PGTI Reports Third Quarter 2022 Results and Updates Full-Year 2022 Guidance

PGT Innovations, Inc. PGTI, a national leader in premium windows and doors, including impact-resistant products, garage doors, and products designed to unify indoor/outdoor living spaces, today announced financial results for its third quarter ended October 1, 2022.

Financial Highlights for Third Quarter 2022

(All results reflect comparison to prior-year period; Cash on hand is compared to prior-year end)

• Net sales in the third quarter totaled $386 million, an increase of 28 percent (includes organic growth of 17 percent).
• Net income in the third quarter was $30 million, compared to a net loss of $5 million.
• Adjusted net income* in the third quarter was $33 million, an increase of 111 percent.
• Adjusted EBITDA* in the third quarter was $68 million, an increase of 58 percent.
• Net income attributable to common shareholders per diluted share in the third quarter was $0.50, compared to a net loss of $0.11.
• Adjusted net income per diluted share* in the third quarter was $0.55, compared to $0.26.
• Cash at the end of the third quarter was $219 million, an increase of 128 percent.

Updated Fiscal Year 2022 Guidance

• Net sales in the range of $1.460 billion to $1.490 billion.
• Adjusted EBITDA* in the range of $245 million to $255 million.

* Adjusted net income, Adjusted net income per diluted share and Adjusted EBITDA are non-GAAP measures. Please see "Use of Non-GAAP Financial Measures" below for more information.

"PGT Innovations delivered a strong third quarter. Net sales increased 28 percent to $386 million, year-over-year despite the impact of Hurricane Ian, which made landfall on September 28 near our headquarters in Venice, Florida," said Jeff Jackson, President and Chief Executive Officer. "While our facilities were not damaged, storm-related disruptions caused approximately $12 million of third-quarter sales to be deferred."

"Despite the hurricane and other economic headwinds, including rising interest rates and rising inflation," continued Jackson, "total organic revenue growth of 17 percent year-over-year was comprised of a 38 percent increase in our Western region and 13 percent improvement in our Southeast region. Additionally, Anlin Windows & Doors, which we acquired in the fourth quarter of last year, contributed $35 million of revenue. Our ongoing focus on operational improvements, along with pricing actions to offset rising costs, helped expand gross margin by 410 basis points to 39 percent."

"Subsequent to the end of the quarter, we acquired Martin Door, which expanded our product lines in the adjacent garage door market category," added Jackson. "Martin enables us to leverage our extensive knowledge of protecting the envelope of homes and buildings as we look to expand geographically and into desirable adjacent markets. Martin is strategically positioned to capitalize on opportunities within our dealer, distributor, builder, and direct-to-consumer channels across the country, and its customized products and efficient cost structure generate strong margins and cash flow conversion. Just as important, Martin is a perfect cultural fit with our PGT Innovations team because of its focus on exceptional quality, safety and innovation."

"I am extremely proud of our team for assisting communities affected by Hurricane Ian and for delivering high-quality products and services to our customers during these challenging circumstances," added Jackson. "PGT Innovations' impact-resistant products are specifically designed to protect life and property against powerful storms, such as the Category 4 Hurricane Ian. Our industry-leading products are designed and tested to meet some of the most stringent standards in the nation," concluded Jackson.

"In the third quarter of 2022, we generated strong cash flow, ending the period with a cash balance of $219 million," said John Kunz, Senior Vice President and Chief Financial Officer. "After the quarter's end, PGT Innovations entered into a new five-year $250 million revolving credit facility, which was used to fund the Martin transaction along with cash on hand. We also extended maturities to create more liquidity to support PGT Innovations' continued growth."

"Our previous fiscal year 2022 guidance did not contemplate the impacts of Hurricane Ian, the previously disclosed cybersecurity incident, or our acquisition of Martin Door. Our facilities did not sustain damage from the storm, but our employees could not safely travel to work, limiting our ability to produce in October. Additionally, the cybersecurity incident we experienced on November 5th impacted our ability to process orders and produce in November. As such, we are updating fiscal year 2022 guidance for net sales in the range of $1.460 billion to $1.490 billion and for Adjusted EBITDA in the range of $245 million to $255 million," concluded Kunz.

