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Quanex Building Products Announces Fourth Quarter and Full Year 2023 Results
Source: Nasdaq GlobeNewswire / 14 Dec 2023 15:15:28 America/Chicago
Another Record Quarter for Earnings
Margin Expansion Across All Operating Segments
Repaid $40 Million in Bank Debt in Quarter
Balance Sheet and Liquidity Remain Strong
Record Year for Cash Provided by Operating ActivitiesHOUSTON, Dec. 14, 2023 (GLOBE NEWSWIRE) -- Quanex Building Products Corporation (NYSE:NX) (“Quanex” or the “Company”) today announced its results for the three months and twelve months ended October 31, 2023.
The Company reported the following selected financial results:
Three Months Ended October 31, Twelve Months Ended October 31, ($ in millions, except per share data) 2023 2022 2023 2022 Net Sales $295.5 $307.5 $1,130.6 $1,221.5 Gross Margin $80.0 $67.5 $277.5 $268.5 Gross Margin % 27.1% 21.9% 24.5% 22.0% Net Income $27.4 $24.7 $82.5 $88.3 Diluted EPS $0.83 $0.75 $2.50 $2.66 Adjusted Net Income $31.2 $25.0 $90.9 $88.9 Adjusted Diluted EPS $0.95 $0.75 $2.75 $2.68 Adjusted EBITDA $50.8 $38.7 $159.6 $152.5 Adjusted EBITDA Margin % 17.2% 12.6% 14.1% 12.5% Cash Provided by Operating Activities $44.5 $48.1 $147.1 $98.0 Free Cash Flow $29.6 $34.5 $109.7 $64.8 (See Non-GAAP Terminology Definitions and Disclaimers section, Non-GAAP Financial Measure Disclosure table, Selected Segment Data table and reconciliation tables for additional information)
George Wilson, President and Chief Executive Officer, commented, “We reported another record quarter for earnings and our balance sheet and liquidity remain strong. Despite pressure on revenue due to market volume softness related to ongoing macroeconomic challenges, and some pricing pressure as raw material costs declined, we converted very well and realized margin expansion across all operating segments in both the fourth quarter and the full year. Our continued focus on controlling what we can control helped drive our improved results and we believe we are hitting our stride from an operational standpoint. Overall, we are proud of what we were able to accomplish in 2023.
“Managing working capital and generating cash is a core focus of ours, which enabled us to pay down our bank debt by $40 million during the fourth quarter alone. In fact, we generated record free cash flow in 2023.” (See Non-GAAP Terminology Definitions and Disclaimers section and Free Cash Flow reconciliation table for additional information)
Fourth Quarter and Fiscal 2023 Results Summary
Quanex reported net sales of $295.5 million during the three months ended October 31, 2023, which represents a decrease of 3.9% compared to $307.5 million for the same period of 2022. The Company reported net sales of $1.13 billion during the twelve months ended October 31, 2023, which represents a decrease of 7.4% compared to $1.22 billion for the same period of 2022. The decreases were primarily attributable to softer market demand and lower pricing in North America. Quanex reported net sales growth of 1.3% for the fourth quarter of 2023 and a decline of 2.9% in net sales for the full year in its North American Fenestration segment. Excluding the contribution from the LMI Custom Mixing assets the Company acquired on November 1, 2022, net sales in the North American Fenestration segment would have declined by 10.7% for the fourth quarter and 13.9% for the full year. In its North American Cabinet Components segment, Quanex reported a decline of 23.7% in net sales for the fourth quarter and a decline of 21.9% in net sales for the full year. Excluding foreign exchange impact, the Company realized a decrease in net sales of 3.7% for the fourth quarter and a decrease of 2.8% in net sales for the full year in its European Fenestration segment. (See Sales Analysis table for additional information)
The increase in adjusted earnings for the three months and twelve months ended October 31, 2023 was largely attributable to effective cost control, real price increases, a decline in raw material costs and a decrease in income tax expense. As such, Quanex was able to realize margin expansion in the fourth quarter and full year in each of its operating segments and on a consolidated basis.
