GMS Reports Fourth Quarter and Fiscal Year 2024 Results

Rhea-AI Summary

GMS reported its Q4 and FY 2024 results, noting significant volume growth across all major product categories. Despite an 8.4% increase in net sales to $1.41 billion, net income fell 25.4% to $56.4 million due to Steel price deflation and higher tax and financing expenses. The company saw improved cash flow with free cash flow at $186.7 million. For the fiscal year, net sales rose 3.2% to $5.5 billion, while net income declined 17.1% to $276.1 million.

Key acquisitions in FY 2024, including Kamco Supply , expanded GMS's market presence. The company also repurchased 1.7 million shares worth $115.6 million. GMS expects a single-family market recovery in FY 2025, despite anticipating near-term challenges in Wallboard and Steel margins.

Positive

• Net sales increased by 8.4% in Q4 to $1.41 billion.
• Free cash flow remained strong at $186.7 million.
• Completed strategic acquisitions, including Kamco Supply
• Repurchased 1.7 million shares for $115.6 million, indicating shareholder value.
• Adjusted net income for Q4 was $78.1 million, despite challenges.

Negative

• Net income decreased by 25.4% to $56.4 million in Q4.
• Net income margin fell to 4.0% from 5.8%.
• Adjusted EBITDA margin declined to 10.4% from 11.8%.
• Increased SG&A expenses and lower Steel prices negatively impacted profitability.
• Net debt leverage increased to 1.7 times Adjusted EBITDA.

Insights

Financial Analyst

The recent earnings report from GMS Inc. presents a mixed picture for investors. While net sales saw an increase of 8.4% in the fourth quarter, net income demonstrated a significant decrease of 25.4% compared to the same period last year. This reduction in net income, down to $56.4 million from $75.6 million, can be attributed to increased tax and financing expenses. Additionally, the adjusted EBITDA margin fell from 11.8% to 10.4%, indicating tighter operational efficiency amidst rising costs and price deflation in steel.

Despite this, GMS Inc. displayed robust free cash flow generation at $186.7 million for the quarter, signaling strong liquidity health. The uptick in SG&A expenses by $35.7 million can partly be justified by recent acquisitions and openings of new yard locations. A notable strategic move was the acquisition of Kamco, expanding their footprint in NYC, which could offer long-term growth potential.

From an investor's perspective, while short-term margins and earnings show volatility, the company's strategic acquisitions and improved volume growth across major product categories suggest a potential for future upward correction. However, the near-term outlook might be challenging given the projected headwinds in wallboard and steel margins.

Market Research Analyst

GMS Inc.'s performance shows resilience despite sector-specific challenges. The company's focus on platform expansion through acquisitions, like Kamco and planned acquisition of Yvon, highlights its growth strategy. These acquisitions are designed to diversify their product offerings and geographically expand their market presence, which could buffer against market-specific downturns.

The reported volume growth across all four major product categories, including an impressive 21.7% increase in ceiling sales, demonstrates effective demand capture strategies amid fluctuating steel prices. However, the steel framing sales decline by 1.5% indicates that market volatility in raw material costs significantly impacts sales performance.

Investors should also note the decrease in organic net sales growth to 0.3% for the full fiscal year. This indicates that underlying growth, excluding acquisitions, remains relatively flat, pointing to a dependency on external growth methods.

Considering market dynamics, the company's strategic actions suggest a balanced approach aimed at navigating current market conditions while positioning for future growth. Yet, how these expansions translate into tangible financial performance remains to be seen, especially against a backdrop of steel price volatility.

Volume Growth Across All Four Major Product Categories Drove Record Levels of Full Year Net Sales and Strong Cash Flow

TUCKER, Ga.--(BUSINESS WIRE)-- GMS Inc. (NYSE: GMS), a leading North American specialty building products distributor, today reported financial results for the fourth quarter and fiscal year ended April 30, 2024.

