JELD - Earnings call 4 2023 | JELD-WEN Holding, Inc.

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Operator

Thank you for standing by, and welcome to the JELD-WEN Fourth Quarter and Full Year 2023 Results Call. I would now like to welcome James Armstrong, Vice President, Investor Relations, to begin the call. James, over to you.

James Armstrong

Thank you, and good morning. We issued our fourth quarter and full year 2023 earnings release last night and posted a slide presentation to the Investor Relations portion of our website, which can be found at investor.jeld-wen.com.

this our referencing be will presentation call. during We Christensen, Officer; and I'm joined Albrecht, Executive Bill by Officer. Today, Julie Chief Chief Financial

turn in that our uncertainties, These not subject XX-K future of Private constitute our with those Securities for update results. Bill, statements expectations to provided statements forth within the everyone are call, it release and Reform providing the of like forward-looking undertake does will risks I that the meaning to including we statements remind guidance this to Forms that variety Act in XX-Q I certain JELD-WEN to make Litigation a the to during earnings with Before including would duty filed forward-looking and statements, certain respect we're over of and set SEC. XXXX. any

discuss to during or prepared that, presentation performance. A measures, now the our most in of with call non-GAAP which appendix we we and this our GAAP. to in be of earnings in call, additional not Additionally, can evaluating measures for The results useful earnings a found calculated should their substitute can to non-GAAP considered today's these in will measures release directly comparable in our of Bill. the I'd under GAAP like reconciliation accordance presentation. With be believe financial as be information isolation, over turn

William Christensen

to plan to execute brief leaders discuss improve I'll our today. joining taking discuss progress several for handing financial on return quarter call providing their to financial results great expected, to over for discuss our actions Thank fourth we're earnings we our guidance thank to new everyone, of than the work I'm our to want I'll results, questions. I'll strengthening performance giving X. you, quarter Slide better of and continued before taken and together report start on fourth then of James, our a some I'll thank by employees highlights we overview and activities. Today, JELD-WEN. our our were detail. Julie our pleased that your with and fourth foundation I you, the the before making improvement dedication as we've and of to then performance. journey, introduce financial transformation begin in of more XXXX quarter all

our While our expectations, of guidance, the with earnings end above actions. sales ongoing top in were of due were line to solid productivity primarily our execution

margins significantly a As year-over-year. improved result,

capital driven to continue cash working generate earnings reduced strong We and balances. flows, by improved

achieved accomplished achieved. On selling last improved we proud steps on our the see improving you to journey driving goals of team and X, are our important some to I'm performance the to streamlining Slide our we our our as savings well as year, transformation results. of additional what improvements business that as important focused Australasia as look and And including business. continue back XXXX I'm the business. At our took as costs, at initiating Lastly, I XXXX, cost pleased we the XXXX, such in beginning closures report business. that we fixed of what across remove implement actions We're site committed

long-term the our prioritize debt. proceeds, using repaid strengthening we and million $XXX Australasia divestiture sheet, we Next, balance of

We cash flow also made reductions our part generation. significant an strong working of that were capital important

year-end. of X.Xx, down this the X.Xx of All delivered leverage prior from at a net

we cost million I targeted the delivered steps mentioned have our we taken sites. savings. cost earlier, $XXX announcing X reduce closing Finally, base, And to our or of significant of closure including as

in outlined said to As journey. On some our fourth phase would X, foundation, actions we on quarter, focus Slide of our and you areas see, transformation performance. delivering can continued the seriously, we of major people initial a key and take we we're our our we we strengthen commitment key of do. In the what

part believe in goals. these support leadership leaders. we behaviors of we that weeks, targeting training stream, the work program the key our coming global and about culture We're achieving behaviors capabilities starting X,XXX will finalized our As a broad

planning action This have process information, us to network gather the the associates projects change an are extensive network plan by many our support network. for followed consists recognized important completed levels. trusted effectively all thousands their each generate a for case provide our a as within change by more we associates share will ideas, launching of underway. Switching of project to was agent XXX peers initiative. at that Another we leaders and insights and both engage business who and performance, approximately agent organization allow The to bottom-up

approach We and disciplined to our are track initiatives have these progress. now a implementation using sequenced

these Our that is improvements. will to lead expectation profitability significant projects long-term

