Beacon Roofing Supply Inc (NASDAQ:BECN) provided Q2 2023 preliminary results and an update on Series A Preferred shares repurchases.
Preferred Share Buyback: The company plans to buyback outstanding shares of 400,000 of Series A Preferred stock from CD&R for $804.5 million (plus aggregate accrued and unpaid dividends as of the repurchase date), with the transaction expected to close by August 11, 2023.
Q2 Preliminary Results: The company expects net sales to be around $2.5 billion (vs. consensus of $2.45 billion) and gross margins of about 25.4%.
BECN expects net income to be $147 million-$154 million and EPS to be $1.88-$1.97 (consensus: $2.22).
The company projects adjusted EBITDA of $280 million-$290 million.
Including the impact of the Series A Preferred Stock repurchase and the expected debt funding related to the repurchase, the company expects total gross debt less cash and cash equivalents to be around $2.5 billion as of June 30, 2023, with estimated net debt leverage of approximately 2.9x on a trailing four-quarter basis.
Post-transaction closure, the company does not expect meaningful open market repurchases of common stock under the existing repurchase authorization in the remainder of 2023.
2023 Outlook: BECN now expects adjusted EBITDA results to be $840 million -$870 million, representing the upper half of its previously announced guidance range.
Last month, BECN reported Q1 2023 revenues of $1.73 billion, missing the consensus of $1.79 billion.
BECN plans to report Q2 2023 on August 3, 2023, after market close.
Also Read: Beacon Roofing’s Financial Health, M&A Potential And Expansion Initiatives Prompt Analyst’s Price Target Raise
Price Action: BECN shares are trading higher by 2.67% at $83.02 on the last check Friday.
