Installed Building Products, Inc.

Greetings and welcome to Install Building Products Fiscal 2024 Second Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Darren Hicks, Vice President of Investor Relations. Please go ahead.

Good morning, and welcome to Install Billing Products' second quarter 2024 earnings conference call. Earlier today, we issued a press release on our financial results for the second quarter, which can be found in the investor relations section of our website. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are based on management's current expectations and beliefs. These statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those described today. Please refer to the cautionary statements and risk factors in our SEC filings, including our annual report on Form 10-K. We undertake no duty or obligation to update any forward-looking statement as a result of new information or future events, except as required by federal securities laws. In addition, management refers to certain non-GAAP and adjusted financial measures on this call. You can find a reconciliation of such measures to the nearest GAAP equivalent in the company's earnings release and additional reconciliation for EBITDA and adjusted EBITDA for earlier fiscal years in our investor presentation, which are available on our investor relations section of our website. This morning's conference call is hosted by Jeff Edwards, our Chairman and Chief Executive Officer, and Michael Miller, our Chief Financial Officer, and joined by Jason Neiswanger, our Chief Administrative and Sustainability Officer. I will now turn the call over to Jeff. Thanks, Darren.

Good morning to everyone joining us on today's call. As usual, I will start the call with some highlights and then turn the call over to Michael, who will discuss our financial results and capital position in more detail before we take your questions. During the second quarter, we began the process of winding down the operations of a single branch that installed non-core building products into newly constructed commercial structures. We believe that excluding the financial results of this branch from our typical income statement metrics is useful in understanding and evaluating the results of our ongoing operations, as it is non-core. As such, all income statement figures mentioned on this call exclude the aforementioned branch results and are thus net of dispositions. Our second quarter sales results continue to reflect fundamental improvements in our single-family end market relative to the last 12 months and good sales growth in our multifamily end market. We believe our customers are committed to meeting new construction homeownership demand by continuing to build new single-family homes in the current macroeconomic backdrop. We expect our multifamily backlog to keep branches in core geographic markets busy in the near term despite ongoing industry headwinds. as it relates to multifamily unit starts. Longer term, we believe opportunities in our multifamily end markets remain attractive. I'm encouraged by the positive same branch sales growth we achieved in our single family end market. The nearly 8% year over year increase during the quarter was the strongest increase in same branch sales since the fourth quarter of 2022. single family sales growth was supported by a growing proportion of sales from national production builders in the quarter. Our deep customer relationships, local market knowledge, and ability to align our pricing with the value we offer our customers were key to our second quarter single family sales results. Our multi-family installation sales growth continued to be resilient with the apparent operational benefits of our centralized service-oriented model. On a same branch basis, Multifamily sales in our installation segment increased 5%. In addition, across our branches, there continues to be an opportunity to sell IBP's installation services in our markets that historically have not served multifamily customers. The sales growth results for our commercial installation segment reflects different dynamics in the two sub-markets that make up our commercial end market. The heavy commercial market continues to experience healthy sales growth, while our light commercial market continues to experience some headwinds as the light commercial construction cycle tends to lag single-family construction activity. Excluding dispositions, commercial sales growth was modestly positive in the quarter. Strong profitability during the second quarter continued to reflect our strategic priority to apply our local market expertise to efficiently complete the most operationally and financially attractive jobs for our local businesses. As a result, our second quarter adjusted EBITDA margin expanded to 18.5%. Acquisitions continue to be our top priority as we consider all of our options for capital allocation. Despite our growth over the years, we believe in meaningful opportunities still exist for us to expand our geographic presence and diversify the mix of building products we install across our national branch network. During the 2024 second quarter and in July, we completed the following acquisitions. a North Carolina-based installer of insulation and other diversified building products serving single-family and multifamily customers with annual revenue over $6 million, an Oklahoma-based installer of insulation and a Massachusetts-based installer of gutters with combined annual revenue of approximately $14 million, and an Illinois-based installer of a diversified set of building products with annual revenue of approximately $20 million. To date, we have acquired over $50 million of annual revenue, and we expect 2024 to be another favorable year of acquisition growth. We believe we are well positioned for another year of strong operational and financial performance in 2024 as we continue to focus on profitability and effective capital allocation to drive earnings growth and value for our shareholders. Based on the U.S. Census Bureau, single-family starts year-to-date through June 2024 have increased by 16%. We believe the current pace of STARTS growth supports a healthy market environment for our single-family installation services. Additionally, beyond the typical demand drivers, we believe the United States government incentives and planned mandates towards more stringent energy efficiency standards in new and existing single-family homes will be favorable for our business. We intend to continue to focus on what we can control, leveraging our strong customer relationships, experienced leadership team, national scale, and diverse product categories across multiple end markets to help the company navigate through any future changes in the U.S. construction market. I'm proud of our team's continued success, commitment to excellence, and ability to consistently meet the needs of our customers. To everyone at IVP, thank you for your commitment, your hard work, and a tough job always done well. I remain excited by the prospects ahead for IVP and the broader installation and other product installation business. So with this review, I'd like to turn the call over to Michael to provide more detail on our second quarter financial results.