Q2 2025 JELD-WEN Holding Inc Earnings Call

Samantha Stoddard: Thank you for standing by. My name is Kate, and I will be your conference operator today. At this time, I would like to welcome everyone to JELD-WEN Holding Inc.'s second quarter 2025 results. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to James Armstrong, Vice President of Investor Relations. Please go ahead.

Thank you for standing by. My name is Kate, and I will be your conference operator. Today, at this time, I would like to welcome everyone to Jeld-Wen's second quarter 2025 results.

Online have been placed on mute to prevent any background noise.

After the speaker is remarks, there will be a question and answer session.

If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad.

If you would like to redraw your question, press star 1 again, thank you. I would now like to turn the call over to James VP of investor relations. Please go ahead

James Armstrong: Thank you, and good morning. We issued our second quarter 2025 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 William Christensen, Chief Executive Officer, and Samantha Stoddard, Chief Financial Officer. Before I turn it over to Bill, I would 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 Holding Inc.

Thank you, and good morning. We issued our second quarter 2025 earnings release last night and posted a slide presentation to the investor relations portion of our website, which can be found at investors.gov. We will be referencing this presentation during our call.

Sir.

Before I turn it over to Bill I would 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.

James Armstrong: 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, 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 our earnings release and in the appendix to our earnings presentation. With that, I would like to now turn the call over to Bill.

These statements are subject to a variety of risks and certainties including those set forth in our earnings, release and provided in our forms, 10K, and 10 Q filed with the SEC.

Children do not undertake any duty to update forward-looking statements, including the guidance we are providing with respect to certain expectations for future results.

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 our earnings release and in the appendix, to our earnings presentation.

William Christensen: Thank you, James, and good morning, everyone. Before we begin, I want to start by thanking our entire team for their continued commitment and focus. We know the environment remains difficult; however, the dedication across the organization continues to impress me. I am especially proud to report that our safety performance continues to improve in both regions, and that is something every employee played a key role in driving. The second quarter was about disciplined execution and staying focused on what we can control. We delivered results at the high end of our internal expectations. That reflects cost discipline and the ability of our teams to effectively adapt to a complex and shifting landscape. While volumes remain soft, they came in largely as expected, and we acted with urgency to better balance our cost base. Operationally, we made important progress on several fronts.

with that, I would like to now turn the call over to Bill

Thank you, James, and good morning, everyone.

Before we begin, I want to start by thanking our entire team for their continued commitment and focus.

We know the environment remains difficult.

However, the dedication across the organization continues to impress me, I'm especially proud to report that our safety performance continues to improve in both regions and that is something every employee played a key role in driving.

The second quarter was about disciplined execution and staying focused on what we can control. We delivered results at the high end of our internal expectations.

That reflects cost discipline and the ability of our teams to effectively adapt to a complex and shifting landscape.

While volumes remain soft. They came in largely as expected and we acted with urgency to better balance our cost base.

Operationally.

William Christensen: We continue to see tangible benefits from our transformation and cost actions, particularly in fixed cost reductions. At the same time, we continue to make foundational progress across our North America operating network. We have replaced a number of key roles combined with clear actions, problem solving, and accountability at the site level. Our key priority remains improving service levels across our network. We are also reinstating full-year guidance. This is not because the environment has become more predictable, but due to the fact that we are now far enough into the year to have a higher degree of visibility. Our guidance reflects expectations based on what we know today, including the continued transformation progress, the August 1st tariff reality, and our sustained cost focus. While we do not know when the macro environment will get better, we do know that it will.

We made important progress on several fronts.

We continue to see tangible benefits from our transformation and cost actions.

Particularly in fixed cost, reductions.

At the same time we continue to make foundational progress across our North America. Operating Network

We have replaced a number of key roles combined with clear actions problem solving and accountability at the site level.

Our key priority remains improving service levels across our Network.

We are also reinstating full year guidance.

This is not because the environment has become more predictable. But due to the fact that we are now far enough into the year to have a higher degree of visibility

Our guidance reflects expectations based on what we know today, including the continued transformation progress.

The August 1st, tariff reality.

And our sustained cost Focus.

William Christensen: Housing remains a fundamental need, and homeowners continue to invest in improving the spaces where they live. We continue taking the right actions to position the company for long-term success and creating significant opportunity when the market recovers. Turning now to slide four and our second quarter highlights. Demand remains soft in the quarter; however, we began to bank the benefits of actions we have taken. Volume pressures persisted across all of our product categories and end markets, and we are also beginning to see selective price pressures. However, adjusted EBITDA was in line with the high end of our internal expectations as we took required cost actions in the continuing soft demand environment. During the quarter, we took further footprint actions to improve our operations.

While we do not know when the macro environment will get better, we do know that it will.

Housing remains a fundamental need.

And homeowners continue to invest in improving the spaces where they live.

We continue taking the right actions to position the company for long-term success.

And creating significant opportunity when the market recovers.

Turning now to slide 4 and our second quarter highlights.

Demand remains soft in the quarter.

However, we began to bank the benefits of actions we have taken.

Volume pressures, persisted across all of our product categories and end markets.

And we are also beginning to see selective price pressures.

However adjusted ebit da was in line with the high-end of our internal expectations. As we took required cost actions in the continuing soft demand environment.

William Christensen: We transitioned our facility in Capell, Texas, into a raw materials warehouse, which reduced overall costs and enables us to streamline our internal supply chain. We completed the closure and prep for repurposing of our windows facility in Grinnell, Iowa, including equipment transfers, building clean-out, and inventory sell-down. In addition, we announced the planned closure of our facility in Chilicouin, Oregon. We still remain cautious for the remainder of the year as interest rates remain elevated and affordability challenges continue, but are reinstating full-year guidance, which I will discuss later in the call. However, as Samantha will detail shortly, even with recent short-term actions, we have faced ongoing productivity headwinds from significantly lower demand levels. While we continue to take action to align our operations with current order rates, we are actively pursuing additional opportunities to strengthen our partnerships with key customers in support of focused growth initiatives.

During the quarter, we took further footprint, actions to improve our operations.

We transitioned our facility and compelled Texas into a raw materials Warehouse.

Which reduced overall costs and enables us to streamline our internal supply chain.

We completed the closure and prep for repurposing of our Windows facility. In Grinnell Iowa, including equipment transfers building, clean out and inventory sell down.

In addition, we announced the planned closure of our facility in Chiloquin Oregon.

We still remain cautious for the remainder of the year as interest rates remain elevated and affordability challenges continue, but our reinstating full year guidance, which I will discuss later in the call.

Even with recent short-term actions, we have faced ongoing productivity headwinds from significantly lower demand levels.

William Christensen: With that, I will hand it over to Samantha to review our financial results in greater detail.

While we continue to take action to align our operations with current order rates, while actively pursuing additional opportunities to strengthen our Partnerships with key customers in support of focused growth initiatives.

Samantha Stoddard: Thank you, Bill. Turning to slide six, market conditions continue to be challenging, but our results were in line with the high end of our internal expectations. Revenue for the second quarter was $824 million, representing a 16% decline year over year. Of this decline, approximately 13% was due to lower core revenues, reflecting anticipated volume reductions across both our North America and Europe segments, with the remainder from the court-ordered divestiture of our Towanda operations, which also negatively impacted our year-over-year comparisons. Adjusted EBITDA for the quarter came in at $39 million, a decrease of $46 million compared to the prior year. This was mainly driven by significantly lower volumes and slightly unfavorable mix, resulting in an adjusted EBITDA margin of 4.7%. Turning to cash flow, we generated negligible free cash flow in the quarter.

With that, I will hand it over to Samantha to review our financial results in greater detail.

Thank you, Bill.

