Jeld-Wen Holding Inc. announced results for the three and nine months ended Sept. 30, 2023. The company is raising its full-year guidance for continuing operations to reflect its solid third quarter results.
Highlights
- Net revenues from continuing operations of $1,077.0 million decreased (5.5%) in the third quarter driven by a (7%) decline in core revenue.
- Net income from continuing operations was $16.9 million or $0.20 per share, compared to a net loss from continuing operations of ($45.1) million or ($0.53) per share during the same quarter a year ago.
- Adjusted EBITDA from continuing operations was $105.7 million, compared to $94.5 million during the same quarter a year ago.
- In July, the company completed the sale of its Australasia segment for approximately $446 million in net proceeds and recognized an after-tax gain on sale of $26.1 million.
Third-quarter 2023 results
Net revenue for the three months ended Sept. 30, 2023, decreased ($63.0) million, or (5.5%), to $1,077.0 million, compared to $1,140.0 million for the same period last year. The decrease in net revenue was driven by a (7%) core revenue decline composed of lower volume/mix (10%) partially offset by higher price realization of 3%.
Net income from continuing operations was $16.9 million in the third quarter, compared to a ($45.1) million net loss in the same period last year, an increase of $62.0 million. The increase was driven by a non-recurring goodwill impairment in the prior year period and higher operating income. Adjusted net income from continuing operations for the third quarter increased $13.8 million, to $45.6 million, compared to $31.8 million in the same period last year.
Earnings per share, or EPS, for the third quarter was $0.20, compared to ($0.53) for the same quarter last year. Adjusted EPS from continuing operations for the third quarter was $0.53 compared to adjusted EPS of $0.37 in the same quarter last year.
Adjusted EBITDA from continuing operations increased $11.2 million, to $105.7 million, compared to the same quarter last year. Adjusted EBITDA Margin from continuing operations increased 150 basis points to 9.8%, as positive price/cost and productivity improvements were partially offset by lower volume/mix.
Cash flow
Net cash flow provided by operations was $273.0 million during the first nine months of 2023, a $346.4 million improvement compared to net cash flow used in operations of ($73.4) million during the same period a year ago. The primary driver to the increased operating cash flow was a $374.7 million improvement in cash flow from working capital. Net working capital generated $55.0 million of cash flow in the first nine months of 2023 compared to a use of cash of ($319.7) million in the prior year period.
Updated full-year 2023 guidance
Jeld-Wen is raising its guidance to reflect the solid third quarter performance. The company now expects 2023 net revenue of $4.25 to $4.35 billion, which reflects a low double-digit decline in volume/mix across its portfolio of products and geographies in North America and Europe. Core Revenues are forecasted to be down 4% to 6% as price realization partially offsets lower market demand.
Jeld-Wen's response
"In the third quarter, our team continued to take actions to strengthen the foundation of our business, which generated year-over-year increased profitability and strong cash flows, despite challenging macroeconomic conditions," says CEO William J. Christensen. "We are taking the next steps to continue improving and sustaining our performance to unlock significant value for Jeld-Wen shareholders."
"In the fourth quarter of 2023, we anticipate that the current uncertain operating environment will continue but expect to mitigate the impact from weaker demand with benefits from our ongoing cost reductions. As our third quarter results were above our expectations, we are raising the midpoint of our 2023 adjusted EBITDA guidance."
