Form 8-K
false 0001580905 0001580905 2020-08-06 2020-08-06

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

August 6, 2020

Date of Report (Date of earliest event reported)

 

 

Installed Building Products, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-36307   45-3707650

(State or other jurisdiction

of incorporation)

 

(Commission

File No.)

 

(IRS Employer

Identification No.)

495 South High Street, Suite 50

Columbus, Ohio 43215

(Address of principal executive offices, zip code)

(614) 221-3399

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instructions A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Common stock   IBP   New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 2.02

Results of Operations and Financial Condition.

On August 6, 2020, Installed Building Products, Inc. (the “Company”) issued a press release reporting the financial results for the three and six months ended June 30, 2020. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information contained in this Item 2.02, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. Furthermore, the information contained in this Item 2.02, including Exhibit 99.1 attached hereto, shall not be deemed to be incorporated by reference into any registration statement or other document filed with the Securities and Exchange Commission, except as shall be expressly set forth by specific reference in such filing.

 

Item 7.01

Regulation FD Disclosure.

One or more representatives of the Company will meet with certain current and prospective investors during the third quarter of 2020. The materials used in connection with these meetings have been posted on the Company’s website (www.installeduildingproducts.com) under the Investor Relations section.

The information contained in this Item 7.01 is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. Furthermore, the information contained in this Item 7.01 shall not be deemed to be incorporated by reference into any registration statement or other document filed with the Securities and Exchange Commission, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
Number

  

Description

99.1    Press Release, dated August 6, 2020, announcing results for the three and six months ended June 30, 2020.
104    Cover Page Interactive Data File (formatted in Inline XBRL)


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    INSTALLED BUILDING PRODUCTS, INC.
Date: August 6, 2020     By:  

/s/ Michael T. Miller

      Executive Vice President and
      Chief Financial Officer
EX-99.1

Exhibit 99.1

 

LOGO

INSTALLED BUILDING PRODUCTS REPORTS

RECORD SECOND QUARTER 2020 RESULTS

Columbus, Ohio, August 6, 2020 Installed Building Products, Inc. (the “Company” or “IBP”) (NYSE:IBP), an industry-leading installer of insulation and complementary building products, today announced results for the second quarter ended June 30, 2020.

Second Quarter 2020 Highlights (Comparisons are to Prior Year Period)

 

   

Net revenue increased 6.0% to a second quarter record of $393.9 million, despite reduced volume associated with branches temporarily closed during the quarter

 

   

Residential sales increased 5.6%

 

   

Large commercial sales increased 7.5%

 

   

Net income increased 33.9% to a record $25.3 million

 

   

Adjusted EBITDA* increased 27.1% to a record $63.1 million

 

   

Net income per diluted share increased 36.5% to $0.86

 

   

Adjusted net income per diluted share* increased 28.7% to $1.12

 

   

Net cash provided by operating activities for the three months ended June 30, 2020 increased 90.7% to $69.6 million

 

   

At June 30, 2020, IBP had $269.2 million in cash and cash equivalents, and investments, with nothing drawn on the existing $200 million revolving line of credit

 

   

In June 2020, acquired Nationwide Gutter, LLC, a Texas based provider of gutter installation and repair services primarily to multi-family and commercial customers, with annual revenue of approximately $5.2 million

“Despite the unprecedented challenges caused by the COVID-19 health crisis, IBP achieved multiple milestones for the 2020 second quarter including record second quarter sales and profitability,” stated Jeff Edwards, Chairman and Chief Executive Officer. “These record results demonstrate the success of our ongoing geographic, end-market, and end-product diversification strategies, the benefits of our pricing strategies, and the hard work and dedication of our employees. In addition, the homebuilding industry has rebounded quickly during the second quarter and we experienced significant growth in our multi-family and commercial end-markets during the quarter. Based on our record second quarter results, current industry backlogs, and our solid liquidity position, we started closing transactions from our strong acquisition pipeline in June.”