Our internal expectations.

Revenue for the second quarter was 824 million representing a 16% decline year-over-year.

Decline, approximately 13% was due to lower core revenues.

Reflecting anticipated volume reductions across both our North America and Europe segments.

with the remainder, from the court ordered deer of our Towanda operations, which also negatively impacted our year-over-year comparisons

Adjusted ibida for the quarter came in at 39 million, a decrease of 46 million compared to the prior year.

This was mainly driven by significantly lower volumes and slightly unfavorable mix resulting in an adjusted ebaa. Margin of 4.7%

Samantha Stoddard: This compares to $12 million of free cash flow in the second quarter of 2024. The year-over-year decline was primarily driven by lower EBITDA. Working capital generated approximately $16 million of cash this quarter, compared to a contribution of $4 million in the second quarter of 2024. Given the pressure from lower EBITDA and continued investment in our transformation initiatives, our net debt leverage ratio increased to 5.7 times. This level of leverage far exceeds our targeted range, and reducing leverage remains one of my highest priorities. To accomplish this, we remain intensely focused on driving EBITDA improvement, exercising disciplined capital allocation, and carefully managing working capital. In addition, we continue to look at other strategic options to address our high leverage ratio. Note that we have not increased our debt levels. The increasing net leverage is driven by the lower sales volumes and corresponding lower EBITDA.

Turning to cash flow. We generated negligible free cash flow in the quarter.

This compares to 12 million of free cash flow in the second quarter of 2024.

The year-over-year decline was primarily driven by lower ibida.

Working capital generated approximately 16 million dollars of cash. This quarter compared to a contribution of 4 million in the second quarter of 2024.

Given the pressure from lower Ibida and continued investment in our transformation initiatives, our net debt leverage ratio increased to 5.7 times.

This level of Leverage, far exceeds our targeted range and reducing leverage remains 1 of my highest priorities.

To accomplish this. We remain intensely focused on driving ibida improvement, exercising, disciplined Capital allocation and carefully managing working capital.

In addition, we continue to look at other strategic options to address our high leverage ratio.

Samantha Stoddard: As shown on slide seven, the second quarter revenue decline was primarily driven by a 14% decrease in volume and mix, about a fifth of which was due to the carryover of the loss of business from a Midwest retailer, with the remainder due to ongoing market declines. Though there was a slight decline in product mix year over year, the current revenue pressure is predominantly related to continued weakness in volume. Additionally, revenue was negatively impacted by the court-ordered divestiture of our Towanda operations, while foreign currency translation associated with a stronger euro improved revenue slightly. In a few moments, I will provide additional context and more detailed insights into the underlying market trends affecting our North America and Europe segments. As shown on slide 8, adjusted EBITDA declined by $46 million year over year, primarily reflecting the significant volume declines experienced during the quarter.

Note that we have not increased our debt levels. The increasing net Leverage is driven by the lower sales volumes and corresponding lower ibida.

As shown on slide 7, the second quarter. Revenue decline was primarily driven by a 14% decrease in volume and mix.

About a fifth of which was due to the carryover of the loss of business from a Midwest retailer, with the remainder due to ongoing market declines.

Though there was a slight decline in product mix year-over-year, the current Revenue pressure is predominantly related to continued, weakness and volumes.

Additionally Revenue was negatively impacted by the court. Ordered deer of our Towanda operations, while foreign currency translation associated with the stronger Euro improved Revenue slightly

In a few moments, I'll provide additional context and more detailed insights into the underlying market trends, affecting our, North America and Europe segments.

Samantha Stoddard: As anticipated, we continue to face notable cost pressures from labor and material inflation, resulting in negative price-cost dynamics. Additionally, though we continue to drive significant improvements from our transformation initiatives and our short-term cost actions, the lower volume levels created operational inefficiencies across our manufacturing network, further weighing on overall productivity and EBITDA performance. Finally, we had positive SG&A and other income year over year, demonstrating the realization of the cost actions we continue to execute across SG&A. Moving to our segment results on slide 9, our North America segment reported revenue of $556 million for the second quarter, representing a 22% decline compared to the prior year. Of this, core revenues decreased by 15%, primarily driven by lower volumes. Adjusted EBITDA for North America declined to $35 million, compared to $76 million in the same quarter last year.

As shown on slide 8, adjusted ebit a declined by 46 million year-over-year primarily reflecting the significant volume declines experienced. During the quarter

As anticipated we continue to face notable cost, pressures from labor and material, inflation resulting in negative price cost Dynamics.

Additionally though, we continue to drive significant improvements from our transformation initiatives and our short-term cost actions. The lower volume levels created operational inefficiencies across our manufacturing Network further, Weighing on overall productivity and Ava performance.

Finally, we had positive sgna, and other income year-over-year demonstrating the realization of the cost actions. We continue to execute across sgna.

Moving to our segment results on slide 9, our North America segment reported revenue of 556 million for the second quarter representing a 22% decline compared to the prior year.

of this core revenues decreased by 15%, primarily driven by lower volumes,

Samantha Stoddard: This decrease reflects the negative impacts of lower volumes and slightly unfavorable price-cost dynamics. Productivity declined slightly year over year, driven by reduced manufacturing throughput. The decline was partially offset by positive productivity as a result of our transformation and cost mitigation actions. In Europe, revenue for the second quarter was $268 million, down only 2.7% year over year. Volumes continue to be weak in the region, but the weak dollar and selective price increases mostly offset the sales impact from volume declines. Adjusted EBITDA was $17 million, a decline of $3 million from the prior year, resulting in an adjusted EBITDA margin of 6.4%. While we achieved productivity improvements in the region, it only partially offset the adverse impacts from reduced volume. Before turning it back to William Christensen, I want to take a moment to address tariffs, which continue to be a focus for many of our investors.

Adjusted ibida for North America declined to 35 million compared to 76 million in the same quarter last year.

This decrease reflects the negative impacts of lower volumes and slightly unfavorable price cost Dynamics.

Driven by reduced Manufacturing. Throughput.

The decline was partially offset by positive productivity as a result of our transformation and cost mitigation actions.

In Europe, revenue for the second quarter was 268 million.

Down. Only 2.7% year-over-year.

To be weak in the region, but the weak dollar and selective price increase is mostly offset. The sales impact from volume decline.

Adjusted evida with seventh million dollars, a decline of 3 million from the prior year, resulting in an adjusted IBA margin of 6.4%.

While we achieved productivity improvements in the region, it only partially offset the adverse impacts from reduced volume.

Samantha Stoddard: If you turn to slide 10, you will see an overview of our current exposure based on the most recent tariff landscape. At current rates, we estimate the annualized impact of tariffs on our business to be approximately $40 million, with around $17 million expected to affect our financial results in 2025. While the situation remains dynamic, our pricing actions are designed to recover the vast majority of these costs through customer surcharges. From a sourcing standpoint, our exposure remains relatively limited. Roughly 13% of our combined Tier 1 and Tier 2 supplier spend is subject to potential tariff impact. Direct sourcing from China represents less than 1% of our total material spend. Even when including Tier 2 exposure, our China exposure is still only about 5%. We believe this modest exposure positions us well relative to others in the industry.

Before turning it back to Bill. I want to take a moment to address tariffs, which continue to be a focused for many of our investors.

If you turn to slide 10, you will see an overview of our current exposure based on the most recent tariff landscape.

At current rates, we estimate, the annualized impact of tariffs on our business to be approximately 40 million dollars with around 1725.

While the situation remains Dynamic, our pricing actions are designed to recover. The vast majority of these costs through customer search charges.

from a sourcing standpoint, our exposure remains relatively Limited

Roughly 13% of our combined, Tier 1 and tier 2 supplier spend is subject to potential tariff impact.

