Q1 2024 JELD-WEN Holding Inc Earnings Call

Dennis: Good morning, my name is Dennis, and I will be your conference operator today. At this time, I would like to welcome everyone to the Jeld-Wen First Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise.

Good morning, My name is Dennis and I will be your conference operator today at this time I would like to welcome everyone to the gelled wind first quarter 'twenty 'twenty four earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

Dennis: After the speaker's remarks, there will be a question and answer session. To ask a question, simply press star, then the number one on your telephone keypad. To withdraw your question, press star one again. I would now like to turn the conference over to James Armstrong, Vice President of Investor Relations. Please go ahead.

To ask a question simply press Star then the number one on your telephone keypad to withdraw your question Press Star one again.

I'd now like to turn the conference over to James Armstrong, Vice President of Investor Relations. Please go ahead.

James Armstrong: Thank you and good morning. We issued our first quarter 2024 earnings release last night and posted a slide presentation to the investor relations portion of our website, which can be found at investors.jeldwen.com. We will be referencing this presentation during our call. Today, I am joined by Bill Christensen, Chief Executive Officer, and Julie Albrecht, Chief Financial Officer.

James Armstrong: Thank you and good morning, we issued our first quarter 2024 earnings release last night and posted a slide presentation to the Investor relations portion of our website, which can be found at investors Dot <unk> dot com, we will be referencing this presentation during our call today I'm joined by Bill Christiansen.

Speaker Change: Executive Officer, and Julie Albrecht Chief Financial Officer, before I turn it over to Bill I'd like to remind everyone that during this call. We will make certain statements that constitute forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995. These statements are subject to a variety of risks and uncertainties, including those set.

James Armstrong: Before I turn it over to Bill, I'd like to remind everyone that during this call, we will make certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to a variety of risks and uncertainties, including those set forth in our earnings release and provided in our Forms 10-K and 10-Q filed with the SEC. Jeld-Wen does not undertake any duty to update forward-looking statements, including the guidance we are providing with respect to certain expectations for future results.

Speaker Change: Fourth in our earnings release and provided in our forms 10-K, and 10-Q filed with the SEC Gelled, one does not undertake any duty to update forward looking statements, including the guidance, we are providing with respect to certain expectations for future results. Additionally.

James Armstrong: Additionally, during today's call, we will discuss non-GAAP measures which we believe can be useful in evaluating our performance. However, the presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to their most directly comparable financial measures calculated under GAAP can be found in our earnings release and in the appendix to our earnings presentation. With that, I would now turn the call over to Bill.

Speaker Change: Additionally, during today's call, we will discuss non-GAAP measures, which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to their most directly comparable financial measures calculated under GAAP can be found in.

Speaker Change: Our earnings release and in the appendix to our earnings presentation with that I would like to now turn the call over to Bill.

William J. Christensen: Thank you, James, and thank you, everyone, for joining our call today. I'm pleased with the progress we're making on our transformation journey, and we continue to focus on strengthening Jeld-Wen's foundation. While there are various near-term market challenges, we remain confident that we can deliver improved future performance. Let me start by first thanking all of our associates for their continued commitment as we work together to meet our customers' expectations while also taking important actions to bolster our financial performance.

William J. Christensen: Thank you James and thank you everyone for joining our call today.

William J. Christensen: I am pleased with the progress, we're making on our transformation journey and we continue to focus on strengthening <unk> Foundation.

William J. Christensen: There are various near term market challenges, we remain confident that we can deliver improved future performance let.

William J. Christensen: Let me start by first thanking all of our associates for their continued commitment.

William J. Christensen: Work together.

William J. Christensen: To meet our customer's expectations, while also taking important actions to bolster our financial performance.

William J. Christensen: Additionally, I want to thank the new senior leaders that recently joined our team within their first hundred days. They have rolled up their sleeves to learn the business, visit our facilities, and quickly add value to our transformation journey. I know they will help us achieve the short and long-term goals we have for Jeld-Wen.

William J. Christensen: Additionally.

William J. Christensen: I want to thank the new senior leaders that recently joined our team.

William J. Christensen: Within their first 100 days.

William J. Christensen: They've rolled up their sleeves to learn the business visit our facilities and quickly add value to our transformation journey.

William J. Christensen: I know they will help us achieve the short and long term goals, we have for Jetblue.

William J. Christensen: Today, I will initially share a brief overview of our first quarter results and discuss some of the actions we've completed. I'll then hand it over to Julie to discuss our financial results in more detail, before returning to discuss future actions on our transformation journey, provide our updated 2024 financial guidance, and then take your questions.

William J. Christensen: Today I will initially share a brief overview of first quarter results and discuss some of the actions we've completed.

William J. Christensen: I'll, then hand, it over to Julie to discuss our financial results in more detail.

Julie C. Albrecht: Before returning to discuss future actions in our transformation journey provide.

Julie C. Albrecht: Provide our updated 2024 financial guidance and then take your questions.

Julie C. Albrecht: I'll begin with our first quarter highlights on slide four.

William J. Christensen: Despite the continuous challenging market environment, first quarter sales and EBITDA were in line with our expectations as the positive impact from our ongoing productivity actions helped mitigate the anticipated headwinds from soft demand in both North America and Europe. In early April, as part of our ongoing activities to streamline and simplify our manufacturing footprint, we announced the closure of two North American Windows facilities. While these were difficult decisions.

Julie C. Albrecht: Despite the continued challenging market environment first.

Julie C. Albrecht: First quarter sales and EBIT were in line with our expectations as the positive impact from our ongoing productivity actions helped mitigate the anticipated headwinds from soft demand in both North America and Europe.

Julie C. Albrecht: In early April as part of our ongoing activities to streamline and simplify our manufacturing footprint.

Julie C. Albrecht: We announced the closure of two North America Windows facilities.

Julie C. Albrecht: While these were difficult decisions.

William J. Christensen: It's critical that we continue taking the actions needed to improve Jeld-Wen's financial results. I'll talk more about one of these decisions in a few minutes. Turning to slide five.

Julie C. Albrecht: It is critical that we continue taking the actions needed to improve <unk> financial results.

Julie C. Albrecht: I'll talk more about one of these decisions in a few minutes.

Julie C. Albrecht: Turning to slide five.

William J. Christensen: We continue to make solid progress on our transformation journey, including actions to fix our foundation and focus on our people. During the first quarter, we took important steps to strengthen our culture. In January, we gathered 130 of our top leaders from around the globe to align our vision and goals for the year. We also discussed how we will work together to execute on our transformation actions, including both cost reductions and top-line growth initiatives.

Julie C. Albrecht: We continue to make solid progress on our transformation journey, including actions to fix our foundation.

Julie C. Albrecht: Focusing on our people.

Julie C. Albrecht: During the first quarter, we took important steps to strengthen our culture.

Julie C. Albrecht: In January we gathered 130 of our top leaders from around the globe.

Julie C. Albrecht: To align our vision and goals for the year.

Julie C. Albrecht: We also discuss how we will work together to execute on our transformation actions, including both cost reductions and top line growth initiatives.

William J. Christensen: We also began training more than 1,600 senior leaders about the skills and behaviors we expect, along with giving them the tools to succeed in building a values-based organization. Shifting to performance, during the first quarter, we maintained our focus on improving cost efficiency. As I just mentioned, we recently announced our decision to shut two facilities, our Vista, California Composite Windows Facility, and our Hawkins, Wisconsin Woodwindows Facility. These closures are part of our plan to simplify and streamline the business, with a focus on quality of sales and asset utilization. Together, the closure of these two facilities is expected to deliver at least $11 million of annual EBITDA savings.

Julie C. Albrecht: We also began training more than 1600 senior leaders about the skills and behaviors, we expect along with giving them the tools to succeed in building a values based organization.

Julie C. Albrecht: Shifting to performance.

Julie C. Albrecht: During the first quarter, we maintained our focus on improving cost efficiency.

Julie C. Albrecht: As I just mentioned.

Julie C. Albrecht: We recently announced our decision to shut two facilities.

Julie C. Albrecht: Our Vista, California composite Windows facility.

Julie C. Albrecht: And our Hopkins, Wisconsin Wood Windows facility.

Julie C. Albrecht: These closures are part of our plan to simplify and streamline the business.

With a focus on quality of sales and asset utilization.

Julie C. Albrecht: Together the closure of these two facilities is expected to deliver at least $11 million of annual EBITDA savings.

William J. Christensen: I'm also pleased that we are increasing our CapEx spending to enable and deliver on operational improvement. In the first quarter, our CapEx increased approximately $10 million year-over-year, with much of this additional capital funding projects that are part of our transformation journey. Examples include projects that help us use materials more efficiently and increase automation and production processes, all resulting in driving costs out of our business, while also improving quality. We continue to be in the early innings of our transformation journey.

Julie C. Albrecht: I'm also pleased that we are increasing our capex spending to enable and deliver on operational improvements.

Julie C. Albrecht: In the first quarter, our capex increased approximately $10 million year over year.

Julie C. Albrecht: With much of this additional capital funding projects that are part of our transformation journey.

Julie C. Albrecht: Examples include projects that help us use materials more efficiently.

Julie C. Albrecht: And increased automation and production processes.

Julie C. Albrecht: All resulting in driving costs out of our business, while also improving quality.

Julie C. Albrecht: We continue to be in the early innings of our transformation journey.

William J. Christensen: However, we are pleased with the progress. I am proud of our team for their continued hard work and dedication in making Jeld-Wen a stronger and more profitable company that we all know it can be. I'll now turn it over to Julie to discuss the financial results.

Julie C. Albrecht: However, we are pleased with the progress I am proud of our team for their continued hard work and dedication in making <unk>, a stronger and more profitable company that we all know it can be.

Julie C. Albrecht: Looking at slide 7, our first quarter revenues were $959 million, down 11% from the prior year. This decrease was driven by a reduction in our core revenues due mostly to expected market-driven volume declines in both North America and Europe. Our adjusted EBITDA was $69 million in the first quarter, down $10 million year over year and leading to an adjusted EBITDA margin of 7.2%. Our Q1 margin was just 10 basis points lower than the prior year's first quarter, showing how our productivity is helping to offset the impact from lower volume mix.

Julie C. Albrecht: I'll now turn it over to Julie to discuss the financial results.

Julie C. Albrecht: Thanks Bill.

Julie C. Albrecht: Looking at slide seven our first quarter revenues were $959 million down 11% from the prior year.

Julie C. Albrecht: This decrease was driven by a reduction in our core revenues due mostly to the expected market driven volume declines in both North America and Europe.

Julie C. Albrecht: Our adjusted EBITDA was $69 million in the first quarter down $10 million year over year, and leading to an adjusted EBITDA margin of seven 2%.

