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Section 1: 8-K (8-K)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 8-K

 


 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): June 28, 2018

 


 

GMS INC.

(Exact name of registrant as specified in charter)

 


 

Delaware

 

001-37784

 

46-2931287

(State or Other Jurisdiction
of Incorporation)

 

(Commission
File Number)

 

(I.R.S. Employer
Identification No.)

 

100 Crescent Centre Parkway, Suite 800
Tucker, Georgia

 

30084

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (800) 392-4619

 


 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company  o

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  o

 

 

 



 

Item 2.02. Results of Operations and Financial Condition.

 

On June 28, 2018, GMS Inc. (the “Company” or “GMS”) issued a press release, a copy of which is furnished as Exhibit 99.1 hereto and incorporated herein by reference, announcing the Company’s financial results for the fourth quarter and fiscal year ended April 30, 2018.

 

The information contained in Item 7.01 concerning the presentation to GMS investors is hereby incorporated into this Item 2.02 by reference.

 

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 2.02 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 attached hereto, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 7.01. Regulation FD Disclosure.

 

The slide presentation furnished as Exhibit 99.2 hereto, and incorporated herein by reference, will be presented to certain investors of GMS on June 28, 2018 and may be used by GMS in various other presentations to investors on or after June 28, 2018.

 

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.2 attached hereto, shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit

 

Description

99.1*

 

Press release, dated June 28, 2018.

99.2*

 

GMS Inc. presentation to investors.

 


*Furnished herewith

 

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EXHIBIT INDEX

 

Exhibit

 

Description

99.1*

 

Press release, dated June 28, 2018.

99.2*

 

GMS Inc. presentation to investors.

 


*Furnished herewith

 

3



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

GMS INC.

 

 

 

 

Date: June 28, 2018

By:

/s/ H. Douglas Goforth

 

 

Name:

H. Douglas Goforth

 

 

Title:

Chief Financial Officer

 

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Section 2: EX-99.1 (EX-99.1)

Exhibit 99.1

 

 

GMS REPORTS RESULTS FOR FOURTH QUARTER AND FISCAL 2018

- Net Sales of $635.8 Million for the Quarter -

- Adjusted EBITDA of $50.1 Million for the Quarter -

- Completed Acquisition of WSB Titan Subsequent to Quarter End -

 

Tucker, Georgia, June 28, 2018. GMS Inc. (NYSE:GMS), a leading North American distributor of wallboard and suspended ceilings systems, today reported financial results for the fiscal fourth quarter and fiscal year ended April 30, 2018.

 

Revenues for the fiscal fourth quarter ended April 30, 2018 increased 3.4% to a record $635.8 million from $615.0 million for the fiscal fourth quarter ended April 30, 2017. Net income declined to $9.9 million, or $0.24 per diluted share, compared to $14.3 million, or $0.34 per diluted share. The decrease in net income is attributable to $3.0 million in pre-tax transaction costs and $5.1 million in pre-tax mark-to-market currency adjustments during the fourth quarter of fiscal 2018, both related to the acquisition of WSB Titan (“Titan”). In addition, the fourth quarter of fiscal 2017 included $1.2 million of non-recurring other income. Adjusted EBITDA decreased 3.9% for the fiscal fourth quarter to $50.1 million from adjusted EBITDA of $52.1 million from the fourth quarter of fiscal 2017.

 

Mike Callahan, President and CEO of GMS, stated, “We delivered a solid fourth quarter capping off a successful fiscal 2018. Subsequent to quarter end, we completed the acquisition of Titan, which strengthens GMS’s position as the market leader in wallboard distribution in North America and provides an additional platform with multiple levers to drive profitable growth. We were also pleased to deliver record sales for a third consecutive year and achieve our target of gross margin in excess of 32.5% for fiscal 2018.”

 

Mr. Callahan continued, “Looking ahead to fiscal 2019, the markets that we operate in remain healthy and we are encouraged that May sales increased 7% over last year as we finally started to experience favorable weather trends. We also initiated a strategic cost reduction plan in May of this year to improve our operational efficiency and demonstrate our strong commitment to expanding our margins, while continuing to invest in the areas of our business that we believe will provide the best return for our shareholders, business partners, and employees.  Excluding one-time, pre-tax severance related charges in the range of $4.1 to $4.6 million that we expect to record in the first quarter of fiscal 2019, we anticipate that the actions we have taken will generate payroll related and other cost savings of approximately $20.0 million on an annual basis. We will also continue to focus on successfully integrating Titan and look forward to implementing best practices across the combined organization to further expand total company margins over time.  I am excited about the overall strength of our business and confident in our ability to deliver another year of record sales and Adjusted EBITDA in fiscal 2019.”

 

Fourth Quarter 2018 Results

 

Net sales for the fourth quarter of fiscal 2018 ended April 30, 2018 were $635.8 million, compared to $615.0 million for the fourth quarter of fiscal 2017 ended April 30, 2017.

 

·                  Wallboard sales of $280.0 million decreased 0.8% compared to the fourth quarter of fiscal 2017, with wallboard unit volume decline of 3.1% to 878 million square feet offset by pricing improvement of 2.4%. Wallboard volume decline was partially driven by adverse weather conditions as well as continued challenging competitive dynamics.

 

·                  Ceilings sales of $95.6 million rose 9.3% compared to the fourth quarter of fiscal 2017, mainly due to greater commercial activity, pricing improvement and the positive impact of acquisitions.

 

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·                  Steel framing sales of $107.0 million grew 6.8% compared to the fourth quarter of fiscal 2017, mainly driven by pricing improvement.

 

·                  Other product sales of $153.2 million were up 5.6% compared to the fourth quarter of fiscal 2017, as a result of strategic initiatives, pricing improvement and the positive impact of acquisitions.

 

Gross profit of $205.8 million grew 2.4% compared to $201.0 million in the fourth quarter of fiscal 2017, mainly attributable to higher pricing and increased sales. Gross margin decreased by approximately 30 basis points to 32.4% compared to 32.7% in the fourth quarter of fiscal 2017 largely due to product mix.

 

Net income of $9.9 million, or $0.24 per diluted share, decreased by 30.5% or $4.4 million compared to $14.3 million, or $0.34 per diluted share, in the fourth quarter of fiscal 2017. Adjusted net income of $23.5 million, or $0.56 per diluted share, decreased $2.4 million, compared to $25.9 million, or $0.62 per diluted share, in the fourth quarter of fiscal 2017.

 

Adjusted EBITDA of $50.1 million decreased 3.9% compared to $52.1 million in the fourth quarter of fiscal 2017. Adjusted EBITDA margin was 7.9% as a percentage of net sales, down 60 basis points compared to the fourth quarter of fiscal 2017, impacted by the approximately 30 basis point decrease in gross margin and approximately 30 basis point increase in SG&A expense driven primarily by higher logistics costs.

 

Fiscal Year 2018 Results

 

Net sales for the fiscal year ended April 30, 2018 increased 8.3% to a record $2.51 billion, compared to $2.32 billion for the fiscal year ended April 30, 2017, with growth across all product categories.

 

Gross profit of $818.6 million in fiscal 2018 increased 7.9%, compared to $758.6 million in fiscal 2017. Gross margin of 32.6% decreased by 10 basis points, compared to 32.7% in the prior year, primarily due to lower margins in the first quarter of fiscal 2018.

 

Net income of $63.0 million in fiscal 2018, or $1.49 per diluted share, grew $14.1 million or 28.8%, compared to $48.9 million, or $1.19 per diluted share, in fiscal 2017. Adjusted net income of $84.7 million, or $2.01 per diluted share, increased $2.4 million, compared to $82.3 million, or $2.00 per diluted share, in the prior year.

 

Adjusted EBITDA grew 5.9% to a record $199.3 million in fiscal 2018, compared to $188.2 million in fiscal 2017. Adjusted EBITDA margin was 7.9% as a percentage of net sales in fiscal 2018, down slightly from 8.1% in fiscal 2017, primarily the result of a slight decrease in gross margin and a slight increase in SG&A.

 

Capital Resources

 

As of April 30, 2018, GMS had cash of $36.4 million and total debt of $595.9 million, compared to cash of $14.6 million and total debt of $594.9 million as of April 30, 2017.

 

Subsequent to the end of fiscal 2018, on June 1, 2018, the Company amended its First Lien Credit Agreement with new borrowings consisting of an approximately $997 million term loan facility due in 2025. Borrowings under the new term loan bear interest at a floating rate based on LIBOR, with a 0% floor, plus 2.75%, representing a 25 basis point improvement compared to the previous term loan’s interest rate. Net proceeds from the new term loan were used to repay the Company’s previous first lien term loan of approximately $572 million and to finance the acquisition of Titan.

