...Greetings, and welcome to TopBuild's Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, PI Aquino, Vice President of Investor Relations. Thank you. You may begin. Good morning, and thanks for joining us. On our call today are Robert Buck, President and Chief Executive Officer, and Rob Kuhns, Chief Financial Officer. We have posted our earnings release, senior management's formal remarks, and a presentation that summarizes our comments on our website at topbuild.com. Many of our remarks today will include forward-looking statements, which are subject to known and unknown risks and uncertainties, including those set forth in this morning's press release, as well as in the company's filings with the SEC. The company assumes no obligation to update any forward-looking statements because of new information, future events, or otherwise. Please note that some of the financial measures to be discussed during this call will be on a non-GAAP basis. The non-GAAP measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliation of these financial measures to the most comparable GAAP measures in a table included in today's press release and in our presentation, both of which are available on our website. I'll now turn the call over to President and CEO, Robert Buck. Good morning, and thank you for joining us today. TopBuild delivered a solid second quarter, with both segments growing top line sales and bottom line profits. Our teams have stayed focused on driving profitable growth and operational improvements across all of our businesses, even considering uneven housing demand and various commercial project delays, both the result of higher interest rates for longer than originally anticipated. I'm proud of the strength of our team and the diversification of our business model, which positions us well to deliver long-term growth. Today's underbuilt housing landscape, rising household formations, potential for interest rate moderation, and escalating demand for energy-efficient building codes support the long-term demand for TopBuild's products and services. Turning to our results, sales grew 3.7% to $1.37 billion, as both of our segments realized pricing, increased volumes, and benefited from acquisitions. While volumes across both segments improved, they were softer than we anticipated in the quarter. We reported adjusted EBITDA of $277.7 million and an adjusted EBITDA margin of 20.3%. Excluding last year's estimated $10 million margin benefit in Q2 related to our multifamily and commercial business, our same branch incremental EBITDA margin was 41.2%, which is a result of the continued excellent work by our Special Ops team. When adjusting for this margin benefit last year, we delivered both the highest quarterly sales in our history and the highest adjusted EBITDA margin in our history. This demonstrates the fundamentals of our business are performing well. On the material side, fiberglass and certain commercial products are still in tight supply. Our teams are doing a great job managing through the supply situation, and while we saw volume growth in both segments this quarter, our growth was constrained by material supply. Turning to our end markets, our residential business grew 5.4% in the quarter. The single-family environment continues to improve, and although housing demand has been choppy in certain regions, our teams continue to do a nice job balancing price and volume, given current local business conditions. We continue to see year-over-year growth in multifamily work, although bidding has slowed. Our backlog remains strong, and we fully expect the backlog to carry into 2025. The commercial and industrial end markets are also feeling the impact of the higher interest rate environment as the timing of some projects have been pushed out to 2025. But the good news is that we are not seeing project cancellations. We see these projects as future demand, and this is more of a timing issue. As we've noted before, we participate across numerous verticals in commercial and industrial. Let me spend a minute talking about one such commercial and industrial vertical that is growing rapidly. Data centers store and manage digital data for organizations in highly regulated and controlled environments. Today, there are over 150 active projects in various stages under construction in the United States. On the installation side, our teams participate in applications such as fireproofing and fire stopping, fiberglass insulation, spray foam, acoustics, and various types of rigid board applications on interior and exterior walls. On the specialty distribution side of the business, our services range from distributing standard mechanical insulation products to custom fabricated and engineered insulation solutions. For example, on the exterior of the building, we will distribute insulation for the piping of air chillers. We custom fabricate aluminum jacket coverings, as well as provide calcium silicate inserts to both insulate and provide structural integrity in long runs of critical piping. We also provide insulation for interior ductwork and other mechanical systems. Just to give you an idea of some of the work we are doing, in the Pacific Northwest, we are working on a 27-acre data center project that has six data halls planned. We started work about a month ago, although we originally planned to be on site earlier in Q2. Given the delay, we now anticipate our work on this project will continue into early 2025. In the Southwest, we have been awarded six buildings