Exhibit 99.1

Graphic

A leading installer and specialty distributor of insulation and building material products

to the North American construction industry.

TopBuild Reports Third Quarter 2021 Results

21.3% increase in net sales
120 basis point gross margin expansion to 29.6%
120 basis point operating margin expansion to 15.8%, 170 basis points
on an adjusted basis
160 basis point adjusted EBITDA margin expansion to 18.7%

Third Quarter Financial Highlights

(unless otherwise indicated, comparisons are to the quarter ended September 30, 2020)

   

Gross margin increased 110 basis points to 27.6%.  On an adjusted basis, gross margin increased 130 basis points to 27.8%

   Operating profit was $80.5 million, compared to operating profit of $76.0 million.  On an adjusted basis, operating profit was $83.5 million, compared to $76.4 million, a 9.3% improvement.

   Net income was $55.5 million, or $1.67 per diluted share, compared to $52.1 million, or $1.51 per diluted share. Adjusted income was $55.7 million, or $1.68 per diluted share, compared to $49.5 million, or $1.43 per diluted share.

   

Net sales increased 21.3% to $845.8 million, 10.6% on a same branch basis, primarily driven by price and acquisitions.  

   

Gross margin increased 120 basis points to 29.6%.

   Operating profit was $133.8 million, compared to operating profit of $101.5 million.  On an adjusted basis, operating profit was $137.4 million, compared to $101.7 million, a 35.2% improvement.

   Operating margin increased 120 basis points, and on an adjusted basis expanded 170 basis points to 16.3%.  

   Net income was $95.4 million, or $2.88 per diluted share, compared to $70.0 million, or $2.11 per diluted share. Adjusted income was $97.7 million, or $2.95 per diluted share, compared to $69.6 million, or $2.10 per diluted share.

“We are pleased with our overall results, particularly in this challenging environment characterized by supply chain disruptions and labor shortages across the entire construction industry. These market imbalances have impacted homebuilders’ ability to meet the continuing strong consumer demand, constraining growth for the entire industry.

“Our teams continue to do an excellent job managing inputs costs and pricing as evidenced by our strong EBITDA margin expansion this quarter.

“Looking ahead, we are confident in the overall fundamentals of our three end-markets; residential, commercial, and industrial, and our ability to leverage our size, scale, and operational excellence to continue to drive profitable growth.”

ROBERT BUCK, PRESIDENT & CEO,

   

Adjusted EBITDA was $158.2 million, compared to $119.2 million, a 32.8% increase, and adjusted EBITDA margin improved 160 basis points to 18.7%.

   

At September 30, 2021, the Company had cash and cash equivalents of $327.9 million and availability under its revolving credit facility of $381.9 million for total liquidity of $709.8 million.

NYSE:BLD

November 2, 2021

topbuild.com


Nine Month Financial Highlights

(unless otherwise indicated, comparisons are to nine months ended September 30, 2020)

   

Net sales increased 21.3% to $2,422.8 million.

   

Gross margin expanded 100 basis points to 28.5%.

   

Operating profit was $358.0 million, compared to operating profit of $252.0 million. On an adjusted basis, operating profit was $364.5 million, compared to $255.5 million, a 42.7% improvement.

   

Operating margin was 14.8% a 220-basis point improvement. On an adjusted basis, operating margin improved 220 basis points to 15.0%.

   

Net income was $245.7 million, or $7.41 per diluted share, compared to $176.3 million, or $5.29 per diluted share. Adjusted income was $256.4 million, or $7.73 per diluted share, compared to $171.2 million, or $5.14 per diluted share.

   

Adjusted EBITDA was $423.9 million, compared to $315.3 million, a 34.4% increase. Adjusted EBITDA margin was 17.5%, a 170-basis point improvement.