Julie C. Albrecht: Our Q1 margin was just 10 basis points lower than the prior year's first quarter, showing how our productivity is helping to offset the impact from lower volume mix.

Julie C. Albrecht: As you see on slide 8, our first quarter revenue decline was driven by a lower volume mix of 12%, with marginal positive impacts from price and foreign exchange translation. As we mentioned in our February earnings call, our first quarter volume mix in North America included an approximately $30 million headwind from an unusually high backlog a year in 2022 that increased our first quarter 2023 sales. Excluding this impact, our first quarter 2024 volume mix decline would have been approximately 9%.

Julie C. Albrecht: As you see on slide eight our first quarter revenue decline was driven by lower volume mix of 12% with marginal positive impacts from price and foreign exchange translation.

Julie C. Albrecht: As we mentioned in our February earnings call, our first quarter volume mix in North America included an approximately $30 million headwind from unusually high backlog at year end 2022 that increased our first quarter 2023 sales.

Julie C. Albrecht: Excluding this impact our first quarter 2020 for volume mix decline would have been approximately 9%.

Julie C. Albrecht: I'll provide additional comments about our North America and Europe market trends shortly. On slide 9, you see that our first quarter adjusted EBITDA decreased by $10 million year over year. However, despite significant volume mix headwinds, we generated solid profit contributions from improved productivity and also benefited from higher other income. Moving to our segment results on slide 10,

Julie C. Albrecht: To provide additional comments about our North America, and Europe market trends shortly.

Julie C. Albrecht: On slide nine you see that our first quarter adjusted EBITDA decreased by $10 million year over year.

Julie C. Albrecht: Despite significant volume mix headwinds, we generated solid profit contributions from improved productivity and also benefited from higher other income.

Julie C. Albrecht: Moving to our segment results on slide 10.

Julie C. Albrecht: In the first quarter, our North America segment generated $680 million in sales, which was a decline of 11% from year-ago levels. This was driven by a reduction in core revenues of 12% due to lower volume mix. Excluding the impact of the unique backlog in last year's first quarter, North America's volume mix decline would have been approximately seven percent. North America's adjusted EBITDA decreased to $61 million from $79 million in last year's first quarter, while margins fell 130 basis points to 9 percent.

Julie C. Albrecht: In the first quarter, our North America segment generated $680 million of sales, which was a decline of 11% from year ago levels.

Julie C. Albrecht: This was driven by a reduction in core revenues of 12% due to lower volume mix.

Julie C. Albrecht: Excluding the impact of the unique backlog in last year's first quarter, North America's volume mix decline would have been approximately 7%.

Julie C. Albrecht: North America's adjusted EBITDA decreased to $61 million from $79 million in last year's first quarter, while margins fell 130 basis points to 9%.

Julie C. Albrecht: This decline was due to the lower volume mix that I just mentioned. In Europe, we generated $279 million of revenue and $15 million in adjusted EBITDA in Q1. Core revenues decreased by 12% year-over-year, driven by a lower volume mix of 14%. Adjusted EBITDA declined by $3 million, leading to margins of 5.2%.

Julie C. Albrecht: This decline was due to the lower volume mix that I just mentioned.

Julie C. Albrecht: In Europe, we generated $279 million of revenue and $15 million and adjusted EBITDA in Q1.

Julie C. Albrecht: Core revenues decreased by 12% year over year, driven by lower volume mix of 14%.

Julie C. Albrecht: Adjusted EBITDA declined by $3 million, leading to margins of five 2%.

Julie C. Albrecht: The decremental impact from lower volume was mitigated by solid productivity improvements. Now turning to the Market Outlook on slide 11. I'll provide some high-level comments on our Market Outlook, then we'll cover additional details on slide 12, starting with North America.

Julie C. Albrecht: The decremental impact from lower volume was mitigated by solid productivity improvements.

Julie C. Albrecht: Now turning to the market outlook on slide 11.

Speaker Change: I'll provide some high level comments on our market outlook, then we will cover additional details on slide 12.

Julie C. Albrecht: Due mostly to continued uncertainty around U.S. interest rates, we now expect North American volumes to be down by mid-single digits in 2024 versus our previous forecast of a low single-digit decline. However, we anticipate that new single-family home construction will be higher by low single-digits. However, the outlook for repair and remodel activity remains challenging, and we currently expect R&R activity to be down by mid to high single digits. The European market continues to remain under pressure and is experiencing higher-than-anticipated demand weakness due to the ongoing macroeconomic and geopolitical challenges.

Speaker Change: Starting with North America.

Speaker Change: Due mostly to continued uncertainty around U S interest rates, we now expect North America volumes to be down by mid single digits in 2024 versus our previous forecast of a low single digit decline.

Speaker Change: We anticipate that new single family home construction will be higher by low single digits. However, the outlook for repair and remodel activity remains challenging and we currently expect R&R activity to be down by mid to high single digits.

Speaker Change: The European market continues to remain under pressure and is experiencing higher than anticipated demand weakness due to the ongoing macroeconomic and geopolitical challenges overall.

William J. Christensen: Overall, we anticipate volumes in the region to be down by low double digits versus our previous forecast of a high single-digit decline. Residential construction markets remain soft across Europe, and we continue to expect that these volumes will be down by high single digits. Additionally, commercial project volumes are slowing in Europe, and this demand is expected to decline by low double digits versus our previous outlook of mid-single digits. Given the changes in our market outlook since we updated you in February, I want to provide additional details on the current market dynamics. So turning to slide 12, I'll start with North America.

Speaker Change: Overall, we anticipate volumes in the region to be down by low double digits versus our previous forecast of a high single digit decline.

Speaker Change: Residential construction markets remained soft across Europe, and we continue to expect that these volumes will be down by high single digits.

Speaker Change: Additionally, commercial project volumes are slowing in Europe, and this demand is expected to decline by low double digits versus our previous outlook of mid single digits.

Speaker Change: Given the changes in our market outlook since we updated you in February I want to provide additional details on the current market dynamics.

Speaker Change: So turning to slide 12, I'll start with North America.

William J. Christensen: As many of you know, single-family housing starts are improving slightly year over year. With existing home sales still sluggish and little inventory in the market, buyers are turning to new construction to fill the gap. The largest builders are driving much of this improvement, with much of the demand coming from entry-level homes.

As many of you know single family housing starts are improving slightly year over year.

Speaker Change: With existing home sales still sluggish and little inventory in the market buyers. They are turning to new construction to fill the gap.

Speaker Change: The largest builders are driving much of this improvement with much of the demand coming from entry level homes.

William J. Christensen: While this is a positive for our doors business, we are underrepresented among the largest home builders in our windows business. As such, our North America business is not seeing as much lift from single-family construction as the overall market data would suggest. Our team is working on the opportunity to increase our window sales where there is potential growth with this market trend. Bill will describe a specific example of this in a few minutes.

Speaker Change: While this is a positive for our doors business, we are underrepresented with the largest homebuilders in our windows business.

Speaker Change: Such our North America business is not seeing as much lift from single family construction as the overall market data would suggest.

Speaker Change: Our team is working on the opportunity to increase our windows sales, where there is potential growth with this market trend.

Speaker Change: Bill will describe a specific example of this in a few minutes.

William J. Christensen: The repair and remodel market continues to be weak, and the softness is greater than we expected three months ago. A combination of slow real income growth and continued high mortgage rates is causing consumers to delay large projects. Finally, while our multifamily and Canada projects business is only around 10% of our North America sales, these markets are facing much sharper declines than we anticipated due to the uncertain interest rate outlook. We believe that we are doing better than the market overall, but we are seeing sales in these markets down by around 20 percent.

Speaker Change: The repair and remodel market continues to be weak and the softness is greater than we expected three months ago.

Speaker Change: A combination of slow real income growth and continued high mortgage rates is causing consumers to delay large projects.

Speaker Change: While our multifamily and Canada projects business is only around 10% of our North America sales. These markets are facing much sharper declines than we anticipated due to the uncertain interest rate outlook.

Speaker Change: We believe that we are doing better than the market overall, but we are seeing sales in these markets down by around 20%.

William J. Christensen: Turning to Europe, the market continues to be soft across all countries. Commercial construction activity remains weak, and the updated forecast now shows 10 to 15 percent declines in commercial projects, while permits are already trending down 12 percent year over year. Like in North America, European commercial construction activity is being delayed due to continued high interest rates. Residential housing also remains challenged, with housing starts down by high single digits, with weakness in almost every region.

Speaker Change: Turning to Europe, the market continues to be soft across all countries.

Speaker Change: Commercial construction activity remains weak and the updated forecast now shows 10% to 15% declines in commercial projects, while permits are already trending down 12% year over year.

Speaker Change: Like in North America European commercial construction activity is being delayed due to continued high interest rates.

Speaker Change: Residential housing also remains challenged with housing starts down by high single digits with weakness in almost every region.

William J. Christensen: I'll now turn it back to Bill to talk about our transformation journey.

Speaker Change: I'll now turn it back to bill to talk about our transformation journey.

William J. Christensen: Thanks Julie.

William J. Christensen: Staying consistent with what we have previously said, we are taking a two-pronged approach to improve Jeld-Wen. As we show on slide 14, our short-term focus remains on strengthening the foundation of our business. We continue to make progress on reducing our operating costs and improving our operational performance. However, we have a lot more work to do on getting the basics right, like quality and delivery.

William J. Christensen: Staying consistent with what we have previously said.

William J. Christensen: We are taking a two pronged approach to improve Charles one.

William J. Christensen: As we show on Slide 14, our short term focus remains on strengthening the foundation of our business.

William J. Christensen: We continue to make progress on reducing our operating costs and improving our operational performance.

William J. Christensen: However, we have a lot more work to do on getting the basics right like quality and delivery.

William J. Christensen: In addition to this short-term focus, we continue to assess opportunities to grow our business, and we commit to only investing where we have the right to win. While this review is ongoing, we do see opportunity for profitable organic growth across our current portfolio. This includes the premium, multifamily, and high-performance areas that we currently participate in, but can do more. Turning to slide 15.

William J. Christensen: In addition to this short term focus.

William J. Christensen: We continue to assess opportunities to grow our business.

William J. Christensen: And we commit to only invest where we have the right to win.

William J. Christensen: While this review is ongoing we do see opportunity for profitable organic growth across our current portfolio.

William J. Christensen: This includes the premium multifamily and high performance areas that we currently participate in but can do more.

William J. Christensen: Turning to slide 15.

