TopBuild Reports Second Quarter Results

Both segments drive growth, resulting in second quarter sales of $1.37 billion

Delivered gross margin of 31% and adjusted EBITDA margin of 20.3%

Revises 2024 guidance to $5.3 to $5.5 billion in revenue and $1.055 to $1.125 billion in adjusted EBITDA

DAYTONA BEACH, Fla., Aug. 06, 2024 (GLOBE NEWSWIRE) — TopBuild Corp. (NYSE:BLD) a leading installer and specialty distributor of insulation and building material products to the construction industry in the United States and Canada today reported results for the second quarter ended June 30, 2024.

“We’re pleased with our solid results in the second quarter, as our teams continued to focus on growth and profitability across the business. We grew sales 3.7% to $1.37 billion and delivered adjusted EBITDA of $277.7 million and adjusted EBITDA margin of 20.3%. Excluding the benefit from higher-than-normal multi-family and commercial margins in the second and third quarter of 2023,1we delivered our highest level of sales and profitability in our history,” said Robert Buck, President and Chief Executive Officer.

“Both segments delivered sales growth in the second quarter, however volume was less than anticipated due to higher interest rates, project delays and supply constraints that continue to impact results across some residential and commercial end markets. Our residential single-family sales continued to improve, and our backlog continues to support our multi-family sales. Commercial and industrial backlogs and bidding activity remain robust.

“The long-term fundamentals for our business are strong, supported by the undersupply of housing in the United States, increasing household formations, the potential for moderating interest rates, and strengthening demand for greater energy efficiency. We expect to continue driving profitable growth and strong free cash flows for TopBuild to reinvest or return to shareholders.

“Year to date, we have completed 6 acquisitions, and our M&A pipeline is very healthy. We are also returning capital to shareholders, and as of June 30, we repurchased approximately 1.25 million shares totaling $505.2 million, underscoring management and our Board’s continued confidence in our future growth and capital allocation approach,” concluded Mr. Buck.

The Company noted that its results for the second quarter of 2023 included an estimated $10 million margin benefit related to certain multi-family/commercial business. In the third quarter of 2023, a similar benefit is estimated to be $15 million.

Financial Highlights

(comparisons are to the periods ended June 30, 2023)

Three Months Ended June 30          
$ in thousands Reported   Adjusted
    2024     2023       2024     2023  
Sales $ 1,365,612   $ 1,317,262     $ 1,365,612   $ 1,317,262  
Gross Profit   423,922     421,800       423,922     421,800  
Gross Margin   31.0 %   32.0 %     31.0 %   32.0 %
SG&A   213,530     184,697       185,893     182,597  
SG&A as % of revenue   15.6 %   14.0 %     13.6 %   13.9 %
Operating Profit   210,392     237,103       238,029     239,203  
Operating Margin   15.4 %   18.0 %     17.4 %   18.2 %
Net Income   150,723     164,400       170,800     166,685  
Net Income per diluted share $ 4.78   $ 5.18     $ 5.42   $ 5.25  
EBITDA     $ 277,694   $ 275,505  
EBITDA Margin       20.3 %   20.9 %
           
           
           
Six Months Ended June 30          
$ in thousands Reported   Adjusted
    2024     2023       2024     2023  
Sales $ 2,644,329   $ 2,582,500     $ 2,644,329   $ 2,582,500  
Gross Profit   811,072     792,015       811,072     792,015  
Gross Margin   30.7 %   30.7 %     30.7 %   30.7 %
SG&A   386,172     355,481       358,609     349,723  
SG&A as % of revenue   14.6 %   13.8 %     13.6 %   13.5 %
Operating Profit   424,900     436,534       452,463     442,292  
Operating Margin   16.1 %   16.9 %     17.1 %   17.1 %
Net Income   303,104     300,270       323,922     305,045  
Net Income per diluted share $ 9.56   $ 9.47     $ 10.22   $ 9.62  
EBITDA     $ 531,513   $ 513,830  
EBITDA Margin       20.1 %   19.9 %