Finally, in X we XX over more to next expected drive or these the phase that the announced closure million in Europe. months. facilities America annual of and completed improvement EBITDA of are closures will North Combined, $XX than

journey, it important we the changes right the to transformation our of is part As that planning. people significant execute have we're

announced leadership you X, on new added executives team. several Slide X, we and to recently February As on see as our senior

and as Vianna He as President promoting various commercial change. of transformations Europe. appointed Gustavo from experience EVP brings companies. experience multinational decades of His and includes cultural as First, over was X operational well

significant our dynamics, experience. possesses market Dan His be and valuable in years as and America development Corporation, was nearly strategic of he expertise Doors product joined Appliances. from us & Manager making Dan roles, and supply understanding leadership where commercial, Second, will growth SVP chain opportunities informed Whirlpool decisions identifying North appointed Distribution. most General to as Small team. Valenti KitchenAid extremely in XX spent EVP Dan recently

and us Chief Data catalysts it turn responsible our Julie as and most over automotive services confident helped insights multiple His EVP, where Matt forward that Chief in the advance achieve Finally, Holdings, helping digital their expertise. I'll has Digital transformations. us financial & has technology companies joined position EVP, results. I Digital aftermarket Officer be goals, data Information Brand Matt to leaders now these in was he largest to the Driven for will Meier recent look for provider was America. We're discuss North to outcomes their at Officer. new and important

Julie Albrecht

Bill. Thanks,

Looking X. Slide at

closures, Our in decrease leading market-driven fourth the year-over-year This was to that down a full points billion, our our margin results quarter, the an in reduction story due adjusted and execution EBITDA a million productivity you both of to up of declines margin sales, XXX in sourcing in site basis approximately EBITDA optimization. On volume $X were similar X.X%. reductions, North America revenues driven by the XX% from freight XXXX year-over-year see quarter actions reflects Europe. This tell was adjusted our prior management strong revenues year as the quarter. XX, improvement areas headcount fourth $XX core Slide lower such as year. XX% solid our of and Despite fourth

lower driven Our decrease revenues X% was full $X.X year our as year-over-year. X% revenue volume/mix was by XX%, a was core price from partial This billion, offset with by down realization. higher of

adjusted EBITDA $XXX XXXX expanded X.X%. year margins points X% by and by to basis full million to XXX increased Our

price/cost Our EBITDA offset full impact year the cost that by volumes. positive lower operating by from growth reductions results was partially were driven and

in flow and As XXXX, cash we our our increased leverage. reduced Bill significantly earlier, mentioned

capital $XXX improvement that see a strong and we Turning XX, performance we had flow, as Slide our balances. year-over-year operating you generated significantly operational million million to working cash of $XXX reduced

strong sale the of substantially flow, proceeds our from X.Xx more Australasia Using our XXXX. by we improved the ratio full net balance our also cash the end and than turn We business of sheet. a to reduced leverage at

X.X X.Xx. Our range target leverage of is now to within our midterm

offset about Europe fourth America quarter volume XX, our you realization impact. see comments provide shortly. of can X% I'll positive by volume/mix exchange North and lower by revenue X% trends was Slide slightly on and which a additional As foreign was price driven our of decline translation XX%,

including XX, contributions favorable you'll for and walk, find fourth Despite the the increased earnings full see by you from lower million adjusted presentation. On our EBITDA the and of we segment improved in profit productivity, solid Additionally, SG&A that quarter a $X Slide significant volume/mix price/cost. expenses revenue year-over-year. appendix our headwinds, generated year details

to inflation focused as costs price/cost, we as discipline, do and in such labor continue see pricing remain insurance. Regarding we on

America of XX% was to results Slide segment was revenue the ago This to levels. core our in XX. Moving XX%. generated lower volume/mix sales, our decline year a due North segment quarter, of decline from fourth million by which a XX% driven on In $XXX of

$XX inflation basis XXX of to declined from offset offset in the and was fourth X% by million demand However, which generated in by EBITDA up XX.X%. adjusted quarter, to improved weak decreased to productivity, decline Europe, million, last we more lower that was price revenue was Core while revenues million $XX margins relative which EBITDA. points improved North due XXX Adjusted due productivity. This to impact of This America's than driven of XX% and XX%. strong negative by million adjusted $X EBITDA partially $XXX year-over-year, leading basis points the volume/mix. In positive year, lower was margin. by to lower volume/mix improved continued by in to

America. turning outlook with Now Slide North and market XX, starting to the on

down anticipate will North up home that year. digits We be volumes construction slightly new America We the XXXX. to expect single low by during single-family be in to flat

with expect activity on relatively R&R create Existing remodel high affordability by interest sales at challenge. reluctant we low the rate consumer currently are be digits. In continue and remain to and low uncertain, to levels, and confidence mid-single interest repair weigh people to as remains activity for outlook rates to the However, low U.S., an down mortgages move. home

geopolitical in creates down starts. The by However, remained macroeconomic to Europe, market that and region demand volumes to these across markets European anticipate weakness construction is the challenges. digits. volumes soft the new to we digits. this Residential expected housing opportunity will and increased we be single high Overall, anticipate due by down dynamic be experiencing high an single for ongoing continue

are decline to digits. I'll to back talk Additionally, Europe, journey. it volumes slowing our Bill expected and is commercial this now demand by project transformation to turn about in mid-single

