JELD-WEN Holding, Inc. (JELD) Q1 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reveals significant financial challenges, including a 19% revenue decline, increased net debt leverage, and negative cash flow. Despite cost reduction efforts, the guidance indicates further revenue declines and weak EBITDA improvements. The Q&A highlighted management's uncertainty in passing tariff costs to customers and muted seasonal growth expectations. The absence of a share repurchase program and unclear responses to key risks further dampen sentiment. Considering the small-cap market cap, these factors suggest a negative stock price movement of -2% to -8% over the next two weeks.
Key Financial Performance
Revenue $776 million, a 19% decline year-over-year; decline attributed to 15% lower core revenues due to volume reductions and 4% from the divestiture of Towanda operations.
Adjusted EBITDA $22 million, a decrease of $47 million year-over-year; decline driven by significantly lower volumes and slightly unfavorable mix, resulting in an adjusted EBITDA margin of 2.8%.
Free Cash Flow Use of $125 million, compared to a $46 million use in Q1 2024; decline driven by lower EBITDA and unfavorable working capital dynamics, with working capital being a $30 million use this quarter.
Net Debt Leverage Ratio Increased to 4.6x, exceeding the targeted range of 2 to 2.5x; increase attributed to pressure from lower EBITDA and continued investment in transformation initiatives.
North America Revenue $531 million, a 22% decline year-over-year; decline primarily driven by a 17% decrease in core revenues due to lower volumes.
North America Adjusted EBITDA $16 million, down from $61 million year-over-year; decline reflects lower volumes, unfavorable price cost dynamics, and productivity challenges.
Europe Revenue $245 million, down 12% year-over-year; decline driven almost entirely by lower volume.
Europe Adjusted EBITDA $11 million, a decline of $4 million from the prior year, resulting in an adjusted EBITDA margin of 4.3%; decline attributed to reduced volume and modestly negative price cost pressures.
Tariff Impact Estimated annualized impact of approximately $55 million, with $30 million expected to affect 2025 results; anticipated to be offset by passing costs through to customers.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Revenue: Revenue for Q1 2025 was $776 million, a 19% decline year-over-year, primarily due to lower core revenues and the divestiture of the Towanda operations.
Adjusted EBITDA: Adjusted EBITDA for Q1 2025 was $22 million, a decrease of $47 million compared to the prior year, driven by lower volumes and unfavorable mix.
Tariff Impact: Estimated annualized tariff impact is approximately $55 million, with $30 million expected to affect 2025 results.
Market Conditions: Current macroeconomic environment is challenging, with elevated interest rates and declining consumer confidence, impacting new home construction and repair activity.
New Business Initiatives: Collaborating with builders to reduce costs and enhance service experience, securing new business ahead of internal plans.
Operational Efficiencies: Significant headcount reductions and workflow consolidations to align operations with current order rates.
Production Capabilities: Enhancements at the Florida facility resulted in improved product quality and on-time performance metrics.
Transformation Initiatives: Expected to achieve approximately $100 million in ongoing transformation benefits and $50 million from short-term actions.
Strategic Priorities: Focus on reestablishing customer partnerships, optimizing manufacturing and distribution networks, and investing in automation for efficiency.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Market Demand Risks: The company is experiencing a soft demand environment, with both North America and Europe segments facing double-digit volume declines. This has led to a withdrawal of full-year guidance due to significant short-term volatility.
Tariff Risks: Ongoing tariff situations have introduced planning uncertainty, with an anticipated annualized impact of approximately $55 million, of which $30 million is expected to affect 2025 results. Although the company plans to pass these costs to customers, the demand implications remain unpredictable.
Economic Factors: The macroeconomic environment is challenging, with elevated interest rates, declining consumer confidence, and a 50% likelihood of a global recession. These factors are negatively impacting new home construction and repair/remodel activity.
Operational Challenges: The company faces ongoing productivity headwinds, as costs have not decreased at the pace required to offset lower demand levels. Additionally, operational inefficiencies have arisen from reduced manufacturing throughput.
Financial Performance Risks: The company reported a 19% decline in revenue year-over-year, with adjusted EBITDA down by $47 million. The net debt leverage ratio increased to 4.6x, exceeding the targeted range of 2 to 2.5x, raising concerns about financial stability.
Supply Chain Risks: The company has limited direct exposure to tariffs, with only 13% of Tier 1 and Tier 2 supplier spend exposed. However, the evolving tariff situation may lead to significant supply chain optimization activities.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Transformation Initiatives: We expect our transformation initiatives this year to achieve approximately $100 million in ongoing transformation benefits and $50 million of additional benefits from short-term actions.
Capital Expenditures: We anticipate investing approximately $150 million in capital expenditures this year.
Strategic Priorities: 1. Reestablish strong partnerships with customers by enhancing service levels and reducing lead times. 2. Optimize manufacturing and distribution network to balance capacity and improve customer service. 3. Invest in automation to drive efficiency and reduce costs.
Adjusted EBITDA Outlook: We anticipate that our second quarter adjusted EBITDA will be slightly above first quarter levels.
Market Conditions: We expect continued softness in demand in North America across both new construction and repair and remodel segments.
