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TopBuild Reports Fourth Quarter and Year-End 2023 Financial Results
ソース: Nasdaq GlobeNewswire / 28 2 2024 06:45:45 America/New_York
Fourth Quarter Highlights
- Sales increase 1.7% to $1.3 billion
- Gross margin expands 70 basis points to 30.4%
- Adjusted EBITDA margin expands 80 basis points to 19.6%
Full Year Highlights
- Sales increase 3.7% to $5.2 billion
- Gross margin expands 120 basis points to 30.9%
- Adjusted EBITDA margin expands 140 basis points to 20.2%
Provides 2024 Sales and Adjusted EBITDA Outlook
DAYTONA BEACH, Fla., Feb. 28, 2024 (GLOBE NEWSWIRE) -- TopBuild Corp. (NYSE:BLD), a leading installer and specialty distributor of insulation and related building material products to the construction industry in the United States and Canada today reported results for the fourth quarter and year ended December 31. 2023.
Robert Buck, President and Chief Executive Officer, stated, “Our fourth quarter results cap a year of continuous improvement and profitable growth. We are particularly pleased with the performance of our businesses that serve the commercial and industrial end markets, which grew 4.9% in the fourth quarter and 6.2% for the full year.”
Fourth Quarter Financial Highlights
(comparisons are to the quarter ended December 31, 2022)
3 Months Ended 12/31/23 Reported Change Sales $1,286,074 1.7% Gross Margin 30.4% 70 bps SG&A as % of revenue 14.5% 90 bps Operating Profit $204,800 0.8% Operating Margin 15.9% (20 bps) Net Income $146,382 1.8% Net Income per diluted share $4.60 1.8% 3 Months Ended 12/31/23 Adjusted Change Sales $1,286,074 1.7% Gross Margin 30.4% 70 bps SG&A as % of revenue 13.9% 40 bps Operating Profit $212,222 3.8% Operating Margin 16.5% 30 bps Net Income $149,305 6.6% Net Income per diluted share $4.69 6.6% EBITDA $251,641 6.0% EBITDA Margin 19.6% 80 bps Full Year 2023 Financial Highlights
(comparisons are to the twelve months ended December 31, 2022)12 Months Ended 12/31/23 Reported Change Sales $5,194,694 3.7% Gross Margin 30.9% 120 bps SG&A as % of revenue 14.0% 20 bps Operating Profit $878,825 10.2% Operating Margin 16.9% 100 bps Net Income $614,254 10.5% Net Income per diluted share $19.33 12.8% 12 Months Ended 12/31/23 Adjusted Change Sales $5,194,694 3.7% Gross Margin 30.9% 120 bps SG&A as % of revenue 13.5% (10 bps) Operating Profit $900,446 11.9% Operating Margin 17.3% 120 bps Net Income $626,857 13.0% Net Income per diluted share $19.73 15.3% EBITDA $1,049,160 11.5% EBITDA Margin 20.2% 140 bps “2023 was another year of consistent performance and solid execution for TopBuild, demonstrating the strength of our unique operating model and our ability to adapt to changing environments,” noted Buck. “Our unrelenting focus on driving operational efficiencies, striving for operational excellence, and improving sales and labor productivity contributed to our solid revenue growth and year-over-year margin expansion.”
Operating Segment Highlights ($ in 000s)
(comparisons are to the periods ended December 31, 2022)Installation 3 Months
Ended
12/31/2312 Months
Ended
12/31/23Specialty
Distribution3 Months
Ended
12/31/2312 Months
Ended
12/31/23Sales $790,414 $3,188,232 Sales $564,468 $2,268,339 Change Change Volume -3.0% 0.4% Volume -0.2% -1.6% Price 2.4% 3.6% Price 0.5% 1.1% M&A 5.1% 3.6% M&A 0.0% 0.0% Dispositions -0.7% -0.3% Dispositions 0.0% 0.0% Total Change 3.8% 7.3% Total Change 0.2% -0.4% Operating Margin 19.0% 20.2% Operating Margin 14.8% 14.6% Change 40 bps 170 bps Change 50 bps 30 bps Adj. Operating Margin 19.0% 20.3% Adj. Operating Margin 14.8% 14.6% Change 30 bps 180 bps Change 40 bps 20 bps Adj. EBITDA Margin 21.4% 22.5% Adj. EBITDA Margin 17.5% 17.3% Change 60 bps 190 bps Change 80 bps 40 bps Capital Allocation
2023 Acquisitions
The Company acquired four residential insulation installation companies which are expected to generate over $172 million in annual revenue. They are listed in the chart below.TTM Revenue at Month Company Acquired Acquisition ($ millions) Acquired SRI Holdings $62.0 January Best Insulation $100.0 July Rocky Mountain Spray Foam $5.4 July Panhandle Insulation $5.3 October Total $172.7 “Acquisitions remain the best use of our capital, generating strong returns for our shareholders. We continue to work diligently on our planned acquisition of SPI. All three of our end-markets are highly fragmented and present great opportunities to reinvest our strong free cash flow to drive shareholder value,” said Buck.