within a large data center business park. For just one of these buildings, we'll be providing over 55,000 linear feet of insulation. In short, our total TopBuild revenue for a data center project can be as much as $7 million-$8 million. Our backlog of work related to data centers continues to grow, with projects secured well into 2026. Moving to capital allocation, acquisitions continue to be our number one priority. In the last 18 months, we've made acquisitions totaling approximately $280 million in annual revenue. M&A is a core competency at TopBuild, and we have a strong track record of execution and generating great returns for shareholders. One recent acquisition that closed at the end of May was Texas Insulation, with $39 million in annual sales. With three locations, Texas Insulation's talented team expands our spray foam capabilities into an important and rapidly growing geography, demonstrating our ability to make acquisitions in our core insulation business. Today, our M&A pipeline is as strong as ever, and our team is busy evaluating numerous potential acquisition candidates across all three end markets we serve. While we remain focused on our core of insulation, we're always evaluating opportunities to leverage our core competencies and have the potential to expand our total addressable market. As we announced last quarter, our board approved a new $1 billion share repurchase program. In the second quarter, we returned approximately $505 million to shareholders, which demonstrates management's and our board's confidence in the business outlook. As you saw in our press release this morning, we are revising our outlook for 2024. Rob will speak to the guidance in more detail, but the revision is, in large part, a reflection on timing of demand rather than any underlying changes in the business. In summary, we posted another quarter of solid growth, and our business performed very well as we navigated uneven demand, project delays, and supply tightness. We are confident we will deliver another year of strong, profitable growth and increased shareholder value. Rob? Thanks, Robert, and thank you to our teams for their effort as we delivered another solid quarter. Total sales of $1.37 billion, the highest quarter in our history, grew 3.7% as both segments grew sales sequentially and on a year-over-year basis. M&A, net of a disposition, drove a 2.3% increase, while price was up 1.3%. Price was primarily driven by the first quarter fiberglass price increase, partially offset by 1% due to lower prices on spray foam and gutters that carried over from last year. On a segment basis, installation grew net sales by 5.2% to $851 million. Net M&A added 2.9%, pricing added 1.3%, and volume was up 1%. Residential sales grew 6.7% for the installation segment, as sales for single-family homes continued to improve, both sequentially and on a year-over-year basis, and multifamily sales continued to be strong due to our backlog. The installation segment's commercial sales were down 1.9% due to shifts in project timing and material availability. Net sales for specialty distribution grew 3.2% to $593 million in the second quarter. Volume improved 0.6%, while pricing and acquisitions each contributed 1.3%. Specialty distribution residential sales grew by 4.6% as demand for single-family homes continued to improve. Commercial and industrial sales for the distribution segment also grew by 2.3%. In the second quarter, we delivered gross profit of $423.9 million, or a 31% margin, which was 100 basis points lower than last year. As we've discussed over the last several quarters, our second quarter 2023 margins had a one-time benefit of approximately $10 million from higher than normal margins on multifamily and commercial projects. Excluding this, gross margin declined 30 basis points versus last year, primarily due to the impact of acquisitions. Our second quarter adjusted SG&A expense was 13.6% of sales, a 30 basis point improvement over prior year. TopBuild adjusted EBITDA in the second quarter totaled $277.7 million, or a margin of 20.3%. Excluding the $10 million margin benefit from last year, our Adjusted EBITDA margin expanded 10 basis points, and our same branch incremental EBITDA margin was 41.2%, driven by productivity gains and improved pricing in both segments. The installation segment had an Adjusted EBITDA margin of 22.3%, a 10 basis point expansion after excluding the $10 million benefit last year. Specialty distributions Adjusted EBITDA margin rose 10 basis points year-over-year to 17.7%. Other income and expense of $7.2 million in the quarter was down from $14 million last year due to interest income from higher cash balances. Adjusted earnings per diluted share totaled $5.42 in the quarter, 3.2% higher than last year. Turning now to our balance sheet and cash flow, we had total liquidity of $899.5 million at quarter end, which includes cash of $463.2 million, and availability under our revolver of $436.2 million. Net debt at the end of the quarter was $947.4 million, and our leverage ratio was 0.88x last twelve months Adjusted EBITDA. Working capital as a percent of sales was 14.8% in the quarter, down 10 basis points compared to last year at this time. While working capital is lower than it was a year ago at this time, it has risen since year-end due to material availability as we work to ensure that we have inventory on hand. Free cash flow for the trailing twelve months totaled $663.4 million, an increase of 11.9% versus $592.9 million last