Quanex Building Products CORP Q2 FY2025 earnings call

• Integration progress: Time and acquisition integration is progressing well, with expected cost synergies of ~$45 million (50% increase from original $30 million) and path to additional synergies. - Market conditions: North America saw volume decline Y/Y due to macro factors; Europe had market weakness but market share gains in vinyl extrusion and IG spacer product lines. - Capital allocation: Repurchased ~$23.5 million of stock in Q2, remaining ~$35.6 million authorized, focus on debt repayment and organic projects.

North American Fenestration: Net sales of $151 million in 2025 Q2, down 5.5% vs 2024 Q2. Volumes declined ~7% Y/Y with pricing up ~1%. Adjusted EBITDA was $21.3 million vs $25.4 million in 2024 Q2. European Fenestration: Generated revenue of $61.3 million in 2025 Q2, up 8.3% vs 2024 Q2. After foreign currency adjustment, revenue up 7.9%. Volumes up ~9% Y/Y with pricing down ~1%. Adjusted EBITDA was $13.2 million vs $13 million in 2024 Q2. North American Cabinet Components: Net sales $51.2 million in 2025 Q2, flat vs 2024 Q2. Volumes down ~3% with pricing up ~3%. Adjusted EBITDA was $3.1 million vs $3.4 million in 2024 Q2. Tyman business: Net sales $190.1 million in 2025 Q2. Revenue down ~2% Y/Y vs 2024 Q2. Adjusted EBITDA was $26.8 million.

• Reaffirmed net sales guidance $1.84 billion to $1.86 billion and adjusted EBITDA guidance $270 million to $280 million for fiscal 2025. - Q3 expected revenue up 8% to 10%, adjusted EBITDA margin expansion 250 to 300 basis points.

• Macro uncertainties including interest rates, tariffs, and geopolitical issues (Middle East, Ukraine) impacting consumer confidence. - Tariff risk: ~22% of COGS exposed, 13% specific to Mexico/Canada but USMCA compliant.

Q: Color on raising synergy target from $30M to $45M.

A: Combination of new segments being efficient, headcount reduction, sourcing/purchasing synergies.

Q: Tariff opportunity and domestic sourcing.

A: Geographical footprint benefits, increased quoting opportunities, especially in cabinet segment.

Q: Timing of cost synergy realization.

A: Procurement side had more opportunities, corporate groups (finance, etc.) also realized more than expected.

Q: D&A guidance.

A: 2Q run rate good, adjusted D&A guidance still around $60M excluding intangible amortization.