Jennifer Pasquino - Builders FirstSource, Inc. M. Chad Crow - Builders FirstSource, Inc. Peter Jackson - Builders FirstSource, Inc.

Nishu Sood - Deutsche Bank Securities, Inc. Steven Ramsey - Thompson Research Group LLC Matt McCall - Seaport Global Securities LLC Will Randow - Citigroup Global Markets, Inc. Jay McCanless - Wedbush Securities, Inc. Blake Hirschman - Stephens, Inc. Marshall Mentz - Barclays Capital, Inc. Lee Nalley - SunTrust Robinson Humphrey Min Cho - B. Riley FBR, Inc.

Good morning, and welcome to Builders FirstSource's First Quarter 2018 Earnings Conference Call. Today's conference is being recorded and will be archived at www.bldr.com. It is now my pleasure to introduce Ms. Jennifer Pasquino, Senior Vice President, Investor Relations. Please go ahead, ma'am. Jennifer Pasquino - Builders FirstSource, Inc.: Thank you. Good morning, and welcome to the Builders FirstSource first quarter 2018 earnings conference call. Joining me on the call today is Chad Crow, Chief Executive Officer; and Peter Jackson, Chief Financial Officer. A copy of the slide presentation referenced on this call is available on the Investor Relations section of the Builders FirstSource website at bldr.com. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow. Any reproduction of this call, in whole or in part, is not permitted without a prior written authorization of Builders FirstSource. And as a reminder, this conference call is being recorded today, May 10, 2018. Builders FirstSource issued a press release after the market closed yesterday. If you don't have a copy, you can find it on our website at bldr.com. Before we begin, I would like to remind you that during the course of this conference call, we may make statements concerning the company's future prospects, financial results, business strategies, and industry trends. Such statements are considered forward-looking under the Private Securities Litigation Reform Act of 1995 and are subject to certain risks and uncertainties, which could cause actual results to differ materially from expectations. Please refer to our most recent Form 10-K filed with the SEC and other reports filed with the SEC for more information on those risks. The company undertakes no obligation to publicly update or revise any forward-looking statements. The company will discuss adjusted results on this call. We've provided a reconciliation of non-GAAP financial measures to the GAAP equivalents in our earnings press release and detailed explanation of non-GAAP financial measures in our Form 8-K filed yesterday, both are available on our website. At this time, it is my pleasure to turn the call over to Mr. Chad Crow. M. Chad Crow - Builders FirstSource, Inc.: Thank you, Jen. Good morning, everyone. Welcome to our first quarter earnings call. I will start with a brief update on our first quarter performance as well as an update on our longer-term strategic growth initiatives. Then, I will turn the call over to Peter, who will discuss our financial results in more detail. After our closing comments regarding our outlook, we will be happy to take your questions. I'll begin on slide 4. I continue to be impressed by the execution of our associates capturing the benefits of a growing market in a rising price environment, successfully managing through challenges, including commodity price inflation and weather and continuing to focus on improving profitability through cost discipline and strategic growth in value-added products. Our sales for the quarter of $1.7 billion represent a healthy increase in sales per day of 12.7% over 2018 (sic) [2017] (3:08). This growth was benefited by commodity price inflation of approximately 9.6%. Sales volume per day grew approximately 3.8% in the single family homebuilding end market and approximately 2.8% in the repair and remodeling and other end market. Turning to slide 5, we continued to see rapidly rising commodity prices. Framing lumber and sheet good prices increased 13% and 24%, respectively in the first quarter alone. As we managed through this period of commodity inflation, our short-term pricing agreements caused gross profit margin compression. However, I'm again very pleased with our organization's response in this to the challenge and ability to mitigate the impact on EBITDA margin through disciplined cost management. In the quarter, we have also begun to realize the positive year-over-year benefit of higher lumber and sheet good prices on our total gross profit and EBITDA dollars. Our increased investments in manufacturing capacity also continue to pay off with 11% sales per day growth in manufactured products and 9% growth in windows, doors and millwork in the first quarter faster than the overall growth of the residential housing market. Consistent with our long-term strategic plans we have previously shared with you, we are continuing our expansion of manufacturing and value-added capacity this year, including three new truss plants, nine new lines in existing plants, one new millwork facility and capacity additions to many more. We are committed to grow these higher margin products faster than the overall housing market, capitalizing on the opportunity to serve fundamental customer needs by adding to our network of 57 manufacturing facilities strategically located across the country. With the continuing labor challenges being faced by our customers, demand for these labor-saving products should continue to rise as homebuilders look for ways to build homes more efficiently. Moving on to slide 6, with an overview of the macro housing market, the outlook for new residential housing demand and activity remains very bright. The U.S. homebuilding industry has now reached 1.2 million annual starts with approximately 860,000 of those being single family starts. This remains approximately 20% below the long-term historic average and is just now reaching levels we have seen in previous recessionary troughs. Demographic trends, market demand, activity levels and underlying economic conditions