Fourth Quarter Fiscal 2024 Highlights

(Comparisons are to the fourth quarter of fiscal 2023 unless otherwise noted)

• Net sales of $1,413.0 million increased 8.4% as volume growth across the major product lines was partially offset by Steel price deflation; organic net sales increased 4.0%. On a per day basis, net sales were up 6.7% and organic net sales increased 2.4%.
• Net income of $56.4 million, which was impacted by an increase of $5.9 million in additional tax and financing expenses, decreased 25.4% from $75.6 million. Net income per diluted share of $1.39, compared to $1.80. Net income margin was 4.0% compared to 5.8%; Adjusted net income of $78.1 million, or $1.93 per diluted share, compared to $88.6 million, or $2.11 per diluted share.
• Adjusted EBITDA of $146.6 million compared to $154.3 million; Adjusted EBITDA margin was 10.4% compared to 11.8%.
• Cash provided by operating activities of $204.2 million, compared to $204.8 million. Free cash flow of $186.7 million, compared with $185.4 million.
• Repurchased 174,555 shares of common stock for $16.0 million at an average cost per share of $91.86, compared to 496,737 shares of common stock for $27.9 million at an average cost per share of $56.15.
• Completed the acquisition of Kamco Supply Corporation (“Kamco”), meaningfully expanding the Company’s presence in New York City.
• Net debt leverage was 1.7 times Adjusted EBITDA as of the end of the fourth quarter of fiscal 2024 following the acquisition of Kamco, up from 1.5 times Adjusted EBITDA at the end of the third quarter of fiscal 2024 and 1.4 times at the end of the fourth quarter of fiscal 2023.

Full Year Fiscal 2024 Highlights

(Comparisons are to the full year of fiscal 2023, unless otherwise noted)

• Net sales of $5,501.9 million increased 3.2%; organic net sales increased 0.3%. On a per day basis, net sales were up 2.4% and organic net sales were down 0.5%.
• Net income of $276.1 million decreased 17.1% compared to net income of $333.0 million. Net income per diluted share of $6.75 decreased from $7.82. Net income margin was 5.0% compared to 6.2%; Adjusted net income of $337.3 million decreased 14.8% compared to $395.7 million. Adjusted net income per diluted share of $8.25 compared to $9.29.
• Adjusted EBITDA of $615.5 million decreased $50.2 million, or 7.5%; Adjusted EBITDA margin decreased 130 basis points to 11.2% from 12.5%.
• Cash provided by operating activities of $433.2 million, compared to $441.7 million. Free cash flow of $376.0 million, compared to $389.1 million.
• Repurchased 1.7 million shares of common stock for $115.6 million at an average cost per share of $67.93, compared to 2.3 million shares of common stock for $110.6 million at an average cost per share of $48.74.
• Successfully repriced the Company’s Term Loan B, resulting in an expected $3.7 million annualized interest expense savings as compared to the prior terms, or an expected annual $2.6 million benefit to net income.
• Demonstrating the continued execution of our strategic priorities, including platform expansion and Complementary Products growth, the Company completed three strategic acquisitions and opened five greenfield yard locations.

“We were pleased to deliver solid results for our fourth quarter and full year fiscal 2024, including record levels of net sales for the year,” said John C. Turner, Jr, President and Chief Executive Officer of GMS. “Versus prior year, despite lower single-family full year demand, we delivered volume growth across all our major product categories, which helped offset significant Steel price deflation that occurred at levels beyond our prior expectations. Solid levels of multi-family construction remained in backlog and commercial project activity continued through the end of our fiscal year. Plus, single-family year-over-year Wallboard volume growth for the fourth quarter turned positive for the first time since the fall of 2022. We believe this indicates the start of a mild recovery in an end market that, with considerable pent-up demand, remains poised for a more robust recovery with the expected eventual relief in mortgage rates.”

Turner continued, “As we move into fiscal 2025, we believe we are well prepared for what we expect to be continued changes in end market dynamics, as an improving single-family end market should help to offset declining multi-family, and likely commercial, demand as we move throughout the year. While we now anticipate some near-term headwinds, particularly in Wallboard and Steel margins, we expect to deliver improvement in our second quarter and solid results for the full fiscal year. With the typical 3-to-6 month lag in the realization of Wallboard price increases, we expect to see benefits from the implementation of the previously announced pricing actions later this summer. Also, we anticipate recent Steel manufacturer price increases to improve stabilization in pricing for that product category, which has softened further into our first fiscal quarter of 2025, pressuring both our top line and our profitability for the quarter. Leveraging the benefits of our scale, a wide breadth of product offerings and a balanced mix of end markets served, we expect to successfully navigate these shifts in end market demand and price movement during the year, all while continuing to focus on providing outstanding service and continuing the execution of our strategic priorities.”