year. Our capital allocation priorities remain clear. M&A continues to be our number one priority for reinvestment. To date, in 2024, we've completed 6 acquisitions totaling more than $100 million in annual revenue. As Robert noted earlier, acquisitions have totaled $280 million of revenue on an annual basis for the last 18 months. Our second capital allocation priority is returning capital to shareholders, and in the quarter, we repurchased 1.25 million shares at an average price of approximately $405 per share, totaling $505.2 million. At the end of June, we had $649.2 million remaining under the authorization. You can expect us to continue to prioritize our M&A pipeline and to be opportunistic with our share repurchases. Finally, turning to our outlook, we are revising our full-year sales guidance to $5.3 billion-$5.5 billion. This reduction of $100 million at the midpoint reflects the choppiness in demand, primarily in our commercial markets, partially offset by recent M&A and higher prices from the second fiberglass price increase. While demand is still strong, some of the growth we had anticipated the second half of this year will likely be pushed into 2025. We continue to expect 2024 residential sales to grow mid-single digits, and we now expect low single-digit growth in commercial and industrial. We have also tightened and lowered our EBITDA guidance to a range of $1.055 billion-$1.125 billion, which is a reduction of $20 million at the midpoint and reflects our solid year-to-date profit performance, as well as confidence in our team's ability to continue to drive profitable growth and productivity improvements. I also want to remind you that the $10 million one-time multifamily commercial margin benefit we discussed this quarter had a $25 million impact for the full year. The remaining $15 million impacted the third quarter of 2023 and should be considered in year-over-year profit and margin comparisons as we move forward. Our teams have done a great job to date, and we're confident about our outlook for the balance of the year. We're excited about our future as macro fundamentals continue to support long-term growth and opportunities for our business. Robert? Before we open the call up to questions, let me make a couple of final comments. The macro fundamentals of our business are strong and supportive of growing demand for the foreseeable future. We have a proven, differentiated business model, a disciplined capital allocation approach, and a continuous focus on driving improvements in the business and executing well. We have a strong track record of delivering increased shareholder value, and we're confident we will deliver another strong year of profitable growth. Let me close by expressing my gratitude to our teams for their hard work, dedication, focus on servicing our customers, and keeping each other safe. Thank you for your efforts to consistently execute and drive improvements across our business. With that, operator, we are ready for questions. Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question comes from the line of Stephen Kim with Evercore ISI. Please proceed with your question. Yeah, thanks very much, guys. Appreciate, appreciate all the color. When we look at your results, this quarter, we were a little bit surprised by the overall price realization in the quarter. We thought that might be a bit stronger. I was curious, were there any mix issues at all to call out? And then, and then also, if you look at your guidance, I think you said that, you know, really, the reason for the reduction in the guidance is this commercial industrial segment. And I think you indicated that you thought that that might be up low single digits for the full year. Just wanted to clarify, does that envision a positive year-over-year trend in commercial and industrial in the back half? Or does that trend towards something more like flat to down? Hey, Stephen, this is Rob. So on the first question there around price, the important part to remember there is we are overlapping some price decreases we had in the second quarter of last year on both gutters and spray foam. That accounted for probably about a headwind of about 1% on our overall price for the company. I mean, I think overall, we feel good about the realization of the price increase that happened in the first quarter. Coming into the second quarter, I think that's, you know, ultimately reflected in our gross profit at 31%, while, you know, down 100 basis points year-over-year. You've got to remember the $10 million that we've called out last year around the multifamily. So when you adjust for that, you know, the 31's comparing to a 31.3% last year, so pretty much in line with where we were a year ago. You know, if you look, 31.3% is the highest in our history of the company. I think this is, like, the third time we've ever gotten over 31%. So we feel pretty good about the price realization there. On your question around guidance and the guidance for low single digits on commercial, that is, you know, probably the biggest change in our guidance, is really around some of the choppiness we've seen from a project volume perspective, on both the install and the distribution side of things. We've seen some project delays. We've had some supply chain issues with products like aerogel and mineral wool, and some fiberglass products as well. So, you know, definitely some choppiness there, so we're lowering that. So, you know, you know, we're not breaking down the second half per se, but, you