remain very supportive. We are anticipating mid to high single-digit growth in the single family homebuilding end market this year, a solid environment to continue executing our strategic plans with multiple years of expected growth ahead of us. Turning to slide 7, our 2018 priorities dovetail into our longer-term strategic growth initiatives. We will continue to invest in our sales force and our manufacturing facility expansion initiatives. These growth platforms provide us significant ongoing opportunities to increase our market share and increase the penetration of our higher margin products. They are delivering results and we expect these ongoing high return investments to continue over the years ahead. Our scale enables us to easily absorb the initial cost of these additions, while positioning our business for accelerated growth. We've also made good progress implementing our operational excellence initiatives, which are focused on creating substantial, strategic and economic value for the organization through efficiencies and customer service advancements. Our continuing focus on cash generation also remains a priority, allowing us to invest in these strategic growth and value creation initiatives, while continuing to deleverage our balance sheet. We expect to generate $170 million to $190 million of net free cash flow in 2018 after funding over $120 million of capital investments and expect to reduce our leverage ratio to 3.5 times or lower by year end. Finally, we are committed to continuing to attract, train and retain the best people in the industry and to developing our future leaders throughout the organization. We have increased our college recruiting and sales and management development programs to grow our own talent and leaders for the future. Moving to slide 8, we are on track in executing our plans to accelerate growth, further expand profitability and create meaningful shareholder value. Believing the housing market will return to historical building levels over the next several years, the strength of our core business along with our operational excellence initiatives and strategic growth investments should enable us to double 2016 EBITDA, which is our baseline year and to generate over $1 billion in free cash flow after capital investments and deliver an EPS between $3 and $3.50 within the next four to five years. We're well-positioned to continue to deliver in the current environment as well as benefit from continued market growth as our initiatives underway position us for above market growth, expanding profit margins and enhance free cash flow, all of which are based on our strategic plan that balances cash generation, high return reinvestment opportunities and ongoing debt reduction to achieve our leverage target of 2.5 to 3 (sic) [3.5] (8:14) times EBITDA. Turning to page 9, I would like to provide a bit more detail on our specific growth initiatives. Leveraging our existing core business strengths, including our national footprint, unmatched scale and manufacturing capability and best-in-class sales force, we are confident that our plans will enable us to capitalize on growth in the residential housing market to generate an incremental $250 million to $280 million in EBITDA. We call this core growth. In addition to this core growth, we will continue to expand our national manufacturing footprint and capabilities to grow our higher margin value-added products faster than the overall market over the next several years. Our plans call for investing in 17 new truss and 8 millwork and door facilities over the next four years, including the 4 facilities underway this year. Expanding our national footprint to serve a number of markets that do not currently have adequate access to these high margin products and where we see opportunities to serve the needs of our customers. Our strategic plan further includes a set of operational excellence efficiency initiatives across our organization, including distribution and logistics, pricing and margin optimization, back office efficiencies and system enhancements that are expected to contribute between $65 million and $75 million in incremental annual EBITDA once fully implemented. We are on target with our implementation plans and have made good progress this quarter rolling out several projects. Our delivery and dispatch management project is underway with the system rolled out to 30 locations in the first quarter and another 60 locations scheduled for the balance of 2018. This system links with our delivery fleet's black box technology for more efficient fleet management, driver safety, DOT compliance and delivery optimization. We also rolled out the first phase of our data analytics reporting tool in March, an enterprise analytics solution to enable more efficient operations and cost management. These projects, when leveraged across our 402 locations, should offer significant profit margin expansion, further differentiation of our service, and increase connectivity with our customers providing economic and strategic value that is unrivaled by our smaller competitors. I will now turn the call over to Peter, who will review our financial results in more detail. Peter Jackson - Builders FirstSource, Inc.: Thanks, Chad. Good morning, everyone. As a reminder, we have included adjusted figures to normalize for one-time integration, closure and other costs. On slide 11, you can see we had one fewer sales days in the first quarter of 2018 than the prior year, so I will speak to our results on a sales per day basis. We reported net sales of $1.7 billion, a 12.7% increase compared to the first quarter of 2017, including an estimated 9.6% benefit from commodity price inflation. Despite the impacts of weather-related facility closures on our company's sales numbers and a number of markets during the quarter, we estimate that our underlying sales volume were approximately 3.8% in the single family new residential homebuilding end market and 2.8% in the repair and remodel and other end market. Gross