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Sep 30, 2023
AZEK Q4 2023 Earnings Report
AZEK demonstrated strong financial performance in the fourth quarter, driven by residential sales and margin execution, significantly improved quarterly net profit margin, and delivered record adjusted EBITDA margin.
Key Takeaways
AZEK's Q4 2023 results showed strong growth, with net sales increasing by 27.6% year-over-year to $388.8 million and residential segment sales rising by 37.6%. Net income increased significantly to $42.6 million, and adjusted EBITDA reached $106.4 million, reflecting improved profitability and margin expansion.
Consolidated Net Sales increased 27.6% year-over-year to $388.8 million.
Residential Segment Net Sales increased 37.6% year-over-year to $349.6 million.
Net Income increased $47.4 million year-over-year to $42.6 million; Net profit margin expanded 1,260 basis points to 11.0%.
Adjusted EBITDA increased 63.4% year-over-year to $106.4 million; Adjusted EBITDA Margin expanded 600 basis points to 27.4%.
AZEK
AZEK
AZEK Revenue by Segment
Revenue by Segment
Residential Segment Revenue
CapyFin.comCommercial Segment Revenue
CapyFin.com Forward Guidance
AZEK anticipates continued growth in the residential segment, driven by material conversion and channel expansion, while acknowledging macroeconomic uncertainties. The company expects outperformance relative to market growth due to AZEK-specific initiatives.
Positive Outlook
- Positive Residential sell-through growth.
- Constructive demand indicators from customer surveys and digital metrics.
- Channel inventories are conservatively positioned.
- Proactively managing finished goods inventory levels to maintain high service levels.
- Expects to outperform the market driven by AZEK-specific initiatives.
Challenges Ahead
- Continued macroeconomic uncertainty may weigh on consumer confidence.
- Fiscal year 2024 planning assumptions assume flat-to-down low single-digits repair & remodel market growth.
- Uncertainty regarding, and the potential variability of, reconciling items such as the costs of acquisitions
- Such reconciling items that impact Adjusted EBITDA have not occurred, are outside of our control or cannot be reasonably predicted.
- Material changes to these reconciling items could have a significant effect on our Adjusted EBITDA guidance and future GAAP results.
Revenue & Expenses
Visualization of income flow from segment revenue to net income