 

Titan Update

 

GMS completed its acquisition of Titan on June 1, 2018. Titan’s unaudited results, including the impact of foreign currency exchange for the twelve months ended April 30, 2018, included net sales and Adjusted EBITDA of $478.4 million (C$612.1 million) and $68.4 million (C$87.5 million), respectively. This represents an increase of 17.4% in net sales and a 17.8% increase in Adjusted EBITDA compared to the twelve months ended April 30, 2017.  Based on an average monthly exchange rate of 0.7816 and excluding purchasing synergies, Titan is expected to contribute between $68.0 million and $72.0 million to Adjusted EBITDA for the eleven months ending April 30, 2019.

 

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The Company expects to record additional transaction related charges of $11.0 to $11.5 million in the first quarter of fiscal 2019, including an additional $5.7 million of mark-to-market currency adjustments. In addition, subject to finalization of the Titan purchase price allocation, inventory will be increased by an estimated $4.8 million (assuming an exchange rate of .7721 on June 1, 2018) to reflect its estimated fair value for purchase accounting purposes.  Cost of sales in the first quarter of fiscal 2019 will be increased by this amount as it will include the impact of this increase as the related inventory is sold.

 

Lease Accounting

 

As previously announced, in order to take advantage of the Tax Act’s accelerated depreciation provisions, facilitate the implementation of the new lease accounting standard which we will adopt in fiscal 2020, and improve the comparability of our financial statements with our publicly traded peers, effective May 1, 2018 we began financing the purchase of new commercial vehicles under capital leases and converted the majority of our legacy equipment operating leases into capital leases. We anticipate that this will reduce our SG&A expense and increase our Adjusted EBITDA by approximately $21.0 to $24.0 million per year beginning June 1, 2018. The conversion of our existing leases is also expected to increase the property and equipment and debt balances by approximately $75.0 million as of the first quarter of fiscal 2019.

 

Conference Call and Webcast

 

GMS will host a conference call and webcast to discuss its results for the fourth quarter and full fiscal year ended April 30, 2018 at 10:00 a.m. Eastern Time on June 28, 2018. Investors who wish to participate in the call should dial 800-289-0571 (domestic) or 323-794-2597 (international) at least 5 minutes prior to the start of the call. The live webcast will be available on the Investors section of the Company’s website at www.gms.com. There will be a slide presentation of the results available on that page of the website as well. Replays of the call will be available through July 28, 2018 and can be accessed at 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 6223894.

 

About GMS Inc.

 

Founded in 1971, GMS operates a network of more than 240 distribution centers across the United States and Canada. GMS’s extensive product offering of wallboard, suspended ceilings systems, or ceilings, and complementary construction products is designed to provide a comprehensive one-stop-shop for our core customer, the interior contractor who installs these products in commercial and residential buildings.

 

Use of Non-GAAP Financial Measures

 

GMS reports its financial results in accordance with GAAP. However, it presents Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin, which are not recognized financial measures under GAAP. GMS believes that Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin assist investors and analysts in comparing its operating performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance. The Company’s management believes Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin are helpful in highlighting trends in its operating results, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which the Company operates and capital investments.  In addition, the Company utilizes Adjusted EBITDA in certain calculations under its senior secured asset based revolving credit facility and its senior secured first lien term loan facility.

 

You are encouraged to evaluate each adjustment and the reasons GMS considers it appropriate for supplemental analysis. In addition, in evaluating Adjusted net income and Adjusted EBITDA, you should be aware that in the future, the Company may incur expenses similar to the adjustments in the presentation of Adjusted net income and Adjusted EBITDA. The Company’s presentation of Adjusted net income and Adjusted EBITDA should not be construed as an inference that its future results will be unaffected by unusual or non-recurring items. In addition, Adjusted net income and Adjusted EBITDA may not be comparable to similarly titled measures used by other companies in GMS’s industry or across different industries. Financial information related to Titan’s performance in periods prior to the acquisition included in this release were provided by Titan and are unaudited.

 

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Forward-Looking Statements and Information:

 

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You can generally identify forward-looking statements by the Company’s use of forward-looking terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “seek,” or “should,” or the negative thereof or other variations thereon or comparable terminology. In particular, statements about the markets in which GMS and Titan operates, including the potential for growth in the commercial, residential and repair and remodeling, or R&R, markets, statements about its expectations, beliefs, plans, strategies, objectives, prospects, assumptions or future events or performance, statements related to net sales, gross profit, gross margins and capital expenditures, as well as non-GAAP financial measures such as Adjusted EBITDA, Adjusted net income and base business growth, statements regarding the impact of the recent tax legislation and anticipated changes related to lease accounting, including the expected impact on the fiscal 2019 effective tax rate, SG&A and Adjusted EBITDA, and statements regarding potential acquisitions and future greenfield locations, demand trends and future SG&A savings contained in this press release are forward-looking statements. In addition, statements relating to the Titan acquisition, including its expected contribution to the Company’s Adjusted EBITDA for the eleven months ending April 30, 2019, are forward-looking statements. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond its control. Forward-looking statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of the Company’s control, that may cause its business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the prices, supply, and/or demand for products which GMS distributes; general economic and business conditions in the United States and Canada; the activities of competitors; changes in significant operating expenses; changes in the availability of capital and interest rates; adverse weather patterns or conditions; acts of cyber intrusion; variations in the performance of the financial markets, including the credit markets; the possibility that the expected synergies and cost savings and final impacts from the Titan acquisition will not be realized, or will not be realized within the expected time period; the risk that the GMS and Titan businesses will not be integrated successfully; disruption from the transaction making it more difficult to maintain business and operational relationships and to accomplish other GMS objectives; the risk of customer attrition; and other factors described in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2018, and in its other periodic reports filed with the SEC.  In addition, the statements in this release are made as of June 28, 2018. The Company undertakes no obligation to update any of the forward-looking statements made herein, whether as a result of new information, future events, changes in expectation or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to June 28, 2018.

 

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GMS Inc.

Condensed Consolidated Statements of Operations (Unaudited)

Three Months Ended April 30, 2018 and 2017 and Year Ended April 30, 2018 and 2017

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

April 30, 

 

April 30, 

 

 

 

2018

 

2017

 

2018

 

2017

 

Net sales

 

$

635,800

 

$

614,977

 

$

2,511,469

 

$

2,319,146

 

Cost of sales (exclusive of depreciation and amortization shown separately below)

 

430,008

 

413,942

 

1,692,893

 

1,560,575

 

Gross profit

 

205,792

 

201,035

 

818,576

 

758,571

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

161,645

 

152,962

 

633,877

 

585,078

 

Depreciation and amortization

 

15,982

 

17,761

 

65,530

 

69,240

 

Total operating expenses

 

177,627

 

170,723

 

699,407

 

654,318

 

Operating income

 

28,165

 

30,312

 

119,169

 

104,253

 

Other (expense) income:

 

 

 

 

 

 

 

 

 

Interest expense

 

(8,107

)

(7,198

)

(31,395

)

(29,360

)

Change in fair value of financial instruments

 

(5,415

)

(141

)

(6,125

)

(382

)

Write-off of debt discount and deferred financing fees

 

 

 

(74

)

(7,103

)

Other income, net

 

604

 

1,721

 

2,279

 

4,132

 

Total other expense, net

 

(12,918

)

(5,618

)

(35,315

)

(32,713

)

Income before taxes

 

15,247

 

24,694

 

83,854

 

71,540

 

Provision for income taxes

 

5,328

 

10,422

 

20,883

 

22,654

 

Net income

 

$

9,919

 

$

14,272

 

$

62,971

 

$

48,886

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

41,048

 

40,956

 

41,015

 

40,260

 

Diluted

 

42,151

 

41,759

 

42,163

 

41,070

 

Net income per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.24

 

$

0.35

 

$

1.54

 

$

1.21

 

Diluted

 

$

0.24

 

$

0.34

 

$

1.49

 

$

1.19

 

 

5



 

GMS Inc.