Fourth Quarter Fiscal 2024 Results

(Comparisons are to the fourth quarter of fiscal 2023 unless otherwise noted)

Net sales for the fourth quarter of fiscal 2024 of $1.41 billion increased 8.4%, or 6.7% on a same day basis, primarily due to volume growth in each of the Company’s four primary product categories as commercial, single-family and multi-family each showed improvement in demand over the prior year quarter. This was the first quarter of positive year-over-year growth in single-family Wallboard volume since the fall of 2022. Offsetting the volume growth was significant year-over-year Steel price deflation, which reduced net sales by an estimated $29 million for the quarter. Organic net sales increased 4.0% in total or 2.4% on a same day basis.

Fourth quarter year-over-year sales by product category were as follows¹:

· Wallboard sales of $586.1 million increased 7.6% (up 6.0% on an organic basis).

· Ceilings sales of $188.9 million increased 21.7% (up 11.4% on an organic basis).

· Steel framing sales of $220.5 million decreased 1.5% (down 5.1% on an organic basis).

· Complementary product sales of $417.6 million increased 9.8% (up 3.5% on an organic basis).

________________________________________

¹ For more details on sales by product category, including per day organic sales change due to volume and/or price, mix and foreign exchange, please refer to the tables included at the back of this press release.

Gross profit of $451.2 million increased 6.3%, primarily due to the favorable impact of our recent acquisitions and the improved volumes we delivered during the quarter. Gross margin decreased 60 basis points to 31.9%, primarily due to the impact of continuing Steel price deflation. Gross margin also includes the negative impact of non-cash purchase accounting adjustments of $1.2 million, compared to $0.5 million.

Selling, general and administrative (“SG&A”) expenses were $315.5 million for the quarter, up from $279.8 million primarily related to our recent acquisitions and greenfield yard openings. Also contributing to the higher SG&A expenses were increased labor costs associated with our improved volume levels across all four of our major product categories, coupled with some inflationary pressures in wages and benefits.

SG&A expense as a percentage of net sales increased 80 basis points to 22.3% for the quarter compared to 21.5%. Reduced revenue from price deflation negatively impacted SG&A leverage by an estimated 55 basis points. Increased wages, benefits and other costs resulting mostly from improved volumes as well as some inflationary pressures in those costs, negatively impacted SG&A leverage by an estimated 15 basis points, and approximately 10 basis points of the remaining variance was primarily due to our recent acquisitions and greenfield yard openings. Adjusted SG&A expense as a percentage of net sales of 21.8% increased 90 basis points from 20.9%.

All in, inclusive of a 4.6% increase in interest expense and a 17.1% increase in income tax expense, net income decreased 25.4% to $56.4 million compared to net income of $75.6 million. Net income per diluted share of $1.39 decreased from $1.80 per diluted share. Adjusted net income was $78.1 million, or $1.93 per diluted share, compared to $88.6 million, or $2.11 per diluted share.

Adjusted EBITDA of $146.6 million compared to $154.3 million. Adjusted EBITDA margin of 10.4% decreased 140 basis points compared to 11.8%.

Balance Sheet, Liquidity and Cash Flow

As of April 30, 2024, the Company had cash on hand of $166.1 million, total debt of $1.3 billion and $655.9 million of available liquidity under its revolving credit facilities. Net debt leverage was 1.7 times Adjusted EBITDA as of the end of the quarter, up from 1.4 times Adjusted EBITDA at the end of the fourth quarter of fiscal 2023.

The Company generated cash from operating activities and free cash flow of $204.2 million and $186.7 million, respectively, for the quarter ended April 30, 2024. For the quarter ended April 30, 2023, the Company generated cash from operating activities and free cash flow of $204.8 million and $185.4 million, respectively.

During the quarter, the Company repurchased 174,555 shares of common stock for $16.0 million. As of April 30, 2024, the Company had $200.5 million of share repurchase authorization remaining.

Platform Expansion Activities

During the fourth quarter of fiscal 2024, the Company continued the execution of its platform expansion activities with the closing of its previously announced acquisition of Kamco Supply Corporation, representing a meaningful expansion for GMS into the New York City market.

Subsequent Event - Platform Expansion

On May 16, 2024, GMS announced that it had entered into an agreement to acquire Yvon Building Supply, Inc. and affiliated companies (“Yvon”) for an aggregate purchase price up to CAD$196.5 million. With seven locations across Ontario, Canada, Yvon provides Wallboard, insulation, Steel Framing, Ceilings and other Complementary Products and related services. This transaction is expected to close in July 2024. Also in May 2024, the Company acquired Howard & Sons Building Materials, Inc., a single location distributor of Wallboard, Steel framing and Complementary Products in Pomona, California.