know, it does, if you take that low single digits and kind of back into a second half number, it does imply low single-digit growth for commercial year-over-year in the second half, and it implies, you know, some growth from the first half. So I think that's really an important point, too, is that, you know, we see the second half improving year-over-year in both resi and commercial. We see it improving the prior year as well as to the first half. We just don't see it as improving as much as we had in our original guidance. Yeah, that is very helpful. Appreciate that. Second question related to the margins. You did talk about how strong your margins were, and we definitely recognize that, and that was very encouraging to see. Was curious if you could just elaborate. I think you mentioned in your opening remarks about your outlook reflects, you know, ongoing productivity from your teams. You have, in the past, called out a Special Ops team, which also has been very important in generating productivity. Just want to clarify. Historically, you have not included those, you know, results from the Special Ops team in your guidance. Are you now including it in your guidance for 2024? Yeah, I, I would say it's included in the back half guidance we have here. What we've said in the past is it's not included in that, that long-term EBITDA guide of 22%-27%. Gotcha. Because, you know, that 22%-27%, you know, it—that can really... If you have $10 million of productivity, you know, it's really gonna change that percentage depending on how much your incremental same-branch sales are, right? It could be, you know, 1% on a big sales number, a much lower or a much bigger number on a smaller sales change. So we haven't included in that, but it's definitely included in what we've got included for our guide, the back half of this year. Okay, that's perfect. Thanks so much, guys. Thank you. Our next question comes from the line of Susan Maklari with Goldman Sachs. Please proceed with your question. Thank you. Good morning, everyone. Good morning. Morning. My first question is, you know, you mentioned that there's been some regional shifts in terms of the single-family. It's, it's been a bit uneven, maybe across the different markets. Can you talk about where you're seeing more strength or more weakness, and how that could perhaps come through as you think about the back half? Yeah. Good morning, Susan, this is Robert. So I'll give you, I'll give you both sides. So strength, definitely still Southeast, Carolinas, Florida, Texas, California, even is very strong for us right now. You know, I'd say some weaker spots where we've seen uneven or, to use the term that we use, choppiness. Pacific Northwest would be a good example of that, which if you look at starts and some of the numbers support that, and even if you hear what some of the other, publics have said, support that, and that's as well as the Northeast. And then I'd say if you take an area like Arizona, that's been pretty good. It's kind of a, a city by city in Arizona. So, so definitely seeing some strength. I think, you know, you've seen some of the starts numbers. We think it'll continue to improve as long as we see those starts come out of the ground in some of those slower regions here in the back half. Okay, that's helpful. And then maybe turning to capital allocation, you know, it's nice to see the $500 million or so of buybacks this quarter. Can you just talk about your appetite to continue to use up the $649 million or so that's remaining on the authorization? And any comments with that on the M&A pipeline and how you're thinking about that also as a use of cash? Yeah, I mean, Susan, this is Rob. So, you know, from a capital allocation standpoint, our priorities are unchanged. I mean, M&A remains our number one capital allocation priority. We've had a great 18 months, as Robert talked about on the call a little bit, in terms of the number of deals and the amount of revenue we've added. Our pipeline right now is very healthy, I'd say, as healthy as we've had it in a while, so we feel really good about that moving forward. So as far as buybacks go, you know, we're gonna continue to do what we've done in the past, is prioritize that with our M&A pipeline and be opportunistic moving forward here. Okay. Thank you both for the color, and good luck with everything. Thank you. Thank you. Our next question comes from the line of Ken Zener with Seaport. Please proceed with your question. Morning, everybody. Morning, Ken. Morning, Ken. I wonder if you could comment on what appears not normal, which is the lack of material. You said, I think, that, that might have contributed to some of your, you know, constraints. I'm assuming you're talking about insulation material, I suppose, let's say, spray foam. And then how that seems to, you know, with low volume, realizing you have a gutter, you know, that there's some one-offs, but if materials constrained, you're really not growing that much. How unique is that in your perspective, and why aren't we seeing that in greater pricing if the supply is so tight? Yeah. Good morning, Ken, it's Robert. I'll take the first part on material side of it. So, you know, relative to, you know, availability of material, definitely, you know, fiberglass is still in tight supply, no doubt about it. I would say Q2 was, you know, tighter quarter given maintenance, given some unscheduled downtime from some of the suppliers as well. So I'd say a little more abnormal in the second