William Christensen

Julie. Thanks,

calls, a to we're I've approach in two-pronged improve shared business. previous taking As our earnings

on show Slide on our XX, strengthening As we're the of foundation focusing short business. we in the term,

the performance. we're improving underscore operating costs reducing results and operational making progress on significant our XXXX solid Our our

we still should to and be, not more remain that strong do. We our However, our margins supports growth. foundation to are lot committed they work a a have building future where

In addition grow win. we focus, to commit business, assess and have to where to to we to continue invest short-term our the the right opportunities only we

for opportunity come. see to While of profitable is growth lot a we this years the ongoing, in process

Turning to people engaging is We're areas currently and both I've on our performance culture my associates and of impact activities XX, results. financial journey X around Slide world positively are and shared in strategy, people, thousands transformation and to focused as focus performance. before, the

identified, our progress to training everyday connect values to sequenced our organizational measuring work. important getting we're our to on about working then XXX our more to includes validated and continuous have than more clearly safety, teams accountability. culture, behaviors, the about improvement more and and This initiatives. in talk our health our I'll Related now feedback Our performance. including activities slides. Shifting from investing more We're teams. next

balanced a improve include activities. initiatives within actions. focus on our numerous our and and both to commercial Our processes team strength, working cost growth various tools We're reduction

cultural aimed challenge. continue more give committed we our work on smaller agent network in rightsize in investing few within training as network who accelerate ROIC communication change information timely honed our solid automation, These examples first areas X our communication at type training a this the our incentives. We're to XX empowered to deliver a projects. Slide future. To we're health support In many manufacturing streamline in of that approximately to among through of in addition, programs understanding employing specific we XXX transparent significant global management network. This presents reaches execute of doing, half of pipeline employing a projects on of comprises individuals in our our the the of initiatives investing a scale more I organization we're individuals year across and our channels. One ensuring we are utilize After leadership, to to in profitability you variety manner walk the at is assessing outlines XXXX, communication change index organizational high the recently transformation. In culture. the a in fostering informal areas: improved other utilizing our focus agile well and have through want also fostering ourselves better we're employee cover and as sourcing on important and all as invest We're key technical development our initiatives. launched of levels, right and to improve skills. communication, method organization, a formal both Nevertheless, to organization.

learning experiences. also we're trainings mentorship some more for settings, classroom take in While formal of leveraging these place effective on-the-job

Finally, Simultaneously, rewards improving recognition decentralizing to responsibility, both realigning organization. behaviors. accountability within we're financial and and we're across connectivity improve the while with performance organization the targeted

we that to identified process. the of on Slide we performance efficiency XX, underway shifting growth-oriented Now have we our opportunity Europe. quoting one have improving show in An in projects is

Our IRR $XX customer of systems. we approximately the capital, both expect over service, EBITDA a accurately than identify developing customers. To Configure, the cumulative with European then price million that X refine is The detailed million next but our to allow team fit more quotes Quote anticipate profit quotes improve our $X.X or their a and and system to manufacturing will years integrate configure next-generation project system, customers spend XX%. to will orders execute impact provide project, visibility Price expense this an we their products more complete, is than in and our When needs. right and CPQ, will JELD-WEN of this that own and and

performance-related more of operational to year generate work Once than Moving also to expected an in XX. a than an in the North EBITDA just increase complete, production in project are is from of first address want will resulting elevate came automation line X to planning this project facility, is examples and improve Door our proven a cycle to large highlight a duration. with I America drive ramped XXX our Furthermore, in our that to lead By investments up, bottlenecks on opportunities process. serve. These to cost XX%. is and once million leveraging substantial complexity will the $X small over the will projects technology, build projects that of network our this in a our it This series quality. product further reduction fully reduce more our efficiencies initiative Slide bottoms-up IRR to in Facilities. initiative and

projects EBITDA. our profitability. I now revenue want to for a On will these with discuss guidance foundation solid much our JELD-WEN, lead expect see We to adjusted a stronger initial guidance. Slide you XX, significantly improved and and XXXX

