Trex (TREX) investor relations material

Strategic distribution network upgrade

• Announced transition to a single national distributor, SBP, and expanded regional partners including Coastal Forest Products, BlueLinx, and WS Building Materials, aiming for a simpler, faster, and more effective distribution model.

• SBP's acquisition of OrePac gives it national scale, making it uniquely positioned to serve both the U.S. and Canada.

• All new and existing distributor partners are now exclusive for both decking and railing, ensuring Trex is the top brand in their portfolios.

• Transitioning away from Boise Cascade as a distributor to optimize channel strategy.

• Transition is expected to be completed within 30 days, with no material disruption to supply or customer service.

Financial performance and guidance update

• Preliminary Q2 net sales reached $418 million, exceeding prior guidance, with adjusted EBITDA of about $112 million.

• Raised full-year 2026 revenue guidance to $1.215–$1.25 billion and adjusted EBITDA to $335–$350 million.

• CapEx projected at $100–$120 million, with effective tax rate between 25.5% and 27%.

• Incremental SG&A costs for training and onboarding are one-time and included in the updated guidance.

• No expected material impact on margins, profitability, or underlying demand from the distribution transition.

Market and operational implications

• The new model returns to a dual distribution structure in most markets, providing flexibility and competitive options for dealers.

• No change to the overall split between two-step and big box channels; both are expected to benefit from the new structure.

• No inventory build is required for the transition, and channel inventory remains at low levels.

• Communication and support plans are in place to ensure a smooth transition for dealers and contractors.

• Financial results reflect strong consumer demand and effective execution across channels.