In This Article:
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Net Sales: $234 million in Q3 2024, a decrease of 23% from $304 million in Q3 2023.
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Gross Margin: 39.9%, down 190 basis points from 41.8% in the prior year period.
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Net Income: $41 million in Q3 2024, a decrease of 38% from $65 million in Q3 2023.
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Earnings Per Share (EPS): $0.37 per diluted share, down from $0.60 per diluted share in Q3 2023.
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EBITDA: $68 million or 29.1% of net sales, down 32% from $99 million or 32.7% of net sales in Q3 2023.
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Year-to-Date Net Sales: $984 million, a 9% increase from $899 million in the first nine months of 2023.
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Year-to-Date Net Income: $217 million or $1.99 per diluted share, compared to $183 million or $1.69 per diluted share in the first nine months of 2023.
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Year-to-Date EBITDA: $331 million, up 16% from $285 million in the prior year, with an EBITDA margin of 33.7%.
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Operating Cash Flow: $152 million year-to-date, compared to $288 million in 2023.
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Capital Expenditures: $152 million year-to-date, primarily for the Arkansas facility, with a total expected CapEx of $550 million.
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Share Repurchase: Over $100 million returned to shareholders through the repurchase of 1.6 million shares.
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Full Year Net Sales Guidance: Midpoint of $1.14 billion.
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Full Year EBITDA Margin Guidance: Expected to reach the high end of 30.5%.
Release Date: October 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Trex Co Inc (NYSE:TREX) surpassed third-quarter expectations due to strong consumer demand for premium products.
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The company maintained gross margins close to last year's levels, aided by continuous cost reduction programs.
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New product development is a strategic priority, with products launched in the last 36 months accounting for 18% of year-to-date net sales.
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Trex Co Inc (NYSE:TREX) plans to double its share of the residential railing market from 6% to 12% over the next five years.
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The Arkansas facility development is on track, with recycled plastic processing set to begin in early 2025, enhancing cost efficiency.
Negative Points
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Net sales decreased by 23% in the third quarter compared to the previous year, primarily due to a $70 million reduction in channel inventory.
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Gross margin decreased by 190 basis points due to lower utilization rates.
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The company anticipates a further $20 million to $30 million reduction in channel inventory in the fourth quarter.
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Trex Co Inc (NYSE:TREX) is experiencing restrained consumer spending on lower-priced products.
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Operating cash flow decreased significantly year-to-date, primarily due to increased inventories and capital expenditures.