XXXX $XXX by in X% driven our between XXXX. revenue the and billion is expected North expect as and to revenues America range be productivity which core flat compared We are uncertainty we be Julie mentioned improvements. that within earlier anticipate potentially $XXX offset million her million, lower as continuing our Europe We driven to to $X.X to than adjusted in fall of our by This to be the more both comments. EBITDA $X.X billion ongoing volumes, down to will by market expect

a basis million improving our cost million, a savings last XX is from expect approximately and benefits year carryforward be year. of We of margins actions last At will $XXX are midpoint initiatives X.X%, guidance, this that $XX delivered solid of which the of new approximately points. to from combination X.X% year's our

lower As had expect when headwinds we lower and year. phasing be quarter we entered we volume XXXX than backlogs the look due earnings slightly to last this EBITDA to at of than year, same period in our the anticipated first we

and the the internal the from of ramp first expect the up investments information However, Slide about cash second we like half in outlined XX. some EBITDA year, to of is throughout approximately which remainder XX% our provide in therefore, XXXX, to flow benefits half. I'd for year outlook the expect on and now our

$XXX approximately expenses transformation similar we our year's this be We flow cash expect portions invest of million XXXX, before to fund to cash nonrepeating will that operating of journey.

capital of up these and X% to in future we sales future, of set to addition the approximately business ourselves investments increase for to out In drive growth. to costs plan JELD-WEN's our expenditures

I of on our $XX in, we're million capital. All investments the operating to which above focused keenly free approximately from to these we our delivering to of year, our see future, $XXX flow be cash projects cost significantly reflects can earlier, JELD-WEN's you our ability expect and discussed in this million returns both that strong with self-fund flows. commitment cash investing examples planned to As

turn updating to let's on year journey our transformation wrap to XX. I excited I'm progresses. this As up, as Slide you continue

will next mentioned know growth what We by and improves. foundation, seriously, executing to said for on deliver market continued profitability our we're do. preparing we fixing when we significantly I that and to earlier, that have to the the confident As we commitment profitable interest, take we're improved capital. We now return over and I'm Q&A. few I'll appreciate move over on it turn JELD-WEN your will James invested years, our

James Armstrong

Thanks, Bill. we're Q&A. now Operator, ready to begin

Operator

Ng Our the Instructions] with [Operator Jefferies. from line question first of Phil comes

Philip Ng

appreciate exciting. really the you And Congrats Bill, journey. shared the quarter. today sounds terms It us really on I a in strong of color transformation with really

William Christensen

Thanks, Phil.

Philip Ng

progress, in I about is help process investments the us time think normalized maybe there how the profile years? years, next decentralizing of to the what's think in savings margin take and few way to help efforts of from take growth you're target it's standpoint just environment? the these Is But a training or some that flight. an to aspire in productivity productivity whether through perhaps a making these kind even to EBITDA some and us next more deliver appreciate going you a the aspirationally growth few

William Christensen

Yes.

Phil, question. So you thank for the

line. in where pipeline we projects: million some other 'XX, $XX be to which in will year. automation the in going late our installed talked projects As of the we've of obviously, XXX prepared sequenced a we working and as transformation, my that so in through, shared years. remarks, look these, next have over number at the we're that There's that one, in our we're significant door that's we I of over probably are facilities equipment, but the expect the pipeline ordering currently to projects, bottom and about And dropping deliver we there's and

than years. in So and that out will impact clearly 'XX an have

clearly get see the we as we going what that early too that sight strong line us of to we're But deliver in pipeline, what commit into will be too we today, see year. to it's early out back the ramping years, project based calibrate. is but 'XX. We'll to on for this our the half in of have So expectation to up

our actions think this overcompensate Phil, we as year, message market with want internal is did did year, headwinds I to Our well. we the we last and

benefit we we lose of that to headwind, ramp be going as we're what in end we'll QX into, back as a pipeline QX, let's we're and significant So up the results. sales expecting year, expecting to deliver we're roll the get into more but sharing than say,

Philip Ng

And for Julie, been perhaps about their to That's hear a a to about little price/cost when question color pressing great aggressively XXXX, you're suppliers neutral. pricing There's you're maybe standpoint? Okay. a largely then us chatter you you what on retail a pricing be some there think on of the from helpful. seeing out that more concession. lot expecting give Can channel,

us there's So you're a with year? little help into context be us give outlook that line your in terms baked if negotiations mindful of? And component, any of retail terms -- what's what's for of the cost, where what's channel, the price, then we should this reviews of in price/cost

William Christensen

Yes.

I and Phil, high then augment with level, some Julie maybe can So can maybe at a start details.

So standpoint. our from of at year would last we be to end cost price up. say, aspiration caught I this year, finally definitely had neutral is the a

do with so There's the a us even there's were you benefit We up. for inflation. still while well see we've labor caught As down cost inflation, there's know, volume. feel coming on at price inflation inflation, that we we lagging glass and

Negotiations increasing. neutral that best pretty input down We're potentially doing costs our a are ongoing. is key the volume are to aspiration year there clearly, in that. demanding are And market. this offset So some

Some complete. are already

conclusions teams draw our neutral. feel say where to want giving it's work, we to their the price/cost things early that we too are So guidance comfortable doing be currently but I'd final land, and about

Julie Albrecht

little to Maybe that. add Yes. a I'll just bit

I similar again, we impacts single-digit Specific of Bill think looking saw prices, inflation low inflationary top increase last are at neutral, this line focus we mentioned. to really we'd the from that on very just say just price very impact in year. maybe labor, 'XX type to year that

But as is in really Europe it, as North benefits, mentioned inflation to labor we're what again, and of X% Otherwise, still certain slowdown America all inflation materials. no already and our increases call And aspects there in labor I today, between well. there experiencing. know, insurance definitely, definitely So mean, is kind as related we of is X% we've moderating.