Sales Drivers

(comparisons are to the periods ended June 30, 2023)

  Three Months Ended June 30, 2024
  Installation Specialty Distribution TopBuild, net of elims
Sales (in millions) $ 851   $ 593   $ 1,366  
Sales Drivers      
Volume    1.0 %   0.6 %   0.0 %
 Price   1.3 %   1.3 %   1.3 %
M&A    3.8 %   1.3 %   2.9 %
 Dispositions   -0.9 %     -0.6 %
Total Sales Change   5.2 %   3.2 %   3.7 %
       
       
  Six Months Ended June 30, 2024
  Installation Specialty Distribution TopBuild, net of elims
Sales (in millions) $ 1,650   $ 1,139   $ 2,644  
Sales Drivers      
Volume    0.7 %   -1.8 %   -1.0 %
 Price   1.2 %   1.4 %   1.3 %
M&A    3.7 %   0.9 %   2.6 %
 Dispositions   -0.9 %     -0.5 %
Total Sales Change   4.7 %   0.5 %   2.4 %
       

Segment Profitability
(comparisons are to the periods ended June 30, 2023)

  Three Months Ended June 30, 2024   Six Months Ended June 30, 2024
$ in thousands Installation Specialty Distribution   Installation Specialty Distribution
Operating Profit $ 170,718   $ 89,373     $ 327,475   $ 166,951  
Change   -0.9 %   3.9 %     2.6 %   4.8 %
Operating Margin   20.1 %   15.1 %     19.9 %   14.7 %
Adj. Operating Profit $ 171,006   $ 89,383     $ 327,808   $ 166,211  
Change   -0.9 %   4.0 %     2.5 %   4.1 %
Adj. Operating Margin   20.1 %   15.1 %     19.9 %   14.6 %
Adj. EBITDA $ 190,036   $ 104,810     $ 365,435   $ 196,907  
Change   0.2 %   3.7 %     3.3 %   3.9 %
Adj. EBITDA Margin   22.3 %   17.7 %     22.2 %   17.3 %
           

Capital Allocation

2024 Acquisitions
Year to date, the Company has completed the acquisition of 6 insulation companies which are expected to generate approximately $107 million in annual revenue. They are listed in the chart below.

 

  Annual Revenue
Company ($ millions)   Month Closed  
Brabble Insulation (I) $ 5.2     February  
Morris Black & Sons (I)   3.8     March  
Pest Control Insulation (D)   25.4     March  
Green Space Insulation (I)   6.0     April  
Insulation Works (I)   28.0     May  
Texas Insulation (I)   38.9     May  
Total $ 107.3        
I = Installation, D = Specialty Distribution      

Share Repurchases
During the quarter, TopBuild repurchased approximately 1.25 million shares totaling $505.2 million (average price of $405.43 per share). $649.2 million remained under the current authorization.

2024 Outlook2
The Company revised its full year 2024 guidance as indicated below. The sales guidance assumes mid-single digit residential growth and low single digit commercial/industrial growth for the year. The Company noted that the revision largely reflects timing of demand, rather than any underlying changes in the business.

$ in millions    
2024 Outlook Low High
Sales $ 5,300   $ 5,500  
Adjusted EBITDA* $ 1,055   $ 1,125  
     
* See table for Adjusted EBITDA reconciliation.

2 This outlook reflects management’s current view of present and future market conditions and is based on assumptions such as housing starts, general and administrative expenses, and interest rates. These targets do not include any effects related to potential acquisitions or divestitures that may occur after the date of this press release. A reconciliation of non-GAAP targets to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, the costs and expenses that may be incurred in the future and therefore, cannot be reasonably predicted. The effect of these excluded items may be significant. Factors that could cause actual long-term results to differ materially from TopBuild’s current expectations are discussed below and are also detailed in the Company’s most recent Annual Report on Form 10-K and subsequent SEC reports.

