Form 8-K BEACON ROOFING SUPPLY For: Feb 07

February 7, 2019 5:21 PM

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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 7, 2019

 

 

BEACON ROOFING SUPPLY, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

 

Delaware   000-50924   36-417337

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

505 Huntmar Park Drive, Suite 300, Herndon, VA 20170

(Address of Principal Executive Offices) (Zip Code)

(571) 323-3939

(Registrant’s telephone number, including area code)

 

 

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 Instructions 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))

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 7, 2019, Beacon Roofing Supply, Inc. (the “Company”) issued a press release providing information regarding earnings for the first quarter ended December 31, 2018. A copy of the press release is attached hereto as Exhibit 99.1.

On February 7, 2019, the Company delivered a presentation as part of the webcast for the earnings conference call for the first quarter ended December 31, 2018. A copy of the presentation is attached hereto as Exhibit 99.2.

The information including Exhibit 99.1 and Exhibit 99.2 in this Form 8-K is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The information in this Form 8-K shall not be incorporated by reference into any filing under the Securities Act of 1933, except as shall otherwise be expressly set forth by specific reference in such filing.

 

Item 9.01

Financial Statements and Exhibits

(d) Exhibits

Exhibit Index

 

Exhibit

Number

  

Description

99.1    Beacon Roofing Supply, Inc. press release dated February 7, 2019
99.2    Beacon Roofing Supply, Inc. FY 2019 first quarter earnings presentation dated February 7, 2019


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 thereunto duly authorized.

 

    BEACON ROOFING SUPPLY, INC.
Date: February 7, 2019     By:  

/s/ JOSEPH M. NOWICKI

      JOSEPH M. NOWICKI
      Executive Vice President & Chief Financial Officer

Exhibit 99.1

 

LOGO

Beacon Roofing Supply Reports First Quarter 2019 Results

 

   

Record first quarter net sales of $1.72 billion (53.4% growth year-over-year)

 

   

First quarter gross margin increased 130 bps to 25.3% reflecting existing market improvement and benefits from the Allied integration

 

   

First quarter net income (loss) of $(0.9) million vs. $67.6 million in the prior year; Adjusted Net Income (Loss) of $46.5 million vs. $67.6 million in the prior year

 

   

First quarter EPS of ($0.10) vs. $0.98 in the prior year; Adjusted EPS of $0.60 vs. $0.68 in the prior year

 

   

Record first quarter Adjusted EBITDA of $121.7 million vs. $86.0 million in the prior year

HERNDON, VA. — (BUSINESS WIRE) — Beacon Roofing Supply, Inc. (Nasdaq: BECN) (“Beacon” or the “Company”) announced results today for its first quarter ended December 31, 2018 (“2019”).

Paul Isabella, the Company’s President and Chief Executive Officer, stated: “The first quarter of fiscal year 2019 was headlined by achieving record first quarter highs in both sales and Adjusted EBITDA. Consolidated net sales increased by more than 50% over the prior year, and we saw stabilizing organic net sales trends relative to the previous quarter. Our gross margins showed continued strength, improving by 130 bps and reflecting benefits from the Allied integration as well as disciplined Company and industry pricing behavior. Q1 2019 represented the third consecutive quarter we have produced a positive price-cost relationship, contributing to our highest first quarter gross margin percentage as a public company. We are excited to have reached the one-year anniversary of the acquisition of Allied; the integration continues to go well, and cost synergies remain on track with current expectations. These positive outcomes are underpinned by the fact that our business remains composed of 70-75% repair and remodeling, which is largely demand that is a non-discretionary in nature. We remain focused on returning to positive organic sales growth during 2019 by leveraging our industry leading digital platform and key growth initiatives to drive market outperformance.”

First Quarter

Net sales increased 53.4% to $1.72 billion, up from $1.12 billion in the comparative 2018 period. Residential roofing product sales increased 24.4%, non-residential roofing product sales increased 27.6% and complementary product sales increased 178.9% over the prior year. Existing markets net sales, excluding acquisitions, decreased 1.9% compared to the prior year period, primarily due to weather-related events. The first quarter of fiscal years 2019 and 2018 had 62 and 61 business days, respectively.

