Tell us, first of all, macro view from what you are seeing in terms of the

level of activity, people doing projects.

How would you describe the economy and how the consumer is looking to do

something? So we're in such a unique position.

It tracks because we're 95% repair remodel.

So we still have a lot of people when it comes to those interest rates sitting on

3%. So they're not moving around.

You got inflation right. So that is the inflation has come

through. A lot of people are having more

staycations, spending more time at home investing in their home.

So uh, we're seeing like contractor logs that are booked out, you know, eight, 12

weeks right now. And we've been doing a lot in terms of

how we spur, uh, spur the growth at the lower end.

So we've been seeing great growth in the middle tier, the higher tier, the K

shaped economy. Yeah.

But this year the focus has been on marketing and conversion from wood,

because every 1% share away from wood is about $80 million in revenue for Trex.

Wow. So again this is an we've we've we spoke

to your predecessor about a year ago. And I remember him saying that it's all

about getting people who have wood decks now when they're thinking about

remodeling to remodeling with Trex, you're not the only player, though.

There's like one other competitor, Timber Tack.

How do you position yourself against them?

Yeah. So when you look at this market, it's a

$75 billion outdoor living market. Trex has a $15 billion Tam, of which

decking is about $8 billion. So when we break it down, we invented

the category. Right?

So we're 95% recycled. 100% of the decking is made here in

America. Most of the railing is made here in

America. When you start to look at the breadth of

product line that Trex is the only manufactured, it has it from $2 a lineal

foot to $10 a lineal foot. So we have pretty much everything that

you need from top to bottom. We're number one in decking.

We're number one in wood alternative railing.

So actually when you look at us in railing, even though we're number one,

it's only 6% of the total market. Our fastest growing segment is railing

right now. And if you look at like our product

lineup, it towers over the competition in terms of what we have to offer.

But only 6% because people are still going with wood.

Yeah, yeah, wood. There's some PVC that's out there and in

some cases you might have some codes for 30in or less.

You don't need the railing, but primarily it's still wood.

So there's so much opportunity. What is the conversion rate from people

going from wood to your product. Yeah.

So see. Yeah.

So I would say the last several years it's been more stagnant.

But we did this year we've really focused on that opening entry, spending

a lot more money in marketing. I mean Trex is a marketing machine.

So if you go to Trek Scotland, we go out there, you see Martha Stewart, if you go

to Track Star. That's right.

Yeah. She's it, she's a new influencer for us.

She's actually got two different decks right now.

And so you go to tracks, you'll see the fact that you can build your own deck

online. We give you a cost calculator just like

you shop for your car. Then you've got free samples that you

want. You can get them online.

We take you through the whole consumer journey how to design your deck.

And at the very end we offer up contractors.

So really, really powerful. And this is one of the reasons why we

also partnered with Martha. Because when you look from a marketing

perspective, she has such a design influence in the way these decks look.

And there's a lot of power in Trex and Martha teaming up.

Yeah, I think it's fascinating. Talk to us two about, as you say, um,

the decking, everything's made in the United States.

Talk to us about your facilities, your supply chain, and walk us through that a

little bit. Oh, man.

It's a great All American story. So once again, the founders which

started on green principles just for the simple fact that 30 years ago, this is

our anniversary this year. They didn't want to see the plastic go

in the landfill, so it truly became something that is what do I make out of

this? Trex is more or less like when you were

a kid and you wanted to push Play-Doh out of a Play-Doh set.

We're pushing rectangles. We're pushing the Play-Doh out of the

Play-Doh set. And so when you start to look over time,

we have the Winchester, Virginia, which is our home site, and we manufacture

there. We also have Nevada facility.

But what the problem was the last several years as we ran out of space.

So we bought a greenfield in little Rock, Arkansas.

We have 300 acres down in little Rock. We started our pellet processing last

year, and then the plan was next year to start our decking production.

But we've had such good robust growth. As you saw our record earnings in Q2

from the wood conversion, that we're actually bringing up the timeline on our

little Rock facility by six months now. There's a lot of strategic initiatives

going on there. That is the hub in terms of where we get

a lot of raw materials out of that area. Uh, it lowers the cost of freight in the

Midwest. But the fastest growing part of the wood

market, the Sunbelt region, New York, new Jersey, Illinois, A lot of people

move south. Plus there's a lot of southern yellow

pine down there. So we think we're really strategically

place for that plant to take a lot of share.

I have two family members who moved down to outside of Charleston, South Carolina

in the last, I don't know, kind of pre pandemic a little bit post-pandemic.

Both have built outdoor um decks you know enclosures.

I mean it's just kind of how you live out there.

Um but that's what everybody is doing. And you just continue to see that.

What about from a manufacturing perspective the labor picture.

