Trex Company Inc (TREX) 2024 Q3 法說會逐字稿

Good day, and welcome to the Trex Company third quarter 2024, earnings conference call. (Operator Instructions) Please note this event is being recorded. I would now like to turn the conference over to Casey Kotary, Investor Relations representative. Please go ahead.

美好的一天，歡迎參加 Trex 公司 2024 年第三季財報電話會議。（操作員說明）請注意此事件正在被記錄。我現在想將會議交給投資者關係代表凱西·科塔里 (Casey Kotary)。請繼續。

Thank you, everyone, for joining us today. With us on the call are Bryan Fairbanks, President and Chief Executive Officer; and Brenda Lovik, Senior Vice President and Chief Financial Officer.Joining Brian and Brenda is Amy Fernandez, Senior Vice President, Chief Legal Officer and Secretary; as well as other members of Trex management.

謝謝大家今天加入我們。與我們一起參加電話會議的有總裁兼執行長 Bryan Fairbanks；與布萊恩和布倫達一起加入的是高級副總裁、首席法務官兼秘書艾米·費爾南德斯 (Amy Fernandez)；以及 Trex 管理層的其他成員。

The company issued a press release today after market close containing financial results for the third quarter of 2024. This release is available on the company's website. This conference call is also being webcast and will be available on the Investor Relations page of the company's website for 30 days.

該公司今天在收盤後發布了一份新聞稿，其中包含 2024 年第三季的財務業績。該版本可在公司網站上取得。本次電話會議也將進行網路直播，並將在公司網站的投資者關係頁面上發布 30 天。

I will now turn the call over to Amy Fernandez. Amy?

我現在將把電話轉給艾米·費爾南德斯。艾米？

Thank you, Casey. Before we begin, let me remind everyone that statements on this call regarding the company's expected future performance and conditions constitute forward-looking statements within the meaning of federal securities laws.

謝謝你，凱西。在開始之前，讓我提醒大家，本次電話會議中有關公司預期未來業績和狀況的聲明構成聯邦證券法含義內的前瞻性聲明。

These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. For a discussion of such risks and uncertainties, please see our most recent Form 10-K and Form 10-Q as well as our 1933 and other 1934 Act filings with the SEC.

這些陳述受到某些風險和不確定性的影響，可能導致實際結果與前瞻性陳述中表達的結果有重大差異。有關此類風險和不確定性的討論，請參閱我們最新的 10-K 表格和 10-Q 表格以及我們向 SEC 提交的 1933 年和其他 1934 年法案文件。

Additionally, non-GAAP financial measures will be referenced in this call. A reconciliation of these measures to the comparable GAAP financial measure can be found in our earnings press release at trex.com. The company expressly disclaims any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

此外，本次電話會議也將引用非公認會計準則財務指標。這些指標與可比較的 GAAP 財務指標的調整可以在我們在 trex.com 上發布的收益新聞稿中找到。該公司明確表示不承擔公開更新或修改任何前瞻性陳述的義務，無論是由於新資訊、未來事件或其他原因。

With that introduction, I will turn the call over to Brian Fairbank.

介紹完畢後，我會將電話轉給布萊恩‧費爾班克 (Brian Fairbank)。

Thank you, Amy, and thank you all for joining us to review our third quarter results and discuss our business outlook.

謝謝艾米，也感謝大家與我們一起回顧我們的第三季業績並討論我們的業務前景。

We are proud that our team delivered third quarter results that surpassed expectations, thanks to the continued consumer demand for our premium priced products. We estimate sell-through for our premium products increased at a high single-digit rate in the third quarter and contracted lead times averaged six to eight weeks, in line with the norm for this point of the season. Additionally, sell-through of our lower-priced products remained stable with second quarter levels.

我們感到自豪的是，由於消費者對我們高價產品的持續需求，我們的團隊第三季的業績超出了預期。我們估計，第三季度我們的優質產品的銷售量將以高單位數速度增長，合約交貨時間平均為六到八週，與本季此時的正常情況相符。此外，我們低價產品的銷售量與第二季的水平保持穩定。

On a year-to-date basis, sell-through across our entire portfolio was flat with the prior year, keeping in mind that our definition of sell-through includes only point-of-sale transactions at both home centers and within the Pro channel.

今年迄今為止，我們整個投資組合的銷售量與前一年持平，請記住，我們對銷售量的定義僅包括家居中心和專業管道內的銷售點交易。

Concurrently, our distribution partners reduced their inventory in the third quarter by approximately $70 million, in line with our expectations and resulting in what we consider normalized inventory levels for this point in the season.

同時，我們的分銷合作夥伴在第三季將庫存減少了約 7,000 萬美元，符合我們的預期，並導致我們認為本季此時的庫存水準正常。

As expected, we maintained our gross margin close to last year's adjusted level, thanks to the success of our continuous cost reduction programs, which partially offset the effect of lower utilization rates while EBITDA margin improved from diligently managed SG&A spending.

正如預期的那樣，我們的毛利率保持在接近去年調整後的水平，這要歸功於我們持續的成本削減計劃的成功，這部分抵消了利用率較低的影響，而EBITDA 利潤率則因認真管理的銷售、管理和行政費用而有所改善。

This performance positions us to increase our EBITDA margin guidance for the full year of 2024, to 30.5% and the high end of our original guidance range. New product development remains a strategic priority and a key driver of future double-digit growth for Trex.

這項業績使我們能夠將 2024 年全年 EBITDA 利潤率指引提高至 30.5%，也是我們最初指導範圍的上限。新產品開發仍然是 Trex 的戰略重點和未來兩位數成長的關鍵驅動力。

Products launched within the last 36 months accounted for approximately 18% of our year-to-date net sales of $984 million, demonstrating how well aligned our products are with consumer preferences. This year, we further accelerated the pace of new product launches to capitalize on the significant railing opportunity as reviewed during our Investor Day last year.

過去 36 個月內推出的產品約占我們年初至今淨銷售額 9.84 億美元的 18%，顯示我們的產品與消費者偏好的契合程度。今年，我們進一步加快了新產品推出的步伐，以利用去年投資者日期間回顧的重大機會。

Entered adjacencies that represented logical extensions of our product lines and a greater share of the wood conversion market. Last week, we issued a detailed release highlighting the latest additions to our product portfolio that will be available for the 2025, season.

進入代表我們產品線的邏輯延伸和木材加工市場更大份額的鄰近地區。上週，我們發布了一份詳細新聞稿，重點介紹了我們將於 2025 年季節推出的產品組合的最新內容。

Among the introductions were new steel, aluminum, cable and glass railing systems along with enhancements to the Trex Select composite railing system designed to compete with vinyl railing and wood railing. These new railing products strengthen our portfolio and position Trex to significantly increase our penetration of the $3.3 billion railing market.

其中推出了新的鋼、鋁、電纜和玻璃欄桿系統，以及旨在與乙烯基欄桿和木質欄桿競爭的 Trex Select 複合欄桿系統的增強功能。這些新的欄桿產品增強了我們的產品組合，並使 Trex 能夠顯著提高我們在價值 33 億美元的欄桿市場的滲透率。

We project the doubling of our share of the highly fragmented residential railing market from approximately 6% today to 12% share over the next five years. Another new development is the addition of four nicking colors, two for our premium transcend lineage line and two for Trex Enhance stacking line.

我們預計在未來五年內，我們在高度分散的住宅欄桿市場的份額將翻一番，從目前的約 6% 增加到 12%。另一項新開發是增加了四種刻痕顏色，兩種用於我們的優質超越譜系系列，兩種用於 TrexEnhance 堆疊系列。

All of these new colors integrate our proprietary heat mitigating technology to capitalize on the growing popularity of heat reduction. To learn more about our heat mitigating technology, please see a press release from earlier today and on our website.

所有這些新顏色都整合了我們專有的散熱技術，以利用日益流行的散熱技術。要了解有關我們的散熱技術的更多信息，請參閱今天早些時候和我們網站上的新聞稿。

In the decking hardware category, we announced the continued rollout of the Trex Fastener connection, which gives our channel partners a competitive edge by allowing them to deliver end-to-end solutions from one supplier with these components backed by the same warranties as our decking.

在裝飾硬體類別中，我們宣布繼續推出Trex Fastener 連接，這為我們的通路合作夥伴提供了競爭優勢，使他們能夠從一家供應商提供端到端解決方案，這些組件與我們的裝飾享有相同的保固。

For example, when paired with Trex Transandecking, fasteners are backed by a 50-year residential warranty. Our channel partners are working closely with us to maximize the benefits of these new Trex product introductions.

