During 2023 we completed a number of acquisitions for a combined $252.5 million purchase price, net of cash acquired, including the acquisitions of Noltex Truss and its affiliates, Builders Millwork and Supply, Inc., J.B. Millworks, LLC, Church and Church, Inc., Franks Cash and Carry, Inc., Standale Lumber, LLC and Granville Lumber Co., LLC, and Encore Performance, LLC.

We will continue to focus on working capital by closely monitoring the credit exposure of our customers, remaining focused on maintaining the right level of inventory and by working with our vendors to improve payment terms.

We believe we are well-positioned to take advantage of the construction activity in our markets and to increase our market share, which may include strategic acquisitions.

Gross margin percentage increased to 35.2% in 2023 from 34.1% in 2022, a 1.1% increase. This increase was attributable to an improved product mix toward our value-add products, including recent strategic investments in multifamily value-add operations.

Selling, general and administrative expenses decreased $0.1 billion, or 3.5%. This decrease in expenses was primarily due to decreased variable compensation costs related to decreased sales and profitability, and reduced expense related to customer reserves, partially offset by additional operating expenses from locations acquired within the last twelve months.

We strive to achieve the appropriate balance of short-term expense control while maintaining the expertise and capacity to grow the business as market conditions expand.

The building products industry is highly dependent on new home and multifamily construction as well as repair and remodel, which in turn are dependent upon a number of factors, including interest rates, consumer confidence, employment rates, foreclosure rates, housing inventory levels and occupancy, housing demand and the health of the U.S. economy and mortgage markets.

Prices of building products are subject to fluctuations arising from changes in supply and demand, national and international economic conditions, including inflation and interest rates, labor costs, competition, market speculation, government regulation, and trade policies, as well as from periodic delays in the delivery of lumber and other products.

The building products supply industry is highly fragmented and competitive. We face, and will continue to face, significant competition from local, regional and other national building materials chains, as well as from privately-owned single site enterprises and new entrants into the market, due to the relatively low barrier to, and cost of, entry.

Our industry remains highly fragmented and competitive, and we will continue to face significant competition from local and regional suppliers.

We believe our integrated approach and scale allow us to compete effectively through our comprehensive product lines, prefabricated components and value-added services, combined with the knowledge of our integrated sales forces to enable our homebuilder customers to complete construction more quickly, with higher quality and at a lower cost.

We believe we are well-positioned to take advantage of the construction activity in our markets and to increase our market share, which may include strategic acquisitions.

Another important aspect of our strategy is controlling costs and striving to be a low total-cost building materials supplier in the markets we serve. We closely manage our working capital and operating expenses, and we pay careful attention to our logistics function and its effect on our shipping and handling costs.

We closely manage our working capital and operating expenses, and we pay careful attention to our logistics function and its effect on our shipping and handling costs.

However, we do have significant fixed costs and declines in our customer demand could have an adverse impact on our operating results.

We are in the process of implementing a new ERP system. The new ERP system is intended to transform areas such as manufacturing, supply chain, procurement, warehouse management, delivery, quote to cash, financial reporting, and analytics, and position us to better leverage automation and process efficiency and enable productivity enhancements.

An implementation of this scale is a major financial undertaking and has required, and will continue to require, substantial time and attention of management and key employees.

Furthermore, we may not realize the anticipated benefits from the implementation of the new ERP system.

Under share repurchase programs authorized by the board of directors since August 2021, the Company has repurchased a total of 87.1 million shares of common stock, or 42.2% of the Company's total shares outstanding, at an average price of $70.27, inclusive of fees and taxes, including 17.8 million shares of common stock at an average price of $100.49, inclusive of fees and taxes, in 2023. On February 21, 2024, the Company's Board of Directors authorized the repurchase of up to $1.0 billion of the Company's outstanding shares of common stock.

We expect our 2024 capital expenditures to be in the range of $400 million to $500 million primarily related to rolling stock, equipment and facility expansion and improvements to support our operations.

We may enter into various debt or equity transactions to appropriately manage and optimize our capital structure and liquidity needs.

We are also committed to making informed choices that improve our corporate governance, financial strength, operational efficiency, environmental stewardship, community engagement and resource management.

We prioritize purchasing and supplying sustainable wood products led by the Sustainable Forestry Initiative.

Our business faces increasing public scrutiny related to ESG activities. We risk damage to our brand and reputation if we fail to act responsibly or meet any commitments that we may set in a number of areas, such as DEI, environmental stewardship, including with respect to climate change, human capital management, support for our local communities, corporate governance and transparency, or fail to consider ESG factors in our business operations.

We believe the long-term outlook for the housing industry is positive and that the housing industry remains underbuilt due to growth in the underlying demographics compared to historical new construction levels.

However, uncertainty around interest rates and inflation may continue to dampen near-term housing industry demand as homes are less affordable for consumers, investors and builders.

We are operating in an uncertain economic environment. The global credit and financial markets have experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, high rates of inflation, and uncertainty about economic stability and a potential recession.