Net income (loss) attributable to common shareholders was $(6.9) million, compared to $67.6 million in 2018. Net income (loss) per share (“EPS”) was $(0.10), compared to $0.98 in 2018. First quarter results were positively impacted by price gains across all product lines and improved gross margin performance. First quarter results were negatively impacted by higher operating expenses and an increase in interest expense and preferred dividend payments that were both primarily related to the acquisition of Allied. In addition, 2018 results include a $46.5 million non-recurring net tax benefit resulting from the enactment of the Tax Cuts and Jobs Act of 2017.

Adjusted Net Income (Loss) was $46.5 million, compared to $46.7 million in 2018. Adjusted EPS was $0.60, compared to $0.68 in 2018. Adjusted EBITDA was $121.7 million, compared to $86.0 million in 2018. Please see the included financial tables for a reconciliation of “Adjusted” financial measures to the most directly comparable GAAP financial measures as well as further detail on the components driving the net changes over the comparative periods).


The Company will host a webcast and conference call today at 5:00 p.m. ET to discuss these results. The webcast link and call-in details are as follows:

 

What:   Beacon Roofing Supply First Quarter 2019 Earnings Conference Call
When   Thursday, February 7, 2019
Time:   5:00 p.m. ET
Webcast:   http://ir.beaconroofingsupply.com/events.cfm (live and replay)
Live Call:   720-634-9063; Conf. ID #7106649

To assure timely access, conference call participants should dial in prior to the 5:00 p.m. ET start time.

Forward-Looking Statements:

This release contains information about management’s view of the Company’s future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including, but not limited to, those set forth in the “Risk Factors” section of the Company’s latest Form 10-K. In addition, the forward-looking statements included in this press release represent the Company’s views as of the date of this press release and these views could change. However, while the Company may elect to update these forward-looking statements at some point, the Company specifically disclaims any obligation to do so, other than as required by federal securities laws. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

About Beacon Roofing Supply

Founded in 1928, Beacon Roofing Supply, Inc. is the largest publicly traded distributor of residential and commercial roofing materials and complementary building products, operating over 500 branches throughout all 50 states in the U.S. and 6 provinces in Canada. To learn more about Beacon and its family of regional brands, please visit www.becn.com.

Beacon Roofing Supply, Inc.

Joseph Nowicki, Executive VP & CFO

571-323-3939

JNowicki@becn.com


BEACON ROOFING SUPPLY, INC.

Consolidated Statements of Operations

(Unaudited; In thousands, except share and per share amounts)

 

     Three Months Ended December 31,  
     20181     % of
Net Sales
    20172     % of
Net Sales
 

Net sales

   $ 1,721,676       100.0   $ 1,121,979       100.0

Cost of products sold

     1,286,107       74.7     852,226       76.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     435,569       25.3     269,753       24.0

Operating expense:

        

Selling, general and administrative

     327,693       19.1     193,753       17.3

Depreciation

     17,601       1.0     8,709       0.8

Amortization

     52,021       3.1     18,195       1.6
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expense

     397,315       23.2     220,657       19.7
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from operations

     38,254       2.1     49,096       4.3

Interest expense, financing costs, and other

     38,361       2.2     22,568       2.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before provision for income taxes

     (107     (0.1 %)      26,528       2.3

Provision for (benefit from) income taxes

     786       0.0     (41,068     (3.7 %) 
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

     (893     (0.1 %)      67,596       6.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Dividends on preferred shares3

     6,000       0.3     —         0.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to common shareholders

   $ (6,893     (0.4 %)    $ 67,596       6.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted-average common stock outstanding:

        

Basic

     68,248,020         67,825,430    

Diluted

     68,248,020         69,244,678    

Net income (loss) per share4:

        

Basic

   $ (0.10     $ 1.00    

Diluted

   $ (0.10     $ 0.98    

 

1 

Operating expense includes $8.9 million ($6.6 million, net of taxes) of non-recurring acquisition costs. Interest expense, financing costs, and other includes $3.0 million ($2.2 million, net of taxes) of non-recurring acquisition costs.

2 

Operating expense includes $5.6 million ($4.0 million, net of taxes) of non-recurring acquisition costs. Interest expense, financing costs, and other includes $12.3 million ($8.7 million, net of taxes) of non-recurring acquisition costs. Provision for (benefit from) income taxes includes a $46.5 million non-recurring net tax benefit resulting from the enactment of the 2017 Tax Cuts and Jobs Act.

3 

Three months ended December 31, 2018 amount is composed of $5.0 million in undeclared cumulative Preferred Stock dividends as well as an additional $1.0 million of Preferred Stock dividends that had been declared and paid as of period end.