Operating Segment Highlights ($ in 000s)

(comparisons are to the period ended September 30, 2020)

Logo

Description automatically generated

3 Months
Ended
9/30/21

9 Months
Ended
9/30/21

Graphic

3 Months
Ended
9/30/21

9 Months
Ended
9/30/21

Sales

$612,900

$1,751,278

Sales

$276,398

$801,363

Change

Change

Volume

1.9%

5.7%

Volume

-5.2%

7.1%

Price

8.4%

4.9%

Price

16.5%

10.4%

M&A

14.3%

11.5%

M&A

1.9%

1.3%

Total Change

24.5%

22.1%

Total Change

13.2%

18.8%

Operating Margin

17.1%

15.9%

Operating Margin

17.1%

15.6%

Change

20 bps

100 bps

Change

370 bps

350 bps

Adj. Operating Margin

17.2%

16.0%

Adj. Operating Margin

17.1%

15.7%

Change

20 bps

100 bps

Change

370 bps

350 bps

Capital Allocation

Acquisitions

Table

Description automatically generated

NYSE:BLD

November 2, 2021

topbuild.com


I = Installation

D = Distribution

Share repurchases

In the third quarter of 2021, the Company repurchased 60,105 shares at an average price of $191.64 per share.  Year-to-date the Company has repurchased 183,136 shares as an average price of $194.15 per share.  

2021 Outlook

Sales and Adjusted EBITDA Guidance (1)

($ in millions)

Graphic

(1) See table for adjusted EBITDA reconciliation.

“Acquisitions continue to be our number one capital allocation priority and our acquisition of Distribution International has further enhanced our robust M&A pipeline focused on three end-markets; residential, commercial, and industrial.

“Over the past six years, we have put together a disciplined team to source and integrate deals, and during this timeframe have put almost $2 billion of capital to work for our shareholders.”

ROBERT BUCK, PRESIDENT & CEO,

Additional Information

Quarterly supplemental materials, including a presentation that will be referenced on today’s conference call, are available on the Company’s website at www.topbuild.com.  

Conference Call

A conference call to discuss third quarter 2021 financial results is scheduled for today, Tuesday, November 2, at 9:00 a.m. Eastern Time.  The call may be accessed by dialing (877) 407-9037.  The conference call will be webcast simultaneously on the Company’s website at www.topbuild.com.  

About TopBuild

TopBuild Corp., headquartered in Daytona Beach, Florida, is a leading installer and specialty distributor of insulation and building material products to the North American construction industry. We provide insulation solutions and building material installation services through TruTeam which has approximately 235 branches.  We distribute building insulation and building product materials for the residential and commercial end-markets through Service Partners and mechanical insulation and other specialty products for the commercial and industrial end-markets through Distribution International.  Our specialty distribution network encompasses 175 branches.  To learn more about TopBuild please visit our website at www.topbuild.com.

NYSE:BLD

November 2, 2021

topbuild.com


Use of Non-GAAP Financial Measures

Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the “adjusted” financial measures presented above, and figures presented on a “same branch basis” are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”).  The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months.  Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release.  Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP.  Additional information may be found in the Company’s filings with the Securities and Exchange Commission which are available on TopBuild’s website at www.topbuild.com.

Safe Harbor Statement

Statements contained herein reflect our views about future periods, including our future plans and performance, constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995.  Forward-looking statements can be identified by words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms, and similar references to future periods.  These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements.  We caution you against unduly relying on any of these forward-looking statements.  Our future performance may be affected by the duration and impact of the COVID-19 pandemic on the United States economy, specifically with respect to residential and commercial construction; our ability to continue operations in markets affected by the COVID-19 pandemic and our ability to collect receivables from our customers; our reliance on residential new construction, residential repair/remodel, and commercial construction; our reliance on third-party suppliers and manufacturers; our ability to attract, develop, and retain talented personnel and our sales and labor force; our ability to maintain consistent practices across our locations; and our ability to maintain our competitive position.  We discuss the material risks we face under the caption entitled “Risk Factors” in our Annual Report for the year ended December 31, 2020, as filed with the SEC in February 2021, as well as under the caption entitled “Risk Factors” in subsequent reports that we file with the SEC.  Our forward-looking statements in this filing speak only as of the date of this filing.  Factors or events that could cause our actual results to differ may emerge from time to time and it is not possible for us to predict all of them.  Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise.  The Company believes that the non-GAAP performance measures and ratios that are contained herein, which management uses to manage our business, provide users of this financial information with additional meaningful comparisons between current results and results in our prior periods. Non-GAAP performance measures and ratios should be viewed in addition, and not as an alternative, to the Company's reported results under accounting principles generally accepted in the United States. Additional information about the Company is contained in the Company's filings with the SEC and is available on TopBuild's website at www.topbuild.com.

