Roof shingle-maker TAMKO Building Products reported a more than 50% drop in earnings just weeks after borrowing money to fund a dividend to its owners, according to people with knowledge of the matter.

The decline follows a strategic decision by the company to leverage its balance sheet, taking on additional debt to distribute funds to shareholders. This move has raised questions among industry analysts about the sustainability of such payouts amid declining profitability.

Backed by private equity firm Carlyle Group, TAMKO has been navigating challenging market conditions in the construction sector. The earnings drop highlights the pressure facing building product manufacturers as material costs and supply chain disruptions continue to impact margins.

The company's financial performance underscores broader trends affecting mid-sized manufacturers in the housing industry, where demand remains strong but operational costs have surged significantly.