4 

Basic net income (loss) per share is calculated by dividing net income (loss) attributable to common shareholders by the weighted-average number of common shares outstanding during the period, without consideration for common share equivalents or the conversion of Preferred Stock. Common share equivalents consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock unit awards. Diluted net income (loss) per common share is calculated by dividing net income (loss) attributable to common shareholders by the fully diluted weighted-average number of common shares outstanding during the period. The following table presents the components and calculations of basic and diluted net income (loss) per share for each period presented (in thousands, except share and per share amounts):


     Three Months Ended December 31,  
     2018     2017  

Net income (loss)

   $ (893   $ 67,596  

Dividends on preferred shares

     (6,000     —    
  

 

 

   

 

 

 

Net income (loss) attributable to common shareholders

   $ (6,893   $ 67,596  

Undistributed income allocated to participating securities

     —         —    
  

 

 

   

 

 

 

Net income (loss) attributable to common shareholders - basic and diluted

   $ (6,893   $ 67,596  
  

 

 

   

 

 

 

Weighted-average common shares outstanding - basic

     68,248,020       67,825,430  

Effect of common share equivalents

     —         1,419,248  
  

 

 

   

 

 

 

Weighted-average common shares outstanding - diluted

     68,248,020       69,244,678  
  

 

 

   

 

 

 

Net income (loss) per share - basic

   $ (0.10   $ 1.00  

Net income (loss) per share - diluted

   $ (0.10   $ 0.98  


BEACON ROOFING SUPPLY, INC.

Consolidated Balance Sheets

(Unaudited; In thousands)

 

     December 31,     September 30,     December 31,  
     2018     2018     2017  

Assets

      

Current assets:

      

Cash and cash equivalents

   $ 18,423     $ 129,927     $ 63,827  

Restricted cash

     —         —         1,300,000  

Accounts receivable, net

     881,749       1,090,533       552,703  

Inventories, net

     1,025,310       936,047       603,793  

Prepaid expenses and other current assets

     375,598       244,360       218,718  
  

 

 

   

 

 

   

 

 

 

Total current assets

     2,301,080       2,400,867       2,739,041  

Property and equipment, net

     273,742       280,407       154,687  

Goodwill

     2,489,730       2,491,779       1,251,825  

Intangibles, net

     1,282,242       1,334,366       410,857  

Other assets, net

     1,243       1,243       8,868  
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 6,348,037     $ 6,508,662     $ 4,565,278  
  

 

 

   

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

      

Current liabilities:

      

Accounts payable

   $ 551,940     $ 880,872     $ 315,442  

Accrued expenses

     375,672       611,539       266,049  

Current portions of long-term debt/obligations

     20,315       19,661       14,239  
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     947,927       1,512,072       595,730  

Borrowings under revolving lines of credit, net

     503,216       92,442       —    

Long-term debt, net

     2,497,123       2,494,725       2,000,059  

Deferred income taxes, net

     110,179       106,994       93,451  

Long-term obligations under equipment financing and other, net

     10,689       13,639       20,951  

Other long-term liabilities

     5,532       5,290       2,743  
  

 

 

   

 

 

   

 

 

 

Total liabilities

   $ 4,074,666     $ 4,225,162     $ 2,712,934  
  

 

 

   

 

 

   

 

 

 

Convertible preferred stock

   $ 399,195     $ 399,195     $ —    

Stockholders’ equity:

      

Common stock

   $ 684     $ 681     $ 679  

Undesignated preferred stock

     —         —         —    

Additional paid-in capital

     1,067,711       1,067,040       1,050,389  

Retained earnings

     826,941       833,834       815,782  

Accumulated other comprehensive income (loss)

     (21,160     (17,250     (14,506
  

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

     1,874,176       1,884,305       1,852,344  
  

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 6,348,037     $ 6,508,662     $ 4,565,278  
  

 

 

   

 

 

   

 

 

 


BEACON ROOFING SUPPLY, INC.

