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Mar 31, 2023
Griffon Q2 2023 Earnings Report
Griffon's Q2 2023 financial results exceeded expectations, driven by strong performance in the Home and Building Products segment, while the Consumer and Professional Products segment faced challenges due to reduced consumer demand and elevated customer inventory levels.
Key Takeaways
Griffon Corporation reported a revenue decrease of 9% to $711.0 million compared to the prior year quarter. The company recorded a loss from continuing operations of $62.3 million, or $1.17 per share. Adjusted income from continuing operations was $66.9 million, or $1.21 per share, compared to $72.7 million, or $1.36 per share in the prior year quarter. Adjusted EBITDA from continuing operations for the second quarter was $136.9 million, a 2% decrease from the prior year quarter of $139.3 million. The company is raising full-year EBITDA guidance from $500 million to $525 million.
Revenue decreased by 9% to $711.0 million, with organic revenue declining by 12% when adjusting for the Hunter Fan Company.
The company reported a loss from continuing operations of $62.3 million, or $1.17 per share, impacted by charges related to impairment of intangible assets and an expansion of its global sourcing strategy.
Adjusted EBITDA from continuing operations decreased by 2% to $136.9 million.
Full-year EBITDA guidance raised from $500 million to $525 million.
Griffon
Griffon
Forward Guidance
The company now expects 2023 revenue of $2.7 billion and Adjusted EBITDA of at least $525 million, excluding unallocated costs of $56 million, and charges related to the strategic review process of $22 million and AMES’s global sourcing expansion.
Positive Outlook
- Increased Adjusted EBITDA expectations reflect strong HBP results.
- Raising full-year EBITDA guidance from $500 million to $525 million.
- Expect increased HBP revenue driven by commercial volume increases.
- Expect improved residential volume expectations.
- Capital expenditures of $50 million.
Challenges Ahead
- Expect 2023 revenue of $2.7 billion (prior $2.95 billion) reflecting decreased CPP revenue.
- Decreased CPP revenue, primarily driven by reduced consumer demand.
- Ongoing elevated levels of customer inventory.
- Interest expense of $103 million.
- A normalized tax rate of 29%.