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AZEK
🇺🇸 NYSE:AZEK
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Jun 30, 2024

AZEK Q3 2024 Earnings Report

AZEK's Q3 2024 financial results were announced, highlighting above-market growth in the Residential segment, strong net profit margin, and record adjusted EBITDA margin driven by key initiatives.

Key Takeaways

AZEK reported a 12% increase in consolidated net sales to $434.4 million and a 45% increase in net income to $50.1 million. The Residential segment saw an 18% increase in net sales. The company reaffirmed its second-half fiscal 2024 outlook and raised the bottom end of its full-year fiscal 2024 outlook.

Consolidated Net Sales increased 12% year-over-year to $434.4 million; Adjusted Net Sales excluding results for Vycom increased 18% year-over-year.

Residential Segment Net Sales increased 18% year-over-year to $416.0 million.

Net Income increased 45% year-over-year to $50.1 million; Adjusted Net Income increased 38% year-over-year to $62.0 million.

Adjusted EBITDA increased 24% year-over-year to $119.4 million; Residential Segment Adjusted EBITDA increased 33% year-over-year to $117.0 million.

Total Revenue
$434M
Previous year: $388M
+12.1%
EPS
$0.42
Previous year: $0.3
+40.0%
Adjusted EBITDA Margin
27.5%
Previous year: 25%
+10.0%
Gross Profit
$164M
Previous year: $132M
+24.3%
Cash and Equivalents
$347M
Previous year: $245M
+41.8%
Free Cash Flow
$178M
Previous year: $160M
+10.9%
Total Assets
$2.34B
Previous year: $2.35B
-0.2%

AZEK

AZEK

AZEK Revenue by Segment

Forward Guidance

AZEK is reaffirming its outlook for the second half of fiscal 2024 and raising the bottom end of its full-year fiscal 2024 guidance. Consolidated net sales are now expected in the range of $1.422 to $1.438 billion, and Adjusted EBITDA is expected in the range of $370 to $380 million.

Positive Outlook

  • Residential segment net sales are expected to grow approximately 10% to 12% year-over-year.
  • The company anticipates continued outperformance relative to softer trends in the broader repair & remodel markets.
  • Strong internal digital and engagement metrics suggest pent-up demand.
  • Believes well positioned to win across any market scenario
  • Sees substantial opportunities for material conversion to their types of low-maintenance, long-lasting materials.

Challenges Ahead

  • Residential sell-through growth is expected to be in the mid-single-digits in the fiscal fourth quarter.
  • The company is assuming a down market for the remainder of fiscal year 2024.
  • Channel partners are expected to end the fiscal year at or below historical inventory days on hand.
  • Fiscal fourth quarter net sales will be impacted by approximately $35 million due to the timing of purchases in the prior quarter
  • Some choppiness in the broader construction economy

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

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