- \n
- \nFourth quarter and full year net sales decreased 3.5% and increased 1.3% year-over-year to $644.6 million and $2.7 billion, respectively<\/p>\n<\/li>\n
- \nFourth quarter and full year net (loss) income margin decreased 860 basis points and 370 basis points year-over-year to (6.5)% and 1.0%, respectively<\/p>\n<\/li>\n
- \nFourth quarter and full year adjusted EBITDA margin1<\/sup> decreased 580 basis points and 260 basis points year-over-year to 5.4% and 10.9%, respectively<\/p>\n<\/li>\n
- \nFourth quarter and full year diluted (loss) earnings per share were $(0.33) and $0.21, compared to $0.11 and $0.96 in the prior year, respectively; fourth quarter and full year adjusted diluted (loss) earnings per share1<\/sup> were $(0.02) and $0.91, compared to $0.22 and $1.40 in the prior year, respectively<\/p>\n<\/li>\n
- \nCompany announces $30 million of cost rationalization expected to be achieved in 2026<\/p>\n<\/li>\n
- \nCompany introduces first quarter 2026 financial outlook<\/p>\n<\/li>\n<\/ul>\n
BEACHWOOD, Ohio–(BUSINESS WIRE<\/a>)–
\nMasterBrand, Inc. (NYSE: MBC, the \u201cCompany,\u201d or \u201cMasterBrand\u201d), the largest residential cabinet manufacturer in North America, today announced fourth quarter and full year 2025 financial results.<\/p>\n\n\u201cIn the fourth quarter, we continued taking decisive actions to strengthen MasterBrand, even as demand remained soft and the trade environment became more complex,\u201d said Dave Banyard, President and Chief Executive Officer. \u201cWe are executing a coordinated, multifaceted tariff mitigation plan, flexing our manufacturing network to match demand, and maintaining a sharp focus on cost management and cash generation. As part of these efforts, we are implementing targeted cost actions in the first quarter that are expected to deliver approximately $30 million of savings in 2026. At the same time, we remain focused on advancing our strategic priorities, including integration planning for the pending combination with American Woodmark.\u201d<\/p>\n
\nBanyard continued, \u201cWhile market conditions remain challenging, we are confident in our strategy and our ability to emerge stronger and deliver long-term value for shareholders as market conditions normalize.\u201d<\/p>\n
Fourth Quarter 2025<\/span><\/b><\/p>\n
\nNet sales were $644.6 million, a decrease of 3.5% compared to the fourth quarter of 2024, following a mid-single-digit year-on-year market decline, partially offset by the continued flow through of previously implemented price and tariff-related pricing actions.<\/p>\n
\nGross profit was $167.5 million, compared to $203.3 million in the prior year. Gross profit margin decreased 440 basis points to 26.0% on lower volume, mix, and the related unfavorable fixed cost leverage, tariffs net of supply chain mitigation, and restructuring-related expenses, partially offset by net average selling price (\u201cASP\u201d) improvements, our continuous improvement efforts, and Supreme integration synergies.<\/p>\n
\nNet loss was $(42.0) million, compared to net income of $14.0 million in the fourth quarter of 2024, and net loss margin was (6.5)%, compared to net income margin of 2.1% in the prior year primarily as a result of lower gross profit and higher SG&A expenses, partially offset by lower interest expense and lower income tax expense.<\/p>\n
\nAdjusted EBITDA1<\/sup> was $35.1 million, compared to $74.6 million in the fourth quarter of 2024. Adjusted EBITDA margin1<\/sup> decreased 580 basis points to 5.4% due to lower volume and the related unfavorable fixed cost leverage, tariffs net of supply chain mitigation, and material, freight, and personnel inflation, partially offset by continuous improvement efforts, net ASP improvements, and Supreme integration synergies.<\/p>\n
\nDiluted loss per share was $(0.33) compared to diluted earnings per share of $0.11 in the fourth quarter of 2024. Adjusted diluted loss per share1<\/sup> was $(0.02) compared to adjusted diluted earnings per share1<\/sup> of $0.22 in the fourth quarter of 2024.<\/p>\n
Full Year 2025<\/span><\/b><\/p>\n
\nNet sales were $2.7 billion, an increase of 1.3% compared to 2024, driven by a 5% contribution from Supreme and net ASP improvements, partially offset by a mid-single-digit market decline.<\/p>\n
\nGross profit was $827.6 million, compared to $877.0 million in the prior year. Gross profit margin decreased 220 basis points to 30.3% on lower volume and the related unfavorable fixed cost leverage, inflation, and tariffs. This was partially offset by net ASP improvements and the full year inclusion of Supreme and its related synergies.<\/p>\n
\nNet income was $26.7 million, compared to $125.9 million in 2024, primarily due to lower gross profit and increased SG&A expense, partially offset by lower income tax expense. Net income margin was 1.0% compared to 4.7% in the prior year.<\/p>\n
\nAdjusted EBITDA1<\/sup> was $298.2 million, compared to $363.6 million in 2024. Adjusted EBITDA margin1<\/sup> decreased 260 basis points to 10.9%, compared to 13.5% in the prior year, driven by lower volume and the related unfavorable fixed cost leverage, material, freight, and personnel inflation, tariffs net of supply chain mitigation, and incremental strategic investments, partially offset by net ASP improvements, including tariff-related pricing, and Supreme contributions and integration synergies.<\/p>\n
