Builders FirstSource Launches $500 Million Senior Notes Offering Due 2035

On May 5, 2025, Builders FirstSource, Inc. (NYSE: BLDR) announced it has launched an offering of $500 million in unsecured Senior Notes due 2035. The net proceeds will be used to repay debt under the company's Asset-Based Lending (ABL) Facility.
The notes will be offered only to qualified institutional buyers under Rule 144A and to non-U.S. persons outside the U.S. under Regulation S. They will not be registered under the Securities Act and cannot be sold in the U.S. without an exemption.
Completion of the offering is subject to market conditions, and there is no assurance the transaction will be finalized.
Builders FirstSource, headquartered in Irving, Texas, is the largest U.S. supplier of building products and services for new residential construction and remodeling, operating in 43 states with nearly 600 locations.

Builders FirstSource reported first quarter 2025 results showing a decline in performance compared to the prior year.

Net sales fell 6% to $3.66 billion due to lower core organic sales, one fewer selling day, and commodity deflation, partly offset by acquisitions. Gross margin dropped 290 basis points to 30.5%, with net income falling 62.8% to $96.3 million, or $0.84 per diluted share, compared to $2.10 in Q1 2024. Adjusted EBITDA declined 31.7% to $369.2 million, with a margin of 10.1%. Free cash flow decreased sharply to $45.0 million from $227.6 million.

Sales in key segments showed declines: Single-Family fell 5.9% and Multi-Family dropped 32.7%, while Repair and Remodel grew 3.6%. The company repurchased $12.8 million in shares in Q1 and $390.9 million in April. Liquidity at quarter-end stood at $1.1 billion, with net debt of $4.4 billion and a leverage ratio of 2.0x.

For the full year 2025, the company projects:
- net sales of $16.05–$17.05 billion
- adjusted EBITDA of $1.7–$2.1 billion
- adjusted EBITDA margin of 10.6%–12.3%
- free cash flow between $800 million and $1.2 billion

Builders FirstSource reported a decline in revenue and profitability for the fourth quarter and full-year 2024, reflecting the impact of lower core organic sales and commodity deflation. Fourth-quarter net sales dropped 8.0% year-over-year to $3.8 billion, primarily due to an 8.8% decline in core organic sales and a 3.1% impact from commodity deflation, partially offset by a 2.5% contribution from acquisitions. Gross margin decreased 300 basis points to 32.3%, driven by margin normalization in the Single-Family and Multi-Family segments.

Net income for the quarter was $190.2 million, a 45.8% decline from the previous year, with diluted earnings per share (EPS) at $1.65, compared to $2.83 in Q4 2023. Adjusted EBITDA fell 28.0% to $493.6 million, while the adjusted EBITDA margin declined by 360 basis points to 12.9%.

For the full year, Builders FirstSource generated $1.9 billion in cash from operations, with free cash flow of $1.5 billion. The company repurchased 8.9 million shares for $1.5 billion, reducing its total outstanding shares by 6.8%. CEO Peter Jackson emphasized the company’s resilience despite market challenges, attributing success to operational excellence and continued investments in value-added solutions and technology.

Looking ahead, CFO Pete Beckmann highlighted the company’s commitment to maintaining financial flexibility, executing its balanced capital allocation strategy, and driving long-term shareholder value through organic growth and strategic acquisitions.