And if you're able to get enough folks to work not just in the Nevada and

Winchester facilities, but how it's looking in Arkansas right now, you know,

we're bringing the best paying jobs down there.

People are really appreciative of the fact that Trex has entered the market.

They're aware of the brand. They love the fact that we are an All

American made company. How many people do you have to hire down

there? So we started with 50 on pallet

processing last year. Within the next year, you're going to

see upwards of 200, with the long term plans getting upwards of 500.

Now that's just for what we've built so far.

Infrastructure wise. The plan longer term is we could put

several decking plants there, several railing plants there.

So there's really, you know, endless opportunities when you start to think

longer term and how we can expand, and you think you can find the employees

that you need. We already did the first job fair that

came right out of the gates. As we open up this decking facility in

Q3 of this year, thousand people showed up, which to me was very, very strong

shows. People want to come work for Trex.

I do want to ask you, because I think we are thinking about tomorrow's monthly

jobs report and the types of jobs that are being created, and we know some of

them, certainly we cover it, but what what kind of jobs are they?

Are they hourly or they full time? Give us some idea.

It's across the board. So from the hourly perspective you gonna

have people at the end of the line. There's a lot of packaging

opportunities. But then you move on up the line.

You get into processing. Right.

So how you make the product forklift operators.

So the distribution side all the way to loading flatbed trucks.

And then you also have engineers, process engineers, project engineers.

And then you also have plant managers down there.

So it's really a broad range. It's a whole site that we're going to be

building out down there. This is interesting.

We've got some questions. We're taking questions in from viewers.

And this is um, Brendan from Rockville, Maryland.

Brendan. Thank you.

Um. He says, what is the return on

investment of a Trex home renovation relative to other projects, such as

fiber cement siding? I don't know if, like, this comes into

your world. Like, maybe he's thinking a little bit

about Hardy back or two and like, the different composite materials that are

built. Yeah.

So when you're home, when you start to look at Trex decking, this is where we

start to show the value of Trex versus wood.

It's really about seven years when you start to look.

And it could be less than that. Now.

It depends on it. We build in a really elaborate deck, so

we've had no issues in that middle to upper tier in terms of people wanted by

Trex. It's that lower tier, and we're trying

to show them the fact that Trex not only has that return on investment, but you

don't need to go out and build this extravagant deck, right?

Even a rectangle as you move out in the yard, because would only last you

upwards of 10 to 15 years before it might rot out with all the new species

that are out there. So it's a great return on investment.

It's one of those things when you look at the advertisements that are out

there, many of the listings have Trex in those advertisements because there is

something that adds value to the home, like the advertising for a home that's

on the market. And listing on the market is going to

have Trex decking in it. Oh, interesting.

Um, the other part of the labor picture that we're curious about to hearing from

you is what you hear from contractors who, you know, in some cases, they're

the ones who are, uh, offering their clients and the folks who buy who are

buying their services. They're saying, hey, I recommend you use

Trex, for example. Uh, are they able to find the labor out

there? Are they?

Because in some cases, I'm hearing stories of like, you know, you can and

New York's different, but you can't get a contractor to walk through for small

projects like they're so booked out with big stuff.

Yeah. So it depends on the part of the country

where it can be challenging. I mean, many of them also hire

subcontractors along the way in order to help build out those businesses.

But I think they're very creative. What we've tried to do to address that

is a lot of our new products. We're trying to make them more DIY

friendly and contractor friendly. So let me give you an example.

Railings are fastest growing segment. It's really complex.

It could take upwards of an hour to install a section of railing.

Now it takes less than ten minutes because what Trex has done on a lot of

their new railings is they're all pre-assembled.

So you get it. You have a post, it already has a

brackets, and you drop those and you drop a panel in four screws and you're

done. So the simplification when we make our

deck boards, we put grooves in the dashboards and then we have a hidden

faster that helps pre gapped the grooves in there.

So you don't have to worry about the expansion contraction.

So we're trying to think of how can we make it easier.

There's a lot of DIY tools that we make available out there on YouTube where

people can go out and see it's not as complex as you think.

We help you, walk you through the journey from step to step.

What happens to old track decks? Truck decks?

Um, because you guys are made from mostly reclaimed recycled materials like

85%. Yeah.

So what happens to old ones? So here's what we're trying to do now.

So the last several years we started to go out.

We started locally and we're trying to expand out broader is we're starting to

create with some of our dealers ways to collect material.

So it could be a current Trex deck today we're a contractor has scrap material or

homeowner have some. They can bring it back and we'll come

collect it or even old Trex decks. You could take a Trex deck.

Let's say we've had a couple different generations of tracks.

Let's just say you had the first generation of Trex.

We can take that back and recycle it. So we're trying to once again create

that life cycle. And if we can get it back, we want it so

we can go out there and reuse it.