Boyd Group Services president and CEO Timothy O’Day expressed confidence in the steady growth of the company’s auto glass segment during a November 10 third-quarter 2023 earnings call.
“I’m pretty excited about our auto glass business and the opportunity that we have,” O’Day said. “We’ll continue to grow that in tandem with our collision business.”
O’Day told investors that the firm has been quietly growing its auto glass business in tandem with the collision repair business for many years. “The auto glass business is a really important part of our company,” he said.
“Not only have we been growing organically, but there’s some good tailwind from the auto glass business, including an increasing requirement for calibration of front forward-facing cameras on windshields that we replace,” O’Day said.
The company, he said, made some modest acquisitions to enter new markets or build scale in existing ones in auto glass, activities he expects to continue.
Boyd Group owns Boyd Autobody & Glass and Assured Automotive in Canada, and Gerber Collision & Glass in the U.S. The company’s holdings also include Gerber Collision & Glass, Glass America, Auto Glass Service, Auto Glass Authority, and Autoglassonly.com.
One prominent player dominates the auto glass industry, according to O’Day. A few mid-sized players, such as the Boyd Group, are relatively small but positioned to scale up in size to service their insurance company partners.
“The rest of the market, though, is highly fragmented with small glass businesses, typically owner-operated small glass businesses, much like the collision repair industry,” O’Day said. “We’re able to acquire businesses at attractive multiples, build them, and integrate them into our business. That’s part of the formula for growing our glass business.”
The auto glass industry primarily serves its customer’s customers, he said. “One of the strengths of Boyd is to be focused on delivering value, not just by satisfying the vehicle owner, but also by making sure we do it in a way that keeps our insurance companies’ costs under control and gives them a reason to give us more work.”
Boyd Group reported third-quarter 2023 gross profits of $333.8 million, an 18.3% increase over $282.3 million in the same period in 2022.
Sales increased by 17.9% to $737.8 million from $625.7 million in the same period of 2022, including same-store sales increases of 11.8%. In the third quarter of 2023, they experienced fewer selling and production days than in 2022, which decreased selling and production capacity by approximately 1.6%.
“We are pleased with the results reported in the third quarter of 2023, which continue to show increased same-store sales and steady growth of single locations,” O’Day said.
The company added 78 single locations this year while achieving same-store sales increases of 18.3%.
“While quarterly same-store sales increases have tapered from those experienced during the period following the pandemic and pandemic-related disruptions, over the past five- and 10-year periods, the company has posted average quarterly same-store sales increases of 6.7% and 5.9%, respectively,” O’Day said.
Read the full 3Q report on the Boyd Group website.