Conference Call and Webcast

GMS will host a conference call and webcast to discuss its results for the fourth quarter and full year fiscal 2024, which ended on April 30, 2024, and other information related to its business at 8:30 a.m. Eastern Time on Thursday, June 20, 2024. Investors who wish to participate in the call should dial 877-407-3982 (domestic) or 201-493-6780 (international) at least 5 minutes prior to the start of the call. The live webcast will be available on the Investors section of the Company’s website at www.gms.com. There will be a slide presentation of the results available on that page of the website as well. Replays of the call will be available through July 20, 2024 and can be accessed at 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 13746741.

About GMS Inc.

Founded in 1971, GMS operates a network of more than 300 distribution centers with extensive product offerings of wallboard, ceilings, steel framing and complementary construction products. In addition, GMS operates over 100 tool sales, rental and service centers, providing a comprehensive selection of building products and solutions for its residential and commercial contractor customer base across the United States and Canada. The Company’s operating model combines the benefits of a national platform and strategy with a local go-to-market focus, enabling GMS to generate significant economies of scale while maintaining high levels of customer service.

Use of Non-GAAP Financial Measures

GMS reports its financial results in accordance with GAAP. However, it presents Adjusted net income, free cash flow, Adjusted SG&A, Adjusted EBITDA, and Adjusted EBITDA margin, which are not recognized financial measures under GAAP. GMS believes that Adjusted net income, free cash flow, Adjusted SG&A, Adjusted EBITDA, and Adjusted EBITDA margin assist investors and analysts in comparing its operating performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance. The Company’s management believes Adjusted net income, Adjusted SG&A, free cash flow, Adjusted EBITDA and Adjusted EBITDA margin are helpful in highlighting trends in its operating results, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which the Company operates and capital investments. In addition, the Company utilizes Adjusted EBITDA in certain calculations in its debt agreements.

You are encouraged to evaluate each adjustment and the reasons GMS considers it appropriate for supplemental analysis. In addition, in evaluating Adjusted net income, Adjusted SG&A and Adjusted EBITDA, you should be aware that in the future, the Company may incur expenses similar to the adjustments in the presentation of Adjusted net income, Adjusted SG&A and Adjusted EBITDA. The Company’s presentation of Adjusted net income, Adjusted SG&A, Adjusted SG&A margin, Adjusted EBITDA, and Adjusted EBITDA margin should not be construed as an inference that its future results will be unaffected by unusual or non-recurring items. In addition, Adjusted net income, free cash flow, Adjusted SG&A and Adjusted EBITDA may not be comparable to similarly titled measures used by other companies in GMS’s industry or across different industries. Please see the tables at the end of this release for a reconciliation of Adjusted EBITDA, free cash flow, Adjusted SG&A and Adjusted net income to the most directly comparable GAAP financial measures.

When calculating organic net sales growth, the Company excludes from the calculation (i) net sales of acquired businesses until the first anniversary of the acquisition date, and (ii) the impact of foreign currency translation.

Forward-Looking Statements and Information

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You can generally identify forward-looking statements by the Company’s use of forward-looking terminology such as “anticipate,” “believe,” “confident,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “seek,” or “should,” or the negative thereof or other variations thereon or comparable terminology. In particular, statements about the markets in which GMS operates, including in particular residential and commercial construction, and the economy generally, including interest rates, pricing including, by not limited to, the ability to implement and maintain manufacturers’ price increases, commodities pricing, the demand for the Company’s products, the Company’s strategic priorities and the results thereof, service levels and the ability to drive value and results contained in this press release may be considered forward-looking statements. In addition, forward looking statements may include statements regarding the Company’s expectations concerning management’s plans for execution of a stock repurchase program, including the maximum amount, manner and duration of the purchase of the Company’s common stock under its authorized stock repurchase program. The Company has based forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond its control, including economic issues, geopolitical issues, and future public health issues, that may affect the Company’s business. Forward-looking statements involve risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section in the Company’s most recent Annual Report on Form 10-K, and in its other periodic reports filed with the SEC. In addition, the statements in this release are made as of June 20, 2024. The Company undertakes no obligation to update any of the forward-looking statements made herein, whether as a result of new information, future events, changes in expectation or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to June 20, 2024.