Direct sourcing from China represents less than 1% of our total material spent.

Even when including Tier 2 exposure, our China exposure is still only about 5%.

Samantha Stoddard: Overall, while the tariff environment remains uncertain, we are focused on staying agile, managing through near-term impacts, and executing pricing strategies that allow us to mitigate cost pressures without losing sight of customer affordability concerns. With that, I will turn it back over to Bill, who will now provide further details on our updated market outlook.

We believe this modest exposure positions us. Well, relative to others in the industry.

Overall, while the terrorist environment remains uncertain, we are focused on staying agile, managing through near-term impacts, and executing pricing strategies that allow us to mitigate cost pressures without losing sight of customer affordability. Concerns.

William Christensen: Thanks, Samantha. Turning to slide 12, I will walk through our updated full-year guidance. While the broader macro environment remains soft, we now have greater visibility regarding our expected performance for the remainder of the year. With two quarters behind us, most of the third quarter largely in view, and detailed execution plans in place for the months ahead, we are reinstating our full-year guidance. We expect full-year revenue to be between $3.2 billion to $3.4 billion, with core revenue expected to decline between 4% and 9%. Additionally, we are guiding our EBITDA expectations to reflect two factors. First, a negative price-cost relationship, and second, continued productivity pressure from lower volumes. On pricing, we are seeing increased competition at the edges and growing customer hesitation to raise prices in a market where affordability remains a concern. On the cost side, input inflation continues, particularly in materials, freight, and labor.

With that. I'll turn it back over to Bill. Who will now provide further details on our updated Market Outlook?

Thanks Samantha.

Turning to slide 12, I will walk through our updated full-year guidance.

While the broader macro environment remains soft.

We now have greater visibility regarding our expected performance for the remainder of the year.

With 2 quarters behind us.

Most of the third quarter is largely in view, and detailed execution plans are in place for the months ahead. We are reinstating our full-year guidance.

We expect full year Revenue to be between 3.2 billion to 3.4 billion.

With core Revenue, expected to decline between 4 and 9%. Additionally,

We are guiding our ebitda expectations to reflect 2 factors.

First a negative price cost relationship and second continued productivity pressure from lower volumes.

On pricing. We are seeing increased competition at the edges and growing customer hesitation to raise prices in a market, where affordability remains a concern.

On the cost side input, inflation continues.

William Christensen: While we continue to pass through most of the tariff impact, these additional cost pressures are weighing more heavily on our outlook. At the same time, lower volumes create operational inefficiencies that are impacting core productivity. These two effects, price cost and productivity, are contributing about equally to our EBITDA guidance. As a result, we expect our full-year adjusted EBITDA to be between $170 million to $200 million. Unlike in a typical year, where the third quarter is meaningfully stronger than the fourth, we now expect EBITDA to be similar in both quarters. This is largely due to the timing and impact of the actions we are taking, including transformation initiatives and targeted commercial efforts to regain share. We continue to expect $100 million of in-year transformation benefits. About half of that is carryover from last year's actions, while the remainder reflects new initiatives underway in 2025.

Particularly in materials, Freight and labor.

While we continue to pass through most of the Tariff impact.

These additional cost pressures are weighing more heavily on our Outlook.

At the same time, lower volumes, create operational inefficiencies that are impacting core productivity.

These 2 effects price cost and productivity are contributing about equally to our ebit dog guidance.

As a result.

We expect our full-year adjusted EBITDA.

To be between 170 million to 200 million.

Unlike in a typical year where the third quarter is meaningfully stronger than the fourth. We now expect ebit da to be similar in both quarters.

This is largely due to the timing and impact of the actions we are taking.

Including transformation initiatives and targeted commercial efforts to regain share.

We continue to expect 100 million dollars of in-ear transformation benefits.

About half of that is carryover from last year's actions.

William Christensen: Most of this year's activity is already in flight and progressing as planned, and we expect these benefits to continue to flow through in the second half. We expect to use approximately $10 million in operating cash flow for the full year. This is primarily due to our EBITDA expectations, combined with continued improvements in working capital management. While we continue to spend at the $150 million CapEx rate to deliver transformation benefits, should the market remain soft, we would expect 2026 CapEx to be significantly lower than our recent run rate. In total, our free cash flow is now projected to be a use of approximately $150 million. We continue to maintain ample financial flexibility. We ended the quarter with more than $130 million in cash and an undrawn $500 million revolver. We do not expect to utilize the revolver this year.

while the remainder, reflects new initiatives underway in 2025,

Progressing as planned, and we expect these benefits to continue to flow through in the second half.

We expect to use approximately 10 million dollars in operating cash flow for the full year.

This is primarily due to our ebitda expectations combined with continued improvements in working Capital Management.

While we continue to spend at the $150 million capex rate to deliver transformation benefits.

Should the market remain soft? We would expect 2026 capex to be significantly lower than our recent run rate.

In total, our free cash flow is now projected to be a use of approximately 150 million.

We continue to maintain ample Financial flexibility.

We entered the quarter with more than 130 million dollars in cash and an undrawn, 500 million revolver.

William Christensen: We do recognize the importance of addressing our leverage and are evaluating a range of options to improve our capital structure and reduce midterm refinancing risk. These options also include evaluating non-core assets. While no decisions have been made, we are assessing various options, including smaller business areas such as our North American distribution business and larger portfolio questions, including evaluating whether we are the right long-term owner of our European operations. The key message is that we are assessing and have multiple paths available to potentially strengthen our capital structure. Our intention is to provide clarity to the capital market before the end of this year, with a clear and actionable plan to reduce our leverage, address our upcoming maturities, and strengthen the business for long-term success, particularly as we prepare for improved volumes when the market recovers.

We do not expect to utilize the revolver this year.

We do recognize the importance of addressing our leverage and are evaluating a range of options to improve our capital structure and reduce midterm refinancing risk.

These options also include evaluating non-core assets.

While no decisions have been made.

We are assessing various options, including smaller business areas such as our North American distribution business.

And larger portfolio questions including evaluating, whether we are the right long-term owner of our European operations.

The key message is that we are assessing and have multiple Paths of available to potentially strengthen our capital structure.

Our intention is to provide Clarity to the Capital Market before the end of this year.

With a clear and actionable plan to reduce our Leverage.

Address our upcoming maturities.

And strengthen the business for long-term success.

William Christensen: Turning to slide 13, this chart provides an updated bridge from our 2024 EBITDA results of $275 million to our current guidance midpoint of $185 million. Since our fourth quarter 2024 call in February of this year, a notable change relates to the court-ordered Towanda divestiture. In 2024, customers built more inventory ahead of the transaction than we initially anticipated, which temporarily reduced post-close 2025 door fiber skin shipments from our other facilities. As a result, we now expect the EBITDA impact of the court-ordered divestiture to be at the high end of our original guidance range of $25 million to $50 million. That said, we are beginning to see order rate improvements as third-party inventory levels decline. We continue to see slightly lower volumes and mix, reflecting continued softness in demand. In addition, operational challenges have contributed to a modest increase in share loss.

particularly, as we prepare for improved volumes when the market recovers,

Turning to slide 13.

This chart provides an updated Bridge from our 2024 ebit doll results of 275 million.

To our current guidance midpoint of 185 million.

Since our fourth quarter 2024, call in February of this year.

A notable change relates to the court, ordered to Wanda divestiture.

In 2024, customers built more inventory ahead of the transaction than we initially anticipated.

Which temporarily reduced post-close 2025 door? Fiber skin shipments from our other facilities.

As a result. We now expect the ebitda impact of the court-ordered divestiture to be at the high end of our original guidance range of 25 million to 50 million dollars.

