Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide more details on the sluggish start to the year and how you plan to achieve healthy growth for the full year? A: Julian Francis, CEO, explained that January was challenging due to harsh weather, but recent improvements in demand are promising. The company expects first-quarter challenges but anticipates demand will increase as the year progresses. CFO Prith Gandhi added that for the full year, they expect mid-single-digit sales growth, driven by acquisitions, price carryover, and above-market growth initiatives.
Q: How many new greenfield locations are planned for 2025, and does the guidance include any price increases? A: Julian Francis stated that Beacon plans to open 15 to 20 new greenfield locations, adjusting based on market conditions. The guidance includes a residential price increase announced for April, which is factored into their price/cost neutral outlook for the year.
Q: What are the expectations for SG&A expenses in 2025, and what needs to happen to reach the 17% target? A: Julian Francis noted that digesting recent acquisitions and greenfield investments is necessary to reach the 17% SG&A target. Prith Gandhi added that they expect about $60 million in additional expenses from acquisitions and greenfields but anticipate leverage within the existing business through productivity improvements.
Q: Can you elaborate on the non-residential demand trends, particularly between new construction and repair and replace (R&R)? A: Julian Francis explained that the market is shifting from new construction to R&R due to past supply chain disruptions. The Architectural Billing Index indicates contraction in new construction, while R&R remains steady. Prith Gandhi highlighted Beacon's focus on gaining market share in commercial efforts, targeting growth markets.
Q: What are the expectations for residential pricing, and how does it align with the guidance? A: Prith Gandhi mentioned that the guidance assumes similar realization of the April price increase as in previous years, with a small basis point inventory profit. Julian Francis added that they expect a 1% incremental ASP for the full year, with the April increase contributing to this, while maintaining a price/cost neutral stance.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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