Investor Relations and Media Contact

Tabitha Zane

tabitha.zane@topbuild.com

386-763-8801

(tables follow)

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except share and per common share amounts)

Three Months Ended September 30, 

Nine Months Ended September 30, 

2021

2020

2021

2020

Net sales

$

845,757

    

$

697,223

    

$

2,422,810

    

$

1,996,551

Cost of sales

595,466

498,895

1,731,581

1,448,210

Gross profit

250,291

198,328

691,229

548,341

Selling, general, and administrative expense

116,485

96,805

333,252

296,372

Operating profit

133,806

101,523

357,977

251,969

Other income (expense), net:

Interest expense

(5,503)

(7,692)

(18,210)

(24,711)

Loss on extinguishment of debt

(13,862)

(233)

Other, net

66

86

210

648

Other expense, net

(5,437)

(7,606)

(31,862)

(24,296)

Income before income taxes

128,369

93,917

326,115

227,673

Income tax expense

(32,934)

(23,921)

(80,457)

(51,407)

Net income

$

95,435

$

69,996

$

245,658

$

176,266

Net income per common share:

Basic

$

2.91

$

2.13

$

7.49

$

5.35

Diluted

$

2.88

$

2.11

$

7.41

$

5.29

 

Weighted average shares outstanding:

Basic

32,763,311

32,847,652

32,818,145

32,960,969

Diluted

33,088,680

33,210,545

33,155,995

33,337,259

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Condensed Consolidated Balance Sheets and Other Financial Data (Unaudited)

(dollars in thousands)

As of

September 30, 2021

December 31, 2020

ASSETS

Current assets:

Cash and cash equivalents

$

327,906

$

330,007

Receivables, net of an allowance for credit losses of $8,856 at September 30, 2021, and $6,926 at December 31, 2020

516,941

 

427,340

Inventories, net

202,018

 

161,369

Prepaid expenses and other current assets

21,240

 

17,689

Total current assets

1,068,105

 

936,405

Right of use assets

104,047

 

83,490

Property and equipment, net

203,530

 

180,053

Goodwill

1,496,737

 

1,410,685

Other intangible assets, net

234,872

 

190,605

Deferred tax assets, net

2,751

 

2,728

Other assets

10,646

 

11,317

Total assets

$

3,120,688

$

2,815,283

LIABILITIES

Current liabilities:

Accounts payable

$

382,932

$

331,710

Current portion of long-term debt

23,557

23,326

Accrued liabilities

141,261

 

107,949

Short-term lease liabilities

37,048

 

33,492

Total current liabilities

584,798

 

496,477

Long-term debt

675,567

 

683,396

Deferred tax liabilities, net

166,240

 

168,568

Long-term portion of insurance reserves

47,775

50,657

Long-term lease liabilities

71,290

53,749

Other liabilities

13,307

 

13,642

Total liabilities

1,558,977

 

1,466,489

EQUITY

1,561,711

 

1,348,794

Total liabilities and equity

$

3,120,688

$

2,815,283

As of September 30, 

    

2021

2020

Other Financial Data

Receivable days

45

48

Inventory days

33

27

Accounts payable days

75

81

Receivables, net plus inventories, net less accounts payable

$

336,027

$

267,369

Receivables, net plus inventories, net less accounts payable as a percent of sales (TTM) †

10.3

%

10.1

%

Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)

Nine Months Ended September 30, 

2021

2020

Cash Flows Provided by (Used in) Operating Activities:

    

    

    

Net income

$

245,658

$

176,266

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

Depreciation and amortization

51,005

47,527

Share-based compensation

8,375

12,159

Loss on extinguishment of debt

13,862

233

Loss on sale or abandonment of property and equipment

1,410

290

Amortization of debt issuance costs

1,352

1,103

Provision for bad debt expense

5,215

5,625

Loss from inventory obsolescence

1,667

1,908

Deferred income taxes, net

(1,661)

(709)

Change in certain assets and liabilities

Receivables, net

(62,257)

(13,645)

Inventories, net

(30,115)

4,759

Prepaid expenses and other current assets

(2,984)

(14,989)

Accounts payable

47,907

2,152

Accrued liabilities

30,397

33,436

Payment of contingent consideration

(22)

(413)

Other, net

(304)