Conference Call

A conference call to discuss second quarter 2024 financial results is scheduled for today, Tuesday, August 6, at 9:00 a.m. Eastern Time. The call may be accessed by dialing (877) 407-9037. A simultaneous webcast of the call, along with management’s formal remarks and a presentation, will be available on the Company’s website at www.topbuild.com shortly before the call begins.

About TopBuild

TopBuild Corp., headquartered in Daytona Beach, Florida, is a leading installer and specialty distributor of insulation and related building material products to the construction industry in the United States and Canada. We provide insulation installation services nationwide through our Installation segment which has approximately 250 branches located across the United States. We distribute building and mechanical insulation, insulation accessories and other building product materials for the residential, commercial, and industrial end markets through our Specialty Distribution business. Our Specialty Distribution network encompasses approximately 170 branches. To learn more about TopBuild please visit our website at www.topbuild.com.

Use of Non-GAAP Financial Measures

Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the “adjusted” financial measures presented above, and figures presented on a “same branch basis” are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. Additional information may be found in the Company’s filings with the Securities and Exchange Commission which are available on TopBuild’s website under “SEC Filings” at www.topbuild.com.

Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, our expected financial and operational results, the related assumptions underlying our expected results, and our plan to repurchase our common stock under stock repurchase transactions. These forward-looking statements can be identified by words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” “may,” “project,” “estimate” or “intend,” the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. Our forward-looking statements contained herein speak only as of the date of this press release. Factors or events that we cannot predict, including those described in the risk factors contained in our filings with the Securities and Exchange Commission, may cause our actual results to differ from those expressed in forward-looking statements. Although TopBuild believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved and it undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

(tables follow)

TopBuild Corp.                      
Condensed Consolidated Statements of Operations (Unaudited)                  
(in thousands, except share and per common share amounts)                  
                       
  Three Months Ended June 30,   Six Months Ended June 30,
    2024       2023       2024       2023  
Net sales $ 1,365,612     $ 1,317,262     $ 2,644,329     $ 2,582,500  
Cost of sales   941,690       895,462       1,833,257       1,790,485  
Gross profit   423,922       421,800       811,072       792,015  
                       
Selling, general, and administrative expense   213,530       184,697       386,172       355,481  
Operating profit   210,392       237,103       424,900       436,534  
                       
Other income (expense), net:                      
Interest expense   (18,568 )     (18,558 )     (37,363 )     (36,597 )
Other, net   11,350       4,605       22,632       6,528  
Other expense, net   (7,218 )     (13,953 )     (14,731 )     (30,069 )
Income before income taxes   203,174       223,150       410,169       406,465  
                       
Income tax expense   (52,451 )     (58,750 )     (107,065 )     (106,195 )
Net income $ 150,723     $ 164,400     $ 303,104     $ 300,270  
                       
Net income per common share:                      
Basic $ 4.81     $ 5.20     $ 9.63     $ 9.51  
Diluted $ 4.78     $ 5.18     $ 9.56     $ 9.47  
                       
Weighted average shares outstanding:                      
Basic   31,324,833       31,599,744       31,483,144       31,575,337  
Diluted   31,524,063       31,731,807       31,693,524       31,722,660  
                       
TopBuild Corp.                          
Condensed Consolidated Statements of Comprehensive Income (Unaudited)                  
(in thousands)                          
                           
  Three Months Ended June 30,   Six Months Ended June 30,
    2024       2023       2024       2023  
Net income $ 150,723     $ 164,400     $ 303,104     $ 300,270  
Other comprehensive (loss) income:                          
Foreign currency translation adjustment   (1,836 )     4,283       (5,928 )     6,037  
Comprehensive income $ 148,887     $ 168,683     $ 297,176     $ 306,307  
                           
