JBI - Earnings call transcript Q1 2024 | Janus International Group, Inc.

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Operator

Hello, and welcome to Janus International Group First Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to Ms. Sara Macioch, Senior Director, Investor Relations of Janus. Thank you. Ms. begin. may you Macioch

Sara Macioch

Anselm our can this morning. and earnings I our all our am Jackson; the section Financial be have found that Please of support website Officer, operator, that issued presentation earnings of a Chief joining conference Ramey in Officer, Chief posted our in call. joined release at and this We thank seen you, hope for you you our Executive Wong. note we Thank have today also call, janusintl.com. which Investors by

by the that I risks call statements uncertainties from differ Before Exchange for like forward-looking goals, forecasts Please are we the results. our variety begin, control. many company's filings would and prospects our those reasons, which see that Commission are affect describing include statements identify Securities beyond to future of plans, and with of Any actual remind statements. our results assumptions you that expectations, principal projections, statements. recent could and today's which may Please forward-looking our strategies, business, beliefs, may and forward-looking made such note anticipated a the

it by forward-looking made. is available We to obligation update statement publicly is and speaks this based us to the during and assume when any of forward-looking any made date only on no currently us call statements information as only

to today, directly including filings adjusted these adjusted GAAP we addition, their measures EBITDA, EPS. providing and our will certain In adjusted see comparable reconciliation for release be measures discussing margins, most of measure. financial income Please adjusted non-GAAP non-GAAP EBITDA a net and or

the guidance business. and the for provide continue your At turn an today's of a point, Ramey thoughts, open some will this questions. On Anselm closing XXXX Ramey. shares our up will we with financial and over Ramey overview I of call call discussion to will our results before call,

Ramey Jackson

Thank Sara. you,

the line our momentum built established at start a year, in deliver first a solid Janus the in busy to with was as to expectations. one was quarter XXXX upon we The that one

Janus and day. team dedication the consistent their in effort, always, we EBITDA delivered as like expectations every that with a show financial continued adjusted at thank on do As our employees increase everything results first quarter, to X% is for they hard We work, and our a up professionalism revenue. I'd was including X.X% in

the over strong cash XX-month $XX Our generation of trailing since end continued free we to of flow our of a first adjusted million, the record record stated down cash Xx. as conversion drove at target delivered year-over-year another to net free of low cash below in X.Xx, the XXX%. with This quarter income rate of of range leverage X.Xx long-term Xx net going and quarter public

very us in in allocation generation put cash our strong sustained position to been. Our and activities capital flow active be a we have

quarter, quarter paydown During repurchased loan. first to lien first shares. $XX.X made X over of million subsequent million repriced we term a voluntary end, our the and we both And the

services. key M&A focusing commercial, and of explore to continue on self-storage, We technology opportunities areas

and timing. with comprehensive total out smooth and for X X/X percentage we New revenue and of of with our each Replace providing consists self-storage sales to of up helps self-storage segments solutions is project in business X higher which the X our sales channel, roughly channels, margin largest makes Restore, the Our Construction specifics report lumpiness self-storage of commercial even And of discussion combined other segments, given profile EBITDA RX, or Rebuild, while the noise across quarterly the these across along channels. our similar

greenfield last XX%, basis, favor total the which focused investment several continue driven on capacity, in self-storage was construction. of on quarter new XXXX, to Industry self-storage first For by combined up sites. quarters over the has a fundamentals

certain Our sales The period. decline in results demand was channel a reflected XX.X% for Commercial first continued lines. Other compared in the quarter and ago year product the down to

on to to our side. continue potential order innovate commercial We and broaden the reach markets end various untapped access to in

we hardwired potential top X.X%. about installed a a low to very increased system. innovative voltage April, at cloud-native as there the decline, powerful and year-end number suite is our a XXX,XXX the during to from we announced Despite the product excited newest access. and had representing benefits. In access with Entry our mobile software inside well power to Noke margins. units sleek, compatible of early see lock customer-friendly Smart addition solutions lineup, as pairs an with Noke our The of we sequential our XXXX are has that's of strong growth XXX,XXX app of Noke, remote the opportunities another year-over-year which portal number we line for Hardwired Smart Locking the Ion, smart yet Magnetic, improve quarter, of uses inside-the-door the ease It door

of build on beyond. the we expand all expansion capabilities Noke as drive working additional accelerated our XXXX in value In position step customers' across momentum. capture long-term to excited share stakeholders and our strong are next to of in market our to the of look and about represents for to We our create look Ion start XXXX adoption we of portfolios. our to summary, forward

overview our of turn to for updates further to along Anselm? guidance. our With that, XXXX with results, the I'll Anselm call over

