0001558370-21-001405.txt : 20210223 0001558370-21-001405.hdr.sgml : 20210223 20210223065447 ACCESSION NUMBER: 0001558370-21-001405 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 20210223 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20210223 DATE AS OF CHANGE: 20210223 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TopBuild Corp CENTRAL INDEX KEY: 0001633931 STANDARD INDUSTRIAL CLASSIFICATION: CONSTRUCTION SPECIAL TRADE CONTRACTORS [1700] IRS NUMBER: 473096382 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-36870 FILM NUMBER: 21663008 BUSINESS ADDRESS: STREET 1: 475 N. WILLIAMSON BLVD. CITY: DAYTONA BEACH STATE: FL ZIP: 32114 BUSINESS PHONE: (386) 304-2200 MAIL ADDRESS: STREET 1: 475 N. WILLIAMSON BLVD. CITY: DAYTONA BEACH STATE: FL ZIP: 32114 FORMER COMPANY: FORMER CONFORMED NAME: Masco SpinCo Corp. DATE OF NAME CHANGE: 20150213 8-K 1 bld-20210223x8k.htm 8-K
0001633931false00016339312021-02-232021-02-23

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): February 23, 2021

TopBuild Corp.

(Exact name of registrant as specified in its charter)

Delaware

001-36870

47-3096382

(State or other Jurisdiction of

(Commission

(IRS Employer

Incorporation)

File Number)

Identification No.)

475 North Williamson Boulevard

Daytona Beach, Florida

32114

(Address of Principal Executive Offices)

(Zip Code)

Registrant’s telephone number, including area code: (386) 304-2200

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

BLD

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 2.02.  Results of Operations and Financial Condition.

On February 23, 2021, TopBuild Corp., a Delaware corporation (the “Company”), issued a press release announcing its financial results for the quarter and year ended December 31, 2020 (the “Press Release”).  The Press Release, which is furnished as Exhibit 99.1, and the information included in Item 7.01 of this Current Report on Form 8-K (this “Report”) are incorporated by reference in this Item 2.02.

The information in the Press Release and in this Item 2.02 is “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section.  Such information shall not be incorporated by reference in another filing under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), except to the extent such other filing specifically incorporates such information by reference.

Item 7.01.  Regulation FD Disclosure.

On February 23, 2021, the Company issued the Press Release.  The Press Release, which is furnished as Exhibit 99.1, and the information included in Item 2.02 of this Report are incorporated by reference in this Item 7.01.

The information in the Press Release and in this Item 7.01 is “furnished” and not “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section.  Such information shall not be incorporated by reference in another filing under the Exchange Act or the Securities Act except to the extent such other filing specifically incorporates such information by reference.

Item 9.01.  Financial Statements and Exhibits.

(d)  Exhibits

Exhibit
Number

    

Description

99.1 

Press release issued by TopBuild Corp., dated February 23, 2021, announcing its financial results for the quarter and year ended December 31, 2020.

104

Cover Page Interactive Data File (formatted as Inline XBRL)

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

TOPBUILD CORP.

By:

/s/ John S. Peterson

 

 

Name:

John S. Peterson

 

 

Title:

Vice President and Chief Financial Officer

Dated: February 23, 2021

 

 

3

EX-99.1 2 bld-20210223xex99d1.htm EX-99.1

Exhibit 99.1

Graphic

NYSE: BLD

A leading installer and distributor of insulation and building material products to the U.S. construction industry

TopBuild Reports Fourth Quarter and Full Year 2020 Results


4Q Highlights

Net sales increase 8.9%
Gross margin expands 150 basis points
14.3% operating margin, 14.4% on an adjusted basis, up 280 basis points
Adjusted EBITDA margin expands 280 basis points to 16.8%
$2.13 net income per diluted share, $2.15 on an adjusted basis

Provides 2021 Sales and Adjusted EBITDA Guidance


Fourth Quarter Financial Highlights

(unless otherwise indicated, comparisons are to the quarter ended December 31, 2019)

   

Gross margin increased 110 basis points to 27.6%.  On an adjusted basis, gross margin increased 130 basis points to 27.8%

   Operating profit was $80.5 million, compared to operating profit of $76.0 million.  On an adjusted basis, operating profit was $83.5 million, compared to $76.4 million, a 9.3% improvement.

