American Woodmark Corporation

Fourth-quarter net sales were $400.4 million, down $52.9 million or 11.7% year over year. Remodel sales declined 10.4% and new construction sales declined 13.4%. Gross margin was 17.0%, down 160 basis points from 18.6% a year ago. Adjusted EBITDA was $47.1 million, or 11.8% of net sales, versus $54.7 million or 12.1% last year; reported EPS was $1.71 and adjusted EPS was $1.61. For fiscal 2025, net sales were $1.7 billion, down 7.5%, gross margin was 17.9% versus 20.4%, adjusted EBITDA was $208.6 million versus $252.8 million, and adjusted net income was $105.5 million. Free cash flow was $65.7 million, net leverage was 1.56x, cash was $48.2 million, and the company had $314.2 million available on its revolver. For fiscal 2026, the company expects net sales from low-single-digit declines to low-single-digit increases and adjusted EBITDA of $175 million to $200 million. Management said that assuming tariffs in place at May 28 business close, the tariff cost impact would be roughly $20 million, and that the guidance includes recovery scenarios ranging from 0% to 100%.

Scott Culbreth framed the year as one of execution in a difficult housing and consumer backdrop, with weaker-than-expected demand, tariff uncertainty, and declining consumer confidence pressuring traffic. He emphasized that American Woodmark is still investing in growth, digital transformation, and platform design, including product innovation, capacity expansion, ERP migration, and footprint optimization. His tone was cautious but constructive, with repeated comments that lower mortgage rates, better confidence, and higher existing home sales should eventually support demand.

Paul Joachimczyk highlighted that Q4 adjusted net income was $24 million and adjusted EPS was $1.61, while adjusted EBITDA was $47.1 million. He said full-year fiscal 2025 free cash flow was positive at $65.7 million, down about $73 million from last year mainly because of lower net income, higher inventory, and lower accrued balances. He also noted year-end cash of $48.2 million, $314.2 million of revolver availability, net leverage of 1.56x, $96.7 million of share repurchases in fiscal 2025, and $117.8 million remaining under the buyback authorization. For fiscal 2026, he cited higher SG&A, input costs, fixed-cost inflation, about $7 million of annual incremental interest expense from a new debt agreement, and about $11 million of higher depreciation expense.

Analysts focused heavily on tariffs, asking how much impact was embedded and whether pricing could offset it; management said the outlook assumes about $20 million of tariff cost based on May 28 policies, with recovery modeled from 0% to 100%, and noted a court ruling could reduce price/cost delay risk. Questions also centered on margins, SG&A, and whether the second half of fiscal 2026 can improve; management said Q4 margin recovery reflected operational actions and footprint right-sizing, while SG&A should not be extrapolated because incentive comp was unusually favorable. On demand, management said the back-half recovery assumption is based on partner commentary and better expected market conditions, but it is too early to point to clear data confirming growth.