Balance Sheet Update
As of October 31, 2023, Quanex had total debt of $70.0 million ($18.5 million excluding real-estate leases that are considered “finance” leases under U.S. GAAP) and the Company’s leverage ratio of Net Debt to LTM Adjusted EBITDA decreased to 0.1x (Net Debt free excluding these real-estate leases). As of October 31, 2023, Quanex’s LTM Adjusted EBITDA was $159.6 million and LTM Net Income, the most directly comparable GAAP measure, was $82.5 million. (See Non-GAAP Terminology Definitions and Disclaimers section, Net Debt Reconciliation table and Last Twelve Months Adjusted EBITDA Reconciliation table for additional information)
Outlook
Mr. Wilson stated, “We enter fiscal 2024 with a somewhat cautious outlook for the first half due to the ongoing macroeconomic challenges combined with typical seasonality in our business, but we are optimistic that demand for our products will improve in the second half as consumer confidence is restored over time. However, consistent with the last two years, based on current macro indicators, recent conversations with our customers, limited transparency, and varying opinions on the outlook for 2024, we are taking a thoughtful approach to guidance for 2024. As such, we believe it would be premature to give guidance at this time and intend to re-visit guidance for 2024 when we report earnings for the first quarter. Our long-term view continues to be optimistic as the underlying fundamentals for the residential housing market remain positive.”
Conference Call and Webcast Information
The Company has also scheduled a conference call for Friday, December 15, 2023 at 11:00 a.m. ET (10:00 a.m. CT) to discuss the release. A link to the live audio webcast will be available on Quanex’s website at http://www.quanex.com in the Investors section under Presentations & Events.
Participants can pre-register for the conference call using the following link: https://register.vevent.com/register/BI8c21998a92f24071bb721ad032dd7661
Registered participants will receive an email containing conference call details for dial-in options. To avoid delays, it is recommended that participants dial into the conference call ten minutes ahead of the scheduled start time. A replay will be available for a limited time on the Company’s website at http://www.quanex.com in the Investors section under Presentations & Events.
About Quanex
Quanex is a global manufacturer with core capabilities and broad applications across various end markets. The Company currently collaborates and partners with leading OEMs to provide innovative solutions in the window, door, vinyl fencing, solar, refrigeration, custom mixing and cabinetry markets. Looking ahead, Quanex plans to leverage its material science expertise and process engineering to expand into adjacent markets.
For more information contact Scott Zuehlke, Senior Vice President, Chief Financial Officer & Treasurer, at 713-877-5327 or scott.zuehlke@quanex.com.
Non-GAAP Terminology Definitions and Disclaimers
Adjusted Net Income (defined as net income further adjusted to exclude purchase price accounting inventory step-ups, transaction costs, certain severance charges, gain/loss on the sale of certain fixed assets, restructuring charges, asset impairment charges, other net adjustments related to foreign currency transaction gain/loss and effective tax rates reflecting impacts of adjustments on a with and without basis) and Adjusted EPS are non-GAAP financial measures that Quanex believes provide a consistent basis for comparison between periods and more accurately reflects operational performance, as they are not influenced by certain income or expense items not affecting ongoing operations. EBITDA (defined as net income or loss before interest, taxes, depreciation and amortization and other, net) and Adjusted EBITDA (defined as EBITDA further adjusted to exclude purchase price accounting inventory step-ups, transaction costs, certain severance charges, gain/loss on the sale of certain fixed assets, restructuring charges and asset impairment charges) are non-GAAP financial measures that the Company uses to measure operational performance and assist with financial decision-making. Net Debt is defined as total debt (outstanding balance on the revolving credit facility plus financial lease obligations) less cash and cash equivalents. The leverage ratio of Net Debt to LTM Adjusted EBITDA is a financial measure that the Company believes is useful to investors and financial analysts in evaluating Quanex’s leverage. In addition, with certain limited adjustments, this leverage ratio is the basis for a key covenant in the Company’s credit agreement.