Anselm Wong

Thanks, Ramey, and everyone. good morning,

capital and year our line stated, are results a start top progress quarter the allowing as substantial included off expansion program. Ramey us first margin our to we make As cash generation, to growth, to strong good balanced allocation on

the numbers. me let into dive Now deeper

In quarter as decline prior self-storage conversion year. our quarter XX.X% a compared Together, was more its a offset self-storage, year Within in strength growth higher than compared customers retail-to-storage of as the was momentum commercial as X% the to decline new XX% million total for continued prior consolidated the of RX sales quarter the other up in XX.X% the self-storage business $XXX.X channel. first for as add a was the quarter. to continue and revenue in with activity capacity. of construction new quarter, result to greenfield up our in

America, was driven partly entirely North decline a in international. by growth by self-storage Total offset

Commercial Other a in first saw in for product shift demand driven the Our certain decline and XX.X% continued by lines. segment quarter,

a mix offset impact operating in a continued quarter declines First ago compared costs prior for to of the channel X.X% $XX.X performance the up geographic was This profitability segment sales as adjusted of an XXX up year partially is and of million by improvement growth. positive business material This margin XX.X%, and in solid quarter. points costs, EBITDA EBITDA from scales the produced result of year period. adjusted increased basis

benefit XX% over America, revenues than our the sourced margin regard geographic higher from international business. are which With a mix, segment our profile to has margin of North from

revenues international down recession and the corresponding driver quarter, on The our XX.X%. first this [indiscernible] decline decisions. the of launch was project primary steep largest international impact During entering a saw been market

We are in encouraged projects but market being fundamentals rather persists. as that make hold canceled self-storage are put attractive on underlying that not that the

the lower overall margin favorable contributed international business's improvement. to the profile, company's to mix this Due margin adjusted and EBITDA the

covered, higher impacted million, net channel favorable the diluted $X.XX. For improvement Adjusted the income of already in income produced was quarter the per and earnings revenue drivers a of year-over-year mix. segment XX.X% geographic and including by quarter, share first and adjusted net $XX.X we adjusted sales

Capital robust down generation cash of the for to demonstrate were operating profile from business. the cash the million, $X.X of million $X.X first generated continuing $XX.X expenditures the in activities quarter from of We quarter million, XXXX.

resilience free and our results cash flow profile the of the of business. strength Our reflects our financial

cash cash $XXX.X flow generated net flow basis, we For the We cash a the million the of sheet. free of quarter of quarter, including conversion with $XXX on first of adjusted balance XX-month trailing million. a On liquidity, million represented income total free XXX%. $XX of finished this

X.Xx the at Our X.Xx was year our total X.Xx. $XXX.X net and is improvement was million, debt quarter and This ago period of an outstanding leverage long-term end sequentially. versus

of to balance B+ position our outlook strength million pursue targets, The a all long-term our business debt. from continued to address execute B and sheet credit model, rating of our improved resolution material the and upgrade rating March, credit liquidity, received program S&P of outlook; and in from repurchase $XXX governance strength in our upgraded balance against revised combination April, sheet to their to positive BaX cash generation Moody's and and a M&A puts we a weaknesses, with in from BX positive. strong On us

million During rate by taxes basis SOFR+XXX. excise and the lien shares quarter, $XX.X we first our and repriced subsequent for points our which we XX made and million from quarter, reduced X.XX including SOFR+XXX+CSA to first repurchased loan, voluntary interest term $XX.X of prepayment commissions the both a to million,

revenues into we and XXXX our the our Now and are our markets, guidance EBITDA. reiterating for on have end guidance. moving visibility first Based quarter to adjusted results we

$X.XXX we $X.XXX billion, in continue the revenue of to expect XXXX. range to versus representing growth be organic at X% of Specifically, to the midpoint billion

