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Sep 30, 2024
Trex Q3 2024 Earnings Report
Trex's third quarter results exceeded expectations due to sustained consumer demand for premium products and effective cost management.
Key Takeaways
Trex Company reported net sales of $234 million for the third quarter of 2024, a decrease of 23% compared to the prior-year quarter. Net income was $41 million, or $0.37 per diluted share. The company reaffirmed its full-year sales guidance and expects to achieve the high end of its EBITDA guidance range.
Net sales reached $234 million.
Gross margin was 39.9%.
Net income amounted to $41 million, with diluted earnings per share at $0.37.
EBITDA was $68 million, resulting in an EBITDA margin of 29.1%.
Forward Guidance
Trex reaffirmed net sales guidance at the midpoint of $1.14 billion and expects EBITDA margin to reach the high end of its guidance at 30.5%.
Positive Outlook
- Expanded railing line expected to increase penetration of the railing market.
- Exclusive decking distributors will adopt exclusivity for Trex® railing.
- Cost-out programs are expected to continue to be successful.
- Underlying EBITDA margin in 2025, adjusted for one-time costs, is expected to exceed 31%.
- Trex is positioned to capture the greatest share of the industry’s growth opportunities.
Challenges Ahead
- Initial cost of transition to expanded railing line estimated at $5 million in 2025.
- One-time Arkansas start-up costs.
- Unspecified risks and uncertainties that could cause actual results to differ materially.
- Sensitivity of the business to general economic conditions.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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