例如，與 Trex Transandecking 搭配使用時，緊固件可享有 50 年住宅保固。我們的通路合作夥伴正在與我們密切合作，以最大限度地發揮這些新推出的 Trex 產品的優勢。

Recently, we shared the news of Snavely forest products, a long time, an exclusive distributor of Trex -- decided to sell Trex railing exclusively as well, displacing their previous suppliers and adding Colorado to their distribution coverage for Trex.

最近，我們分享了 Trex 獨家經銷商 Snavely 森林產品的消息 - 決定也獨家銷售 Trex 欄桿，取代他們之前的供應商，並將科羅拉多州添加到他們的 Trex 分銷範圍內。

Similar discussions are underway with a number of our exclusive decking distributors, and we expect to have additional announcements such as us in the coming months. As distributors adopt exclusivity for Trex railing, we expect to focus on a single brand will have a multiplier effect on both our decking and railing sales.

我們正在與一些獨家裝飾經銷商進行類似的討論，我們預計在未來幾個月內會像我們一樣發布更多公告。由於經銷商採用 Trex 欄桿的獨家經營權，我們預計將專注於單一品牌將對我們的裝飾和欄桿銷售產生乘數效應。

This reinforces our confidence in our ability to gain substantial share of the residential railing market with our complete product portfolio and to harvest opportunities in adjacent markets to drive further incremental growth. The development of our Arkansas facility is a critical aspect of our future growth trajectory.

這增強了我們的信心，相信我們有能力憑藉完整的產品組合在住宅欄桿市場中獲得大量份額，並在鄰近市場獲得機會，推動進一步的增量成長。阿肯色州工廠的發展是我們未來成長軌跡的一個重要面向。

And as promised, we want to share with you the latest update on the expected timing and associated start-up costs. I will discuss the timing and then ask Brendan to review the costs. The substantial production efficiencies that we've achieved to date have yielded sufficient capacity at our existing manufacturing plant for us to accommodate the projected demand for Trex products in '25 and 2026, enabling us to commence decking production at our Arkansas campus in the first half of 2027.

正如承諾的那樣，我們希望與您分享有關預期時間和相關啟動成本的最新更新。我將討論時間安排，然後請布倫丹審查費用。迄今為止，我們取得的顯著生產效率已在我們現有的製造工廠產生了足夠的產能，可以滿足25 年和2026 年對Trex 產品的預計需求，使我們能夠在上半年開始在阿肯色州園區生產地板2027 年。

Recycled plastic processing will begin in the first quarter of 2025. The output of this operation will be used at our Virginia and Nevada facilities and eliminate the need to purchase more expensive external pelletized recycled materials. We continue to adopt a modular approach to the development of the Arkansas campus, bringing on production lines in line with demand.

再生塑膠加工將於 2025 年第一季開始。該工廠的產出將用於我們的維吉尼亞州和內華達州工廠，無需購買更昂貴的外部顆粒狀回收材料。我們繼續採用模組化方法來開發阿肯色州園區，根據需求引進生產線。

Once completed, this will be our most efficient production site as it will incorporate our latest proprietary equipment and technology. It is located near central raw materials and is in close proximity to key regions for wood conversion and is adjacent to major transportation hubs that will offer lower freight for centrally located customers.

建成後，這將成為我們最高效的生產基地，因為它將採用我們最新的專有設備和技術。它位於中心原材料附近，靠近木材加工的關鍵區域，並毗鄰主要交通樞紐，可為位於中心的客戶提供較低的運費。

When Arkansas is fully operational, Trex will have total manufacturing capacity in excess of $2 billion approximately double our current size. While we will still have elevated capital spending in 2025, with the completion of the decking building and installation of the decking lines, capital spending will significantly decline in 2026, and beyond.

當阿肯色州全面投入營運時，Trex 的總製造能力將超過 20 億美元，約為目前規模的兩倍。雖然到 2025 年我們的資本支出仍將增加，但隨著甲板建造和甲板線安裝的完成，資本支出將在 2026 年及以後大幅下降。

Looking ahead, we believe that the repair and remodel market will return to low single-digit growth in 2025, supported by lower interest rates and increased home turnover and homebuilding activity. Trex has consistently outperformed the R&R index by a significant margin, and we expect to do so again next year, with our results further strengthened by new products, more to come on that when we provide our guidance next year.

展望未來，我們認為，在利率下降、房屋成交量和房屋建築活動增加的支持下，維修和改造市場將在 2025 年恢復到低個位數成長。Trex 的表現一直大幅優於 R&R 指數，我們預計明年將再次表現出色，新產品將進一步增強我們的業績，當我們明年提供指導時，還會有更多產品出現。

Now I will turn the call over to our Senior Vice President and CFO, Brenda Lovcik, for a financial review. Brenda?

現在我將把電話轉給我們的高級副總裁兼財務長 Brenda Lovcik，以進行財務審查。布倫達？

Thank you, Brian, and good evening, everyone. I am pleased to review our third quarter 2024, and year-to-date results. Please note that unless otherwise noted, all comparisons I will discuss today are on a year-over-year basis compared to the third quarter and first nine months of fiscal 2023.

謝謝你，布萊恩，大家晚上好。我很高興回顧我們 2024 年第三季和年初至今的業績。請注意，除非另有說明，我今天討論的所有比較都是與 2023 財年第三季和前 9 個月的同比比較。

In the third quarter, net sales for $234 million, a decrease of 23% compared to $304 million in 2023, driven primarily by the $70 million reduction in channel inventory during the quarter.

第三季淨銷售額為 2.34 億美元，與 2023 年的 3.04 億美元相比下降 23%，這主要是由於該季度通路庫存減少了 7,000 萬美元。

Overall sales are slightly ahead of our expectations driven by solid consumer demand for our premium product lines led by our Trex, transcend lineage and signature decking and railing, while consumer spending on our lower-priced products remained restrained.

整體銷售額略高於我們的預期，這是由於消費者對以Trex、transcend lineage 和標誌性裝飾和欄桿為首的優質產品線的強勁需求所推動，而消費者對我們低價產品的支出仍然受到限制。

This behavior was consistent with what we saw during the second quarter. Gross margin was 39.9%, down 190 basis points from 41.8% after adjusting for the warranty benefit recognized in the prior year period. This decrease is primarily the result of lower utilization partially offset by the benefits of our continuous improvement initiatives, which continue to deliver strong results.

這種行為與我們在第二季度看到的情況一致。在調整上年期間確認的保固福利後，毛利率為 39.9%，較上年同期的 41.8% 下降 190 個基點。這一下降主要是由於利用率較低，部分被我們持續改進計劃的好處所抵消，這些計劃繼續帶來強勁的成果。

Selling, general and administrative expenses were $39 million or 16.6% of net sales in the third quarter compared to $45 million or 14.7% of net sales primarily related to lower incentive compensation which more than offset marketing spend as we continue to invest in new product innovation and branding as those investments have proven to deliver healthy returns.

第三季銷售、一般和管理費用為3,900 萬美元，佔淨銷售額的16.6%，而第三季為4,500 萬美元，佔淨銷售額的14.7%，這主要與較低的激勵薪酬有關，這遠遠抵消了我們繼續投資於新產品創新的行銷支出和品牌建設，因為這些投資已被證明可以帶來健康的回報。

Net income was $41 million in the third quarter or $0.37 per diluted share, a decrease of 38% from $65 million or $0.60 per diluted share. We delivered EBITDA of $68 million or 29.1% of net sales, down 32% compared to $99 million or 32.7% of net sales. Excluding the warranty benefit, the third quarter 2023, net income was $62 million or $0.57 per diluted share, EBITDA was $96 million and EBITDA margin was 31.5%.

第三季淨利為 4,100 萬美元，即稀釋後每股收益 0.37 美元，較 6,500 萬美元或稀釋後每股收益 0.60 美元下降 38%。我們的 EBITDA 為 6,800 萬美元，佔淨銷售額的 29.1%，比 9,900 萬美元或淨銷售額的 32.7% 下降了 32%。不含保固福利，2023 年第三季淨利為 6,200 萬美元，或稀釋後每股收益 0.57 美元，EBITDA 為 9,600 萬美元，EBITDA 利潤率為 31.5%。

From a year-to-date perspective, net sales for the first nine months of 2024, totaled $984 million a 9% increase compared to $899 million in the first nine months of 2023. This is primarily due to the shift of our early buy program from December to January.

從年初至今的角度來看，2024 年前 9 個月的淨銷售額總計 9.84 億美元，比 2023 年前 9 個月的 8.99 億美元成長 9%。這主要是由於我們的早期購買計劃從 12 月改為 1 月。

Net income was $217 million or $1.99 per diluted share compared to $183 million or $1.69 per diluted share in the first nine months of 2023.