EBITDA range midpoint adjusted EBITDA At be of to expect an the million. at versus million to and adjusted the the this XX.X%. margin prior increase a represents We year X.X% midpoint, $XXX of in reflects $XXX

expect year. front Commercial our our at back segment, and total normalize and expect year. facility. new operations to ramp grow Other, the conditions stronger of throughout as expect growth Poland return than In In the be we a we of the the to We half self-storage International continue the we year market the half back to in up our

seasonality normal comprised XXXX that quarter to Ramey our last first the case. remarks. in for quarter on fourth third and larger second to turn that now will over to the where return of you. remains a the Thank we his to mentioned Ramey? We closing I call portion the and revenues compared call expect and

Ramey Jackson

work Anselm. built year you multiple off a and have as allocation on start done also paying capital Thank executing solid the momentum had to the we have again, we fronts. while hard are we The

on Our Anselm the guidance remain objectives out. intact long-term just based reiterated laid

We performance. year to another of strong expect XXXX feature

today. in with customers the capabilities are leader self-storage of to help ever-improving self-storage industry We address prevalent differentiated our the undersupply capacity offerings, solutions

improved and have best-in-class and growth, Those offerings outstanding margins strong EBITDA top us organic acquired generation. cash line to allowed deliver

for execute now to powder lines Thank opportunities. our again stakeholders. forward intend please. as of the joining pursue to I our and Q&A, we continuing can drive the expertise long-term our have look dry us. you shareholder up and We for value-enhancing momentum for all sheet beyond we on positive in to continue open balance Operator, and creation value XXXX accretive to

Operator

[Operator Jeff first question is from Hammond with Capital KeyBanc Instructions] Our Markets.

Jeffrey Hammond

to of seeing was new that there if was pipeline. just forward the hit backlog kind or if backlog down construction Wondering on drew strong. there? how you're pull Clearly, and want really I any

Ramey Jackson

talk Yes, great new changed self-storage remains there. pipeline remains optimistic. When strong, very strong. and construction, question. Backlog about we're you Nothing's backlog

Jeffrey Hammond

on. of the or to And just I'm carport tough year and commercial shed wondering, then the that of thinking X% is commercial, Okay. revenue going Great. on comps, more And there for the piece something a midpoint within just comping lingering how growth this about maybe full basis? is you're guide, meaningful think kind business what

Ramey Jackson

it's talk continuation guide. segment and Anselm look, let sheds. a But about I'll Yes, I around the of carports think the

channel not you want we But As strategy. go-to-market those you about talk that do it... lines. visibility know, in do feel in in a commercial have segment into But because softness we if addition general of our the sector there's to do kind the of like Anselm,

Anselm Wong

to be because is see I below visibility strength some like think and there, instability a Ramey of enough way low seen seem I see, that seems you piece would we guide will I there, see still there. still of there. down I I But there. steel If said, strength bit the shed Jeff. the break uncertain think softer, there holding the rolling self-storage right Yes, our as at other the of still the parts is it that QX. look the now, storage it's softness but from view I offset But visibly not the the think still is in to kind And and point be details the carports if you've

through a it's matter So getting just piece. that of

Ramey Jackson

and right execute Yes. a that to also segment. enhancement. spot be going and the We an We've to grow in We're product continue is talked And initiatives there We're still then got in just last thing of uptick our me. bullish plan the to that plan. continue great about about geographic some in macro. for when to expansion

build So I and like we're to a spot, line in continue feel we're up. good we'll that --

Jeffrey Hammond

but last -- speak to were I of dynamics. conversions certainly of just the kind know playing a you think you that's dynamic maybe speak abated kind then through. have bit saying little have one, And I RX consolidation

what Just you there? are seeing

Anselm Wong

Yes.

we've no the I different the for new think why been I at if we quarters talking. Jeff, but constructions you have seeing you not still still think demand in than there. that look that to prior RX, And meet we're that see conversions, the many the there's strength the opportunities that's

terms some from in that I coming starting we're the think consolidations slowly that. of orders to see of the

mentioned just working helping slowness some them because of there we of starting the Again, some of of in that that had customers are issues is integration little terms through a with. that we're our that

So think just see timing still in that trickle it's seeing some orders there. I of more now. we're to we're starting But those

Operator

is from question Moore CJS Daniel next with Securities. Our

Dan Moore

tend Obviously, the think and table construction. as That new interchangeably XX% growth jumps to of new you within RX about construction self-storage. in off work terms said,

talk expect RX construction is specific there coming the growth of about that expanding continue And where outpace for geographies do year? to we Are Just faster. are from? remainder that the new to