“Across our national footprint, our branches continue to follow federal, state, and local requirements in response to COVID-19. At the start of the second quarter, several of our branches where construction was not deemed essential were closed, which impacted revenue by approximately $10 million to $12 million. Operations have resumed across all IBP branches, but several recently re-opened locations are not yet at full capacity. We continue to closely monitor the evolving COVID-19 crisis and we will make the necessary adjustments to protect and support our employees and customers across the country.”

“While overall housing trends have improved significantly from April and May of this year, our single-family market demand may be temporarily impacted by the normal lag between starts and completions as a result of the market disruptions that occurred during the early stages of the pandemic. We believe that IBP’s growing presence within the multi-family and commercial end markets and the industry backlog of single-

 

1


family units under construction, combined with our acquisition strategy, will help us navigate any near-term softness created by the April and May declines in single-family housing starts. Overall, our operating and financial results continue to demonstrate the compelling business model we have created, which has allowed us to effectively respond to recent market conditions, while also providing IBP with a strong platform for long-term value creation,” concluded Mr. Edwards.

Second Quarter 2020 Results Overview

For the second quarter of 2020, net revenue was $393.9 million, an increase of 6.0% from $371.8 million in the second quarter of 2019. On a same branch basis, net revenue improved 2.3% from the prior year quarter. Residential same branch sales growth was 2.5% in the quarter, attributable to price gains and more favorable customer and product mix, compared to a decline in total completions of 2.9%. Our large commercial construction end-market increased 7.5% for the second quarter of 2020.

Gross profit improved 18.5% to $127.1 million from $107.3 million in the prior year quarter. Adjusted gross profit* as a percent of total revenue was the highest we have reported as a public company of 32.4% which adjusts for the Company’s share-based compensation expense, branch start-up costs and employee-related expenses associated with the COVID-19 pandemic, compared to 29.0% for the same period last year. Selling and administrative expense, as a percent of net revenue, was 19.8% compared to 18.9% in the prior year quarter. Adjusted selling and administrative expense*, as a percent of net revenue, was 18.9% compared to 18.2% in the prior year quarter. This increase was attributable to higher variable employee expenses and insurance reserves.

Net income was $25.3 million, or $0.86 per diluted share, compared to $18.9 million, or $0.63 per diluted share in the prior year quarter. Adjusted net income* was $33.2 million, or $1.12 per diluted share, compared to $25.9 million, or $0.87 per diluted share in the prior year quarter. Adjusted net income adjusts for the impact of non-core items in both periods, including COVID-19 expenses and an addback for non-cash amortization expense related to acquisitions.

Adjusted EBITDA* was $63.1 million, a 27.1% increase from $49.6 million in the prior year quarter, largely due to higher sales and improved gross profit margin compared to the prior year quarter.

Conference Call and Webcast

The Company will host a conference call and webcast on Thursday, August 6, 2020 at 10:00 a.m. Eastern Time to discuss these results. To participate in the call, please dial 877-407-0792 (domestic) or 201-689-8263 (international). The live webcast will be available at www.installedbuildingproducts.com in the investor relations section. A replay of the conference call will be available through September 6, 2020, by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the passcode 13705636.

About Installed Building Products

Installed Building Products, Inc. is one of the nation’s largest new residential insulation installers and is a diversified installer of complementary building products, including waterproofing, fire-stopping, fireproofing, garage doors, rain gutters, window blinds, shower doors, closet shelving and mirrors and other products for residential and commercial builders located in the continental United States. The Company manages all aspects of the installation process for its customers, from direct purchase and receipt of materials from national manufacturers to its timely supply of materials to job sites and quality installation. The Company offers its portfolio of services for new and existing single-family and multi-family residential and commercial building projects from its national network of over 180 branch locations.