Free Cash Flow is a non-GAAP measure calculated using cash provided by operating activities less capital expenditures. Quanex uses the Free Cash Flow metric to measure operational and cash management performance and assist with financial decision-making. Free Cash Flow is measured before application of certain contractual commitments (including capital lease obligations), and accordingly is not a true measure of the Company’s residual cash flow available for discretionary expenditures. Quanex believes Free Cash Flow is useful to investors in understanding and evaluating the Company’s financial and cash management performance.
Quanex believes that the presented non-GAAP measures provide a consistent basis for comparison between periods and will assist investors in understanding the Company’s financial performance when comparing results to other investment opportunities. The presented non-GAAP measures may not be the same as those used by other companies. Quanex does not intend for this information to be considered in isolation or as a substitute for other measures prepared in accordance with U.S. GAAP.
Forward Looking Statements
Statements that use the words “estimated,” “expect,” “could,” “should,” “believe,” “will,” “might,” or similar words reflecting future expectations or beliefs are forward-looking statements. The forward-looking statements include, but are not limited to, the following: impacts from public health issues (including pandemics, such as the recent COVID-19 pandemic) on the economy and the demand for Quanex’s products, the Company’s future operating results, future financial condition, future uses of cash and other expenditures, expenses and tax rates, expectations relating to Quanex’s industry, and the Company’s future growth, including any guidance discussed in this press release. The statements and guidance set forth in this release are based on current expectations. Actual results or events may differ materially from this release. For a complete discussion of factors that may affect Quanex’s future performance, please refer to the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2022, and the Company’s Quarterly Reports on Form 10-Q under the sections entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Any forward-looking statements in this press release are made as of the date hereof, and Quanex undertakes no obligation to update or revise any forward-looking statements to reflect new information or events.
QUANEX BUILDING PRODUCTS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME (In thousands, except per share data) (Unaudited) Three Months Ended October 31, Twelve Months Ended October, 31 2023 2022 2023 2022 Net sales $ 295,492 $ 307,532 $ 1,130,583 $ 1,221,502 Cost of sales 215,473 240,073 853,059 953,004 Selling, general and administrative 29,326 29,334 123,957 117,108 Depreciation and amortization 11,194 9,555 42,866 40,109 Operating income 39,499 28,570 110,701 111,281 Interest expense (1,565 ) (710 ) (8,136 ) (2,559 ) Other, net (6,110 ) 136 (5,519 ) 1,041 Income before income taxes 31,824 27,996 97,046 109,763 Income tax expense (4,442 ) (3,329 ) (14,545 ) (21,427 ) Net income $ 27,382 $ 24,667 $ 82,501 $ 88,336 Earnings per common share, basic $ 0.84 $ 0.75 $ 2.51 $ 2.67 Earnings per common share, diluted $ 0.83 $ 0.75 $ 2.50 $ 2.66 