Condensed Consolidated Balance Sheets (Unaudited)

April 30, 2018 and 2017

(in thousands, except per share data)

 

 

 

April 30, 

 

April 30, 

 

 

 

2018

 

2017

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

36,437

 

$

14,561

 

Trade accounts and notes receivable, net of allowances of $9,633 and $9,851, respectively

 

346,450

 

328,988

 

Inventories, net

 

239,223

 

200,234

 

Prepaid expenses and other current assets

 

11,726

 

11,403

 

Total current assets

 

633,836

 

555,186

 

Property and equipment, net of accumulated depreciation of $85,761 and $71,409, respectively

 

163,582

 

154,465

 

Goodwill

 

427,645

 

423,644

 

Intangible assets, net

 

222,682

 

252,293

 

Other assets

 

6,766

 

7,677

 

Total assets

 

$

1,454,511

 

$

1,393,265

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

116,168

 

$

102,688

 

Accrued compensation and employee benefits

 

56,323

 

58,393

 

Other accrued expenses and current liabilities

 

45,146

 

37,891

 

Current portion of long-term debt

 

16,284

 

11,530

 

Total current liabilities

 

233,921

 

210,502

 

Non-current liabilities:

 

 

 

 

 

Long-term debt, less current portion

 

579,602

 

583,390

 

Deferred income taxes, net

 

10,742

 

26,820

 

Other liabilities

 

35,088

 

35,371

 

Liabilities to noncontrolling interest holders, less current portion

 

15,707

 

22,576

 

Total liabilities

 

875,060

 

878,659

 

Commitments and contingencies

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Common stock, par value $0.01 per share, 500,000 shares authorized; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively

 

411

 

410

 

Preferred stock, par value $0.01 per share, 50,000 shares authorized; 0 shares issued and outstanding as of April 30, 2018 and 2017

 

 

 

Additional paid-in capital

 

489,007

 

488,459

 

Retained earnings

 

89,592

 

26,621

 

Accumulated other comprehensive income (loss)

 

441

 

(884

)

Total stockholders’ equity

 

579,451

 

514,606

 

Total liabilities and stockholders’ equity

 

$

1,454,511

 

$

1,393,265

 

 

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GMS Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

Year Ended April 30, 2018 and 2017

(in thousands)

 

 

 

Year Ended April 30,

 

 

 

2018

 

2017

 

Cash flows from operating activities:

 

 

 

 

 

Net income

 

$

62,971

 

$

48,886

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

65,530

 

69,240

 

Write-off and amortization of debt discount and debt issuance costs

 

2,851

 

9,793

 

Provision for losses on accounts and notes receivable

 

(622

)

(122

)

Provision for obsolescence of inventory

 

106

 

425

 

Increase (decrease) in fair value of contingent consideration

 

195

 

(1,484

)

Equity-based compensation

 

5,745

 

3,142

 

Gain on sale and disposal of assets

 

(509

)

(336

)

Change in fair value of financial instruments

 

6,125

 

 

Changes in assets and liabilities net of effects of acquisitions:

 

 

 

 

 

Trade accounts and notes receivable

 

(11,752

)

(20,400

)

Inventories

 

(34,774

)

(18,390

)

Prepaid expenses and other assets

 

(4,441

)

(412

)

Accounts payable

 

11,365

 

(3,763

)

Accrued compensation and employee benefits

 

(236

)

4,440

 

Other accrued expenses and current liabilities

 

7,389

 

626

 

Deferred income taxes

 

(16,224

)

(20,114

)

Liabilities to noncontrolling interest holders

 

(3,704

)

1,133

 

Income tax receivable / payable

 

(1,399

)

(5,956

)

Cash provided by operating activities

 

88,616

 

66,708

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property and equipment

 

(23,741

)

(11,083

)

Proceeds from sale of assets

 

2,865

 

3,995

 

Acquisition of businesses, net of cash acquired

 

(28,333

)

(150,428

)

Cash used in investing activities

 

(49,209

)

(157,516

)

Cash flows from financing activities:

 

 

 

 

 

Repayments on the revolving credit facility

 

(617,230

)

(1,011,925

)

Borrowings from the revolving credit facility

 

513,878

 

1,013,365

 

Payments of principal on long-term debt

 

(5,776

)

(4,584

)

Payments of principal on capital lease obligations

 

(6,132

)

(5,208

)

Proceeds from issuance of common stock in initial public offering, net of underwriting discounts

 

 

156,941

 

Repayment of term loan

 

 

(160,000

)

Borrowings from term loan amendment

 

577,616

 

481,225

 

Repayment of term loan amendment

 

(477,616

)

(381,225

)

Debt issuance costs

 

(636

)

(2,637

)

Stock repurchases

 

 

 

Payments for taxes related to net share settlement of equity awards

 

(1,441

)

 

Proceeds from exercises of stock options

 

477

 

345

 

Other financing activities

 

(671

)

 

Cash (used in) provided by financing activities

 

(17,531

)

86,297

 

Increase (decrease) in cash and cash equivalents

 

21,876

 

(4,511

)

Cash and cash equivalents, beginning of year

 

14,561

 

19,072

 

Cash and cash equivalents, end of year

 

$

36,437

 

$

14,561

 

Supplemental cash flow disclosures:

 

 

 

 

 

Cash paid for income taxes

 

$

38,954

 

$

49,163

 

Cash paid for interest

 

28,613

 

26,443

 

Supplemental schedule of noncash activities:

 

 

 

 

 

Assets acquired under capital lease

 

$

9,086

 

$

9,410

 

Issuance of installment notes associated with equity-based compensation liability awards

 

12,433

 

5,352

 

Increase in other liabilities due to transition guidance

 

 

 

(Decrease) increase in insurance claims payable and insurance recoverable

 

(2,430

)

1,876

 

 

7



 

GMS Inc.

Net Sales by Product Group (Unaudited)

Three Months Ended April 30, 2018 and 2017 and Year Ended April 30, 2018 and 2017

(dollars in thousands)

 

 

 

Three Months Ended 

 

Year Ended 

 

 

 

April 30, 

 

% of

 

April 30, 

 

% of

 

April 30, 

 

% of

 

April 30, 

 

% of

 

 

 

2018

 

Total

 

2017

 

Total

 

2018

 

Total

 

2017

 

Total

 

 

 

(dollars in thousands)

 

Wallboard

 

$

279,984

 

44.0

%

$

282,150

 

45.9

%

$

1,109,552

 

44.2

%

$

1,058,400

 

45.7

%

Ceilings

 

95,644

 

15.0

%

87,489

 

14.2

%

387,360

 

15.4

%

341,007

 

14.7

%

Steel framing

 

107,032

 

16.8

%

100,220

 

16.3

%

411,630

 

16.4

%

374,151

 

16.1

%

Other products

 

153,140

 

24.1

%

145,118

 

23.6

%

602,927

 

24.0

%

545,588

 

23.5

%

Total net sales

 

$

635,800

 

 

 

$

614,977

 

 

 

$

2,511,469

 

 

 

$

2,319,146

 

 

 

 

8



 

GMS Inc.

Reconciliation of Net Income to Adjusted EBITDA (Unaudited)

Three Months Ended April 30, 2018 and 2017 and Year Ended April 30, 2018 and 2017

(in thousands)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

April 30, 

 

April 30, 

 

 

 

2018

 

2017

 

2018

 

2017

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

9,919

 

$

14,272

 

$

62,971

 

$

48,886

 

Interest expense

 

8,107

 

7,198

 

31,395

 

29,360

 

Write-off of debt discount and deferred financing fees

 

 

 

74

 

7,103

 

Interest income

 

(84

)

(51

)

(177

)

(152

)

Provision for income taxes

 

5,328

 

10,422

 

20,883

 

22,654

 

Depreciation expense

 

6,054

 

6,170

 

24,075

 

25,565

 

Amortization expense

 

9,928

 

11,591

 

41,455

 

43,675

 

EBITDA

 

$

39,252

 

$

49,602

 

$

180,676

 

$

177,091

 

Stock appreciation expense (a)

 

455

 

882

 

2,318

 

148

 

Redeemable noncontrolling interests(b)

 

498

 

457

 

1,868

 

3,536

 

Equity-based compensation(c)

 

418

 

553

 

1,695

 

2,534

 

Severance and other permitted costs(d)

 

256

 

(472

)

581

 

(157

)

Transaction costs (acquisitions and other)(e)(f)

 

3,049

 

(798

)

3,370

 

2,249

 

Loss (gain) on disposal of assets

 

139

 

(94

)

(509

)

(338

)

Management fee to related party(g)

 

 

 

 

188

 

Effects of fair value adjustments to inventory(h)

 

48

 

170

 

324

 

946

 

Change in fair value of financial instruments(i)

 

5,415

 

141

 

6,125

 

382

 

Secondary public offering costs(j)

 

 

1,385

 

1,525

 

1,385

 

Debt transaction costs(k)

 

527

 

265

 

1,285

 

265

 

EBITDA add-backs

 

10,805

 

2,489

 

18,582

 

11,138

 

Adjusted EBITDA

 

$

50,057

 

$

52,091

 

$

199,258

 

$

188,229

 

Adjusted EBITDA margin

 

7.9

%

8.5

%

7.9

%

8.1

%

 


(a)

 

Represents non-cash compensation expenses related to stock appreciation rights agreements.

