TopBuild (BLD) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales declined 3.6% to $1.23B, driven by a 7.4% volume decrease, with installation sales down 6.7% and specialty distribution up 2.6%; commercial and industrial growth partially offset residential softness.

• Adjusted EBITDA was $234.8M (19% margin), and net income was $123.4M, both down year-over-year; operational improvements included facility consolidations and headcount reductions.

• $215.6M was returned to shareholders via repurchases in Q1, with $972.4M remaining under current authorization.

• Acquisition of Seal-Rite Insulation completed in April 2025, expanding presence and adding $15M–$23M in annual revenue.

• Management remains optimistic about long-term fundamentals, citing strong housing demand and positive commercial/industrial trends.

Financial highlights

• Q1 net sales: $1.23B, down 3.6% year-over-year; adjusted gross margin: 29.6%; adjusted EBITDA margin: 19.0%.

• Adjusted operating profit: $194.1M (15.7% margin); net income: $123.4M; diluted EPS: $4.23; adjusted EPS: $4.63.

• Free cash flow for the trailing twelve months: $790.1M; cash flow from operations: $152.6M.

• Net debt: $1.07B; net leverage ratio: 1.00x; total liquidity: $746.4M (cash: $308.8M; revolver: $437.6M).

• One-time Q1 costs: $13.9M for facility consolidations and $1.5M for severance.

Outlook and guidance

• Full-year 2025 sales guidance confirmed at $5.05B–$5.35B; adjusted EBITDA guidance: $925M–$1.075B.

• Residential sales expected down high single digits; commercial/industrial up low single digits.

• Q2 expected to have the largest year-over-year sales decline; sequential improvement anticipated in Q3 and Q4.

• Guidance excludes potential future acquisitions or divestitures.

• Management expects continued operational discipline and targeted investments.