Installed Building Products posts record quarterly revenue as profit margins narrow
Second-quarter growth from commercial work, acquisitions and other operations partly offset weaker residential installation sales.
Installed Building Products reported second-quarter net revenue of US$777.8 million, a 2.3% increase from a year earlier and a quarterly record, according to figures reported by Yahoo Finance. The result was accompanied by weaker profit and narrower margins.
Net income fell to US$64.9 million, or US$2.43 per diluted share, from US$69.0 million, or US$2.52, a year earlier. Adjusted EBITDA declined 2.3% to US$130.9 million, reducing its margin to 16.9% from 17.6%.
The company’s performance reflected a sharp split between its markets. Residential same-branch installation sales fell 6.1%, while commercial same-branch sales rose 10.4%. Installed Building Products said affordability pressures and weaker consumer confidence could continue to weigh on residential demand.
Other revenue increased 50.4% to US$67.1 million, and the company said it had acquired about US$59 million in annualised revenue year to date. The larger contribution from the lower-margin Other segment weighed on profitability as its share of revenue grew.
Installed Building Products held US$394.5 million in cash at quarter-end and repurchased about 365,000 shares during the quarter. Its board declared a quarterly dividend of US$0.39 per share, payable on 30 September.