margin of $411 million in the first quarter of 2018 increased by $34.9 million or 9.3% over the first quarter of 2017. Our gross margin percentage was 24.2%, down 30 basis points from 24.5% in the first quarter of 2017 and flat sequentially from the fourth quarter. The margin percentage decrease on a year-over-year basis was attributable to rapid increases in commodity prices. Framing lumber and sheet good prices increased 13% and 24% from year end 2017, respectively. As we have discussed in prior calls, commodity inflation can cause short-term gross margin percentage compression when prices are rising and margin percentage expansion when prices are falling due to the short-term pricing commitments, we provide customers versus the volatility of the commodity markets. Additionally, higher dollar sales in commodity products had a negative mix impact on the gross margin percentage. These price fluctuations caused some ongoing short-term gross profit margin compression. But, I'm pleased with our team's ability to mitigate the impact on our EBITDA margin through continued cost discipline and strong growth in high margin products. Furthermore, in the quarter through the combination of our team's execution and sustained higher commodity product prices, we are beginning to realize the positive benefits in EBITDA dollars on a year-over-year basis. As commodity prices stabilize, the company should further benefit from these higher commodity prices, enhancing our go-forward profitability. Our SG&A as a percentage of sales decreased by 80 basis points on a year-over-year basis. This reduction was largely driven by ongoing cost discipline and operating leverage achieved, even while absorbing the costs of our investments in growth and operational initiatives, including additional sales associates, new facilities and start-up investments in our operational excellence programs. Additionally, we realized this improvement despite lapping a $4.2 million one-time decrease in insurance and benefits expense that we reported in the first quarter of 2017. We do not expect this insurance variance to repeat the balance of the year. Adjusted interest expense for the quarter was $26.7 million compared to adjusted interest expense of $33.8 million in 2017. The $7.1 million reduction was largely due to multiple transactions the company executed in 2017 to lower our go-forward cash interest expense, to extend our maturity profile, and to further strengthen our capital structure. Adjusted net income for the quarter was $27.6 million or $0.24 per diluted share compared to adjusted net income of $12.1 million or $0.11 per diluted share in the first quarter of 2017. The year-over-year increase of $15.5 million or 128% was primarily driven by strong revenue growth, ongoing cost discipline and lower interest expense achieved through our refinancing actions. First quarter adjusted EBITDA grew $6.5 million or 8.6% to $82.6 million. The year-over-year improvement was largely driven by strong revenue growth, operating leverage and disciplined cost management, partially offset by the impact of commodity inflation on gross margin, the initial cost of the investments we are making in our strategic growth initiatives and the previously mentioned one-time decrease in insurance and benefits cost recognized in the prior year's first quarter. Additionally, we are beginning to realize the positive benefits in EBITDA dollars from a combination of our team's execution and higher lumber prices on a year-over-year basis. As commodity prices stabilize, we expect to further benefit from these higher prices, enhancing our go-forward profitability. Turning to slide 12, we expect our free cash flow generation to be utilized to continue our balanced investments and our strategic investments and continuing debt reduction. We believe this will be supported by EBITDA growth and our continuing focus on working capital efficiency, which is estimated to run approximately 9% to 10% of incremental sales. We expect to increase investment in our business through capital expenditures at approximately 1.6% of sales. We expect our NOL tax asset to shelter us from paying all, but approximately $15 million to $20 million in cash taxes in 2018. As a result of the capital markets transactions we executed in 2017, our cash interest should be reduced to approximately $100 million in 2018. We expect one-time costs of $15 million to $20 million as we continue our system integration work, and in total, we expect to generate $170 million to $190 million in net free cash flow after investing activities for the full year 2018. We expect to utilize cash generated to pay down debt and fund our strategic growth investments and we expect to reduce our leverage ratio to 3.5 times or lower by year end, which is within our long-term target range. Due to seasonal patterns of working capital needs, driven by the seasonal nature of our customers' business, we typically use cash in the first half of the year and generate cash in the second half of the year. Therefore, in the first quarter of 2018, cash used in operations and investment was $197.9 million, including $19.5 million of capital investments. This was in line with our expectations and with our annual guidance of generating $170 million to $190 million in net free cash flow for the full year of 2018. We continue our track record of reducing our leverage ratio and this quarter was no different. Despite the impact of commodity product price inflation on inventory, our net debt to adjusted EBITDA ratio on a trailing 12-month basis as of March 31, 2018 was 4.6 times, representing a 0.4 times reduction from the first quarter of 2017. Total liquidity at March 31, 2018 was $321.9 million, consisting of net borrowing availability under our revolving credit facility and cash on hand, which is more than sufficient for our operating needs. As we look forward with confidence in our team's execution and the housing market environment, we would like to provide color on how we are seeing the second