GMS Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
​	Three Months Ended								Year Ended
	April 30,								April 30,
​	2024				2023				2024				2023
Net sales	$	1,413,029			$	1,304,102			$	5,501,907			$	5,329,252
Cost of sales (exclusive of depreciation and amortization shown separately below)		961,831				879,626				3,726,806				3,603,307
Gross profit		451,198				424,476				1,775,101				1,725,945
Operating expenses:
Selling, general and administrative		315,518				279,764				1,198,899				1,093,827
Depreciation and amortization		35,603				30,822				133,362				126,907
Total operating expenses		351,121				310,586				1,332,261				1,220,734
Operating income		100,077				113,890				442,840				505,211
Other (expense) income:
Interest expense		(19,021	)			(18,184	)			(75,461	)			(65,843	)
Write-off of debt discount and deferred financing fees		(674	)			—				(2,075	)			—
Other income, net		2,685				2,677				8,862				8,135
Total other expense, net		(17,010	)			(15,507	)			(68,674	)			(57,708	)
Income before taxes		83,067				98,383				374,166				447,503
Provision for income taxes		26,680				22,790				98,087				114,512
Net income	$	56,387			$	75,593			$	276,079			$	332,991
Weighted average common shares outstanding:
Basic		39,830				41,239				40,229				41,904
Diluted		40,539				41,913				40,906				42,592
Net income per common share:
Basic	$	1.42			$	1.83			$	6.86			$	7.95
Diluted	$	1.39			$	1.80			$	6.75			$	7.82

GMS Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands, except per share data)
​	April 30, 2024				April 30, 2023
Assets
Current assets:	​
Cash and cash equivalents	$	166,148			$	164,745
Trade accounts and notes receivable, net of allowances of $16,930 and $13,636, respectively		849,993				792,232
Inventories, net		580,830				575,495
Prepaid expenses and other current assets		42,352				17,051
Total current assets		1,639,323				1,549,523
Property and equipment, net of accumulated depreciation of $309,850 and $264,650, respectively		472,257				396,419
Operating lease right-of-use assets		251,207				189,351
Goodwill		853,767				700,813
Intangible assets, net		502,688				399,660
Deferred income taxes		21,890				19,839
Other assets		18,708				11,403
Total assets	$	3,759,840			$	3,267,008
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	420,237			$	377,003
Accrued compensation and employee benefits		125,610				119,887
Other accrued expenses and current liabilities		111,204				107,675
Current portion of long-term debt		50,849				54,035
Current portion of operating lease liabilities		49,150				47,681
Total current liabilities		757,050				706,281
Non-current liabilities:
Long-term debt, less current portion		1,229,726				1,044,642
Long-term operating lease liabilities		204,865				141,786
Deferred income taxes, net		62,698				51,223
Other liabilities		44,980				48,319
Total liabilities		2,299,319				1,992,251
Commitments and contingencies
Stockholders' equity:
Common stock, par value $0.01 per share, 500,000 shares authorized; 39,754 and 40,971 shares issued and outstanding as of April 30, 2024 and 2023, respectively		397				410
Preferred stock, par value $0.01 per share, 50,000 shares authorized; 0 shares issued and outstanding as of April 30, 2024 and 2023		—				—
Additional paid-in capital		334,596				428,508
Retained earnings		1,157,047				880,968
Accumulated other comprehensive loss		(31,519	)			(35,129	)
Total stockholders' equity		1,460,521				1,274,757
Total liabilities and stockholders' equity	$	3,759,840			$	3,267,008

