The operating cash flow fell significantly in Q1 2024 due to a marked decrease in net income—from **$333,786 thousand** in Q1 2023 to **$258,781 thousand** in Q1 2024—and adverse changes in working capital. Specifically, there was a shift in inventories from a cash inflow of **$101,745 thousand** in Q1 2023 to a cash outflow of **$(126,707) thousand** in Q1 2024 and a larger cash outflow in accrued liabilities (from **$(174,994) thousand** to **$(222,715) thousand**). These factors, along with other adjustments in receivables and current assets, contributed to the overall significant decline in net cash provided by operating activities.  **[0000950170-24-054249_bldr-20240331.htm:2]** **[0000950170-24-053918_bldr-ex99_1.htm:6]** 

Why did Operating Cash Flow fall significantly in Q1 2024?

The available documents do not provide a definitive explanation for what drove the **notable rise in Operating Cash Flow in Q3 2024**. While one document provides the operating cash flow figure of **729,958** for Q3 2024  **[0000950170-24-121436_bldr-20240930.htm:3]**  and another discusses changes over a nine‐month period (notably mentioning factors such as **lower net income** and **timing changes in accounts payable and receivable**)  **[0000950170-24-121436_bldr-20240930.htm:3]** **[0000950170-24-121436_bldr-20240930.htm:20]** , none of the documents explicitly detail the specific drivers for the increase in the Q3 2024 period alone.

What drove the notable rise in Operating Cash Flow in Q3 2024?

The jump in capital expenditures from **$340,152 thousand in FY 2022** to **$476,335 thousand in FY 2023**—an increase of approximately **$136,183 thousand**—is noted in the documents. However, while the increase may reflect investments in areas such as rolling stock, equipment, facility expansion, and operational improvements (as hinted by the **2024 capital expenditure guidance** of between **$400 million and $500 million**), the documents do not provide a detailed explanation for the higher spending in FY 2023.  **[0000950170-23-004939_bldr-20221231.htm:63]** **[0000950170-24-018584_bldr-20231231.htm:66]** 

Why did capital expenditures jump in FY 2023 compared to FY 2022?

The repurchase activity in Q1 2024 almost vanished **because the company dramatically reduced the volume of shares repurchased**—buying only **0.1 million shares at an average price of $202.67** compared to **7.5 million shares at $83.17** in the previous year—combined with **strategic capital allocation** priorities under its newly authorized **$1 billion share repurchase plan**.  **[0000950170-24-053918_bldr-ex99_1.htm:0]** **[BLDR_3386751_6]** **[0000950170-24-054249_bldr-20240331.htm:3]** 

What caused the repurchase activity to almost vanish in Q1 2024?

The dramatic swing in Q1 2024 was primarily driven by an **improvement in financing activities**. Builders FirstSource recorded **$465,168 thousand** in financing cash inflows, largely due to **$987.5 million net proceeds from the issuance of 6.375% senior notes due 2034**, which more than offset the **$464.0 million net payments** on the revolving credit facility. Additionally, while operating activities generated lower cash of **$317,187 thousand** (down from **$654,381 thousand**) and investing activities saw less cash used (**$(151,036) thousand** compared to **$(178,860) thousand**), these factors further contributed to the positive net change in cash and cash equivalents of **$631,319 thousand** in Q1 2024.  **[0000950170-24-054249_bldr-20240331.htm:2]** **[0000950170-24-054249_bldr-20240331.htm:17]** 

How did the net cash change swing so dramatically in Q1 2024?

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The **cash surge in Q1 2024** was driven by several factors. Builders FirstSource raised a substantial amount by **issuing $1 billion** of senior unsecured notes due 2034, which provided a major cash inflow. Additionally, the company made **$464 million** in net payments on its revolving credit facility, effectively reducing its outstanding balance. This was further supported by **lower cash used in investing activities**—with investments in acquisitions and property/equipment purchases being reduced—and by generating **$317.2 million** in cash from operating activities, even though this was lower than the previous year's result. These combined factors contributed to the significant uptick in cash and cash equivalents.  **[0000950170-24-054249_bldr-20240331.htm:17]** **[0000950170-24-054249_bldr-20240331.htm:2]** 

What drove the cash surge in Q1 2024?

