JELD-WEN Holding, Inc. (JELD) Tops Q4 EPS by 5c, Revenues Miss; Provides FY19 Adj. EBITDA Views

JELD-WEN Holding, Inc. (NYSE: JELD) reported Q4 EPS of $0.41, $0.05 better than the analyst estimate of $0.36. Revenue for the quarter came in at $1.09 billion versus the consensus estimate of $1.1 billion.

Net revenues for the fourth quarter increased 11.8% year over year to $1.091 billion, bringing full year revenue to $4.347 billion
Net revenue growth for the fourth quarter was driven by a 14% contribution from acquisitions, partially offset by a 2% foreign exchange headwind, while core revenues were unchanged
Net income for the fourth quarter was $39.7 million, an increase of $133.4 million year over year bringing full year net income to $144.3 million
Diluted earnings per share ("EPS") for the fourth quarter was $0.38, an increase of $1.27, and adjusted EPS amounted to $0.41, an increase of $0.15, year over year
Adjusted EBITDA for the fourth quarter increased by $6.5 million year over year to $109.6 million, bringing full year adjusted EBITDA to $465.3 million
Repurchased 2.2 million shares for $41.4 million during the fourth quarter
Outlook for full year 2019 includes net revenue growth of 1% to 5% and adjusted EBITDA of $470 million to $505 million

“I am proud of the sequential improvements in execution that we made during the fourth quarter, delivering 2018 revenue and adjusted EBITDA growth of 15.5% and 6.3%, respectively, and capping our fifth consecutive year of adjusted EBITDA growth," said Gary S. Michel, president and chief executive officer. "While core operating results in the fourth quarter were challenged in certain businesses due to weak volumes, unfavorable mix, and input cost inflation, we delivered core margin expansion in our North America and Australasia segments. We made solid progress in the quarter with the deployment of our business operating system, the JELD-WEN Excellence Model or JEM, driving improved service levels and favorable labor efficiencies. These improvements have strengthened our relationships with channel partners and customers, which will contribute core revenue growth and margin expansion in 2019."

Outlook for 2019

• Outlook includes core revenue growth and margin expansion
• Confidence in 2019 outlook based on pipeline of productivity cost saving initiatives and pricing actions
• Elevated capital expenditures to fund facility rationalization program, which will improve margins and return on invested capital, simplify operations, and drive efficiencies

In 2019, the company sees a mixed demand environment across its segments. For the North America segment, the company expects market growth based on a stable residential repair and remodel backdrop and modest new construction growth. In the Europe segment, moderating economic growth is likely to result in flat end market demand. In the Australasia segment, tightening credit policies are expected to result in moderate contraction in the company\'s primary end market of residential new construction.

The company’s outlook for adjusted EBITDA in 2019 is $470 million to $505 million, compared to adjusted EBITDA for 2018 of $465.3 million. The outlook assumes net revenue growth of 1% to 5%, based upon core revenue growth of approximately 2%. Additionally, the outlook assumes core adjusted EBITDA margin improvement of 40 basis points at the midpoint.

Full year 2019 capital expenditures are expected to be in the range of $140 million to $160 million, compared to 2018 capital expenditures of $118.7 million. Capital expenditures are expected to remain near these levels through completion of the company\'s facility rationalization plan in 2021.

"Based on our strong pipeline of productivity initiatives, significant channel investments, pricing actions, and a stabilizing environment for input cost inflation, we are confident in our ability to meet our financial commitments in 2019," said Mr. Michel.

For earnings history and earnings-related data on JELD-WEN Holding, Inc. (JELD) click here.

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