Owens Corning Delivers Net Sales of $3.0 Billion

Owens Corning, a residential and commercial building products leader, today reported third-quarter 2024 results.

• Reported Net Sales of $3.0 Billion, a 23% Increase from Prior Year, with Newly Acquired Doors Business Contributing $573 Million in Revenue
• Generated Net Earnings Margin of 11%, Adjusted EBIT Margin of 19%, and Adjusted EBITDA Margin of 25%
• Delivered Diluted EPS of $3.65 and Adjusted Diluted EPS of $4.38
• Produced Operating Cash Flow of $699 Million and Free Cash Flow of $558 Million
• Returned $252 Million to Shareholders through Dividends and Share Repurchases

“Our third-quarter results demonstrate the impact of the strategic choices and structural improvements we have made to strengthen Owens Corning and build a company that continues to deliver strong free cash flow and sustainably higher margins despite a challenging market environment. The strong execution of our team, combined with the key initiatives and investments we are undertaking, is accelerating our growth, strengthening our earnings power, and reshaping the company,” said Chair and Chief Executive Officer Brian Chambers. “As we finish 2024, we remain focused on sustaining our strong financial performance while executing our strategic agenda to sharpen our product and geographic focus where we can create unique value for our customers and shareholders.”

Enterprise Strategy Highlights

• In the third quarter, Owens Corning maintained a high level of safety performance with a recordable incident rate (RIR) of 0.58. This excludes the Doors segment, which will be integrated into company safety reporting in 2025.
• Owens Corning is investing in the continued development of a flexible and cost-efficient U.S. fiberglass insulation network through the addition of a new line within its Kansas City, Kansas manufacturing facility. This insulation capacity, which is expected to come online in 2027, will incorporate advanced technology to produce both light and heavy density fiberglass products with an improved cost structure. The new line will also provide production flexibility to increase residential insulation capacity across the network.
• Owens Corning has entered into an agreement to sell its building materials business in China and Korea to a member of the business’s management team. The transaction includes six insulation manufacturing facilities in China and a roofing manufacturing facility in Korea and represents annual revenue of approximately $130 million. Not included are the company’s glass reinforcements plants in Asia Pacific, its coated wovens manufacturing plants in India, and its cellular glass plant in China. The decision to divest this business is consistent with the company’s strategy to focus on North American and European building products.
• Owens Corning continues to progress in the exploration of strategic alternatives for its global glass reinforcements business to maximize value for shareholders. The company also continues to implement restructuring actions to drive cost efficiencies and optimization in the business.

Cash Returned to Shareholders

• The company returned $252 million to shareholders through dividends and share repurchases during the third quarter. The company paid a quarterly cash dividend of $52 million and repurchased 1.2 million shares of common stock for $200 million. At the end of the quarter, 6.9 million shares were available for repurchase under the current authorization.

“In the third quarter, we demonstrated the strong earnings power and cash generation potential of the enterprise. Our team delivered top and bottom-line growth as a result of best-in-class commercial and operational execution, and the addition of the Doors segment. We also executed a $200 million share repurchase program that delivered on our commitment to return significant cash to shareholders,” said Executive Vice President and Chief Financial Officer Todd Fister. “As we enter the fourth quarter, the enterprise is well positioned to deliver value. We have multiple paths to sustain our structurally improved EBITDA margins, deliver strong cash generation, and continue to return cash to shareholders.”

Other Notable Highlights

• Owens Corning was recently recognized in the Top 10 of the 100 Best Corporate Citizens list for the seventh consecutive year. The list recognizes outstanding environmental, social, and governance performance and transparency among the largest publicly traded companies in the U.S. The company placed first within its industry category.

Third-Quarter Business Performance

• In the third quarter, the company grew earnings despite challenging market conditions across a number of its end markets.
• Roofing net sales of $1.1 billion were relatively flat compared with third-quarter 2023, as shingle volumes outperformed the U.S. asphalt shingle market, which was down slightly compared to prior year. Positive price, favorable mix, and shingle volume growth offset lower components sales from distributors resetting inventory in the channel and the exit of protective packaging. EBIT increased $16 million to $359 million, with 33% EBIT margin and 35% EBITDA margin, as a result of positive price, favorable mix, and favorable delivery.
• Insulation net sales increased 4% to $946 million compared with third-quarter 2023, primarily due to positive price realization in both North America residential and technical and global insulation. Volume growth in North America residential was largely offset by the volume impact of a weaker Europe macroeconomic environment. EBIT increased $33 million to $183 million, with 19% EBIT margin and 25% EBITDA margin, as strong commercial execution drove positive price realization on previously announced increases.
• Doors generated net sales of $573 million in its first full quarter as a reporting segment within Owens Corning. The market conditions remained challenging for this business, including decreased discretionary repair and remodel spend impacting demand and price. EBIT was $36 million, with 6% EBIT margin, which reflects the $22 million impact of purchase accounting. EBITDA was $89 million with 16% EBITDA margin.
• Composites net sales decreased 6% to $534 million compared with third-quarter 2023, primarily due to challenging markets and price declines in glass reinforcements. EBIT decreased $19 million to $61 million, with 11% EBIT margin and 20% EBITDA margin, as lower price in glass reinforcements and the impact of incremental costs associated with commissioning a new nonwovens line in Fort Smith, Arkansas was partially offset by favorable manufacturing performance.

Fourth-Quarter 2024 Outlook

• The key economic factors that impact the company’s business are U.S. residential repair and remodeling activity, U.S. housing starts, global commercial construction, and global industrial production.
• Owens Corning expects near-term demand to be impacted by ongoing challenging conditions in most markets and normalizing seasonality. In its North American building and construction markets, non-discretionary repair and remodeling activity is expected to be solid while discretionary repair and remodeling activity is expected to remain soft. Demand from single-family new construction is also expected to be down with the decline in lagged housing starts. Outside North America, macroeconomic trends and geopolitical tensions continue to result in slow global economic growth.
• For the fourth-quarter 2024, despite more challenging market conditions, the company expects to continue delivering strong results, reflecting structural changes to its portfolio and cost structure. It expects net sales growth around 20 percent, including overall revenue for the legacy business slightly below fourth-quarter 2023 plus the addition of revenue for the Doors segment. The enterprise is expected to generate mid-teens EBIT margin and EBITDA margin of approximately 20 percent.

About Owens Corning

Owens Corning is a residential and commercial building products leader committed to building a sustainable future through material innovation. Our four integrated businesses – Roofing, Insulation, Doors, and Composites – provide durable, sustainable, energy-efficient solutions that leverage our unique material science, manufacturing, and market knowledge to help our customers win and grow. We are global in scope, human in scale with more than 25,000 employees in 31 countries dedicated to generating value for our customers and shareholders and making a difference in the communities where we work and live. Founded in 1938 and based in Toledo, Ohio, USA, Owens Corning posted 2023 sales of $9.7 billion. For more information, visit www.owenscorning.com.

Source: Owens Corning