Shares of Builders FirstSource, Inc ( BLDR ).are trading higher on Thursday after reporting fourth-quarter earnings results.

The company reported fourth-quarter sales decline of 8% year-on-year to $3.82 billion, missing the analyst consensus estimate of $3.90 billion.

The decrease in sales was primarily driven by lower core organic sales and commodity deflation.

Core organic net sales decreased by 8.8%, driven by declines across end markets, Multi-Family by 29.1%, Single-Family by 6.8%, and Repair and Remodel/Other by 0.1%. 

Selling, general and administrative expenses decreased 4.6%. Gross profit fell 15.7%, while the margin contracted 300 basis points to 32.3%.

Operating income declined 38% to $304.1 million and the operating margin contracted 390 basis points to 7.9%.

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Adjusted EBITDA decreased 28.0% to $493.6 million and the margin contracted 360 basis points to 12.9%. Adjusted EPS of $2.31 beat the consensus estimate of $2.13.

Operating cash flow for the twelve months declined to $1.9 billion, and free cash flow was down to $1.5 billion. The company repurchased 2.0 million shares of its common stock in the fourth quarter at an average price of $168.65 per share for $345.2 million.

As of December 31, 2024, the company has approximately $500 million remaining in its $1 billion share repurchase authorization announced in August 2024.

Outlook: Builders FirstSource ( BLDR ) sees FY25 revenue of $16.5 billion- $17.5 billion against the estimate of $17.327 billion.

The company expects the gross profit margin to be 30% to 32%, Adjusted EBITDA of $1.9 billion – $2.3 billion and adjusted EBITDA margin of 11.5% – 13.0%.

Price Action: BLDR shares are trading higher by 1.74% at $142.27 at last check Thursday.

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