quarter of 2018 as well as reconfirming how we are thinking about 2018. For full year 2018, we still expect single family starts to grow in the mid to high single-digit range, R&R market volume growth of approximately 3% and declines in the multi-family end market. We also anticipate 5 percentage points to 6 percentage points of top line sales growth from commodity inflation on a year-over-year basis. From a gross margin perspective, the recent lumber and panel price moves will continue to constrain our gross margin percentage in the second quarter. However, as we move through the second half of the year, we expect to return to a more normalized gross margin in the 25% range. Year-over-year commodity inflation driven gross margin compression during the balance of 2018 should not be nearly as impactful as it was on our 2017 results, allowing us to return to a more normalized incremental EBITDA conversion of roughly 12% to 15% in the second half of 2018. We will continue our growth strategy of investment in new value-added manufacturing facilities and sales talent in 2018 as well as start-up costs in our operational excellence initiatives, all of which combined, we expect in total $10 million to $12 million in incremental cost during the balance of 2018. Overall, we continue to expect 15% to 20% year-over-year EBITDA growth for the full year in 2018 and current estimates indicate that we will finish out at the upper end of that range. We expect the tax impact of the 2017 Tax Act to result in an effective tax rate of approximately 25% for fiscal 2018. The recently enacted tax reform will also enable us to generate higher net free cash flow in the years ahead, enabling more rapid debt repayment and providing additional cash for our strategic growth initiatives. For the second quarter specifically, we expect sales to be in the 10% to 15% over prior year range, with 6% to 9% coming from commodity inflation. Gross margin is expected to be flat to Q1 2018 as we continue to absorb the short-term margin compression from the recent commodity inflation. We will maintain our focus on cost discipline, efficiency improvements and leverage reduction, while investing in our growth initiatives. We expect EBITDA growth to be around 15% for the quarter. I'll now turn the call back over to Chad for his closing comments. M. Chad Crow - Builders FirstSource, Inc.: Thank you, Peter. There's certainly a lot to be excited about here at Builders FirstSource as we capitalize on the opportunities we see for our team and our company in the current environment and invest in an even brighter future. We've all worked hard to achieve our strong positioning and we are set to take advantage of improving market conditions, including ongoing growth in the housing market and the benefits of higher commodity prices that have begun to turn our way. We expect to continue to improve our margins through investments that deliver operating leverage, investments in the growth of our value-added products network and disciplined cost management. I am confident that the investments we have underway across our strategic initiatives will yield meaningful profit growth and a further advantaged service model for our customers in the coming years. I'll now turn the call over to the operator for Q&A.

Thank you. And our first question is Nishu Sood with Deutsche Bank. Please go ahead. Nishu Sood - Deutsche Bank Securities, Inc.: Thank you. Let me start off with the sales volume per day, the 3.9% I think in the single family. What do you think that would have been without the weather effect? Just trying to get a sense of that. Would it have taken you all the way back to the kind of mid to high single digits you're expecting for the year or – yeah, so just trying to get a sense of the weather impact? M. Chad Crow - Builders FirstSource, Inc.: I would qualify the weather impact as a slight negative year-over-year. So, would it have gotten us all the way there? Probably not. But what we have seen in the first quarter was some outsized (23:20) growth and some of the larger markets that we don't participate in, Phoenix, Vegas and Miami are a couple of examples. But weather was part of the equation there. And I think there's other issues. You've got labor constraints out there that are likely slowing cycle time and so the level of construction that may or may not be taking place on a particular start may be varying. And with the growth in the starter homes and the first time move up homes, you are looking at some smaller homes as being part of the mix, but that's part of the deal. If we're going to get back to a more normalized level of housing starts, we need that first-time homebuyer to get active. So, I think it's a combination of those things. Nishu Sood - Deutsche Bank Securities, Inc.: Thinking about the mix of factors that you just went through, the mid to high single-digit volume assumption you have for the market overall, how will that then translate do you expect for your new home sales growth on a volume basis? M. Chad Crow - Builders FirstSource, Inc.: In the guidance we gave, we're assuming around a 5% volume growth in those numbers. That answers your question. Nishu Sood - Deutsche Bank Securities, Inc.: Got you, got you. And the other question I wanted to ask was on the inflation. 9% impact of inflation in 1Q. You are expecting mid-single digits. Can you walk us through just some of the puts and takes there? Is it just that the obviously the year-over-year comps, obviously the trajectory was pretty much straight upwards, the relative movements of panel – panels versus lumber? What brings it back down from the 9% to the 5% to 6% you're expecting for the year overall? M. Chad Crow - Builders FirstSource, Inc.: It's mainly just the year-over-year variance. We had quite a bit of inflation in the back half. And so, when we run those numbers, we're just assuming prices stay where they are as of today from an inflation standpoint. Nishu Sood - Deutsche Bank Securities, Inc.: Got you. Okay. Thank you.

