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JELD-WEN Shares Plunge Post Q2 Bottom-Line Miss, FY22 Guidance Cut

  • JELD-WEN Holding Inc (NYSE: JELD) reported second-quarter revenue growth of 6.8% year-over-year to $1.331 billion, driven by an 11% increase in core revenue, merely beating the consensus of $1.33 billion.

  • Adjusted EPS was $0.57, missing the consensus of $0.65.

  • The gross margin contracted by 493 bps to 18.5%. The operating income fell to $60.4 million from $102.1 million, and the margin was 4.5%, down from 8.2%.

  • Adjusted EBITDA was $125.8 million (-15.1% Y/Y), and the margin contracted by 244 bps to 9.5%.

  • JELD realized 12% pricing to mitigate significant cost inflation.

  • "Significant cost inflation and softening retail demand in North America and Europe impacted our profitability more than we anticipated in the second quarter. These results are not indicative of the performance-driven culture and expectations at JELD-WEN," stated Gary S. Michel, chair and CEO.

  • The company repurchased 5.2 million shares in the first six months.

  • Buyback: The board approved new $200 million share repurchase authorization, replacing the company's existing program.

  • Net cash flow used in operations year-to-date was $(165.7) million, compared to cash generated of $40.7 million a year ago. Free cash outflow was $(200.5) million.

  • Total liquidity, including cash and cash equivalents and undrawn committed credit facilities, was $550.8 million as of June 25, 2022.

  • FY22 Outlook: JELD expects core revenue growth of ~10% and revised revenue growth forecast to 4% - 6% from a previous range of 7% - 10%.

  • It sees Adjusted EBITDA of $430 million - $450 million, down from the prior view of $520 million - $565 million.

  • Price Action: JELD shares are trading lower by 15.64% at $15.00 on the last check Monday.

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