Consolidated Statements of Cash Flows

(Unaudited; In thousands)

 

     Three Months Ended December 31,  
     2018     2017  

Operating Activities

    

Net income (loss)

   $ (893   $ 67,596  

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

    

Depreciation and amortization

     69,622       26,904  

Stock-based compensation

     3,457       3,459  

Certain interest expense and other financing costs

     3,024       707  

Beneficial lease amortization

     572       —    

Gain on sale of fixed assets

     (265     (319

Deferred income taxes

     3,201       (44,923

Changes in operating assets and liabilities, net of the effects of businesses acquired:

     —         —    

Accounts receivable

     207,119       151,365  

Inventories

     (90,712     (52,024

Prepaid expenses and other assets

     (131,638     (1,421

Accounts payable and accrued expenses

     (400,616     (191,800

Other liabilities

     246       —    
  

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     (336,883     (40,456
  

 

 

   

 

 

 

Investing Activities

    

Purchases of property and equipment

     (11,688     (7,416

Acquisition of businesses, net

     (163,973     —    

Proceeds from the sale of assets

     401       413  
  

 

 

   

 

 

 

Net cash provided by (used in) investing activities

     (175,260     (7,003
  

 

 

   

 

 

 

Financing Activities

    

Borrowings under revolving lines of credit

     1,298,654       17,402  

Repayments under revolving lines of credit

     (888,225     (20,548

Borrowings under senior notes

     —         1,300,000  

Payment of debt issuance costs

     —         (21,917

Repayments under equipment financing facilities and other

     (1,465     (1,968

Payment of stock issuance costs

     —         (429

Payment of dividends on preferred stock

     (6,000     —    

Proceeds from issuance of common stock related to equity awards

     834       3,781  

Taxes paid related to net share settlement of equity awards

     (3,617     (3,925
  

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     400,181       1,272,396  
  

 

 

   

 

 

 

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

     458       640  

Net increase (decrease) in cash, cash equivalents, and restricted cash

     (111,504     1,225,577  

Cash, cash equivalents, and restricted cash, beginning of period

     129,927       138,250  
  

 

 

   

 

 

 

Cash, cash equivalents, and restricted cash, end of period

   $ 18,423     $ 1,363,827  
  

 

 

   

 

 

 


BEACON ROOFING SUPPLY, INC.

Consolidated Sales by Product Line

(Unaudited; In thousands)

Consolidated Sales by Product Line

 

 

     Three Months Ended December 31,              
     2018     2017     Change  
     Net Sales      Mix %     Net Sales      Mix %     $     %  

Residential roofing products

   $ 732,190        42.5   $ 588,782        52.5   $ 143,408       24.4

Non-residential roofing products

     419,909        24.4     328,971        29.3     90,938       27.6

Complementary building products

     569,577        33.1     204,226        18.2     365,351       178.9
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   
   $ 1,721,676        100.0   $ 1,121,979        100.0   $ 599,697       53.4
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

Consolidated Sales by Product Line for Existing Markets1

 

 

     Three Months Ended December 31,              
     2018     2017     Change  
     Net Sales      Mix %     Net Sales      Mix %     $     %  

Residential roofing products

   $ 515,896        51.7   $ 525,115        51.7   $ (9,219     (1.8 %) 

Non-residential roofing products

     296,700        29.8     302,882        29.8     (6,182     (2.0 %) 

Complementary building products

     184,413        18.5     188,631        18.5     (4,218     (2.2 %) 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   
   $ 997,009        100.0   $ 1,016,628        100.0   $ (19,619     (1.9 %) 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

Existing Market1 Sales by Business Day2

 

 

     Three Months Ended December 31,              
     2018     2017     Change  
     Net Sales      Mix %     Net Sales      Mix %     $     %  

Residential roofing products

   $ 8,321        51.7   $ 8,608        51.6   $ (287     (3.3 %) 

Non-residential roofing products

     4,785        29.8     4,965        29.8     (180     (3.6 %) 

Complementary building products

     2,974        18.5     3,092        18.6     (118     (3.8 %) 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   
   $ 16,080        100.0   $ 16,665        100.0   $ (585     (3.5 %) 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

1 

Excludes acquired branches that have not been under ownership for at least four fiscal quarters prior to the start of the first quarter of fiscal year 2019.

2 

There were 62 and 61 business days in the quarters ended December 31, 2018 and 2017, respectively.


BEACON ROOFING SUPPLY, INC.