2024 Acquisitions
Year-to-date, the Company has acquired one residential insulation company, Brabble Insulation, and has entered into an agreement to acquire a second residential insulation installer, Morris Black & Sons, which will close on March 1st. Combined, they are expected to generate approximately $9 million of annual revenue. The Company also previously announced that it had entered into an agreement to acquire the assets of Pest Control Insulation, a specialty distribution company focused on blended, customized insulation products, accessories, and equipment for sale exclusively to the pest control industry. In 2023, Pest Control Insulation generated approximately $24 million of revenue. This transaction is also expected to close on March 1st.2024 Outlook
“We expect 2024 will be another strong year for TopBuild. We see many opportunities in the year ahead to again demonstrate the unique advantages of our operating model and to take advantage of our multiple avenues for growth,” added Buck.Sales and Adjusted EBITDA Guidance (1)
($ in millions)2024 Low High Sales $ 5,360 $ 5,560 Adjusted EBITDA* $ 1,040 $ 1,130 *See table for adjusted EBITDA reconciliation.
2024 Assumptions Residential Revenue Mid Single Digit Growth Commercial/Industrial Revenue Mid Single Digit Growth CapEx (% of Sales) 1.5% to 2.0% Working Capital Goal (% LTM Sales) 12% to 14% Income Tax Rate 25% to 27% Incremental Adjusted EBITDA (Organic) 22% to 27% Incremental Adjusted EBITDA (Acquisitions Year One) 11% to 16% (1) This outlook reflects management’s current view of present and future market conditions and are based on assumptions such as housing starts, general and administrative expenses, and interest rates. These targets do not include any effects related to potential acquisitions or divestitures that may occur after the date of this press release. A reconciliation of non-GAAP targets to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, the costs and expenses that may be incurred in the future and therefore, cannot be reasonably predicted. The effect of these excluded items may be significant. Factors that could cause actual long-term results to differ materially from TopBuild’s current expectations are discussed below and are also detailed in the Company’s most recent Annual Report on Form 10-K and subsequent SEC reports.
Conference Call
A conference call to discuss fourth quarter 2023 financial results is scheduled for today, Wednesday, February 28, at 9:00 a.m. Eastern Time. The call may be accessed by dialing (877) 407-9037. The conference call will be webcast simultaneously on the Company’s website at www.topbuild.com. In addition, a copy of management’s formal remarks and a presentation that summarizes management’s formal remarks will be available immediately prior to the conference call on www.topbuild.com.About TopBuild
TopBuild Corp., headquartered in Daytona Beach, Florida, is a leading installer and specialty distributor of insulation and related building material products to the construction industry in the United States and Canada. We provide insulation installation services nationwide through our Installation segment which has approximately 240 branches located across the United States. We distribute building and mechanical insulation, insulation accessories and other building product materials for the residential, commercial, and industrial end markets through our Specialty Distribution business. Our Specialty Distribution network encompasses approximately 170 branches. To learn more about TopBuild please visit our website at www.topbuild.com.Use of Non-GAAP Financial Measures
Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the “adjusted” financial measures presented above, and figures presented on a “same branch basis” are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. Additional information may be found in the Company’s filings with the Securities and Exchange Commission which are available on TopBuild’s website under “SEC Filings” at www.topbuild.com.
