Builders FirstSource, Inc. (NASDAQ:BLDR) Q3 2019 Earnings Conference Call Transcript
Nov 01, 2019 • 10:00 am ET
Good morning and welcome to Builders FirstSource's Third Quarter Conference Call. [Operator Instructions]. Following the company's remarks, we will conduct a question-and-answer session. Today's call is being recorded and will be available at www.bldr.com.
It is now my pleasure to introduce Mr. Binit Sanghvi, Vice President, Investor Relations. Please go ahead.
Thank you. Chantelle. Good morning and welcome to Builders FirstSource third quarter 2019 earnings conference call. With me on the call today are Chad Crow, Chief Executive Officer and Peter Jackson. Chief Financial Officer. A copy of the slide presentation referenced on this call is available on the Investor Relations section of the Builders FirstSource website at bldr.com.
Before we begin, let me note that during the course of this conference call we may make statements concerning the company's future prospects, financial results, business strategies and industry trends. Such statements are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995 and are subject to certain risks and uncertainties which could cause actual results to differ materially from expectations. Please refer to our most recent Form 10-K filed with the Securities and Exchange Commission and other reports filed with the SEC for more information on those risks. The company undertakes no obligation to publicly update or revise any forward-looking statements. The Company will discuss adjusted results on this call. We have provided reconciliations of non-GAAP financial measures to their GAAP equivalents in our earnings press release and detailed explanations of non-GAAP financial measures in our Form 8-K filed yesterday, both of which are also available on our website.
I will now turn the call over to Chad Crow.
Good morning, and thank you for joining us. I will start on Slide 2. Our team delivered an impressive performance in the third quarter, building on our year-to-date progress to produce above market growth, expand margins and generate outstanding cash flow. I'm proud to say that we recorded the 13th straight quarter of year-over-year increases in adjusted EBITDA and achieved an EBITDA margin of 8.1% of sales, our highest quarterly percentage since our 2015 acquisition of ProBuild.
Our ongoing strategic investments in market leading value-added products capacity has provided the targeted growth, margin and customer value benefits we anticipated. Our operational excellence initiatives also continued to gain momentum and are contributing to our results. And notably our strong cash flow and working capital management, continue to fund our investments, which included an acquisition of three strategic truss manufacturing plants and further pay down of debt. We were especially pleased to achieve the low end of our long-term targeted ratio of net debt to adjusted EBITDA of 2.5x as of the end of the quarter.
We believe our success is a direct result of our commitment to our strategic initiatives. Our momentum in sales volume during the quarter continued from the strong first half of 2019, supported by an improvement in our -- in all of our end markets. For the first nine months of the year, sales volume, excluding commodity