That said, we are beginning to see order rate improvements as third-party inventory levels decline.

We continue to see slightly lower volumes and mix.

Reflecting continued softness in demand.

William Christensen: That said, we remain on track to restore a majority of our on-time info performance by the end of the third quarter. As mentioned earlier, price-cost dynamics and base productivity have become more of a headwind than originally anticipated. Competitive pricing pressure and the inefficiencies caused by lower volumes are the main contributors. Importantly, we continue to expect approximately $150 million in benefits from our transformation and cost actions. These savings include both carryover benefits from 2024 and the in-year actions already in motion. Variable compensation is also expected to be a slightly smaller headwind than previously forecast, reflecting lower headcount as part of our mitigation efforts. Finally, foreign exchange and other, which we had originally expected to be a $10 million headwind, is now projected to be a slight tailwind due to the weakening of the U.S. dollar against the euro, as well as some other one-time benefits.

In addition, operational challenges have contributed to a modest increase in share loss.

That said, we remain on track to restore a majority of our on-time info performance by the end of the third quarter.

As mentioned earlier price cost, Dynamics and bass productivity have become more of a headwind than originally anticipated.

Competitive pricing pressure and the inefficiencies caused by lower volumes are the main contributors.

Importantly.

We continue to expect approximately 150 million dollars in benefits from our transformation and cost actions.

These savings include both carryover benefits from 2024.

and the in-ear actions already in motion,

Variable compensation is also expected to be a slightly smaller headwind than previously forecast.

Reflecting lower headcount as part of our mitigation efforts.

and finally foreign exchange and other

which we had originally expected to be a 10- dollar headwind is now, projected, to be a slight Tailwind due to the weakening of the US dollar against the euro,

William Christensen: Altogether, these updates bring us to our reinstated full-year adjusted EBITDA midpoint of $185 million. Turning to slide 14, I want to close by reiterating the strategic priorities we continue to execute against and the actions we are taking to strengthen the business in both the near term and the long term. We are actively taking the steps necessary to de-risk the business, adapt to current conditions, and position JELD-WEN Holding Inc. for future success. These efforts are well underway, and we will update investors by the end of the year with a detailed plan to improve our capital structure, address our near-term maturities, and ensure the company is prepared to grow as market conditions improve. As we look ahead, our strategic priorities remain clear and actionable. They are grounded in the work already underway across our operations and focused on the areas where we can create the most value.

as well as some other 1-time benefits.

5 million.

Turning to slide 14.

I want to close by reiterating the Strategic priorities. We continue to execute against.

And the actions we are taking to strengthen the business in both the near-term and the long term.

We are actively taking the steps necessary to do risk the business.

Adapt to current conditions and position gelden for future success.

These efforts are well underway, and we will update investors by the end of the year with a detailed plan to improve our capital structure.

Address. Our near-term maturities.

and ensure the company is prepared to grow as market conditions, improve

As we look ahead, our strategic priorities, remain clear and actionable.

William Christensen: First, we continue to rebuild strong, reliable partnerships with our customers. Service levels are improving across the business, lead times are coming down, and we are doing this while maintaining our commitment to safety, which continues to improve year over year. By aligning our teams around clear, measurable goals such as safety, quality, and on-time delivery, we are better positioned to deliver exactly what our customers expect: the right product, built with consistency, delivered in full and on time. Second, we are optimizing our manufacturing and distribution network. We continue to operate with excess capacity in parts of the business. That reality is not new, and we continue to have a disciplined approach to aligning our footprint with demand while also improving service and minimizing disruption to customers. Third, we are investing in automation to reduce costs, improve consistency, and drive long-term efficiency.

They are grounded in the work already underway across our operations and focused on the areas where we can create the most value.

First, we continue to rebuild strong reliable Partnerships with our customers.

Service levels are improving, the business lead times are coming down, and we are doing this while maintaining our commitment to safety, which continues to improve year-over-year.

By aligning our teams around clear, measurable goals—such as safety, quality, and on-time delivery.

We are better positioned to deliver exactly what our customers expect.

The right product built with consistency, delivered, in full. And on time,

Second, we are optimizing our manufacturing and distribution Network.

We continue to operate with excess capacity in parts of the business.

that reality is not new and we continue to have a disciplined approach to aligning our footprint with demand

while also improving service and minimizing disruption to customers.

William Christensen: Although past underinvestment contributed to operational complexity, we are now making steady progress in modernizing our network and enhancing productivity. One of our largest initiatives, the automation of our door facility in Garland, Texas, is now ramping up as per our internal plan, and we are already seeing meaningful benefits from the new automated production line. As we take these steps, I want to recognize and thank our teams for the work they are doing every day. Their focus, energy, and commitment make this transformation possible. I also want to thank our customers for continuing to work with us as we further improve our service and strengthen our operations. We know that housing remains a long-term need, and we are confident that the actions we are taking today, both operational and strategic, are setting this company up for meaningful, sustainable improvement.

Third, we are investing in automation to reduce costs, improve consistency and drive long-term efficiency.

Although past underinvestment contributed to operational complexity.

We are now making steady progress in modernizing, our Network and enhancing productivity.

1 of our largest initiatives, the automation of our door facility in Garland, Texas is now ramping up as per our internal plan, and we are already seeing meaningful benefits from the new automated production line.

As we take these steps, I want to recognize and thank our teams for the work. They're doing every day. They're focused energy and commitment make this transformation possible.

I also want to thank our customers for continuing to work with us as we further improve our service and strengthen our operations.

William Christensen: We are addressing the issues head-on, and we are building a stronger JELD-WEN Holding Inc. for the years ahead. Thank you once again for your continued support and interest. With that, I will now turn the call back over to James for the Q&A.

We know that housing remains a long-term need and we are confident that the actions we are taking today. Both operational and strategic are setting this company up from meaningful sustainable Improvement.

We are addressing the issues head-on and we are building a stronger geld 1 for the years ahead.

Thank you. Once again for your continued support and interest.

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

With that, I'll now turn the call back over to James for the Q&A.

Thanks Bill, operator. We're now ready to begin Q&A.

Kate: At this time, I would like to remind everyone, in order to ask a question, please press star then the number one on your telephone keypad. We request that you limit yourself to one question and one follow-up. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Susan Maklari with Goldman Sachs. Your line is open.

At this time, I would like to remind everyone that in order to ask a question, please press star, then the number 1 on your telephone keypad. We request that you limit yourself to one question and one follow-up. We will pause for just a moment to compile the Q&A roster.

Your first question comes from the line of Susan mclary with Goldman Sachs, your line is open.

Susan Maklari: Thank you. Good morning, everyone.

Speaker 7: Morning.

Thank you. Good morning everyone.

Kate: Good morning. My first question is focusing on the efforts that you have to optimize the network. You walked through, Bill, some of the steps that you've realized in the last quarter or so. Can you just give us a bit more detail on where you are within that process, how we should think about the efforts that will come through in the back half of this year and the implications that could have to the near-term margins?

Good morning, my first good morning. My first question is focusing on the efforts that you have to optimize the network. You walk through Bill some of the um some of the steps that you've realized in the last quarter or so can you just give us a bit more detail on where you are within that process how we should think about the efforts that will come through in the back half of this year and the implications that could have to the near-term margins?

William Christensen: Yeah, sure. Thanks for the question, Susan. I'd say when we're looking at a high level on our operating network, we're definitely over the 50-yard line, but we still have a lot of work to do. We're being cautious in the back half of the year and slowing pace slightly on network consolidations. There's a couple of reasons for that. Number one, we want to make sure we're preserving capital because there still is a high level of uncertainty in the market. We also want to limit service disruptions. As we've been consolidating sites, we have had some service disruptions for our customers, and our main priority is to make sure we are delivering what our customers need when they need it. So we are slowing the consolidation efforts in the back half of the year.