 

2


Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, including with respect to the housing market, our financial and business model, the demand for our services and product offerings, the impact of the COVID-19 crisis on our business and end markets, expansion of our national footprint and end markets, diversification of our products, our ability to capitalize on the new home and commercial construction recovery, our ability to grow and strengthen our market position, our ability to pursue and integrate value-enhancing acquisitions, our ability to improve sales and profitability, the impact of the COVID-19 crisis on our financial results, and expectations for demand for our services and our earnings in 2020. Forward-looking statements may generally be identified by the use of words such as “anticipate,” “believe,” “expect,” “intends,” “plan,” and “will” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Any forward-looking statements that we make herein and in any future reports and statements are not guarantees of future performance, and actual results may differ materially from those expressed in or suggested by such forward-looking statements as a result of various factors, including, without limitation, the duration, effect and severity of the COVID-19 crisis; the adverse impact of the COVID-19 crisis on our business and financial results, the economy and the markets we serve; general economic and industry conditions, the material price environment; the timing of increases in our selling prices, and the factors discussed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission. Any forward-looking statement made by the Company in this press release speaks only as of the date hereof. New risks and uncertainties arise from time to time, and it is impossible for the Company to predict these events or how they may affect it. The Company has no obligation, and does not intend, to update any forward-looking statements after the date hereof, except as required by federal securities laws.

*Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release contains the non-GAAP financial measures of Adjusted EBITDA, Adjusted EBITDA margin (i.e., Adjusted EBITDA divided by net revenue), Adjusted Net Income, Adjusted Net Income per diluted share, Adjusted Gross Profit and Adjusted Selling and Administrative expense. The reasons for the use of these measures, reconciliations of Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per diluted share, Adjusted Gross Profit, and Adjusted Selling and Administrative expense to the most directly comparable GAAP measures and other information relating to these measures are included below following the unaudited condensed consolidated financial statements. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for IBP’s financial results prepared in accordance with GAAP.

 

3


INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(unaudited, in thousands, except share and per share amounts)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Net revenue

   $ 393,939     $ 371,814     $ 791,270     $ 713,949  

Cost of sales

     266,800       264,557       547,871       517,254  
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     127,139       107,257       243,399       196,695  

Operating expenses

        

Selling

     19,011       17,903       39,366       35,033  

Administrative

     59,060       52,493       119,255       100,924  

Amortization

     6,724       6,021       13,404       11,909  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     42,344       30,840       71,374       48,829  

Other expense

        

Interest expense, net

     7,757       5,649       15,115       11,325  

Other

     129       101       129       226  
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     34,458       25,090       56,130       37,278  

Income tax provision

     9,121       6,171       14,805       9,525  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 25,337     $ 18,919     $ 41,325     $ 27,753  
  

 

 

   

 

 

   

 

 

   

 

 

 

Other comprehensive loss, net of tax:

        

Unrealized loss on cash flow hedge, net of tax benefit of $51 and $1,180 for the three months ended June 30, 2020 and 2019, respectively, and $1,990 and $2,101 for the six months ended June 30, 2020 and 2019, respectively

     (150     (3,546     (5,758     (6,295
  

 

 

   

 

 

   

 

 

   

 

 

 

Comprehensive income

   $ 25,187     $ 15,373     $ 35,567     $ 21,458  
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic net income per share

   $ 0.86     $ 0.64     $ 1.40     $ 0.93  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted net income per share

   $ 0.86     $ 0.63     $ 1.39     $ 0.93  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares outstanding:

        

Basic

     29,447,121       29,758,071       29,584,782       29,719,194  

Diluted

     29,584,167       29,834,748       29,757,560       29,820,917  

 

4


INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share and per share amounts)

 

     June 30,     December 31,  
     2020     2019  

ASSETS

    

Current assets

    

Cash and cash equivalents

   $ 252,488     $ 177,889  

Investments

     16,688       37,961  

Accounts receivable (less allowance for credit losses of $9,617 and $6,878 at June 30, 2020 and December 31, 2019, respectively)

     247,627       244,519  

Inventories

     69,149       74,606  

Other current assets

     33,996       46,974  
  

 

 

   

 

 

 