Operator

Goldman question Sachs. line from Our comes Susan next the of Maklari with

Susan Maklari

expectation I your a first in to want is single-digit North potentially volumes down America The be focus that somewhere range. on bit to question low for

of then coming we about or of we And to as see the As through some the think single-family there coming upside through, think do year that that the start thoughts through? you how do on activity any perhaps? from starts cadence

William Christensen

Yes.

the So for thanks question, Susan.

year XH at looking how Here's, we're XH potentially. the talk I'll maybe level, how from high currently, and looking end a then we're about at versus the at

X if So X North relevant, relevant. we down break we are that very America, buckets are got

bucket seeing new our have the our to construction, small business, very is commercial, small That's we close mid-single. is about single-family, a it's slightly up flat that's we're of low do of sales sales XX% North or And VPI. growing is multifamily in and well. So to down XX% a We're which which share, nonresidential 'XX. R&R, America. of in to

material market gaining that's mover talking to sales. that a is again, digits. single expect for high not double about because down only We're total X% of share. less we're us. We see ourselves But be down We going than

market not on R&R of half people in the HX flat there's But planning -- a do into talking little resi the Number that retail view pick is the and and a So couple that little attractive, look more things. at upside current upside. remodel, some more new With mortgages headwinds the half, would today year. get be down bit potential with that of say then some resale really as a customers, interest to back as new potential potentially easing And trigger to move market we're definitely a low to residing becoming slightly down one, someone a on up. of rates it still, to the into or view resi our macro we we upside. that that if repair definitely and could up, partners mid-single. I'd had could

flat the current think can is And optimistic be given top what definitely Europe year-over-year. case, end see in U.S. that would the imply is that view. actually be line down. And would high You being to slight of growth guidance, an we're our thinking and I

of that's a give HX, we're. Julie what balance look can going like where sales little more kind So is on HX. the to

Julie Albrecht

Susan. midpoint sales Bill. we do at the guess Sure, of year, than the of guidance, see, X Yes. I when weaker our X at look phasing half. we the through half a little bit

So X looking of maybe which of being half first and North slightly our Europe. off year lower. center pretty between bit XX% of balanced America that sales, XX-XX means a that's first decline about little half split is in a there, just That at half 'XX, really this versus

when half look half this comps do year see year of -- So little last the weakness again, half first bit second you versus at we first there. a of year, -- first

bit into stronger first little was of quarter than was normal that our 'XX QX we of stronger kind a has mentioned, because year. bringing already expected were we of than last Bill As for had backlog and seasonality

more that does create a QX. to So comp difficult specific

The this see year and then really go year and mention versus first the is flat about just of half we this year at I'll half other of margins thing second last year-over-year. being first relatively half in looking ahead

around help at the sales, a in X.X% year. maybe of in first of XX% half. That benefit a that from So despite lot again, our the really means or the margins what we -- or around margins bit maintain was of the sales does in the to ramp-up of little half expand second do so and productivity lower so, expect

Susan Maklari

does a That's from on those initiatives quarters Okay. building the in gained bit, so. have like And helpful last commentary, really it maybe color. momentum productivity that very the some or sound

that in for into in realized? you improvement lift, those think And and the and tailwinds of what way any be on there business just and they As half with potential could broadly year the volumes the thoughts these terms that mean mean what of the second about some results? could initiatives the they coming for could speaking, an

William Christensen

Yes.

macro if significant back. great we homework leverage is year. the volume order, exit demand. pent-up for that of opportunity what XXX need end doing we work will mean U.S. rate to now, foundation trying the We next this our is, underbuilt. pretty to X the Susan, we know know operating what to getting Clearly, we're the be do upside I kind bounces to back. the it's with create is in So but running volume a about balanced think the bounce us a significant get of the again, the see And There's as a And of streams years. clearly, into to have actually we a are pretty that lot going we're we over And move over done. as ramp this run currently -- up

be be clearly If on we that's doing the will surprise headwind. manner, significant. but clearly, more expecting in uptick good outpace our and our homework, upside not us, things controlling and to a those that what positive market news a delivering volume for results see will we're so planning 'XX. We're in change, everyone And we're

think I'd operating our the cost chains XX% supply we've capacity And that in we the see to told of on making for and balanced a done are past, good leverage serve you say, in and in job to XX% future. really our our well we've sure uptake. dialing I XX the the last, months

we because margins, from the as that I prepared So where still need be. do a in to need still remarks, shape, said to our we good feel are homework and way of doing we're we my pretty lot away in that a long