淨利潤為 2.17 億美元，即稀釋後每股收益 1.99 美元，而 2023 年前 9 個月的淨利潤為 1.83 億美元，即稀釋後每股收益 1.69 美元。

EBITDA was $331 million or 16% from $285 million in the prior year, and EBITDA margin expanded by 200 basis points to 33.7% and from 31.7% in 2023, driven primarily by stronger year-over-year gross margin improvement.

EBITDA 為 3.31 億美元，較上一年的 2.85 億美元增長 16%，EBITDA 利潤率增長 200 個基點，從 2023 年的 31.7% 增至 33.7%，這主要是由於毛利率同比強勁改善。

Year-to-date, operating cash flow was $152 million, compared to $288 million in 2023. The decrease was primarily a result of increased railing and decking inventories as we prepare to execute on our new railing strategy and prepare for the 2025, decking season. This was partially offset by an increase in accrued expenses associated with construction on our Arkansas manufacturing facility.

年初至今，營運現金流為 1.52 億美元，而 2023 年為 2.88 億美元。減少的主要原因是欄桿和裝飾庫存增加，因為我們準備好執行新的欄桿策略並為 2025 年裝飾季節做好準備。這被阿肯色州製造工廠建設相關的應計費用增加部分抵消。

In alignment with our capital allocation strategy, as of today, we have returned over $100 million to our shareholders this year through the repurchase of 1.6 million shares of our outstanding common stock. We also invested $152 million in capital expenditures year-to-date, primarily related to the build-out of the Arkansas facility.

根據我們的資本配置策略，截至今天，我們今年已透過回購 160 萬股已發行普通股向股東返還超過 1 億美元。年初至今，我們也投資了 1.52 億美元的資本支出，主要與阿肯色州工廠的擴建有關。

The total CapEx for this facility is expected to be approximately $550 million, of which we have already invested $340 million. The increase from our prior guidance for the project reflects management's decision to build redundancies to mitigate potential production constraints within our existing manufacturing facilities as well as inflationary pressures on installation and building material costs.

該設施的總資本支出預計約為 5.5 億美元，其中我們已經投資了 3.4 億美元。與我們先前對該專案指引的增加反映了管理層決定進行裁員，以減輕我們現有製造設施內潛在的生產限制以及安裝和建築材料成本的通膨壓力。

Once this project is completed, our capital expenditures are expected to return to historical levels resulting in a significant increase in our annual free cash flow generation. Now moving on to our Arkansas facility start-up cost discussion. As Bryan noted earlier, recycled plastic processing will begin in early 2025.

一旦該項目完成，我們的資本支出預計將恢復到歷史水平，從而使我們的年度自由現金流量顯著增加。現在繼續討論我們阿肯色州工廠的啟動成本。正如 Bryan 早些時候指出的那樣，再生塑膠加工將於 2025 年初開始。

And by utilizing the output as raw material in the Winchester and friendly facilities, it will help to offset the start-up costs by reducing purchase pellets at those facilities. We expect the associated onetime start-up costs to total approximately $5 million and the associated annualized depreciation of approximately $10 million to begin in the second quarter of 2025.

透過利用溫徹斯特工廠和友好設施的產出作為原材料，減少這些設施的顆粒採購量將有助於抵消啟動成本。我們預計從 2025 年第二季開始，相關的一次性啟動成本總計約為 500 萬美元，相關的年化折舊約為 1000 萬美元。

These operations are expected to run at targeted utilization rates by the third quarter of 2025, with start-up costs ending at this point. As Bryan also mentioned, we have been able to shift the start-up of our decking lines to the beginning of 2027, due to efficiencies gained at our existing facilities.

這些業務預計將在 2025 年第三季之前達到目標利用率，啟動成本將在此時結束。正如布萊恩也提到的，由於我們現有設施的效率提高，我們已經能夠將甲板生產線的啟動時間推遲到 2027 年初。

At that time, we anticipate the onetime start-up costs to be approximately $12 million beginning in the first half of 2027, with the associated annualized depreciation of approximately $20 million beginning at the same time.

屆時，我們預計從 2027 年上半年開始的一次性啟動成本約為 1,200 萬美元，同時開始的相關年化折舊約為 2,000 萬美元。

We expect these operations will be running at targeted utilization rates by the end of 2027. Once these start-up expenses are behind us, not only will Arkansas be our most efficient plant, but it will also enable us to increase the flexibility and efficiencies of our legacy facilities.

我們預計到 2027 年底這些業務將按照目標利用率運作。一旦這些啟動費用過去，阿肯色州不僅將成為我們最高效的工廠，而且還將使我們能夠提高傳統設施的靈活性和效率。

Now turning to the guidance for the remainder of 2024, as noted in today's earnings release. Based on our results for the first nine months of 2024, and our current visibility through year-end, we are pleased to reaffirm net sales guidance at the midpoint of our range of $1.14 billion, and we expect EBITDA margins to reach the high end of our guidance of 30.5%.

現在轉向 2024 年剩餘時間的指導，如今天的收益發布中所述。根據我們 2024 年前 9 個月的業績以及我們目前到年底的能見度，我們很高興重申淨銷售額指引為 11.4 億美元的中點，並且我們預計 EBITDA 利潤率將達到 2024 年的高端。為30.5%。

Full year SG&A expense as a percentage of net sales is expected to be in line with last year as we continue to invest in branding and new product development. In addition, we anticipate our full year effective tax rate to be approximately 25% to 26%. Our net sales guidance implies Q4 sales of approximately $156 million at the midpoint.

隨著我們繼續投資於品牌建立和新產品開發，全年銷售、管理及行政費用佔淨銷售額的百分比預計將與去年持平。此外，我們預計全年有效稅率約為 25% 至 26%。我們的淨銷售額指引意味著第四季度銷售額中位數約為 1.56 億美元。

This guidance assumes the repair and remodel market continues to be challenged with low single-digit declines. It also assumes end consumer sell-through will continue to be challenged with low single-digit declines, albeit off of a much smaller quarterly base.

本指南假設維修和改造市場繼續面臨個位數下降的挑戰。它還假設終端消費者銷售量將繼續面臨個位數下降的挑戰，儘管季度基數要小得多。

We also anticipate the market will reduce channel inventory by $20 million to $30 million in addition to the $70 million in Q3, ending the year at lower-than-normal inventory weeks on hand.

我們也預計，除了第三季的 7,000 萬美元之外，市場還將減少 2,000 萬至 3,000 萬美元的通路庫存，年底庫存週數將低於正常水準。

With that, I will now turn the call back to Bryan for his closing remarks.

現在，我將把電話轉回給布萊恩，讓他作結束語。

Thank you, Brenda. We believe Trex is in a unique position to capture a greater share of the industry's long-term growth opportunities. We are the market leader with the greatest brand awareness and the largest and most trusted network of distributors, dealers and home centers.

謝謝你，布倫達。我們相信 Trex 處於獨特的地位，可以在行業的長期成長機會中獲得更大的份額。我們是市場領導者，擁有最高的品牌知名度和最大、最值得信賴的經銷商、經銷商和家居中心網絡。

Our expanded railing portfolio and adjacent products are earning Trex's exclusivity amongst our distributors and opening additional shelf space opportunities with home centers and prochannel dealers. And our new product introductions have resonated well with contractors and consumers. All of this supports our confidence in the growth trajectory for Trex in the coming years.

我們擴展的欄桿產品組合和相鄰產品使 Trex 在我們的經銷商中贏得了獨家地位，並為家居中心和專業通路經銷商提供了額外的貨架空間機會。我們推出的新產品引起了承包商和消費者的強烈共鳴。所有這些都支持了我們對 Trex 未來幾年成長軌蹟的信心。

Operator, please open the call for questions.

接線員，請打開電話提問。

(Operator Instructions) Ryan Merkel, William Blair.

（操作員指示）瑞安·默克爾、威廉·布萊爾。

Congrats on the quarter. My first question is just on the fourth quarter assumptions. I think you said down low single digits for sell-through. I'm curious if I heard that right. And then what does that assume about the premium products and the lower-end products?

恭喜本季。我的第一個問題只是關於第四季的假設。我想你說的是低個位數的銷售率。我很好奇我是否聽對了。那麼對於高階產品和低階產品又有何假設呢？

Right. We did say low single digits from a sell-through perspective. Our premium products during the quarter sold through at a high single digit and then our entry-level products were in a mid-single-digit decline.

正確的。從銷售的角度來看，我們確實說過低個位數。我們的高端產品在本季度的銷量達到了高個位數，然後我們的入門級產品出現了中個位數的下降。

Got it...

知道了...

-- Yes. we are expecting that to continue in Q4.

- 是的。我們預計這種情況將在第四季繼續下去。

Okay. Good. That's what I thought. And then how do we think about the EBITDA margin guide for '25 exceeding 31%. Are you simply saying or signaling that ex the onetime cost, you can keep expanding margins due to cost takeout? Or is there anything else in there?