What our customers need when they need it. So we are slowing.

William Christensen: We're still on track to hit our targets by the end of 2026 or 2027, but all of the actions that we've taken are baked into the $100 million of transformation benefits that we have flagged on the call today, $50 million from last year and $50 million of this year, that we would expect to drop throughout the year and create that $100 million. On track, but I'd say slightly slowing the rate of progression based on what I just said.

Samantha Stoddard: Susan, just to add on that, when you look at the phasing of our EBITDA and the back half being more heavily weighted, some of that ties to some of the actions we have already taken in our network. When you think about taking the Grinnell Windows site offline and repurposing it to a door site, that did remove carrying costs, and you will see that land in the back half of this year.

Uh the consolidation efforts in the back, half of the Year we're still on track to hit our targets by the end of 26 or 27. Uh, but all of the actions that we've taken are baked into the 100 million of transformation benefits that we have flagged on the call today 50 from last year and 50 of this year that we would expect to drop uh, throughout the year and and create that 100 million. So on track. But I say slightly slowing, uh, the rate of, uh, progression based on what I just said and and Susan just to add

On that, when you look at the phasing of our ibida and the back half being more heavily weighted sum of that ties to around some of the actions we've already taken in our Network. When you think about uh, taking the grenell Windows site offline and repurposing it uh, to a door site that did remove carrying coughs. And you'll see that land in the back half of this year.

Susan Maklari: Okay. That is helpful color. Then, maybe turning to some of the factors around the operating environment, one of the things you mentioned is that it does seem to be getting a bit tougher to realize pricing. Can you just give us more context on what you are seeing there and how you are thinking about the ability to offset that inflationary pressure that you talked to as we think about the next couple of quarters?

William Christensen: Yeah, sure. So, I think our outlook, you know, we've always said we want to be price-cost neutral. Right now, we're guiding to a slight negative on price costs with inflation above price. There have been selective gives that we've had to make on price to hold volumes in certain markets. Tariff surcharges are in, and that's progressing, I'd say, more or less according to plan, but we have seen around the edges some aggressive pricing in select regions by competitors. So, it's more of a targeted approach that I think people are taking based on still a buyer's market.

Okay, that's helpful color. And then, maybe turning to some of the factors around the operating environment, one of the things you mentioned is that it does seem to be getting a bit tougher to realize pricing. Can you just give us more context on what you're seeing there and how you're thinking about the ability to offset that inflationary pressure that you talk to as we think about the next couple of quarters?

William Christensen: As we look to the back half of the year, I think what I'd signal, the market is still negative in our view, but the rate of decline is slowing, which is for us, I think, one of the first signals that we need to see to get towards a bottom. So, our expectation is price costs negative for the back half of the year, but we've been able to put tariff surcharges in, which is encouraging, and I think I'd say that just in the general market, it seems to be maintaining a balance even though volumes are still tight.

Yeah, sure. So I think our outlook, you know, we've always said we want to be priced cost neutral. Right now, we're guiding to a slight negative on price cost, with inflation above price. There have been selective gives that we've had to make on price to hold volumes in certain markets. Tariffs and store charges are in, and that is progressing, I'd say, more or less according to plan. But we have seen around the edges some aggressive pricing in select regions by competitors. So it's more of a targeted approach that I think people are taking based on still a buyer's market as we look to the back half of the year. What I signal is that the market is still negative in our view, but the rate of the decline is slowing.

Uh, which is for us, I think, 1 of the first signals that we need to see you know.

To get towards the bottom. So our expectations price cost negative for the back half of the year. Uh, but we've been able to put tariffs search charges in which is encouraging. And I think I'd say that just in the General market, it seems to be maintaining a balanced. Even though uh, volumes are still tight.

Susan Maklari: Okay. Great. Thank you both for the color, and good luck with the quarter.

William Christensen: Thank you.

Okay, great. Thank you both for the color and good luck with the quarter.

Thank you.

Susan Maklari: Thank you.

Kate: Your next question comes from the line of John Lovallo with UBS. Your line is open.

John Lovallo: Good morning, guys. Thanks for taking my questions as well. The first one is, good morning. The first one is just on some of the potential actions to address the leverage that you talked about, the financial leverage, and the North American distribution, and one was Europe. Curious, the sense of urgency here, how far along are you in the process of exploring potential options for both of these? If your view is that the market does improve as we move into next year, is there a rush to do this? Just kind of where do you guys stand on these two potential options?

Your next question comes from the line of John dallow with UBS. Your line is open.

William Christensen: Yeah, thanks for the question, John. Let me just try to recap what Samantha and I stated in the prepared remarks. With a leverage ratio at 5.7 times coming out at Q2, it is definitely above our target range, so that is a priority for us to address it. Our lending base again does not have restrictive covenants, so there are no issues from a lender standpoint that would create short-term challenges, and we have ample liquidity for the foreseeable future. This includes a significant line of credit, $500 million, which we have not drawn, nor do we plan to draw it in the back half of this year. I think that is setting the stage to really reiterate this is something that we need to do very thoughtfully. To your point, we do not have time pressure because we have ample liquidity.

Good morning guys, thanks for taking my questions as well. Um, the first 1 is is good morning. Uh the first 1 is just on some of the potential actions to um, you know, to address the leverage that you talked about the financial leverage was the North American distribution and 1 1 was Europe. Curious. Um, you know the sense of urgency here, you know, how far along are you in the process of exploring potential options for, you know, for both of these. And if your view is at the market, does, you know, improve as we move into next year, you know? Is there, you know, a rush to do this? And just kind of where, where are you guys stand on on on these uh, on these 2 potential options?

Yeah, thanks for your question, John. Let me just try and recap what? Samantha and I stated in the prepared remarks. So obviously with a leverage ratio at 5.7 times coming out of Q2, it's definitely above our target range. So that is a priority for us to address it. Our lending base. Again does not have restrictive covenants so there's no issues from A lender standpoint that would create short-term challenges and we have ample liquidity for the foreseeable future. This includes a significant line of credit 500 million which we have not drawn nor do we plan to draw it in the back half of this year. So I

William Christensen: Obviously, we do not like the elevated leverage and know we need to adjust it into a range that is reasonable, but we are going to take our time. I would say we are in the first innings of really reviewing multiple options, and we do have multiple options, and we want to make sure we strike a good balance between execution, cost of implementation, and kind of overall capital structure as we are looking out towards a market that will rebound, and we need to be ready for that. There are a lot of factors going into this. That is why we feel confident that we can come back to the capital market before the end of the year with specific details.

William Christensen: We have some maturities, but that is not until the end of next year, so we really feel that the back half of the year will be two things: running the business, delivering the results, but also making sure we have a very crisp and clear plan on the capital structure.

The year has some specific details; we have some maturities, but that's not until the end of next year. So, we really feel that the back half of the year will involve two things: running the business and delivering the results, but also making sure we have a very crisp and clear plan on the capital structure.

John Lovallo: Okay, that's helpful, Bill. Then, just some quick math. It seems like the second half implied incremental EBITDA margins over 60%. We are looking at an EBITDA margin of 7.3 versus under 4% in the first half. Just curious, what are some of the primary levers here to drive that improvement in profitability?

Okay, that's helpful, Bill. And then, you know, just some quick math. It seems like the second half implied incremental EBITDA margins over 60%. You know, looking at an EBITDA margin of 7.3% versus, you know, kind of under 4% in the first half. Just curious some of the primary levers here to drive that improvement in profitability.