Weighted average common shares outstanding: Basic 32,753 32,916 32,819 33,048 Diluted 32,991 33,082 33,026 33,205 Cash dividends per share $ 0.08 $ 0.08 $ 0.32 $ 0.32 QUANEX BUILDING PRODUCTS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) October 31, 2023 October 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 58,474 $ 55,093 Accounts receivable, net 97,311 96,018 Inventories, net 97,959 120,890 Income taxes receivable 8,298 - Prepaid and other current assets 11,558 8,664 Total current assets 273,600 280,665 Property, plant and equipment, net 250,664 180,400 Operating lease right-of-use assets 46,620 56,000 Goodwill 182,956 137,855 Intangible assets, net 74,115 65,035 Other assets 3,188 4,662 Total assets $ 831,143 $ 724,617 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 74,371 $ 77,907 Accrued liabilities 50,319 52,114 Income taxes payable 384 1,049 Current maturities of long-term debt 2,365 1,046 Current operating lease liabilities 7,224 7,727 Total current liabilities 134,663 139,843 Long-term debt 66,435 29,628 Noncurrent operating lease liabilities 40,361 49,286 Deferred pension benefits - 3,917 Deferred income taxes 29,133 22,277 Liabilities for uncertain tax positions 250 1,361 Other liabilities 14,747 13,470 Total liabilities 285,589 259,782 Stockholders’ equity: Common stock 372 372 Additional paid-in-capital 251,576 251,947 Retained earnings 409,318 337,456 Accumulated other comprehensive loss (38,141 ) (49,422 ) Treasury stock at cost (77,571 ) (75,518 ) Total stockholders’ equity 545,554 464,835 Total liabilities and stockholders' equity $ 831,143 $ 724,617 QUANEX BUILDING PRODUCTS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (In thousands) (Unaudited) Twelve Months Ended October, 31 2023 2022 Operating activities: Net income $ 82,501 $ 88,336 Adjustments to reconcile net income to cash provided by operating activities: Depreciation and amortization 42,866 40,109 Loss on the disposition of capital assets 278 109 Stock-based compensation 2,521 2,291 Deferred income tax 5,147 2,097 Other, net 1,529 1,905 Changes in assets and liabilities: Decrease in accounts receivable 6,969 6,945 Decrease (increase) in inventory 30,024 (32,035 ) Increase in other current assets (1,880 ) (970 ) Decrease in accounts payable (11,611 ) (3,047 ) Decrease in accrued liabilities (4,249 ) (3,159 ) Decrease in income taxes payable (9,009 ) (5,192 ) (Decrease) increase in deferred pension benefits (359 ) 77 Increase in other long-term liabilities 683 305 Other, net 1,642 194 Cash provided by operating activities 147,052 97,965 Investing activities: Business acquisition (91,302 ) - Capital expenditures (37,390 ) (33,121 ) Proceeds from disposition of capital assets 253 159 Cash used for investing activities (128,439 ) (32,962 ) Financing activities: Borrowings under credit facilities 102,000 70,500 Repayments of credit facility borrowings (100,000 ) (95,500 ) Debt issuance costs - (1,210 ) Repayments of other long-term debt (2,567 ) (1,747 ) Common stock dividends paid (10,639 ) (10,598 ) Issuance of common stock 1,215 689 Payroll tax paid to settle shares forfeited upon vesting of stock (567 ) (1,413 ) Purchase of treasury stock (5,593 ) (6,600 ) Cash used for financing activities (16,151 ) (45,879 ) Effect of exchange rate changes on cash and cash equivalents 919 (4,092 ) Increase in cash and cash equivalents 3,381 15,032 Cash and cash equivalents at beginning of period 55,093 40,061 Cash and cash equivalents at end of period $ 58,474 $ 55,093 QUANEX BUILDING PRODUCTS CORPORATION FREE CASH FLOW AND NET DEBT RECONCILIATION (In thousands) (Unaudited) The following table reconciles the Company's calculation of Free Cash Flow, a non-GAAP measure, to its most directly comparable GAAP measure. The Company defines Free Cash Flow as cash provided by operating activities less capital expenditures. Three Months Ended October 31, Twelve Months Ended October, 31 2023 2022 2023 2022 Cash provided by operating activities $44,493 $48,111 $147,052 $97,965 Capital expenditures (14,940) (13,633) (37,390) (33,121) Free Cash Flow $29,553 $34,478 $109,662 $64,844 The following table reconciles the Company's Net Debt which is defined as total debt principal of the Company plus finance lease obligations minus cash. As of October 31, 2023 2022 Revolving credit facility $15,000 $13,000 Finance lease obligations (1) 55,000 19,202 Total debt (2) 70,000 32,202 Less: Cash and cash equivalents 58,474 55,093 Net Debt $11,526 ($22,891) (1) Includes $51.5 million and $17.7 million in real estate lease liabilities considered finance leases under U.S. GAAP as of October 31, 2023 and October 31, 2022, respectively. (2) Excludes outstanding letters of credit. QUANEX BUILDING PRODUCTS CORPORATION NON-GAAP FINANCIAL MEASURE DISCLOSURE LAST TWELVE MONTHS ADJUSTED EBITDA RECONCILIATION (In thousands, except per share data) (Unaudited) Reconciliation of Last Twelve Months Adjusted EBITDA Three Months Ended
October 31, 2023Three Months Ended
July 31, 2023Three Months Ended
April 30, 2023Three Months Ended
January 31, 2023Total Reconciliation Reconciliation Reconciliation Reconciliation Reconciliation Net income as reported $ 27,382 $ 31,698 $ 21,512 $ 1,909 $ 82,501 Income tax expense 4,442 4,099 5,551 453 14,545 Other, net 6,110 (402 ) 29 (218 ) 5,519 Interest expense 1,565 2,068 2,244 2,259 8,136 Depreciation and amortization 11,194 10,596 10,456 10,620 42,866 EBITDA 50,693 48,059 39,792 15,023 153,567 Cost of sales (1) (35 ) - 48 - 13 Selling, general and administrative (1),(2) 109 395 63 5,448 6,015 Adjusted EBITDA $ 50,767 $ 48,454 $ 39,903 $ 20,471 $ 159,595 (1) Loss on damage to manufacturing facilities caused by weather. (2) Transaction and advisory fees. QUANEX BUILDING PRODUCTS CORPORATION NON-GAAP FINANCIAL MEASURE DISCLOSURE (In thousands, except per share data) (Unaudited) Reconciliation of Adjusted Net Income and Adjusted EPS Three Months Ended
October 31, 2023Three Months Ended
October 31, 2022Twelve Months Ended
October 31, 2023Twelve Months Ended
October 31, 2022Net Income Diluted EPS Net Income Diluted EPS Net Income Diluted EPS Net Income Diluted EPS Net income as reported $ 27,382 $ 0.83 $ 24,667 $ 0.75 $ 82,501 $ 2.50 $ 88,336 $ 2.66 Net income reconciling items from below 3,851 $ 0.12 290 $ - 8,401 $ 0.25 581 $ 0.02 Adjusted net income and adjusted EPS $ 31,233 $ 0.95 $ 24,957 $ 0.75 $ 90,902 $ 2.75 $ 88,917 $ 2.68 Reconciliation of Adjusted EBITDA Three Month Ended
October 31, 2023Three Months Ended
October 31, 2022Twelve Months Ended
October 31, 2023Twelve Months Ended