\nDiluted earnings per share were $0.21 compared to $0.96 in 2024. Adjusted diluted earnings per share1<\/sup> were $0.91 compared to $1.40 in 2024.<\/p>\n
Balance Sheet, Cash Flow and Capital Allocation<\/span><\/b><\/p>\n
\nAs of December 28, 2025, the Company had $183.3 million in cash and $441.9 million of availability under its revolving credit facility. Total debt was $974.5 million, and ratio of total debt to net income from the most recent trailing twelve months was 36.5x as of December 28, 2025. For the same period, net debt1<\/sup><\/b> was $791.2 million and the ratio of net debt to adjusted EBITDA1<\/sup> was 2.7x.<\/p>\n
\nNet cash provided by operating activities was $195.7 million for the fifty-two weeks ended December 28, 2025, compared to $292.0 million for the fifty-two weeks ended December 29, 2024. Free cash flow1<\/sup> was $117.5 million for the fifty-two weeks ended December 28, 2025, compared to $211.1 million for the fifty-two weeks ended December 29, 2024. The declines in net cash provided by operating activities and free cash flow were driven by the decline in net income versus the prior year.<\/p>\n
\nDuring the fifty-two weeks ended December 28, 2025, the Company repurchased approximately 1.4 million shares of common stock for approximately $18.1 million. No share repurchases were made during the fourth quarter of 2025. The Company is restricted from repurchasing shares under its merger agreement with American Woodmark until the close of the merger.<\/p>\n
First Quarter 2026 Financial Outlook<\/span><\/b><\/p>\n
\nContinued macroeconomic uncertainty driven by a volatile trade environment and actions deferred ahead of the anticipated American Woodmark merger are driving greater variability in key performance drivers, cost inputs and near-term demand trends across MasterBrand\u2019s end markets, limiting the Company\u2019s ability to provide a full-year outlook with the level of confidence it believes is appropriate. As a result, MasterBrand is taking a measured approach to its outlook and is transitioning to providing quarterly guidance until longer-term visibility improves.<\/p>\n
\nAdditionally, to strengthen operating flexibility in the current environment, MasterBrand is implementing an expected $30 million of cost actions to align its cost structure with current demand levels. The Company expects to achieve these savings over the course of 2026, with benefits beginning in the first quarter.<\/p>\n
\nFor the first quarter of 2026, the Company expects the following:<\/p>\n
- \n
- \nNet sales year-over-year decrease of mid-single-digit to high-single-digit percentage<\/p>\n<\/li>\n
- \nAdjusted EBITDA1,2<\/sup> in the range of $23 to $33 million, with related adjusted EBITDA margin1,2<\/sup> in the range of 3.9% to 5.3%<\/p>\n<\/li>\n
- \nAdjusted diluted earnings per share1,2<\/sup> in the range of $(0.06) to $0.00<\/p>\n<\/li>\n<\/ul>\n
\nFor full year 2026, MasterBrand expects its addressable market to be down mid-single digits. The Company also expects the following:<\/p>\n
- \n
- \nGross tariff costs of approximately 5-6% of 2026 net sales<\/p>\n<\/li>\n
- \nInterest expense to be flat to down year-over-year<\/p>\n<\/li>\n
- \nEffective tax rate to improve year-over-year<\/p>\n<\/li>\n
- \nFree cash flow to be in excess of 2026 net income<\/p>\n<\/li>\n<\/ul>\n
\nThis financial outlook only reflects the impact of those tariffs in effect as of the date of this release and the anticipated antidumping plywood duties, and does not reflect any other potential tariffs or tariff-related impacts on Company costs or end market demand. The Company believes the dynamic nature of the tariffs, specifically the uncertainty of implementation, potential timing and duration, limits the usefulness of estimating this information. MasterBrand undertakes no obligation to update this outlook as circumstances evolve. Additionally, this outlook does not reflect any anticipated financial benefits from the pending merger with American Woodmark, nor does it include expected transaction or integration-related costs.<\/p>\n
\n\u201cOur teams are actively advancing tariff mitigation initiatives, and we expect the benefits to accumulate over the course of 2026, supporting stronger profitability later in the year,\u201d said Andi Simon, Executive Vice President and Chief Financial Officer. \u201cThat said, evolving trade dynamics, the related ongoing macroeconomic uncertainty, and actions deferred ahead of the pending American Woodmark merger have reduced near-term visibility. As a result, we are moving to quarterly guidance, which we believe will provide more decision-useful updates as our plan progresses and our visibility improves. Even in this environment, we remain confident in our strategy and our ability to bolster margins and deliver long-term value over time.\u201d<\/p>\n
- \nAdjusted diluted earnings per share1,2<\/sup> in the range of $(0.06) to $0.00<\/p>\n<\/li>\n<\/ul>\n
- \nFourth quarter and full year diluted (loss) earnings per share were $(0.33) and $0.21, compared to $0.11 and $0.96 in the prior year, respectively; fourth quarter and full year adjusted diluted (loss) earnings per share1<\/sup> were $(0.02) and $0.91, compared to $0.22 and $1.40 in the prior year, respectively<\/p>\n<\/li>\n
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