William J. Christensen: My three focus areas continue to be people, performance, and strategy. Our transformation journey is currently focused on people and performance. As we spoke about last quarter, we are investing more in our culture, including training around important behaviors such as safety, continuous improvement, and accountability. We are then measuring our progress and closing the loop with feedback from our team. Shifting to performance, our numerous initiatives include a balanced focus on both growth and cost reduction actions.

William J. Christensen: <unk> three focus areas continue to be people performance and strategy.

William J. Christensen: Our transformation journey is currently focused on people and performance.

William J. Christensen: As we spoke about last quarter we.

William J. Christensen: We are investing more in our culture.

William J. Christensen: Including training around important behaviors such as safety.

William J. Christensen: Tenuous improvement and accountability.

William J. Christensen: We are then measuring our progress and closing the loop with feedback from our teams.

William J. Christensen: Shifting to performance our numerous initiatives include a balanced focus on both growth and cost reduction actions.

William J. Christensen: As I've mentioned before, we began with approximately 800 projects in the pipeline and have completed more than 300 projects today. Through our disciplined process, we continue to refresh our project funnel as we still have many opportunities to improve. Focus areas remain commercial excellence manufacturing network optimization, automation, and leveraging our scale to improve sourcing, among many other smaller initiatives across the organization. I would like to highlight a few specific examples on the following slides.

William J. Christensen: As I've mentioned before we began with approximately 800 projects in the pipeline and have completed more than 300 projects to date.

William J. Christensen: Through our disciplined process, we continue to refresh our project funnel as we still have many opportunities to improve.

William J. Christensen: Focus areas remain commercial excellence manufacturing network optimization automation.

William J. Christensen: Automation and leveraging our scale to improve sourcing among many other smaller initiatives across the organization.

William J. Christensen: I would like to highlight a few specific examples in the subsequent slides.

William J. Christensen: On slide 16, you see a growth project that our North America Windows team is working on. As Julie mentioned in her market update, our team identified an opportunity to address our underrepresentation in a growing part of single-family home construction. After meeting with the top builders throughout the country, we heard consistent themes.

Speaker Change: On Slide 16, you see a growth project at our North America Windows team is working on.

Speaker Change: As Julie mentioned in her market update our team identified an opportunity to address our underrepresentation in a growing part of single family home construction.

Speaker Change: After meeting with the top builders throughout the country, we heard consistent themes any shorter lead times higher service levels and less call backs from window installations.

William J. Christensen: To address this, we developed our Windows stock and service program. This project leverages things we do well in various parts of our Windows business and brings an offering to the traditional channel that meets their needs. We are starting small with this program, only targeting select regions with partners that understand the value that we are providing. And as such, our revenue and EBITDA projections remain modest.

Speaker Change: To address this we developed our windows stock and service program.

Speaker Change: This project Leverages things, we do well in various parts of our windows business and.

Speaker Change: And brings an offering through the traditional channel that meets their needs.

Speaker Change: We are starting small with this program only targeting select regions with partners that understand the value that we're providing.

Speaker Change: And as such our revenue and EBITDA projections remain modest.

William J. Christensen: However, we see significant potential to expand this program as we continue to focus on providing what our customers find valuable. Turning to slide 17, another example of our transformation journey, which I mentioned briefly at the beginning of the call, is the closure of our Vista, Calif., manufacturing facility and, along with it, the exit of our Oraline composite window business, despite significant efforts from our team. Oraline was not achieving our business plan objective.

Speaker Change: However, we see significant potential to expand this program as we continue to focus on providing what our customers find valuable.

Speaker Change: Turning to slide 17. Another example of our transformation journey, which I mentioned briefly at the beginning of the call is the closure of our Vista, California manufacturing facility.

Speaker Change: And along with it the exit of our or align composite window business.

Despite significant efforts from our teams.

Speaker Change: Your line was not achieving our business plan objectives.

William J. Christensen: Following a critical review of the product line, we did not see a reasonable path to get to an acceptable level of profitability. As a result, we are in the process of winding down the business. I expect the site closure to be completed by the end of this year. An important part of this process included doing a post-mortem review, so we can improve similar activities in the future.

Speaker Change: Following a critical review of the product line, we did not see a reasonable path to get to an acceptable level of profitability.

Speaker Change: As a result, we are in the process of winding down the business.

Speaker Change: I expect the site closure to be completed by the end of this year.

Speaker Change: An important part of this process, including doing a postmortem review.

Speaker Change: So we can improve similar activities in the future.

William J. Christensen: Finally, as part of our transformation journey, we're reviewing products and customers to identify opportunities to improve the quality of our sales, where margin profiles are well below expectations. While some of these decisions may have a negative impact on our near-term financial results, these are critical actions to increase future shareholder value. I now want to discuss our 2024 guidance.

Speaker Change: Finally, as part of our transformation journey, we're reviewing products and customers to identify opportunities to improve the quality of our sales were margin profiles are well below expectations.

Speaker Change: While some of these decisions may have a negative impact on our near term financial results. These are critical actions to increase future shareholder value.

Speaker Change: I now want to discuss our 2020 for guidance.

William J. Christensen: As you see on slide 19.. and mostly driven by weaker than expected macroeconomic conditions, we are lowering our revenue and adjusted EBITDA guidance for the year. Specifically, we are lowering our revenue guidance to between $3.9 and $4.1 billion, from 4.0 to 4.3 billion previously. Our core revenues are now expected to be down five to nine percent, versus our previous expectation of flat to down 7%. This change is underscored by three main facts. Continued high interest rates are leading to increasing project delays in both North America and Europe.

Speaker Change: As you see on slide 19.

Speaker Change: And mostly driven by weaker than expected macroeconomic conditions, we are lowering our revenue and adjusted EBITDA guidance for the year.

Speaker Change: Specifically, we are lowering our revenue guidance to between three 9% and $4 1 billion.

Speaker Change: From 4.0 to $4 3 billion previously.

Speaker Change: Our core revenues are now expected to be down 5% to 9%.

Speaker Change: Versus our previous expectation of flat to down 7%.

Speaker Change: This change is underscored by three main factors.

Speaker Change: Continued high interest rates, leading to increasing project delays in both North America and Europe.

William J. Christensen: A slower seasonal demand ramp-up in the second quarter, especially in our North America retail business. And finally, as part of our transformation journey, we are proactively evaluating our product mix and may give up certain short-term sales to drive higher long-term profitability. We are lowering our adjusted EBITDA guidance due to our updated revenue outlook. We now expect our 2024 adjusted EBITDA to be in the range of $340 to $380 million versus our previous range of $370 to $420 million.

Speaker Change: A slower seasonal demand ramp up in the second quarter, especially in our North America retail business.

Speaker Change: And finally as part of our transformation journey, we are proactively evaluating our product mix and may give up certain short term sales to drive higher long term profitability.

Speaker Change: We are lowering our adjusted EBITDA guidance due to our updated revenue outlook.

We now expect our 2024 adjusted EBITDA to be in the range of $340 million to $380 million.

Speaker Change: Our previous range of $370 million to $420 million.

William J. Christensen: Our updated EBITDA guidance reflects the impact of lower expected revenue at a 25-30% decremental rate. Thus, though we are reducing our revenue and adjusted EBITDA guidance. I'll highlight that the EBITDA margin of our new guidance midpoint is 9%, an improvement from 2023. This is a good example of how our continued focus on cost efficiency is mitigating the current market headwinds. I'd also like to provide some information about our expected second quarter sales and EBITDA, the largest driver of our updated full-year revenue guide, which is a lower seasonal demand ramp-up in Q2 than initially expected.

Speaker Change: Our updated EBITDA guidance reflects the impact of lower expected revenue at.

Speaker Change: Out of 25% to 30% decremental rate.

Speaker Change: Though we are reducing our revenue and adjusted EBITDA guidance.

Speaker Change: I'll highlight that the EBITDA margin of our new guidance midpoint is 9% an improvement from 2023.

Speaker Change: This is a good example of how our continued focus on cost efficiency is mitigating the current market headwinds.

Speaker Change: I'd also like to provide some information about our expected second quarter sales and EBITDA.

Speaker Change: The largest driver to our updated full year revenue guide.

Speaker Change: Is a lower seasonal demand ramp up in Q2 than initially expected.

William J. Christensen: Specifically, we were originally forecasting a sequential increase in Q2 sales of approximately 10%. A revised outlook now calls for a mid-single-digit sequential increase. In addition, our second quarter EBITDA will include one-time costs of approximately $10 million due to the closure of two North America window facilities that we announced in early April.

Speaker Change: Specifically, we were originally forecasting a sequential increase in Q2 sales of approximately 10%.

Speaker Change: Our revised outlook now calls for a mid single digit sequential increase.

In addition, our second quarter EBITDA will include onetime costs of approximately $10 million due.

Speaker Change: Due to the closure of two North America window facilities that we announced in early April.

William J. Christensen: Now back to our full year out. We continue to be on track for the $100 million of cost savings this year, which is a combination of approximately $50 million of carry-forward benefits from last year's actions and new initiatives that will be completed this year. As we look at the phasing of earnings this year, we continue to expect benefits from our cost savings actions and investments to ramp up throughout the year. Considering the timing of both our sales and productivity actions, we expect to deliver approximately 40% of our EBITDA in the first half of the year and the remainder in the second half.

Speaker Change: Now back to our full year outlook.

Speaker Change: We continue to be on track for the $100 million of cost savings. This year, which is a combination of approximately $50 million of carryforward benefits from last year's actions and new initiatives that will be completed this year.

Speaker Change: As we look at the phasing of earnings this year we.

Speaker Change: We continue to expect benefits from our cost savings actions and investments to ramp up throughout the year.

Speaker Change: Considering the timing of both our sales and productivity actions, we expect to deliver approximately 40% of our EBITDA in the first half of the year and the remainder in the second half.

William J. Christensen: On slide 20, you see our updated cash flow outlook for the year due to our lower sales and EBITDA expectations. We now expect that this year's operating cash flow will be approximately $325 million before we incur an estimated $100 million of non-repeating cash expenses to fund portions of our transformation journey. We expect our free cash flow to be approximately $50 to $75 million, which reflects both our strong commitment to investing in Jeld-Wen's future and our ability to self-fund these investments with operating cash flow. Now, let's turn to slide 21.

Speaker Change: On Slide 20, you see our updated cash flow outlook for the year due to our lower sales and EBITDA expectations. We now expect that this year's operating cash flow will be approximately $325 million before we incur an estimated $100 million of non <unk>.

Speaker Change: <unk> cash expenses to fund portions of our transformation journey.

Speaker Change: We expect our free cash flow to be approximately $50 million to $75 million, which reflects both our strong commitment to investing in <unk> future and our ability to self fund these investments with operating cash flows.

Speaker Change: Let's turn to slide 21.