   Net income was $55.5 million, or $1.67 per diluted share, compared to $52.1 million, or $1.51 per diluted share. Adjusted income was $55.7 million, or $1.68 per diluted share, compared to $49.5 million, or $1.43 per diluted share.

   

Net sales increased 8.9% to $721.5 million, driven by increased volume and sales from acquisitions.

   Gross margin expanded 150 basis points to 27.4%.  On an adjusted basis, gross margin was 27.5%, a 160-basis point increase.  

   Operating profit was $103.1 million, compared to $76.4 million.  On an adjusted basis, operating profit was $104.0 million, compared to $76.6 million, a 35.7% improvement.

   Operating margin was 14.3%.  Adjusted operating margin improved 280 basis points to 14.4%.

   Net income was $70.8 million, or $2.13 per diluted share, compared to $46.0 million, or $1.36 per diluted share.

“Our fourth quarter results were strong with operating margins expanding over 200 basis points at both TruTeam and Service Partners. Same branch residential and commercial revenue improved sequentially from the third quarter and continues to strengthen.

“Labor shortages and material constraints are extending the building cycle and the traditional lag time in our business. Our ability to share labor and material across our footprint gives us an advantage in serving our customers and helps us mitigate these challenges.”

ROBERT BUCK, PRESIDENT & CEO, TOPBUILD

   

Adjusted net income was $71.3 million, or $2.15 per diluted share, compared to $50.0 million, or $1.48 per diluted share.  

NYSE:BLD

February 23, 2021

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Adjusted EBITDA was $121.5 million, compared to $92.5 million, a 31.2% increase and adjusted EBITDA margin improved 280 basis points to 16.8%.  Incremental adjusted EBITDA margin was 48.9%.  

   

At December 31, 2020, the Company had cash and cash equivalents of $330.0 million, availability under its revolving credit facility of $389.6 million for total liquidity of $719.6 million.

Full Year 2020 Financial Highlights

(unless otherwise indicated, comparisons are to twelve months ended December 31, 2019)

   

Gross margin increased 110 basis points to 27.6%.  On an adjusted basis, gross margin increased 130 basis points to 27.8%

   Operating profit was $80.5 million, compared to operating profit of $76.0 million.  On an adjusted basis, operating profit was $83.5 million, compared to $76.4 million, a 9.3% improvement.

   Net income was $55.5 million, or $1.67 per diluted share, compared to $52.1 million, or $1.51 per diluted share. Adjusted income was $55.7 million, or $1.68 per diluted share, compared to $49.5 million, or $1.43 per diluted share.

   

Net sales increased 3.6% to $2,718.0 million.

   Gross margin expanded 150 basis points to 27.5%.

   Operating profit was $355.0 million, compared to operating profit of $289.5 million.  On an adjusted basis, operating profit was $359.4 million, compared to $292.7 million, a 22.8% improvement.

   Operating margin was 13.1%, up 210 basis points.  Adjusted operating margin improved 200 basis points to 13.2%.  

   Net income was $247.0 million, or $7.42 per diluted share, compared to $191.0 million, or $5.56 per diluted share.  Adjusted net income was $242.5 million, or $7.28 per diluted share, compared to $188.9 million, or $5.49 per diluted share.  

   Adjusted EBITDA was $436.7 million, compared to $359.1 million, a 21.6% increase and adjusted EBITDA margin improved 240 basis points to 16.1%.  

“Our 2020 financial results demonstrate the strength of our operating model and the hard work and dedication of our entire TopBuild team. Despite the challenges resulting from the pandemic, both of our business segments reported revenue growth and solid margin expansion.

“In addition, during the year we completed three acquisitions, strengthening our footprint in the high growth markets of Texas, Colorado and Tennessee.

“Looking ahead, housing fundamentals remain robust and our Company should continue to benefit from strong demand for new housing construction. Our focus remains on driving top line growth and improving operational efficiencies throughout the Company.”