好的。好的。我就是這麼想的。然後我們如何看待 25 年超過 31% 的 EBITDA 利潤率指南。您是否只是在說或暗示，除了一次性成本之外，您可以透過成本削減來不斷擴大利潤？或是裡面還有其他東西嗎？

No, that's correct. So excluding those onetime costs with the startup costs in Arkansas as well as the railing transition costs, we'll continue to expand those margins.

不，這是正確的。因此，排除那些一次性成本、阿肯色州的啟動成本以及欄桿過渡成本，我們將繼續擴大這些利潤。

Rafe Jadrosich, Bank of America.

拉夫·賈德羅西奇，美國銀行。

I just wanted to ask on the inventory side. If I look at your inventory days on hand, they're a lot higher than where they've been historically, especially if we go back to to maybe pre-COVID. Can you just talk about why you're carrying more inventory now? Is there a structural change? Or is this related to the railing launch next year and just getting ready for the deck and season next year?

我只是想問一下庫存方面。如果我看看你手頭上的庫存天數，它們比歷史上的水平要高得多，特別是如果我們回到新冠疫情之前。您能談談為什麼您現在持有更多庫存嗎？有結構性變化嗎？或者這與明年推出欄桿有關，並為明年的甲板和季節做好準備？

Yeah, we've talked about this a number of times over the past six months. It is twofold. First, it is driven by the new product launches that are coming up. A couple of products are already in the market, but most of them will be coming into the market beginning of next year.

是的，在過去的六個月裡我們已經多次討論過這個問題。這是雙重的。首先，它是由即將推出的新產品所推動的。一些產品已經推出市場，但大多數將於明年初推出市場。

The second part of it is that for a long time, we've ramped our capacity up during the busiest parts of the season and pulled it back later on in the year. Given the size of the organization that we are today, we believe it makes more sense to carry a little bit heavier inventory and then reduce the amount of increases and decreases that we put the operations through. It reduces the amount of hiring that we have to bring people in.

第二部分是，長期以來，我們在季節最繁忙的時期提高了產能，並在今年稍後將其收回。考慮到我們今天的組織規模，我們認為增加一點庫存，然後減少我們營運中的增減量更有意義。它減少了我們必須引進的招募量。

When we bring a line on, we can keep that line running. We can keep the efficiencies at a high level. So there is a piece of it that will be structural in nature, and we will run with generally higher levels of inventory when we get to the year-end as compared to what you've seen in the prior years.

當我們接通一條線路時，我們可以保持該線路運行。我們可以將效率保持在高水準。因此，其中一部分本質上是結構性的，與前幾年相比，到年底時我們的庫存水準通常會更高。

That's really helpful. And that makes a lot of sense. And then just on the 31 -- over 31% EBITDA margin target for next year, is there an embedded revenue assumption? Or is that based on the R&R market getting back to low single digit? Can you just talk about the different levers that you have to pull to give you confidence to talk to about 31% for next year already?

這真的很有幫助。這很有意義。然後就在 31 號——明年 EBITDA 利潤率目標超過 31% 時，是否有一個嵌入的收入假設？還是這是基於 R&R 市場回到低個位數的情況？您能談談您必須採取哪些不同的手段才能讓您有信心與大約 31% 的人談論明年的情況嗎？

Yeah. As we're looking at it right now, there is a -- we have a base assumption of it going back into the mid-single digits, which will drive our growth. We're not providing guidance on that number right now. But as we mentioned in the call, we have consistently outperformed that number. And we do think that there are a number of underlying economic metrics that will support getting repair and remodel back to growth again.

是的。正如我們現在所看到的，我們有一個基本假設，即它將回到中個位數，這將推動我們的成長。我們目前不提供有關該數字的指導。但正如我們在電話中提到的，我們的表現一直優於這個數字。我們確實認為，有許多基本經濟指標將支持修復和改造再次恢復成長。

Keith Hughes, Truist.

基斯‧休斯，真理主義者。

The commentary on channel inventory reduction $20 million to $30 million in the fourth quarter. Is that all in big box? Are you seeing it in other channels?

評論第四季通路庫存減少2000萬至3000萬美元。都是在大盒子裡嗎？您在其他管道看過嗎？

That's primarily going to be in our distribution channel. Yeah, with the home center channel, that's managed through consignment when we ship into their distribution centers, still our inventory. And then from there, when it shifts to the stores when we book revenue.

這主要是在我們的分銷管道中。是的，透過家庭中心管道，當我們運送到他們的配送中心時，透過寄售進行管理，仍然是我們的庫存。然後從那裡開始，當我們登記收入時，它就會轉移到商店。

So there's high visibility to that. We know exactly where that's going to be. With the pro channel distributors, while we still have good visibility of that. It's not managed on a consignment basis, and that's where we'll see the decrease.

因此，這一點的可見度很高。我們確切地知道那會在哪裡。對於專業通路經銷商，我們仍然有很好的知名度。它不是在寄售的基礎上進行管理，這就是我們會看到下降的地方。

Okay. And second question with the recycled plastic startup in Arkansas. I think you said earlier, was going to be replacing, I assume you mean virgin pellets at the two other facilities. Number one, is that right? And number two, even with transportation costs, is that still a cheaper landed cost for those plants?

好的。第二個問題是關於阿肯色州的再生塑膠新創公司。我想你之前說過，要更換，我想你指的是另外兩個設施的原始顆粒。第一，是嗎？第二，即使考慮到運輸成本，對於這些工廠來說，到岸成本是否仍然更便宜？

We don't use virgin pellets in our operations, but we do buy some outside palletized recycled materials, and this material will replace that. And yes, there will be a cost benefit to that.

我們在營運中不使用原始顆粒，但我們確實購買了一些外部托盤回收材料，這種材料將取代它。是的，這會帶來成本效益。

Reuben Garner, Benchmark Company.

魯本·加納，基準公司。

Question on the railing. You referenced a onetime $5 million cost. Any way to gather what exactly that cost is tied to and what the revenue benefit might be from those particular costs?

關於欄桿的問題。您提到了一次性成本 500 萬美元。有什麼方法可以收集該成本到底與什麼相關以及這些特定成本可能帶來的收入收益是什麼？

Yeah, that will be -- as we launch into the marketplace, a certain level of transition costs as we bring more merchandising into the market. We need to make sure that all of our dealers as well as home centers are properly merchandised all the literature is up to date.

是的，當我們進入市場時，隨著我們將更多的商品引入市場，將會產生一定程度的過渡成本。我們需要確保我們所有的經銷商和家居中心都得到適當的銷售，所有文獻都是最新的。

And this is a -- we've got many more launches over the upcoming four or five months than we've had in the history of the company. So there is some cost to get that into the market and get it done correctly.

在接下來的四、五個月裡，我們推出的產品比公司歷史上的還要多。因此，將其推向市場並正確完成需要一些成本。

Okay. Then my second question is a clarification on the inventory drawdown at distribution. You referenced kind of the entry-level product and customer being a little more hit the last couple of quarters. Am I connecting the wrong dots here is the product that's being drawn down at distribution, the same product? Or are those two different sort of pressures that you're facing, an inventory draw down to distribution and then a slower consumer at the retail big box channel?

好的。那麼我的第二個問題是對分銷時庫存減少的澄清。您提到了入門級產品和客戶在過去幾季受到更大的打擊。我是否在這裡連接了錯誤的點，即在分銷時提取的產品，同一個產品？或者您面臨著兩種不同的壓力，即庫存減少到分銷，然後是零售大賣場管道的消費者放緩？

Distributors have already adjusted their inventories, understanding that entry-level market is going to be a little bit weaker. But as we did our surveys with distribution and understanding where they wanted to come in, for year-end, understanding the new products that we're going to have for next year. The channel inventory is a little bit lighter than what we had expected coming out of the second quarter, but nothing that we're concerned about.

經銷商已經調整了庫存，了解入門級市場將會稍微疲軟。但當我們對分銷進行調查並了解他們想在年底進入何處時，了解我們明年將推出的新產品。通路庫存比我們對第二季的預期要少一些，但我們並不擔心。

Susan Maklari, Goldman Sachs.

蘇珊·馬克拉里，高盛。

My first question is on the inventories. You mentioned the $20 million to $30 million drawdown in the fourth quarter. What does that suggest as you go into the prebuy early next year? And what are you hearing in terms of the level of demand that you could see as we start to get into the spring, given what the contractors are telling you?