William J. Christensen: Before I wrap up, I want to give a quick update on Tawanda. As noted in our 8K last week, we have filed a motion to vacate the court-ordered divestiture of our Tawanda operation in light of changed industry and market factors. We believe the divestiture of Tawanda is no longer warranted, and we are asking for relief from the initial ruling. We believe this motion is in the best interest of the company and our shareholders. But there are no assurances that the motion will be granted.

Speaker Change: Before I wrap up I want to give a quick update on to Wanda.

Speaker Change: As noted in our 8-K last week, we have filed a motion to vacate the court ordered divestiture of our to Wanda operations.

Speaker Change: In light of changed industry and market factors, we believe the divestiture of to Wanda is no longer warranted and we are asking for relief from the initial ruling.

Speaker Change: We believe this motion is in the best interest of the company and our shareholders.

But there are no assurances that the motion will be granted.

William J. Christensen: This is the only update we will provide at this point. Despite the difficult macroeconomic conditions that we are facing, we continue to make strong progress on our transformation journey, which will set Jeld-Wen up for success as the market improves. While our near-term demand outlook is challenged, our long-term view has not changed, and we believe the underlying fundamentals for North America and European housing remain very positive. We take our commitments seriously, and one of our commitments has been to provide transparency and clarity with our investors.

Speaker Change: This is the only update we will provide at this time.

Speaker Change: Despite the difficult macroeconomic conditions that we are facing we continue to make strong progress on our transformation journey, which will set gelled went up for success as the market improves.

Speaker Change: Our near term demand outlook is challenged our long term view has not changed.

Speaker Change: And we believe the underlying fundamentals for North America, and European housing remain very positive.

Speaker Change: We take our commitments seriously and one of our commitments has been transparency and clarity with our investors because of this we believe now is the right time to adjust our guidance based on the softer than anticipated market conditions I remain confident.

William J. Christensen: Because of this, we believe now is the right time to adjust our guidance based on the softer-than-anticipated market conditions. I remain confident and optimistic about the number of long-term value-creating opportunities available within our business. We appreciate your continued interest, and I'll now turn it over to James to move to Q&A.

Speaker Change: Confident and optimistic about the number of long term value, creating opportunities available within our business.

Speaker Change: We appreciate your continued interest and I'll now turn it over to James to move to Q&A.

James Armstrong: Thanks, Bill. Operator, we're now ready to begin the Q&A.

James Armstrong: Phil Operator, we're now ready to begin Q&A.

Dennis: At this time, I would like to remind everyone, in order to ask a question, simply press star, then the number one on your telephone keypad. Please limit yourselves to one question and one follow-up question. Your first question is from the line of Phil Ung with Jeffries. Please go ahead.

James Armstrong: At this time I would like to remind everyone in order to ask a question simply press Star then the number one on your telephone keypad. Please limit yourselves to one question and one follow up question.

James Armstrong: Your first question is from the line of Phil <unk> with Jefferies. Please go ahead.

Philip H. Ng: Hey guys, I guess my first question is this morning on your outlook where you're reducing your top line guidance even though it makes sense given the uncertain macro backdrop. But Bill, I think you called out, you know, less of a seasonal uplift, particularly in the retail channel. Can you impact that a little bit because I was under the impression perhaps even last quarter inventory levels were quite low already. And then just give us a little more context in terms of how we should think about some of the business that you pruned this year that might be a drag from a top line perspective, at least in the near term this year.

James Armstrong: Yes.

Philip H. Ng: I guess my first question guys.

Philip H. Ng: Good morning.

Philip H. Ng: Your outlook, where you are reducing.

Your topline guidance EBITDA makes sense, just given the uncertain macro backdrop.

Philip H. Ng: Bill I think you called out less of the seasonal uplift, particularly in the retail channel can you unpack that a little bit because I was under the impression and perhaps even last quarter inventory levels were quite low already and then just give us a little more context in terms of how we should think about some of the business that you prune this year.

Philip H. Ng: That might be a drag from a topline perspective.

Philip H. Ng: In the near term this year.

William J. Christensen: Sure, Phil. So clearly, we've called out the weaker R&R ramp-up in Q2 as a headwind that is larger than expected when we planned for the year. So that's the first message, and that's mainly U.S.-focused R&R business. If you look at inventories and our view on inventories, it's actually staying pretty neutral. So we don't see big swings. It's just a lower uptake across the market. So that's clearly based on our relatively large share in R&R, clearly a headwind. And I think we all know what the reasons are.

William J. Christensen: Sure Phil so on so clearly we've called out weaker R&R ramp up in Q2 as a headwind that is larger than expected when we planned for the year.

William J. Christensen: That's the first message and Thats, mainly U S focus R&R business.

William J. Christensen: If you look at inventories in our view on inventories is actually staying pretty neutral. So we don't see big swings.

William J. Christensen: A lower uptake.

William J. Christensen: Across the market. So thats clearly based on our relatively large share in R&R clearly a headwind and I think we all know what the reasons are consumer sentiment is still very guarded big ticket items are on hold there is interest rate uncertainty, it's an election year and Dan Dan.

William J. Christensen: Consumer sentiment is still very guarded. Big ticket items are on hold. There's interest rate uncertainty. It's an election year, and, and, and.

So I would say with that.

William J. Christensen: <unk>.

William J. Christensen: So I would say with that, that's the view, and that's why we're calling it down now, because we're not seeing the uplift. I would say on the pruning side, we are actively looking at the mix of our portfolio and the profit levels of that portfolio mix. And we've made some decisions specifically within our Windows business, for example, to really stop doing certain lines of business where we were not seeing the profit levels that were expected and that we would want longer term. So we've done away with some window business.

William J. Christensen: That's the view on that is why we're calling it down now because we're not seeing the uplink up lift I would say on the pruning side. We are actively looking at the mix of our portfolio and the profit levels of that portfolio mix and we've made some decisions specifically within our windows business for example to <unk>.

William J. Christensen: Really.

William J. Christensen: Stop doing certain lines of business, where we were not.

William J. Christensen: We were not seeing the profit levels that were expected and that we would want longer term. So we've done away with some window business and in addition to that.

William J. Christensen: And in addition to that, the reload of some of that window business that we had expected to backfill with other lines has not materialized. Some of that is a slow uptake on the R&R side, but just in general, we haven't completely met our expectations of backfilling some of the weaker business that we've pushed out. And so this has a pretty significant piece of the volume call down for the year as we look forward, Phil. So I think those are kind of the two big levers. R&R weaker, pruning in the Windows business, and we are looking at other areas as well, obviously to prune the portfolio, but that's specifically ongoing as.

William J. Christensen: Reload up some of that window business that we had expected to backfill with other lines has not materialized. Some of that is the slow uptake on the R&R side, but just in general we haven't completely met our expectations of back filling some of the weaker business that we've pushed out and so this has a pretty significant.

William J. Christensen: <unk>.

William J. Christensen: <unk> of the volume call down for the year as we look forward Phil. So I think those are kind of the two big levers R&R weaker pruning in the Windows business and we are looking at other areas as well, obviously to prune the portfolio, but thats, specifically ongoing as we speak.

William J. Christensen: Bill, any color in terms of how to size the printing dynamic for you guys this year?

Philip H. Ng: And any color on in terms of how to size the printing dynamic for you guys. This year.

William J. Christensen: Sure, you know, I would expect it's kind of between 50 and 100 million Topline Headwinds.

William J. Christensen: Sure.

Speaker Change: I would expect it's kind of between 50 and $100 million.

Speaker Change: Top line headwind.

William J. Christensen: What about from an EBITDA standpoint? Is it neutral to positive?

Speaker Change: What about from an EBITDA standpoint is it neutral to positive.

William J. Christensen: Well, there will be two dynamics there. Number one, it's a dilutive margin, so that would be positive. But obviously, we need to make sure that we can take the fixed costs out of the structure as we roll forward.

Speaker Change: Well theres going be two dynamics there number one it's a dilutive margin.

Speaker Change: So that would be positive, but obviously, we need to make sure that we can take the fixed costs out of the structure as we roll forward.

Julie C. Albrecht: Yeah, one more thing to add on the cost and the impact on EBITDA this year, and I think Bill mentioned this in his remarks, specific to the two window actions that we announced in early April. We do have about $10 million of one-time costs that will run through our adjusted EBITDA. They're related to various aspects of inventory, kind of write-downs and adjustments and that kind of thing. So that is specifically a headwind in the second quarter. That is a headwind to full-year EBITDA and Q2 EBITDA. And then, other than that, generally, these moves are accretive to our margins.

Speaker Change: One thing to add there.

Speaker Change: On the cost and the impact to EBITDA This year and I think Bill mentioned this in his remarks.

Speaker Change: Specific to the two windows actions that we announced in early April we do have about $10 million of one time costs that will run through our adjusted EBITDA as it related to various aspects of inventory.

Speaker Change: Write downs in adjustments in that kind of thing.

Speaker Change: That is specifically a headwind in the second quarter.

Speaker Change: That is a headwind to full year, EBITDA and Q2 EBITDA.

Speaker Change: And then other than that generally these leads are accretive to our margins.

Julie C. Albrecht: And Julie, on that $100 million, is that, since it's one-time in nature, are you stripping that out, and are you adjusting the EBITDA guide?

Speaker Change: And Julian that $100 million is that since it's onetime in nature or are you stripping that out in your adjusted EBITDA Guide.

Julie C. Albrecht: Yeah, it was $10 million of one-time costs in the second quarter that will be included in Adjusted EBITDA. So we do have other one-time costs related to those site closures as well as other types of restructuring that we're doing that we do adjust out of Adjusted Earnings, but particularly, just kind of per our policy and our internal governance, we have about $10 million of those one-time costs that are negative to Q2. That's one part of the call down of Q2 for the full year.

Julian: Okay. It was $10 million of Tim Dugan.

Julian: $10 million of one time costs in the second quarter will be included in adjusted EBITDA. So we do have other one time costs related to the site closures as well as other types of restructuring that were doing that we do adjust out of adjusted earnings but particularly.

Julian: Just kind of per our policy and our internal governance, we have about $10 million of those onetime costs that are negative to Q2, that's one part of the call down of Q2 and the full year. Okay. That's helpful and just one last one for me.

Philip H. Ng: Oh, wow. That's helpful. And just one last one for me.

Julian: The cost out.

Julian: Improving the foundation of the business encouraging to see that bill Youre reiterating the $100 million.

Philip H. Ng: On costs out and, you know, improving the foundation of the business, I'm encouraging to see that, Bill, you're reiterating the $100 million target, despite perhaps a weaker demand backdrop. Any risk on that, just given softer volumes, usually not a great thing for productivity savings? And then I noticed CapEx was reduced a little bit. Was that more timing-related, or are you throttling back on some growth initiatives? And just lastly, any opportunity to kind of pull forward some of these cost savings in a weaker demand environment? Yeah, so let me try.