And we'll take our next question from Kathryn Thompson with Thompson Research Group. Please go ahead. Steven Ramsey - Thompson Research Group LLC: Good morning. This is Steven Ramsey on for Kathryn. With the single family in construction to lower price point homes, are you seeing this in all regions and does that necessarily imply that you're seeing a decline in mid to larger homes? And can you discuss how this helps or hurts product categories? Peter Jackson - Builders FirstSource, Inc.: So, well, a couple of specifics. We are tracking it and seeing it at that lowest level by region. I think most of what we're seeing isn't seen in the data that's being broadly available to everyone, right? There are a couple of surveys and some studies that have indicated a transition. Obviously, some of the larger homebuilds, we've talked about it a lot. In certain markets definitely becoming a more important part, but no, I don't think it's at the expense of the mid to higher range home sales. I think it's in addition. I think that's the part that we really are happy about. It's the idea that we can get to the more normalized growth, that 1.1 million to 1.2 million single family starts that we kind of all expect, that's the piece, I would say the largest component that we're missing up until now is that starter home sort of tier. So, excited about that. And the meaning – what it means to us, while the top line may – you may see because you've got less linear (27:12) smaller home than you would in a larger home, maybe a little bit of a headwind on the revenue or revenue per start, but we still feel good about the EBITDA dollars per start, and that's really because of the trends to use more manufactured or pre-fabricated components in those homes. Generally, a simpler design allows us to provide roof trusses, wall panels or joists where they might perhaps not be used in some other designs and the cost to serve given the nature of single family constructions generally in our favor as well. So, we feel really good about the opportunity that that represents. Steven Ramsey - Thompson Research Group LLC: Excellent. And then with homebuilder consolidation, is this a headwind or tailwind for you or does it potentially increase the opportunity to drive adoption of the value-add manufacturing facilities products? M. Chad Crow - Builders FirstSource, Inc.: Well, with the consolidation we've seen to-date, we've got great relationships with those builders. I think it's going to – with our national footprint, I just think it's going to make us even more valuable as they grow and as they cover more of the country, I think our footprint and our scale is going to play nicely with them. Steven Ramsey - Thompson Research Group LLC: Great. Thank you. Peter Jackson - Builders FirstSource, Inc.: Thank you.

And our next question is with Matt McCall with Seaport Global Securities. Please go ahead. Matt McCall - Seaport Global Securities LLC: Thank you. Good morning, everybody. M. Chad Crow - Builders FirstSource, Inc.: Good morning. Matt McCall - Seaport Global Securities LLC: So, I think I've heard – well, I know I heard the commodity inflation here, but what about the commodity volatility? Not talking about the mix impact here. Was there a hit from volatility in the quarter? And then, what do you expect in the Q2 guidance from the movements in commodities? Peter Jackson - Builders FirstSource, Inc.: Yeah. So, we definitely did see a couple of different things going. And I guess to reference one piece of a comment from before, the general trend in the first quarter was lumber was a very volatile, very aggressive increase and that was the cause of the pain. We did see some tailwinds from the pullback on OSB, but it was overwhelmed by the negative influence on margins of the lumber inflation. What we would expect to see is that the year-over-year basis, our gross margins in the quarter hurt us for about 50 basis points on a combination of rate and mix, right? So, while the dollar – while percentage amounts in the quarter were up on both lumber and OSB, OSB from a net impact on gross margins in the quarter was favorable because of the buys that we made in the fourth quarter based on the volatility in that OSB. We think that is probably those contracts is worth maybe around $5 million of negative impact all in for the quarter. And if that combination again of the negative mix associated with the rapid growth of lumber, offset by the benefit of the positive mix from the favorable growth of our manufacture and value-add products. M. Chad Crow - Builders FirstSource, Inc.: And, Matt, I'll just add and I know you know this, framing lumber has been on a tear the last few weeks, but panels and OSB have been remarkably flat and all indications are at least where we sit today. Lumber could have a little bit more upside, but we see panel and OSB kind of settling in where it's at. And later in the year, we may see a little fall off in lumber, but all in all the lumber prices are at very good levels for us and it does finally start to feel like we're getting on the other side of this thing. We're obviously generating incremental gross margin dollars now, even though our margin rate is lower. But we've gotten some good price increases pushed through and it really feels like we're – this thing is going to start to turn and actually be a wind in our back. And it's been a long time coming, all of us in this space for a year and a half feel like we've been chasing this thing and it finally feels like we're catching up with it. Matt McCall - Seaport Global Securities LLC: Okay, very helpful. So, you've mentioned a few things. You mentioned cost management efforts and you've also talked about the investments. I think the total growth investment was $4.6 million in the quarter. I think you previously discussed $10 million to $15 million for the year. Is that still a good number? What is the kind of the trajectory through the year, the cadence through the year? And then, how does that compare to maybe some offsets from a cost management perspective? Peter Jackson - Builders FirstSource, Inc.: Yeah, I still think those are good numbers. A little bit of front loading on some of that. Some of that has to do with the spend. Some of that has to do with the benefit, giving you a net number there. So, I think it's still a good number what you've got. The initiatives are underway. There is – it's hitting on a couple of different lines. So, I'm not sure how to give you more detail about it. Matt McCall - Seaport Global Securities LLC: Okay. I mean, so you said the offset, so the cost management. Are there other offsets where we see maybe it's the investments in that being net neutral or close to net neutral? I'm just trying to get a magnitude of the cost management efforts. Peter Jackson - Builders FirstSource, Inc.: Yeah, not yet. At this point, we're funding to get the projects rolling, staffing, third-party resources, that sort of thing. As the year progresses, some of that comes in, but the net is the $4.6 million. Matt McCall - Seaport Global Securities LLC: Got it. Peter Jackson - Builders FirstSource, Inc.: For the quarter, and the net for the full year is that $50 million (32:58). Matt McCall - Seaport Global Securities LLC: Net number. Okay. All right. Thanks, Peter.