Adjusted Net Income (Loss) and Adjusted EPS1

(Unaudited; In thousands, except per share amounts)

 

     Three Months Ended December 31,  
     2018      2017  
     Amount      Per
Share2
     Amount      Per
Share2
 

Net income (loss)

   $ (893    $ (0.01    $ 67,596      $ 0.98  

Acquisition costs3

     47,393        0.61        25,633        0.37  

Effects of tax reform4

     —          —          (46,492      (0.67
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted Net Income (Loss)

   $ 46,500      $ 0.60      $ 46,737      $ 0.68  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

1 

Adjusted Net Income (Loss) is defined as net income that excludes non-recurring acquisition costs, the amortization of intangibles, business restructuring costs, and the non-recurring effects of tax reform. Adjusted net income per share or “Adjusted EPS” is calculated by dividing the Adjusted Net Income (Loss) for the period by the weighted-average diluted shares outstanding for the period after assuming the full conversion of the participating Preferred Stock.

2 

The weighted-average share count utilized in the calculation of Adjusted EPS for the three months ended December 31, 2018 is 77,942,639. This amount is the 68,248,020 diluted weighted-average shares outstanding plus the assumed conversion of 9,694,619 weighted-average shares of participating Preferred Stock, which were excluded from the GAAP net income (loss) per share calculation for the period due to their anti-dilutive nature. The weighted-average share count utilized in the calculation of Adjusted EPS for the three months ended December 31, 2017 is 69,244,678.

3 

Three months ended December 31, 2018 amount is composed of $11.9 million of non-recurring acquisition costs ($8.8 million, net of tax) and $52.0 million of amortization expense related to intangibles ($38.5 million, net of tax). Three months ended December 31, 2017 amount is composed of $17.8 million of non-recurring acquisition costs ($12.7 million, net of tax) and $18.2 million of amortization expense related to intangibles ($12.9 million, net of tax).

4 

Impact of the Tax Cuts and Jobs Act of 2017.

We use Adjusted Net Income (Loss) and Adjusted EPS to evaluate financial performance, analyze the underlying trends in our business and establish operational goals and forecasts that are used when allocating resources. We expect to compute Adjusted Net Income (Loss) and Adjusted EPS consistently using the same methods each period.

We believe that Adjusted Net Income (Loss) and Adjusted EPS are useful measures because they permit investors to better understand changes in underlying operating performance over comparative periods by providing financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments.

While we believe Adjusted Net Income (Loss) and Adjusted EPS are useful to investors when evaluating our business, they are not prepared and presented in accordance with United States Generally Accepted Accounting Principles (“GAAP”), and therefore should be considered supplemental in nature. You should not consider Adjusted Net Income (Loss) or Adjusted EPS in isolation or as a substitute for net income and net income per share or diluted earnings per share calculated in accordance with GAAP. In addition, Adjusted Net Income (Loss) and Adjusted EPS may have material limitations and may differ from similarly titled measures presented by other companies.


BEACON ROOFING SUPPLY, INC.

Adjusted EBITDA1

(Unaudited; In thousands)

 

     Three Months Ended December 31,  
     2018     2017  

Net income (loss)

   $ (893   $ 67,596  

Acquisition costs2

     8,917       5,569  

Interest expense, net

     39,816       23,516  

Income taxes

     786       (41,068

Depreciation and amortization

     69,622       26,904  

Stock-based compensation

     3,457       3,459  
  

 

 

   

 

 

 

Adjusted EBITDA

   $ 121,705     $ 85,976  
  

 

 

   

 

 

 

Adjusted EBITDA as a % of net sales

     7.1     7.7

 

1 

Adjusted EBITDA is defined as net income plus interest expense (net of interest income), income taxes, depreciation and amortization, stock-based compensation, non-recurring acquisition costs, and business restructuring costs. EBITDA is a measure commonly used in the distribution industry, and we present Adjusted EBITDA to enhance your understanding of our operating performance.

2 

Represents non-recurring acquisition costs (excluding the impact of tax) that are included in operating expense and not embedded in other balances of the table.

We use Adjusted EBITDA to evaluate financial performance, analyze the underlying trends in our business and establish operational goals and forecasts that are used when allocating resources. We expect to compute Adjusted EBITDA consistently using the same method each period.

We believe that Adjusted EBITDA is a useful measure because it permits investors to better understand changes in underlying operating performance over comparative periods by providing financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments.

While we believe Adjusted EBITDA is useful to investors when evaluating our business, it is not prepared and presented in accordance with United States Generally Accepted Accounting Principles (“GAAP”), and therefore should be considered supplemental in nature. Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows from operations, or any other items calculated in accordance with GAAP. In addition, Adjusted EBITDA may have material limitations and may differ from similarly titled measures presented by other companies.