我的第一個問題是關於庫存的。您提到第四季減少了 2000 萬至 3000 萬美元。當您明年初進入預購階段時，這意味著什麼？鑑於承包商告訴您的情況，當我們開始進入春季時，您所聽到的需求水平如何？

Well, so there's quite a bit of time before we get to pre-buy at this point, but people are feeling positive about next year that repair and remodel numbers do come back into positive territory. Recall, last year, we went ahead, we moved our December prebuy into the new year.

好吧，現在距離我們進行預購還有相當長的時間，但人們對明年的維修和改造數量確實會回到正值感到樂觀。回想一下，去年，我們繼續前進，將 12 月的預購移至新的一年。

But then we also shipped an additional roughly $40 million on top of that. So the channel would be ready to support the season. Given our own inventory position at this point, I wouldn't expect that additional infill would occur during the first quarter next year. We're highly confident in our ability to be able to serve the marketplace.

但除此之外，我們還額外出貨了約 4,000 萬美元。因此該頻道已準備好支持本賽季。考慮到我們目前的庫存狀況，我預計明年第一季不會出現額外的填充。我們對服務市場的能力充滿信心。

Our sales team has good visibility to where the pro channel is sitting on inventory at any given time. And we feel as though this is a little bit better way to run the market rather than trying to push it in with incentives earlier in the year.

我們的銷售團隊可以很好地了解專業管道在任何特定時間的庫存情況。我們認為，與今年稍早試圖透過激勵措施推動市場相比，這是一種更好的市場運作方式。

Okay. That's helpful color. And then maybe thinking a bit about the gross margin. You mentioned that you did see the benefit of some cost reductions in there that offset the lower utilization this quarter. Any thoughts on further cost benefits that you could be realizing into year-end? And then any projects that you want to highlight, thinking about 2025?

好的。這是有用的顏色。然後也許會考慮一下毛利率。您提到您確實看到了一些成本降低的好處，抵消了本季較低的利用率。您對年底前可以實現的進一步成本效益有什麼想法嗎？那麼，考慮到 2025 年，您有什麼想要強調的項目嗎？

One of the things I talked about was, given the efficiency projects that we have underway, we are deferring the start-up of our decking operation in Little Rock that is driving some of that benefit that we're seeing. So we've got projects like that, that will be ongoing in the organization. We have an extremely sophisticated continuous improvement group where they really challenge everything within the organization. We've got dedicated engineers to going after these costs.

我談到的一件事是，考慮到我們正在進行的效率項目，我們推遲了小石城甲板業務的啟動，這正在推動我們所看到的一些好處。所以我們有這樣的項目，這些項目將在組織中持續進行。我們有一個極其複雜的持續改善小組，他們真正挑戰組織內的一切。我們有專門的工程師來處理這些成本。

And I wouldn't pin it on any one thing that we're going after. It's a good number of projects, and it continues to deliver benefits that, in some cases, offset other costs that are coming into the business, completely immune from any inflationary impacts. But generally, we've been able to offset those inflationary impacts as well as deliver other benefit to our income statement.

我不會把它寄託在我們正在追求的任何一件事上。這是一個相當多的項目，而且它繼續帶來好處，在某些情況下，抵消了進入業務的其他成本，完全不受任何通貨膨脹的影響。但總的來說，我們已經能夠抵消這些通膨影響，並為我們的損益表帶來其他好處。

John Lovallo, UBS.

約翰‧洛瓦洛，瑞銀集團。

The first one is you mentioned pushing out production of decking to 2027, in Arkansas and through some of the efficiencies that you've generated at existing plants.

第一個是您提到將阿肯色州的地板生產推遲到 2027 年，並透過現有工廠提高的一些效率。

Just curious if you could put a number on how much incremental capacity you were able to generate at these existing production facilities. And just really just making sure that there's nothing you're seeing on the demand side that's stopping the production at Arkansas.

只是好奇您能否給出一個數字，說明這些現有生產設施能夠產生多少增量產能。只是確保您在需求方面沒有看到任何東西導致阿肯色州的生產停止。

No, we're not going to put a number on those incremental efficiencies. I think probably what's more important is from when we launched Little Rock timing, the market has been somewhat weaker in 2023, and 2024. So that's definitely impacting that.

不，我們不會對這些增量效率給出具體數字。我認為可能更重要的是，從我們推出 Little Rock 的時機來看，2023 年和 2024 年市場有些疲軟。所以這肯定會影響這一點。

But also as we look at it, our own internal improvements allow us to be highly confident that we can meet the market needs with the existing capacity and then just bring on little rock just a little bit later.

但正如我們所看到的那樣，我們自己的內部改進使我們非常有信心，我們可以利用現有產能滿足市場需求，然後稍後再推出一些小項目。

Okay. That makes sense. And then it looks like you guys repurchased about $45 million of stock already this quarter. How should we think about your appetite through the remainder of the quarter and as we move forward at some of the little rocks up comes online?

好的。這是有道理的。看起來你們本季已經回購了約 4500 萬美元的股票。我們應該如何考慮您在本季度剩餘時間內的需求，以及隨著我們繼續前進，一些小驚喜上線了？

Yeah. So year-to-date, we've repurchased $100 million worth of shares, roughly an average price of $63 a share. We have an open program for roughly 10%. Now that's minus the $100 million we just bought, not exactly sure the percentage impact of that. But that program still is available to the company, and we coordinate with our Board of Directors and make decisions as to how we implement those 10b5-1 plans as we go forward.

是的。今年迄今為止，我們已經回購了價值 1 億美元的股票，平均價格約為每股 63 美元。我們有大約 10% 的開放計劃。現在這減去了我們剛剛購買的 1 億美元，不確定其影響的百分比。但該計劃仍然可供公司使用，我們與董事會協調並決定如何實施這些 10b5-1 計劃。

Michael Rehaut, JPMorgan.

麥可雷豪特，摩根大通。

First, I was just hoping to get a clarification on a couple of the comments around 2025, and apologies if I missed it, but the 31% or 31% or greater, if that number includes the Arkansas, some of the early Arkansas start-up costs and the railing transition that's inclusive of that. And also the mid-single-digit growth, if that was a reference to the R&R market or your own sales growth?

首先，我只是希望能在2025 年左右得到對一些評論的澄清，如果我錯過了，我很抱歉，但31% 或31% 或更高，如果這個數字包括阿肯色州，一些早期的阿肯色州新創公司——增加成本和包含在內的欄桿過渡。還有中個位數的成長，如果這是指 R&R 市場或您自己的銷售成長？

Yeah. The $31 million is adjusted for those onetime costs. So if we exclude those onetime costs of the $5 million the transition cost for railing and the $5 million of the onetime start-up costs for the reprolines. We expect 31-plus percent EBITDA line. And the single digit is for the R&R market. That's what we're expecting for R&R based on what we're seeing and hearing in the market right now for 2025.

是的。3100 萬美元針對這些一次性成本進行了調整。因此，如果我們排除 500 萬美元的欄桿過渡成本和 500 萬美元的複製品一次性啟​​動成本。我們預計 EBITDA 線將超過 31%。個位數是針對 R&R 市場的。根據我們目前在市場上的所見所聞，這就是我們對 2025 年 R&R 的預期。

Okay. Great. And maybe just more of a conceptual question around the differentiation of sell-through that you've seen in premium versus the lower end of the market, theoretically, we always kind of thought of the strong growth in composite decking is benefiting from both positive outdoor living trends as well as the conversion from wood to composites kind of giving a double positive tailwinds relative to the underlying R&R market.

好的。偉大的。也許更多的是圍繞高端市場與低端市場的銷售差異化的概念性問題，從理論上講，我們總是認為複合地板的強勁增長受益於積極的戶外活動生活趨勢以及從木材到複合材料的轉變相對於基礎的R&R 市場帶來了雙重積極的推動力。

What, in your view, has made the lower end kind of maybe grow more recently, at least in line with the underlying R&R market as opposed to not benefiting from some of those trends that maybe you're still seeing in the premium side?

在您看來，是什麼使得低端市場最近可能有所增長，至少與基礎的 R&R 市場一致，而不是沒有從您可能仍在高端市場看到的一些趨勢中受益？

The differentiation is primarily going to be off of the demographic of the more entry-level customers. So you're going to have a lower income demographic and in an environment where there's much higher inflation. That consumer is asking the question which repair and remodel projects do I want to do with my home. So that's definitely a key driver of it. I think really important to note also that composites are not losing share to wood.

差異化主要來自於入門級客戶的人口統計。因此，您將面臨收入較低的人口和通貨膨脹率較高的環境。這位消費者問的問題是我想對我的家進行哪些維修和改造項目。所以這絕對是它的關鍵驅動因素。我認為值得注意的是，複合材料的市場份額並沒有輸給木材。

Wood is declining at a higher rate than what we've seen our entry level decline. So we still see that there is underlying support that conversion is happening in the market. Again, we survey our partners in the marketplace so that we understand what's happening out there. But there is a general weakness at that entry level at this point. Fortunately, the premium customers are still quite strong.