Operator

comes UBS. of question next from the Lovallo Our line with John

John Lovallo

in decline within versus there lower in a basis even quarter, is perhaps XX% parse the versus core Europe, on basis out North negative that and volume maybe mix, impact the is consolidated one on way if fourth first of the The revenue America to any the possible? consolidated a

William Christensen

Yes.

So maybe would Julie high-level I with can John, of say -- some a in and maybe couple detail. jump comments, so then

America, North a QX, you QX. down the run in And look at significant -- There numbers. if price mainly clearly, So are volume. -- XX% was the I not XX% of those mean, it's rate, in in volume Europe, which pretty mix lot

if half driver. inventories in we're their about growth So in as is and to people potential this rebalancing balancing of of better some year, volume tight of in being fiscal market which America, was back position by weren't way, early themselves the North start of reloaded. And think the really And inventories going you are partners the especially the key some the large see that into year-end, a retail the lot to inventories their this starting for year.

So that are, say, some we that numbers expecting channel that's QX run the in help a we're in traction that. of to QX. Julie and seeing inventories, some some of going rates underscore the may pull feel share We're that can through detail I'd better balancing and to not we are why better QX. that signals saw

Julie Albrecht

just was little color that almost the Yes, entirely more a Europe, there. mix Really, in on volume.

probably really was XX%, that gosh, XX% negative was North being X%, volume within there So like negative America, incremental say of that impact X% mix very more volume/mix. little XX% negative I'd that mix. in

in little a in to America, the North have weighted of bit fourth in but still that again, lower did So quarter. volumes, negative region mix heavily

John Lovallo

single-digit meaningful impact And just really Europe. high low XXXX? single-digit then Okay. you mix for in and North in us volume you region moving Are the either gave expecting in maybe declines expectation forward, declines helpful. in That's volume any America

William Christensen

would say I no. Yes.

kind the year. of half on what track last back to going of saw it's we think I at

homes. have, new typically think just especially I'd of in lot the you down February, businesses mixing see, in starter profile we and constraints pushed What that and are construction projects VPI is price general, also we're a market have. say that projects the in on lower where market towards homes are projects financing on is tilted because commercial lot side, January the in we point better the based which Europe, out margin Canada, a being our the of If

still the to are they're just So people waiting. run projects, going

we're what in think at mixing general, which year. of saw do with we last So end consistent we down, the that, is

Operator

line Joe Deutsche with Our the next of comes question Ahlersmeyer from Bank.

Joseph Ahlersmeyer

finish the on here. year Congrats strong the to

William Christensen

Thanks, Joe.

Julie Albrecht

Thanks, Joe.

Joseph Ahlersmeyer

And America North of X your about talk business, today 'XX, guess, business end the these about, R&R views just of the multiyear beyond Yes. new could your Maybe you and which of moving the thinking construction things, parts upside on you on -- I of is markets enough, you your base, side 'XX? could you other? then deliver manufacturing more feel if speak guess, infrastructure to I to handle your how one just agile off in what also the distribution provide outperforming

William Christensen

Yes.

question starting Joe. first, with second the So

in we're our would cleaning I do say our distribution our definitely So all markets North and model. And our customers America. serve we key as assess that to that cost looking up footprint at across we're

sure of the state making overcapacity current we're in as based we're we some to in volume, to expect there's our light what that not future the on sites but be. So state, balanced, well. been clearly, And the market

great of continuing as a doing last think, have at is, all because offline we I know lot the to cost And year, taken well serve sites to to we an we've and there. So look been upswing balanced we're homework critically market that model. in

up kind of I'm roll in year. high-level go On and headwinds the we continue at going just we level into macro to you say very as look next a North a just forward America, that other view, clearly and to expect asked side, Europe

rates we're Europe said the but a weaker So expect as before, is units, come North America need years clearly, the of also America. definitely of outlook R&R there's And interest built. We than next clearly, kick under to couple activity snapback in in resales as would we going for down. North be in the when I

on-time America, levers as expect delivery to our the we're to quality is bottom if line. serve both see getting and North have And is they're volume we nice traditional both to currently cost and balanced. both on very and serve our And And our important we should retail of well to cost to meeting ready 'XX, that direction. those our operating segments. be those the ourselves expectations models be serve clearly, making we in an in leverage to We're of increase focused make that because in sure both So and expect customer that pillars, in some many both drops us. we're to able do sure in right moving people