GMS Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
	Year Ended April 30,
​	2024				2023
Cash flows from operating activities:					​
Net income	$	276,079			$	332,991
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		133,362				126,907
Write-off and amortization of debt discount and debt issuance costs		4,704				1,468
Equity-based compensation		22,436				22,098
Gain on disposal of assets		(729	)			(1,413	)
Deferred income taxes		3,685				220
Other items, net		8,766				13,270
Changes in assets and liabilities net of effects of acquisitions:
Trade accounts and notes receivable		(26,573	)			(37,024	)
Inventories		17,067				(16,802	)
Prepaid expenses and other assets		(18,652	)			1,367
Accounts payable		22,147				6,665
Accrued compensation and employee benefits		5,795				11,754
Other accrued expenses and liabilities		(14,838	)			(19,764	)
Cash provided by operating activities		433,249				441,737
Cash flows from investing activities:
Purchases of property and equipment		(57,247	)			(52,672	)
Proceeds from sale of assets		2,668				2,879
Acquisition of businesses, net of cash acquired		(376,192	)			(61,677	)
Cash used in investing activities		(430,771	)			(111,470	)
Cash flows from financing activities:
Repayments on revolving credit facility		(605,409	)			(647,247	)
Borrowings from revolving credit facility		765,373				546,113
Payments of principal on long-term debt		(2,500	)			(5,110	)
Payments of principal on finance lease obligations		(41,786	)			(35,845	)
Borrowings from term loan amendments		390,574				—
Repayments of term loan amendments		(390,076	)			—
Repurchases of common stock		(116,439	)			(110,776	)
Payment of acquisition holdback liability		—				(13,500	)
Debt issuance costs		(7,070	)			(3,157	)
Proceeds from exercises of stock options		6,336				4,715
Payments for taxes related to net share settlement of equity awards		(4,026	)			(4,005	)
Proceeds from issuance of stock pursuant to employee stock purchase plan		4,586				3,203
Cash used in financing activities		(437	)			(265,609	)
Effect of exchange rates on cash and cash equivalents		(638	)			(1,829	)
Increase in cash and cash equivalents		1,403				62,829
Cash and cash equivalents, beginning of year		164,745				101,916
Cash and cash equivalents, end of year	$	166,148			$	164,745
Supplemental cash flow disclosures:
Cash paid for income taxes	$	120,352			$	110,366
Cash paid for interest		70,798				61,752

GMS Inc.
Net Sales by Product Group (Unaudited)
(dollars in thousands)
​	Three Months Ended												Year Ended
​	April 30, 2024			% of Total			April 30, 2023			% of Total			April 30, 2024			% of Total			April 30, 2023			% of Total
​
Wallboard	$	586,052		41.5	%		$	544,684		41.8	%		$	2,263,337		41.1	%		$	2,151,505		40.4	%
Ceilings		188,873		13.4	%			155,135		11.9	%			695,151		12.6	%			628,821		11.8	%
Steel framing		220,499		15.6	%			223,810		17.2	%			892,730		16.2	%			1,011,309		19.0	%
Complementary products		417,605		29.5	%			380,473		29.1	%			1,650,689		29.9	%			1,537,617		28.9	%
Total net sales	$	1,413,029					$	1,304,102					$	5,501,907					$	5,329,252

GMS Inc.
Net Sales and Organic Sales by Product Group (Unaudited)
(dollars in millions)
​	Net Sales								Organic Sales
​	Three Months Ended April 30,								Three Months Ended April 30,
​	2024			2023		Change			2024			2023		Change
Wallboard	$	586.0		$	544.7	7.6	%		$	577.4		$	544.7	6.0	%
Ceilings		188.9			155.1	21.7	%			172.8			155.1	11.4	%
Steel framing		220.5			223.8	(1.5	)%			212.4			223.8	(5.1	)%
Complementary products		417.6			380.5	9.8	%			393.7			380.5	3.5	%
Total net sales	$	1,413.0		$	1,304.1	8.4	%		$	1,356.3		$	1,304.1	4.0	%

​	Net Sales								Organic Sales
​	Year Ended April 30,								Year Ended April 30,
​	2024			2023		Change			2024			2023		Change
Wallboard	$	2,263.3		$	2,151.5	5.2	%		$	2,248.1		$	2,151.5	4.5	%
Ceilings		695.2			628.8	10.6	%			667.4			628.8	6.1	%
Steel framing		892.7			1,011.3	(11.7	)%			877.6			1,011.3	(13.2	)%
Complementary products		1,650.7			1,537.6	7.4	%			1,554.0			1,537.6	1.1	%
Total net sales	$	5,501.9		$	5,329.2	3.2	%		$	5,347.1		$	5,329.2	0.3	%

GMS Inc.
Per Day Net Sales and Per Day Organic Sales by Product Group (Unaudited)
(dollars in millions)
​	Per Day Net Sales								Per Day Organic Sales
​	Three Months Ended April 30,								Three Months Ended April 30,
​	2024			2023		Change			2024			2023		Change
Wallboard	$	9.2		$	8.6	5.9	%		$	9.0		$	8.6	4.3	%
Ceilings		3.0			2.5	19.8	%			2.7			2.5	9.7	%
Steel framing		3.4			3.6	(3.0	)%			3.3			3.6	(6.6	)%
Complementary products		6.5			6.0	8.0	%			6.2			6.0	1.9	%
Total net sales	$	22.1		$	20.7	6.7	%		$	21.2		$	20.7	2.4	%