ROBERT BUCK, PRESIDENT & CEO, TOPBUILD

NYSE:BLD

February 23, 2021

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Operating Segment Highlights ($ in 000s)

(comparisons are to the period ended December 31, 2019)

 Logo

Description automatically generated

3 Months Ended 12/31/20

12 Months Ended 12/31/20

A picture containing text, sign, clipart

Description automatically generated

 

3 Months Ended 12/31/20

12 Months Ended 12/31/20

Sales

$508,812

$1,943,461

Sales

$251,535

$926,207

Change

 

 

Change

 

 

Volume

2.8%

-1.0%

Volume

13.3%

7.9%

Price

-0.3%

0.9%

Price

-0.6%

-0.5%

M&A

4.5%

2.0%

M&A

0.0%

0.0%

Total Change

6.9%

1.9%

Total Change

12.7%

7.4%

Operating Margin

16.0%

15.2%

Operating Margin

13.4%

12.5%

Change

260 bps

190 bps

Change

210 bps

200 bps

Adj. Operating Margin

16.1%

15.3%

Adj. Operating Margin

13.4%

12.5%

Change

270 bps

200 bps

Change

210 bps

200 bps

Capital Allocation

Acquisitions

   

Gross margin increased 110 basis points to 27.6%.  On an adjusted basis, gross margin increased 130 basis points to 27.8%

   Operating profit was $80.5 million, compared to operating profit of $76.0 million.  On an adjusted basis, operating profit was $83.5 million, compared to $76.4 million, a 9.3% improvement.

   Net income was $55.5 million, or $1.67 per diluted share, compared to $52.1 million, or $1.51 per diluted share. Adjusted income was $55.7 million, or $1.68 per diluted share, compared to $49.5 million, or $1.43 per diluted share.

In 2020, the Company completed three acquisitions, Hunter Insulation, an installation company based in Long Island, New York, Cooper Glass a commercial glass company serving the Memphis market, and Garland Insulating, a residential and light commercial installation company serving markets in Texas and Colorado.  

In January 2021, the Company acquired LCR Contractors, a residential and heavy commercial insulation company serving markets in Texas and Tennessee.  Combined, these four companies are expected to contribute approximately $137 million of annual revenue.  

“Acquisitions remain our number one capital allocation priority. We have a robust pipeline of prospects with the majority concentrated in our core insulation business. These companies are located in attractive growth regions with strong management teams, solid customer bases and experienced installers.”

ROBERT BUCK, PRESIDENT & CEO, TOPBUILD

Share Repurchase Program

In 2020, the Company repurchased a total of 616,227 shares of its common stock for approximately $49.2 million.  

Sales and Adjusted EBITDA Guidance (1)

($ in millions)

2021

Low

High

Sales

$ 3,050.0

$ 3,150.0

Adjusted EBITDA*

$ 505.0

$ 535.0

*See table for adjusted EBITDA reconciliation.

NYSE:BLD

February 23, 2021

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Assumptions(1)

($ in millions)

2021

Low

High

Housing Starts

1,425

1,475

Estimated net income

$ 297.5

$ 326.7

Interest Expense and other, net

$ 24.2

$ 21.2

Income tax expense

$ 104.5

$ 114.8

Depreciation and Amortization

$ 67.0

$ 63.0

Share based compensation

$ 11.8

$ 9.3

Long-Term Targets (3-Years)(1)

Metric

 

Working Capital (% of LTM Sales)

9.5% to 10.5%

CapEx (% of Sales)

2.0%

Commercial Annual Revenue Growth

7.5% to 10.0%

Normalized Tax Rate

26.0%

Incremental Adjusted EBITDA (Organic)

22.0% to 27.0%

Incremental Adjusted EBITDA (Acquisitions Year One)

11.0% to 16.0%

Residential Revenue for Every 50K Increase in Housing Starts

$90 million

(1) This guidance and long-term targets reflect management’s current view of present and future market conditions and are based on assumptions such as housing starts, general and administrative expenses, weighted average diluted shares outstanding and interest rates.  These targets do not include any effects related to potential acquisitions or divestitures that may occur after the date of this press release.  A reconciliation of non-GAAP targets to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, the costs and expenses that may be incurred in the future and therefore, cannot be reasonably predicted. The effect of these excluded items may be significant.  Factors that could cause actual long-term results to differ materially from TopBuild’s current expectations are discussed below and are also detailed in the Company’s 2020 Annual Report on Form 10-K and subsequent SEC reports.  

Additional Information

Quarterly supplemental materials, including a presentation that will be referenced on today’s conference call, are available on the Company’s website at www.topbuild.com.