Joseph Ahlersmeyer

how the sort level we understand productivity And year, Could some long of CapEx of it's coming type running at out for to about this on budget? here. if helpful. I we think Or us the invest might year, Julie, new next guide maybe of stable then, if help need really you see CapEx be the state? maybe That's this the

Julie Albrecht

Yes. in we've in results delivered growth shown underinvested the I efficiency, historically. and has think, JELD-WEN I'd both again, say, clearly, capital we'd in is say for the which, its past,

call to higher our to on TBD, opportunities. I it at elevated that, be on continue the to X.X%. evaluated obviously, X% I historical expect obviously we've if continues to pretty for our annual the that over bullish again, reevaluate would it but year, And We're pipeline. it, past, levels it capital. expect this absolutely X%, be I'd basis. than But We'll an think So

I'll that I and around The expenses note $XXX levels go we've this of to this to we year. this cash activity normal our that would is do year say beyond other year in expect thing million unique are we and year, back of nonrecurring we'd outlook got like our that for materials more mentioned that type feel to this

And investing so perspective that cash to and a also flow I ourselves. from wanted in highlight

William Christensen

high visibility our I Joe, projects, we just in XXX-plus And We're that would sequencing. add these system. Yes. have

way IRRs is ourselves the capital. in long and As we above, investing our XX% that deliver see and return as believe I outstanding for opportunity because to deploy right shareholders to we're an

what also the year capital to to we these the rate of time. investments this out, we'll all maturity the would a the push onetime and next funding currently and investing, see would We'll And are as just on run of will that be need attractive. year. at side. Julie will it's very be continue have through the expect mentioned pipeline still that make, projects be from the same the next we don't but into candidly, CapEx that I kind And the be have discussion if a same will but so elevated historical we portfolio, as year, we resource

we're So we biting not off we're making can more than sure chew. that

Joseph Ahlersmeyer

I of agree a lot Makes philosophy Yes. the sense. with there.

Operator

the from comes question of next line Rehaut JPMorgan. Michael with Our

Andrew Azzi

the Andrew in bit new in to baked hoping flat on of terms side slightly. maybe up looks maybe just is percentage to potentially America, single-family or that there? on wanted increase. Mike. as It some North maybe some I'm construction of for homebuilders Azzi year-over-year help ask conservative gap just And you least a to bridge the I and in little can conservatism me larger compared at maybe if there's This upside

William Christensen

in a would general. there the uncertainty. in back Well, to of level the half the to year, reality. high market X forget, going some which are to could key a products potentially months windows potentially still in so X I of Yes. built that Clearly, argue, levers there's don't macro start But are soften up are and process. in the then later doors in, until our we're improve behind this button the first envelope

takes to a So it for trickle while this down.

is point potentially and back. there, starts end, lower end the higher we we a out see but Second would come to like these it's see so actually

premium and our So windows the custom -- wood pull-through our products. for that's a and

comes pretty low end than back. some clearly, when value And there's the But good that so it's the appreciation of market. softer clearly, way market

that I to view. just because cautious. all and we're goes say, on. us our year I proud current things and overly there's that -- If so the think are would this So this would we'll in report be better, state, say influencing the things I as I call are happy wouldn't just that is careful many we're market then

Andrew Azzi

curious Understood. just I dollar Yes, margin on neutral. the basis appropriate. price/cost a guess I'm sounds Is think I basis? that that or a on definitely

Julie Albrecht

having Yes, on basis, margins. drops which, it's impact as dollar guess, really really I not a much through

year-over-year it's to changes a we close in X EBITDA. but about that, -- say And $X so we're neutral when talking yes, definitely targeting impact on

William Christensen

costs, better to job say, make talked, sure cleaning have the a mean, I of there's things. to we price, and of more But a of being with broader couple sure that's can consistent, do a a offset foundation prior say doing than that on up I'd we're Andrew, making would but still input on nothing ongoing. level, kind and work I that want And that. calls, on pricing we the of still we lot we've that

Operator

from Ramsey comes question Steven with Research of line Our Group. next Thompson the

Steven Ramsey

more and to side to activity. much volume how are get back? volumes what on North you America the remodel Or coming and Can R&R clarity existing other your Maybe hone depends North on you home looking drivers in go? sales America to confidence on repair on talk where of could for