quarter, probably impacted distribution a little more than in-stock, because in-stock, it, you know, can buy from a third party if need be, to complete work. So probably a little more on the distribution side. You know, if you think about going forward, we expect that to be better in the back half of the year, as well as, you know, some of the alternative materials, given what's happening with some of the builders and codes. So, you know, foam and even some of the loose fill applications that'll be used, we think that does help some in the back half of the year. You know, you've heard us talk about capacities coming on, but that's really going to be more of a 2025 type of an event. And then to Rob's point, I think earlier, but he may add on here on the price. I think we feel good about the price, covering the price. You know, we let some of the slower regions make some price volume decisions, where we talked about, you know, there was some choppiness, but we feel like the teams did a nice job of covering price, and covering any additional expense from, you know, third-party buys, that type of thing. Yeah, no, I think as Ken, this is Rob. So I think Robert hit it on the head there. We feel pretty good about the, you know, the pricing environment. That first price increase, we've pushed along, well, it reflected in our margins. As a result, we're working through the second fiberglass price increase right now. So, you know, more to come on that the back half of this year. Great. I wonder if you guys could put the word choppiness, you know, given your perspective in the industry. Robert, your what choppiness means within the context of, you know, new home inventory, whether on units or month supply is higher than normal. But I assume that's most evident in your choppy markets. Can you kind of talk about how that's playing out when you have, right, all these homes under construction, nine months supply as of last, you know, month from the census data? Can you just put that in context to how you think that's going to kind of play out? Yeah, Ken, so let me start with kind of the definition, and I'm sure Rob will add on here as well, talking about some of the units and the numbers. So, you know, relative to that, I gave a couple examples on an earlier question. So let me just pick on the Pacific Northwest as an example. So you see the starts, you see the completions, you just don't see the work coming out of the ground yet. So builders are generally positive, especially production builders, generally positive for the back half. It's just not coming to fruition. Now, you go to another example, maybe like a Southern California or Florida, you know, folks are continuing to build, even though they may have seen a, you know, some slower sales in, like, May or June or potentially in July. They're still building in some of those areas. So that's choppiness. That's why we refer to it by region, because it's a little different, as things play out region to region. And you're right, we have that footprint where we get that perspective that a lot of folks maybe don't get. So that's kind of the definition and how we see it. Rob, you want to add on anything? Yeah, I mean, I think Robert said it well there. I think, you know, when we talk about choppiness, you know, it's really about we're seeing strong demand in certain markets and weaker in others. And as he mentioned, you know, some of the starts data you can see supports that in parts of the country where things aren't moving quite as quickly right now. And we're seeing the same, you know, the same phenomenon on the commercial side as well. So while overall, you know, we're still seeing growth, you know, from a volume perspective, you know, this quarter, the first quarter or this second quarter here of this year, was the first quarter that we've seen our same-branch residential sales grow, since the first quarter of last year. So things are trending up, but just not as quickly as we had originally anticipated in our guidance to start the year. Thank you very much. Thank you. Our next question comes from the line of Phil Ng with Jefferies. Please proceed with your question. Hey, good morning. This is Maggie on for Phil. I guess going off of that last question, you know, we've seen such a strong improvement in single-family starts year to date. So I guess, where's the disconnect between that and your volumes? And when do you anticipate, you know, that improvement starting to flow through? And are there any, you know, considerations? I know the supply constraints have been tempering volumes, but, you know, anything else, extended cycle times that we should be mindful of that would, you know, extend that lag between starts and your volumes? Yeah, Maggie, this is Rob. So I'd say, you know, if, if you look at the first half of this year, you know, starts are up, and particularly on the single-family starts are up, right? Obviously, multifamily is not, but single-family is up, I think, about 16% year to date. Completions are up 1%, because you got to remember the, you know, the first half of last year, we had the, the heavy backlog, you know, helping support our work. So, you know, the comp, the first half was tougher. Our same-branch sales were up in that, you know, we were kind of flattish, up 1% on the TruTeam side the first half of this year. So we're, we're pretty much in line with completions. Now, to your point, that improvement in starts-... Should make its way into the third quarter here, third and fourth quarter. And