Conference Call

A conference call to discuss fourth quarter 2020 financial results is scheduled for today, Tuesday, February 23, at 9:00 a.m. Eastern Time.  The call may be accessed by dialing (877) 407-9037.  The conference call will be webcast simultaneously on the Company’s website at www.topbuild.com.  

NYSE:BLD

February 23, 2021

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About TopBuild

TopBuild Corp., a Fortune 1000 Company headquartered in Daytona Beach, Florida, is a leading installer and distributor of insulation and building material products to the U.S. construction industry. We provide insulation and building material services nationwide through TruTeam®, which has close to 200 branches, and through Service Partners® which distributes insulation and building material products from approximately 75 branches.  We leverage our national footprint to gain economies of scale while capitalizing on our local market presence to forge strong relationships with our customers.  To learn more about TopBuild please visit our website at www.topbuild.com

Use of Non-GAAP Financial Measures

Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the “adjusted” financial measures presented above, and figures presented on a “same branch basis” are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”).  The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months.  Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release.  Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP.  Additional information may be found in the Company’s filings with the Securities and Exchange Commission which are available on TopBuild’s website under “SEC Filings” at www.topbuild.com.

Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act.  These forward-looking statements may address, among other things, our expected financial and operational results, the related assumptions underlying our expected results, and our plan to repurchase our common stock under a stock repurchase transaction.  These forward-looking statements are distinguished by use of words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms, and similar references to future periods.  These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements.  Our forward-looking statements contained herein speak only as of the date of this press release.  Factors or events that we cannot predict, including those described in the risk factors contained in our filings with the Securities and Exchange Commission, may cause our actual results to differ from those expressed in forward-looking statements.  Although TopBuild believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved and it undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

Investor Relations and Media Contact

Tabitha Zane

tabitha.zane@topbuild.com

386-763-8801

(tables follow)

NYSE:BLD

February 23, 2021

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TopBuild Corp.

Consolidated Statements of Operations

(in thousands, except share and per common share amounts)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

2020

2019

Net sales

$

721,487

    

$

662,349

    

$

2,718,038

    

$

2,624,121

Cost of sales

523,467

491,030

1,971,677

1,942,854

Gross profit

198,020

171,319

746,361

681,267

Selling, general, and administrative expense

94,943

94,898

391,315

391,744

Operating profit

103,077

76,421

355,046

289,523

Other income (expense), net:

Interest expense

(7,745)

(9,083)

(32,456)

(37,823)

Loss on extinguishment of debt

(233)

Other, net

85

566

733

2,078

Other expense, net

(7,660)

(8,517)

(31,956)

(35,745)

Income before income taxes

95,417

67,904

323,090

253,778

Income tax expense

(24,660)

(21,919)

(76,067)

(62,783)

Net income

$

70,757

$

45,985

$

247,023

$

190,995

Net income per common share:

Basic

$

2.16

$

1.38

$

7.50

$

5.65

Diluted

$

2.13

$

1.36

$

7.42

$

5.56

 

Weighted average shares outstanding:

Basic

32,789,911

33,297,613

32,917,971

33,806,104

Diluted

33,189,104

33,886,904

33,299,986

34,376,555

NYSE:BLD

February 23, 2021

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TopBuild Corp.

Consolidated Balance Sheets and Other Financial Data

(dollars in thousands)

As of December 31, 

2020

2019

ASSETS

Current assets:

Cash and cash equivalents

$

330,007

$

184,807

Receivables, net of an allowance for credit losses of $6,926 at December 31, 2020, and allowance for doubtful accounts of $4,854 at December 31, 2019

427,340

 

428,844

Inventories, net

161,369

 

149,078

Prepaid expenses and other current assets

17,689

 

17,098

Total current assets

936,405

 

779,827

Right of use assets

83,490

 

87,134

Property and equipment, net

180,053

 

178,080

Goodwill

1,410,685

 

1,367,918

Other intangible assets, net

190,605

 

181,122

Deferred tax assets, net

2,728

 

4,259

Other assets

11,317

 

5,623

Total assets

$

2,815,283

$

2,603,963

LIABILITIES

Current liabilities:

Accounts payable

$

331,710

$

307,970

Current portion of long-term debt

23,326

34,272

Accrued liabilities

107,949

 

98,418

Short-term lease liabilities

33,492

 

36,094

Total current liabilities

496,477

 