The significant increase in cash in Q3 2024—rising from **$66,156 thousand** at FY 2023 close to **$328,103 thousand**—resulted primarily from a combination of factors. **Strong operating cash flow** generated **$729,958 thousand**, largely due to improved working capital dynamics, which outweighed the cash used in investing and financing activities. Additionally, the impact of **lower cash outflows in investing activities** (net cash used of **$(219,259) thousand**) and the effects of financing activities led to a net positive change of **$252,534 thousand** in cash. These elements combined to drive the substantial increase in cash during Q3 2024.  **[0000950170-24-121065_bldr-ex99_1.htm:10]** 

Why is cash significantly higher in Q3 2024?

The **increase in Total Assets** in Q1 2024 was primarily driven by a significant rise in **cash and cash equivalents**—boosted by strong financing activity and proceeds of **$1 billion** from long-term debt issuance—which jumped from **$66,156 thousand** to **$697,475 thousand**. Additionally, **inventories** increased to support operational needs, while **goodwill** rose due to acquisitions, and **other assets, net** expanded, all contributing to the growth. These gains, however, were partly offset by a decrease in **intangible assets, net** as a result of amortization.  **[0000950170-24-053918_bldr-ex99_1.htm:7]** **[0000950170-24-054249_bldr-20240331.htm:2]** **[0000950170-24-053918_bldr-ex99_1.htm:7]** **[0000950170-24-054249_bldr-20240331.htm:7]** 

What factors contributed to the Total Assets increase in Q1 2024?

Builders FirstSource’s long-term debt increased in Q2 2024 primarily due to the issuance of **$1.0 billion 6.375% Senior Unsecured Notes due 2034** on February 29, 2024. These notes were used to repay part of the revolving credit facility, which substantially reduced its balance, but the increase from the newly issued notes outweighed this reduction, resulting in a net rise in long-term debt.  **[0000950170-24-091788_bldr-20240630.htm:9]** **[0000950170-24-121436_bldr-20240930.htm:10]** 

Why did Long-term debt rise in Q2 2024?

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The drop in net sales in FY 2023 was driven primarily by a **17.3% decrease in core organic sales** and an **11.1% decrease due to commodity price deflation**, which were compounded by a **slowdown in single-family housing starts**. Although there was a **3.6% increase from acquisitions** that partially offset these declines, the significant reduction in organic sales and adverse market conditions were the main factors behind the decline.  **[0000950170-24-018584_bldr-20231231.htm:64]** **[0000950170-24-018584_bldr-20231231.htm:53]** **[0000950170-24-018584_bldr-20231231.htm:71]** 

What drove the drop in Net Sales in FY 2023?

The sharp decline in FY 2023 net income was driven by several key factors. **Lower net sales** decreased by **24.7%**—from **$22,726,418 thousand** in FY 2022 to **$17,097,330 thousand** in FY 2023—due in part to commodity deflation and fewer single-family housing starts, which directly impacted core organic net sales.  **[0000950170-24-018404_bldr-ex99_1.htm:0]** **[0000950170-24-018584_bldr-20231231.htm:64]**  This sales decline contributed to a **reduced gross margin** (from **$7,744,379 thousand** in FY 2022 to **$6,012,334 thousand** in FY 2023).  **[0000950170-24-018584_bldr-20231231.htm:64]**  Additionally, **increased operating costs relative to sales**—evidenced by a rise in SG&A expenses—eroded operating leverage.  **[0000950170-24-018584_bldr-20231231.htm:64]** **[0000950170-24-018404_bldr-ex99_1.htm:11]**  Moreover, the **adjusted EBITDA** dropped by **33.8%** (from **$4,376,600 thousand** to **$2,899,300 thousand**), and a slight increase in interest expense (from **$198,373 thousand** to **$192,115 thousand**) further pressured net income.  **[0000950170-24-018404_bldr-ex99_1.htm:2]** **[0000950170-24-018404_bldr-ex99_1.htm:11]** **[0000950170-24-018584_bldr-20231231.htm:64]** 

What factors contributed to the sharp decline in Net Income in FY 2023?