we should see some improvement in completions, assuming that comes through. But like Robert said, it's really various stories across the country in terms of how quickly that's flowing through. So we've got that baked into our guidance. We do have volumes improving the second half of the year, but you know, we have tempered that down a little bit based on what we've seen here late in the second quarter and even here early third quarter. And Maggie, I think you can—if you look at some of the public builders' comments the past few weeks, and what—I think they're using the exact same word, probably, as choppy in different parts of the country, you know, whether it be, you know, the higher interest rates may have, you know, spooked some people in the second quarter or something like that. So it's just in certain regions that slow we're seeing them come out of the ground. Although to Rob's point, you'd expect that momentum of what we saw carrying into the back half of the year. Okay. Okay, that's super helpful. And then, on rates, you know, it, it's a more recent development, but potential rate cuts coming later this year. Curious if you, you know, had conversations both with your residential customers and on the commercial side, you know, how they're anticipating the impact of that potentially flowing through later this year or in 2025? Yeah, definitely conversations for sure, Maggie. I think if you, if you think about that and, you know, we'll see what happens in September, if it's more of an October, November. It's, it's probably, I would say, on the rate side, my perspective, a great momentum for 2025, right? So if you think about that cut happens, now, you know, the consumer sentiment starts getting impacted in a positive way, and you think about lag times, it should, you know, you would think, get 2025 off to a, to a great start and a great trend. All right, great. Our next question comes from the line of Michael Rehaut with JP Morgan. Please proceed with your question. Hi, everyone, this is Andrew Azzi in for Mike. I appreciate you taking my questions. I just wanted to dive into maybe what have productivity and other like initiatives contributed to your profitability year to date versus maybe last year? And how can we think about these going forward? Yeah, this is Rob. So I'd say, I mean, it's not a number we break out, but it's a huge part of our story. You know, Robert's talked about it in the past on the call about what our Special Ops teams do in terms of working with our bottom-performing branches. You know, with 400 branches across our network of install and distribution, 400+ branches, you know, there's always a bottom quartile to work on and lots of opportunities. So, as we talk about, you know, margins moving forward and our margins in the past, right? When we typically outshoot our targeted incrementals of 22-27, and a lot of that is because of the work of that team. We're always striving to do that, but it's not a number we break out on a quarterly basis. But if you're looking for a little bit of color around the initiative. So, you know, if you look at the distribution margins, which we would say are doing really well, you know, definitely the Special Ops team has definitely been focused in some of our mechanical businesses, where we can optimize, you know, logistics, some of our footprint and stuff, and also relative to just, you know, distribution productivity, sales productivity. So we've definitely seen it, and we see it, you know, showing in definitely our distribution margins, and that's been an area that we continue to work both sides of the business. But I know specific things that we saw benefit from in our distribution business here in the first half of 2024. Got it. Makes sense. I appreciate that. And then maybe how do you view kind of the opportunity on margins over the next one to two years? You know, maybe hypothetically, if the market were to slow alongside a weaker macro, could we expect decrementals to look similar to incrementals, or are there kind of offsetting factors considered? Yeah, I mean, it's one of the great things about our model, right? We're a high variable cost model, where, you know, in a slowdown situation, you know, for us, taking out costs. You know, we gotta slow down the material purchases, that's for sure. And then, you know, labor is by far the biggest chunk of our costs. So we, you know, when it comes to a slowdown scenario, it's about looking at our labor structure. And it all comes down to how long do we think the slowdown is gonna last, right? Because, you know, we've talked about this in the past when there's been fear of slowdowns, that, hey, we're gonna hold on to labor, in a situation like that, where we think it's gonna be short-lived, because we wanna have the labor when things come back. Obviously, if we see it as a more long-term downturn, there'll have to be more reductions we make to the business. But, you know, it's something we've been through before, back when COVID hit, it was something we, you know, worked through. Luckily, for us, our markets came back pretty strong, pretty quickly after that. But initially, it was something we thought we were gonna have to work through. But over the long term, to answer your question, we would be targeting something in that similar 22-27 type range for a decremental. It's just, it's gonna be a little choppier, to reuse that word, I guess, but it's gonna be a little bumpy as you go, just because, you know, there are fixed costs that come along