Samantha Stoddard: Sure, John. This is Samantha. The incremental on the volume itself is still going to be around 30%. When you think about the volume lift, we will have 30% flow through to EBITDA. Then you have discrete actions that are being driven that essentially create additional lift into the EBITDA margin. I talked earlier about some of the footprint actions that we have taken that have already been executed, and we see those benefits flowing through in the back half. The second are more short-term cost actions through different reductions in force, again, that have already been executed, and we are seeing that play out in the back half. When you think about the $100 million of transformation, approximately $50 million of that is going to be in the back half, and then you also have the $50 million of short-term actions of which are back half loaded.

Sure, John, this is Samantha the the incremental on the volume itself is still going to be around 30%. So when you think about the volume list, we'll have 30% flow through to ibida. Then you have discrete actions that are being driven that essentially create additional lift into the ibida margin. So I talked earlier about some of the footprint actions that we've taken that have already been executed and we see those benefits flowing through in the back half.

The second are more short-term cost actions through different reductions in force again, that have already been executed, and we are seeing that play out in the back half. So when you think about the 100 million of transformation, that's, you know, approximately 50 million of that is going to be in the back half. And then you also have the

Samantha Stoddard: You are driving, I would say, a much more significant of action-specific initiatives in the back half. You also have to look at Q1 of this year was unusually low. I would also say Q4 of 2024 was unusually low, and coming out of that back to more normalized EBITDA actions is what you are seeing in the back half of the year.

50 of short-term actions of which are back half loaded. So you're driving I would say a much more significant of action specific initiatives in the back half.

You also have to look that q1 of this year was unusually low.

I also say Q4 of 2024 was unusually low and so kind of coming out of that back to more normalized. Eva actions is what you're seeing in the back half of the year.

John Lovallo: Understood. Thank you, guys.

William Christensen: Thanks, John.

Understood. Thank you, guys.

Samantha Stoddard: Thanks, John.

Thanks John. Thanks Sean.

Kate: Your next question comes from the line of Philip Ng with Jefferies. Your line is open.

Fiona: Hi, this is Fiona. I'm from Jefferies today. Congrats on the solid quarter.

Your next question comes from the line of filling with Jeffrey's your line. It's open.

Hi. This is Fiona on for food today. Congrats on the soul.

William Christensen: Hey, Fiona.

Fiona: Thank you. We saw the volumes on North America were much better than expected. Can you talk more on what you saw during the quarter for both geographic locations and maybe also some color on how much a halving was driven by volume versus mix? Thank you.

Um, thank you.

We said the volumes on North America. Were much better than I expected. Can you talk more on what you saw in the quarter, um, for the Post Geographic locations? Um, and maybe also some color on how much I have been was driven by volume versus mix. Thank you.

William Christensen: Yeah, so I'd say in the two regions, let me start with Europe. It was as expected. We're looking at a full-year low single-digit decline, and that's coming off of a low double-digit decline last year. Again, decline is still a reality in Europe, but the rate of decline is slowing significantly. Just to remind you, about 60% of our business is residential, and we're calling that down mid-single digits, and commercial, which is down slightly. That's about 40% of our business. Those are projects, so we have good visibility on a project pipeline and very mixed performance across the geographic areas. I'd say Northern Europe may be a little weaker, and Central and Western Europe stronger. So that's Europe. North America, mid-single-digit volume decline is the expectations that we're sharing today.

Yes. So I'd say in Q2, we're looking at a full year low single-digit decline, and that's coming off of a low double-digit decline last year. So again, a decline is still a reality in Europe, but the rate of decline is slowing significantly. Just to remind you, about 60% of our business is residential, and we're calling that down mid single digits, and commercial.

Which is down slightly that's about 40% of our business. Those are projects.

So we have good visibility on a project Pipeline and very mixed performance across the geographic areas. I'd say northern Europe, maybe a little weaker and Central uh and Western Europe stronger. So that's Europe, uh North America.

William Christensen: I think there's two things you need to be thinking through as you're looking at our rate of decline in Q2. I think a good rule of thumb is 50% we believe is market and 50% is share. In the 50% of share loss, there's two big buckets in there. Fiona, one would be the Midwest retailer that we will be lapping coming into Q4. That was on the Windows side, and then, of course, we have the court-ordered Towanda divestiture, which was closed in January of this year. So we're going to have a full-year base effect in 2025, and we're calling new construction and retail, both are about 45% of our business in North America, down low to mid-single digits, and then the light commercial and Canadian market, which are very project-heavy and project-driven, they're down 10% plus.

Mids single digit. Volume decline is the expectations that that we're sharing today, I think there's 2 things you need to be thinking through as you're looking at our rate of decline in 2 Q. I think a good rule of thumb is 50%, we believe is market and 50% is share in the 50% of share loss. There's 2, big buckets in there, Fiona 1 would be the Midwest retailer, that we will be lapping coming into Q4 that was on the Windows side. And then, of course, we have the court ordered to Wanda divestiture, uh, which uh, was closed in January of this year. So we're all. We're going to have a full year, uh, base effect in 2025 and and we're calling new construction and Retail. Both are about 45% of our business. In North America, download a mid single digits.

William Christensen: So I'd say mid-double digits, and that's only about 10% of our business, but obviously it has an overweight effect based on the magnitude. So I'd say no surprises. What we like to see is the rate of decline is decreasing, and there's a couple of things that I think the market needs to settle in on. One is affordability, and second is interest rates to get things kind of stabilized and back to a growth scenario. So that's our view for the back half of the year.

And then the, the Light commercial and Canadian Market which are very project, heavy and project driven, they're down 10% plus. So I'd say mid double digits and that's only about 10% of our business, but obviously it has an overweight affect based on the magnitude. Uh, so I'd say no surprises. What, what we like to see is the rate of decline is decreasing. Uh, and there's a,

Samantha Stoddard: Fiona, just to touch very quickly on the volume mix, that was a big story in 2024 with mix being, I would say, a significant decline. We are not seeing that impact of mix in 2025. So in the quarter, you are looking at more than 95% of it being volume with a very small portion being mix. We believe we are at the lower end of the mix trough, and it is much more of a volume story this quarter.

Fiona: Got it. Thank you so much for all the info, and good luck with everything.

2025. So in the quarter you're looking at more than 95% of it being volume with a very small portion being mixed. We believe we're at the lower end of the mixed troughs and it's much more of a volume story. This quarter.

William Christensen: Thank you.

Got it. Thank you so much for all the info and good luck with everything.

Thank you.

Kate: Your next question comes from the line of Keith Hughes with Truist. Your line is open.

Your next question comes from the line of Keith use with tourists. Your line is open.

Keith Hughes: Thank you. What is the first debt maturity next year that you discussed earlier in the call? I don't think it's a senior note, is it?

Um, thank you. Um, the what is the first debt maturity next year that you're you, you discussed earlier in the call, I don't think it's a senior note, is it?

Samantha Stoddard: We can talk about it. There's no debt maturity next year. It becomes current in December of 2027, or excuse me, 2026.

Keith Hughes: is the $400 million senior note you are referring to, correct?

Yeah, so we can talk about it. It doesn't. There's no debt maturity next year. It becomes current in December of 2027. So or excuse me, 2026.

Samantha Stoddard: Correct. Correct.

That's the 400 million senior note. You're referring to correct.

Keith Hughes: Okay.

Samantha Stoddard: That's the 2027 note, it's $400 million.

Keith Hughes: Okay. I guess you talked about some potential strategic actions. I want to focus on things in Europe. After you sold Australia, there was talk of maybe something potentially with Europe, and it kind of went off the table. Now it is back on the table for potential change. I guess the question is, is it the balance sheet that is driving this, or is there something more strategic in Europe that may have changed over the last couple of years that could lead to something different than the structure we see today?

Correct. Correct. Okay, that's the 2027 notes. 400 million.

