Full Transcript: Trex Co Q2 2026 Earnings Call

Trex Co (NYSE: TREX ) held its second-quarter earnings conference call on Tuesday.

Below is the complete transcript from the call.

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For comprehensive financial data and transcripts, visit Access the full call at Summary Trex Co reported a strong second quarter with net sales of $418 million, exceeding expectations and showing an 8% year-over-year growth, driven by broad-based strength across products and channels.

The company raised its full-year guidance for 2026, with expectations for a gross margin of approximately 38%, up from 37.5%, due to improved capacity utilization and the ramp-up of the Little Rock facility.

Strategic initiatives included increased investments in branding and organizational capabilities, as well as a focus on expanding the company's wood conversion strategy, particularly in the Sun Belt region.

Trex Co is accelerating the production ramp-up at its Little Rock facility, which will serve as a key driver for future growth, especially in wood conversion, positioning the company closer to key growth markets.

The company plans to repurchase up to an additional $150 million of shares in 2026, reflecting confidence in its long-term outlook and objectives, including achieving $2 billion in annual sales by 2030.

Management highlighted robust free cash flow generation, debt reduction, and enhancements to its North American distribution network as part of optimizing channels for growth.

The company anticipates ongoing marketing and talent investments to support sustained growth, with SG&A expenses expected to be approximately 18% of sales for the year.

Full Transcript Lee Coker, Vice President of Corporate Development and Investor Relations Results and Outlook.

With us on the call are Adam Zambanini, President and Chief Executive Officer, and Prith Gandhi, Senior Vice President and Chief Financial Officer.

The Company issued a press release earlier this morning containing financial results for the second quarter 2026, a copy of which is available on the Company's website.

This conference call is also being webcast and will be available on the Investor Relations page of the Company's website for 30 days.

Before we begin, let me remind everyone that statements on this call regarding the Company's expected future performance and conditions constitute forward-looking statements within the meaning of federal securities laws.

These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements.

For a discussion of such risks and uncertainties, please see our most recent Form 10-K and Form 10-Q, as well as our other filings with the SEC.

Additionally, non-GAAP financial measures will be referenced in this call.

A reconciliation of these measures to the comparable GAAP financial measure can be found in our earnings press release at trex.com.

The Company expressly disclaims any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.

I will now turn the call over to Adam.

Adam Zambanini, President and Chief Executive Officer Thank you, Lee, and good morning, everyone.

As Lee mentioned, we pre-released our second quarter net sales and adjusted EBITDA results earlier this month, so I won't spend much time recapping the numbers.

The key takeaway is straightforward.

We delivered an excellent quarter with net sales well above expectations, driven by strong execution and strengthening of end market demand.

Importantly, that growth was broad-based across our product portfolio, channels, and price points.

We were particularly encouraged by the momentum we saw as the quarter progressed.

Demand accelerated through May and June, supported by strong sell-through activity across the portfolio, and those trends have continued into the third quarter.

That performance, combined with our strong execution and improved visibility, gave us the confidence to raise our full year guidance and increase our planned share repurchases for the remainder of the year.

We also generated strong free cash flow during the quarter, allowing us to reduce debt and return capital to the shareholders through share repurchases, reflecting our confidence in both the business and our long-term outlook.

We plan to repurchase up to an additional $150 million of shares during the balance of the year.

While our sales performance was exceptionally strong, profitability reflected the pace at which demand accelerated during the quarter, along with several strategic choices that supported our long-term growth objectives.

First, growth was particularly strong in railing and our entry-level decking products.

We view this as a positive development, underscoring the growing consumer engagement across the product portfolio and successful execution of our wood conversion strategy.

Although the mix moderated consolidated gross margin, it meaningfully accelerated revenue growth and enhances the scale of our long-term value creation opportunity.

Second, we continued investing in branding, talent, and organizational capabilities consistent with our strategy and our expectations to spend approximately 18% of sales on SG&A this year.