Safe Harbor Statement
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, our expected financial and operational results, the related assumptions underlying our expected results, and our plan to repurchase our common stock under stock repurchase transactions. These forward-looking statements can be identified by words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” “may,” “project,” “estimate” or “intend,” the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. Our forward-looking statements contained herein speak only as of the date of this press release. Factors or events that we cannot predict, including those described in the risk factors contained in our filings with the Securities and Exchange Commission, may cause our actual results to differ from those expressed in forward-looking statements. Although TopBuild believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved and it undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.
Investor Relations and Media Contact
Tabitha Zane
tabitha.zane@topbuild.com
386-763-8801(tables follow)
TopBuild Corp. Consolidated Statements of Operations (in thousands, except share and per common share amounts) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net sales $ 1,286,074 $ 1,264,543 $ 5,194,694 $ 5,008,744 Cost of sales 894,958 888,871 3,590,874 3,522,025 Gross profit 391,116 375,672 1,603,820 1,486,719 Selling, general, and administrative expense 186,316 172,558 724,995 689,555 Operating profit 204,800 203,114 878,825 797,164 Other income (expense), net: Interest expense (19,187 ) (16,779 ) (74,614 ) (56,716 ) Other, net 8,729 1,585 21,272 1,687 Other expense, net (10,458 ) (15,194 ) (53,342 ) (55,029 ) Income before income taxes 194,342 187,920 825,483 742,135 Income tax expense (47,960 ) (44,086 ) (211,229 ) (186,146 ) Net income $ 146,382 $ 143,834 $ 614,254 $ 555,989 Net income per common share: Basic $ 4.63 $ 4.54 $ 19.44 $ 17.26 Diluted $ 4.60 $ 4.52 $ 19.33 $ 17.14 Weighted average shares outstanding: Basic 31,623,506 31,648,741 31,597,508 32,213,839 Diluted 31,805,569 31,838,352 31,776,901 32,440,405 TopBuild Corp. Consolidated Statements of Comprehensive Income (in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net income $ 146,382 $ 143,834 $ 614,254 $ 555,989 Other comprehensive income (loss): Foreign currency translation adjustment 4,227 (6,762 ) 7,255 (15,286 ) Comprehensive income $ 150,609 $ 137,072 $ 621,509 $ 540,703 TopBuild Corp. Consolidated Balance Sheets and Other Financial Data (dollars in thousands) As of December 31, 2023 2022 ASSETS Current assets: Cash and cash equivalents $ 848,565 $ 240,069 Receivables, net of an allowance for credit losses of $23,948 at December 31, 2023, and $20,014 at December 31, 2022 799,009 836,071 Inventories 364,731 438,644 Prepaid expenses and other current assets 36,939 34,257 Total current assets 2,049,244 1,549,041 Right of use assets 204,629 205,892 Property and equipment, net 264,487 253,484 Goodwill 2,042,568 1,966,994 Other intangible assets, net 591,058 614,967 Other assets 10,865 16,453 Total assets $ 5,162,851 $ 4,606,831 LIABILITIES Current liabilities: Accounts payable $ 469,585 $ 487,114 Current portion of long-term debt 47,039 40,068 Accrued liabilities 187,217 199,370 Short-term operating lease liabilities 65,780 60,880 Short-term finance lease liabilities 1,917 2,207 Total current liabilities 771,538 789,639 Long-term debt 1,373,028 1,417,257 Deferred tax liabilities, net 243,930 251,481 Long-term portion of insurance reserves 58,783 59,783 Long-term operating lease liabilities 146,213 149,943 Long-term finance lease liabilities 4,150 6,673 Other liabilities 1,554 2,349 Total liabilities 