​	Per Day Net Sales								Per Day Organic Sales
​	Year Ended April 30,								Year Ended April 30,
​	2024			2023		Change			2024			2023		Change
Wallboard	$	8.9		$	8.5	4.4	%		$	8.8		$	8.5	3.7	%
Ceilings		2.7			2.5	9.7	%			2.6			2.5	5.3	%
Steel framing		3.5			4.0	(12.4	)%			3.4			4.0	(13.9	)%
Complementary products		6.5			6.1	6.5	%			6.1			6.1	0.3	%
Total net sales	$	21.6		$	21.1	2.4	%		$	20.9		$	21.1	(0.5	)%

​	Per Day Organic Growth(a)						Per Day Organic Growth(a)
	Three Months Ended April 30, 2024						Year Ended April 30, 2024
​	Volume			Price/Mix/Fx			Volume			Price/Mix/Fx
Wallboard	6.3	%		(1.9	)%		2.0	%		1.7	%
Ceilings	5.5	%		4.2	%		3.5	%		1.8	%
Steel framing	6.9	%		(13.5	)%		10.8	%		(24.7	)%

________________________________________

(a)	Given the wide breadth of offerings and units of measure in Complementary Products, detailed price vs volume reporting is not available at a consolidated level.

GMS Inc.
Reconciliation of Net Income to Adjusted EBITDA (Unaudited)
(in thousands)
​	Three Months Ended								Year Ended
​	April 30,								April 30,
​	2024				2023				2024				2023
Net income	$	56,387			$	75,593			$	276,079			$	332,991
Interest expense		19,021				18,184				75,461				65,843
Write-off of debt discount and deferred financing fees		674				—				2,075				—
Interest income		(610	)			(897	)			(1,754	)			(1,287	)
Provision for income taxes		26,680				22,790				98,087				114,512
Depreciation expense		18,640				15,964				69,206				61,177
Amortization expense		16,963				14,858				64,156				65,730
EBITDA	$	137,755			$	146,492			$	583,310			$	638,966
Stock appreciation expense(a)		1,983				1,815				5,391				7,703
Redeemable noncontrolling interests(b)		302				(25	)			1,427				1,178
Equity-based compensation(c)		3,644				3,019				15,618				13,217
Severance and other permitted costs(d)		307				2,372				2,628				2,788
Transaction costs (acquisitions and other)(e)		1,483				807				4,856				1,961
Gain on disposal of assets(f)		(66	)			(799	)			(729	)			(1,413	)
Effects of fair value adjustments to inventory(g)		1,183				487				1,633				1,123
Debt transaction costs(h)		(13	)			173				1,320				173
EBITDA adjustments		8,823				7,849				32,144				26,730
Adjusted EBITDA	$	146,578			$	154,341			$	615,454			$	665,696
​
Net sales	$	1,413,029			$	1,304,102			$	5,501,907			$	5,329,252
Adjusted EBITDA Margin		10.4	%			11.8	%			11.2	%			12.5	%

___________________________________

(a)	Represents changes in the fair value of stock appreciation rights.
(b)	Represents changes in the fair values of noncontrolling interests and deferred compensation agreements.
(c)	Represents non-cash equity-based compensation expense related to the issuance of share-based awards.
(d)	Represents severance expenses and other costs permitted in the calculation of Adjusted EBITDA under the ABL Facility and the Term Loan Facility.
(e)	Represents costs related to acquisitions paid to third parties.
(f)	Includes gains and losses from the sale and disposal of assets.
(g)	Represents the non-cash cost of sales impact of acquisition accounting adjustments to increase inventory to its estimated fair value.
(h)	Represents costs paid to third-party advisors related to debt refinancing activities.​

GMS Inc.
Reconciliation of Cash Provided By Operating Activities to Free Cash Flow (Unaudited)
(in thousands)
​	Three Months Ended								Year Ended
​	April 30,								April 30,
​	2024				2023				2024				2023
Cash provided by operating activities	$	204,223			$	204,810			$	433,249			$	441,737
Purchases of property and equipment		(17,519	)			(19,422	)			(57,247	)			(52,672	)
Free cash flow (a)	$	186,704			$	185,388			$	376,002			$	389,065

________________________________________

(a)	Free cash flow is a non-GAAP financial measure that we define as net cash provided by (used in) operations less capital expenditures.