Julian: Target, despite perhaps a weaker demand backdrop any risk on that just given softer volumes, usually not a great thing for productivity savings and then.

Julian: Notice Capex was reduced a little bit was that more timing related or youre throwing back on some growth initiatives and just lastly, any opportunity to kind of pull forward. Some of these cost savings.

Julian: And then weaker demand environment.

William J. Christensen: Yeah, so let me try and hit those, Phil. So I'd say that, you know, we are digesting significantly more CapEx than we have in the past. So the organization is getting used to scaling up our CapEx. So we're pushing as much through as we can. Let me put some numbers behind that, Phil, so you can understand kind of the magnitude.

Speaker Change: Yes, So let me try and hit those fill so I'd say that we are digesting significantly more capex than we have in the past. So the organization is getting used to scaling up our capex. So were pushing as much through as we can let me put some numbers behind that Phil. So you can understand kind of the magnitude we feel still high level of conviction on the 100.

William J. Christensen: We still feel a high level of conviction on the 100 million. We have about 300 projects that are already delivering benefits. So 100 that rolled from last year into this year, and 200 additional roughly this year that we've gotten to the goal line. Think about it 80-20.

Speaker Change: We have about 300 projects that are already delivering benefits.

Speaker Change: <unk> that rolled from last year into this year and 200 additional roughly this year that we've gotten to the goal line think about 80 20. So there are a lot of smaller projects in there, but our machine room is really getting effective at pushing these through and we still have more than 700 active projects. So as we.

William J. Christensen: So there are a lot of smaller projects in there, but our machine room is really getting effective at pushing these through. And we still have more than 700 active projects. So as we look forward, we still see a pretty robust pipeline of self-help initiatives. And clearly, some of it is replacing some of the sales that we're losing. We've talked about some of the initiatives that we're working on in the past, but a lot of these are still cleaning up the foundation and just really driving quality, safety, and delivery initiatives because there's still a lot of room to improve within our network.

Speaker Change: We look forward, we see still a pretty robust pipeline of self help initiatives and clearly some of it is replacing some of the sales that we're losing and we've talked about some of the initiatives that we're working on in the past, but a lot of these are still cleaning up the foundation and just really driving.

Speaker Change: Quality safety delivery initiatives, because theres still a lot of room to improve within our network. So we feel confident of the $100 million.

William J. Christensen: So we feel confident on the $100 million. There is a lot of work that has been ongoing. And as I said, the 300 projects at the goal line give us a high level of conviction that we're able to deliver on that. I think the call down on CapEx is our organization digesting. And we're going to be pushing hard on any acceleration options. But right now, we feel that it's more realistic based on what we're seeing, kind of tracking over the last three to six months. I appreciate all the color, guys. Thank you.

Speaker Change: A lot of work that has been ongoing and as I said the 300.

Speaker Change: Projects at the goal line give us a high level of conviction that we're able to deliver on that I think the called out on Capex.

Speaker Change: Our organization digesting.

Speaker Change: And we're going to be pushing hard on any acceleration options, but right now we feel thats more realistic based on what we're seeing kind of tracking over the last three to six months.

Speaker Change: Okay I appreciate all the color guys. Thank you.

Speaker Change: Welcome.

Susan Marie Maklari: Your next question is from the line of Susan Maklari with Goldman Sachs. Please go ahead.

Speaker Change: Your next question is from the line of Susan Mcclary with Goldman Sachs. Please go ahead.

Susan Marie Maklari: Thank you. Good morning, everyone. Hi Susan. Good morning, Susan. Good morning.

Susan Marie Maklari: Thank you good morning, everyone, Hey, good morning.

Julie C. Albrecht: I just want to go back to thinking about the cadence on the margin performance for this year. It does seem like you're expecting to gain some incremental momentum on the cost initiatives as we think about the back half versus the first half of the year. I guess you could just talk a bit about what drives that confidence, how you're thinking about those benefits coming through, and then any thoughts on the margin that we could see as an exit rate for this year? Any color there would be helpful. Thank you.

Susan Marie Maklari: I just wanted to go back to thinking about the cadence on the margin performance for this year. It does seem like youre expecting to gain some.

Susan Marie Maklari: Incremental momentum on the cost initiatives as we think about the back half versus the first half of the year. I guess can you just talk a bit about what drives that confidence how youre thinking about those benefits coming through and then.

Susan Marie Maklari: Thoughts on the margin that we could see as an exit rate for this year.

Speaker Change: Any color there would be helpful. Thank you.

Julie C. Albrecht: Yes, Susan, I'll start and then I'll hand off to Billy and add a little more color. But I guess first of all, you know, you know, our outlook for first half versus second half margins has shifted a little bit based on the new guidance and again updated from what we talked about in February. So kind of part of that is the fact that we had expected that our first half margins would be relatively flat year over year, and now we do expect that to be down slightly, kind of like by 100 basis points or so, again, that's like first half this year versus first half second year, and that is solely driven by this drop off in the second quarter, and again, just to reiterate that, that's a combination of slightly lower volumes in Q2, and that flows through as well as these one-time costs related to some of these windows, site closures, again, that's about $10 million, then in the back half of the year, we continue to expect margins to improve year over year by about 100 to 150 basis points, that gets us all to this about 9% for the year, so the back half is really driven by those better margins, really driven by better comps from a volume mix perspective, so we do expect second half sales to be down slightly year over year, but that's a better comp than the down kind of 10, 11% in the first half of this year, and then you layer in the timing of our productivity and cost savings, and that we expect to be kind of roughly 30, 70, first half, second half, so just as some of these projects from last year and new ones this year kind of continue to ramp up, we do expect more of that cost savings in the back half of the year, so it's really all those dynamics that impact the 40, 60 phasing of our EBITDA, and again, that ramp up improvement of margins in the back half of this year.

Speaker Change: Yes, he is and I'll start and then I'll hand off to Bill you can add a little more color, but I guess first of all.

William J. Christensen: Okay, that's a great color. Thank you. And then, you mentioned in your remarks the opportunity to perhaps gain some more exposure with the builders, especially maybe the big builders. Can you talk a bit more about some of those initiatives, how you think about, you know, gaining that momentum there, and how it could come together?

Speaker Change: Our outlook for first half versus second half margins has shifted a little bit based on the new guidance.

Speaker Change: Again updated from what we talked about in February so.

William J. Christensen: Part of that is the fact that we had expected.

William J. Christensen: That our first half margins will be relatively flat year over year and now we do expect that to be down slightly kind of thing.

William J. Christensen: 100 basis points or so again, that's like the first half this year versus first half second year and that is solely driven by this drop off in the second quarter.

William J. Christensen: And again just to reiterate that the combination of slightly lower volumes in Q2 and that flows through as well as these one time costs related to some of these windows site closures again, thats about $10 million than in the back half of the year, we continue to expect margins to improve.

William J. Christensen: Year over year by about 100 to 150 basis points that gives us all to this about 9% for the year to the back half is really driven by the better margin is really driven by better comps from a volume mix perspective. So we do expect second half sales to be down slightly year.

William J. Christensen: Per year, but thats, a better comp than the down kind of 10, 11% in the first half of this year and then you layer in the timing of our productivity and cost savings and that we expect to be kind of roughly 30, 71st half second half. So just as some of these projects from last year and new.

William J. Christensen: Once this year kind of continue to ramp up we do expect more of that cost savings in the back half of the year. So it's really all of those dynamics that impact.

William J. Christensen: The 40 60 phasing of our EBITDA and again that ramp up improvement of margins in the back half of this year.

Speaker Change: Okay that does.

Speaker Change: Great color. Thank you and then you mentioned also in your remarks, the opportunity to perhaps gain some some more exposure with the builders, especially maybe the big builders can you talk a bit more about some of those initiatives how you think about.

Speaker Change: Gaining that momentum in there and how it could come together.

William J. Christensen: Yes, sure, Susan. So if you look at where the market is moving, clearly it's on the lower end of new construction because people that need a house at that level have to buy a house. So there's, I would say, less interest rate sensitivity, even though rates are clearly a headwind. And as that area of the market starts to move, we're clearly seeing solid growth on interior doors, which you would expect, but we're definitely underrepresented on windows.

Speaker Change: Yes sure Susan So if you look at where the market is moving clearly it's on the lower end new construction because people that need a house at that level, we'll have to buy a house. So there's I would say less interest rate sensitivity, even though rates are clearly a headwind and as that as that area.

Speaker Change: The market starts to move we're clearly seeing solid growth on interior doors, which you would expect but we're definitely underrepresented on windows and one of the things that we're trying to do is really figure out if we're selling a door in through our partners. How can we also augment that with windows.

William J. Christensen: And one of the things that we're trying to do is really figure out if we're selling a door through our partners, how can we also augment that with windows? So, as I've said in my prepared remarks, we've been spending a lot of time with our customers really trying to figure out what are the problems that we can help them solve and how can we relate to that. We do have a pretty solid offering, I'd say, at the lower end of our window portfolio on the vinyl side, which is a pretty good fit for this segment.

Speaker Change: So as I've said in my prepared remarks, we've been spending a lot of time with our customers really trying to figure out what are the problems that we can help them solve and how can we relate to that we do have a pretty solid offering I'd say at the lower end of our window portfolio on the vinyl side, which is a pretty good.

Speaker Change: Fit for this segment.

William J. Christensen: And the white glove service is really allowing us to meet their demands, put a specific team internally to solve those problems, and really focus on delivering and pulling that through. This is going to take a while, obviously, until we're backed into the job, we're pulled through the channel, the start becomes far enough along that we're installing windows, so think six to nine months out. So we're well into next year before this has a pretty significant effect on starting rebalancing the doors and windows portfolio share in this.

Speaker Change: The White glove service is really allowing us to meet their demands put a specific team internally on solving those problems and really focus on delivering and pulling that through this is going to take a while obviously until we're back into the job were pulled through the channel to start become.

Speaker Change: <unk>.

Speaker Change: Far enough along that were installing windows. So think six to nine months out. So we're well into next year before this has a pretty significant effect to start rebalancing.

Speaker Change: Ores and the Windows portfolio share in this segment.

Susan Marie Maklari: Okay, thank you for the color and good luck with everything. Thank you, Susan.

Speaker Change: Okay. Thank you for the color and good luck with everything Thank you Sandra.

John Lovallo: Your next question is from the line of John Lovallo with UBS. Please go ahead.

Speaker Change: Your next question is from the line of John Lovallo with UBS. Please go ahead.

