Beacon reported record sales, income, and profitability in the company’s fiscal second quarter.
During the second quarter, net sales increased 26.0% year-over-year (YOY) to $2.36 billion, a quarterly record from continuing operations. Beacon said sales increased across all three lines of business compared to the prior-year period, driven by the successful implementation of price increases. Higher demand in residential roofing and complementary products also contributed to the growth. Weighted-average selling price increased approximately 24-25% in the second quarter and estimated volumes increased approximately 0-1%.
Residential roofing product sales increased 21.9% YOY in the second quarter, non-residential roofing product sales increased 40.3% YOY, and complementary product sales increased 18.7% YOY.
“Beacon’s second quarter results are outstanding, with record setting top-line and bottom-line performance,” Beacon president and CEO Julian Francis said in a prepared statement. “Our team’s commitment to best-in-class service combined with solid end market demand and margin enhancing initiatives delivered the 10th straight quarter of year-over-year increases in adjusted EBITDA. In a challenging inflationary environment, we achieved the highest profits and margin in our history.”
Beacon’s gross margin in the fiscal second quarter was 27.6%, level with the second quarter of 2021, reflecting pricing execution that drove price-cost improvement, offset by a higher non-residential product sales mix. The company’s increase in operating expense and adjusted operating expense in 2022 was due to increases in payroll and benefit costs, selling costs and general and administrative expenses, according to the company.
During the second quarter, net income was $174.5 million, compared to $79.8 million in the second quarter of 2021. Adjusted EBITDA was $307.7 million in the second quarter, compared to $229.5 million in the prior year. Beacon said improvements in second quarter results were largely driven by higher net sales and favorable operating leverage.
“We made strategic investments in key markets, expanding both our branch footprint and our delivery capacity towards achieving our Ambition 2025 growth targets,” Francis said. “Looking forward, the fundamentals of residential and commercial re-roofing demand remain supportive. And while we have yet to be meaningfully impacted by higher interest rates, the Beacon Team has demonstrated agility in responding to changing market conditions and will continue to take advantage of any market changes.”
Herndon, Va.-based Beacon distributes roofing materials and complementary building products. The company operates over 400 branches throughout all 50 U.S. states and six Canadian provinces.