Conference Call

PGT Innovations will host a conference call today at 10:30 a.m. The conference call will be available at the same time through the Investor Relations section of the PGT Innovations, Inc. website, http://ir.pgtinnovations.com/events.cfm.

To participate in the teleconference, kindly dial into the call about 10 minutes before the start time: 833-316-0547 (U.S. toll-free) and 412-317-5728 (International). A replay of the call will be available within approximately one hour after the scheduled end of the call on November 10, 2022, through approximately 12:30 p.m. on November 17, 2022. To access the replay, dial 877-344-7529 (U.S. Only toll-free), 855-669-9658 (Canada Only toll-free) and 412-317-0088 (International) and refer to pass code 6872862. Other international replay dial-in numbers can be obtained at: https://services.choruscall.com/ccforms/replay.html

You may join the conference online by using the following link:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=ffEIxuAB.

About PGT Innovations, Inc.

PGT Innovations manufactures and supplies premium windows and doors. Its highly engineered and technically advanced products can withstand some of the toughest weather conditions on Earth and are revolutionizing the way people live by unifying indoor and outdoor living spaces.

With our recent acquisition of Martin Door, we now manufacture and distribute overhead garage doors. Based in Salt Lake City, Utah, Martin Door is a trusted name, known by architects, builders and contractors throughout the West for manufacturing some of the highest-quality overhead garage doors for residential and commercial applications in the industry.

PGT Innovations creates value through deep customer relationships, understanding the needs of the markets it serves, and developing category-defining products. PGT Innovations is also the nation's largest manufacturer of impact-resistant windows and doors and a leader in its primary markets.

The PGT Innovations' family of brands include CGI®, PGT® Custom Windows and Doors, WinDoor®, Western Window Systems, Anlin Windows & Doors, Eze-Breeze®, NewSouth Window Solutions, Martin Door, and a 75 percent ownership stake in Eco Window Systems®. The company's brands, in their respective markets, are a preferred choice of architects, builders, and homeowners throughout North America, Hawaii and the Caribbean. Its high-quality products are available in custom and standard sizes with massive dimensions that allow for unlimited design possibilities in residential, multi-family, and commercial projects. For additional information, visit https://pgtinnovations.com/.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "assume," "believe," "could," "estimate," "expect," "guidance," "intend," "many," "positioned," "potential," "project," "think," "should," "target," "will," "would" and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding our acquisitions of Anlin Windows & Doors ("Anlin"), and Martin Door Holdings, Inc. ("Martin"); pricing actions benefiting margins; effects of Hurricane Ian and other economic headwinds such as increasing interest rates and rising inflation; improvement of our operations and business integration; and our net sales and Adjusted EBITDA guidance.

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:

• the impact of the COVID-19 pandemic (the "COVID-19 pandemic" or "Pandemic") and related measures taken by governmental or regulatory authorities to combat the Pandemic, including the impact of the Pandemic and these measures on the economies and demand for our products in the states where we sell them, and on our customers, suppliers, labor force, business, operations and financial performance;
• unpredictable weather and macroeconomic factors that may negatively impact the repair and remodel and new construction markets and the construction industry generally, especially in the state of Florida and the western United States, where the substantial portion of our sales are currently generated, and in the U.S. generally;
• changes in raw material prices, especially for aluminum, glass and vinyl, including, price increases due to the implementation of tariffs and other trade-related restrictions, Pandemic-related supply chain interruptions, or interruptions from the conflict in Ukraine;
• our dependence on a limited number of suppliers for certain of our key materials;
• our dependence on our impact-resistant product lines, which increased with the acquisition of Eco Enterprises, LLC ("Eco"), and contemporary indoor/outdoor window and door systems, and on consumer preferences for those types and styles of products;
• the effects of increased expenses or unanticipated liabilities incurred as a result of, or due to activities related to, our recent acquisitions, including our acquisitions of Martin, Anlin and Eco;
• our level of indebtedness, which increased in connection with our recent acquisitions, including our acquisitions of Martin, Anlin and Eco;
• increases in credit losses from obligations owed to us by our customers in the event of a downturn in the home repair and remodel or new home construction channels in our core markets and our inability to collect such obligations from such customers;
• the risks that the anticipated cost savings, synergies, revenue enhancement strategies and other benefits expected from our acquisitions of Martin, Anlin and Eco may not be fully realized or may take longer to realize than expected or that our actual integration costs may exceed our estimates;
• increases in transportation costs, including increases in fuel prices;
• our dependence on our limited number of geographically concentrated manufacturing facilities, which increased further due to our acquisition of Eco;
• sales fluctuations to and changes in our relationships with key customers;
• federal, state and local laws and regulations, including unfavorable changes in local building codes and environmental and energy code regulations;
• risks associated with our information technology systems, including cybersecurity-related risks, such as unauthorized intrusions into our systems by "hackers" and theft of data and information from our systems, and the risks that our information technology systems do not function as intended or experience temporary or long-term failures to perform as intended;
• product liability and warranty claims brought against us;
• in addition to our acquisitions of Martin, Anlin and Eco, our ability to successfully integrate businesses we may acquire in the future, or that any business we acquire may not perform as we expected when we acquired it; and
• the other risks and uncertainties discussed under "Risk Factors" in Part I, Item 1A of our Annual Report on Form 10-K/A for the year ended January 1, 2022, and our other filings with the Securities and Exchange Commission.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Use of Non-GAAP Financial Measures

This press release and the financial schedules include financial measures and terms not calculated in accordance with U.S. generally accepted accounting principles (GAAP). Management believes that presentation of non-GAAP measures such as Adjusted net income, Adjusted net income per share, and Adjusted EBITDA provides investors and analysts with an alternative method for assessing our operating results in a manner that enables investors and analysts to more thoroughly evaluate our current performance compared to past performance. However, these measures do not provide a complete picture of our operations. Management also believes these non-GAAP measures provide investors with a better baseline for assessing our future earnings potential. The non-GAAP measures included in this press release are provided to give investors access to types of measures that we use in analyzing our results, and for internal planning and forecasting purposes.

Adjusted net income consists of GAAP net income adjusted for the items included in the accompanying reconciliation. Adjusted net income per share consists of GAAP net income per share adjusted for the items included in the accompanying reconciliation.

Adjusted EBITDA consists of net income, adjusted for the items included in the accompanying reconciliation. We believe that Adjusted EBITDA provides useful information to investors and analysts about the Company's performance because they eliminate the effects of period-to-period changes in taxes, costs associated with capital investments and interest expense. Adjusted EBITDA does not give effect to the cash the Company must use to service its debt or pay its income taxes and thus does not reflect the actual funds generated from operations or available for capital investments.

Our calculations of Adjusted net income and Adjusted net income per share, and Adjusted EBITDA are not necessarily comparable to calculations performed by other companies and reported as similarly titled measures. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP but should not be considered a substitute for or superior to GAAP measures. Schedules that reconcile Adjusted net income, Adjusted net income per share, and Adjusted EBITDA to GAAP net income are included in the financial schedules accompanying this release.

We are not able to provide a reconciliation of projected Adjusted EBITDA to the most directly comparable expected GAAP results due to the unknown effect, timing and potential significance of the effects of legal matters, tax considerations, and income and expense from changes in fair value of contingent consideration from acquisitions. Expenses associated with legal matters, tax consequences, and income and expense from changes in fair value of contingent consideration from acquisitions have in the past, and may in the future, significantly affect GAAP results in a particular period.

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