Total current assets

     619,948       581,949  

Property and equipment, net

     103,422       106,410  

Operating lease right-of-use assets

     47,448       45,691  

Goodwill

     200,264       195,652  

Intangibles, net

     147,117       153,562  

Other non-current assets

     12,851       16,215  
  

 

 

   

 

 

 

Total assets

   $ 1,131,050     $ 1,099,479  
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities

    

Current maturities of long-term debt

   $ 24,230     $ 24,164  

Current maturities of operating lease obligations

     16,209       15,459  

Current maturities of finance lease obligations

     2,333       2,747  

Accounts payable

     81,386       98,871  

Accrued compensation

     36,520       33,636  

Other current liabilities

     53,371       39,272  
  

 

 

   

 

 

 

Total current liabilities

     214,049       214,149  

Long-term debt

     544,976       545,031  

Operating lease obligations

     30,721       29,785  

Finance lease obligations

     3,051       3,597  

Deferred income taxes

     5,022       9,175  

Other long-term liabilities

     60,495       47,711  
  

 

 

   

 

 

 

Total liabilities

     858,314       849,448  

Commitments and contingencies

    

Stockholders’ equity

    

Preferred Stock; $0.01 par value: 5,000,000 authorized and 0 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively

     —         —    

Common stock; $0.01 par value: 100,000,000 authorized, 33,124,237 and 32,871,504 issued and 29,799,188 and 30,016,340 shares outstanding at June 30, 2020 and December 31, 2019, respectively

     331       329  

Additional paid in capital

     195,288       190,230  

Retained earnings

     213,506       173,371  

Treasury stock; at cost: 3,325,049 and 2,855,164 shares at June 30, 2020 and December 31, 2019, respectively

     (123,488     (106,756

Accumulated other comprehensive loss

     (12,901     (7,143
  

 

 

   

 

 

 

Total stockholders’ equity

     272,736       250,031  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 1,131,050     $ 1,099,479  
  

 

 

   

 

 

 

 

5


INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

 

     Six months ended June 30,  
     2020     2019  

Cash flows from operating activities

    

Net income

   $ 41,325     $ 27,753  

Adjustments to reconcile net income to net cash provided by operating activities

    

Depreciation and amortization of property and equipment

     20,623       18,614  

Amortization of operating lease right-of-use assets

     8,545       7,607  

Amortization of intangibles

     13,404       11,909  

Amortization of deferred financing costs and debt discount

     670       564  

Provision for credit losses

     2,668       1,605  

Gain on sale of property and equipment

     (144     (156

Noncash stock compensation

     5,415       4,345  

Deferred income taxes

     (1,679     —    

Changes in assets and liabilities, excluding effects of acquisitions

    

Accounts receivable

     (3,158     (17,876

Inventories

     6,072       (1,650

Other assets

     9,351       (1,495

Accounts payable

     (18,504     (1,253

Income taxes receivable/payable

     16,015       6,347  

Other liabilities

     4,922       (3,914
  

 

 

   

 

 

 
     105,525       52,400  
  

 

 

   

 

 

 

Cash flows from investing activities

    

Purchases of investments

     (776     (17,352

Maturities of short term investments

     22,050       17,560  

Purchases of property and equipment

     (16,345     (17,778

Acquisitions of businesses

     (12,625     (21,290

Proceeds from sale of property and equipment

     314       452  

Other

     (1,340     (876
  

 

 

   

 

 

 
     (8,722     (39,284
  

 

 

   

 

 

 

Cash flows from financing activities

    

Payments on term loan

     —         (2,000

Proceeds from vehicle and equipment notes payable

     12,768       13,783  

Debt issuance costs

     (157      

Principal payments on long-term debt

     (13,205     (9,751  

Principal payments on finance lease obligations

     (1,392     (2,481

Acquisition-related obligations

     (3,486     (5,039

Repurchase of common stock

     (15,759     —    

Surrender of common stock awards by employees

     (973     (2,323
  

 

 

   

 

 