 

 

 

(b)

 

Represents non-cash compensation expense related to changes in the redemption values of noncontrolling interests.

 

 

 

(c)

 

Represents non-cash equity-based compensation expense related to the issuance of share-based awards.

 

 

 

(d)

 

Represents severance expenses and other costs permitted in calculations under the ABL Facility and the First Lien Facility.

 

 

 

(e)

 

Represents one-time costs related to our IPO and acquisitions paid to third party advisors.

 

 

 

(f)

 

Includes $1.186 million in other income recorded in the fourth quarter of fiscal 2017.

 

 

 

(g)

 

Represents management fees paid by us to AEA. Following our IPO, AEA no longer receives management fees from us.

 

 

 

(h)

 

Represents the non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value.

 

 

 

(i)

 

Represents the mark-to-market adjustments for derivative financial instruments, including $5.1 million in pre-tax mark-to-market currency adjustments during the fourth quarter of fiscal 2018.

 

 

 

(j)

 

Represents one-time costs related to our secondary offering paid to third party advisors.

 

 

 

(k)

 

Represents expenses paid to third party advisors related to debt refinancing activities.

 

9



 

GMS Inc.

Reconciliation of Income Before Taxes to Adjusted Net Income (Unaudited)

Three Months Ended April 30, 2018 and 2017 and Year Ended April 30, 2018 and 2017

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

April 30, 

 

April 30, 

 

 

 

2018

 

2017

 

2018

 

2017

 

Income before taxes

 

$

15,247

 

$

24,694

 

$

83,854

 

$

71,540

 

EBITDA add-backs

 

10,805

 

2,489

 

18,582

 

11,138

 

Write-off of debt discount and deferred financing fees

 

 

 

74

 

7,103

 

Purchase accounting depreciation and amortization (1)

 

5,233

 

7,254

 

21,271

 

30,518

 

Adjusted pre-tax income

 

31,285

 

34,437

 

123,781

 

120,299

 

Adjusted income tax expense (2)

 

7,784

 

8,568

 

39,077

 

37,978

 

Adjusted net income

 

$

23,501

 

$

25,869

 

$

84,704

 

$

82,321

 

Effective tax rate (2)

 

24.9

%

24.9

%

31.6

%

31.6

%

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

41,048

 

40,956

 

41,015

 

40,260

 

Diluted

 

42,151

 

41,759

 

42,163

 

41,070

 

Adjusted net income per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.57

 

$

0.63

 

$

2.07

 

$

2.04

 

Diluted

 

$

0.56

 

$

0.62

 

$

2.01

 

$

2.00

 

 


(1)         Depreciation and amortization from the increase in value of certain long-term assets associated with the April 1, 2014 acquisition of the predecessor company. The full year FY19 projected amount related to GMS is $15.6 million. The full year FY19 projected amount related to the Titan acquisition is expected to be between $46.0 and $50.0 million.

(2)         Normalized cash tax rate determined based on our estimated taxes for fiscal 2018 under the Tax Cuts and Jobs Act of 2017, excluding the impact of purchase accounting and certain other deferred tax accounts.

 

Contact Information:

 

Investor Relations:

ir@gms.com

678-353-2883

 

Media Relations:

marketing@gms.com

770-723-3378

 

10


(Back To Top)

Section 3: EX-99.2 (EX-99.2)

Exhibit 99.2

 

GMS Quarterly Review Fiscal Q4 2018

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Safe Harbor and Basis of Presentation Forward-Looking Statement Safe Harbor - This presentation includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by us to be reasonable, are inherently uncertain. Examples of forward-looking statements include those related to net sales, gross profit, gross margins, capital expenditures and market share growth, as well as non-GAAP financial measures such as Adjusted EBITDA, the ratio of debt-to-Adjusted EBITDA, adjusted net income and base business sales, including any management expectations or outlook for fiscal 2019 and beyond. In addition, statements regarding potential acquisitions and future greenfield locations and statements regarding the impact of the recent tax legislation, fiscal 2018 and 2019 effective tax rates and the expected use of tax savings are forward-looking statements, as well as statements regarding the markets in which the Company or Titan operates, product expansion opportunities and the potential for growth in the commercial, residential and repair and remodeling, or R&R, markets. In addition, statements relating to the Titan acquisition, including the combination of best practices, statements regarding expected synergies, cost savings, margin improvement, expected accretion and its expected contribution to the Company’s Adjusted EBITDA for the eleven months ending April 30, 2019, are forward-looking statements. Forward-looking statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of our control, that may cause our business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the prices, margin, supply, and/or demand for products which we distribute; general economic and business conditions in the United States and Canada; the activities of competitors; changes in significant operating expenses; changes in the availability of capital and interest rates; adverse weather patterns or conditions; acts of cyber intrusion; variations in the performance of the financial markets, including the credit markets; the possibility that the expected synergies and cost savings and financial impacts from the Titan acquisition will not be realized, or will not be realized within the expected time period; the risk that the GMS and Titan businesses will not be integrated successfully; disruption from the transaction making it more difficult to maintain business and operational relationships and to accomplish other GMS objectives; the risk of customer attrition; and other factors described in the "Risk Factors" section in our Annual Report on Form 10-K for the fiscal year ended April 30, 2018, and in our other periodic reports filed with the SEC. In addition, the statements in this presentation are made as of June 28, 2018. We undertake no obligation to update any of the forward looking statements made herein, whether as a result of new information, future events, changes in expectation or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to June 28, 2018. Use of Non-GAAP and Adjusted Financial Information - To supplement GAAP financial information, we use adjusted measures of operating results which are non-GAAP measures. This non-GAAP adjusted financial information is provided as additional information for investors. These adjusted results exclude certain costs, expenses, gains and losses, and we believe their exclusion can enhance an overall understanding of our past financial performance and also our prospects for the future. These adjustments to our GAAP results are made with the intent of providing both management and investors a more complete understanding of our operating performance by excluding non-recurring, infrequent or other non-cash charges that are not believed to be material to the ongoing performance of our business. The presentation of this additional information is not meant to be considered in isolation or as a substitute for GAAP measures of net income, diluted earnings per share or net cash provided by (used in) operating activities prepared in accordance with generally accepted accounting principles in the United States. Financial information related to Titan’s performance in periods prior to the acquisition included in this release were provided by Titan and are unaudited. 2

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Fiscal Q4 and Fiscal 2018 Highlights 3 We achieved solid fourth quarter results, capping off a successful fiscal 2018 Net sales increased 3.4% to a record $635.8 million, base business net sales up 2.0% Wallboard price increased 2.4% Net income of $9.9 million, or EPS of $0.24 per diluted share Adjusted EBITDA declined 3.9% to $50.1 million Opened greenfield location in Hartford, CT on February 1, 2018 On April 2, 2018, acquired the GSD distribution operations of Grabber Construction Products, Inc. in Concord, CA and the GSD assets of CMH Distributing, Inc. in Kearney, NE Initiated a strategic cost reduction plan in May of this year to improve our operational efficiency We expect the actions that we have taken to generate annualized cost savings of approximately $20.0 million dollars Fiscal 2018 Highlights Closed June 1, 2018, establishing 30 location footprint in Canada and expanding the leading North American distributor of wallboard and ceilings with over 240 locations across 42 states and 5 provinces Pro forma LTM 4/30/18 net sales of ~$3 billion and Adjusted EBITDA of ~$302 million (1) Expected to be immediately accretive to Adjusted EPS and Adjusted EBITDA margin Strategic Cost Reduction Plan Titan Acquisition Update Fiscal Q4 2018 Highlights Sales increased 8.3% to a record $2.5 billion, base business net sales up 4.5% Net income of $63.0 million, or EPS of $1.49 per diluted share, grew $14.1 million or 28.8% Adjusted EBITDA increased 5.9% to a record $199.3 million Executed 5 acquisitions and opened 3 new greenfields For illustrative purpose only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation.