John Lovallo: Good morning, guys. Thanks for taking my questions. The first one is, can you break out the impact from volume versus mix in that 12% core revenue decline on a consolidated basis?

John Lovallo: Good morning, guys. Thanks for taking my questions. The first one is high.

John Lovallo: Hi can you break out the impact from volume versus mix in that 12% core revenue decline on a consolidated basis, and then any color from North America, and Europe would be helpful as well.

Julie C. Albrecht: And then any color from North America and Europe would be helpful as well.

Speaker Change: Yes, so I can maybe start on a high level.

Speaker Change: Clearly the headwind.

Speaker Change: If I assume op, John just remember, what we're saying price cost we want neutral.

Julie C. Albrecht: Yeah, so I can maybe start at a high level. So clearly, the headwind, maybe if I zoom out, John, just remember what we were saying, price, cost, we want neutral. And that's still our expectation for the full year. You know, price is challenged in certain areas, but we still feel that that's an appropriate guide. Being neutral, we were making progress in Europe in Q1. And obviously, there was a higher volume headwind there, I would say more balanced in North America, but we feel pretty comfortable, at least from a price cost, as to what we're doing in the market. On volume, I'll let Julie give you some additional color on that.

Speaker Change: And Thats still our expectation for the full year price is challenged in certain areas, but we still feel that thats, an appropriate guide being neutral we were making progress in Europe in Q1.

Speaker Change: And obviously there was a higher volume headwind there I'd say, it's more balanced in North America, but we feel pretty comfortable at least from a price cost as to what we're doing in the market and the volume I'll, let Julie gave you some additional color on that.

Julie C. Albrecht: Yeah, sure. That 12% volume mix decline was really maybe like 60-40 volume mix, and with most of that, call it mix headwind in North America, that's really an average selling price dynamic like we just talked about. So you think about the average selling price of an interior door, where we're having very strong unit volume growth, but the average price is lower than, let's say, our premium windows and windows overall. And so we are seeing a top-line mix decline, let's say, from some of that mix in North America, and very much less so in Europe.

Julie C. Albrecht: Yes, sure that that 12% volume mix decline was.

Julie C. Albrecht: Really maybe like 60, 40 volume mix and with most of that mix headwind in North America, that's really an average selling price dynamic like we just talked about so you think about the average selling price of an interior door, where we're having very strong unit volume growth.

Julie C. Albrecht: But the average selling prices lower than let's say our premium windows in windows overall, and so we are seeing a top line mix.

Julie C. Albrecht: Decrement, let's say from some of that mix in North America.

Julie C. Albrecht: And very much less so in Europe really in Europe, it's really all volume related but <unk>.

Julie C. Albrecht: Really, in Europe, it's really all volume-related, but definitely a top-line mix challenge with, you know, again, the product dynamics we've just been talking about in North America, but at the top level, that ends up being about... split like 60-40 unit volume versus mix.

Julie C. Albrecht: Definitely a top line mix challenge with <unk>.

Julie C. Albrecht: Product dynamics, we've just been talking about in North America, but that at the top level that ends up being about split like 60, 40 unit volume versus mix.

John Lovallo: That's helpful. And then, you know, maybe just following up on that, pricing in North America was negative here, a negative one. It sounds like that could be ASP-related. Now, was that a mix between exterior versus interior, some more interior doors, or is there anything else going on there, you know, within that mix equation?

Speaker Change: That's helpful. And then maybe just following up on that pricing in North America was negative here at negative one it sounds like that that could be a ASP related now was that a mix between exterior versus interior. Some more interior doors or was there anything else going on there within that mix equation.

William J. Christensen: Hey John, thanks for the question. We typically wouldn't dive into that kind of detail on pricing at a segment level. I'd just say, in general, if we kind of look forward, we're pleased with where price cost is. Clearly, there's some input cost on the factor side that we can't ignore. Labor inflation, benefits inflation, and that's clearly what we're working towards to offset through our productivity and our transformation initiatives. So I'd say it's still kind of price cost neutral for the year. That's what we see, but we wouldn't want to jump into any specific segment pricing details for obvious reasons. Okay, I appreciate it.

Speaker Change: Hey, John Thanks for the question, we typically wouldn't dive into that kind of detail on pricing at a segment level I'd just say in general if we kind of look forward.

Speaker Change: We're pleased with where price cost is clearly there are some input cost on the factor side that we can ignore labor inflation benefits inflation and Thats clearly, what we're working towards to offset through our productivity of our transformation initiatives. So I'd say, it's still kind of price cost neutral for the year.

Speaker Change: That's what we see but we wouldn't want to jump into any specific segment pricing details for obvious reasons. Okay.

John Lovallo: Okay, I appreciate it, guys.

Speaker Change: Okay I appreciate it guys alright, you're welcome.

Jeffrey Patrick Stevenson: Your next question is from the line of Jeffrey Stevenson with Loop. Please go ahead.

Speaker Change: Your next question is from the line of Jeffrey Stevenson with Loeb. Please go ahead.

William J. Christensen: Hey, thanks for taking my questions today. So, if you could provide any more color on how North America volumes trended throughout the quarter and whether volume declines accelerated as the quarter progressed from the challenging R&R demand fundamentals you cited today?

Jeffrey Stevenson: Hi, Thanks for taking my questions today.

Jeffrey Stevenson: So can you could you provide any more color on how north America volumes trended throughout the quarter and whether volume declines accelerated as the quarter progressed from challenging R&R demand fundamentals you cited to the.

William J. Christensen: Yes, so I would say if we just try and keep it at a macro level here, Jeffrey, as we said, the anticipated reload in Q2 has been a lot softer than expected. This is, I would call it, unusual, just because a lot of our retail partners look to load their inventory for a late spring and summer build season. We're not seeing that. I'd say that's the main difference as we look ahead

Jeffrey Stevenson: Yes.

Speaker Change: Let's say, if we just try and keep it at a macro level here Jeffrey as we said the anticipated reload in Q2 has been a lot softer than expected. This is I would call it unusual.

Jeffrey Stevenson: Just because a lot of our retail partners look to load their inventory for a late spring and summer build season, we're not seeing that I'd say, that's the main difference.

Jeffrey Stevenson: As we look out clearly the commercial projects are significantly weaker than we had initially anticipated but those are push outs typically are linked to interest rates that are staying high and project owners are waiting because they feel at.

William J. Christensen: Clearly, the commercial projects are significantly weaker than we had initially anticipated, but those are push-outs typically linked to interest rates that are staying high, and project owners are waiting because they feel, at least a lot of them feel, that they could wait and get better financing in the future on these projects. So, we're seeing significant delays. It's a smaller piece of our business, but it's still relevant if you combine kind of our multifamily, which is the VPI business that we've spoken about, and a lot of the stuff that we're doing in Canada, which is... project-related, that we kind of put into this bucket.

Jeffrey Stevenson: At least a lot of them feel that they could wait and get better financing in the future on these projects. So we're seeing significant delays. It's a smaller piece of our business still is relevant if you combine kind of our multifamily which is the VPI business that we've spoken about it a lot of stuff that we're doing in Canada, which is.

Jeffrey Stevenson: Project related that we kind of put into this bucket. So I would say in general it's the R&R business and the headwind that is significantly let's.

William J. Christensen: So I would say in general, it's the R&R business and the headwind that is significantly worse than expected, but outside of that, there's nothing unusual. And I think we'll just keep it at that level; it's probably more appropriate.

Jeffrey Stevenson: Say worse than expected, but outside of that there is there is nothing unusual.

Jeffrey Stevenson: And with.

Jeffrey Stevenson: But just keep it at that level, it's probably more appropriate.

Jeffrey Patrick Stevenson: We've heard that mid-end window and door categories are under the most pressure since the low end is benefiting from production builder growth, and the higher end, you know, construction activity is holding OK. Would you agree with that, Bill? And can you talk maybe more about your outlook for a good, better, and best product? Well, I would, yeah, I wouldn't.

Speaker Change: No definitely understood and then we've heard that Midland window and door categories are under the most pressure so low and is benefiting from production builder growth on the hiring construction activity is holding in okay.

Speaker Change: You agree with that Bill and could you talk maybe more about your outlook for good better and best products.

William J. Christensen: Well, yeah, I wouldn't necessarily confirm that the higher end is okay. I would say that we are also seeing headwinds at the higher end. If you think about wood windows, think about our La Cantina business, which is, you know, aluminum systems going into very high-end homes, there's clearly weakness. I would throw that in as kind of the project type of weakness we're seeing. So this is down double digits, even more in certain areas.

William J. Christensen: Well I wouldn't yes, I wouldn't I wouldn't necessarily confirmed at the higher end is okay.

William J. Christensen: I would say that we also are seeing headwinds at the higher end. If you think about wood windows do you think about our lack container business, which is aluminum systems going into very high end homes, there's clearly weakness I would throw that in as kind of the project type of weakness.

William J. Christensen: Seeing so this is down double digit.

William J. Christensen: Even more in certain areas. So clearly I'd say the high end is weak.

William J. Christensen: So clearly, I'd say the high end is weak. And if it's weak now, it's going to stay weak for a while until the market starts to recover, and product is being built in. Clearly, the low end is moving. We've talked about where mixing well on interior doors is underrepresented in our Windows business. So I'd say the high-end weak projects, also commercial, very weak, low-end moving, great growth on doors, challenged on Windows based on us being underrepresented.

William J. Christensen: And.

William J. Christensen: If it's weak now it's going to stay weak for a while until the starts recover and product is being built in clearly the low end is moving we've talked about we're mixing well on into your doors, we're underrepresented.

William J. Christensen: On our Windows business, So I'd say the high end weak projects also commercial very weak low end moving great growth on doors challenged on windows based on us being underrepresented in that segment.

Speaker Change: Understood. Thank you Youre welcome.

Steven Ramsey: Your next question comes from the line of Steven Ramsey with the Thompson Research Group.

William J. Christensen: Your next question comes from the line of Steven Ramsey with Thompson Research Group. Please go ahead.

Brian Biros: Hey, good morning. This is actually Brian Byers on for Steven. Thank you for taking the time. Hey, Brian. Morning. On the Outlook again, maybe. Can you touch a little bit more on maybe the...

William J. Christensen: Hey, Good morning. This is actually Brian Biros on for Steven Thank you for taking my Bryan Bryan.

Brian Biros: Good morning.

Brian Biros: On the outlook again, maybe just can you just.

Brian Biros: Such a little bit more on maybe the specific data points you see out there to adjust the guidance I know you talked a lot about it on this call, but I only asked because most of it really seems macro driven and has kind of been interesting to see which companies. This quarter are adjusting guidance or not when the impacts kind of see more broad based across the industry and not necessarily company specific.