 
     (22,204     (7,811
  

 

 

   

 

 

 

Net change in cash and cash equivalents

     74,599       5,305  

Cash and cash equivalents at beginning of period

     177,889       90,442  
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 252,488     $ 95,747  
  

 

 

   

 

 

 

Supplemental disclosures of cash flow information

    

Net cash paid during the period for:

    

Interest

   $ 13,006     $ 11,793  

Income taxes, net of refunds

     476       3,595  

Supplemental disclosure of noncash activities

    

Right-of-use assets obtained in exchange for operating lease obligations

     10,229       8,677  

Property and equipment obtained in exchange for finance lease obligations

     600       1,830  

Seller obligations in connection with acquisition of businesses

     4,037       3,162  

Unpaid purchases of property and equipment included in accounts payable

     1,981       2,334  

 

6


Reconciliation of Non-GAAP Financial Measures

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Gross Profit and Adjusted Selling and Administrative Expense measure performance by adjusting EBITDA, GAAP net income, gross profit and selling and administrative expense, respectively, for certain income or expense items that are not considered part of our core operations. We believe that the presentation of these measures provides useful information to investors regarding our results of operations because it assists both investors and us in analyzing and benchmarking the performance and value of our business.

We believe the Adjusted EBITDA measure is useful to investors and us as a measure of comparative operating performance from period to period as it measures our changes in pricing decisions, cost controls and other factors that impact operating performance, and removes the effect of our capital structure (primarily interest expense), asset base (primarily depreciation and amortization), items outside our control (primarily income taxes) and the volatility related to the timing and extent of other activities such as asset impairments and non-core income and expenses. Accordingly, we believe that this measure is useful for comparing general operating performance from period to period. In addition, we use various EBITDA-based measures in determining the achievement of awards under certain of our incentive compensation programs. Other companies may define Adjusted EBITDA differently and, as a result, our measure may not be directly comparable to measures of other companies. In addition, Adjusted EBITDA may be defined differently for purposes of covenants contained in our revolving credit facility or any future facility.

Although we use the Adjusted EBITDA measure to assess the performance of our business, the use of the measure is limited because it does not include certain material expenses, such as interest and taxes, necessary to operate our business. Adjusted EBITDA should be considered in addition to, and not as a substitute for, GAAP net income as a measure of performance. Our presentation of this measure should not be construed as an indication that our future results will be unaffected by unusual or non-recurring items. This measure has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Because of these limitations, this measure is not intended as an alternative to net income as an indicator of our operating performance, as an alternative to any other measure of performance in conformity with GAAP or as an alternative to cash flow provided by operating activities as a measure of liquidity. You should therefore not place undue reliance on this measure or ratios calculated using this measure.

We also believe the Adjusted Net Income measure is useful to investors and us as a measure of comparative operating performance from period to period as it measures our changes in pricing decisions, cost controls and other factors that impact operating performance, and removes the effect of certain non-core items such as discontinued operations, acquisition related expenses, amortization expense, the tax impact of these certain non-core items, and the volatility related to the timing and extent of other activities such as asset impairments and non-core income and expenses. To make the financial presentation more consistent with other public building products companies, beginning in the fourth quarter 2016 we included an addback for non-cash amortization expense related to acquisitions. Accordingly, we believe that this measure is useful for comparing general operating performance from period to period. Other companies may define Adjusted Net Income differently and, as a result, our measure may not be directly comparable to measures of other companies. In addition, Adjusted Net Income may be defined differently for purposes of covenants contained in our revolving credit facility or any future facility.