William Christensen

that I lever. that's have as we said the North roughly different at sales. important Steven, a big And the a are of of couple this the American things -- that's need to retail. retail in carry. think It's of there's elements cash XX% are retail, if There's our think especially look it's I've there, you working couple that partners before, product on. and I

store. if making it's have there the in the So sure you traffic the product is

a a there's second job are resale tight Second our the sure And activity, with do in and there's behind linked doing every linked then the resale. to some and And -- we're of rebalancing that inventories of some of last lever that's making is, trying of they're key couple a growth, availability lot inventory coming for that. stores. And in out of there's that see that's a reality partners I resale, to of another months. job R&R very do better as better

market big relief for partners opportunity the on when areas by people currently I'd that second that, to So that and still already we're to resale call there's there driven cash customers a things professional that, they closer into starts number some growth. one there's professional our those pillar what able the to good interest pro are them if a in. that is a driving And And mortgages is really are. rate will that the And of argue a to together and kick believe R&R really would are the some are being linked as they of where be lot I take retail say market and get where that there, segment. are on of carry well a growth products share that's

is resale to market. the So construction those linked are or new -- the pro not X the distinctly things. And

Steven Ramsey

the CapEx equipment versus or range, demand million $XXX How somewhat or what of up CapEx low versus down? the follow-up other curious a on I'm for $XXX wide is great that swing that end? That's then to would much looking million, Are progress, delivered? there range. it to you're high And the timing color. transformation to factors Okay. move

William Christensen

Yes.

ability deliver. ability one, the number bottleneck execute There it's longer to the things wanted self-fund this -- equipment. great of going transformation, the those the to times timelines deliver also we that's and lines it's certain our and projects. are which and to That about was to spend lead one and to strength of also balance that is ability of to things. We our install key feel on of our the define sheet And So certain organization for currently. obviously,

think So I coming could for the would going we be from a pleased a I say be But because end spend if would the I that's range. different the we're upper to challenge of our we're bottleneck. reality. very organization

Operator

from of B. Alex line Rygiel comes the question Our next with Riley.

Alexander Rygiel

you little more you can about And -- industry about any from a environment? consolidation? opportunities bit little competitive industry bit a talk negative a you impacts that could see Can or talk

William Christensen

Yes.

Clearly, we we landscape. And talk can performance. don't is our in the execute have what to to to competitive improve make comments our we general, front about on really of in So want us focus main competitors. operating about

appropriate I'm the execute puts initiatives. footprint. position our cleaning driving optimizing we're if And on we which a That we the returns, up So will, chain. us that growth delivering and doing totally our that, that that That means that market. in very great focused on supply means and means confident in

less a on focused have it need direct see and the it's we're to delivering on how analyst environment, to we do, and pretty and to I challenging for do us ourselves maybe what get we the one we're there. view going in But market. we're really for there's more think comp clear really investing what equity

We're will be for we're through my up of homework, get that do opportunity, the general. pretty ready come taking but can would that to great very advantage and on the and in a bullish comment think our really time, it clean it's ourselves in So It's market. tough gone and rebound out Europe, we strong. continue a tough to I be so

lot a we still, well So to feel work do. we but of positioned, have

Alexander Rygiel

gross in margin it margin maybe construction the to about versus as gross bit headwind you And multifamily can in little on multifamily? R&R anticipated impact? relates volume then a talk And the weaker new versus rank

William Christensen

Yes.

So Alex, that wouldn't on different across we profit detail pools share that of not we detail typically provide. channels. That's the kind kind of

Operator

line the from of Keith Hughes comes question Truist. final with Our

Keith Hughes

question Europe. is on The

You've in could talked the got could the strategic be on there improvements that this morning about down identifying come you're the Europe be it potential other with Europe going towards? that around for announcement plan. the Or potentially you some Is and actions, we've structure continent? to want changes

William Christensen

Yes.

So I thanks for the would question. -- Keith,

the we plans strong all commensurate stepped We've markets, case. validate Europe. we up strong brands have that the We European yet leadership looking in margins really to actually have hire and the market to quality with we have accelerating forward deliver for but the Gustavo, to said along, of have that transformation really we're and

on. So a to the challenge court ball do and in we've that, to that that's want is accepted, and deliver our we

of of expectations a a headwinds. continued margin broad And little projects improve also So markets. 'XX standpoint. volume we we behind say have development even high in have levels And underperforming appreciation profit I'd the market a the from U.S. in to portfolio they're with

also start it the will So 'XX. be of a at challenging least 'XX,

well we're that So we need that. sure make to prepared for

bit the outside just America." in a for in implications strategic to and ourself North longer the going take will for other Europe fix no of, clearly than So growth, "hey, ready profitable to foundation which we've get Europe arrive, got it's

Operator

for like to call to over closing Armstrong remarks. turn now the would I James

James Armstrong

Thank joining you call today. our for

please be to This If questions, answer. any day. have out, and I follow-up our happy you reach call have ends a would great and today,

Operator

concludes This call. today's

disconnect. You may now

JELD-WEN Holding (JELD) 20 Feb 242023 Q4 Earnings call transcript