On this page of StockholderLetter.com we present the latest annual shareholder letter from BEACON ROOFING SUPPLY INC — ticker symbol BECN. Reading current and past BECN letters to shareholders can bring important insights into the investment thesis.

 •  4/3/2024 Letter Continued (Full PDF)
 •  4/5/2023 BECN Stockholder Letter
 •  More "Construction Materials & Machinery" Category Stockholder Letters
 •  BECN Benford's Law Stock Score = 78

BECN Shareholder/Stockholder Letter Transcript:

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A LETTER TO OUR STOCKHOLDERS:
In 2023, we built on the momentum from the prior year and generated record results by executing our Ambition 2025 Value Creation
Framework. We exceeded the revenue and shareholder return targets we communicated more than two years ahead of plan. We generated
net sales of $9.1 billion, 8 percent growth year over year with higher revenue in our residential and complementary lines of business.
We remained focused on ensuring high caliber service and delivering residential, commercial and complementary products to our customers.
We delivered net income of $435 million, a record $930 million in Adjusted EBITDA and our third consecutive year of strong net income
margins and double-digit EBITDA margins.
Non-discretionary repair and re-roo   ng activity drove growth in residential roo   ng demand, partially offset by softness in new residential
construction demand due to higher interest rates. Commercial sentiment remained healthy while, at the same time, destocking at our
customer contractor level subdued demand. Our focus remains on the areas within our control to drive above-market growth and excel in
safety and operational efficiency. Our strategic initiatives provide multiple paths for growth and margin expansion and continue to enable us
to achieve our Ambition 2025 targets.
We have the most complete digital offering in the industry and our e-commerce capability is a competitive advantage. In 2023, we invested
in serving our customers in ways that bring them the most value. One of these is third-party integrations which drove a 23% year-over-year
increase in digital sales. We are building on our digital leadership by continuing to invest in differentiation.
Our private label line of high-quality building products sold under the TRI-BUILT   brand delivers professional results and helps our customers
to stand out from competitors. We continue to    nd ways to leverage our brand in ways that will drive adoption by our customers. In 2023,
sales of these high-margin products reached a record high, and we are on track to deliver on our Ambition 2025 goal of achieving revenue
of $1 billion by 2025.
Our focus on national accounts is also generating results. We have invested in specialized account representatives who focus on the
operational dynamics in each end-market and can offer a differentiated value proposition for high-volume customers. In 2023, sales to our
largest customers reached their highest level in history.
Our longstanding continuous improvement mindset, including the initiative to drive improved performance at our bottom quintile branches,
has generated meaningful contribution for many years, and 2023 was no different. The structure to improve these branches is simple and
repeatable and made a signi   cant contribution to the top-line and the bottom-line.
Our strategic growth teams are executing on our pipeline of value-creating green   eld and acquisition investments. During the year, we
exceeded our original plan to open at least 15 locations by commissioning 28 new branches across 17 states. In addition, we welcomed nine
acquisitions, adding 21 branches with new markets, leadership, and technical capabilities.
Our Beacon OTC   network remained a differentiator. At year end, we had 59 markets including over 279 networked branches which share
inventory,    eet, equipment, employees and systems for an optimal customer delivery experience. The result is improved customer service,
lower cost to serve, better inventory management and accelerated talent development.
Attracting and retaining the best talent is critical to unlocking the potential of our people, our growth engine, and our operations. We    lled
several key leadership positions within our sales force, lines of business and leadership ranks, while at the same time advancing our diversity,
equity and inclusion initiatives.
We remained committed to being a vital member of the local communities in which we live, operate, and serve. In May, we issued our second
Corporate Social Responsibility report centered around our core values. We proudly shared safety performance data and provided additional
employee diversity data. In addition, we disclosed our greenhouse gas (GHG) scope 1 and 2 emissions intensity, which we have decreased
by six percent since 2020.
Our strategic initiatives are designed to create shareholder value, and we are committed to improving returns for owners of our stock.
In 2023, we repurchased approximately 1.6 million common shares for more than $110 million bringing our total two-year common stock
retirement to approximately $500 million. In addition, we simpli   ed our capital structure by redeeming the outstanding preferred shares
reducing the    as converted    share count by 9.7 million. Since the start of Ambition 2025, we have deployed nearly $1.3 billion reducing the
   as converted    share count by more than 21 percent.
As we look forward, we have signi   cant runway for growth in a large and attractive market. Our business model is resilient and we are well
positioned to generate value for all of our stakeholders. I thank our more than 8,000 team members for an outstanding 2023 and their
relentless commitment to helping our customers build more every day.
We sincerely appreciate the support from the investment community as well as our valued customers, suppliers, and employees.
Sincerely,
Julian G. Francis
President and Chief Executive Officer
April 3, 2024



 4/3/2024 Letter Continued (Full PDF)