Net sales in the fiscal fourth quarter increased 83.1% on a year-over-year (YOY) basis to $4.6 billion at Builders FirstSource (BFS). The strong YOY growth in net sales was driven by the company’s merger with BMC Holdings, double-digit organic growth, and commodity inflation, according to the dealer. For the full fiscal year 2021, net sales increased 132.4% compared to the previous year to $19.9 billion.
Core organic sales in the fourth quarter increased by 11.7% compared to the fourth quarter of 2020, while commodity price inflation contributed 5.3% to net sales. Acquisitions, excluding the BMC mega-merger, contributed net sales growth of 6.7% in the fourth quarter, according to BFS. The dealer reported core organic sales in value-added products grew by an estimated 28.3% compared with the combined pro forma prior year period. During the fourth quarter, BFS reported healthy growth across the single-family, remodel and repair, and multifamily end markets.
For the full fiscal year, commodity inflation contributed 30.2% to net sales growth, while core organic sales increased by 20.6%. In 2021, core organic sales in value-added products grew by an estimated 29.8%, led by 42.5% growth in the dealer’s manufactured products category compared with the combined pro forma prior year period.
“We achieved another quarter of double-digit core organic growth to conclude an outstanding year of above market performance and record results in 2021,” BFS CEO Dave Flitman said in a prepared statement. “On a pro forma basis in 2021, we delivered core organic growth of 21% and produced record sales of nearly $20 billion to deliver over $3 billion of adjusted EBITDA and a record adjusted EBITDA margin of 15.4%. Our business is strong and we grew sales by more than 25% and adjusted EBITDA by more than 60%. I am extremely proud of our team members who achieved these outstanding results despite the many supply chain challenges impacting our industry.”
BFS reported gross profit of $1.5 billion in the fiscal fourth quarter, an increase of $511.3 million compared with the combined pro forma prior year period. The company’s gross margin increased 610 basis points to 32.1%, primarily driven by pricing discipline and effective and timely sourcing. For the full fiscal year, gross profit increased $2.6 billion compared with the combined pro forma prior year period to $5.9 billion. Gross margin for the full fiscal year increased 360 basis points to 29.4%.
Net income in the fiscal fourth quarter was $442.5 million, compared to combined pro forma net income of $200.7 million in the same period a year ago. Adjusted EBITDA in the fourth quarter increased 110.0% to $793.4 million while adjusted EBITDA margin improved to a record 17.1% after a 700 basis point increase on a YOY pro forma basis.
For the full fiscal year, net income was $1.7 billion, compared to a combined pro forma of $484.8 million in the same period a year ago. Adjusted EBITDA increased 185.5% to $3.1 billion, while adjusted EBITDA margin for the full fiscal year improved 15.4%.
“Looking at our progress, we are clearly leveraging the strength of our industry-leading platform, national network, operating model, and robust demand environment to deliver exceptional growth, profitability, and free cash flow,” Flitman said. “In addition, we continued to execute on our strategic priorities to invest both organically and through M&A, while returning capital to our shareholders through share repurchases. With a thoughtful and disciplined approach to deploying our capital, we are transforming the homebuilding industry through our investments in digital, expanding valued-added offerings for our customers, and making strategic investments that bolster and extend our industry-leading position.”
Since closing the merger with BMC on January 1, 2021, BFS exited the 2021 calendar year realizing expected cost synergies of $160 million through 2022. The dealer delivered $32 million in cost synergies in the fourth quarter and $108 million for the full year. BFS said it forecasts it will deliver approximately $100 million in productivity savings in 2022.
