- **Residential Growth Outperformance**: 9% YoY net sales growth driven by new products and channel expansion, vs. flat R&R market.
- **Merger Synergy Confidence**: $625M total synergies (cost + sales) with James Hardie, supported by contractor demand for combined solutions.
- **Margin Expansion Progress**: 27.5% adjusted EBITDA margin in Q2, on track to meet 27.5%+ target ahead of 2027 milestone.
- **Recycling-Driven Efficiency**: $40M+ cost savings from expanded recycling network, with 2026 benefits from NW Polymers acquisition.
- **Tariff Resilience**: Minimal direct impact on U.S.-sourced materials; pricing offsets 2025 tariff exposure.


**【CEO Opening Remarks】**
- **Residential Segment Growth**: Q2 2025 residential net sales increased 9% YoY, driven by mid-single-digit sell-through growth and new product launches (e.g., TimberTech Harvest+ decking, Reliance Rail). 
- **Material Conversion Strategy**: 75% of decking and 60% of rail sold annually are wood-based, with AZEK targeting wood replacement through innovative, low-maintenance products.
- **James Hardie Merger Synergies**: $125M cost savings and $500M incremental sales expected, with contractors expressing strong interest in combined offerings.
- **Recycling Expansion**: Acquired Northwest Polymers to expand West Coast recycling capacity, supporting 27.5% adjusted EBITDA margin target.

**【CFO Financial Highlights】**
- **Q2 2025 Results**: 
  - Consolidated net sales: $452M (+8% YoY)
  - Adjusted EBITDA: $124M (+10% YoY)
  - Adjusted EBITDA margin: 27.5% (+40bps YoY)
  - Residential segment EBITDA: $122M (+11% YoY)
- **FY25 Guidance**: 
  - Net sales: $1.52B-$1.55B (5%-8% YoY growth)
  - Adjusted EBITDA: $403M-$418M (6%-10% YoY growth)
  - Free cash flow: $1M in Q2, with $110M-$120M capex for recycling and facility expansion.
- **Tariff Impact**: $12M-$15M annualized exposure offset by pricing actions, with minimal direct impact due to U.S.-based supply chain.

**【Q&A Key Takeaways】**
- **Channel Inventory Management**: Below-historical inventory levels to maintain flexibility amid macro uncertainty.
- **Sales Synergy Potential**: Contractors see value in combined AZEK-James Hardie offerings, with siding installers expressing interest in AZEK decking.
- **Recycling Cost Savings**: $40M+ savings target from expanded recycling network, with 2026 benefits from Northwest Polymers acquisition.
- **Tariff Mitigation**: Modest price increases offset 2025 tariff impact; no material impact on U.S.-sourced raw materials.


AZEK(Delisted)

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