Janus International Group, Inc. Q3 FY2025 earnings call

• The team is executing in a challenging environment, with confidence in end market fundamentals and backlog/pipeline stability.
• Financial results: Adjusted EBITDA was $43.6 million (+1.2% Y/Y), adjusted net income $22.6 million (+1.3% Y/Y), adjusted EPS $0.16. Cash from operating activities was $15 million, free cash flow $8.3 million. Liquidity: $256.2 million total liquidity, $554 million long-term debt, net leverage 2.3x.
• Innovation: BETCO expanded metal decking product line, Noke Smart Entry platform got a redesigned web portal.
• Capital allocation: Continued share repurchase program, evaluating M&A; S&P upgraded credit rating from B+ to BB- with stable outlook.
• Self-storage industry resilience and consolidation present growth opportunities for R3.

In the third quarter of 2025, Janus International Group reported total revenue of $219.3 million, down 4.7% from Q3 2024. The self-storage business saw a 3.7% revenue increase. New Construction was up 5.5%, driven by strength in the International segment offsetting softness in the North American market. The R3 sales channel grew 0.7% due to door replacement and renovation activity. The Commercial and Other sales channel decreased 20.1%, primarily due to declines in the TMC business (accounting for ~70% of the decline) and weakness in the LTL trucking industry. The International segment had total revenues of $28.3 million, up $7 million or 32.9% year-over-year, driven by New Construction. Despite the decline in commercial sheet doors, rolling steel and architectural offerings showed growth. The Noke Smart Entry system had 439,000 installed units at quarter end, a 35.9% year-over-year increase. The BETCO brand expanded its metal decking product line, and the Noke Smart Entry platform launched a redesigned web portal.

• Updated 2025 guidance: Revenues expected in range of $870 million to $880 million, adjusted EBITDA in range of $164 million to $170 million (midpoint adjusted EBITDA margin 19.1%, down from original due to product/mix).
• Anticipate free cash flow conversion of adjusted net income will be above 75% to 100% target for 2025.

• Macro factors like tariffs, interest rates, and other economic conditions could affect results.
• TMC business is lumpy and subject to project timing variability; commercial sheet doors market is soft; LTL trucking industry faces weakness due to broader economic impacts.

Q: Looking at the guidance, revenue is unchanged but EBIT is lower at the midpoint. Can you add color on delta between mix, tariffs, input costs?

A: Biggest thing was product mix and segment mix; international sales were up meaningfully with lower margin. Tariffs and input costs not material.

Q: What do backlogs and quoting from core REIT customers tell regarding their plans and budgets for growth in 2026?

A: Backlog and pipeline looked pretty stable, no change from last quarter.

Q: Color on weakness in TMC, how much is timing vs end market softness?

A: TMC projects impacted by weather and customer decisions (push out of projects); LTL market softer due to tariffs. Most TMC business is R&R, with projects expected to come back later.

Q: On self-storage U.S. business, how is North America unfolding vs expectations?

A: R3 acceleration not as fast as expected, but New Construction balance coming as expected; mostly in institutional REITs.

Q: On Noke successes domestically, how stand things? Chances of large adoption?

A: Institutional activity picked up, Noke Ion proven; large client saw 90% reduction in theft; optimistic about additional use cases, step function higher adoption possible.