TopBuild Corp.              
Condensed Consolidated Balance Sheets and Other Financial Data (Unaudited)              
(dollars in thousands)              
  As of
  June 30, 2024   December 31, 2023
ASSETS              
Current assets:              
Cash and cash equivalents $ 463,221     $ 848,565  
Receivables, net of an allowance for credit losses of $22,718 at June 30, 2024, and $23,948 at December 31, 2023   859,725       799,009  
Inventories   393,810       364,731  
Prepaid expenses and other current assets   43,550       36,939  
Total current assets   1,760,306       2,049,244  
               
Right of use assets   191,048       204,629  
Property and equipment, net   267,523       264,487  
Goodwill   2,090,788       2,042,568  
Other intangible assets, net   583,141       591,058  
Other assets   10,187       10,865  
Total assets $ 4,902,993     $ 5,162,851  
               
LIABILITIES              
Current liabilities:              
Accounts payable $ 461,139     $ 469,585  
Current portion of long-term debt   45,665       47,039  
Accrued liabilities   176,753       187,217  
Short-term operating lease liabilities   66,953       65,780  
Short-term finance lease liabilities   1,739       1,917  
Total current liabilities   752,249       771,538  
               
Long-term debt   1,351,969       1,373,028  
Deferred tax liabilities, net   243,790       243,930  
Long-term portion of insurance reserves   60,402       58,783  
Long-term operating lease liabilities   132,529       146,213  
Long-term finance lease liabilities   3,318       4,150  
Other liabilities   1,422       1,554  
Total liabilities   2,545,679       2,599,196  
               
EQUITY   2,357,314       2,563,655  
Total liabilities and equity $ 4,902,993     $ 5,162,851  
               
  As of June 30,
  2024   2023
Other Financial Data              
Receivable days   51       50  
Inventory days   39       39  
Accounts payable days   57       64  
Receivables, net plus inventories less accounts payable $ 792,396     $ 774,111  
Receivables, net plus inventories less accounts payable as a percent of sales (TTM) †   14.8 %     14.9 %
               
† Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches              
TopBuild Corp.          
Condensed Consolidated Statement of Cash Flows (Unaudited)          
(in thousands)          
           
  Six Months Ended June 30,
    2024       2023  
Cash Flows Provided by (Used in) Operating Activities:        
Net income $ 303,104     $ 300,270  
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   69,291       64,652  
Share-based compensation   9,759       6,886  
(Gain)/loss on sale of assets   (131 )     621  
Amortization of debt issuance costs   1,440       1,440  
Provision for bad debt expense   9,874       4,031  
Provision for inventory obsolescence   4,892       3,290  
Change in certain assets and liabilities:          
Receivables, net   (58,411 )     (37,247 )
Inventories   (30,758 )     54,623  
Prepaid expenses and other current assets   (6,595 )     8,897  
Accounts payable   (17,480 )     (8,806 )
Accrued liabilities   (13,348 )     (13,872 )
Other, net   (2,509 )     1,012  
Net cash provided by operating activities   269,128       385,797  
           
Cash Flows Provided by (Used in) Investing Activities:          
Purchases of property and equipment   (35,974 )     (30,672 )
Acquisition of businesses, net of cash acquired   (88,123 )     (45,948 )
Proceeds from sale of assets   2,150       782  
Net cash used in investing activities   (121,947 )     (75,838 )
           
Cash Flows Provided by (Used in) Financing Activities:          
Repayment of long-term debt   (23,873 )     (18,829 )
Taxes withheld and paid on employees’ equity awards   (6,059 )     (6,350 )
Exercise of stock options   3,224       1,497  
Repurchase of shares of common stock   (505,241 )      
Payment of contingent consideration         (300 )
Net cash used in financing activities   (531,949 )     (23,982 )
Impact of exchange rate changes on cash   (576 )     281  
Net (decrease) increase in cash and cash equivalents   (385,344 )     286,258  
Cash and cash equivalents – Beginning of period   848,565       240,069  
Cash and cash equivalents – End of period $ 463,221     $ 526,327  
           