21

Net cash provided by operating activities

309,505

255,723

Cash Flows Provided by (Used in) Investing Activities:

Purchases of property and equipment

(42,320)

(27,206)

Acquisition of businesses

(205,028)

(21,450)

Proceeds from sale of property and equipment

298

2,332

Net cash used in investing activities

(247,050)

(46,324)

Cash Flows Provided by (Used in) Financing Activities:

Proceeds from issuance of long-term debt

411,250

300,000

Repayment of long-term debt

(427,563)

(319,168)

Payment of debt issuance costs

(6,500)

(2,280)

Taxes withheld and paid on employees' equity awards

(11,511)

(14,781)

Exercise of stock options

5,952

1,438

Repurchase of shares of common stock

(35,556)

(43,149)

Payment of contingent consideration

(628)

(928)

Net cash used in financing activities

(64,556)

(78,868)

Cash and Cash Equivalents

(Decrease) increase for the period

(2,101)

130,531

Beginning of period

 

330,007

 

184,807

End of period

$

327,906

$

315,338

Supplemental disclosure of noncash activities:

Leased assets obtained in exchange for new operating lease liabilities

$

51,190

$

27,098

Accruals for property and equipment

580

278

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Segment Data (Unaudited)

(dollars in thousands)

Three Months Ended September 30, 

Nine Months Ended September 30, 

2021

2020

Change

2021

2020

Change

TruTeam

Sales

$

612,900

$

492,206

24.5

%

$

1,751,278

$

1,434,648

22.1

%

Operating profit, as reported

$

105,046

$

83,142

$

277,748

$

213,136

Operating margin, as reported

17.1

%

16.9

%

15.9

%

14.9

%

Rationalization charges

9

866

Acquisition related costs

171

1,283

4

COVID-19 pay

278

605

916

Operating profit, as adjusted

$

105,217

$

83,429

$

279,636

$

214,922

Operating margin, as adjusted

17.2

%

17.0

%

16.0

%

15.0

%

Service Partners

Sales

$

276,398

$

244,113

13.2

%

$

801,363

$

674,672

18.8

%

Operating profit, as reported

$

47,162

$

32,787

$

125,403

$

81,612

Operating margin, as reported

17.1

%

13.4

%

15.6

%

12.1

%

Rationalization charges

(161)

783

COVID-19 pay

15

54

70

Operating profit, as adjusted

$

47,162

$

32,641

$

125,457

$

82,464

Operating margin, as adjusted

17.1

%

13.4

%

15.7

%

12.2

%

Total

Sales before eliminations

$

889,298

$

736,319

$

2,552,641

$

2,109,320

Intercompany eliminations

(43,541)

(39,096)

(129,831)

(112,769)

Net sales after eliminations

$

845,757

$

697,223

21.3

%

$

2,422,810

$

1,996,551

21.3

%

Operating profit, as reported - segments

$

152,208

$

115,929

$

403,151

$

294,748

General corporate expense, net

(10,812)

(8,032)

(24,124)

(24,610)

Intercompany eliminations

(7,590)

(6,374)

(21,050)

(18,169)

Operating profit, as reported

$

133,806

$

101,523

$

357,977

$

251,969

Operating margin, as reported

15.8

%

14.6

%

14.8

%

12.6

%

Rationalization charges

(274)

16

2,102

Acquisition related costs †

3,634

142

5,844

338

Refinancing costs

57

COVID-19 pay

293

659

984

Operating profit, as adjusted

$

137,440

$

101,684

$

364,496

$

255,450

Operating margin, as adjusted

16.3

%

14.6

%

15.0

%

12.8

%

Share-based compensation

2,998

3,280

8,375

12,317

Depreciation and amortization

17,784

14,216

51,005

47,527

EBITDA, as adjusted

$

158,222

$

119,180

$

423,876

$

315,294

EBITDA margin, as adjusted

18.7

%

17.1

%

17.5

%

15.8

%

Sales change period over period

148,534

426,259

EBITDA, as adjusted, change period over period

39,042

108,582

Incremental EBITDA, as adjusted, as a percentage of change in sales

22.4

%

25.0

%

† Acquisition related costs include corporate level adjustments as well as segment operating adjustments.