476,754

Long-term debt

683,396

 

697,955

Deferred tax liabilities, net

168,568

 

175,263

Long-term portion of insurance reserves

50,657

45,605

Long-term lease liabilities

53,749

54,010

Other liabilities

13,642

 

1,487

Total liabilities

1,466,489

 

1,451,074

EQUITY

1,348,794

 

1,152,889

Total liabilities and equity

$

2,815,283

$

2,603,963

As of December 31, 

    

2020

2019

Other Financial Data

Receivable days

48

53

Inventory days

30

28

Accounts payable days

76

80

Receivables, net plus inventories, net less accounts payable

$

256,999

$

269,952

Receivables, net plus inventories, net less accounts payable as a percent of sales (TTM) †

9.3

%

10.3

%

Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches

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February 23, 2021

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TopBuild Corp.
Consolidated Statements of Cash Flows
(in thousands)

Year Ended December 31, 

2020

2019

Cash Flows Provided by (Used in) Operating Activities:

    

    

    

Net income

$

247,023

$

190,995

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

62,410

52,700

Share-based compensation

14,752

13,658

Loss on extinguishment of debt

233

(Gain) loss on sale or abandonment of property and equipment

(88)

1,399

Amortization of debt issuance costs

1,491

1,558

Provision for bad debt expense

6,270

7,065

Loss from inventory obsolescence

2,512

2,622

Deferred income taxes, net

(4,070)

8,888

Change in certain assets and liabilities

Receivables, net

2,612

(27,146)

Inventories, net

(11,843)

17,433

Prepaid expenses and other current assets

(460)

9,361

Accounts payable

16,844

(5,124)

Accrued liabilities

20,545

(2,690)

Payment of contingent consideration

(413)

Other, net

66

1,058

Net cash provided by operating activities

357,884

271,777

Cash Flows Provided by (Used in) Investing Activities:

Purchases of property and equipment

(40,938)

(45,536)

Acquisition of businesses

(83,408)

(6,952)

Proceeds from sale of property and equipment

2,463

2,321

Other, net

25

Net cash used in investing activities

(121,883)

(50,142)

Cash Flows Provided by (Used in) Financing Activities:

Proceeds from issuance of long-term debt

300,000

14,989

Repayment of long-term debt

(324,948)

(27,793)

Payment of debt issuance costs

(2,280)

Taxes withheld and paid on employees' equity awards

(14,932)

(12,951)

Exercise of stock options

1,438

Repurchase of shares of common stock

(49,151)

(110,911)

Payment of contingent consideration

(928)

(1,091)

Net cash (used in) provided by financing activities

(90,801)

(137,757)

Cash and Cash Equivalents

Increase for the period

145,200

83,878

Beginning of period

 

184,807

 

100,929

End of period

$

330,007

$

184,807

Supplemental disclosure of cash paid for:

Interest on long-term debt

$

30,896

$

36,244

Income taxes

77,689

43,310

Supplemental disclosure of noncash activities:

Leased assets obtained in exchange for new operating lease liabilities

$

38,646

$

128,838

Accruals for property and equipment

645

542

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February 23, 2021

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TopBuild Corp.

Segment Data

(dollars in thousands)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

Change

2020

2019

Change

TruTeam

Sales

$

508,812

$

475,929

6.9

%

$

1,943,461

$

1,906,730

1.9

%

Operating profit, as reported

$

81,657

$

63,661

$

294,793

$

253,230

Operating margin, as reported

16.0

%

13.4

%

15.2

%

13.3

%

Rationalization charges

(24)

866

159

Acquisition related costs

177

4

636

COVID-19 pay

363

1,278

Operating profit, as adjusted

$

82,020

$

63,814

$

296,941

$

254,025

Operating margin, as adjusted

16.1

%

13.4

%

15.3

%

13.3

%

Service Partners

Sales

$

251,535

$

223,244

12.7

%

$

926,207

$

862,143

7.4

%

Operating profit, as reported

$

33,731

$

25,234

$

115,343

$

90,388

Operating margin, as reported

13.4

%

11.3

%

12.5

%

10.5

%

Rationalization charges

783

109

COVID-19 pay

21

90

Operating profit, as adjusted

$

33,752

$

25,234

$

116,216

$

90,497

Operating margin, as adjusted

13.4

%

11.3

%

12.5

%

10.5

%

Total

Sales before eliminations

$

760,347

$

699,173

$

2,869,668

$

2,768,873

Intercompany eliminations

(38,860)