Ramey Jackson

in I add how as it's remain markets in continuation a of brought data, agnostic been, robust. you what we've that terms secondary Yes. it's But know, you construction of supply. topic new tertiary over Great of printing. those that I'm glad question, been totally than of X.X customers Obviously, terms the has different we're up. years our and mean, some third-party

So listening our and lot to visibility I supplied. but are of still from under a that our there's markets concern, understand the customers,

cost that's business. is growth and self-storage you're where long-term and cost capital, construction of seeing And our elevated notwithstanding a obviously,

strong of happening investing what's the is long-term in the market still future today areas, they're so and And asset. in end is certain the

continuation again, markets of the under that So go kind under supplied just of the a radar. are that

Dan Moore

environment, remain of and mixed appreciate that geographic obviously, how of and product color kind in a front, light the all macro plays margin the the I mix and on in. on And impressive

at seasonally Just for of versus the of within XX-ish as that year stronger we kind cadence little the cadence about remainder QX a percent to of and how the QX. should look bit we midpoint. of well think the margins guide the as confines know as QX I the QX,

Anselm Wong

our think that's in we step there. up Dan, in No, QX, benefit larger to because how have like the so you said, QX, QX the it about we usually is volume get

about always of one productivity always talk think looking is I that the well. as for we things at opportunities we're

for our looking So always factories opportunities. are

that's is factory equipment speed last piece Poland in with of finally installed to the up Our just Europe there. getting

terms So of improvement I in think we're still margin looking business. for at bullish the

Dan Moore

lot buying And then it. targets capital well left. stock with just of allocation, terms capacity Got in leverage back of and obviously, below a your

and dialogues kind fruition talk around maybe Just that's the about more you're can seeing and you the next whether pipeline that XX M&A, how of come level opportunity spreads bid-ask XX, of could to in the months?

Anselm Wong

there. lot Yes, still opportunities out a of

I areas we're point think all different we're an excited about for that from of view. looking the M&A

I opportunities versus what has think been that we opportunities, changed I are we've I for a a -- for I balance of the But just it are for acquisition there. much think be. a an from priced lot we just of terms flexibility think a asking cash reasonably think in don't capital there's need are be right, different just the the ones There general, opportunistic of in there's when generating in doing would I out allocation, opportunities some the still multiple. still that of there. we're that terms great and gives higher all -- that areas just you're us seeing looking to then to we're in think And

Operator

with Lovallo UBS. is John Our Instructions] next question [Operator from

Unknown Analyst

touched for on actually is This know kind you this Matt I guys John. Johnson on of already.

point Just put on a finer it.

you within the a construction versus about sales year your year new I commercial of you versus full RX on X%. midpoint full that? How are guys basis think at of outlook, have thinking

Anselm Wong

Yes.

showing kind together. that's the of storage think we I started why

from that in going piece. But really point that is least hopeful still we that stability the immediate now, the and just back At stay can again, And feel we're agnostic leveling what in RX we storage from what from that strong it's a overall, goes the out think is terms view, come I see, it of there. construction an I from we're again, of that that in how between there. of thing right that, opportunities we new high level opportunity still and still there's strength backlog off either think, one. fairly tell conversion will to

Ramey Jackson

But quickest high XXs, the back terms because come really was just Yes. than think saying just and issues could else as coming I the online. is mean, And possible, bring more conversion it's and I occupancy way pandemic normalization. about capacity we're what capacity normalization online it permitting to the on needed on piece, of just seeing, created to rates to we're that in this, mid- as and of anything quickly in record operators it's XXs, the high

so levels. just not at it, about pandemic we good of feel those And kind

Unknown Analyst

could it. cost then And Got touch a on just little if bit. input I

I year-to-date. think steel meaningfully pretty prices are down

just the the are about thinking price/cost between So this guys of you rest through dynamics how year?

Anselm Wong

following. kind more it's Yes. terms but Steel, actually, been been It's year-over-year. beginning, of how at we've looking it's down stabilized from in of

but good that thing going is to always it's bit be it's volatile, a it the stable. more actually about So

ability that So through we one not that there's we to of there. just to because better do environment not I do it's won't but price that have think have tougher price, a do it's a bring do where the to always creates to lot it, have any time we a you

area be from a us market think where So it holds bit it view. if I think it kind now, point for stable in more I is that the of right of will

Operator

with from Brad is Hewitt question Wolfe next Our Research.