the way. They're gonna come out in chunks rather than variably over time. Got it. That's very helpful. I'll pass it on. Thank you so much. Our next question comes from the line of Jeffrey Stevenson with Loop Capital. Please proceed with your question. Hi, thanks for taking my questions today. ...So at a high level, can you talk about the variance between large production and independent builder growth in your second quarter installation volumes, and whether you expect that trend to widen as we move throughout the back half, as first half housing starts show up more meaningfully in the results moving forward? Yeah, Jeff, you know, I'd say, you know, similar to the what a lot of the industry data shows, we see, you know, growth with the big builders as they've continued to take share, obviously, with their ability to do rate buydowns. You know, that's been a huge advantage to them in the market. And, you know, we've grown with them along the way. Okay, great. And then, you know, you talked about kind of your heavy commercial work and some of the projects going on where you've seen delays, but on the light commercial side, can you give any more color on, you know, how demand trended in the second quarter and whether you've experienced any slowdown in bidding activity during the quarter? Yeah. Morning, Jeff, it's Robert. So look, you know, we definitely saw some project delays, light and heavy commercial both. Overall, we'd say light, light commercial did a little better, better than heavy commercial. And then, you know, it does follow residential trends. So I think we saw some, you know, nicer performance on our light commercial side. And I think, you know, given some of the share position that we've taken there, and as we look forward, we'd say bidding activity is, is strong, both light and heavy commercial. I think it's just taken some momentum on these project delays. And I think, as you heard us say in the prepared remarks, no cancellations, which is the critical, critical thing to look at and, and to, categorize as well. So this is, as we said, this is timing more than anything else. Okay, great. Thank you. Thank you. As a reminder, if you would like to ask a question, press star one on your telephone keypad. Our next question comes from the line of Trey Grooms with Stephens. Please proceed with your question. Good morning. This is Noah Merkousko on for Trey. Thanks for taking my questions. Morning, Noah. So first, I wanted to touch on multifamily. I think if I heard correctly, you said, the current backlog will carry you into 2025. I think that's been, you know, pretty consistent about what you've said, you know, your expectations for, for 2024. So is that to mean, as we look at the back half of the year, that volumes for multifamily won't be down year-over-year? I guess just any kind of clear directional sort of thoughts on how multifamily looks in the back half. And then the second part of the question is, if it is the case that we're not really seeing the volume declines yet, despite, you know, starts for multifamily being down quite significantly, does that push the headwind to 2025? Just any kind of thoughts on what that headwind could look like? Yeah, Noah, this is Rob. So, you know, I'd say, you know, the multifamily, it's gonna play out, you know, region by region. So we could see some volume slowness near the back half of the year in certain parts of the country. But overall, we feel pretty good about it. I mean, when we look at our backlog on multifamily right now, we've certainly eaten into it this year, but it's, you know, it's about 18% lower than it was a year ago at this time, right? And with more than a half year's worth of sales in there. So if, you know, that stuff all comes through, we'll, we should be looking pretty good the back half of this year. Again, you deal with project delays and, you know, timing in different markets, so we'll have to see how that plays out. But, we haven't baked a significant decline in multifamily into our guidance. Got it. To the second part of your question, I mean, the answer is yes, it does push into, into 2025 ultimately, right? We will eventually, you know, experience the slowdown we've seen on the starts side. I think starts are down 35% year to date. So that'll eventually come. It's just important to remember that for us, you know, it's a, a smaller piece of what we deal with, smaller take per unit. It's about 15% of our, of our installation sales. So, you know, hopefully, with a healthy single-family environment, we should be able to offset that. Yeah, the take per unit is so much more on the single-family unit. So as that shifts, it's less, to Rob's point, less of an impact for us. Got it. That, that makes sense. And then for my follow-up, you know, you'd called out spray foam and gutter pricing as a headwind in the quarter. Similar question, just how should we be thinking about that in the back half of the year? Will that continue to be a headwind to pricing? No, those occurred in the second quarter of last year, so those should roll off the back half. And, you know, as a result, we should see about a 1% uplift in pricing from where we are today. All right, great. That's helpful. Good luck with the rest of the year. Thank you. We have no further questions at this time. I'd now like to turn the floor back over to management for closing comments. Thanks for joining us this morning. We look forward to talking with you in our Q3 call. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.