The continued strength of the residential market contributed to a strong quarter for Gypsum Management & Supply (GMS). In the company’s first quarter for fiscal 2022, the three-month period ending on July 31, 2021, net sales increased 29.8% on a year-over-year (YOY) basis to $1.04 billion compared to the COVID-19 impacted fiscal first quarter in 2021.
In addition to the residential market strength, inflationary pricing, solid demand for complementary products, and acquisitions contributed to positive sales growth in the quarter for GMS. The distributor reported organic sales increased 23.2% YOY. Wallboard sales increased 18.9% on a YOY basis to $390.1 million, ceiling sales increased 20.4% YOY to $138.1 million, steel framing sales increased 77.6% on a YOY basis to $196.3 million, and complementary product sales increased 27.4% YOY to $317.6 million.
“GMS’s outstanding performance continued, as we delivered another quarter of record net sales, net income, and adjusted EBITDA, including recording more than a billion dollars in quarterly net sales for the first time in the company’s history,” John Turner, president and CEO of GMS, said in a prepared statement. “We are continuing to benefit from a robust residential market, an inflationary environment, and strong demand for our complementary products, while our team’s solid execution of our strategic growth priorities helped offset continuing softness in many commercial markets.”
GMS reported net income more than doubled to $61.2 million in the fiscal first quarter. The distributor’s adjusted EBITDA increased 54.2% to $128.1 million compared to the prior year period while adjusted EBITDA margin improved 200 basis points YOY to 12.3%.
The distributor reported gross profit increased 28.9% on a YOY basis to $335.8 million while gross margin declined 30 basis points to 32.2%. GMS attributed to decrease in gross margin to price-cost dynamics related to the timing of the implementation of price actions, particularly in wallboard.
During the fiscal first quarter of 2022, GMS completed two acquisitions: the previously announced acquisition of Westside Building Material and the purchase of Architectural Coatings Distributors. The Westside purchase enhances GMS’s presence in several major California metro areas and provided entry into the Las Vegas market, while the Architectural Coatings acquisition added an EIFS/stucco product line in the Cleveland, Ohio market. In addition to the acquisitions, GMS also opened five greenfields during the fiscal first quarter.
“As we look ahead to the remainder of fiscal 2022 and beyond, we expect to continue both greenfields and acquisitions to enter underserved markets and boost our product offerings,” Turner said. “I am confident that our focus on our strategic priorities and our team’s continued drive to execute will position us to generate value for our shareholders well into the future.”
Tucker, Ga.-based GMS operates a network of more than 280 distribution centers across the United States and Canada, offering wallboard, suspended ceiling systems, and complementary construction products.