Debt Leverage Ratio: Our net debt leverage ratio increased to 4.6x, exceeding our targeted range of 2 to 2.5x.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Share Repurchase Program: None
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:How confident are you in your ability to pass along the $30 million in 2025 tariff impact to your customers?
A:We are in constant negotiation with our key customers as the tariff reality evolves. Negotiations are going well, and we are working with suppliers on reshoring opportunities. We don't see significant challenges in getting the surcharges into the market.
Q:How should we think about the phrasing of your outlook that 2Q EBITDA will be slightly better seasonally compared to the first quarter?
A:We typically experience a seasonal uptick in 2Q versus 1Q, but this year it is muted. We expect a quarter-over-quarter uptick, but off a low base.
Q:How should we think about the flow-through of the $150 million in mitigation actions from transformation and cost out in the back half?
A:Roughly 40-60% of the benefits will drop through in H2, but it depends on how volumes develop.
Q:How are you managing liquidity risk and improving your balance sheet in the near to medium term?
A:We are closely managing working capital and reviewing every CapEx request. We are evaluating options like sale-leaseback or asset sales to strengthen our balance sheet.
Q:Are you seeing or thinking about the potential that being a largely U.S.-based producer could help you regain some market share?
A:Yes, we see opportunity, especially in areas like fiberglass doors due to tariff levels making imports prohibitive.
Q:Can you talk about your efforts to improve service levels and reduce lead times to customers?
A:We are investing in automation and optimizing our cost structure, but we are also aware of the softness in the market.
Q:Can you provide an update on the Towanda divestiture and its impact?
A:We are seeing slightly more towards the higher end of the EBITDA range from the divestiture.
Q:How far along are you in standardizing and building specifications across your manufacturing network?
A:We are making progress, particularly in optimizing cost to serve and reducing product complexity.
Q:Will the new business wins with builder customers be a volume benefit in the second half?
A:Yes, but it will be small and not material in the grand scheme of things.
Q:What would cause you to change your view on CapEx?
A:We have flexibility with CapEx and will reduce it if the market develops negatively.
Q:Can you clarify your liquidity position and covenants on your revolver?
A:We do not have restrictive covenants on our revolver and have ample liquidity for the foreseeable future.
Q:Review of Unclear Management Responses
A:Management appeared to avoid giving a direct answer regarding the specific impact of tariffs on the macroeconomic landscape and how it will affect demand. Their response lacked clarity on the exact timing and magnitude of the tariff impact on sales and EBITDA.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Capital
Europe segment
Samantha
Tier supplier
approach
cost dynamic
cost pressure
court order
decline core
decrease volume
dedication
disruption
distribution
exposure
impact
improvement safety
insight market
leverage
manufacturing
market challenge
market dynamic
material
moment
order divestiture
outcome
partnership
plan
priority
product mix
product quality
productivity challenge
recession
reduction North
service
situation
sprint
support
tariff level
term success
timing
topic
turbulence
use
volume reduction
JELD Transcript
JELD-WEN Holding, Inc. (JELD) Q3 2025 Earnings Call Transcript
Unknown11-4
The earnings call reveals significant challenges: declining volumes, aggressive competitor pricing, and reduced EBITDA expectations. Although there are transformation initiatives and cost-saving measures, the market conditions remain weak, and guidance indicates ongoing struggles. The potential business sale is uncertain, and management's vague responses further amplify concerns. Given the market cap of $1.12 billion, the stock is likely to experience a negative reaction, falling between -2% to -8% over the next two weeks.
JELD-WEN Holding, Inc. (JELD) Q2 2025 Earnings Call Transcript
Unknown8-6
The earnings call reveals a challenging financial situation with declining revenues, high leverage, and negligible free cash flow. Despite plans for improvement, the immediate outlook remains weak. The Q&A section highlights concerns about financial leverage and lack of clarity on strategic actions. The company's market cap suggests moderate stock price sensitivity, but the overall sentiment is negative due to financial underperformance and uncertainties.
JELD-WEN Holding, Inc. (JELD) Q1 2025 Earnings Call Transcript
Unknown5-6
The earnings call reveals significant financial challenges, including a 19% revenue decline, increased net debt leverage, and negative cash flow. Despite cost reduction efforts, the guidance indicates further revenue declines and weak EBITDA improvements. The Q&A highlighted management's uncertainty in passing tariff costs to customers and muted seasonal growth expectations. The absence of a share repurchase program and unclear responses to key risks further dampen sentiment. Considering the small-cap market cap, these factors suggest a negative stock price movement of -2% to -8% over the next two weeks.
JELD-WEN Holding, Inc. (NYSE:JELD) Q4 2024 Earnings Call Transcript
Unknown2-19
The earnings call indicates a challenging financial landscape with declining revenues and EBITDA, increased debt leverage, and downward-revised guidance for 2024. Despite cost-saving initiatives and transformation projects, the weak financial performance and cautious outlook, especially in key markets like North America, suggest a negative sentiment. The Q&A highlights management's uncertainty in addressing cost challenges and inflation, further supporting a negative outlook. Given the small-cap status, the stock is likely to react more strongly to these negative factors, resulting in a predicted stock price movement of -2% to -8% over the next two weeks.
JELD Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