October 31, 2022Reconciliation Reconciliation Reconciliation Reconciliation Net income as reported $ 27,382 $ 24,667 $ 82,501 $ 88,336 Income tax expense 4,442 3,329 14,545 21,427 Other, net 6,110 (136 ) 5,519 (1,041 ) Interest expense 1,565 710 8,136 2,559 Depreciation and amortization 11,194 9,555 42,866 40,109 EBITDA 50,693 38,125 153,567 151,390 EBITDA reconciling items from below 74 564 6,028 1,114 Adjusted EBITDA $ 50,767 $ 38,689 $ 159,595 $ 152,504 Reconciling Items Three Months Ended
October 31, 2023Three Months Ended
October 31, 2022Twelve Months Ended
October 31, 2023Twelve Months Ended
October 31, 2022Income Statement Reconciling Items Income Statement Reconciling Items Income Statement Reconciling Items Income Statement Reconciling Items Net sales $ 295,492 $ - $ 307,532 $ - $ 1,130,583 $ - $ 1,221,502 $ - Cost of sales 215,473 35 (1 ) 240,073 - 853,059 (13 ) (1 ) 953,004 - Selling, general and administrative 29,326 (109 ) (1),(2) 29,334 (564 ) (2 ) 123,957 (6,015 ) (1),(2) 117,108 (1,114 ) (2 ) EBITDA 50,693 74 38,125 564 153,567 6,028 151,390 1,114 Depreciation and amortization 11,194 - 9,555 - 42,866 - 40,109 - Operating income 39,499 74 28,570 564 110,701 6,028 111,281 1,114 Interest expense (1,565 ) - (710 ) - (8,136 ) - (2,559 ) - Other, net (6,110 ) 5,232 (3 ) 136 (222 ) (3 ) (5,519 ) 5,196 (3 ) 1,041 (386 ) (3 ) Income before income taxes 31,824 5,306 27,996 342 97,046 11,224 109,763 728 Income tax expense (4,442 ) (1,455 ) (4 ) (3,329 ) (52 ) (4 ) (14,545 ) (2,823 ) (4 ) (21,427 ) (147 ) (4 ) Net income $ 27,382 $ 3,851 $ 24,667 $ 290 $ 82,501 $ 8,401 $ 88,336 $ 581 Diluted earnings per share $ 0.83 $ 0.75 $ 2.50 $ 2.66 (1) Loss on damage to manufacturing facilities caused by weather. (2) Transaction and advisory fees. (3) Foreign currency translation losses (gains) and pension settlement expense. (4)Tax impact of net income reconciling items. QUANEX BUILDING PRODUCTS CORPORATION SELECTED SEGMENT DATA (In thousands) (Unaudited) This table provides gross margin, operating (loss) income, EBITDA, and Adjusted EBITDA by reportable segment. Non-operating expense and income tax expense are not allocated to the reportable segments. NA Fenestration EU Fenestration NA Cabinet Components Unallocated Corp & Other Total Three months ended October 31, 2023 Net sales $ 180,446 $ 64,170 $ 51,868 $ (992 ) $ 295,492 Cost of sales 135,490 39,070 41,488 (575 ) 215,473 Gross Margin 44,956 25,100 10,380 (417 ) 80,019 Gross Margin % 24.9 % 39.1 % 20.0 % 27.1 % Selling, general and administrative 15,272 8,354 5,135 565 29,326 Depreciation and amortization 5,211 2,714 3,220 49 11,194 Operating income (loss) 24,473 14,032 2,025 (1,031 ) 39,499 Depreciation and amortization 5,211 2,714 3,220 49 11,194 EBITDA 29,684 16,746 5,245 (982 ) 50,693 Loss on damage to manufacturing facilities (Cost of sales) (35 ) - - - (35 ) Loss on damage to manufacturing facilities (SG&A) - - (131 ) - (131 ) Transaction and advisory fees - - - 240 240 Adjusted EBITDA $ 29,649 $ 16,746 $ 5,114 $ (742 ) $ 50,767 Adjusted EBITDA Margin % 16.4 % 26.1 % 9.9 % 17.2 % Three months ended October 31, 2022 Net sales $ 178,175 $ 62,104 $ 67,993 $ (740 ) $ 307,532 Cost of sales 141,395 42,121 56,904 (347 ) 240,073 Gross Margin 36,780 19,983 11,089 (393 ) 67,459 Gross Margin % 20.6 % 32.2 % 16.3 % 21.9 % Selling, general and administrative 15,636 7,686 6,111 (99 ) 29,334 Depreciation and amortization 