Okay.

Um, so I guess the you had talked about, you know, some potential strategic actions. I want to focus on um, things in Europe. Um

After you sold Australia, um, there was talk of, you know, maybe something potentially with Europe and it kind of went off the table. Now it's back on the table uh for potential change. I guess the question is is it the balance sheet that's driving? This or is there something more strategic in Europe that may have changed over the last couple years that that could lead to something different than the structure?

We see today.

William Christensen: Yeah, thanks for the question, Keith. We have said all along, one of the things that we need to be doing is really asking the question, are we the best owner of a European asset? This is similar to what we did with Australasia. There are a couple of reflections as we are thinking through that. Number one, we are making progress in the region, and we have a great local leadership team, which is really digging into the operational improvements that were necessary, but we are starting to see traction. Number two, it has been a pretty challenging market for the last couple of years, but as interest rates have come down, and hopefully there will be a resolution to the war in the Ukraine at some point, I do think that there is more blue skies ahead than currently visible.

William Christensen: Clearly, it would be one of the ways that we could significantly reduce debt using proceeds like we did with Australasia. Finally, we need to understand as the market recovers and growth capital will need to be injected into the region, what are the costs and benefits of that, and making sure that we are going to be able to fully fund that growth. If not, then we need to consider different alternatives that may be better for the European platform and their long-term growth views. There are no decisions. It is early innings of us really evaluating all options. We have always said we need to fix things before we can assess it, and we are making pretty good progress on the fix piece, so we do think we are getting into the pocket of where we need to be asking questions like, are we best long-term owner?

Yeah, thanks for the question. Keith so we we've said all along, you know, 1 of the things that we need to be doing is really asking the question, are we the best owner of a European asset similar to what we did with Australia? And there's a couple, you know, there's a couple Reflections as we're thinking through that. Number 1, you know, we're making progress in the region and we have a great local leadership team, which is really digging into the operational improvements that were necessary, but we're starting to see traction. And number 2, it's been a pretty challenging market for the last couple of years, but as interest rates have come down and hopefully, they'll be a resolution to the war in the Ukraine. At some point. I do think that there's, uh, more Blue Skies Ahead than currently visible. And clearly, it would be 1 of the ways that we could significantly reduce debt using proceeds, like we did with Australia, Asia. And finally, we need to understand as the market recovers and growth Capital will need to be injected into the region. What are the costs and benefits of

That and making sure that we're going to be able to fully fund that growth. And if not, then we need to consider different Alternatives. That may be better uh for the European platform, and their long-term growth. Uh,

View. So there's no decisions. It's early Innings of us, really evaluating all options.

Keith Hughes: Okay. Final question. In the guide, you talked about core revenue being down 4% to 9%. What would that translate with Towanda? What would that translate into total company revenue decline?

Uh, and we've always said, we need to fix things before we can assess it, and we're making pretty good progress on the fixed piece. So, we do think we're getting into the pocket of where we need to be asking questions. Like are we best long-term owner?

Okay, final question and the guide you talked about core Revenue being down 4 to 9%. What would that translate with to Wanda? What would that translate into total company Revenue Department?

Samantha Stoddard: From an overall standpoint, Keith, the revenue decline that we're expecting from Towanda, and you remember we guided right around the time of the announcement of the divestiture in December of 2024, we would expect that to be closer to the high end of the range. Think about $170 million again to around $200 million. That's the high end that we would expect from the loss of Towanda. When you think about kind of putting it in the pocket, it's around 5% or 6% of North America.

So from an overall standpoint, Keith the, the revenue decline that we're expecting from Towanda and you remember we guided right around the time of the announcement of the domestic or in December of 2024, um, we would expect that to be closer to the high end of the range. So think about, you know, 170 again to around 200 million. That's the highest.

That we would expect.

Keith Hughes: Okay, great. Thank you very much.

From the loss of Towanda. So when you think about kind of putting it in the pocket, it's around 5% or 6% of North America.

William Christensen: Thank you.

Okay, great. Thank you very much.

Samantha Stoddard: Thanks, Keith.

Kate: Your next question comes from the line of Matthew Boulay with Barclays. The line is open.

Thank you. Thanks Keith.

Anika Dholakia: Good morning. You have Anika Dholakia on for Matt today. Thank you for taking the question.

Your next question comes from the line of Matthew Boule with Barkley East. Your line is open.

William Christensen: Hey. Good morning.

Anika Dholakia: Good morning. Looking at the EBITDA bridge for the quarter, we saw positive productivity churning from negative last quarter. It seems like we are starting to see some of those transformation costs flow through. But when I look at the fiscal year bridge, it still shows the negative productivity, which is suggesting that it is driving negative volume. I am just thinking about how you are thinking about this bucket moving into 2026 and your ability to achieve productivity in a negative volume environment. Thanks.

Good morning. You have a nikah dakia on format today. Thank you for taking the question.

Good morning, good morning, looking morning. So looking at the IBA bridge for the quarter. We saw positive productivity uh turning from negative last quarter. So seems like we're starting to see some of those transformation costs flow through.

Um,

But when I look at the fiscal year Bridge, it still shows the negative productivity which is suggesting that it's driving negative volume. So I'm just thinking about how you're thinking about this bucket moving into 2026 and your ability to achieve productivity in a negative volume environment. Thanks.

Samantha Stoddard: Sure. So talking about when you think of overall productivity, you are factoring in some of the short-term cost actions and some of the transformation. When we think about transformation, we talked earlier about the footprint actions, and that is driving a lot of fixed overhead productivity year over year. When I think of.

Head productivity year-over-year.

Kate: The guidance bridge and showing kind of that negative base productivity, that is truly the volume leverage on lower volume that we have across our network. Think of it from a lower utilization of our capacity. However, we do want to have capacity that is ready for when the market does rebound so that we can grow. We are already targeting growth initiatives that we expect to start realizing in Q4 when you see kind of the phasing of our revenue in the back half of the year. From a productivity standpoint, again, total productivity will likely still be higher for the full year. Again, that base productivity, I would say, negative offset some of the transformation and cost actions is really just again around some of the volume leverage.

In the guidance bridge and showing kind of that negative base productivity, that's truly the volume leverage on Lower volumes that we have across our Network. Think of it, from a lower utilization of our capacity.

However, we do want to have capacity that is ready for when the market does Rebound, so that we can grow and we are already targeting growth initiatives that we expect to start realizing in Q4. When you see, kind of the phasing of our Revenue in the back half of the year,

So from a productivity standpoint again Pro total productivity will likely still be higher for the full year but again that base productivity, I would say negative offset. Some of the transformation and cost actions is really just again around some of the volume Leverage.

Samantha Stoddard: Great. That's helpful. Thank you. For my second question, just shifting gears a little bit, I'm wondering if you can parse out any details on how windows are performing relative to doors. Are you seeing maybe a greater mix down on one versus the other? In terms of tariffs, is one more domestically sourced or how we should think about that? Any details on those categories would be helpful. Thanks.

Great, that's helpful. Thank you. And then

Kate: I will address the tariff question first. We are not seeing any significant change between windows and doors as affected by tariffs. I would say pretty consistent between both businesses. From a window standpoint, you asked also about the mix. The mix down that we experienced really happened in 2024. We are still seeing folks being more challenged by affordability concerns, staying at that lower end of the product base. But we are not seeing a further mix down in 2025. It is very minimal, as I said, let us call it 3% to 5% of the total volume mix headwinds that we see. I would say in general, it has been pretty consistent between both businesses. I would not have anything specific to call out. We have not seen that mix up, if that makes sense.