Supplemental disclosure of noncash activities:          
Leased assets obtained in exchange for new operating lease liabilities $ 20,180     $ 26,310  
Accruals for property and equipment   277       1,449  
Excise taxes capitalized to treasury stock   5,202        
TopBuild Corp.                                            
Segment Data (Unaudited)                                            
(dollars in thousands)                                            
                                             
  Three Months Ended June 30,           Six Months Ended June 30,        
    2024       2023     Change     2024       2023     Change
Installation                                            
Sales $ 850,983     $ 809,055       5.2 %   $ 1,649,726     $ 1,576,145       4.7 %
                                             
Operating profit, as reported $ 170,718     $ 172,278             $ 327,475     $ 319,176          
Operating margin, as reported   20.1 %     21.3 %             19.9 %     20.3 %        
                                             
Acquisition related costs   288       227               333       490          
Operating profit, as adjusted $ 171,006     $ 172,505             $ 327,808     $ 319,666          
Operating margin, as adjusted   20.1 %     21.3 %             19.9 %     20.3 %        
                                             
Share-based compensation   318       310               648       689          
Depreciation and amortization   18,712       16,791               36,979       33,284          
EBITDA, as adjusted $ 190,036     $ 189,606       0.2 %   $ 365,435     $ 353,639       3.3 %
EBITDA margin, as adjusted   22.3 %     23.4 %             22.2 %     22.4 %        
                                             
Specialty Distribution                                            
Sales $ 592,826     $ 574,488       3.2 %   $ 1,138,620     $ 1,132,862       0.5 %
                                             
Operating profit, as reported $ 89,373     $ 85,980             $ 166,951     $ 159,313          
Operating margin, as reported   15.1 %     15.0 %             14.7 %     14.1 %        
                                             
Rationalization charges                       (750 )              
Acquisition related costs   10                     10       340          
Operating profit, as adjusted $ 89,383     $ 85,980             $ 166,211     $ 159,653          
Operating margin, as adjusted   15.1 %     15.0 %             14.6 %     14.1 %        
                                             
Share-based compensation   380       316               813       554          
Depreciation and amortization   15,047       14,740               29,883       29,312          
EBITDA, as adjusted $ 104,810     $ 101,036       3.7 %   $ 196,907     $ 189,519       3.9 %
EBITDA margin, as adjusted   17.7 %     17.6 %             17.3 %     16.7 %        
                                             
TopBuild Corp.                                      
Adjusted EBITDA (Unaudited)                                      
(dollars in thousands)                                      
                                       
  Three Months Ended June 30,            Six Months Ended June 30,         
    2024       2023       Change        2024       2023       Change 
Total net sales                                      
Sales before eliminations $ 1,443,809     $ 1,383,543             $ 2,788,346     $ 2,709,007          
Intercompany eliminations   (78,197 )     (66,281 )             (144,017 )     (126,507 )        
Net sales after eliminations $ 1,365,612     $ 1,317,262       3.7 %   $ 2,644,329     $ 2,582,500       2.4 %
                                       
Operating profit, as reported – segments $ 260,091     $ 258,258             $ 494,426     $ 478,489          
General corporate expense, net   (36,859 )     (9,957 )             (45,926 )     (20,786 )        
Intercompany eliminations   (12,840 )     (11,198 )             (23,600 )     (21,169 )        
Operating profit, as reported $ 210,392     $ 237,103             $ 424,900     $ 436,534          
Operating margin, as reported   15.4  %     18.0  %             16.1  %     16.9  %        
                                       
Rationalization charges   258                     (492 )              
Acquisition related costs †   4,379       2,100               5,055       5,758          
Acquisition termination fee   23,000                     23,000                
Operating profit, as adjusted $ 238,029     $ 239,203             $ 452,463     $ 442,292          
Operating margin, as adjusted   17.4  %     18.2  %             17.1  %     17.1  %        
                                       