Slide 1

2019 First Quarter Earnings Call Exhibit 99.2


Slide 2

Disclosure notice This presentation contains information about management's view of the Company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including, but not limited to, those set forth in the "Risk Factors" section of the Company's latest Form 10-K. In addition, the forward-looking statements included in this presentation represent the Company's views as of the date of this presentation and these views could change. However, while the Company may elect to update these forward-looking statements at some point, the Company specifically disclaims any obligation to do so, other than as required by federal securities laws. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date of this presentation. This presentation contains references to certain financial measures that are not presented in accordance with United States Generally Accepted Accounting Principles (“GAAP"). The Company uses non-GAAP financial measures to evaluate financial performance, analyze underlying business trends and establish operational goals and forecasts that are used when allocating resources. The Company expects to calculate its non-GAAP financial measures consistently using the same method each period. The Company believes these non-GAAP financial measures permit investors to better understand changes in underlying operating performance over comparative periods by providing financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments. While the Company believes these measures are useful to investors when evaluating performance, they are not presented in accordance with GAAP, and therefore should be considered supplemental in nature. The Company’s non-GAAP financial measures should not be considered in isolation or as a substitute for any items calculated in accordance with GAAP. In addition, these non-GAAP measures may have material limitations and may differ from similarly titled measures presented by other companies. A reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure can be found in the Appendix as well as Company’s latest Form 8-K, filed with the SEC on February 7, 2019. | www.becn.com


Slide 3

Company Strategy Update Paul Isabella, President & Chief Executive Officer Introduction Eric Swank, Chief Operating Officer Q1 Results and Outlook Joe Nowicki, Executive Vice President & CFO Closing Remarks Paul Isabella, President & Chief Executive Officer Q&A Conference Call Agenda | www.becn.com


Slide 4

Beacon overview | www.becn.com A leader in key metropolitan markets 544 branches in 50 US states and 6 Canadian provinces* 100,000+ customers with a broad product offering up to 90,000 SKU’s Repair & Remodel fuels market demand (~70-75%) Strong long-term historical performance Sales CAGR = 17.7% Adjusted EBITDA CAGR = 17.3% Adjusted EBITDA Margin Average = 7.6% Rapid growth since 2004 IPO Opened 82 new greenfield locations Completed 46 acquisitions FY 04 to FY 18 = 17.7% CAGR *Branch numbers as of December 31, 2018


Slide 5

Building blocks of growth | www.becn.com MARKET GROWTH NEW BRANCH OPENINGS ACQUISITIONS SAME-BRANCH GROWTH INITIATIVES Delivering share gains through investments in proven and new market growth drivers Outperform market by 2-4% Stable R&R (~70-75% of Sales), Favorable Economy 46 Acquisitions since IPO Continued acquisition evaluation for strategic fit Proven Execution to Continue Source: Company Estimates


Slide 6

Allied integration update | www.becn.com Synergy realization on track for $100M realization in FY19 and $120M in total Network rationalization progressing well…>40 total branches to-date with remaining consolidations to occur over next 1-2 quarters RSA service model implementation underway – activities remain focused on improving customer service and profitability Systems conversions near completion – will be complete by Spring Integrating best practices across entire branch network, including Allied talent


Slide 7

First quarter 2019 highlights | www.becn.com Record Q1 net sales of $1.72B; >53% growth year-over-year Gross margins up 130 bps. vs. prior year Positive price-cost realization for third consecutive quarter First quarter net income (loss) of $(0.9M); $46.5M Adjusted * Record first quarter Adjusted EBITDA* of $121.7M vs. $86.0M in the prior year * See Appendix for reconciliation


Slide 8

Financial highlights | www.becn.com Sales Growth Operating Costs Gross Margin Adj. EBITDA 53.4% Overall Growth / (1.9%) Existing Markets; (3.5%) on same-day basis 24.1% 23.9% 25.3% 24.0% Positive price cost relationship for third consecutive quarter Margin expanded 130bps. vs. the prior year ($M) Adjusted EBITDA* grew over 41% in the quarter 7.1% of Net Sales 7.7% of Net Sales ($M) ($M) ($M) * See Appendix for reconciliation


Slide 9

Fiscal 2019 outlook summary (unchanged) | www.becn.com 1 See Appendix for definitions 2019 Net Sales $7.0 - $7.35B Adjusted EBITDA1 $540 - $610M Adjusted EPS1 $2.90 - $3.35 Net Sales ($B) Adjusted EBITDA Adjusted EPS ($M) ~12% growth ~19% growth ~16% growth