Brian Biros: The next question is, what specific data points do you see out there to adjust the guidance? I know you've talked a lot about it on this call, but I only ask because most of it really seems macro-driven, and it's kind of been interesting to see which companies this quarter are adjusting guidance or not when the impacts kind of seem more broad-based across the industry and not necessarily company-specific. So just curious what you saw that said you need to adjust guidance when others might not.

Brian Biros: So just curious what you saw that that you need to adjust guidance when others might not have.

William J. Christensen: Yeah, so I would say it's not only macro. Let me just call your attention to our portfolio pruning, which we had called out. So there are two things.

Brian Biros: Yes, so I would say, it's not only macro let me just call your attention to our portfolio pruning, which we had called out. So there is two things number one we're stepping out of our or align composite window business, but we are also pruning additional lines within our windows portfolio, because we were unhappy with the level.

William J. Christensen: Number one, we're stepping out of our Auraline composite window business, but we are also pruning additional lines within our windows portfolio because we were unhappy with the level of profit that these areas were delivering. You roll that all up, call it between 50 and 100 million dollars in top line. So, that's the one bucket. I think macro, I would say, you know, we've talked a lot about the macro headwinds that exist. Clearly, we are, we have a pretty solid position in the R&R segment, which has not yet rebounded as we had expected in Q2, and that's what we already see.

Brian Biros: <unk> of profit that these areas, we're delivering you roll that all up call. It between 50 and $100 million of top line headwind this year.

Brian Biros: So thats the one bucket I think macro I would say.

Brian Biros: We've talked a lot about the macro headwinds that exist clearly we are.

Brian Biros: We have a pretty solid position in the R&R segment, which has not yet rebounded as we had expected in Q2 and Thats, what we already see so we want to make sure we're being as transparent as possible with the capital market.

William J. Christensen: So, we want to make sure we're being as transparent as possible with the capital market, and, you know, calling it as we see it. This is not going to be a straight line recovery. It's very choppy. I think everyone would agree with that in the market, but in addition, which I think is an important point, we're taking some sales out of our P&L because we don't like the quality, and clearly, we've got to adapt our cost structure, which we're already doing to it, but on the backside, when the rebound occurs, we'll have a much better package of product that we're selling into the market, and that's why we're making these decisions now, even though it's, calling off sales in a down environment.

Brian Biros: Calling it as we see it this is not going to be a straight line recovery. It's very choppy I think everyone would agree with that in the market, but in addition, which I think is an important point, we're taking some sales out of our P&L, because we don't like the quality and clearly we've got to adapt our cost structure, which we're already doing to it but on the back side when the re.

Brian Biros: You're bound occurs we will have a much better package of product that we're selling into the market and that's why we're making these decisions now even though it's a tough market to be.

Brian Biros: <unk> off sales in a down environment.

William J. Christensen: Yeah, not very helpful. Um, maybe thinking back when the recovery happens, maybe into 2025. I know it's a long way away, but a lot can happen until then. But just trying to think how some of the automation, other self-help margin improvement projects you guys have that will play out into 2025, if volumes do come back, kind of giving you the added tailwind of kind of volume leverage on top of the initiative's benefits on their own. I don't know if there are any thoughts there on how impactful that could be to margins on that outlook. Thank you. Yeah, you're welcome, Brian. So I think, number one...

Speaker Change: Got it Thats very helpful.

Speaker Change: Maybe thinking.

Speaker Change: Back when the recovery happens maybe into 'twenty five an outset part way away a lot can happen until then but just trying to think how some of the automation of the self help margin improvement projects. You guys have that will play out into 2025, if volumes do come back to kind of giving you. The added tailwind of kind of the volume leverage on top of the <unk>.

Brian Biros: Mission is benefits on their own.

Brian Biros: Any thoughts there on how impactful that could be to margins on that outlook. Thank you.

William J. Christensen: Yeah, you're welcome, Brian. So, I think, number one, that should be pretty significant because we're doing a couple of things. I mean, we're taking costs out of the structure, but we really feel that based on some of the changes that we're making, which include automation and some efficiency projects, we will be able to deliver at or above the expected volumes that we have in the next couple of years with the infrastructure that we will then have in place. So, there's a pretty significant upside.

Speaker Change: Yes, Youre welcome Brian So I think number one that should be pretty significant.

Speaker Change: Because we're doing a couple of things I mean, we're taking cost out of the structure, but we really feel that based on some of the changes that we're making which include automation and some efficiency projects, we will be able to deliver at or above.

Speaker Change: Of the expected volumes that we have in the next couple of years with the infrastructure that we will then have in place. So there is a pretty significant upside we're talking a lot about decremental margins based on the current macro reality, but you have flipped that around the upside in your talk.

William J. Christensen: We're talking a lot about decriminalized margins based on the current macro reality, but you flip that around on the upside, and you're talking 25 to 30 percent lift on additional sales, which will be pushing through the existing infrastructure. So, we really are moving towards that future state, again, with a focus on making sure we like the quality of sales that we have in our portfolio. We're making the tough decisions to adapt the cost structure but also to weed out the product portfolios that we don't like and that we need to take action on. And so, these things are kind of, I'd say, accumulating this year.

Speaker Change: 25% to 30% lift on additional sales, which will be pushing through the existing infrastructure. So we really are moving towards that future state again with a focus on making sure. We like the quality of sales that we have in our portfolio, we're making the tough decisions to adapt the cost structure, but also to weed out.

William J. Christensen: The product portfolios that we don't like.

Speaker Change: And that we need to take action on.

William J. Christensen: So these things are kind of I'd say accumulating in this year, if we talk about the projects in our pipeline as I referenced to Phil's question. We haven't still 700 initiatives that we're working through and a lot of these are really focused on making sure. The strength of the foundation for the recovery is very solid just.

William J. Christensen: If we talk about the projects in our pipeline, as I referenced to Phil's question, we still have 700 initiatives that we're working through, and a lot of these are really focused on making sure the strength of the foundation for the recovery is very solid. Just a view on recovery, clearly, our view is that things should get better in 25 in North America, and definitely, Europe is going to be challenged in 25. And I think that's a very high level based on how we see the market and where things are. It's going to be, I think, better in 25 for North America, but still challenged in Europe.

William J. Christensen: Our view on recovery clearly our view is that things should get better in 'twenty five in North America.

William J. Christensen: And definitely Europe.

William J. Christensen: Is going to be challenged in 'twenty five.

William J. Christensen: And I think thats that the very high level based on how we see the market and where things are it's going to be I think better than 25% for North America still challenged in Europe.

Speaker Change: Okay. Thank you very much.

William J. Christensen: Welcome.

Matthew Adrien Bouley: Once again, if you would like to ask a question, simply press star, then the number one on your telephone keypad. For further questions from the line of Matthew Bouley with Barclays, please go ahead.

William J. Christensen: Once again, if you would like to ask a question simply press Star then the number one on your telephone keypad.

Matthew Adrien Bouley: Your next question is from the line of Matthew Bouley with Barclays. Please go ahead.

Matthew Adrien Bouley: Good morning, everyone. Thanks for taking the questions. Sticking on the topic of pruning, you know, I guess. Is it realistic to think that, you know, the portfolio as it stands now is sort of the starting lineup that you want to go with? Or, you know, if we are in kind of a choppier end market backdrop for an extended period here, you know, is there potential that there could be additional to come as you sort of review all your product lines? Thank you. Yep.

Matthew Adrien Bouley: Good morning, everyone. Thanks for taking the questions.

Matthew Adrien Bouley: Sticking on the topic.

Matthew Adrien Bouley: Of the of the pruning.

Matthew Adrien Bouley: I guess.

Matthew Adrien Bouley: Is it is it realistic to think that the.

Matthew Adrien Bouley: Portfolio as it stands now is sort of the starting lineup that you want to go with or.

Matthew Adrien Bouley: We are in kind of a choppy or.

Matthew Adrien Bouley: And market backdrop for an extended period here.

Matthew Adrien Bouley: Is there potential that there could be additional to come as you sort of review all your product lines. Thank you.

William J. Christensen: Yeah, Matt. So thanks for the question. So we're definitely not in, what I'd call, a future state today. We still have work to do. And there are two things that we're looking at. Number one is assessing our cost to serve and making sure we're doing our homework so we're as efficient as we can be meeting our customers' needs around quality and delivery. But at the same time, we're also assessing the quality of that sales mix in today's cost-to-serve environment but also in the future.

Speaker Change: Yes. So thanks for the question. So we're definitely not at I would call a future state today, we still have work to do.

William J. Christensen: And there's two things that were looking at number one is were assessing our cost to serve and making sure. We're doing our homework. So we are as efficient as we can be.

William J. Christensen: Meeting, our customers' needs around quality and delivery, but at the same time. We're also assessing what is the quality of that sales mix in todays cost to serve environment, but also also in the future state and if we don't see a clear path to profit like with Aura line, we're going to be making the tough decisions and we're going to be stopped.

William J. Christensen: And if we don't see a clear path to profit, like with Oraline, we're going to be making the tough decisions, and we're going to be stopping this. And I think this is one of the things where the organization is starting to realize that accountability is critical. And if we set up a business plan, I would suggest that there is still an overconfidence in our culture at Jeld-Wen. We need to hold ourselves accountable.

William J. Christensen: And I think this is one of the things where the organization is starting to realize that the accountability is critical and if we set up a business plan and I would suggest that there still is an overconfidence in our culture at <unk>, we need to hold ourselves accountable and if we don't have a plan to correct assuming were missed.

William J. Christensen: And if we don't have a plan to correct, assuming we're missing, we need to get there, or we're going to make a tough decision. So, and I would suggest this is new for the organization. These are tough decisions, but required, based on us not delivering the results that we committed to. And this is, I think, a strong signal of where we want to take this organization and that we're willing to take our medicine in some of these areas where we really haven't delivered as we said we should have.

William J. Christensen: We need to get there or we're going to make the tough decisions. So and I would suggest this is new for the organization. These are these are tough decisions, but required based on us not delivering the results that we committed to.

William J. Christensen: And this is I think.

William J. Christensen: A strong signal of where we want to take this organization and that we're willing to take.

William J. Christensen: Our medicine on some of these areas, where we really haven't delivered as we said we should have and we want to make sure it's very visible Matt.

William J. Christensen: And we wanna make sure it's very visible, Matt, to the capital market, so everyone knows exactly what we're doing, why we're doing it. So we can kind of continue. I would suggest our view of being very open and transparent about what we need to do and calling ourselves out if we don't hit our target but making a tough decision.

William J. Christensen: To the capital markets, so everyone knows exactly what we're doing why we're doing it and.