木材的下降速度高於我們看到的入門級下降速度。因此，我們仍然看到市場正在發生轉換，這是有潛在的支持。我們再次調查市場上的合作夥伴，以便了解市場上正在發生的事情。但目前該入門級普遍存在弱點。幸運的是，優質客戶仍然相當強勁。

Okay. So that's very helpful. I mean basically, what sounds like you're saying, Bryan, is that maybe perhaps the overall decking market could even theoretically be worse than the broader R&R just given that it's a bigger purchase and a lot more discretionary. Is that kind of your implied?

好的。這非常有幫助。我的意思是，基本上，布萊恩，聽起來你所說的是，也許整個裝飾市場在理論上甚至可能比更廣泛的R&R 更糟糕，因為它是一個更大的購買和更多的自由裁量權。這是你的暗示嗎？

I did not say that.

我沒有這麼說。

Okay. I was just curious, it sounded like directionally there, but all right.

好的。我只是好奇，聽起來像是定向的，但沒關係。

Tim Woja, Baird.

提姆沃賈，貝爾德。

Maybe just on raw materials, some of the recycled indices that we look at, Bryan, have seen some inflation in some of the recycled polyethylene grades. Is that something -- and I can't really explain it. I mean, is that something that you're seeing in the marketplace you're seeing in COGS? Or any driver to what that might be?

也許只是在原料方面，布萊恩，我們觀察到的一些回收指數中，一些回收聚乙烯等級出現了一些通膨。這是什麼嗎——我無法真正解釋它。我的意思是，這是您在市場上看到的銷貨成本嗎？或者任何驅動程式可能是什麼？

Well, I'll start with -- I've never really seen a good index that covers the type of polyethylene that we use, the film coming from the marketplace. It's usually going to be on pelletized purchases. I would tell you with what we're out purchasing in the market, we continue to see very, very moderate levels of inflation with it, and it's not been a concern that we've had this year.

好吧，我首先要說的是——我從來沒有真正見過一個好的索引來涵蓋我們使用的聚乙烯類型，即來自市場的薄膜。通常是顆粒狀採購。我想告訴你，我們在市場上購買的東西，我們繼續看到非常非常溫和的通膨水平，而且今年我們沒有擔心過。

Okay. That's helpful. And then I guess just I want to -- I think you said two different numbers kind of through the call, I just want to make sure I get it right. So are you guys assuming that the R&R market next year is up mid-single digits or low single digits?

好的。這很有幫助。然後我想我只是想——我想你在電話中說了兩個不同的號碼，我只是想確保我的數字是正確的。那麼你們認為明年的 R&R 市場是中個位數成長還是低個位數成長？

Low single digits.

低個位數。

Phil Ng, Jefferies.

菲爾·吳，杰弗里斯。

Just a clarification to Susan's question earlier. Brian, are you saying there's no winter buy in 2025? Or just you're not going to see the outsized $40 million inventory to (inaudible)

只是對蘇珊之前的問題進行澄清。Brian，你是說 2025 年沒有冬季採購嗎？或者只是你不會看到價值 4000 萬美元的巨額庫存（聽不清楚）

Yeah, there will still be a prebuy. And given the seasonality of this industry, that's the reason seasonal companies do the early buy programs. And so that, that inventory is staged when the season really kicks off in the April time frame. And yeah, there will absolutely be a program that will be focused on January through March time frame.

是的，還是會有預購的。考慮到這個行業的季節性，這就是季節性公司實施早期購買計劃的原因。因此，當季節在四月真正開始時，該庫存就會上演。是的，絕對會有一個計劃集中在一月到三月的時間範圍內。

Okay. So just not as big as last year because last year, you had this big -- I mean this year, had a big bump. And I guess with Trex running structurally with more inventory, how should we think about the production levels and how you're going to run at 2025.

好的。所以只是不像去年那麼大，因為去年，你有這麼大——我的意思是今年，有一個很大的衝擊。我猜想，隨著 Trex 在結構上以更多庫存運行，我們應該如何考慮生產水準以及 2025 年將如何運行。

I know a few years ago, when you had too much inventory, you kind of managed inventory in a certain way, but it sounds like you may look at it a little differently. I just want to be thoughtful about that because your inventories are high. So is there any risk that you draw down production next year, which would be a headwind on margins?

我知道幾年前，當你有太多庫存時，你會以某種方式管理庫存，但聽起來你可能會以不同的方式看待它。我只是想考慮一下，因為你們的庫存很高。那麼明年是否有減產的風險，這會對利潤率產生不利影響？

Yeah. We're definitely looking at inventories differently than we did back in 2022, we really dropped production way off in 2022, then we had to bring quite a bit of that production back in early, and I guess it was mid '23 and then ran pretty heavily.

是的。我們對庫存的看法肯定與 2022 年不同，我們在 2022 年確實大幅減少了產量，然後我們不得不提前恢復相當多的產量，我猜那是 23 年中期，然後運行相當重。

So it's been a bit of an up and down from a production perspective. We want to get away from that. It doesn't make sense from a cost perspective, it doesn't make sense from an employment perspective. So that's where you'll see the additional inventory that we'll have. And I'm not too concerned from a utilization perspective, we can run more efficiently if we can run more on a more stable basis.

所以從生產的角度來看，這有點起起落落。我們想擺脫這種情況。從成本角度來看，這沒有意義，從就業角度來看，這沒有意義。因此，您將在此處看到我們擁有的額外庫存。從利用率的角度來看，我並不太關心，如果我們能夠在更穩定的基礎上運行更多，我們就能更有效率地運作。

Okay. That's helpful. And then the way I should interpret some of the comments you made on the Little Rock at least on the plastic recycling piece, is that roughly like a $5 million EBITDA impact and $50 million on earnings?

好的。這很有幫助。然後，我應該如何解釋您對小石城至少在塑膠回收方面發表的一些評論，這是否大致相當於 500 萬美元的 EBITDA 影響和 5000 萬美元的收益？

And I guess expanding that question, for 2025, are you effectively stripping out the $5 million load-in and the start-up cost from EBITDA and EPS? Because in the past, I think you generally kept it. So I just wanted to understand are you stripping it out going forward.

我想擴展這個問題，到 2025 年，您是否有效地從 EBITDA 和 EPS 中剔除 500 萬美元的加載和啟動成本？因為在過去，我想你通常會保留它。所以我只是想了解你是否會繼續將其剝離。

Yeah. So again, $5 million will be the pure start-up costs and then you'll have the depreciation, right, $10 million for just a little rock piece of it. But the $10 million in depreciation doesn't start until Q2. So we will only have three quarters of that depreciation so think of it from that perspective.

是的。再說一次，500 萬美元將是純粹的啟動成本，然後你就會有折舊，對吧，1000 萬美元只是其中的一小部分。但 1000 萬美元的折舊要到第二季才開始。所以我們只會有四分之三的折舊，所以從這個角度來考慮。

Yeah. So we'll give you adjusted numbers. We'll explain what those adjustments are.

是的。所以我們會給你調整後的數字。我們將解釋這些調整是什麼。

But the adjusted numbers will or will not include the start-up cost? I know you from perhaps a not...

但調整後的數字是否包括啟動成本？我認識你也許是從一個不...

They will not -- we will adjust out those start-up costs. Yes.

他們不會——我們將調整這些啟動成本。是的。

What about the D&A?

D&A 怎麼樣？

It's not going to be in your EBITDA.

它不會計入您的 EBITDA 中。

On earnings perspective. Are you shipping to...

從獲利角度來看。您要運送到...

We haven't decided how we'll report that next year as of yet. If it's more helpful to the market, we'll show it that way.

我們尚未決定明年如何報告這一情況。如果對市場更有幫助，我們就會這樣展示。

Jeffrey Stevenson, Loop Capital.

傑弗裡·史蒂文森，Loop Capital。

Today. I just had a clarification. I believe previously, you talked about in the fourth quarter, a high single-digit type sale decline. And just wondered was there any variance between your current down low single-digit expectations or any change in how inventories exit the year compared to previous expectations?

今天。我剛剛做了一個澄清。我相信之前，您談到了第四季度的高個位數銷售下降。只是想知道與之前的預期相比，您當前的低個位數預期或今年庫存退出方式是否有任何變化？

Yeah, it's a great question. We did have an assumption that there would be a high single-digit decline as we moved into the fourth quarter and that there would be continued deterioration. We didn't really see a continued deterioration in the third quarter. It came in as we expected.