Slide 10

summary | www.becn.com Solid top line growth…record Q1 net sales of $1.72B; >53% growth year-over-year Highly attractive market with steady repair & remodel (historically 70-75% of net sales) Affirmed fiscal 2019 Guidance Remain focused on organic growth with several growth initiatives Investments in our people Technology investments Expanded product breadth and depth New customers and markets Continuation of successful Allied integration Commitment to de-leveraging…available free cash flow to pay down debt


Slide 11


Slide 12

Appendix | www.becn.com


Slide 13

Reconciliation: Adj. Net Income & Adj. EPS | www.becn.com Adjusted Net Income (Loss) is defined as net income that excludes non-recurring acquisition costs, the amortization of intangibles, business restructuring costs, and the non-recurring effects of tax reform. Adjusted net income per share or "Adjusted EPS" is calculated by dividing the Adjusted Net Income (Loss) for the period by the weighted-average diluted shares outstanding for the period after assuming the full conversion of the participating Preferred Stock. We use Adjusted Net Income (Loss) and Adjusted EPS to evaluate financial performance, analyze the underlying trends in our business and establish operational goals and forecasts that are used when allocating resources. We expect to compute Adjusted Net Income (Loss) and Adjusted EPS consistently using the same methods each period.   We believe that Adjusted Net Income (Loss) and Adjusted EPS are useful measures because they permit investors to better understand changes in underlying operating performance over comparative periods by providing financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments. While we believe Adjusted Net Income (Loss) and Adjusted EPS are useful to investors when evaluating our business, they are not prepared and presented in accordance with United States Generally Accepted Accounting Principles (“GAAP”), and therefore should be considered supplemental in nature. You should not consider Adjusted Net Income (Loss) or Adjusted EPS in isolation or as a substitute for net income and net income per share or diluted earnings per share calculated in accordance with GAAP. In addition, Adjusted Net Income (Loss) and Adjusted EPS may have material limitations and may differ from similarly titled measures presented by other companies.


Slide 14

Reconciliation: AdjUSTED EBITDA | www.becn.com Adjusted EBITDA is defined as net income plus interest expense (net of interest income), income taxes, depreciation and amortization, stock-based compensation, non-recurring acquisition costs, and business restructuring costs. EBITDA is a measure commonly used in the distribution industry, and we present Adjusted EBITDA to enhance your understanding of our operating performance. We use Adjusted EBITDA to evaluate financial performance, analyze the underlying trends in our business and establish operational goals and forecasts that are used when allocating resources. We expect to compute Adjusted EBITDA consistently using the same method each period. We believe that Adjusted EBITDA is a useful measure because it permits investors to better understand changes in underlying operating performance over comparative periods by providing financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments. While we believe Adjusted EBITDA is useful to investors when evaluating our business, it is not prepared and presented in accordance with United States Generally Accepted Accounting Principles (“GAAP”), and therefore should be considered supplemental in nature. Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows from operations, or any other items calculated in accordance with GAAP. In addition, Adjusted EBITDA may have material limitations and may differ from similarly titled measures presented by other companies.


Slide 15

Reconciliation: Existing Markets OpEx to Adj. OpEx | www.becn.com Adjusted Operating Expense is calculated by removing the impact of non-recurring acquisition costs and amortization of intangibles from existing market operating expense as reported on a GAAP basis. Non-GAAP adjustment totals are detailed as follows: FY19 adjustments are composed of $8.9M of non-recurring acquisition costs and $12.8M of amortization FY18 adjustments are composed of $5.6M of non-recurring acquisition costs and $15.5M of amortization We believe that non-GAAP measures are useful measures because they allow investors to better understand changes in underlying operating performance over comparative periods by providing investors with financial results that are unaffected by cyclical variances that can be driven by items such as investment activity or purchase accounting adjustments. While we believe that that non-GAAP measures are useful to investors when evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared and presented in accordance with GAAP. You should not consider this measure as a substitute alongside other financial performance measures presented in accordance with GAAP. In addition, non-GAAP measures may have material limitations and may differ from similarly titled measures presented by other companies.


Slide 16

2019 Guidance Reconciliation | www.becn.com 2019 Adjusted EBITDA Outlook 2019 Adjusted EPS Outlook

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