 2015 2015 2016 2016 2016 2016 2016 Financial Data Pro forma net sales $ 1,284.1 $ 1,627.8 $ 1,699.0 $ 1,455.9 $ 6,066.8 $ 1,397.1 $ 1,677.3
Slide 17: Adjusted EBITDA Reconciliation Q4 and Fiscal 2016
Adjusted EBITDA Reconciliation Q4 and Fiscal 2016 Three months ended Twelve months ended December 31, December 31, 2016 2015 (1) 2016 2015 (1) (in $ millions) Reported GAAP Net Income (Loss) $ 6.4 $ (10.6) $ 144.3 $ (22.8) ProBuild Net Income (Loss) - - - 32.0 Pro forma interest adjustment - - - (41
Slide 18: GAAP Financial Schedules – Income Statement
GAAP Financial Schedules – Income Statement The Company acquired ProBuild on July 31, 2015. Accordingly, ProBuild’s financial results are not included in the Generally Accepted Accounting Principles (“GAAP”) results for any periods prior to the Closing Date Years Ended December 31, 2016 2015 2014
Slide 19: GAAP Financial Schedules – Balance Sheet
GAAP Financial Schedules – Balance Sheet December 31, 2016 2015 (In thousands, except per share amounts) ASSETS Current assets: Cash and cash equivalents $ 14,449 $ 65,063 Accounts receivable, less allowances of $11,571 and $8,049 at December 31, 2016 and 2015, respectively 569,208 528,544 Other rec
Slide 20: GAAP Financial Schedules – Cash Flow
GAAP Financial Schedules – Cash Flow Years Ended December 31, 2016 2015 2014 (In thousands) Cash flows from operating activities: Net income (loss) $ 144,341 $ (22,831) $ 18,150 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 109
Slide 21: p SBuilders
p SBuilders 4FirstSource