Owens Corning Delivers Full-Year Net Sales of $9.7 Billion; Generates Earnings of $1.2 Billion and Adjusted EBIT of $1.8 Billion

Owens Corning, a global building and construction materials leader, reported fourth-quarter and full-year 2023 results.

• Reported Net Sales of $9.7 Billion, Down Slightly from Prior Year
• Expanded 2023 Adjusted EBIT Margins to 19% and Adjusted EBITDA Margins to 24%
• Delivered Diluted EPS of $13.14 and Adjusted Diluted EPS of $14.42
• Generated Operating Cash Flow of $1.7 Billion and Free Cash Flow of $1.2 Billion
• Returned $812 Million, or 68%, of Free Cash Flow to Shareholders through Dividends and Share Repurchases

“These outstanding results for the fourth quarter and full year demonstrate the strength of our team, the value of our products, and the impact of our enterprise strategy to increase the earnings power of the company and create value for our customers and shareholders,” said Chair and Chief Executive Officer Brian Chambers. “Looking ahead, we will continue to focus on delivering outstanding results in the near-term as we execute the strategic moves announced last week which will further strengthen our leadership in building and construction materials and position the company for long-term success.”

Enterprise Strategy Highlights

• On February 9, Owens Corning announced it entered into a definitive agreement to acquire Masonite International Corporation, a leading global provider of interior and exterior doors and door systems. The addition of Masonite’s doors business will strengthen Owens Corning’s position in building and construction materials. The transaction is expected to close mid-2024.
• Owens Corning also announced on February 9 that it will review strategic alternatives for its global glass reinforcements business. This decision to review the business is consistent with the company’s strategy to focus on building and construction materials. Glass reinforcements generates annual revenue of approximately $1.3 billion.
• Owens Corning is updating the long-term EBIT margin guide for the Roofing segment from approximately 20% to mid-20% on average.
• Owens Corning continues to invest in new product and process innovation to support customers and generate additional growth. In 2023, it launched 39 new or refreshed products.
• Owens Corning sustained a high level of safety performance in 2023 with a recordable incident rate (RIR) of 0.60.
• Owens Corning continues to be recognized as a leader in environmental, social, and governance. In the fourth quarter, the company earned a place on the Dow Jones Sustainability World Index for the 14^th consecutive year.

Cash Returned to Shareholders

• During 2023, the company returned $812 million to shareholders through dividends and share repurchases. The company paid dividends of $188 million and repurchased 5.4 million shares of common stock for $624 million.
• In December 2023, Owens Corning announced its Board of Directors declared quarterly cash dividends of $0.60 per common share, a 15% increase compared with the associated prior quarterly dividends.

“In 2023, the strength of our earnings and disciplined capital allocation resulted in $1.2 billion of free cash flow, with 68% returned to shareholders through share repurchases and dividends,” said Executive Vice President and Chief Financial Officer Todd Fister. “As we look forward to 2024, we remain committed to maintaining our investment grade balance sheet, investing in attractive acquisitions and capital projects to continue to grow our earnings power, and returning 50% of free cash to shareholders over time.”

Other Notable Highlights

• Owens Corning expects to issue its 18th annual Sustainability Report next month. The report will highlight the company’s progress toward its 2030 sustainability goals.

2023 Segment Performance

Full-Year

• Roofing net sales increased 10% to $4.0 billion in 2023 compared to 2022, with strong year-over-year demand driven primarily by higher levels of storm activity, in addition to positive price and favorable mix. EBIT increased $343 million to $1.2 billion, with 29% EBIT margins and 31% EBITDA margins. The EBIT improvement was primarily due to positive price, favorable input costs and delivery, higher volumes, and favorable mix for the full year.
• Insulation net sales decreased slightly to $3.7 billion in 2023 compared to 2022, primarily due to lower sales volumes in both the North American residential insulation and technical and global insulation businesses, which were largely offset by positive price, favorable delivery costs, and mix. EBIT increased $7 million to $619 million, with 17% EBIT margins and 23% EBITDA margins, with positive price and favorable mix more than offsetting the impact of lower volumes, input cost inflation, higher manufacturing costs, and planned maintenance downtime and production investments.
• Composites net sales decreased 14% to $2.3 billion in 2023, primarily due to lower volumes and the net impact of divestitures and acquisitions. EBIT decreased $256 million to $242 million while delivering 11% EBIT margins and 18% EBITDA margins. The EBIT decline was driven by lower demand, primarily in glass reinforcements, the associated production downtime actions the company took throughout the year to balance inventories, and the net impact of divestitures and acquisitions. Input costs were inflationary for the year, largely offset by favorable delivery costs.

Fourth-Quarter

• Roofing net sales increased 16% to $928 million in fourth-quarter 2023 compared with fourth-quarter 2022, with continued strong demand tied to the mild weather extending the roofing season in many regions and strong components attachment rate, as well as favorable mix and positive price. EBIT increased $116 million to $284 million, expanding EBIT margins to 31% and EBITDA margins to 32%. The EBIT improvement was due to higher volumes, favorable input and delivery costs, as well as positive price, favorable mix, and favorable manufacturing costs.
• Insulation net sales decreased 3% to $931 million in fourth-quarter 2023 compared with fourth-quarter 2022. The change was primarily due to lower volumes in both the North American residential insulation and technical and global insulation businesses, partially offset by favorable price and mix. EBIT decreased $3 million to $150 million, with 16% EBIT margins and 22% EBITDA margins, as the year-over-year impact of lower volumes was largely offset by positive price realization.
• Composites net sales decreased 13% to $514 million in fourth-quarter 2023 compared with fourth-quarter 2022, primarily due to lower volumes and price declines resulting from lower spot prices in glass reinforcements. EBIT decreased $38 million to $26 million, with EBIT margins of 5% and EBITDA margins of 13%. In addition to price, the impact of lower demand in glass reinforcements and the actions the company took to balance inventories with corresponding production downtime contributed to the year-over-year EBIT declines, which were partially offset by favorable manufacturing performance.

First-Quarter and Full-Year 2024 Outlook

• The key economic factors that impact the company’s business are residential repair and remodeling activity, U.S. housing starts, global commercial construction activity, and global industrial production.
• Macroeconomic trends outside of the U.S. and elevated interest rates continue to result in slow global economic growth, but the company expects most of its building and construction end markets to be relatively stable in the near term.
• For the first-quarter 2024, the company expects overall performance to result in net sales slightly below the first quarter of 2023, while generating mid-teens margins.

For the full fourth quarter results, click here.

About Owens Corning

Owens Corning is a global building and construction materials leader committed to building a sustainable future through material innovation. Our three integrated businesses – Roofing, Insulation, 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 approximately 18,000 employees in 30 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.

Contact:

Amber Wohlfarth – Vice President, Investor Relations – Amber.Wohlfarth@owenscorning.com – (419) 248-5639

Source: Owens Corning