Doman Building Materials Group Ltd. Announces Third Quarter 2022 Financial Results

Doman Building Materials Group Ltd. (“Doman” or “the Company”) announced its third quarter 2022 financial results⁽¹⁾ for the period ended September 30, 2022.

Q3 2022 Financial Highlights⁽¹⁾:

• Revenues increased by 19.0% to $744.1 million
• Gross Margin at 12.3%
• Adjusted EBITDA⁽³⁾ amounted to $40.0 million
• Net Earnings⁽⁴⁾ amounted to $11.6 million
• Quarterly dividend of $0.14 per share paid, the Company’s 50^th consecutive quarterly dividend⁽⁴⁾

For the three-month period ended September 30, 2022⁽¹⁾, consolidated revenues increased by 19.0% to $744.1 million, compared to $625.3 million in 2021, largely due to the impact of construction materials pricing, which remained relatively consistent throughout the third quarter of 2022, compared with sharp pricing declines during the prior year quarter. The Company’s sales by product group in the quarter were made up of 72% construction materials, with the remaining balance of sales resulting from specialty and allied products of 24%, and other of 4%.

Gross margin dollars increased to $91.5 million, compared to $80.7 million in 2021. Gross margin percentage was 12.3%, representing a slight decrease from the 12.9% achieved in the same quarter of 2021.

Revenues and gross margin continued to be impacted by underlying pricing trends, with prices peaking as a result of inflationary pressures earlier in the year, but then declining sharply again during the second and third quarters. The recent jump in interest rates and the expectation of a slowing North American housing market also cooled consumers’ demand and resulted in further pricing volatility during the third quarter.

EBITDA⁽²⁾ for the third quarter amounted to $40.0 million, compared to EBITDA and Adjusted EBITDA of $33.2 million, and $34.5 million, respectively, during the same period in 2021. Adjusted EBITDA in the third quarter of 2021 included $1.3 million in non-recurring acquisition related costs. Net earnings for the three-month period ended September 30, 2022, were $11.6 million versus $7.7 million in the comparative period of 2021.

The Company declared a $0.14 per share⁽⁴⁾ quarterly dividend during the third quarter, which was paid on October 14, 2022, to shareholders of record at the close of business on September 30, 2022.

For the nine-month period ended September 30, 2022⁽¹⁾, the Company generated EBITDA and Adjusted EBITDA of $170.2 million, on revenues of $2.5 billion. Gross margin and gross margin percentage during the period amounted to $326.8 million, and 13.3%, respectively. This compares to 2021 EBITDA and Adjusted EBITDA of $183.7 million, and $188.6 million, respectively, on revenues of $1.9 billion. Gross margin and gross margin percentage during the 2021 period amounted to $302.3 million and 15.9%. Net earnings for the nine-month period ended September 30, 2022, were $74.4 million versus $94.9 million in the comparative period of 2021.

“Despite all the macroeconomic headwinds of late, and the continued pricing volatility for our inputs and finished products, I am very pleased with our ability to demonstrate continued top line growth while stabilizing gross margin. Additionally, I am proud to report that our total debt has been reduced by $103 million since September 2021,” commented Amar S. Doman, Chairman of the Board. “We continue to see robust market growth opportunity in the long term for our business as a preeminent supplier of building materials in North America.”

For the full third quarter results, click here.

About Doman Building Materials Group Ltd.

Doman is headquartered in Vancouver, British Columbia and trades on the Toronto Stock Exchange under the symbol DBM and is a leading North American distributor of building materials and is Canada’s only fully integrated national distributor in the building materials and related products sector. Doman operates several distinct divisions: CanWel Building Materials with multiple treating plant, planing facilities and distribution centres coast-to-coast in all major cities and strategic locations across Canada; founded in 1959, Hixson Lumber Company in the central United States, with 19 treating plants, two specialty planing mills and five specialty sawmills located in eight states, headquartered in Dallas, Texas, distributing, producing and treating lumber, fencing and building materials; California Cascade in the western United States near Portland, Oregon, San Francisco and Los Angeles, California with treating facilities and distribution of building materials, lumber and renovation products; founded in 1935, the Honsador Building Products Group in 14 locations in the State of Hawaii, with treating facilities, truss plants and distribution of a wide range of building materials, lumber, renovation and electrical products. In addition, through its CanWel Fibre division, the Company operates a vertically integrated forest products company based in Western Canada, operating from British Columbia to Saskatchewan, also servicing the US Pacific Northwest. CanWel Fibre owns approximately 117,000 acres of private timberlands, strategic licenses and tenures, several post and pole peeling facilities and two pressure-treated specialty wood production plants and a specialty sawmill. Please see our filings on SEDAR under Doman Building Materials Group Ltd. (formerly, CanWel Building Materials Group Ltd.) for additional information.

Contact:

Ali Mahdavi – Investor Relations – ali.mahdavi@domanbm.com – (416) 962-3300

Source: Doman Building Materials Group Ltd.