Beacon losses widen in Q1
Non-hurricane activity impacts Beacon sales compared to a year ago.
Beacon Building Products reported first quarter 2020 net sales fell 2.7% $1.68 billion from first quarter 2109 sales of $1.72 billion.
The Herndon, Va.-based roofing and building products distributor said the sales decline was caused by a decrease in hurricane-related demand compared to the prior year.
Residential roofing product sales decreased 4.1%, non-residential roofing product sales increased 0.2%, and complementary product sales decreased 3.1% compared to the prior year.
The company also reported a net loss of $23.4 million for the quarter compared to a net loss of $0.9 million for the same period a year ago.
Beacon said that first quarter results were impacted by lower gross margins and debt refinancing expenses that were incurred to reduce future cash outflows. The impact was partially offset by slight increases in non-residential roofing product sales and lower operating expenses.
Last month the company announced that 450 of its one-step locations, which included 40 different banners, were rebranding to the Beacon Building Products, or simply Beacon, and dropping the Beacon Roofing Supply name. Beacon said the new name reflects the company’s array of residential and commercial building product offerings in addition to the services it offers.
Beacon operates more than 500 location in the United States and Canada.
The Bottom Line: Sales slip while losses widen to $23.4 million for Beacon.
What the CEO said: “Our first quarter delivered important progress toward our goals,” said Julian Francis, Beacon president and CEO. “Results were broadly in line with our expectations, highlighted by sequential gross margin improvement and another quarter of growth in our non-residential roofing product line.”
“As expected, our sales declined modestly, which we believe was in line with the market. On the balance sheet, we decreased total debt by more than $300 million over the comparative periods. As part of our strategic review, we recently announced the unification of our 40 exterior product names into a single brand: Beacon Building Products. Our new brand enables us to leverage our nationwide scale to better serve customers, enhances our investment in e-commerce, and furthers our goal of developing innovative service propositions. Overall, we remain well-positioned to deliver annual sales and Adjusted EBITDA growth for fiscal 2020.”
Company info: Beacon’s full first quarter 2020 results can be read here.
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