GMS Inc. (GMS) Reports In-Line Q4 EPS, Revenues Miss

GMS Inc. (NYSE: GMS) reported Q4 EPS of $0.65, in-line with the analyst estimate of $0.65. Revenue for the quarter came in at $635.8 million versus the consensus estimate of $673.42 million.

Fourth Quarter 2018 Results

Net sales for the fourth quarter of fiscal 2018 ended April 30, 2018 were $635.8 million, compared to $615.0 million for the fourth quarter of fiscal 2017 ended April 30, 2017.

Net income of $9.9 million, or $0.24 per diluted share, decreased by 30.5% or $4.4 million compared to $14.3 million, or $0.34 per diluted share, in the fourth quarter of fiscal 2017. Adjusted net income of $23.5 million, or $0.56 per diluted share, decreased $2.4 million, compared to $25.9 million, or $0.62 per diluted share, in the fourth quarter of fiscal 2017.

Mike Callahan, President and CEO of GMS, stated, “We delivered a solid fourth quarter capping off a successful fiscal 2018. Subsequent to quarter end, we completed the acquisition of Titan, which strengthens GMS’s position as the market leader in wallboard distribution in North America and provides an additional platform with multiple levers to drive profitable growth. We were also pleased to deliver record sales for a third consecutive year and achieve our target of gross margin in excess of 32.5% for fiscal 2018.”

Mr. Callahan continued, “Looking ahead to fiscal 2019, the markets that we operate in remain healthy and we are encouraged that May sales increased 7% over last year as we finally started to experience favorable weather trends. We also initiated a strategic cost reduction plan in May of this year to improve our operational efficiency and demonstrate our strong commitment to expanding our margins, while continuing to invest in the areas of our business that we believe will provide the best return for our shareholders, business partners, and employees. Excluding one-time, pre-tax severance related charges in the range of $4.1 to $4.6 million that we expect to record in the first quarter of fiscal 2019, we anticipate that the actions we have taken will generate payroll related and other cost savings of approximately $20.0 million on an annual basis. We will also continue to focus on successfully integrating Titan and look forward to implementing best practices across the combined organization to further expand total company margins over time. I am excited about the overall strength of our business and confident in our ability to deliver another year of record sales and Adjusted EBITDA in fiscal 2019.”

For earnings history and earnings-related data on GMS Inc. (GMS) click here.

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