(36,824)

(151,630)

(144,752)

Net sales after eliminations

$

721,487

$

662,349

8.9

%

$

2,718,038

$

2,624,121

3.6

%

Operating profit, as reported - segments

$

115,388

$

88,895

$

410,136

$

343,618

General corporate expense, net

(6,174)

(6,568)

(30,785)

(30,174)

Intercompany eliminations

(6,137)

(5,906)

(24,305)

(23,921)

Operating profit, as reported

$

103,077

$

76,421

$

355,046

$

289,523

Operating margin, as reported

14.3

%

11.5

%

13.1

%

11.0

%

Rationalization charges †

(4)

15

2,097

1,992

Acquisition related costs †

518

166

855

1,200

Refinancing costs

57

COVID-19 pay

384

1,368

Operating profit, as adjusted

$

103,975

$

76,602

$

359,423

$

292,715

Operating margin, as adjusted

14.4

%

11.6

%

13.2

%

11.2

%

Share-based compensation

2,593

2,246

14,910

13,658

Depreciation and amortization

14,883

13,696

62,410

52,700

EBITDA, as adjusted

$

121,451

$

92,544

$

436,743

$

359,073

EBITDA margin, as adjusted

16.8

%

14.0

%

16.1

%

13.7

%

Sales change period over period

59,138

93,917

EBITDA, as adjusted, change period over period

28,907

77,670

Incremental EBITDA, as adjusted, as a percentage of change in sales

48.9

%

82.7

%

†Rationalization charges and acquisition related costs include corporate level adjustments as well as segment operating adjustments

NYSE:BLD

February 23, 2021

topbuild.com


10

TopBuild Corp.

Non-GAAP Reconciliations

(in thousands, except share and per common share amounts)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

2020

2019

Gross Profit and Operating Profit Reconciliations

Net sales

$

721,487

$

662,349

$

2,718,038

$

2,624,121

Gross profit, as reported

$

198,020

$

171,319

$

746,361

$

681,267

Rationalization charges

1,016

COVID-19 pay

380

1,135

Gross profit, as adjusted

$

198,400

$

171,319

$

748,512

$

681,267

Gross margin, as reported

27.4

%

25.9

%

27.5

%

26.0

%

Gross margin, as adjusted

27.5

%

25.9

%

27.5

%

26.0

%

Operating profit, as reported

$

103,077

$

76,421

$

355,046

$

289,523

Rationalization charges

(4)

15

2,097

1,992

Acquisition related costs

518

166

855

1,200

Refinancing costs

57

COVID-19 pay

384

1,368

Operating profit, as adjusted

$

103,975

$

76,602

$

359,423

$

292,715

Operating margin, as reported

14.3

%

11.5

%

13.1

%

11.0

%

Operating margin, as adjusted

14.4

%

11.6

%

13.2

%

11.2

%

Income Per Common Share Reconciliation

Income before income taxes, as reported

$

95,417

$

67,904

$

323,090

$

253,778

Rationalization charges

(4)

15

2,097

1,992

Acquisition related costs

518

166

855

1,200

Refinancing costs and loss on extinguishment of debt

290

COVID-19 pay

384

1,368

Income before income taxes, as adjusted

96,315

68,085

327,700

256,970

Tax rate at 26.0% and 26.5% for 2020 and 2019, respectively

(25,042)

(18,043)

(85,202)

(68,097)

Income, as adjusted

$

71,273

$

50,042

$

242,498

$

188,873

Income per common share, as adjusted

$

2.15

$

1.48

$

7.28

$

5.49

Weighted average diluted common shares outstanding

33,189,104

33,886,904

33,299,986

34,376,555

NYSE:BLD

February 23, 2021

topbuild.com


11

TopBuild Corp.

