Installed Building Products Initiates Quarterly Cash Dividend and Increases and Extends Share Repurchase Program
Installed Building Products, Inc. (the “Company” or “IBP”) (NYSE: IBP), an industry-leading installer of insulation and complementary building products, today announced that the Board of Directors has approved the initiation of a quarterly cash dividend program. The initial quarterly dividend of $0.30 per share of common stock is payable on March 31, 2021 to stockholders of record on March 15, 2021. In addition to the quarterly cash dividend, the Board of Directors will consider an annual variable dividend to be paid in the first quarter of each year commencing in 2022. The variable dividend will be determined based on the cash flow generated by operations with consideration for planned and expected cash obligations for acquisitions and other factors as determined by the Board. The Company also announced the Board of Directors has increased the existing share repurchase program to $100.0 million and extended the program to March 1, 2022.
“Since our IPO seven years ago, we have focused on creating sustainable value for our shareholders,” stated Jeff Edwards, Chairman and Chief Executive Officer. “I am pleased with the Board’s decision to initiate a quarterly cash dividend, as well as increase and extend our share repurchase program, which reflects our commitment to creating value for shareholders.”
“The strong free cash flow characteristics of our business model and our strong balance sheet provide us with the flexibility to pursue our growth-oriented acquisition strategy, while returning capital to shareholders and supporting the long-term capital needs of our business. We will continue to prioritize profitable growth through our proven strategy of acquiring well-run installers of insulation and complementary building products, and we remain committed to targeting approximately $100.0 million of acquired revenue annually. Additional free cash flow will be used to support our ongoing cash dividends and opportunistic share repurchases, while we focus on maintaining a strong and flexible balance sheet with a net debt leverage ratio below two times,” concluded Mr. Edwards.
The declaration and payment of any future quarterly cash dividend or annual variable dividend will be at the discretion of the Board of Directors and will depend on a number of factors, including the Company's financial position, legal requirements, acquisition strategy and other factors.
Stock Repurchase Program
IBP’s Board of Directors has approved an expansion of its stock repurchase program, effective as of February 26, 2021, pursuant to which the Company may repurchase $100.0 million of its outstanding common stock. The program will remain in effect until March 1, 2022, unless extended by the Board of Directors. There was $26.7 million of availability remaining under the November 6, 2018 $100.0 million stock repurchase program.