Topbuild Corp. · NYSE:BLD
Topbuild — Q2 2016 Earnings Presentation
18 slides from Topbuild's earnings presentation, 2016
Slide 1: Second Quarter 2016 Earnings Presentation
Second Quarter 2016 Earnings Presentation NYSE:BLD
Slide 2: Safe Harbor
Statements contained in this presentation that are not historical and reflect our views about Safe Harbor future periods and events, including our future performance, constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can b
Slide 3: Q2 Overview
Q2 Overview Second Quarter ($ in 000s) 2016 Sales $431,589 Y-O-Y Change 6.9% Gross Profit Margin 22.6% Y-O-Y Change 140 bps Adjusted Operating Profit Margin * 6.4% Y-O-Y Change 140 bps Adjusted Net Income per Share * $0.43 Y-O-Y Change 59.3% * See Slides 17 & 18 for adjusted EBITDA reconciliation an
Slide 4: Capital Allocation
Capital Allocation • $50M Share Repurchase Program o $4.96M purchased first six months o $32.34 per share average price • Accretive/Strategic Acquisitions o Installation and distribution targets Expand market penetration Focus on regions with outsized growth prospects o Commercial Installation
Slide 5: Quarter Review: Home-Building Environment
Quarter Review Home-Building Environment • Household formations increasing • Barriers to home ownership improving • Builders starting to focus on entry level homes • Labor shortage extending completions Anticipate Longer Recovery Cycle with Continued Growth in New Home Construction 5
Slide 6: Income Statement
Income Statement Second Quarter Second Quarter ($ in 000s) 2016 2015 Sales $431,589 $403,761 Y-O-Y Change 6.9% Adjusted Operating Profit * $27,437 $19,331 Y-O-Y Change 41.9% Adjusted Operating Margin * 6.4% 5.0% Y-O-Y Change 140 bps Adjusted EBITDA * $32,555 $23,276 Y-O-Y Change 39.9% * See Slides 1
Slide 7: Second Quarter Highlights (Installation)
Second Quarter Second Quarter ($ in 000s) 2016 2015 Sales $288,042 $265,296 Y-O-Y Change 8.6% Adjusted Operating Profit * $22,863 $12,965 Y-O-Y Change 76.3% Adjusted Operating Margin * 7.9% 5.1% Y-O-Y Change 280 bps * See slide 18 for GAAP to non-GAAP reconciliation Highlights • Sales growth driven
Slide 8: Second Quarter Highlights (Distribution)
Second Quarter Second Quarter ($ in 000s) 2016 2015 Sales $164,257 $160,841 Y-O-Y Change 2.1% Adjusted Operating Profit * $13,547 $12,409 Y-O-Y Change 9.2% Adjusted Operating Margin * 8.2% 7.7% Y-O-Y Change 50 bps * See slide 18 for GAAP to non-GAAP reconciliation Highlights • Sales up 2.1% for impr
Slide 9: Adjusted EPS
Adjusted EPS Three Months Ended June 30, Six Months Ended June 30, ($ in 000s) 2016 2015 2016 2015 Income from continuing operations before income taxes, as reported $ 25,480 $ 8,330 $ 43,649 $ 4,030 Rationalization charges † 647 3,700 1,655 4,342 Legal adjustments, net — 1,020 — 1,370 Fixed asset d
Slide 10: Cash Flow/Working Capital/CAPEX
Cash Flow/Working Capital/CAPEX Six Months ended Six Months ended ($ in 000s) June 30, 2016 June 30, 2015 CAPEX $6,023 $7,111 Working Capital % to sales 8.4% 8.3% (using LTM sales) Operating Cash Flow $6,146 ($8,957) Cash Balance $102,090 $63,268 Highlights • CAPEX @ 0.7% of sales • Working capital
Slide 11: Driving Performance
Driving Performance • Builder sentiment optimistic 1,500 • TruTeam • Gaining market share 1,300 • Achieving strong operational improvements • Growing commercial revenue…light & heavy • Realizing improved pricing 1,100 • Service Partners • Growing volume 900 • Converting top line growth to bottom lin
Slide 12: Employer of Choice
4 lopBuild Employer of Choice Recruit FULL RANGE °BENEFITS S R SAFE ONG_FOCUS TY¥a. 12
Slide 13: Workforce Efficiency
Workforce Efficiency Proprietary Technology Solution Smartphone App Route Optimization Job Tracking Productivity Measured 13
Slide 14: Differentiated Business Model
Differentiated Business Model National footprint, Strong value local-brand appeal proposition and relationships with Consistency and reliability local contractors and valued by customers other customers Small Contractors, Lumber Yards, Retail 50,000+ Builders and General Contractors 14
Slide 15: Driving Value
Driving Value • Diverse business model 1,500 • Experienced, cycle tested leadership team • Successful track record 1,300 • Cultural fit • Focused Strategy 1,100 • Local empowerment • Simplification 900 • Operational excellence • Commercial expansion 700 • M&A initiative 500 15 15
Slide 16: Appendix
Appendix
Slide 17: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation TopBuild Corp. Segment Data (Unaudited) ($ in 000s) (dollars in thousands) Three Months Ended June 30, Six Months Ended June 30, 2016 2015 Change 2016 2015 Change Total Net sales after eliminations $ 431,589 $ 403,761 6.9 % $ 845,613 $ 762,221 10.9 % Operating profit,
Slide 18: Segment GAAP to Non-GAAP Reconciliation
Segment GAAP to Non-GAAP Reconciliation Three Months Ended June 30, Six Months Ended June 30, ($ in 000s) 2016 2015 Change 2016 2015 Change Installation Sales $ 288,042 $ 265,296 8.6 % $ 560,920 $ 498,659 12.5 % Operating profit, as reported $ 22,797 $ 7,067 $ 36,303 $ 6,035 Operating margin, as rep