IBP Q1 profits rise as acquisitions mount
Installed Building Products (IBP) reported first quarter 2021 revenue increased 10% to $437.1 million from revenue of $397.3 million in the first quarter 2020.
The Columbus, Ohio-based building products installer also posted a net income of $17.3 million, rising 8.1% from a net income of $16 million for the same period a year ago.
During the quarter, IBP continued its strategy of acquiring installers of insulation and complementary building products. To date in 2021, IBP had completed three acquisitions representing about $65 million of annual revenues.
In the last 12 months, IBP has completed acquisitions with over $160 million of annual revenues.
For 2021, the company said that it is targeting approximately $100 million of acquired revenue, which IBP may exceed depending on the timing of acquisitions within its large and growing pipeline.
During the 2021 first quarter, IBP acquired I.W. International Insulation, Inc. doing business as Intermountain West Insulation, a Washington-based provider of insulation installation services to residential customers throughout Washington, Oregon, and Idaho, with annual revenue of approximately $34.4 million.
Since the first quarter ended, IBP has acquired:
- Alert Insulation, a Southern California-based provider of fiberglass insulation installation, fireproofing services, and acoustical ceiling system installation services to commercial customers, with annual revenue of approximately $21.0 million.
- Alpine Construction Services, LLC, a Colorado Springs, Colo.-based provider of fiberglass and spray foam insulation installation services to residential and multifamily customers, with annual revenue of approximately $9.4 million.
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The Bottom Line: IBP sales rise 10% to $437.1 million as the company reports a net income increase of 8.1%.
What the CEO said: “Throughout the first quarter, we successfully overcame operating challenges,” said Jeff Edwards, chairman and CEO of Installed Building Products. “The COVID-19 crisis continues to impact our large commercial business. Additionally, the historic February winter storms had a meaningful impact on our material suppliers’ supply chains and impacted our production and installation efficiencies.
Edwards said the company estimates that lost production, as a result of the winter storms, impacted first quarter revenue by $3 million to $3.5 million, and gross profit by $1 million to $1.5 million.
“We ended the first quarter with positive momentum as we experienced the highest monthly sales in our history in March, and positive momentum has continued in the month of April,” Edwards noted.
The CEO also pointed out that it might not be all smooth sailing for IBP's second quarter, despite strong demand.
“While the supply chain efficiencies appear to have steadily improved during March and April, relative to January and February, we expect constraints will continue over the remainder of the year for many of the materials and products used throughout our installation work," Edwards said. "Despite near-term supply challenges, demand and pricing remain strong, and we expect trends within our large commercial business will improve later this year."
Company info: Click here to read the full first quarter 2021 financial report from Installed Building Products.