Share-based compensation   4,632       3,751               9,759       6,886          
Depreciation and amortization   35,033       32,551               69,291       64,652          
EBITDA, as adjusted $ 277,694     $ 275,505       0.8 %   $ 531,513     $ 513,830       3.4 %
EBITDA margin, as adjusted   20.3  %     20.9             20.1  %     19.9  %        
                                       
Sales change period over period   48,350                     61,829                
EBITDA, as adjusted, change period over period   2,189                     17,683                
Incremental EBITDA, as adjusted, as a percentage of change in sales   4.5  %                   28.6  %              
                                       
† Acquisition related costs include corporate level adjustments as well as segment operating adjustments                    
                                       
TopBuild Corp.                      
Same Branch and Acquisition Metrics (Unaudited)                      
(dollars in thousands)                      
                       
  Three Months Ended June 30,   Six Months Ended June 30,
    2024       2023       2024       2023  
Net sales                      
Same branch:                      
Installation $ 820,243     $ 802,086     $ 1,592,184     $ 1,562,737  
Specialty Distribution   585,181       574,488       1,128,626       1,132,862  
Eliminations   (78,197 )     (66,281 )     (144,017 )     (126,507 )
Total same branch $ 1,327,227     $ 1,310,293     $ 2,576,793     $ 2,569,092  
                       
Acquisitions (a):                      
Installation $ 30,740     $     $ 57,542     $  
Specialty Distribution   7,645             9,994        
Total acquisitions   38,385             67,536        
                       
Dispositions (b):                      
Installation $     $ 6,969     $     $ 13,408  
Total dispositions         6,969             13,408  
Total net sales $ 1,365,612     $ 1,317,262     $ 2,644,329     $ 2,582,500  
                       
EBITDA, as adjusted                      
Same branch $ 271,096     $ 274,113     $ 521,202     $ 511,305  
Acquisitions (a)   6,598             10,311        
Dispositions (b)         1,392             2,525  
Total $ 277,694     $ 275,505     $ 531,513     $ 513,830  
                       
EBITDA, as adjusted, as a percentage of sales                      
Same branch (c)   20.4 %           20.2 %      
Acquisitions (d)   17.2 %           15.3 %      
Total (e)   20.3 %     20.9 %   20.1 %     19.9 %
                       
As Adjusted Incremental EBITDA, as a percentage of change in sales                      
Same branch (f)   NM             128.5        
Acquisitions (d)   17.2 %           15.3 %      
Total (g)   4.5 %           28.6 %      
                       
(a) Represents current year impact of acquisitions in their first twelve months
(b) Represents operating results in prior period previously classified as same branch
(c) Same branch metric, as adjusted, as a percentage of same branch sales
(d) Acquired metric, as adjusted, as a percentage of acquired sales
(e) Total EBITDA, as adjusted, as a percentage of total sales
(f) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales
(g) Change in total EBITDA, as adjusted, as a percentage of change in total sales
NM Not Meaningful
TopBuild Corp.                      
Non-GAAP Reconciliations (Unaudited)                      
(in thousands, except share and per common share amounts)                      
                       
  Three Months Ended June 30,   Six Months Ended June 30,
    2024       2023       2024       2023  
Gross Profit Reconciliation                      
                       
Net sales $ 1,365,612     $ 1,317,262     $ 2,644,329     $ 2,582,500  
                       
Gross profit, as reported $ 423,922     $ 421,800     $ 811,072     $ 792,015  
                       
Acquisition related costs                      
Gross profit, as adjusted $ 423,922     $ 421,800     $ 811,072     $ 792,015  
                       
Gross margin, as reported   31.0   % 32.0   % 30.7   % 30.7 %
Gross margin, as adjusted   31.0   % 32.0   % 30.7   % 30.7 %
                       
Selling, General and Administrative Expense Reconciliation                      
                       
Selling, general, and administrative expense, as reported $ 213,530     $ 184,697     $ 386,172     $ 355,481  
                       