 

7


INSTALLED BUILDING PRODUCTS, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

ADJUSTED NET INCOME CALCULATIONS

(unaudited, in thousands, except share and per share amounts)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Net income, as reported

   $ 25,337     $ 18,919     $ 41,325     $ 27,753  

Adjustments for adjusted net income:

        

Share based compensation expense

     2,733       2,404       5,415       4,342  

Acquisition related expenses

     522       606       1,205       1,194  

COVID-19 expenses 1

     650       —         650       —    

Branch start-up costs 2

     —         357       —         617  

Amortization expense 3

     6,724       6,021       13,404       11,909  

Miscellaneous non-operating income

     —         —         (279     —    

Tax impact of adjusted items at normalized tax rate 4

     (2,764     (2,441     (5,303     (4,696
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income

   $ 33,202     $ 25,866     $ 56,417     $ 41,119  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares outstanding (diluted)

     29,584,167       29,834,748       29,757,560       29,820,917  

Diluted net income per share, as reported

   $ 0.86     $ 0.63     $ 1.39     $ 0.93  

Adjustments for adjusted net income, net of tax impact, per diluted share 5

     0.26       0.24       0.51       0.45  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted adjusted net income per share

   $ 1.12     $ 0.87     $ 1.90     $ 1.38  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

1

Addback of employee pay, employee medical expenses and legal fees directly attributable to COVID-19

2

Addback of costs related to organic branch expansion for Alpha locations

3

Addback of all non-cash amortization resulting from business combinations

4

Normalized effective tax rate of 26.0% applied to both periods presented

5 

Includes adjustments related to the items noted above, net of tax

The table below reconciles Adjusted Net Income to the most directly comparable GAAP financial measure, net income, for the periods presented therein.

Per share figures may reflect rounding adjustments and consequently totals may not appear to sum.

 

8


INSTALLED BUILDING PRODUCTS, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

ADJUSTED GROSS PROFIT CALCULATIONS

(unaudited, in thousands)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Gross profit

   $ 127,139     $ 107,257     $ 243,399     $ 196,695  

Share based compensation expense

     65       105       161       183  

COVID-19 expenses 1

     307       —         307       —    

Branch start-up costs 2

     —         357       —         617  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted gross profit

   $ 127,511     $ 107,719     $ 243,867     $ 197,495  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted gross profit - % Total Revenue

     32.4     29.0     30.8     27.7

 

1 

Addback of employee pay and employee medical expenses directly attributable to COVID-19

2 

Addback of costs related to organic branch expansion for Alpha locations

INSTALLED BUILDING PRODUCTS, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

ADJUSTED SELLING AND ADMINISTRATIVE EXPENSE CALCULATIONS

(unaudited, in thousands)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Selling expense

   $ 19,011     $ 17,903     $ 39,366     $ 35,033  

Administrative expense

     59,060       52,493       119,255       100,924  
  

 

 

   

 

 

   

 

 

   

 

 

 

Selling and Administrative

   $ 78,071     $ 70,396     $ 158,621     $ 135,957  
  

 

 

   

 

 

   

 

 

   

 

 

 

Share based compensation expense

     2,668       2,298       5,254       4,159  

Acquisition related expenses

     522       606       1,205       1,194  

COVID-19 expenses 1

     342       —         342       —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Selling and Administrative

   $ 74,539     $ 67,492     $ 151,820     $ 130,604  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adj. Selling and Administrative - % Total Revenue

     18.9     18.2     19.2     18.3

 

1

Addback of employee pay, employee medical expenses and legal fees directly attributable to COVID-19

 

9


The table below reconciles Adjusted EBITDA to the most directly comparable GAAP financial measure, net income, for the periods presented therein.

INSTALLED BUILDING PRODUCTS, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

ADJUSTED EBITDA CALCULATIONS

(unaudited, in thousands)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Adjusted EBITDA:

        

Net income (GAAP)

   $ 25,337     $ 18,919     $ 41,325     $ 27,753  

Interest expense

     7,757       5,649       15,115       11,325  

Provision for income taxes

     9,121       6,171       14,805       9,525  

Depreciation and amortization

     16,974       15,523       34,029       30,523  

Miscellaneous non-operating income

     —         —         (279     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

     59,189       46,262       104,995       79,126  
  

 

 

   

 

 

   

 

 

   

 

 

 

Acquisition related expenses

     522       606       1,205       1,194  

Share based compensation expense

     2,733       2,404       5,415       4,342  

COVID-19 expenses 1

     650       —         650       —    

Branch start-up costs

     —         357       —         617  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 63,094     $ 49,629     $ 112,265     $ 85,279  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA margin

     16.0     13.3     14.2     11.9

 

1 

Addback of employee pay, employee medical expenses and legal fees directly attributable to COVID-19

 

10


INSTALLED BUILDING PRODUCTS, INC.