是的，這是一個很好的問題。我們確實有一個假設，即進入第四季度時會出現較高的個位數下降，並且情況會持續惡化。我們並沒有真正看到第三季的情況持續惡化。它如我們所料。

I mentioned in the last call, July was pretty rough, but then we actually saw numbers improve a little bit in August and September. Now we expect that it will continue to see those kind of numbers through the end of the year. So instead of having a high digit high single-digit decline.

我在上次電話會議中提到，七月相當艱難，但後來我們實際上看到八月和九月的數字有所改善。現在我們預計到今年年底將繼續看到這樣的數字。因此，而不是出現高位數的高個位數下降。

It ends up being a low single-digit decline and a full year being flat. Where is that difference being serviced from? It is being serviced from the inventory in the channel where that channel inventory will be somewhat lower than what we had originally expected.

最終出現低個位數下降，全年持平。這種差異是從哪裡提供的？它是透過通路中的庫存來提供服務的，該通路庫存將略低於我們最初的預期。

And will that be similar to last year, which was 15% below historical levels? Or is it going to be lower than that?

這會與去年類似，比歷史水準低 15% 嗎？或者會比這個更低嗎？

It will be lower than last year.

將會低於去年。

Got it. And then my second question was just, Brian, on the importance of the naval exclusive railing announcement and the expectation of more with distribution partners. Is this being really driven by the new railing products that Trex has introduced over the last year or so? And then at a higher level, how much of railing sales at a distributor such as Snavely were Trex versus other brands in the past?

知道了。布萊恩，我的第二個問題是關於海軍獨家欄桿公告的重要性以及對分銷合作夥伴的更多期望。這真的是由 Trex 在過去一年左右推出的新欄桿產品所推動的嗎？然後從更高的層面來看，與過去的其他品牌相比，Trex 在 Snavely 等經銷商的欄桿銷售額中佔了多少？

Yeah, it's a great question. This is a strategy we've been pursuing for about two years now. You're starting to see the benefits of this strategy come through with the announcement from Snavely. And the way the strategy has worked is understanding what types of railings were our distributors selling, what were the volumes are selling? And what products did we need to have so that we could have those distributors just focused on the Trex brand.

是的，這是一個很好的問題。這是我們兩年來一直奉行的戰略。隨著 Snavely 的宣布，您開始看到這項策略的好處。這個策略的運作方式是了解我們的經銷商銷售什麼類型的欄桿，銷售量是多少？我們需要哪些產品才能讓這些經銷商專注於 Trex 品牌。

And now you're starting to see some of that come through. And as I mentioned, I expect you'll see further announcements as we move forward with that, all of the products I announced earlier. Those are the type of products that our distributors are looking for. And yeah, there is a material amount of sales that our distributors have had with additive products over the past years.

現在你開始看到其中一些已經實現。正如我所提到的，我希望隨著我們的推進，您會看到更多公告，即我之前宣布的所有產品。這些正是我們的經銷商正在尋找的產品類型。是的，過去幾年我們的經銷商在添加劑產品方面取得了很大的銷售量。

Kurt Yinger, D.A. Davidson.

庫爾特·英格，D.A.戴維森。

.I just wanted to follow up on the last question. Intuitively, it makes sense, more distribution coverage better I'm just curious like how we should think about that playing out at the retail level, right? I mean the contractor homeowner still picking the brand, how does more distribution kind of help ultimately pull that sale through in your mind?

.我只是想跟進最後一個問題。直觀上，這是有道理的，分銷覆蓋範圍越大越好，我只是很好奇我們應該如何考慮零售層面的情況，對吧？我的意思是承包商房主仍在選擇品牌，更多的分銷方式如何幫助您最終完成銷售？

Yeah. The first thing that will happen is you've got more feet on the street that are pitching your product, you've got availability at more locations. But in this industry, it generally takes three years to really gain share with these new products.

是的。首先發生的事情是，你有更多的人在街上推銷你的產品，你可以在更多的地方買到產品。但在這個行業，這些新產品一般需要三年的時間才能真正獲得份額。

First year, you have the infill second year, now you've got more turning through the channel and then by the third year is really where you start seeing that significant growth. We're excited that this potentially we could see more benefit earlier from that. but we also understand the channel that we work within.

第一年，你有填充的第二年，現在你透過管道獲得了更多的轉變，然後到了第三年，你真正開始看到顯著的成長。我們很高興能夠更早看到更多好處。但我們也了解我們工作的管道。

Our own sales team is highly engaged with conversion of these accounts as well as our distribution channel. We believe we'll have success both at the home center and within the Pro channel.

我們自己的銷售團隊高度參與這些客戶的轉換以及我們的分銷管道。我們相信我們將在家庭中心和專業頻道內取得成功。

Got it. Okay. I appreciate that. And then I thought it was interesting that you talked about adding the heat mitigating technology to some of the enhanced decking lines. Could you maybe just talk about kind of the cost implications surrounding that?

知道了。好的。我很欣賞這一點。然後我覺得很有趣的是，您談到了將散熱技術添加到一些增強地板線中。您能否談談與此相關的成本影響？

And how you think about kind of the opportunity across more of the portfolio, recognizing that it does seem like a higher-end feature and maybe there's kind of some cannibalization factor in the back year ahead. Just curious how you think about that.

以及您如何看待更多投資組合中的機會，認識到它確實看起來像是一個高端功能，並且可能在未來一年中存在某種蠶食因素。只是好奇你對此有何看法。

The advantage of having an ongoing continuous improvement program can allow you to add more value to your product. One of the questions I used to get a number of years ago was are we going to take prices back down now that we've taken all this price over those couple of years?

持續改進計劃的優勢可以讓您為產品增加更多價值。幾年前我經常遇到的問題之一是，既然我們已經在這幾年裡降低了所有價格，我們是否還要降低價格？

And the answer is no. I've not seen any pressure on price within the industry itself. But there's always going to be a drive to ensure that you're providing the best value to those consumers, especially with those entry-level products. And while they're not as strong right now, that market will come back, and we are in the right place to be able to capture that wood conversion marketplace as repair and remodel increases.

答案是否定的。我沒有看到行業內部有任何價格壓力。但始終會努力確保為這些消費者提供最佳價值，尤其是那些入門級產品。雖然它們現在還沒有那麼強大，但這個市場將會回來，隨著維修和改造的增加，我們正處於正確的位置，能夠佔領木材轉換市場。

Just to sneak one more in. Is it fair to think about kind of the innovation on the decking side being more kind of around just going forward or more kind of expanding the price points? How would you think about that?

就是為了再偷偷溜進去一個。認為裝飾方面的創新更多的是圍繞著前進還是更多的是擴大價格點是否公平？你對此有何看法？

We've got products that go anywhere from $2 a linear foot up to $9 to $10 a linear foot. So we've got a wide selection of decking various levels of aesthetics, various levels of performance with strong warranties. Will there be new deck boards coming to the market?

我們的產品價格從每英尺 2 美元到每英尺 9 美元到 10 美元不等。因此，我們有多種裝飾選擇，具有不同的美觀程度、不同的性能水平，並具有強有力的保證。市面上會有新的甲板嗎？

There absolutely will be. There will be new features and benefits, and there will also be new railing products that come to the marketplace. So I wouldn't say we're not at the endgame with either one of these product groupings.

絕對會有。將會有新的功能和優點，並且還會有新的欄桿產品進入市場。所以我不會說我們還沒有達到這些產品組合中的任何一個的最後階段。

Trevor Allinson, Wolfe Research.

特雷弗·阿林森，沃爾夫研究中心。

First question on railing, you talked about doubling your market share within five years. Is the 6% market share you called out referring to the entire $3.3 billion really market you referred to or just the parts of the market that you're operating in? And then is your expectation over the next five years that the railing market grows in line with the decking market?

關於欄桿的第一個問題，您談到在五年內將市場份額翻倍。您所說的 6% 的市場份額是指您所指的整個 33 億美元市場，還是您所經營的市場的一部分？那麼您對未來五年欄桿市場成長的預期是否與裝潢市場一致？

So that's going to be the entire railing market, $3.3 billion includes wood and any other alternative players. And so it's based off of those numbers. And we do expect the railing markets to go roughly in line with repair and remodel. It doesn't see quite the same growth that some of the projections are on the decking side of it.

這將是整個欄桿市場，33 億美元包括木材和任何其他替代品。所以它是基於這些數字的。我們確實預計欄桿市場將與維修和改造大致一致。它並沒有看到與一些預測在其甲板一側完全相同的增長。

You've got roughly 30% of Dex, don't get a railing at all because they're less than 36 inches in height, but there is a significant opportunity for Trex to be able to go after. We are the number two residential railing provider by market share at 6% of the marketplace. So that gives you a bit of an idea of just how fragmented this industry is.