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Titan Acquisition Creates Well-Balanced Platform Built for Growth in the United States and Canada Sales by Product (LTM) End Market Mix (LTM) Combined (2) Revenue (LTM) $2.5 billion $0.5 billion $3.0 billion Distribution Branches 214 30 244 Number of Employees 4,600 1,200 5,800 Based on financial information provided by Titan, calculated using 12/31/17 audited financial statements rolled forward for January through April 2018’s unaudited results. For illustrative purpose only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation. (US$ in millions) 4 (1) (LTM as of April 30, 2018) Wallboard ~44% Steel ~ 16% Ceilings ~ 15% Insulation ~ 4% Other ~20% Wallboard , 43% Steel , 15% Ceilings , 13% Insulation , 7% Other , 23% Residential ~40% Commercial ~60% Residential ~45% Commercial ~55% Residential 61% Commercial / Industrial 27% Two - Step Distribution 12% Wallboard 32% Steel 6% Ceilings , 3% Insulation 19% Other 40%

 


Fiscal 2018 Pro Forma Summary 5 ($ in millions, April FYE) Pro Forma Adjusted EBITDA (1) (3) Pro Forma Net Sales & Gross Margin (3) ($ in millions, April FYE) % Margin (1) 3.3% 5.0% 6.4% 6.7% 7.4% 8.1% 7.9% 10.1% +600bps, excl. $23mm lease impact FY2015, FY2016, FY2017 and FY2018 PF Adj. EBITDA includes approximately $8.1 million, $12.1 million, $9.5 million and $1.3 million, respectively, from entities acquired in FY2015, FY2016, FY2017 and FY2018 respectively, for the period prior to their respective dates of acquisition. However, Adj. EBITDA margin excludes the impact of the entities acquired for the period prior to their respective dates of acquisition. For a reconciliation of PF Adj. EBITDA to Net Income (loss), the most directly comparable GAAP measure, see Appendix page 15. Based on financial information provided by Titan, calculated using 12/31/17 audited financial statements rolled forward for January through April 2018’s unaudited results. For illustrative purpose only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation. +61% since May 2016 IPO $106 $138 $188 $199 $199 $8 $12 $10 $1 $103 $32 $57 $87 $114 $150 $198 $201 $302 FY-12 FY-13 FY-14 FY-15 FY-16 FY-17 FY-18 FY-18 PF $991 $1,162 $1,353 $1,570 $1,858 $2,319 $2,511 $2,989 FY-12 FY-13 FY-14 FY-15 FY-16 FY-17 FY-18 FY-18 PF $ in millions FY18 GMS Actual Lease Impact FY18 GMS PF Titan + Synergies (2) FY18 GMS Combined PF (3) Net Sales $2,511.5 $2,511.5 $478.4 $2,989.9 Adjusted EBITDA (1) $200.5 $23.0 $223.5 $78.4 $301.9 Adjusted EBITDA Margin (1) 7.9% 8.9% 10.1% Improvement vs. Actual +100bps +220bps

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Fiscal Q4 2018 Performance Gross Profit ($ mm) Fiscal Q4 2018 Gross Profit & Margin Adj. EBITDA(2) ($ mm) Fiscal Q4 2018 Adjusted EBITDA (2) When calculating our “base business” results, we exclude any branches that were acquired in the current fiscal year, prior fiscal year and three months prior to the start of the prior fiscal year. For a reconciliation of Adj. EBITDA to Net Income, the most directly comparable GAAP metric, see Appendix. Margin (2): 8.5% 7.9% 2.0% organic sales growth, led by steel framing (5.5%), ceilings (+5.1%) and other products (+4.6%) Gross margin declined 30 bps from prior year Adjusted EBITDA declined 3.9% to $50.1 million reflecting lower gross margin on low single digit sales growth Adjusted EBITDA margin declined 60 bps from prior year, impacted by the 30 basis point decrease in gross margin and 30 basis point increase in SG&A expense, driven primarily by higher logistics costs Commentary (3.9%) YOY Fiscal Q4 2018 Performance 6 $52.1 $50.1 - 10.0 20.0 30.0 40.0 50.0 Fiscal Q4 2017 Fiscal Q4 2018 ($ in millions) Fiscal Q4 YOY Base FY17 FY18 Growth Business (1) WB Volume (MSF) 906 878 (3.1%) (3.6%) WB Price ($ / MSF) 311 $ 319 $ 2.4% Net Sales Wallboard 282.2 $ 280.0 $ (0.8%) (1.4%) Ceilings 87.5 95.6 9.3% 5.1% Steel Framing 100.2 107.0 6.8% 5.5% Other Products 145.1 153.2 5.6% 4.6% Total Net Sales 615.0 $ 635.8 $ 3.4% 2.0%

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Fiscal 2018 Performance Gross Profit ($ mm) Fiscal 2018 Gross Profit & Margin Adj. EBITDA(2) ($ mm) Fiscal 2018 Adjusted EBITDA (2) When calculating our “base business” results, we exclude any branches that were acquired in the current fiscal year, prior fiscal year and three months prior to the start of the prior fiscal year. For a reconciliation of Adj. EBITDA to Net Income, the most directly comparable GAAP metric, see Appendix. Margin (2): 8.1% 7.9% 4.5% organic sales growth, led by ceilings (+9.0%), other products (+7.0%) and steel framing (+5.4%) Gross margin declined approximately 10 bps from prior year Adjusted EBITDA increased 5.9% to a record $199.3 million, driven by strong sales growth Adjusted EBITDA margin declined 20 bps from prior year, primarily the result of a slight decrease in gross margin and a slight increase in SG&A Commentary +5.9% YOY Fiscal 2018 Performance 7 $188.2 $199.3 - 50.0 100.0 150.0 200.0 Fiscal 2017 Fiscal 2018 ($ in millions) Fiscal YOY Base FY17 FY18 Growth Business (1) WB Volume (MSF) 3,457 3,548 2.6% (0.5%) WB Price ($ / MSF) 306 $ 313 $ 2.2% Net Sales Wallboard 1,058.4 $ 1,109.5 $ 4.8% 1.5% Ceilings 341.0 387.4 13.6% 9.0% Steel Framing 374.2 411.6 10.0% 5.4% Other Products 545.6 603.0 10.5% 7.0% Total Net Sales 2,319.1 2,511.5 8.3% 4.5%

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Fiscal 2018 Results – Operating Expenses 8 Full Year SG&A & SG&A % of Sales FY2018 vs. FY2017 SG&A Bridge Organic Adjusted SG&A expenses increased ~3.6% in Q4 and ~4.7% in fiscal 2018, primarily the result of higher logistics costs Significant cost reductions implemented since May 2018 G&A headcount reductions effective 6/26/18 Other G&A (travel & entertainment, professional fees, etc.) Total annualized Additional cost reduction initiatives underway, while continuing to invest in opportunities to increase sales and expand margin Commentary Adjusted SG&A excludes any branches that were acquired in the current fiscal year, prior fiscal year and three months prior to the start of the prior fiscal year, as well as Adjusted EBITDA add backs. For a reconciliation of Adjusted SG&A to Reported SG&A, see Appendix page 18. Adjusted SG&A PF includes the impact of the $20.0 million cost reduction plan. (2) 25.2% 25.2% 24.9% 25.0% 24.1% Organic SG&A ($ in millions) ($ in millions) (1) $585.1 $633.9 $541.7 $567.1 $547.1 $480 $500 $520 $540 $560 $580 $600 $620 $640 $660 FY2017 FY2018 GAAP SG&A Adjusted SG&A Adjusted SG&A PF FY18 Q4 FY18 Payroll & Payroll Related 1.5 $ 13.8 $ Equipment Leases - Logistics 0.8 4.5 Fuel - Logistics 1.1 2.6 All Other 1.5 4.5 Total Adjusted SG&A (1) 4.9 $ 25.4 $ EBITDA Add-Backs 1.3 2.3 SG&A - Acquisitions 2.5 21.1 Total GAAP SG&A 8.7 $ 48.8 $ $16.6 mm 3.4 mm $20.0 mm

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Capital Structure Pre and Post Titan Transaction Pre Titan transaction capital structure as of 4/30/18: Leverage of 2.8x Net Debt / LTM Pro Forma Adj. EBITDA, down from 2.9x Net Debt / LTM Pro Forma Adj. EBITDA as of 4/30/17 Post Titan transaction capital structure as of 4/30/18: Pro Forma leverage of 4.1x Net Debt / LTM Pro Forma Adj. EBITDA Compares favorably to 6.0x Net Debt / LTM Pro Forma Adj. EBITDA as of 4/30/14 and 4.3x pre-IPO Moody’s and Standard & Poor’s maintained current rating of B1/BB- FY18 PF capital structure reflects the conversion of existing GMS equipment operating leases to capital leases effective May 1, 2018 and the expected increase to PP&E and debt accounts by ~$75 million. Commentary Leverage Summary Net Debt / PF Adjusted EBITDA FY18 PF capital structure reflects the conversion of existing GMS equipment operating leases to capital leases effective May 1, 2018 and the expected increase to PP&E and debt accounts by ~$75 million. FY18 PF Adjusted EBITDA reflects the favorable impact to Adjusted EBITDA of ~$23 million related to the conversion of existing equipment operating leases to capital leases and $78 million of PF Adjusted EBITDA, including synergies, from the Titan acquisition. For illustrative purposes only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation. 9 (3) (3) 4.3x 2.9x 2.8x 4.1x FY16 FY17 FY18 FY18 PF (US$ in millions) FY16 FY17 FY18 FY18 PF Cash and cash equivalents $19 $15 $36 $12 Asset-Based Revolver 102 103 - 143 Term Debt 542 478 573 998 Assumed Liability for Prior Ownership - - - 15 Capital Lease and Other (1) 14 14 23 99 Total Debt $658 $595 $596 $1,255 PF Adj. EBITDA (2) $150 $198 $201 $302 Total Debt / PF Adj. EBITDA 4.4x 3.0x 3.0x 4.2x Net Debt / PF Adj. EBITDA 4.3x 2.9x 2.8x 4.1x