The drop in Income from Operations in Q1 2024 was primarily due to a combination of **lower gross profit** and **higher SG&A expenses**. The gross profit decline resulted from a **190 basis point decline in gross margin** and a shift toward **lower-margin, early-stage homebuilding products**, as well as margin normalization in the Multi-Family segment. Additionally, SG&A expenses increased by **$22,040 thousand** due to acquired operations, which together led to a reduction of **$93,586 thousand** in operating income compared to Q1 2023.  **[0000950170-24-053918_bldr-ex99_1.htm:0]** **[BLDR_3386751_5]** **[0000950170-24-054249_bldr-20240331.htm:1]** 

Why did Income from Operations drop noticeably in Q1 2024?

The significant decline in EPS in Q3 2024 was primarily driven by **lower gross profit** due to a 12.3% decline paired with weakening margins, **increased operating expenses** (with SG&A expenses rising by $18.8 million and marking a 190 basis point increase as a percentage of net sales), **declining net sales** (a 6.7% drop driven by a 7.2% decline in core organic sales and commodity deflation), and a reduction in **income before taxes** (from $591.4 million to $373.8 million). Together, these factors, despite a somewhat lower income tax expense, collectively contributed to the pronounced decrease in EPS for Q3 2024.  **[0000950170-24-121065_bldr-ex99_1.htm:3]** **[0000950170-24-121436_bldr-20240930.htm:1]** 

What led to the significant decline in EPS in Q3 2024?

f326ad477d84740b41e5f4540413174d99454e45aa5cdf58a1b88f9930b05d6c

88d09193df40864ffa2c269df93d599bc284da56e75d6490830172a33134062d

ef5fc1018c654ad434cd38ecdd3932ec87472ff66a7ebbf36354ccb740d3cbeb

Net Sales (USD, thousands)

Cost of Sales (USD, thousands)

Gross Margin (USD, thousands)

Selling, General and Administrative Expenses (USD, thousands)

Income from Operations (USD, thousands)

Interest Expense, Net (USD, thousands)

Income Before Income Taxes (USD, thousands)

Income Tax Expense (USD, thousands)

Net Income (USD, thousands)

Net Income per Share - Basic (USD)

Net Income per Share - Diluted (USD)

Weighted Average Common Shares - Basic (thousands)

Weighted Average Common Shares - Diluted (thousands)

2ded81a2752a846a6f15b21179527484e83ad6bb13399ffeefcdfeffefd851ba

ad9b0c6316691186ba6d0ba80308ba6eef1e843ac2cade7ea51fc97547ffd185

Adjustments for Non-Cash Items [USD, Thousands]

Stock-Based Compensation [USD, Thousands]

Changes in Working Capital [USD, Thousands]

Capital Expenditures (CapEx) [USD, Thousands]

Proceeds from / Repayments of Debt [USD, Thousands]

Share Repurchases [USD, Thousands]

Dividend Payments [USD, Thousands]

Net Change in Cash [USD, Thousands]

a217fb31877a63d1992cb04ee84f3da0ddbe25c8170bd14dca932de3af67e56e

78291e8eb53ef8754c68eb1716d8e4c46a142608bad2bcaa609e671a13df795a

Number of operating locations (locations)

Number of states with operations (states)

d164844d45bc9ea847e1bbb559089adc48a2f44e20cbf52acebd4eada1ff0474

Northeast

Southeast

South

West

All Other

Total Revenue

c548e1175a75fb0073433759b3f4c56b4246f2b9a46c8ba961dd8cd76a2138cc

Lumber & Lumber Sheet Goods

Manufactured Products

Windows, Doors & Millwork

- Windows & Doors

- Millwork

Specialty Building Products & Services

Siding, Metal & Concrete Products

Gypsum, Roofing & Insulation

Other Building Products & Services

79b0caaef669d30f80f7b5c1eeea2a12bca3cb20f1c7a6f7375cdb1be2da086a

Builders FirstSource (BLDR)

Financials