SUPPLEMENTARY TABLE

(unaudited)

 

     Three months ended June 30,     Six months ended June 30,  
     2020     2019     2020     2019  

Period-over-period Growth

        

Sales Growth

     6.0     11.8     10.8     12.6

Same Branch Sales Growth

     2.3     7.8     7.0     7.6

Single-Family Sales Growth

     -0.2     9.5     5.1     11.8

Single-Family Same Branch Sales Growth

     -3.5     4.4     1.0     5.4

Residential Sales Growth

     5.6     9.5     9.7     11.5

Residential Same Branch Sales Growth

     2.5     5.2     5.9     6.0

Same Branch Sales Growth

        

Volume Growth1

     -2.1     0.7     -1.2     2.0

Price/Mix Growth1

     4.8     5.7     8.4     4.9

Large Commercial Construction Sales Growth

     7.5     21.0     10.6     13.7

U.S. Housing Market2

        

Total Completions Growth

     -2.9     0.5     -1.7     3.2

Single-Family Completions Growth

     -2.5     6.3     0.7     5.5

 

1 

Excludes the large commercial end market

2 

U.S. Census Bureau data, as revised

INSTALLED BUILDING PRODUCTS, INC.

INCREMENTAL REVENUE AND ADJUSTED EBITDA MARGINS

(unaudited, in thousands)

 

     Three months ended June 30,     Six months ended June 30,  
     2020      % Total     2019      % Total     2020      % Total     2019      % Total  

Revenue Increase

                    

Same Branch

   $ 8,680        39.2   $ 25,890        66.0   $ 50,128        64.8   $ 48,184        60.5

Acquired

     13,444        60.8     13,340        34.0     27,192        35.2     31,453        39.5
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 22,124        100.0   $ 39,230        100.0   $ 77,320        100.0   $ 79,637        100.0

 

            Adj EBITDA
Contribution
           Adj EBITDA
Contribution
           Adj EBITDA
Contribution
           Adj EBITDA
Contribution
 

Adjusted EBITDA

                    

Same Branch

   $ 11,217        129.2   $ 2,101        8.1   $ 22,503        44.9   $ 4,447        9.2

Acquired

     2,247        16.7     1,960        14.7     4,481        16.5     3,843        12.2
  

 

 

      

 

 

      

 

 

      

 

 

    

Total

   $ 13,464        60.9   $ 4,061        10.4   $ 26,984        34.9   $ 8,291        10.4

Source: Installed Building Products, Inc.

Contact Information:

Investor Relations:

614-221-9944

investorrelations@installed.net

 

11

v3.20.2
Document and Entity Information
Aug. 06, 2020
Cover [Abstract]  
Amendment Flag false
Entity Central Index Key 0001580905
Document Type 8-K
Document Period End Date Aug. 06, 2020
Entity Registrant Name Installed Building Products, Inc.
Entity Incorporation State Country Code DE
Entity File Number 001-36307
Entity Tax Identification Number 45-3707650
Entity Address, Address Line One 495 South High Street
Entity Address, Address Line Two Suite 50
Entity Address, City or Town Columbus
Entity Address, State or Province OH
Entity Address, Postal Zip Code 43215
City Area Code (614)
Local Phone Number 221-3399
Written Communications false
Soliciting Material false
Pre Commencement Tender Offer false
Pre Commencement Issuer Tender Offer false
Security 12b Title Common stock
Trading Symbol IBP
Security Exchange Name NYSE
Entity Emerging Growth Company false