Bradley Hewitt

REITs of public seeing backlog things. And year, that a of how new down are your pipeline new this you construction? from on does backlog and recently? you're talked what to some kind perspective. I has But of perspective, curious development a on visibility have think side curious far just the So the particularly extend seeing from what guys trended hear maybe how

Anselm Wong

like think I Sure. said seeing that And and build there operators in and is a something And and lot are The recent at mom-and-pop areas. we're there. pipeline look Yes. ones say, and are the -- that think, tertiary is. been seeing long And if think backlog just now." that, look is for are of what term. just that's they of I here don't would cycle be current a stop I've they're where of the just those lot say, not new that at rates let's reflection we're that building good hey, seeing I we've holding at the looking is strength just that are the cycle still looking these they're bit been No, and long reviewing the for that the Ramey term "Hey, guys still orders and a It's looking like now, a the this rate high where those is kind the we're the those a look segment still earlier, business. is might long And the, say, return market some I you of it's still opportunity. long at Ramey peak. but -- for us the a of it

think So of backlog the I and seeing up. pipeline hold we're that's where kind to

Ramey Jackson

the customer kind Yes. as REITs to remind XX% we base view of And institutional the represents of institutional market. just about that -- you, and

visibility share market so really Americas. And entire the our our of is considering in the market reflective

as disconnect kind that's well. like the feel perhaps we is where So of .

Bradley Hewitt

guys then line? expecting helpful. the are do year just terms revenue think potential of That's top perspective. what curious about acceleration this of in timing from a Great. And And Okay. how a you on you there maybe the Noke,

Ramey Jackson

The Ion, us very in I flexibility innovate. that terms proud to our optimistic. and team. Yes. release latest the what get around our connected of XXX,XXX customers on pricing. proud, We We're listening devices, super continue be gives more more Look, to on customers. gives need. flexibility us actually It It of we couldn't more offering

We've optimistic. very feedback. we're yes, so And great got

refine. continue to We

stability. continue better We get to on

continue to there. We honestly just innovate

up in got of inflection really terms predict adoption. anything point. an to and all that, but it in accelerate customer offering terms can't just bullish refining I set really things else? engagement the to right super we're So you the Anselm, of doing

Anselm Wong

that know, but said product. middle Yes, don't is the in opportunity think you brings product. launch stable we'll it we a Brad, of of don't more the product the customers piece, of product the hardwired to as Noke we with our And a terms beta is and product. because in -- what hopefully, new Ramey optionality on a testing I we're year for disclose in bullish it the more have later battery just lot versus that because just a We're

Operator

Moore question Our a CJS. Daniel next is from with follow-up

Dan Moore

Thank let go a Yes, question. couldn't we without call Noke again. the you

I'll So since one deeper. step that go was covered,

it's you the or Just an but how are think sense relative for relative from growth for obviously, Just the X in as this versus early, you trying or move your Noke potential could Ion uptake? And X? revenue big to do differential Any lower forward? a of recurring we bigger terms the I Noke perspective. costs entry-level what faster opportunities to expectations be there? as get think about know

Anselm Wong

optionalities. up It of lot Yes. a opens

X point this customers of either one, different a lot Ion. segments which the still time, a at the more versus of our Ion Ion, a [indiscernible] of opportunistic, it some the that the on is So set features. X Noke makes But allows Noke the might bit feature because just bit is for same on want what optional because optionality the recurring all it are Noke in Noke not

it So can is offers the different them model, the if they get like the features what this install they And actually about our what to as after on customers. fact, is also we new allows they and please. features product add building the this for even which base base add

Operator

I the would for remarks. to back over Ramey to closing session. conference the our We like of have reached end Q&A turn

Ramey Jackson

Janus your to look vote progress Annual our up forward Have day. you updating you, encourage you feedback. to on Meeting We'd your again remind in Thank on coming We the support forward joining and to great appreciate future. your and everyone, XX. a Shareholders of of June of us today. shares for Yes. to International you like look our We

Operator

conclude will today's This you. Thank conference.

your disconnect at may You your time, participation. you this and lines thank for

Janus International (JBI) 9 May 242024 Q1 Earnings call transcript