2,599,196 2,677,125 EQUITY 2,563,655 1,929,706 Total liabilities and equity $ 5,162,851 $ 4,606,831 As of December 31, 2023 2022 Other Financial Data Receivable days 53 54 Inventory days 37 45 Accounts payable days 62 66 Receivables, net plus inventories less accounts payable $ 694,155 $ 787,601 Receivables, net plus inventories less accounts payable as a percent of sales (TTM) † 13.2 % 15.7 % † Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches TopBuild Corp. Consolidated Statement of Cash Flows (in thousands) Year Ended December 31, 2023 2022 Cash Flows Provided by (Used in) Operating Activities: Net income $ 614,254 $ 555,989 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 132,878 123,335 Share-based compensation 15,838 12,310 Loss on sale of assets 2,349 1,833 Amortization of debt issuance costs 2,881 2,867 Provision for bad debt expense 6,481 5,510 Provision for inventory obsolescence 4,794 6,659 Deferred income taxes, net (7,476 ) 6,041 Change in certain assets and liabilities: Receivables, net 20,812 (169,327 ) Inventories 74,529 (93,874 ) Prepaid expenses and other current assets (2,598 ) (9,222 ) Accounts payable (8,867 ) 26,581 Accrued liabilities (4,444 ) 20,703 Other, net (2,022 ) 6,396 Net cash provided by operating activities 849,409 495,801 Cash Flows Provided by (Used in) Investing Activities: Purchases of property and equipment (63,998 ) (76,382 ) Acquisition of businesses, net of cash acquired (149,154 ) (20,500 ) Proceeds from sale of assets 14,982 2,975 Net cash used in investing activities (198,170 ) (93,907 ) Cash Flows Provided by (Used in) Financing Activities: Repayment of long-term debt (40,138 ) (38,658 ) Proceeds from revolving credit facility — 70,000 Repayment of revolving credit facility — (70,000 ) Taxes withheld and paid on employees' equity awards (6,528 ) (11,719 ) Exercise of stock options 3,130 2,028 Repurchase of shares of common stock — (250,050 ) Payment of contingent consideration (300 ) (1,674 ) Net cash used in by financing activities (43,836 ) (300,073 ) Impact of exchange rate changes on cash 1,093 (1,531 ) Net increase in cash and cash equivalents 608,496 100,290 Cash and cash equivalents - Beginning of period 240,069 139,779 Cash and cash equivalents - End of period $ 848,565 $ 240,069 Supplemental disclosure of cash paid for: Interest $ 71,463 $ 49,888 Income taxes 220,773 186,722 Supplemental disclosure of noncash activities: Leased assets obtained in exchange for new operating lease liabilities $ 56,255 $ 103,997 Accruals for property and equipment 912 141 TopBuild Corp. Segment Data (Unaudited) (dollars in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 Change 2023 2022 Change Installation Sales $ 790,414 $ 761,261 3.8 % $ 3,188,232 $ 2,969,978 7.3 % Operating profit, as reported $ 149,999 $ 141,961 $ 644,392 $ 548,795 Operating margin, as reported 19.0 % 18.6 % 20.2 % 18.5 % Rationalization charges 41 161 1,923 (174 ) Acquisition related costs 11 23 527 135 Operating profit, as adjusted $ 150,051 $ 142,145 $ 646,842 $ 548,756 Operating margin, as adjusted 19.0 % 18.7 % 20.3 % 18.5 % Share-based compensation 372 339 1,496 1,296 Depreciation and amortization 18,422 15,869 69,123 62,483 EBITDA, as adjusted $ 168,845 $ 158,353 6.6 % $ 717,461 $ 612,535 17.1 % EBITDA margin, as adjusted 21.4 % 20.8 % 22.5 % 20.6 % Specialty Distribution Sales $ 564,468 $ 563,065 0.2 % $ 2,268,339 $ 2,278,261 (0.4 )% Operating profit, as reported $ 83,355 $ 80,692 $ 330,938 $ 326,226 Operating margin, as reported 14.8 % 14.3 % 14.6 % 14.3 % Acquisition related costs — 266 350 1,502 Operating profit, as adjusted $ 83,355 $ 80,958 $ 331,288 $ 327,728 Operating margin, as adjusted 14.8 % 14.4 % 