Armstrong World Industries, Inc. (NYSE:AWI) Q3 2018 Earnings Conference Call Transcript
Oct 30, 2018 • 11:00 am ET
Good day, ladies and gentlemen, and welcome to Third Quarter Armstrong World Industries Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions will follow at that time (Operator Instructions).
As a reminder -- I would now like to turn the conference over to your host, Tom Waters, Vice President, Corporate Finance. You may begin, sir.
Thank you, Nicole. Good morning and welcome. Please note that members of the media have been invited to listen to this call, and the call is being broadcast live on our website at armstrongceilings.com.
With me today are Vic Grizzle, our CEO; and Brian MacNeal, our CFO. Hopefully, you have seen our press release this morning, and both the release and the presentation Brian MacNeal will reference during this call, are posted on our website in the Investor Relations section (Forward-Looking Cautionary Statements). In addition, our discussion of operating performance will include non-GAAP financial measures within the meaning of SEC Regulation G. A reconciliation of these measures with the most directly comparable GAAP measures is included in the press release and in the appendix of the presentation. Both are available on our website.
With that, I'll turn the call over to Vic.
Thanks, Tom, and good morning, everyone. It's good to be with you today to review our quarterly results and our outlook for the remainder of 2018. Third quarter was a busy quarter with strong results. Our topline expanding 11% in the quarter was the best performance in seven years. Adjusted EBITDA grew double-digits, free cash flow grew 20%.
Our team earned enough like-for-like pricing to cover inflation. We closed another acquisition in Architectural Specialties, and we received the entire $330 million in cash from the sale of our international operations. The third quarter results were strong in both sales and EBITDA, both up double-digits. Total company sales growth of 11% continues the positive trend that began in 2017. We have broken out of the multi-year pattern of low single-digit growth and have delivered high single-digit growth for the second year in a row.
With the acquisition of Steel Ceilings in the quarter, our second this year, and together with an improving acquisition pipeline our confidence is growing that we can continue strong sales growth. Sales in our Mineral Fiber business were up 7% driven by strong like-for-like pricing and mix gains, which together drove higher average unit values or AUV. Price realization in the quarter was sequentially stronger than the first two quarters of the year. In both the quarter and year-to-date periods, we have earned price increases ahead of the inflationary headwinds.
Our sales and distribution partner teams have done a fantastic job on pricing in these inflationary times. Also supporting our higher AUV was the improvements in mix driven by stronger sales in our high-end products. The Total Acoustics and Sustain families both grew significantly faster than the overall Mineral Fiber category. Mineral Fiber volume overall was fractionally down