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Leading Specialty Distributor Poised for Continued Growth 10 Market Leader with Significant Scale Advantages – #1 North American Distributor of Wallboard and Ceilings Differentiated Service Model Drives Market Leadership Multiple Levers to Drive Market Leading Growth – Market Share, Greenfields, M&A, Operating Leverage Capitalizing on growth in Large, Diverse End Markets Entrepreneurial Culture with Dedicated Employees and Experienced Leadership Driving Superior Execution National Scale Combined With Local Expertise Market Leader with Scale Advantages

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Appendix

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Summary Quarterly Financials Note: Fiscal year end April 30. 12 (In millions, except per share data) 1Q17 2Q17 3Q17 4Q17 FY17 1Q18 2Q18 3Q18 4Q18 FY18 (Unaudited) Wallboard Volume (MSF) 818 891 842 906 3,457 914 929 826 878 3,548 Wallboard Price ($ / '000 Sq. Ft.) 307 $ 303 $ 303 $ 311 $ 306 $ 311 $ 311 $ 312 $ 319 $ 313 $ Wallboard 251 $ 270 $ 255 $ 282 $ 1,058 $ 285 $ 288 $ 256 $ 280 $ 1,110 $ Ceilings 86 85 82 87 341 100 102 90 96 387 Steel framing 84 96 94 100 374 105 103 97 107 412 Other products 128 140 132 145 546 153 155 142 153 603 Net sales 550 592 563 615 2,319 642 648 586 636 2,511 Cost of sales 371 399 377 414 1,561 437 436 390 430 1,693 Gross profit 179 193 186 201 759 205 212 195 206 819 Gross margin 32.5% 32.6% 33.0% 32.7% 32.7% 31.9% 32.8% 33.4% 32.4% 32.6% Operating expenses: Selling, general and administrative expenses 135 150 147 153 585 156 160 156 162 634 Depreciation and amortization 16 17 18 18 69 16 17 16 16 66 Total operating expenses 151 167 166 171 654 172 177 173 178 699 Operating income 28 26 20 30 104 33 36 23 28 119 Other (expense) income: Interest expense (8) (7) (7) (7) (29) (8) (8) (8) (8) (31) Change in fair value of financial instruments (0) (0) (0) (0) (0) (0) (0) (0) (5) (6) Write-off of discount and deferred financing costs (5) (1) (0) - (7) (0) - - - (0) Other income, net 1 1 1 2 4 0 1 1 1 2 Total other expense, net (12) (8) (7) (6) (33) (7) (8) (7) (13) (35) Income from continuing operations, before tax 15 18 14 25 72 25 28 15 15 84 Income tax expense (benefit) 6 1 5 10 23 10 10 (4) 5 21 Net income 9 $ 17 $ 8 $ 14 $ 49 $ 15 $ 18 $ 20 $ 10 63 Weighted average shares outstanding: Basic 38,201 40,943 40,943 40,956 40,260 40,971 41,006 41,036 41,048 41,015 Diluted 38,602 41,320 41,578 41,759 41,070 42,128 42,146 42,228 42,151 42,163 Net income per share: Basic 0.24 $ 0.42 $ 0.20 $ 0.35 $ 1.21 $ 0.37 $ 0.44 $ 0.48 $ 0.24 $ 1.54 $ Diluted 0.24 $ 0.42 $ 0.20 $ 0.34 $ 1.19 $ 0.36 $ 0.43 $ 0.47 $ 0.24 $ 1.49 $

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Quarterly Net Sales Note: Fiscal year end April 30. When calculating our “base business” results, we exclude any branches that were acquired in the current fiscal year, prior fiscal year and three months prior to the start of the prior fiscal year. FY17 quarterly sales from acquisitions have been updated in accordance with our presentation of base business for the FY18 vs. FY17 comparative period. Includes greenfields, which we consider extensions of “base business.” FY17 acquired branches have been updated to reflect the number of acquired branches that are included within the sales from acquisitions FY19 Business Days 1Q19 64 days 2Q19 65 days 3Q19 62 days 4Q19 63 days FY19 254 days 13 ($ in millions) 1Q17 2Q17 3Q17 4Q17 FY17 1Q18 2Q18 3Q18 4Q18 FY18 (Unaudited) Base Business (1) (2) 544 $ 561 $ 511 $ 558 $ 2,173 $ 586 $ 590 $ 526 $ 569 $ 2,272 $ Acquisitions (2) 6 31 52 57 146 56 58 59 66 240 Total Net Sales 550 $ 592 $ 563 $ 615 $ 2,319 $ 642 $ 648 $ 586 $ 636 $ 2,512 $ Business Days 63 65 62 63 253 64 65 62 63 254 Net Sales by Business Day 8.7 $ 9.1 $ 9.1 $ 9.8 $ 9.2 $ 10.0 $ 10.0 $ 9.4 $ 10.1 $ 9.9 $ Base Business Branches (3) (4) 185 188 188 189 189 190 190 191 191 191 Acquired Branches (4) 5 15 16 16 16 16 20 21 23 23 Total Branches 190 203 204 205 205 206 210 212 214 214

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Quarterly Net Income to Adjusted EBITDA Adjusted EBITDA Reconciliation Commentary Represents non-cash compensation expenses related to stock appreciation rights agreements Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests Represents non-cash equity-based compensation expense related to the issuance of share-based awards Represents severance and other costs permitted in calculations under the ABL Facility and the First Lien Facility Represents one-time costs related to our initial public offering and acquisitions paid to third party advisors, including fees to financial advisors, accountants, attorneys and other professionals as well as costs related to the retirement of corporate stock appreciation rights. Includes $1.186 million in other income recorded in the fourth quarter of fiscal 2017 Represents management fees paid to AEA, which were discontinued after the IPO. 1Q17 includes fees paid for the month of May Non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value Mark-to-market adjustments for certain financial instruments Represents costs paid to third party advisors related to the secondary public offerings of our common stock Represents costs paid to third party advisors related to debt refinancing activities 14 ( $ in 000s) 1Q17 2Q17 3Q17 4Q17 FY17 1Q18 2Q18 3Q18 4Q18 FY18 (Unaudited) Net Income 9,163 $ 17,224 $ 8,227 $ 14,272 $ 48,886 $ 15,343 $ 18,023 $ 19,686 $ 9,919 $ 62,971 $ Add: Interest Expense 7,577 7,154 7,431 7,198 29,360 7,500 7,917 7,871 8,107 31,395 Add: Write off of debt discount and deferred financing fees 5,426 1,466 211 - 7,103 74 - - - 74 Less: Interest Income (43) (35) (23) (51) (152) (23) (26) (44) (84) (177) Add: Income Tax Expense (Benefit) 6,159 710 5,363 10,422 22,654 10,060 9,983 (4,488) 5,328 20,883 Add: Depreciation Expense 6,382 6,548 6,465 6,170 25,565 5,990 6,023 6,009 6,054 24,075 Add: Amortization Expense 9,413 10,820 11,851 11,591 43,675 10,355 10,690 10,481 9,928 41,455 EBITDA 44,077 $ 43,887 $ 39,525 $ 49,602 $ 177,091 $ 49,299 $ 52,610 $ 39,515 $ 39,252 $ 180,676 $ Adjustments Stock appreciation rights expense (income) (A) (92) (144) (498) 882 148 590 642 631 455 2,318 Redeemable noncontrolling interests (B) 292 2,531 256 457 3,536 866 164 340 498 1,868 Equity-based compensation (C) 673 686 622 553 2,534 473 375 429 418 1,695 Severance and other permitted costs (D) 140 118 57 (472) (157) 205 113 7 256 581 Transaction costs (acquisition and other) (E) ,(F) 654 1,827 305 (798) 1,988 159 88 75 3,049 3,370 Loss (gain) on disposal of assets (198) 68 (114) (94) (338) (390) (207) (51) 139 (509) AEA management fee (G) 188 - - - 188 - - - - - Effects of fair value adjustments to inventory (H) 164 457 155 170 946 - 187 89 48 324 Change in fair value of financial instruments (I) 43 89 109 141 382 196 238 276 5,415 6,125 Secondary public offerings (J) - - - 1,385 1,385 631 - 894 - 1,525 Debt transaction costs (K) - - 261 265 526 723 35 - 527 1,285 Total Add-Backs 1,864 $ 5,632 $ 1,153 $ 2,489 $ 11,138 $ 3,453 $ 1,635 $ 2,690 $ 10,805 $ 18,582 $ Adjusted EBITDA 45,941 $ 49,519 $ 40,678 $ 52,091 $ 188,229 $ 52,752 $ 54,245 $ 42,205 $ 50,057 $ 199,258 $