14.6 % 14.4 % Share-based compensation 298 104 1,286 1,041 Depreciation and amortization 15,193 13,184 59,607 56,881 EBITDA, as adjusted $ 98,846 $ 94,246 4.9 % $ 392,181 $ 385,650 1.7 % EBITDA margin, as adjusted 17.5 % 16.7 % 17.3 % 16.9 % TopBuild Corp. Adjusted EBITDA (Unaudited) (dollars in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 Change 2023 2022 Change Total net sales Sales before eliminations $ 1,354,882 $ 1,324,326 $ 5,456,571 $ 5,248,239 Intercompany eliminations (68,808 ) (59,783 ) (261,877 ) (239,495 ) Net sales after eliminations $ 1,286,074 $ 1,264,543 1.7 % $ 5,194,694 $ 5,008,744 3.7 % Operating profit, as reported - segments $ 233,354 $ 222,653 $ 975,330 $ 875,021 General corporate expense, net (16,787 ) (9,650 ) (52,067 ) (38,018 ) Intercompany eliminations (11,767 ) (9,889 ) (44,438 ) (39,839 ) Operating profit, as reported $ 204,800 $ 203,114 $ 878,825 $ 797,164 Operating margin, as reported 15.9 % 16.1 % 16.9 % 15.9 % Rationalization charges 41 162 1,923 (172 ) Acquisition related costs † 7,381 1,216 19,698 7,974 Operating profit, as adjusted $ 212,222 $ 204,492 $ 900,446 $ 804,966 Operating margin, as adjusted 16.5 % 16.2 % 17.3 % 16.1 % Share-based compensation 4,757 2,637 15,836 12,310 Depreciation and amortization 34,662 30,284 132,878 123,335 EBITDA, as adjusted $ 251,641 $ 237,413 6.0 % $ 1,049,160 $ 940,611 11.5 % EBITDA margin, as adjusted 19.6 % 18.8 % 20.2 % 18.8 % Sales change period over period 21,531 185,950 EBITDA, as adjusted, change period over period 14,228 108,549 Incremental EBITDA, as adjusted, as a percentage of change in sales 66.1 % 58.4 % † Acquisition related costs include corporate level adjustments as well as segment operating adjustments TopBuild Corp. Same Branch and Acquisition Metrics (Unaudited) (dollars in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net sales Same branch: Installation $ 751,971 $ 756,330 $ 3,080,770 $ 2,960,926 Specialty Distribution 564,468 563,065 2,268,339 2,278,261 Eliminations (68,808 ) (59,783 ) (261,877 ) (239,495 ) Total same branch $ 1,247,631 $ 1,259,612 $ 5,087,232 $ 4,999,692 Acquisitions (a): Installation $ 38,443 $ — $ 107,462 $ — Total acquisitions 38,443 — 107,462 — Dispositions (b): Installation $ — $ 4,931 $ — $ 9,052 Total dispositions — 4,931 — 9,052 Total net sales $ 1,286,074 $ 1,264,543 $ 5,194,694 $ 5,008,744 EBITDA, as adjusted Same branch $ 246,769 $ 236,941 $ 1,033,980 $ 939,183 Acquisitions (a) 4,872 — 15,180 — Dispositions (b) — 472 — 1,428 Total $ 251,641 $ 237,413 $ 1,049,160 $ 940,611 EBITDA, as adjusted, as a percentage of sales Same branch (c) 19.8 % 20.3 % Acquisitions (d) 12.7 % 14.1 % Total (e) 19.6 % 18.8 % 20.2 % 18.8 % As Adjusted Incremental EBITDA, as a percentage of change in sales Same branch (f) NM 108.3 % Acquisitions (d) 12.7 % 14.1 % Total (g) 66.1 % 58.4 % (a) Represents current year impact of acquisitions in their first twelve months (b) Represents operating results in prior period previously classified as same branch, including $4,121 net sales and $956 EBITDA, as adjusted, in the third quarter of 2022, respectively (c) Same branch metric, as adjusted, as a percentage of same branch sales (d) Acquired metric, as adjusted, as a percentage of acquired sales (e) Total EBITDA, as adjusted, as a percentage of total sales (f) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales (g) Change in total EBITDA, as adjusted, as a percentage of change in total sales NM Not Meaningful TopBuild Corp. Non-GAAP Reconciliations (Unaudited) (in thousands, except share and per common share amounts) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Gross Profit Reconciliation Net sales $ 1,286,074 $ 1,264,543 $ 5,194,694 $ 5,008,744 Gross profit, as reported $ 391,116 $ 375,672 $ 1,603,820 $ 1,486,719 Acquisition related costs — 15 — 135 Gross profit, as adjusted $ 391,116 $ 375,687 $ 1,603,820 $ 1,486,854 Gross margin, as reported 30.4 % 29.7 % 30.9 % 29.7 % Gross margin, as adjusted 30.4 % 29.7 % 30.9 % 29.7 % Selling, General and Administrative Expense Reconciliation Selling, general, and administrative expense, as reported $ 186,316 $ 172,558 $ 724,995 $ 689,555 Rationalization charges 41 162 1,923 (172 ) Acquisition related costs 7,381 1,201 19,698 7,839 Selling, general, and administrative expense, as adjusted $ 178,894 $ 171,195 $ 703,374 $ 681,888 Operating Profit Reconciliation Operating profit, as reported $ 204,800 $ 203,114 $ 878,825 $ 797,164 Rationalization charges 41 162 1,923 (172 ) Acquisition related costs 7,381 1,216 19,698 7,974 Operating profit, as adjusted $ 212,222 $ 204,492 $ 900,446 $ 804,966 Operating margin, as reported 15.9 % 16.1 % 16.9 % 15.9 % Operating margin, as adjusted 16.5 % 16.2 % 17.3 % 16.1 % Income Per Common Share Reconciliation Income before income taxes, as reported $ 194,342 $ 187,920 $ 825,483 $ 742,135 Rationalization charges 41 162 1,923 (172 ) Acquisition related costs 7,381 1,216 19,698 7,974 Income before income taxes, as adjusted 201,764 189,298 847,104 749,937 Tax rate at 26.0% (52,459 ) (49,217 ) (220,247 ) (194,984 ) Income, as adjusted $ 149,305 $ 140,081 $ 626,857 $ 554,953 Income per common share, as adjusted $ 4.69 $ 4.40 $ 19.73 $ 17.11 Weighted average diluted common shares outstanding 31,805,569 31,838,352 31,776,901 32,440,405 TopBuild Corp. Reconciliation of Adjusted EBITDA to Net Income (Unaudited) (in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net income, as reported $ 146,382 $ 143,834 $ 614,254 $ 555,989 Adjustments to arrive at EBITDA, as adjusted: Interest expense and other, net 10,458 15,194 53,342 55,029 Income tax expense 47,960 44,086 211,229 186,146 Depreciation and amortization 34,662 30,284 132,878 123,335 Share-based compensation 4,757 2,637 15,836 12,310 Rationalization charges 41 162 1,923 (172 ) Acquisition related costs 7,381 1,216 19,698 7,974 EBITDA, as adjusted $ 251,641 $ 237,413 $ 1,049,160 $ 940,611 Proforma acquisition EBITDA(a) $ 6,251 Proforma disposition EBITDA(b) (3,040 ) Proforma TTM EBITDA, as adjusted $ 1,052,371 (a) Represents the trailing twelve months proforma impact of acquisitions completed in 2023 (b) Represents the trailing twelve months proforma impact of dispositions completed in 2023 TopBuild Corp. Acquisition Adjusted Net Sales (Unaudited) (in thousands) 2023 Year Ended Q1 Q2 Q3 Q4 December 31, 2023 Net sales $ 1,265,238 $ 1,317,262 $ 1,326,120 $ 1,286,074 $ 5,194,694 Acquisitions proforma adjustment † 31,847 26,978 5,400 55 64,280 Net sales, acquisition adjusted $ 1,297,085 $ 1,344,240 $ 1,331,520 $ 1,286,129 $ 5,258,974 † Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches TopBuild Corp. Net Sales by Market (Unaudited) (in thousands) Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Residential $ 830,915 $ 830,789 $ 3,350,003 $ 3,272,001 Commercial/Industrial 455,159 433,754 1,844,691 1,736,743 Total net sales $ 1,286,074 $ 1,264,543 $ 5,194,694 $ 5,008,744 TopBuild Corp. 2024 Estimated Adjusted EBITDA Range (Unaudited) (in millions) Twelve Months Ending December 31, 2024 Low High Estimated net income, as reported $ 588.0 $ 667.0 Adjustments to arrive at estimated EBITDA, as adjusted: Interest expense and other, net 60.0 54.0 Income tax expense 206.0 234.0 Depreciation and amortization 140.0 135.0 Share-based compensation 21.0 18.0 Acquisition related costs 25.0 22.0 Estimated EBITDA, as adjusted $ 1,040.0 $ 1,130.0 