Rationalization charges   258             (492 )      
Acquisition related costs   4,379       2,100       5,055       5,758  
Acquisition termination fee   23,000             23,000        
Selling, general, and administrative expense, as adjusted $ 185,893     $ 182,597     $ 358,609     $ 349,723  
                       
Operating Profit Reconciliation                      
                       
Operating profit, as reported $ 210,392     $ 237,103     $ 424,900     $ 436,534  
                       
Rationalization charges   258             (492 )      
Acquisition related costs   4,379       2,100       5,055       5,758  
Acquisition termination fee   23,000             23,000        
Operating profit, as adjusted $ 238,029     $ 239,203     $ 452,463     $ 442,292  
                       
Operating margin, as reported   15.4   % 18.0   % 16.1 %     16.9 %
Operating margin, as adjusted   17.4   % 18.2   % 17.1 %     17.1 %
                       
Income Per Common Share Reconciliation                      
                       
Income before income taxes, as reported $ 203,174     $ 223,150     $ 410,169     $ 406,465  
                       
Rationalization charges   258             (492 )      
Acquisition related costs   4,379       2,100       5,055       5,758  
Acquisition termination fee   23,000             23,000        
Income before income taxes, as adjusted   230,811       225,250       437,732       412,223  
                       
Tax rate at 26.0%   (60,011 )     (58,565 )     (113,810 )     (107,178 )
Income, as adjusted $ 170,800     $ 166,685     $ 323,922     $ 305,045  
                       
Income per common share, as adjusted $ 5.42     $ 5.25     $ 10.22     $ 9.62  
                       
Weighted average diluted common shares outstanding   31,524,063       31,731,807       31,693,524       31,722,660  
TopBuild Corp.                            
Reconciliation of Adjusted EBITDA to Net Income (Unaudited)                            
(in thousands)                            
                             
  Three Months Ended June 30,   Six Months Ended June 30,
    2024       2023       2024       2023  
Net income, as reported $ 150,723     $ 164,400     $ 303,104     $ 300,270  
Adjustments to arrive at EBITDA, as adjusted:                            
Interest expense and other, net   7,218       13,953       14,731       30,069  
Income tax expense   52,451       58,750       107,065       106,195  
Depreciation and amortization   35,033       32,551       69,291       64,652  
Share-based compensation   4,632       3,751       9,759       6,886  
Rationalization charges   258             (492 )      
Acquisition related costs   4,379       2,100       5,055       5,758  
Acquisition termination fee   23,000             23,000        
EBITDA, as adjusted $ 277,694     $ 275,505     $ 531,513     $ 513,830  
                             
TopBuild Corp.                                      
Acquisition Adjusted Net Sales (Unaudited)                                      
(in thousands)                                      
  2023   2024   Trailing Twelve Months Ended
  Q3   Q4   Q1   Q2   June 30, 2024
Net sales $ 1,326,120     $ 1,286,074     $ 1,278,717     $ 1,365,612     $ 5,256,523  
Acquisitions proforma adjustment †   33,549       28,367       24,075       10,603       96,594  
Net sales, acquisition adjusted $ 1,359,669     $ 1,314,441     $ 1,302,792     $ 1,376,215     $ 5,353,117  
                                       
† Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches                              
TopBuild Corp.              
2024 Estimated Adjusted EBITDA Range (Unaudited)              
(in millions)              
               
  Twelve Months Ending December 31, 2024  
    Low       High  
Estimated net income, as reported $ 603.0     $ 663.0  
Adjustments to arrive at estimated EBITDA, as adjusted:              
Interest expense and other, net   48.0       45.0  
Income tax expense   212.0       230.0  
Depreciation and amortization   144.0       141.0  
Share-based compensation   19.0       18.0  
Acquisition related costs & rationalization charges   29.0       28.0  
Estimated EBITDA, as adjusted $ 1,055.0     $ 1,125.0  
               


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