William J. Christensen: So we can kind of continue.

William J. Christensen: I would suggest our view of being very open and transparent about what we need to do and he calling ourselves offsides, if we don't hit our targets, but making the tough decisions.

Matthew Adrien Bouley: Gotcha. Okay. Thanks for that, Bill. Second one.

Matt: Got you okay. Thanks for that Bill.

Matthew Adrien Bouley: Second one.

Julie C. Albrecht: On the topic of price-cost, I know you don't want to get into specifics on the individual product lines, but, you know, in terms of calling it neutral for the year, I mean, clearly, price was negative in North America in the first quarter. You mentioned you're still seeing inflation in several areas. So was price-cost positive in Q1, and is the expectation that it would kind of, you know, drift a little lower through the year, or just any kind of color on, you know, or any additional detail, I guess, on what would keep price-cost neutral given these moving pieces? Thank you.

Matthew Adrien Bouley: On the topic of price cost.

Julie C. Albrecht: I know you don't want to get into specifics on the individual product lines, but you know.

Julie C. Albrecht: In terms of calling it neutral for the year I mean, clearly price was negative in North America in the first quarter, you mentioned youre still seeing inflation in several areas.

Julie C. Albrecht: So it was price cost positive in Q1 and is the expectation that it would kind of drift a little lower through the year or just any kind of color on or any additional detail I guess on what would keep price cost neutral given these moving pieces. Thank you.

Julie C. Albrecht: Yeah, sure. Yeah, our price cost was just slightly negative in the first quarter, like two million dollars. So I think, you know, plus or minus a little bit, we'd call that neutral. So I'd say, generally speaking, and Bill's already mentioned, we clearly continue to see inflation specifically in areas like labor and benefits, really as we expected. And then, you know, it puts and takes around material costs and transportation, etc., in both of our regions.

Speaker Change: Yes sure.

Julie C. Albrecht: I'll take the cost was just slightly negative.

Julie C. Albrecht: First quarter like $2 million I think.

Julie C. Albrecht: Plus or minus a little bit we call that neutral so I'd say generally speaking and the bill has already mentioned.

Julie C. Albrecht: Clearly continue to see inflation, specifically in areas like labor and benefits really as we expected.

Julie C. Albrecht: Then again puts and takes around material cost and transportation et cetera, and those of our region. So again in this environment. Our goal is to be raising price appropriately to cover inflation in our costs and so I think like you see in the first quarter I mean, North America was slightly negative.

Julie C. Albrecht: So again, in this environment, our goal is to be raising prices appropriately to cover inflation and our costs. And so, you know, I think, like you see in the first quarter, North America was slightly negative, and Europe was slightly positive on the top line for price. Net-net, there was just a very minor negative impact year-over-year on EBITDA. And again, that's what we're really working towards as we move through the year.

Julie C. Albrecht: Europe was slightly positive on the top line for price net net.

Julie C. Albrecht: Just a very minor negative impact year over year to EBITDA and again, that's what we're really working towards as we move through the year.

Matthew Adrien Bouley: All right. Thanks, Julie. Thanks, Bill. Good luck. Thanks, Matt.

Speaker Change: Alright, Thanks, Julie Thanks, Bill Good luck thanks Pat.

Michael Glaser Dahl: Your next question is from the line of Mike Dahl with RBC Capital Markets. Please go ahead.

Matthew Adrien Bouley: Your next question is from the line of Mike Dahl with RBC capital markets. Please go ahead.

Michael Glaser Dahl: Good morning. Thanks for taking my questions. I wanted to ask about the implied second half sales. I think you characterized it, and the guide would suggest that sales would be down slightly year-on-year. I think the pruning... that you've articulated alone might account for like a 2% year-on-year headwind, which would make the organic X pruning more likely. Blatt.

Michael Glaser Dahl: Alright, thanks for taking my questions.

Michael Glaser Dahl: Bill wanted to ask about the implied second half sales I think you characterized it in the guide would suggest that sales would be down slightly year on year.

Michael Glaser Dahl: Pruning.

Michael Glaser Dahl: That you've articulated alone might account for like a 2% year on year headwind, which will put the organic ex pruning more like.

Julie C. Albrecht: Is that a fair characterization? And I know comps get easier, but that does seem to imply some market improvement in the second half, which maybe is less visible today. Maybe I could elaborate on that.

Michael Glaser Dahl: Flat is that a fair characterization and I know comps get easier, but that does seem to imply some.

Julie C. Albrecht: A market improvement in the second half, which maybe is less visible today, maybe just elaborate on that.

Julie C. Albrecht: Yeah, sure. And you're right about the pruning being, you know, kind of in that 1.5% to 2% range as we've kind of moved on a full year basis. You know, I think, you know, basically with the reset of our second quarter sales, like we've been mentioning, and then you think about the seasonal ramp-up from there, Q3, and then what we expect for Q4, it all kind of nets into this, you know, slightly lower year-over-year outlook for the second half.

Blatt: Yes, sure and you are right about the training being kind of in that one 5% to 2% range as we've kind of neutral on a full year basis.

Julie C. Albrecht: Basically with the reset of our second quarter sales like we have been mentioning and then you think about the seasonal ramp up from there Q3, and then what we expect for Q4.

Julie C. Albrecht: It all kind of nets into this.

Julie C. Albrecht: Kind of now slightly lower year over year outlook for the second half.

Julie C. Albrecht: We did, and I think you may have just mentioned this, we did have a slightly easier comp when we look at the second half of last year, but it's, it's, you know, that's, you know, kind of, I'd say, nominal from a comp perspective. So, you know, we do expect, you know, a slight improvement in two-half sales this year over the first half, but again, it's all, you know, nothing too dramatic.

Julie C. Albrecht: Hey did I think you may have just mentioned is we did have a this is a slightly easier comp when you look at the second half of last year, but it's very.

Julie C. Albrecht: Kind of theory as a nominal from us from a comp perspective, so we do expect.

Julie C. Albrecht: <unk>.

Julie C. Albrecht: A slight improvement to have sales this year over first half but.

Julie C. Albrecht: Again, it's all it's nothing.

Julie C. Albrecht: Nothing nothing too dramatic there.

Michael Glaser Dahl: Got it. Okay. Thanks. And then my second question, just on... or Align specifically.

Speaker Change: Got it okay.

Speaker Change: And then my second question just on.

Michael Glaser Dahl: <unk>, specifically and I appreciate that this was an initiative that started under a prior management team, but it's pretty new I mean, the ramp the full ramp was really just in 'twenty. One again at the time it was touted as a pretty big growth opportunity.

Michael Glaser Dahl: And I appreciate that this was an initiative that started under a previous management team, but it's pretty new. I mean, the ramp-up, the full ramp-up was really just in 2020, and at the time, it was touted as a pretty big growth opportunity over time. So, you know, kind of short of four years later, shutting it down is notable. So, Bill, I know you probably still have work to do on the post-mortem, but can you give us just maybe a little more insight on, like, what specifically happened? Did the market shift in terms of... materials? Did you just not get the traction with certain sales channels? Can you dive a little deeper into what really went wrong that ultimately led to this decision?

Michael Glaser Dahl: Overtime, so kind of short of four years later shutting it down.

Michael Glaser Dahl: It is notable so bill I know, you're probably still have work to do on the postmortem, but can you give us just maybe a little more insight on what specifically happened if the market shift in terms of <unk>.

Bill: Materials did you just not get the traction with certain sales channels can you dive a little deeper into what really win.

Bill: Wrong that ultimately led to this decision.

William J. Christensen: Sure. So a couple of things. The project had had a number of delays internally. So it had been kind of born a long time ago and was moving forward, but at different rates of speed.

Michael Glaser Dahl: Sure.

Bill: So a couple of things.

Bill: The project had had a number of delays.

William J. Christensen: Internally.

William J. Christensen: So it had been kind of born a long time ago and was moving through but at different rates of speed. When we entered the market clearly there was an expectation that we'd be able to gain share in a segment that exists.

William J. Christensen: When we entered the market, clearly, there was an expectation that we'd be able to gain share in a segment that exists but is well managed by competitors of ours, and our traction in the sales channel was below our expectations, which led obviously to lower volume growth, and that led to business case red flags coming up. We also had some pretty significant input cost increases. As we progressed through, let's say, our maturity curve, and so we had lower volume, higher input costs, and that created a pretty significant challenge to make the business case work.

William J. Christensen: But it is well managed by competitors of ours.

William J. Christensen: And our traction in the sales channel was below our expectations, which led obviously to load volume growth and that led to business case Red flags coming up we also had some pretty significant input cost increases as.

William J. Christensen: As we progressed through I'd say, our maturity curve and so we had lower volume higher input costs and that created.

William J. Christensen: Pretty significant challenge to make the business case work.

William J. Christensen: And this is one of those things where, you know, we're still obviously reviewing it. But, as I said, it's pretty easy to see if this can get to the goal line or not. And clearly, our decision was that we weren't going to get there. And we need to redirect capital and resources to the other 700 projects that are creating significant value within our portfolio.

Speaker Change: And this is one of those things, where we're still obviously reviewing it but as I said.

William J. Christensen: It's pretty easy to see if this can get to the goal line or not and clearly our decision was we're not going to get there and we need to redirect capital and resources to the other 700 projects that are creating significant value within our portfolio. So.

William J. Christensen: So this is, I think, a tough, well, it is a tough decision, but I would consider it good news for the culture that we're trying to create at Jeld-Wen, which is holding ourselves accountable and making decisions. Thank you. You're welcome, Mike. Have a good day.

William J. Christensen: This is I think a tough well it is a tough decision, but I would reflect the good news for the culture that we're trying to create a children, which is holding ourselves accountable and making decisions.

William J. Christensen: Okay.

William J. Christensen: Thank you.

William J. Christensen: Youre welcome Mike have a good day.

James Armstrong: This concludes the question-and-answer session of today's call. I will now turn the call back to James Armstrong for any closing remarks.

William J. Christensen: This concludes the question to the answer session of today's call I will now turn the call back to James Armstrong for any closing remarks.

James Armstrong: Thank you all for joining our call today. If you have any questions, please reach out, and I'll be happy to answer. This ends our call, and I hope you have a great day.

James Armstrong: Thank you all for joining our call today, if you have any questions. Please reach out now happy to answer this ends our call and please have a great day.

Operator: This concludes the Jeld-Wen First Quarter 2024 Earnings Conference Call. Thank you for joining us. You may now disconnect.

Speaker Change: This concludes the gelled wind first quarter 2024 earnings conference call. Thank you for joining you may now disconnect.

Operator: Please wait; the conference will begin shortly.

Speaker Change: Please wait the conference will begin shortly.

Operator: Sure.

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