Interface (TILE) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales reached $346.6 million, up 5.2% year-over-year, with currency neutral growth of 5.8%.

• Adjusted gross profit margin expanded to 35.7%, up 183 basis points year-over-year.

• Adjusted EPS was $0.40, up from $0.25 in Q2 last year, and net income was $22.6 million ($0.38 per diluted share).

• Growth driven by strong performance in the Americas, especially education and corporate office segments, and supported by the One Interface strategy.

• Backlog increased 33% year-to-date, supporting positive momentum into the second half of 2024.

Financial highlights

• Q2 2024 net sales: $346.6 million, up 5.2% year-over-year; adjusted operating income: $39.6 million, up 42% year-over-year.

• Adjusted EBITDA: $50.5 million, up from $39.8 million in Q2 last year.

• Adjusted gross profit margin: 35.7%, up 183 basis points year-over-year.

• Cash from operations: $21.5 million in Q2; liquidity at $385 million; cash on hand at quarter-end was $94.2 million.

• Net debt at quarter-end was $293.4 million; net debt/LTM adjusted EBITDA was 1.6x.

Outlook and guidance

• Full-year 2024 net sales guidance raised to $1.3–$1.32 billion; adjusted gross profit margin of ~36%.

• Q3 2024 guidance: net sales of $330–$340 million, adjusted gross profit margin ~36%, adjusted SG&A ~$86 million.

• Full-year 2024: adjusted SG&A ~$342 million, capex ~$42 million.

• Liquidity expected to be sufficient for the next 12 months, with strong backlog supporting future growth.