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Non-GAAP Reconciliations (Unaudited)

(in thousands, except share and per common share amounts)

Three Months Ended September 30, 

Nine Months Ended September 30, 

2021

2020

2021

2020

Gross Profit and Operating Profit Reconciliations

Net sales

$

845,757

$

697,223

$

2,422,810

$

1,996,551

Gross profit, as reported

$

250,291

$

198,328

$

691,229

$

548,341

Rationalization charges

(63)

1,016

COVID-19 pay

-

273

592

755

Gross profit, as adjusted

$

250,291

$

198,538

$

691,821

$

550,111

Gross margin, as reported

29.6

%

28.4

%

28.5

%

27.5

%

Gross margin, as adjusted

29.6

%

28.5

%

28.6

%

27.6

%

Operating profit, as reported

$

133,806

$

101,523

$

357,977

$

251,969

Rationalization charges

(274)

16

2,102

Acquisition related costs

3,634

142

5,844

338

Refinancing costs

57

COVID-19 pay

-

293

659

984

Operating profit, as adjusted

$

137,440

$

101,684

$

364,496

$

255,450

Operating margin, as reported

15.8

%

14.6

%

14.8

%

12.6

%

Operating margin, as adjusted

16.3

%

14.6

%

15.0

%

12.8

%

Income Per Common Share Reconciliation

Income before income taxes, as reported

$

128,369

$

93,917

$

326,115

$

227,673

Rationalization charges

(274)

16

2,102

Acquisition related costs

3,634

142

5,844

338

Refinancing costs and loss on extinguishment of debt

13,862

290

COVID-19 pay

-

293

659

984

Income before income taxes, as adjusted

132,003

94,078

346,496

231,387

Tax rate at 26.0%

(34,321)

(24,460)

(90,089)

(60,161)

Income, as adjusted

$

97,682

$

69,618

$

256,407

$

171,226

Income per common share, as adjusted

$

2.95

$

2.10

$

7.73

$

5.14

Weighted average diluted common shares outstanding

33,088,680

33,210,545

33,155,995

33,337,259

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Same Branch and Acquisition Net Sales and Adjusted EBITDA (Unaudited)

(dollars in thousands)

Three Months Ended September 30, 

Nine Months Ended September 30, 

2021

2020

2021

2020

Net sales

Same branch:

TruTeam

$

542,679

$

492,206

$

1,586,336

$

1,434,648

Service Partners

271,760

244,113

792,834

674,672

Eliminations

(43,206)

(39,096)

(128,511)

(112,769)

Total same branch

771,233

697,223

2,250,659

1,996,551

Acquisitions (a):

TruTeam

$

70,221

$

$

164,942

$

Service Partners

4,638

8,529

Eliminations

(335)

(1,320)

Total acquisitions

74,524

172,151

Total

$

845,757

$

697,223

$

2,422,810

$

1,996,551

EBITDA, as adjusted

Same branch

$

146,774

$

119,180

$

400,328

$

315,294

Acquisitions (a)

11,448

23,548

Total

$

158,222

$

119,180

$

423,876

$

315,294

EBITDA, as adjusted, as a percentage of sales

Same branch (b)

19.0

%

17.8

%

Acquisitions (c)

15.4

%

13.7

%

Total (d)

18.7

%

17.1

%

17.5

%

15.8

%

As Adjusted Incremental EBITDA, as a percentage of change in sales

Same branch (e)

37.3

%

33.5

%

Acquisitions (c)

15.4

%

13.7

%

Total (f)

26.3

%

25.5

%


(a) Represents current year impact of acquisitions in their first twelve months

(b) Same branch EBITDA, as adjusted, as a percentage of same branch sales

(c) Acquired EBITDA, as adjusted, as a percentage of acquired sales

(d) Total EBITDA, as adjusted, as a percentage of total sales

(e) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales

(f) Change in total EBITDA, as adjusted, as a percentage of change in total sales

NYSE:BLD

November 2, 2021

topbuild.com


TopBuild Corp.

Same Branch and Acquisition Net Sales by Market (Unaudited)

(in thousands)

Three Months Ended September 30, 

Nine Months Ended September 30, 

2021

2020

2021

2020

Same branch:

Residential

$

610,377

$

545,688

$

1,761,630

$

1,557,954

Commercial

160,856

151,535

489,029

438,597

Same branch net sales

771,233

697,223

2,250,659

1,996,551