GMS Inc.
Reconciliation of Selling, General and Administrative Expense to Adjusted SG&A (Unaudited)
(in thousands)
​	Three Months Ended								Year Ended
​	April 30,								April 30,
​	2024				2023				2024				2023
Selling, general and administrative expense	$	315,518			$	279,764			$	1,198,899			$	1,093,827
Adjustments
Stock appreciation expense(a)		(1,983	)			(1,815	)			(5,391	)			(7,703	)
Redeemable noncontrolling interests(b)		(302	)			25				(1,427	)			(1,178	)
Equity-based compensation(c)		(3,644	)			(3,019	)			(15,618	)			(13,217	)
Severance and other permitted costs(d)		(307	)			(2,384	)			(2,628	)			(2,875	)
Transaction costs (acquisitions and other)(e)		(1,483	)			(807	)			(4,856	)			(1,961	)
Gain on disposal of assets(f)		66				799				729				1,413
Debt transaction costs(g)		13				(173	)			(1,320	)			(173	)
Adjusted SG&A	$	307,878			$	272,390			$	1,168,388			$	1,068,133
Net sales	$	1,413,029			$	1,304,102			$	5,501,907			$	5,329,252
Adjusted SG&A margin		21.8	%			20.9	%			21.2	%			20.0	%

___________________________________

(a)	Represents changes in the fair value of stock appreciation rights.
(b)	Represents changes in the fair values of noncontrolling interests and deferred compensation agreements.
(c)	Represents non-cash equity-based compensation expense related to the issuance of share-based awards.
(d)	Represents severance expenses and other costs permitted in the calculation of Adjusted EBITDA under the ABL Facility and the Term Loan Facility.
(e)	Represents costs related to acquisitions paid to third parties.
(f)	Includes gains and losses from the sale and disposal of assets.
(g)	Represents costs paid to third-party advisors related to debt refinancing activities.​

GMS Inc.
Reconciliation of Income Before Taxes to Adjusted Net Income (Unaudited)
(in thousands, except per share data)
​	Three Months Ended								Year Ended
​	April 30,								April 30,
​	2024				2023				2024				2023
Income before taxes	$	83,067			$	98,383			$	374,166			$	447,503
EBITDA adjustments		8,823				7,849				32,144				26,730
Write-off of discount and deferred financing fees		674				—				2,075				—
Acquisition accounting depreciation and amortization (1)		12,243				11,111				44,377				49,931
Adjusted pre-tax income		104,807				117,343				452,762				524,164
Adjusted income tax expense		26,726				28,749				115,454				128,420
Adjusted net income	$	78,081			$	88,594			$	337,308			$	395,744
Effective tax rate (2)		25.5	%			24.5	%			25.5	%			24.5	%
Weighted average shares outstanding:
Basic		39,830				41,239				40,229				41,904
Diluted		40,539				41,913				40,906				42,592
Adjusted net income per share:
Basic	$	1.96			$	2.15			$	8.38			$	9.44
Diluted	$	1.93			$	2.11			$	8.25			$	9.29

________________________________________

(1)	Depreciation and amortization from the increase in value of certain long-term assets associated with the April 1, 2014 acquisition of the predecessor company and amortization of intangible assets from the acquisitions of Titan, Westside Building Materials, Ames Taping Tools and Kamco Supply Corporation.
(2)	Normalized cash tax rate excluding the impact of acquisition accounting and certain other deferred tax amounts.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240620433554/en/

Investors:

Carey Phelps

ir@gms.com

770-723-3369

Source: GMS Inc.

FAQ

What were GMS's Q4 2024 net sales?

GMS reported Q4 2024 net sales of $1.41 billion, an 8.4% increase from the previous year.

How did GMS's net income perform in Q4 2024?

Net income for Q4 2024 was $56.4 million, a decrease of 25.4% from the same period last year.

What was GMS's free cash flow for FY 2024?

GMS reported free cash flow of $186.7 million for FY 2024, compared to $185.4 million in FY 2023.

What acquisitions did GMS complete in FY 2024?

GMS completed the acquisition of Kamco Supply , expanding its presence in the New York City market.

How many shares did GMS repurchase in FY 2024?

GMS repurchased 1.7 million shares of common stock for $115.6 million at an average cost of $67.93 per share.

What are GMS's expectations for the single-family market in FY 2025?

GMS expects a mild recovery in the single-family market in FY 2025, which may help offset declining multi-family and commercial demand.