And our next question is from Will Randow with Citi. Please go ahead. Will Randow - Citigroup Global Markets, Inc.: Hey, good morning, and congratulations on the progress. M. Chad Crow - Builders FirstSource, Inc.: Thanks, Will. Peter Jackson - Builders FirstSource, Inc.: Thank you. Will Randow - Citigroup Global Markets, Inc.: I guess I just had a question, I've obviously asked in the past, but in terms of your guidance, looks like it's based on current price locks with your customers or stated differently pricing from a little over a month ago on average. Please correct me if I'm wrong. And then also can you review your EBITDA and free cash sensitivity for this year, basically second half, if you have a 10% move in lumber and also what that would look like for next year? M. Chad Crow - Builders FirstSource, Inc.: To answer your first question, yeah, obviously, we've got price locks. We've got some good price increases pushed through in the second quarter. As I mentioned, we'll see what framing lumber does. If it stays up where it is, that will be a bit of a headwind later in this quarter. But, overall, I still think you're going to see some nice progress in our margins. And again, borrowing any unexpected additional run up in the back half of the year, I think we're following going to get the wind in our back. As far as the cash flow sensitivity, all that, I'll let Peter take that one. Peter Jackson - Builders FirstSource, Inc.: Yeah, so cash flow for the full year, we're definitely still on guidance. We feel good about it. The sort of key components in there is that working capital around 9%. Taxes being at – still at the 15% to 20% range, interest at about $100 million, one timers doing that $15 million to $20 million range and then CapEx at a roughly 1.6% number, and as you recall, we generally use a lot of cash at the beginning of the year and we generate in the back half. We still think that's true. Obviously, the inflation and the increased pricing in the lumber and commodities do have an impact on working capital. But at this stage, we think we're managing through it and we expect to deliver on guidance. Will Randow - Citigroup Global Markets, Inc.: Okay. And just to rehash that for clarity purposes, your guidance is based on your current price locks, not the current spot prices. And it sounds like based on the commentary you just made, Peter, you're probably at the top end of your free cash flow guidance given where lumber prices are? Peter Jackson - Builders FirstSource, Inc.: I think we're at the higher end of our guidance on the EBITDA growth. I'm not sure I would say we're at the top end of the guidance on the cash growth just because of the offsetting impact of the value of working capital. Will Randow - Citigroup Global Markets, Inc.: Okay. Peter Jackson - Builders FirstSource, Inc.: (35:48). Will Randow - Citigroup Global Markets, Inc.: I follow. And the price lock piece, that's what your guidance is based on, your current price locks? Peter Jackson - Builders FirstSource, Inc.: Yeah. It's based on our current experience, that's what our forecasts are based on. Correct. Will Randow - Citigroup Global Markets, Inc.: And then just as a quick follow-up. In terms of like engineered products, meaning assembled wall components, et cetera, are there any regions where you're seeing incremental acceleration in terms of adoption? Obviously, the Pacific Northwest has been a strong market for some. But are you seeing a real incremental pickup in certain markets just given the labor constraints? M. Chad Crow - Builders FirstSource, Inc.: Ones that come to mind, as you mentioned, Pacific Northwest, Colorado, Florida, would probably be the top three. Will Randow - Citigroup Global Markets, Inc.: Sounds great. Thanks again, guys, and congrats again. M. Chad Crow - Builders FirstSource, Inc.: Thanks. Peter Jackson - Builders FirstSource, Inc.: Thank you.

