Operating Margin Target
Q: Is 20% operating margin the new floor? How will you achieve it?
A: Management stated that 20% operating margin is their floor, aiming to return to that level next year " " . They will be more selective with investments in SG&A and cost of goods, focusing on controlling costs while still providing strong customer support. " Anything below 20% is unacceptable, and they will work to improve profitability " " .

Housing Starts Outlook
Q: What are your expectations for housing starts in 2025?
A: They anticipate 3–4% growth in U.S. housing starts next year, based on customer input and forecasters. " In Europe, they expect 1–2% growth, with modest recovery due to lower interest rates " " . However, they acknowledge uncertainty and note that the second half of the year may be better than the first. "

Gross Margin Expectations
Q: How do you expect gross margins to trend in Q4 and next year?
A: They expect gross margins in Q4 to be flattish to slightly up from last year's 43.9% " " . Factors include slightly higher factory and tooling costs as a percent of revenue, potential benefits on freight costs, and a good position on material costs. " They are comfortable with steel costs and haven't seen significant pricing pressure from competitors " " .

Acquisitions Impact
Q: What can you tell us about the recent acquisitions?
A: The acquisitions of Monet DeSauw and QuickFrames add new tools to serve component manufacturers and commercial customers. " The combined revenue from these acquisitions is expected to be less than $10 million in Q4. " They see these additions as strategic fits that enhance their product offerings. "

Cost Control Measures
Q: How will you manage costs to support margins?
A: Management plans to dial in SG&A investments, being more selective on where they add both in SG&A and cost of goods. " They aim to control costs while ensuring they provide great support to customers, which is key to their business model. "

Exposure to True Value Bankruptcy
Q: Are there any risks from the True Value bankruptcy filing?
A: They have sold to True Value in the past but the revenue is not material for Simpson. " They are evaluating the situation and the potential buyer, with whom they have a good relationship, and will assess credit decisions accordingly. "

Impact of Hurricanes on Q4
Q: How will the hurricanes affect Q4 sales and operating income?
A: Hurricanes have caused slowdowns in the Southeast, with some customers significantly impacted " " . They haven't specified the exact impact on guidance, but forecasted Q4 sales in affected areas are definitely lower than expected. "

European Margin Improvement
Q: Do you expect margin improvement in Europe next year?
A: They are working on defensive synergies and rightsizing their footprint in Europe. " Some costs incurred this year will not repeat, which should help improve gross margins going forward. "

Facility Expansions
Q: What are the costs associated with facility expansions?
A: They plan to provide more details in their 2025 guidance. " The Ohio expansion adds to the existing footprint with no significant OpEx expected. " Gallatin will involve moving costs but further granularity will be provided later. "