For my second question. Just shifting gears a little bit. I'm wondering if you can parse out any details on how windows are performing relative to doors? Are you seeing maybe a greater mix down on 1 versus the other? And then in terms of tariffs is 1 more domestically sourced or how we should think about that. Any details on those categories would be helpful. Thanks.

Yeah, so I'll just check the Tariff question first. We're not seeing um, any significant change between Windows and Doors as affected by tariffs. I would say, you know, pretty consistent between both businesses

The from a Windows standpoint, you ask also about the mix, the mix down that we experienced really happened in 2024. So we're still seeing folks being more challenged by affordability concerns staying at that lower end of of the product base. But we are not seeing any further, mix down in 2025. It's very minimal. As I said, you know, let's call it 3 to 5% of the total volume mix headwinds that we see.

um, I would say in general, it's been in pretty, pretty consistent between both businesses, I wouldn't have anything specific to call out

We haven't seen that mix up. If that makes sense.

Samantha Stoddard: Got it. Thank you and good luck.

James Armstrong: Thanks.

Got it. Thank you. And good luck.

Kate: Thank you.

James Armstrong: Before going to the next question, I would like to remind everyone in order to ask a question, please press star, then the number one on your telephone keypad. Your next question comes from the line of Mike Dahl with RBC Capital Markets. Your line is open.

Before going to the next question, I would like to remind everyone in order to ask a question. Please press star then the number 1 on your telephone keypad. Your next question comes from the line of Mike Dal with RBC Capital markets. Your line is open.

James Armstrong: Hi, this is Chris on for Mike. Just going back to the full year guide and what is implied for the back half, could you maybe give some more color on the volume mix dynamics you are expecting in the back half of the year, how that compares between kind of the non-res versus the new res and market in North America and Europe?

Hi. This is uh, Chris on for Mike. Um, just going back to the full year guide and what's implied for for the back half, could you maybe give some more caller on the volume mix Dynamics, You're Expecting in the back, half of the year. How that compares between kind of the non-res versus the new res and Market, um, in North America and Europe.

Kate: Sure. So on the back half of the year, I think there are two different factors that you have to think about, Chris. The first one is that from a year-on-year comp standpoint, we are lapping some of the share loss on that Midwest retailer. So it is an easier comp going into the back half of the year. The other is that we are targeting the area that we are targeting for growth is around our traditional channel. We are already seeing some of the gains picking up through some of our, again, very specific targeted actions to grow our windows base with builders because we have additional share that we could gain there, as well as some initiatives that we are driving through the transformation office around a stock build program. So you have the combination of lapping some of the year-on-year comps as well as targeted growth.

Sure. So, on the back half,

I think there are two different factors that you have to think about, Chris. The first one is that, from a year-on-year comp standpoint, we are lapping some of the share loss on that Midwest retailer. As a result, it’s an easier comp going into the back half of the year.

Kate: So you do see a stronger volume in Q4 than traditionally that we have felt, I would say from a phasing perspective year on year.

The other is that we are targeting the area that we are targeting for growth is around sort of our traditional Channel. And we are already seeing some of the gains picking up through some of our again. Very specific targeted actions to grow our Windows base with Builders because we have additional share that we could gain there as well as some initiatives that were driving through the transformation office around, kind of a stock build program. So you have the combination of lapping, some of the year-on-year comps, as well as targeted growth. And so, you do see a stronger volume in Q4, than traditionally that we have felt. I would say, from a phasing perspective year on year.

James Armstrong: Yeah, just to clarify, from an end market perspective, understanding the moving parts around share loss and potential share gain, but just from an end market perspective for new residents, how are you guys thinking about market declines building in the back half of the year?

James Armstrong: Yeah, so we are calling it, Chris, as we said, we are calling it down low to mid-single digits in North America, and it is fairly balanced, new and resi in our portfolio. So we expect that run rate to continue through the back half of the year. But again, if you comp it year over year, the rate of decline is slowing. Also, as Samantha called out, do not forget that there is a share aspect that you have to consider with our court-ordered divestiture of Towanda and the loss of the Midwest retailer versus kind of the underlying market decline.

Yeah, and just to clarify from an End Market perspective. Um, understanding that the moving parts around share loss and potential share game. But just from an End Market perspective for new residents, um, how you guys thinking about Market, um, declines, building in the back half of the year.

Yeah, so we're calling Chris, as we said, we're calling it. Download a mid single digits in North America and it's fairly balanced new and resi in our portfolio.

Uh, so we expect that run rate to to, to continue through the back half of the year. But again, if you comp year over year, the rate of decline is slowing.

James Armstrong: Okay. If I could just make one last one in, just going back to the second half implied ramp of transformation and headwind mitigation, I know you said some of that is already been playing out in the first half of the year, but is there any way you could give maybe some bucketing around that? What specific actions are driving the step up in the back half of the year, either on the headwind mitigation side or the transformation side? I think it would be helpful. Thank you.

Kate: Sure. So transformation, you can think about it being very evenly split on 50-50 when you think of the $100 million bucket. I think that is a pretty fair assessment. On the cost mitigation side of the $50 million actions in the full year, you are going to have, I would say, slightly more than two-thirds of that in the back half of the year that you do not have in the first half. In addition, in Q1, you had significant negative productivity because the volumes dropped off more significantly in Q4 2024 and Q1 2025 that we were not able to adapt our operating structure as quickly as possible. So that is also having an impact in, I would say, the first half from a base productivity decline that you see improving throughout the year.

Okay, and if I could just speak 1 last 1 and just going back to the second half, um, implied ramp of, of transformation and, and headwind mitigation. That, I know you said some of that already been playing playing out in the first half of the year. But is there any way you could give maybe some some bucketing around that kind of what what specific actions are driving? You know, the step up in the back half of the year, um, either on the headwind mitigation side or or the transformation side, I think it could be helpful. Thank you.

Sure. So transformation you can think about it being very evenly split on, you know, 5050. Um, when you think of the 100 million buckets. So I think that's a pretty fair assessment on the cost mitigation side of the 50 million actions in the full year.

Kate: In terms of the big buckets of what that would be, I would say the two largest buckets would be around plant closures, most of which we have already announced, plus reductions in force, a significant portion which we have announced in March. We are seeing that play out in the back half. Those are, I would say, the two largest predominant buckets. Then the other last piece being some of the transformation initiatives on growth and then the incremental EBITDA flowing through on those picking up as well.

You're going to have I would say slightly more than 2/3 of that in the back half of the year that you don't have in the first half. In addition in q1, you had significant negative productivity because the volumes dropped off more significantly in Q4 24 and q125 that we were not able to adapt our operating structure as quickly as possible. So that's also having an impact in. I would say the first task from a base productivity decline that you see improving throughout the year in terms of the big buckets of what that would be, I would say the 2 largest buckets would be around Plant closures. Most of which that we have are what

Of which we have already announced.

Plus reductions in force a significant portion which we have announced in March, and we're seeing that play out in the back half. Those are I would say the 2 largest predominant buckets and then the other last piece being some of the transformation initiative on growth and then the de the incremental ibida flowing through on those picking up as well.

James Armstrong: Understood. Appreciate all the color.

James Armstrong: All right. Thanks, Chris.

Understood all the color.

All right. Thanks Chris.

Samantha Stoddard: I will turn the call back over to James Armstrong for closing remarks.

I will turn the call back over to James Armstrong for closing remarks.

James Armstrong: Thank you for joining our call today. If you have any follow-ups, please reach out and I would be happy to help with any questions. This ends our call today and please have a great day.

Uh, thank you for joining our call today. If you have any follow-ups, please reach out and I would be happy to help with any questions this ends our call today, and please have a great day.

Samantha Stoddard: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Ladies and gentlemen, that concludes today's call, thank you all for joining. You may now disconnect

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