And our next question is with Jay McCanless with Wedbush. Please go ahead. Jay McCanless - Wedbush Securities, Inc.: Hey, good morning, everyone. Thanks for taking my questions. M. Chad Crow - Builders FirstSource, Inc.: Good morning. Jay McCanless - Wedbush Securities, Inc.: The first question I had in terms of the sales benefit for the full year from commodity growth, it looks that you guys have tightened that range. I think you said 4% to 6% in the 4Q call, and now you're saying 5% to 6%. Did I hear that correctly? Peter Jackson - Builders FirstSource, Inc.: Yes. Jay McCanless - Wedbush Securities, Inc.: Okay. And then in terms of the volume growth, I heard – I jumped on late, so I apologize, but was the comment about 5% volume growth, was that related to 2Q sales or is that what you guys are thinking volume growth looks like for the full year? Peter Jackson - Builders FirstSource, Inc.: Yeah, no, so that's not the volume growth for the full year. The full year total revenue is in that 10% to 12% range. The full year volume growth for single family is in those mid to high single digits range. That's what we were talking about in terms of that 5%. That's really just the single family component. Obviously, we believe multi-family is down a bit again this year, R&R and other still in that kind of 3% range as usual. M. Chad Crow - Builders FirstSource, Inc.: Yeah. I think the multi-family growth will largely be offset – or multi-family decline will largely be offset by the R&R growth. So, what you're left with is somewhere around 5% to 6% volume growth in total and for single family the way the math works. Jay McCanless - Wedbush Securities, Inc.: Got it. Okay. Another question I had, just if you look at some of the other indicators that are out there for repair and remodel spend and repair and renovation spend this year, a lot of those seem to be ticking towards the high end of the traditional ranges. So, I'm a little surprised to hear you guys talking about 3% growth. What could change or what do you see that might influence that number from 3% to 3.5% or 3% to 4%? Peter Jackson - Builders FirstSource, Inc.: Well, this is one we struggle with. I mean the greatest challenge we have in this space is geographic exposure and where our R&R/other is geographically versus the national averages. So, our exposure to California and Alaska and the Upper Midwest in the R&R space and then of course the other representing some of the commercial and industrial work that we have in some of the other product areas, that is where we have a tendency to candidly not be a good reflection or a good match to that national metric that you're seeing. I think certain markets are absolutely doing better than that for us and candidly some others aren't. Alaska is a good example of a market that's struggling a bit that pulls down our average, but it's still a healthy business for us and we like it. Jay McCanless - Wedbush Securities, Inc.: Got it. And then just since you mentioned California. With the state's adoption of these new solar panel codes starting in 2020, is that something that could benefit you guys? Do you all distribute any of the solar panel equipment now or is it something you would consider doing, assuming that code change holds? M. Chad Crow - Builders FirstSource, Inc.: Well, that's obviously a pretty new headline, I haven't given a lot of thought. I did call on our Texas location today and told them to get ready for some incremental business from the influx of Californians coming over. But all joking aside, absolutely we would consider it. It's not something we do now. And we'll see. I don't really know exactly what that means, what's going to be required. I think I saw an incremental $10,000 in cost for new houses, the current estimates. So, we'll see. It's an interesting twist that we'll certainly keep an eye on. Jay McCanless - Wedbush Securities, Inc.: Okay. Sounds great. Thanks, guys.

And our next question is Blake Hirschman with Stephens, Inc. Please go ahead. Blake Hirschman - Stephens, Inc.: Yeah. Good morning. Congrats on a good quarter and thanks for taking my questions. M. Chad Crow - Builders FirstSource, Inc.: Thank you. Blake Hirschman - Stephens, Inc.: First off, there's a lot more talk kind of across the space on increased freight and transportation costs and apologies if you've already kind of touched on it. But just was hoping to hear if you guys could kind of walk us through how that might impact you guys? M. Chad Crow - Builders FirstSource, Inc.: Well, that's certainly – the transportation issues are certainly one of the main factors that are driving the commodity prices up and keeping them in elevated level. So, it's really just all part of our cost of goods and getting that pushed on. The net result we – as you know, we love high commodity lumber prices and transportation is certainly playing a part of that. So, at the end of the day, it's a good thing for us and as I said earlier, it feels like we've got (41:36) now and we're about to finally get in front of this thing and get some wind in our back. So, net-net, it's a good thing for us and that's definitely part of the equation right now and getting those wood products into our locations. Peter Jackson - Builders FirstSource, Inc.: And on the (41:52) side, clearly we're seeing the impact of the fuel and the cost of drivers. But because we own our own fleet, we're a little less tousled by the winds of expense with regard to the freight lines and their rates. Blake Hirschman - Stephens, Inc.: Got it. That's helpful. And then one more. I think I caught earlier comments that incremental margins are expected to be kind of at that more normal 12% to 15% and I think you said in the back half of the year. So I just wanted to be clear if there was any changes the way you're thinking about incrementals for the full year, which if I'm not mistaken was 12% to 15% excluding some additional SG&A investments that you guys have called out? Peter Jackson - Builders FirstSource, Inc.: Yeah. So, that's correct. We are trying to communicate that as we get into the second half of the year, we expect that we'll get back to two things. One is the gross margin that closer approximates what we were 18 months ago in that 25% range and in addition to fall through, we think in the second half we'll be back within the normal range as well in that 12% to 15%. Blake Hirschman - Stephens, Inc.: Got it. Okay. Thank you. Peter Jackson - Builders FirstSource, Inc.: Thank you.

