Earnings Review and Free Research Report: GMS Generated Record Revenue; GAAP Net Income Soared 61%

LONDON, UK / ACCESSWIRE / July 12, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on GMS Inc. (NYSE: GMS), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=GMS, following the Company’s disclosure of its fourth quarter and fiscal 2017 earnings results on June 29, 2017. The leading North American distributor of wallboard and suspended ceilings systems, outperformed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

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At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on GMS. With the links below you can directly download the report of your stock of interest-free of charge at:

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Earnings Reviewed

GMS’ net sales for the fourth quarter of fiscal 2017 ended April 30, 2017, were a record $615.0 million, up 17% compared to $527.2 million for the fourth quarter of fiscal 2016 ended April 30, 2016. The Company’s revenue numbers surpassed analysts’ estimates of $614.93 million. GMS’ net sales for the fiscal year ended April 30, 2017, increased 24.8% to $2.32 billion compared to $1.86 billion for FY16.

During Q4 FY17, GMS’ gross profit surged 15.4% to $201.0 million compared to $174.2 million in Q4 FY16, primarily attributable to pricing discipline, improved purchasing opportunities and product mix. The Company’s gross margin was 32.7% for the reported quarter versus 33.0% in the prior year’s comparable quarter.

GMS’ adjusted EBITDA rose 19.5% to $52.1 million in Q4 FY17 compared to $43.6 million in Q4 FY16. The Company’s adjusted EBITDA margin was 8.5% as a percentage of net sales for the reported quarter compared to 8.3% in the year earlier same quarter, largely reflecting increased profitability on higher net sales.

For Q4 FY17, GMS posted net income of $14.3 million, or $0.34 per diluted share, increased $5.3 million, or 61% compared to $8.9 million, or $0.27 per diluted share, in Q4 FY16. The Company’s adjusted net income totaled $20.0 million, or $0.48 per diluted share, for the reported quarter, compared with $17.4 million, or $0.53 per diluted share, in the corresponding year-ago quarter. GMS earnings surpassed Wall Street’s expectations of $0.46 per share.

GMS’ net income for FY17 totaled $48.9 million, or $1.19 per diluted share, gaining $36.3 million compared to $12.6 million, or $0.38 per diluted share, in FY16. The Company’s adjusted net income for the reported period totaled $69.9 million, or $1.70 per diluted share, from $47.4 million, or $1.43 per diluted share, in the year-ago comparable period.

Segment Results

During Q4 FY17, GMS’ Wallboard sales of $282.2 million increased 13.4% on a y-o-y basis. In the reported quarter, Wallboard unit volume grew 11.1% to 906 million square feet, driven by improved end market demand, price gains, and the positive contribution from acquisitions.

The Company’s Ceilings sales advanced 11.9% to $87.5 million in the reported quarter, principally attributed to greater commercial activity, price gains, and the positive impact from acquisitions.

In Q4 FY17, GMS’ Steel framing sales surged 28.9% to $100.2 million, primarily due to greater commercial activity, price gains as a result of higher industry steel prices and acquisitions. The Company’s other product sales of $145.1 million rose 18.5% on y-o-y basis, as a result of strong demand pull through, strategic initiatives, improved pricing, and acquisitions.

Capital Resources

As of April 30, 2017, GMS had cash of $14.6 million and total debt of $595.0 million compared to cash of $19.1 million and total debt of $644.6 million at April 30, 2016.

Subsequent to the end of fiscal 2017, on June 07, 2017, GMS amended its First Lien Credit Agreement with new borrowings consisting of a $578 million term loan facility due in 2023. Borrowings under the new term loan bear interest at a floating rate based on LIBOR, with a 1.00% floor, plus 3.00%, representing a 50 basis point improvement compared to the previous term loan’s interest rate. The Company utilized the net proceeds from the new term loan to repay the Company’s previous first lien term loan of $478 million and approximately $94 million of loans under the asset-based revolving credit facility as well as related expenses.

Acquisition Activity

In February 2017, GMS acquired the Hawaiian distribution assets of Grabber Construction Products, Inc., a highly regarded supplier of fasteners and drywall related products, based in Honolulu, Hawaii. During FY17, the Company’s eight acquisitions completed generated an aggregate of approximately $215.9 million in net sales for the twelve month period prior to the date of acquisition.

Stock Performance

GMS Inc.’s share price finished yesterday’s trading session at $27.24, sliding 1.59%. A total volume of 552.75 thousand shares have exchanged hands, which was higher than the 3-month average volume of 400.86 thousand shares. The Company’s stock price rallied 12.84% in the previous twelve months. Shares of the Company have a PE ratio of 22.89 and currently have a market cap of $1.13 billion.

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