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LTM Net Income to Pro Forma Adjusted EBITDA Pro Forma Adjusted EBITDA Reconciliation Commentary 15 Represents non-cash compensation expenses related to stock appreciation rights agreements Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests Represents non-cash equity-based compensation expense related to the issuance of share-based awards Represents non-recurring expenses related specifically to the AEA acquisition of GMS Represents severance and other costs permitted in calculations under the ABL Facility and the First Lien Facility Represents one-time costs related to our initial public offering and acquisitions (including the Acquisition) paid to third party advisors, including fees to financial advisors, accountants, attorneys and other professionals as well as costs related to the retirement of corporate stock appreciation rights. Also included are one-time bonuses paid to certain employees in connection with the Acquisition Represents management fees paid to AEA, which were discontinued after the IPO Non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value Mark-to-market adjustments for certain financial instruments Represents costs paid to third party advisors related to the secondary public offerings of our common stock Represents costs paid to third party advisors related to debt refinancing activities Pro forma impact of earnings from acquisitions from the beginning of the LTM period to the date of acquisition ( $ in 000s) 2018 2017 2016 2015 (Unaudited) Net Income (Loss) 62,971 $ 48,886 $ $ 12,564 $ (11,697) Add: Interest Expense 31,395 29,360 37,418 36,396 Add: Write off of debt discount and deferred financing fees 74 7,103 - - Less: Interest Income (177) (152) (928) (1,010) Add: Income Tax Expense 20,883 22,654 12,584 (6,626) Add: Depreciation Expense 24,075 25,565 26,667 32,208 Add: Amortization Expense 41,455 43,675 37,548 31,957 EBITDA 180,676 $ 177,091 $ $ 125,853 $ 81,228 Adjustments Stock appreciation rights expense (A) 2,318 148 1,988 2,268 Redeemable noncontrolling interests (B) 1,868 3,536 880 1,859 Equity-based compensation (C) 1,695 2,534 2,699 6,455 AEA transaction related costs (D) - - - 837 Severance and other permitted costs (E) 581 (157) 379 413 Transaction costs (acquisition and other) (F) 3,370 1,988 3,751 1,891 (Gain) loss on disposal of assets (509) (338) (645) 1,089 AEA management fee (G) - 188 2,250 2,250 Effects of fair value adjustments to inventory (H) 324 946 1,009 5,012 Change in fair value of financial instruments (I) 6,125 382 - - Secondary public offerings (J) 1,525 1,385 19 2,494 Debt transaction costs (K) 1,285 526 - - Total Add-Backs 18,582 $ 11,138 $ 12,330 $ 24,568 $ Adjusted EBITDA 199,258 $ 188,229 $ 138,183 $ 105,796 $ Contributions from acquisitions (L) 1,280 9,500 12,093 8,064 Pro Forma Adjusted EBITDA 200,538 $ 197,729 $ 150,276 $ 113,860 $

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Net Income to Adjusted EBITDA Adjusted EBITDA Reconciliation Commentary Represents compensation paid to certain executives who were majority owners prior to the AEA acquisition of GMS. Following the acquisition, these executives’ compensation agreements were amended and, going forward, GMS does not anticipate additional adjustments Represents non-cash compensation expenses related to stock appreciation rights agreements Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests Represents non-cash equity-based compensation expense related to the issuance of stock options Represents non-recurring expenses related specifically to the AEA acquisition of GMS Represents severance and other costs permitted in calculations under the ABL Facility and the First Lien Facility Represents one-time costs related to our initial public offering and acquisitions (including the Acquisition) paid to third party advisors, including fees to financial advisors, accountants, attorneys and other professionals as well as costs related to the retirement of corporate stock appreciation rights. Also included are one-time bonuses paid to certain employees in connection with the Acquisition Represents management fees paid to AEA, which were discontinued after the IPO Non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value Mark-to-market adjustments for certain financial instruments Represents costs incurred in connection with withdrawal from a multi-employer pension plan 16 FY14 is comprised of 11 month period (predecessor) and one month period (successor) ($ in 000s) (Unaudited) 2015 2014 (1) 2013 2012 Net income (loss) $ (11,697) $(219,814) $(182,627) $ (7,830) Income tax expense (benefit) (6,626) (240) 11,534 2,658 Discountinued operations, net of tax - - - (362) Interest income (1,010) (922) (798) (885) Interest expense 36,396 7,180 4,413 2,966 Change in fair value of mandatorily redeemable shares - 200,004 198,212 8,952 Depreciation expense 32,208 16,042 11,665 7,840 Amortization expense 31,957 2,556 72 732 EBITDA $ 81,228 $ 4,806 $ 42,471 $ 14,071 Adjustments Executive compensation (A) $ - $ 2,447 $ 13,420 $ 8,266 Stock appreciation rights expense (benefit) (B) 2,268 1,368 1,061 253 Redeemable noncontrolling interests (C) 1,859 3,028 2,195 407 Equity-based compensation (D) 6,455 28 82 (154) AEA transaction related costs (E) 837 67,964 230 133 Severance costs and other permitted costs (F) 413 - (30) (205) Transaction costs (acquisition and other) (G) 1,891 - - - Loss (gain) on disposal of assets 1,089 (864) (2,231) (556) AEA management fee (H) 2,250 188 - - Effects of fair value adjustments to inventory (I) 5,012 8,289 - - Interest rate swap / cap mark-to-market (J) 2,494 (192) 313 - Pension withdrawal (K) - - - 10,179 Total Add-Backs 24,568 82,256 15,040 18,323 Adjusted EBITDA $105,796 $ 87,062 $ 57,511 $ 32,394

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Quarterly Cash Flows 17 ($ in millions) (Unaudited) 1Q17 2Q17 3Q17 4Q17 FY17 1Q18 2Q18 3Q18 4Q18 FY18 Net income $ 9.2 $ 17.2 $ 8.2 $ 14.3 $ 48.9 15.3 $ 18.0 $ 19.7 $ 9.9 $ 63.0 Non-cash changes & other changes (5.0) 11.5 23.8 30.1 60.4 (2.8) 13.3 14.9 35.3 60.8 Changes in primary working capital components: Trade accounts and notes receivable (19.4) 0.0 16.1 (17.2) (20.4) (12.9) (8.9) 36.4 (26.3) (11.8) Inventories (17.1) 3.7 (12.3) 7.3 (18.4) (3.3) (4.0) (16.3) (11.2) (34.8) Accounts payable 1.7 (1.1) (0.3) (4.1) (3.8) 9.5 5.1 (20.3) 17.1 11.4 Cash provided by (used in) operating activities (30.6) 31.3 35.6 30.4 66.7 5.9 23.5 34.4 24.9 88.6 Purchases of property and equipment (2.6) (2.4) (1.9) (4.2) (11.1) (5.5) (2.9) (5.0) (10.3) (23.7) Proceeds from sale of assets 0.8 0.5 1.9 0.8 4.0 1.4 0.5 0.4 0.5 2.9 Acquisitions of businesses, net of cash acquired (26.6) (113.4) (6.0) (4.5) (150.4) (3.1) (15.3) (5.2) (4.8) (28.3) Cash (used in) provided by investing activities (28.3) (115.3) (6.0) (7.9) (157.5) (7.2) (17.7) (9.7) (14.6) (49.2) Cash provided by (used in) financing activities 49.7 90.5 (35.4) (18.5) 86.3 6.5 (5.8) (15.5) (2.8) (17.5) Increase (decrease) in cash and cash equivalents (9.2) 6.6 (5.8) 4.0 (4.5) 5.2 0.0 9.2 7.5 21.9 Balance, beginning of period 19.1 9.8 16.4 10.6 19.1 14.6 19.7 19.8 28.9 14.6 Balance, end of period $ 9.8 $ 16.4 $ 10.6 $ 14.6 $ 14.6 19.7 $ 19.8 28.9 $ 36.4 $ 36.4 Supplemental cash flow disclosures: Cash paid for income taxes $ 6.5 $ 24.3 $ 9.0 $ 9.3 $ 49.2 $ 1.8 $ 26.7 $ 6.6 $ 3.9 $ 39.0 Cash paid for interest $ 6.6 $ 6.6 $ 6.9 $ 6.4 $ 26.4 $ 6.8 $ 7.3 $ 7.1 $ 7.4 $ 28.6 Historical