4,032 2,256 3,177 90 9,555 Operating income (loss) 17,112 10,041 1,801 (384 ) 28,570 Depreciation and amortization 4,032 2,256 3,177 90 9,555 EBITDA 21,144 12,297 4,978 (294 ) 38,125 Transaction and advisory fees - - - 564 564 Adjusted EBITDA $ 21,144 $ 12,297 $ 4,978 $ 270 $ 38,689 Adjusted EBITDA Margin % 11.9 % 19.8 % 7.3 % 12.6 % Twelve months ended October 31, 2023 Net sales $ 667,482 $ 250,774 $ 215,445 $ (3,118 ) $ 1,130,583 Cost of sales 517,805 158,491 178,210 (1,447 ) 853,059 Gross Margin 149,677 92,283 37,235 (1,671 ) 277,524 Gross Margin % 22.4 % 36.8 % 17.3 % 24.5 % Selling, general and administrative 56,979 32,350 21,074 13,554 123,957 Depreciation and amortization 20,539 9,849 12,208 270 42,866 Operating income (loss) 72,159 50,084 3,953 (15,495 ) 110,701 Depreciation and amortization 20,539 9,849 12,208 270 42,866 EBITDA 92,698 59,933 16,161 (15,225 ) 153,567 Loss on damage to manufacturing facilities (Cost of sales) - - 13 - 13 Loss on damage to manufacturing facilities (SG&A) - - 69 - 69 Transaction and advisory fees - - - 5,946 5,946 Adjusted EBITDA $ 92,698 $ 59,933 $ 16,243 $ (9,279 ) $ 159,595 Adjusted EBITDA Margin % 13.9 % 23.9 % 7.5 % 14.1 % Twelve months ended October 31, 2022 Net sales $ 687,458 $ 262,058 $ 275,704 $ (3,718 ) $ 1,221,502 Cost of sales 537,900 180,268 236,695 (1,859 ) 953,004 Gross Margin 149,558 81,790 39,009 (1,859 ) 268,498 Gross Margin % 21.8 % 31.2 % 14.1 % 22.0 % Selling, general and administrative 58,735 31,846 21,934 4,593 117,108 Depreciation and amortization 16,253 9,674 13,830 352 40,109 Operating income (loss) 74,570 40,270 3,245 (6,804 ) 111,281 Depreciation and amortization 16,253 9,674 13,830 352 40,109 EBITDA 90,823 49,944 17,075 (6,452 ) 151,390 Transaction and advisory fees - - - 1,114 1,114 Adjusted EBITDA $ 90,823 $ 49,944 $ 17,075 $ (5,338 ) $ 152,504 Adjusted EBITDA Margin % 13.2 % 19.1 % 6.2 % 12.5 % QUANEX BUILDING PRODUCTS CORPORATION SALES ANALYSIS (In thousands) (Unaudited) Three Months Ended October 31, Twelve Months Ended October, 31 2023 2022 2023 2022 NA Fenestration: (1) United States - fenestration $ 138,783 $ 162,147 $ 518,396 $ 609,572 International - fenestration 8,081 4,954 30,100 35,906 United States - non-fenestration 29,267 6,922 103,090 29,039 International - non-fenestration 4,315 4,152 15,896 12,941 $ 180,446 $ 178,175 $ 667,482 $ 687,458 EU Fenestration: (2) International - fenestration $ 49,862 $ 46,329 $ 191,871 $ 194,854 International - non-fenestration 14,308 15,775 58,903 67,204 $ 64,170 $ 62,104 $ 250,774 $ 262,058 NA Cabinet Components: United States - fenestration $ 4,286 $ 4,408 $ 16,899 $ 17,696 United States - non-fenestration 47,092 62,818 195,866 254,726 International - non-fenestration 490 767 2,680 3,282 $ 51,868 $ 67,993 $ 215,445 $ 275,704 Unallocated Corporate & Other: Eliminations $ (992 ) $ (740 ) $ (3,118 ) $ (3,718 ) $ (992 ) $ (740 ) $ (3,118 ) $ (3,718 ) Net Sales $ 295,492 $ 307,532 $ 1,130,583 $ 1,221,502 (1) Includes the net sales from the acquisition of LMI of $21.4 million and $75.6 million for the three and twelve months ended October 31, 2023, respectively. (2) Reflects an increase of $4.5 million and a reduction of $4.1 million in revenue associated with foreign currency exchange rate impacts for the three and twelve months ended October 31, 2023, respectively. 
