TLDR:
- Griffon Corporation’s Q4 earnings jumped 49% YoY to $62.5M ($1.29 per share)
- Revenue grew 2.9% to $659.7M, beating analyst expectations
- Board approved $400M share buyback and 20% dividend increase
- Company tripled annual net income to $209.9M with $326M free cash flow
- 2025 outlook: $2.6B revenue target with adjusted EBITDA of $575-600M
A robust fourth quarter performance has capped off a remarkable year for Griffon Corporation (NYSE:GFF), with the company reporting substantial earnings growth and announcing enhanced shareholder returns. The manufacturing conglomerate saw its stock surge 8.6% following the earnings announcement.
For the fourth quarter of fiscal 2024, Griffon reported earnings of $62.5 million, or $1.29 per share, marking a 49% increase from the same period last year. The adjusted earnings reached $1.47 per share, surpassing analyst predictions of $1.18. Quarterly revenue climbed 2.9% to $659.7 million, exceeding market expectations of $641.24 million.
The company’s Home and Building Products (HBP) and Consumer and Professional Products (CPP) segments drove the growth, contributing to a 13.4% increase in adjusted EBITDA, which reached $137.53 million. The EBITDA margin expanded by 194 basis points year-over-year to 20.9%.
Looking at the full fiscal year 2024, Griffon’s performance showed marked improvement across key metrics. The company tripled its net income to $209.9 million, while generating free cash flow of $326 million. Despite revenue slightly declining to $2.6 billion from $2.7 billion the previous year, adjusted EBITDA grew 2% to $513.6 million.
In a move to reward shareholders, Griffon’s board approved a substantial capital return program. This includes a new $400 million share buyback authorization and a 20% increase in the quarterly dividend to $0.18 per share. The enhanced dividend will be paid on December 18 to shareholders of record as of November 25.
During fiscal 2024, the company demonstrated its commitment to shareholder returns by deploying $310 million through dividends and share repurchases. In the fourth quarter alone, Griffon bought back 1.1 million shares for $68.4 million at an average price of $65.09 per share.
The CPP division’s transition to an asset-light model has yielded positive results, optimizing operations and enhancing margins. Meanwhile, the HBP segment capitalized on increased residential demand to drive growth.
Financial stability remains a priority, with leverage maintained at 2.6x net debt to EBITDA. As of September 30, 2024, the company reported $114.4 million in cash and total debt of $1.52 billion, resulting in net debt of $1.41 billion. The company maintains $379.3 million in available credit facility.
For fiscal 2025, Griffon projects revenue to hold steady at $2.6 billion, with adjusted EBITDA expected to range between $575 million and $600 million. Capital expenditures are planned at $65 million, with depreciation and amortization estimated at $42 million and $23 million respectively.
The company’s operational strategy includes continued modernization investments and debt reduction while pursuing growth opportunities. Free cash flow is expected to exceed net income in the coming fiscal year.
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