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Reconciliation of SG&A to Adjusted SG&A & Organic SG&A GAAP SG&A Reconciliation Commentary Represents non-cash compensation expenses related to stock appreciation rights agreements Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests Represents non-cash equity-based compensation expense related to the issuance of stock options Represents severance and other costs permitted in calculations under the ABL Facility and the First Lien Facility Represents one-time costs related to our initial public offering and acquisitions (including the Acquisition) paid to third party advisors, including fees to financial advisors, accountants, attorneys and other professionals as well as costs related to the retirement of corporate stock appreciation rights. Represents management fees paid to AEA, which were discontinued after the IPO. 1Q17 includes fees paid for the month of May Represents costs paid to third party advisors related to the secondary public offerings of our common stock Represents costs paid to third party advisors related to debt refinancing activities Represents SG&A incurred by any branches that were acquired in the current fiscal year, prior fiscal year and three months prior to the start of the prior fiscal year 18 (Unaudited) 1Q17 2Q17 3Q17 4Q17 FY2017 1Q18 2Q18 3Q18 4Q18 FY2018 ($ in millions) SG&A - Reported 135.1 $ 149.8 $ 147.3 $ 153.0 $ 585.1 $ 156.1 $ 159.9 $ 156.3 $ 161.6 $ 633.9 $ Adjustments Stock appreciation rights expense (benefit) (A) 0.1 0.1 0.5 (0.9) (0.1) (0.6) (0.6) (0.6) (0.5) (2.3) Redeemable noncontrolling interests (B) (0.3) (2.5) (0.3) (0.5) (3.5) (0.9) (0.2) (0.3) (0.5) (1.9) Equity-based compensation (C) (0.7) (0.7) (0.6) (0.6) (2.5) (0.5) (0.4) (0.4) (0.4) (1.7) Severance and other permitted costs (D) (0.1) (0.1) (0.1) 0.5 0.2 (0.2) (0.1) (0.0) (0.3) (0.6) Transaction costs (acquisition and other) (E) (0.7) (1.8) (0.3) 0.8 (2.0) (0.2) (0.1) (0.1) (3.0) (3.4) Loss (gain) on disposal of assets 0.2 (0.1) 0.1 0.1 0.3 0.4 0.2 0.1 (0.1) 0.5 AEA management fee (F) (0.2) - - - (0.2) - - - - - Secondary Public Offering (G) - - - (1.4) (1.4) (0.6) - (0.9) - (1.5) Debt Related Costs (H) - - (0.3) (0.3) (0.5) (0.7) (0.0) - (0.5) (1.3) SG&A - Adjusted 133.4 $ 144.7 $ 146.4 $ 150.8 $ 575.3 $ 152.8 $ 158.7 $ 153.9 $ 156.3 $ 621.7 $ SG&A - Acquistions (I) 1.2 $ 6.1 $ 12.5 $ 13.8 $ 33.5 $ 12.1 $ 13.7 $ 14.5 $ 14.4 $ 54.6 $ Organic Adjusted SG&A 132.2 $ 138.6 $ 133.9 $ 137.0 $ 541.7 $ 140.7 $ 145.0 $ 139.5 $ 141.9 $ 567.1 $

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LTM Net Income to Pro Forma Adjusted EBITDA Including WSB Titan Pro Forma Adjusted EBITDA Reconciliation Commentary 19 Note: Titan figures converted at CAD/USD average monthly exchange rate of 0.7816. For illustrative purpose only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation. Represents non-cash compensation expenses related to stock appreciation rights agreements Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests Represents non-cash equity-based compensation expense related to the issuance of share-based awards Represents severance and other costs permitted in calculations under the ABL Facility and the First Lien Facility Represents one-time costs related to our initial public offering and acquisitions (including the Acquisition) paid to third party advisors, including fees to financial advisors, accountants, attorneys and other professionals as well as costs related to the retirement of corporate stock appreciation rights. Also included are one-time bonuses paid to certain employees in connection with the Acquisition Non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value Mark-to-market adjustments for certain financial instruments Represents costs paid to third party advisors related to the secondary public offerings of our common stock Represents costs paid to third party advisors related to debt refinancing activities Pro forma impact of earnings from acquisitions from the beginning of the LTM period to the date of acquisition Represents the favorable impact to Adjusted EBITDA related to the conversion of existing GMS equipment operating leases to capital leases Represents Titan’s Adjusted EBITDA for the LTM 4/30/18 period. Based on 12/31/17 audited financial statements rolled forward April 2018’s unaudited results Represents the projected run-rate annual pre-tax procurement synergies associated with the combined company’s enhanced scale ( $ in 000s) LTM April 30, 2018 (Unaudited) Net Income (Loss) 62,971 $ Add: Interest Expense 31,395 Add: Write off of debt discount and deferred financing fees 74 Less: Interest Income (177) Add: Income Tax Expense 20,883 Add: Depreciation Expense 24,076 Add: Amortization Expense 41,454 EBITDA 180,676 $ Adjustments Stock appreciation rights expense (A) 2,318 Redeemable noncontrolling interests (B) 1,868 Equity-based compensation (C) 1,695 Severance and other permitted costs (D) 581 Transaction costs (acquisition and other) (E) 3,370 (Gain) loss on disposal of assets (509) Effects of fair value adjustments to inventory (F) 324 Change in fair value of financial instruments (G) 6,125 Secondary public offerings (H) 1,525 Debt transaction costs (I) 1,285 Total Add-Backs 18,582 $ Adjusted EBITDA 199,258 $ Contributions from acquisitions (J) 1,280 GMS Pro Forma Adjusted EBITDA (as reported) 200,538 $ Conversion of GMS operating leases (K) 23,000 Titan Adjusted EBITDA (L) 68,400 Cost Synergies (M) 10,000 Combined Pro Forma Adjusted EBITDA (1) 301,938 $

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20 Assuming the effects of tax reform and the acquisition of Titan were effective 5/1/2017, the table below reflects the estimated impact of both on Adjusted Net Income: Commentary As reported in GMS's June 28, 2018 earnings release statement and WSB Titan 12/31/17 audited results adjusted for January through April 2018 unaudited results. Titan EBITDA Add-Backs are related to agreements Titan has with former shareholders based on the achievement of certain performance measures as well as transaction-related costs. Represents the projected run-rate annual pre-tax procurement synergies associated with the combined company’s enhanced scale. Estimated pro forma interest expense. As reported in GMS's June 28, 2018 earnings release statement. Calculated assuming all equipment was acquired under capital leases or purchased as opposed to operating leases and were, accordingly, 100% year-one tax deductible. Normalized cash tax rate based on the Tax Cuts and Jobs Act of 2017. Includes $35 million of rollover equity from Titan management, assuming a $31.00 share price of GMS common stock. Based on financial information provided by Titan, calculated using 12/31/17 audited financial statements rolled forward for January through April 2018’s unaudited results. For illustrative purpose only. Not prepared in accordance with Regulation S-X pro forma requirements. Actual results may vary. See “Forward-Looking Statement Safe Harbor” on page 2 of this presentation. FY 2018 Pro Forma Adjusted EPS Reconciliation +22.6% ($ in millions, except share and per share data) (Unaudited) FY 2018 Reported (1) GMS Tax Adjustments (6) FY 2018 GMS PF Titan Acquisition (9) FY 2018 Combined GMS PF (10) Pre-Tax Income (Loss) (1) $83.854 $83.854 ($18.105) $65.749 EBITDA Add-backs (2) 18.582 18.582 23.658 42.240 Write-off of discount and deferred financing fees 0.074 0.074 0.074 Cost synergies (3) 10.000 10.000 Estimated Pro-forma Interest (4) (26.267) (26.267) Purchase Acct-Depr & Amort - Legacy 17.000 17.000 Purchase Acct-Depr & Amort - GMS 21.271 21.271 30.000 51.271 Adjusted Pre-Tax Income (5) 123.781 - 123.781 36.286 160.067 Adjusted Income Tax Expense (6) 39.077 (14.224) 24.853 10.660 35.513 Adjusted Net Income $84.704 14.224 $ $98.928 $25.626 $124.554 Effective Tax Rate - Pro-forma (7) 31.6% 20.1% 22.2% Weighted average shares outstanding-Diluted (8) 42,163 42,163 1,129 43,292 Adjusted Net income per share-Diluted $2.01 0.34 $ $2.35 $0.53 $2.88 Accretion vs. FY 2018 GMS PF

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