你有大約 30% 的 Dex，根本沒有欄桿，因為它們的高度不到 36 英寸，但 Trex 有很大的機會去追趕。以市佔率計算，我們是第二大住宅欄桿供應商，市佔率 6%。因此，這讓您對這個行業的分散程度有一些了解。

Yeah, it makes sense. It sounds like a great opportunity. And then, Bryan, I wanted to follow up on a question -- or a comment you made just a few minutes ago about not seeing the incremental $40 million load in next year.

是的，這是有道理的。這聽起來是一個很好的機會。然後，Bryan，我想跟進一個問題，或者您幾分鐘前發表的關於明年不會增加 4000 萬美元負載的評論。

Is that comment due specifically to where your inventory is positioned currently as you build those levels up? Or is that more of a permanent change in how you're going to approach channel inventory levels moving forward to mitigate some of this boom and bust cycle that we've seen over the last couple of years.

該評論是否專門針對您在建立這些級別時當前的庫存位置？或者說，這更多的是如何處理渠道庫存水準的永久性改變，以緩解我們在過去幾年中看到的一些繁榮和蕭條週期。

Yeah, the latter of what you said, a little bit more of a permit change and try to reduce the chances for that boom and bust cycle exactly.

是的，你所說的後者，更多的是許可證變更，並試圖準確減少繁榮和蕭條週期的機會。

Adam Baumgarten, Zelman.

亞當·鮑姆加滕，澤爾曼。

Just on your 2025 outlook, you said R&R up low single digits. I would assume based on your history, you would grow higher than that. So just thinking about the 31% or above EBITDA margin, does that not include any assumption for volume leverage benefiting margins?

就您的 2025 年展望而言，您表示 R&R 成長了低個位數。根據你的歷史，我假設你會成長得更高。那麼，只要考慮 31% 或以上的 EBITDA 利潤率，這是否不包括任何銷售槓桿有利於利潤率的假設？

We even provided what that growth number is for next year. So let's not get too far ahead of ourselves. We will definitely provide more details on that.

我們甚至提供了明年的成長數字。所以我們不要太過超前。我們肯定會提供更多細節。

Okay. Got it. And then just on the whole dynamic premium versus entry-level sell-through kind of bifurcating here, have you ever seen it this disconnected in the past?

好的。知道了。然後，就整個動態溢價與入門級銷售的分歧而言，您過去見過這種脫節的情況嗎？

Well, I think what's changed is there are more products that are going after that wood conversion marketplace. So in 2019, we launched our enhanced product line. And it was specifically designed to go after that buyer who is installing wood and not just moving them to a product that's roughly 2 times the cost of wood, but show that consumer that for an extra couple of hundred dollars, they can afford to upgrade to our enhanced naturals product line, which settled for $275 a linear foot.

嗯，我認為發生的變化是有更多的產品正在爭奪木材轉換市場。因此，在 2019 年，我們推出了增強型產品線。它是專門為吸引正在安裝木材的買家而設計的，而不僅僅是將他們轉移到大約是木材成本兩倍的產品，而是向消費者表明，只要多花幾百美元，他們就有能力升級到我們的增強型天然產品系列的售價為每英尺 275 美元。

That strategy has worked extremely well. And the key part is educating these consumers that, yeah, for an extra $500 to $700, you can have a composite back, not just a wood deck that's going to deteriorate within 12 to 15 years.

這一策略非常有效。關鍵是要教育這些消費者，是的，只要多花 500 到 700 美元，你就可以擁有複合材料靠背，而不僅僅是會在 12 到 15 年內老化的木質甲板。

So the marketplace has changed over the past five years or so. So I think that's why you're seeing a bit of a difference in how the consumer is reacting when we enter into times of economic uncertainty.

因此，市場在過去五年左右的時間裡發生了變化。因此，我認為這就是為什麼當我們進入經濟不確定時期時，消費者的反應會有所不同。

Steven Ramsey, Thompson Research Group.

史蒂文·拉姆齊，湯普森研究小組。

To focus on the railing topic a bit more, could you put the sell-through of railing demand in some context with the decking divergence? I know it's a higher ramp up a low base, but if there's a way to help us gauge that?

為了更專注於欄桿主題，您能否將欄桿需求的銷售與裝飾差異放在一起？我知道這是一個從低基數上升到更高的斜坡，但是否有辦法幫助我們衡量這一點？

Yeah. We've not tried to do that as we, something we'll consider as we move forward with it. There's a lot of moving parts with railing right now with some of these new products coming to marketplace. And what I don't want to do is confuse sell-in of products with actual sell-through of products right now.

是的。我們並沒有嘗試這樣做，我們在推進過程中會考慮這一點。現在有許多帶有欄桿的移動部件，其中一些新產品即將上市。我現在不想做的是將產品的銷售與產品的實際銷售混為一談。

Okay. That's helpful. And thinking longer term on railing, is there a way to think about where the spectrum of products goes there on a premium versus entry level way of thinking about the railing portfolio.

好的。這很有幫助。從長遠角度考慮欄桿，是否有一種方法可以以高端與入門級的方式來思考產品範圍的走向，以考慮欄桿產品組合。

I see opportunities at every level. Even though we already have a strong lineup. And once these products are launched, we have a very complete lineup, much like the decking side of things, there will always be new opportunities for us to be able to go after.

我在各個層面都看到了機會。儘管我們已經擁有了強大的陣容。一旦這些產品推出，我們就有了非常完整的陣容，就像裝潢方面一樣，我們總會有新的機會去追求。

Matthew Bouley, Barclays.

馬修·博利，巴克萊銀行。

On the gross margin into the fourth quarter, I think you were implying something in the mid-20s and correct me if I'm wrong. And I know you're going to be keeping inventories higher. But kind of given where sell-through is exiting this year and where your inventory is, how should we think about your kind of early year production plans? And specifically, what I'm asking is what is the potential for that gross margin to kind of rebound beyond the fourth quarter?

關於第四季度的毛利率，我認為您暗示了 20 多歲的情況，如果我錯了，請糾正我。我知道你們的庫存將會維持在高水準。但考慮到今年的銷售情況以及你們的庫存情況，我們應該如何考慮你們年初的生產計畫？具體來說，我要問的是，毛利率在第四季之後反彈的潛力有多大？

Yeah. We tend to have our weakest gross margin in the fourth quarter anyway. So that really shouldn't be too much of a surprise for those that have lower sales as well as lower production with that. While we won't see saw our production like we've done over the past couple of years, there still will be some level of increase and decrease as we move into the seasonal part of the year.

是的。無論如何，我們的毛利率往往在第四季最弱。因此，對於那些銷售額和產量較低的公司來說，這確實不應該太令人意外。雖然我們不會像過去幾年那樣看到我們的產量，但隨著進入一年中的季節性部分，仍然會出現一定程度的增加和減少。

Okay. And then secondly, just not to harp on it, but just back on that 31% EBITDA margin. And presumably, there is a production estimate in there. I guess if you bear with me, you're saying your -- the $40 million channel fill is not going to repeat.

好的。其次，不要喋喋不休，而是回到 31% 的 EBITDA 利潤率。據推測，其中有產量估算。我想如果你耐心聽我說，你是說你的——4000 萬美元的頻道填充不會重複。

Obviously, sell-through is kind of still exiting the year down. And I guess you sounded like you're assuming revenues could be up mid-singles for the entire year. And so I guess the question is, is the assumption that you would see kind of accelerating revenue growth as you go through 2025. Or should it be kind of more ratably spread out between the first half and second half?

顯然，今年的銷售量仍在下降。我猜你聽起來像是在假設全年的收入可能會達到單打的中等水平。所以我想問題是，假設你會看到 2025 年營收成長加速。還是應該在上半場和下半場之間更分散？

I think repair and remodel right now is showing accelerating as we move through the external metrics for repair and remodel. And when we talk about that $40 million, it's not as if it doesn't sell in. What we're saying is that it doesn't sell in, in the first quarter. There's no reason to put that inventory out there in the first quarter. We expect the market will be there. It will sell in during Q2 and Q3.

我認為，隨著我們通過修復和改造的外部指標，修復和改造現在正在加速。當我們談論這 4000 萬美元時，它並不是賣不出去。我們要說的是，它在第​​一季度沒有賣出去。沒有理由在第一季把庫存放在那裡。我們預計市場將會存在。它將在第二季和第三季出售。

That concludes our question-and-answer session. I would like to turn the conference back over to Bryan Fairbanks for any closing remarks.

我們的問答環節到此結束。我想將會議轉回給布萊恩費爾班克斯（Bryan Fairbanks）發表閉幕詞。

Thank you for your participation and questions today. We look forward to speaking with many of you in the coming weeks and at upcoming conferences. Good evening.

感謝您今天的參與和提問。我們期待在未來幾週和即將召開的會議上與你們中的許多人交談。晚安.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。