And our next question comes from Matt Bouley with Barclays. Please go ahead. Marshall Mentz - Barclays Capital, Inc.: Good morning. This is actually Marshall Mentz on for Matt. How are you all doing? M. Chad Crow - Builders FirstSource, Inc.: Good morning. Good. Marshall Mentz - Barclays Capital, Inc.: I just wanted to ask about, what do you all see as you're exiting the quarter in terms of trends and maybe quarter-to-date here into May that leads you to the growth that you're expecting in EBITDA for the second quarter, and then your comments about expecting to be now more towards the high end of the full year EBITDA range? Is that driven by inflation coming in at the high end potentially of the 5% to 6% or are there other factors moving in your favor that you're seeing in your end markets? M. Chad Crow - Builders FirstSource, Inc.: Well, a couple of things. Certainly, we're pleased with the price increases we're getting passed through, the rate at which, at least in place, our lumber products have gone up has seemed to have slowed. So, I said earlier we finally seem to be getting caught up from that standpoint. And another big factor is just the demand for our truss and panel products, certainly don't see that letting up and probably continue to grow as the builders continue to look for ways to cut back on their labor and deal with these labor shortages. So, it's a combination of those things and just the positive feedback we're getting from our guys out in the field and from our customers, it just – it feels like things are really setting up for a pretty good back half of the year. Marshall Mentz - Barclays Capital, Inc.: Thank you and good luck. Peter Jackson - Builders FirstSource, Inc.: Thank you.

And our next question is from Lee Nalley with SunTrust. Please go ahead. Lee Nalley - SunTrust Robinson Humphrey: Hi, thanks. Good morning. Thanks for taking my question. M. Chad Crow - Builders FirstSource, Inc.: Good morning, Lee. Peter Jackson - Builders FirstSource, Inc.: Good morning, Lee. Lee Nalley - SunTrust Robinson Humphrey: Just wondering, what's your current appetite for acquisitions and then what would be your max comfort level on increasing leverage too? M. Chad Crow - Builders FirstSource, Inc.: Not a big appetite right now. We're still on a path of delevering and we intend to stick to that. I couldn't rule out a small tuck in here or there, especially if it was a buy versus build decision. I think that might be a situation where we might buy someone rather than build a new location. But we're – anything large or transformational, if it's going to deviate us from our deleveraging that we – the path that we're on, then that's very unlikely. Lee Nalley - SunTrust Robinson Humphrey: Okay. Thanks. And then what – so what would be your target for getting leverage too before you just start considering bigger M&A? I know your target is 2.5 to 3.5. Is it just once you get there or something lower? M. Chad Crow - Builders FirstSource, Inc.: Well, that's our initial target, and I think we'll be there by the end of the year and then I think it's just a matter of assessing the overall environment where we think we are in the cycle, what the next couple of years look like. But that would probably be the point in time where we really start to give us some serious thought. Lee Nalley - SunTrust Robinson Humphrey: Right. Okay. Thank you. Peter Jackson - Builders FirstSource, Inc.: Thank you.

And we'll take our next question from Alex Rygiel with B. Riley FBR. Please go ahead. Min Cho - B. Riley FBR, Inc.: Hi, good afternoon. This is actually Min Cho for Alex. Most of my questions have been answered, but I do have this one kind of question. If you could provide any progress that you're making on the growth initiatives that you discussed in terms of the new truss plans and hiring the new associates and when do you – when should we expect to start to see some of the benefits of those investments? M. Chad Crow - Builders FirstSource, Inc.: Well, from a sales growth or sales force growth initiative, we hired around 120 net new sales people last year. I think right now we're trending somewhere 75 to 100 this year and so that has certainly been successful and definitely helping us build the bench strength for the future. And earlier in the call in our prepared remarks, we discussed a lot of our growth initiatives, significant investment in truss plants, both new facilities and increasing the efficiency in existing plants, door shops. And so that's all part of the growth in our manufactured and value-add products that you're seeing. And certainly in the last year, year and a half, the growth in those categories has outpaced the market. So I think you are seeing it and I think you will continue to see it. Min Cho - B. Riley FBR, Inc.: Okay, great. Thank you.

And that's all the time we have for questions. Mr. Crow, I will turn the call back over to you for closing remarks. M. Chad Crow - Builders FirstSource, Inc.: Thank you once again for joining our call today. We look forward to updating you on the progress of our initiatives in the quarters ahead and if you have any follow-up questions, please don't hesitate to reach out to Jen Pasquino or Peter Jackson. Thank you.

And this concludes today's call. Thank you for your participation. You may now disconnect.