American Woodmark Corporation Announces Third Quarter Results

American Woodmark Corporation (the “Company”) announced results for its third fiscal quarter ended January 31, 2025.

Fiscal Third Quarter 2025 Financial Highlights:

• Net sales of $397.6 million
• Net income of $16.6 million; 4.2% of net sales
• GAAP EPS of $1.09; adjusted EPS of $1.05
• Adjusted EBITDA of $38.4 million; 9.7% of net sales
• Cash provided by operating activities of $11.0 million; free cash flow of $1.4 million
• Repurchased 132,075 shares for $12.6 million

Fiscal 2025 First Nine Months Financial Highlights:

• Net sales of $1,309.2 million
• Net income of $73.9 million; 5.6% of net sales
• GAAP EPS of $4.79; adjusted EPS of $5.28
• Adjusted EBITDA of $161.5 million; 12.3% of net sales
• Cash provided by operating activities of $63.7 million; free cash flow of $31.5 million
• Repurchased 752,412 shares for $69.1 million

“Despite performance that was below our expectations for the quarter, our teams continue to execute and have built a platform to deliver profitable growth when macroeconomic conditions improve. The quarter was impacted by softer demand in the remodel market and a decline in new construction single family activity as inventories were reduced,” said Scott Culbreth, President and CEO. “Demand trends are expected to remain challenging, and our outlook is for a mid-single digit decline in net sales for the full fiscal year and an Adjusted EBITDA range of $210 million to $215 million.”

Third Quarter Results 

Net sales for the third quarter of fiscal 2025 decreased $24.5 million, or 5.8%, to $397.6 million compared with the same quarter last fiscal year. Net income was $16.6 million ($1.09 per diluted share and 4.2% of net sales) compared with $21.2 million ($1.32 per diluted share and 5.0% of net sales) last fiscal year. Net income decreased $4.7 million due to lower net sales, increasing supply chain costs, and restructuring charges totaling $0.5 million related to a reduction in force implemented during the second quarter and the closure of the manufacturing facility located in Orange, Virginia, which was announced in January 2025, partially offset by the roll-off of acquisition-related intangible asset amortization and lower year-over-year incentive compensation. Adjusted EPS per diluted share was $1.05 for the third quarter of fiscal 2025 compared with $1.561 last fiscal year. Adjusted EBITDA for the third quarter of fiscal 2025 decreased $12.2 million, or 24.0%, to $38.4 million, or 9.7% of net sales, compared with $50.6 million, or 12.0% of net sales, last fiscal year. 

During January 2025, the Company’s Board approved the closure and eventual disposal of its manufacturing plant located in Orange, Virginia. The Company expects to incur total pre-tax restructuring costs of $6.0 million to $8.5 million related to the closing of the plant. The restructuring costs consist of employee severance and separation costs of approximately $2.0 million to $2.5 million, and charges for relocation and disposal of property and equipment and other administrative costs of approximately $4.0 million to $6.0 million. The Company expects to recognize substantially all of these costs during fiscal 2025. 

¹During the second quarter of fiscal 2025, the Company changed its definition of Adjusted EPS per diluted share to exclude the change in fair value of foreign exchange forward contracts to be consistent with its definition of Adjusted EBITDA. Prior period amounts have been adjusted to conform to current period presentation.

First Nine Months of Fiscal 2025 Results

Net sales for the first nine months of fiscal 2025 decreased $85.0 million, or 6.1%, to $1,309.2 million compared with the same period of the prior fiscal year. Net income was $73.9 million ($4.79 per diluted share and 5.6% of net sales) compared with $89.4 million ($5.46 per diluted share and 6.4% of net sales) in the same period of the prior fiscal year. Net income for the first nine months of fiscal 2025 decreased $15.5 million due to lower net sales, manufacturing volume deleverage in our new locations in Hamlet, North Carolina, and Monterrey, Mexico, increasing supply chain costs, unfavorable mark-to-market adjustment on our foreign currency hedging instruments, and restructuring charges totaling $1.7 millionrelated to a reduction in force implemented during the second quarter and the closure of the manufacturing facility located in Orange, Virginia, which was announced in January 2025, partially offset by the roll-off of acquisition-related intangible asset amortization, which ended in the third quarter of the prior fiscal year, non-recurring pre-tax charge related to the plywood case last fiscal year, and lower year-over-year incentive compensation. Adjusted EPS per diluted share was $5.28 for the first nine months of fiscal 2025 compared with $6.81¹ in the same period of the prior fiscal year. Adjusted EBITDA for the first nine months of fiscal 2025 decreased $36.6 million, or 18.5%, to $161.5 million, or 12.3% of net sales, compared to $198.1 million, or 14.2% of net sales, for the same period of the prior fiscal year.

Balance Sheet & Cash Flow

As of January 31, 2025, the Company had $43.5 million in cash plus access to $314.2 million of additional availability under its revolving credit facility. Also, as of January 31, 2025, the Company had $198.8 million in term loan debt and $173.4 million drawn on its revolving credit facility. 

Cash provided by operating activities for the first nine months of fiscal 2025 was $63.7 million and free cash flow totaled $31.5 million. 

The Company repurchased 132,075 shares, or approximately 1.0% of shares outstanding, for $12.6 million during the third quarter of fiscal 2025, and 752,412 shares, or approximately 5.0% of shares outstanding, for $69.1 million during the first nine months of fiscal 2025. As of January 31, 2025, $145.4 million remained available from the amount authorized by the Board to repurchase the Company’s common stock.

Fiscal 2025 Financial Outlook

For fiscal 2025 (which includes the now completed first nine months) the Company expects:

• Mid single-digit decline in net sales year-over-year
• Adjusted EBITDA in the range of $210 million to $215 million

“The Company has delivered resilient performance during this period of declining volumes and macroeconomic headwinds. Our team has laid a solid foundation in all our functions that will position the company for profitable growth once our volumes return,” stated Paul Joachimczyk, Senior Vice President and Chief Financial Officer. “We have been, and continue to remain, committed to our capital investment strategy for the company and will continue driving returns for our shareholders as shown by repurchasing 5.0% of our shares outstanding during the first nine months of fiscal 2025.”

Our Adjusted EBITDA outlook excludes the impact of certain income and expense items that management believes are not part of underlying operations. These items may include restructuring costs, interest expense, stock-based compensation expense, and certain tax items. Our management cannot estimate on a forward-looking basis the impact of these income and expense items on its reported net income, which could be significant, are difficult to predict, and may be highly variable. As a result, the Company does not provide a reconciliation to the closest corresponding GAAP financial measure for its Adjusted EBITDA outlook.

For full results click here.

About American Woodmark

American Woodmark celebrates the creativity in all of us. With over 8,800 employees and more than a dozen brands, we’re one of the nation’s largest cabinet manufacturers. From inspiration to installation, we help people find their unique style and turn their home into a space for self-expression. By partnering with major home centers, builders, and independent dealers and distributors, we spark the imagination of homeowners and designers and bring their vision to life. Across our service and distribution centers, our corporate office, and manufacturing facilities, you’ll always find the same commitment to customer satisfaction, integrity, teamwork, and excellence. Visit americanwoodmark.com to learn more and start building something distinctly your own.

Contact:

Kevin Dunnigan – VP & Treasury Director – (540) 665-9100

Source: American Woodmark Corporation