PGT Innovations, Inc. (NYSE:PGTI) Q4 2022 Earnings Call Transcript

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And remember to what you have to think about from our end is we have different scenarios and different planning actions, should the economy turn one way versus continue to be stable versus being more robust? Right. So we have to be pretty agile on our feet. And what I would suggest and what I think is, what we’ve said long-term is we expect this business to be an upper teens EBITDA margin business going forward. So that would be the expectation is that we would continue to maintain this business to be that upper teens EBITDA down margin business.

Jeff Jackson: And I will just, we’ve already been flexible in terms of cost reduction initiatives. We started that at the end of the fourth quarter, when we saw some order pattern changes. Today, we’ve had reduction in force of 100, roughly 147 people, and attrition of another 100. So we’re down about 240 people, over the last call it three months. So we’re watching our cost. We’re only investing where there’s a great return. And we definitely feel strong about holding opportunity margins over the coming year.

Unidentified Analyst: Okay. Got it. Yes. That definitely makes sense. And then, I guess, looking at 4Q, the operational headwinds from the hurricane disruption and the ransomware issue on the ultimate impact on revenues were lower than you had initially forecasted. Can you just talk about how those dynamics played out in the quarter, and if there’s any expected carryover impact into 2023.

John Kunz: So the dynamics in the quarter were, for each of those, we lost order entry for a period of time. And for us to recover and get back up. The hurricane specifically disrupted our production or our ability to produce. So that was one where we lost that revenue in, had to be made up to the degree that we could. The ransomware attack was basically to shut us down from an order entry perspective, so we weren’t able to recover. The good news is, we’ve made dramatic changes, our operating team here in the southeast region did a wonderful job. As Jeff said, got back to rates, where we weren’t prior to the storm. So we’re making that back up. With respect to order entry, we are back online, and we’re moving forward from that perspective.

So there’s no continuing effect from either of those. They were both related to the quarter. And our expectation is that as we move into Q1, as long as we continue to deliver, as Jeff said, from an operational perspective, from an all time and full, I think we’re going to continue to see a dealer base that is pleased with our performance and continue to — we will continue to be the supplier of choice.

Operator: Thank you. This concludes the question-and-answer session. I’d like to turn the call back over to management for closing remarks.

Jeff Jackson: Thank you. We appreciate your participation today on our fourth quarter and full year 2022 earnings call. We look forward to your continued participation and support of the company. And we will talk to you again on our first quarter 2023 earnings call in May. Thank you again.

Operator: Thank you, conference now concluded. Thank you for attending today’s presentation. You may now disconnect.

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