Same Branch and Acquisition Net Sales and Adjusted EBITDA

(dollars in thousands)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

2020

2019

Net sales

Same branch:

TruTeam

$

487,593

$

475,929

$

1,906,012

$

1,906,730

Service Partners

251,535

223,244

926,207

862,143

Eliminations

(38,860)

(36,824)

(151,630)

(144,752)

Total same branch

700,268

662,349

2,680,589

2,624,121

Acquisitions (a):

TruTeam

$

21,219

$

$

37,449

$

Service Partners

Eliminations

Total acquisitions

21,219

37,449

Total

$

721,487

$

662,349

$

2,718,038

$

2,624,121

Acquisitions proforma adjustment †

$

48,469

TTM net sales, acquisition adjusted

$

2,766,507

EBITDA, as adjusted

Same branch

$

118,413

$

92,544

$

430,510

$

359,073

Acquisitions (a)

3,038

6,233

Total

$

121,451

$

92,544

$

436,743

$

359,073

EBITDA, as adjusted, as a percentage of sales

Same branch (b)

16.9

%

16.1

%

Acquisitions (c)

14.3

%

16.6

%

Total (d)

16.8

%

14.0

%

16.1

%

13.7

%

As Adjusted Incremental EBITDA, as a percentage of change in sales

Same branch (e)

68.2

%

126.5

%

Acquisitions (c)

14.3

%

16.6

%

Total (f)

48.9

%

82.7

%


(a) Represents current year impact of acquisitions in their first twelve months

(b) Same branch EBITDA, as adjusted, as a percentage of same branch sales

(c) Acquired EBITDA, as adjusted, as a percentage of acquired sales

(d) Total EBITDA, as adjusted, as a percentage of total sales

(e) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales

(f) Change in total EBITDA, as adjusted, as a percentage of change in total sales

† Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches

NYSE:BLD

February 23, 2021

topbuild.com


12

TopBuild Corp.

Same Branch and Acquisition Net Sales by Market

(in thousands)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

2020

2019

Same branch:

Residential

$

550,960

$

512,715

$

2,104,233

$

2,016,016

Commercial

149,308

149,634

576,356

608,105

Same branch net sales

700,268

662,349

2,680,589

2,624,121

Acquisitions (a):

Residential

$

18,969

$

$

23,650

$

Commercial

2,250

13,799

Acquisitions net sales

21,219

37,449

Total net sales

$

721,487

$

662,349

$

2,718,038

$

2,624,121


(a) Represents current year impact of acquisitions in their first twelve months

NYSE:BLD

February 23, 2021

topbuild.com


13

TopBuild Corp.

Reconciliation of Adjusted EBITDA to Net Income

(in thousands)

Three Months Ended December 31, 

Year Ended December 31, 

2020

2019

2020

2019

Net income, as reported

$

70,757

$

45,985

$

247,023

$

190,995

Adjustments to arrive at EBITDA, as adjusted:

Interest expense and other, net

7,660

8,517

31,723

35,745

Income tax expense

24,660

21,919

76,067

62,783

Depreciation and amortization

14,883

13,696

62,410

52,700

Share-based compensation

2,593

2,246

14,910

13,658

Rationalization charges

(4)

15

2,097

1,992

Acquisition related costs

518

166

855

1,200

Refinancing costs and loss on extinguishment of debt

290

COVID-19 pay

384

1,368

EBITDA, as adjusted

$

121,451

$

92,544

$

436,743

$

359,073

NYSE:BLD

February 23, 2021

topbuild.com


14

TopBuild Corp.

2021 Estimated Adjusted EBITDA Range
(in millions)

Twelve Months Ending December 31, 2021

Low

High

Estimated net income

$

297.5

$

326.7

Adjustments to arrive at estimated EBITDA, as adjusted:

Interest expense and other, net

24.2

21.2

Income tax expense

104.5

114.8

Depreciation and amortization

67.0

63.0

Share-based compensation

11.8

9.3

Estimated EBITDA, as adjusted

$

505.0

$

535.0

NYSE:BLD

February 23, 2021

topbuild.com


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Document and Entity Information
Feb. 23, 2021
Document and Entity Information [Abstract]  
Document Type 8-K
Document Period End Date Feb. 23, 2021
Entity File Number 001-36870
Entity Registrant Name TopBuild Corp
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 47-3096382
Entity Address, Address Line One 475 North Williamson Boulevard
Entity Address, State or Province FL
Entity Address, City or Town Daytona Beach
Entity Address, Postal Zip Code 32114
City Area Code 386
Local Phone Number 304-2200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, par value $0.01 per share
Trading Symbol BLD
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001633931
Amendment Flag false
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