Siteone Landscape Supply, Inc. · NYSE:SITE
Siteone Landscape Supply — Q3 2020 Earnings Presentation
22 slides from Siteone Landscape Supply's earnings presentation, Oct 28, 2020
Slide 1: Third Quarter 2020 Earnings
SiteOne™ LANDSCAPE SUPPLY Stronger Together Third Quarter 2020 Earnings
Slide 2: Disclaimer
Disclaimer Forw ard-Looking Statements This presentation contains “forw ard-looking statements” w ithin the meaning of the Federal Private Securities Litigation Reform A ct of 1995. Forw ard-looking statements may include, but are not limited to, statements relating to our 2020 Adjusted EBITDA outlo
Slide 3: Conference call agenda
Conference call agenda Introduction John Guthrie, CFO Business Update Doug Black, Chairman and CEO Financial Update John Guthrie, CFO Development Update Scott Salmon, EVP Strategy & Development Closing & Outlook Doug Black, Chairman and CEO Q&A 3
Slide 4: Company and industry overview
Company and industry overview ■ Largest and only national wholesale distributor of landscape supplies ■ $20 billion highly fragmented market(1) ■ More than four times the size of next competitor and only ~12% market share(1) ■ Serving residential and commercial landscape professionals Distribution C
Slide 5: Track record of performance and growth
Track record of performance and growth Net Sales Adjusted EBITDA (in Millions) (in Millions) 2,358 201 2,112 ’14-’19 176 ’14-’19 1,862 1,648 Growth 157 Growth 1,452 134 Sales $ 107 Adj. EBITDA $ 1,177 32.1% 32.8% 32.0% +100% +172% 31.3% 74 29.6% 8.4% 8.5% GM % 8.1% 8.3% Adj. EBITDA % 26.4% 7.3% +640
Slide 6: SiteOne is poised for long-term growth and margin enhancement
SiteOne is poised for long-term growth and margin enhancement Current strategy Leverage strengths of both large and local company ■ Fully exploit our scale, resources and capabilities ■ Execute local market growth strategies ■ Deliver superior value to our customers and suppliers ■ Close and integ
Slide 7: Significant room to grow across product lines
Significant room to grow across product lines # of markets (1) Missing either Missing both Full Product No Hardscapes or Hardscapes Line Offering Presence Nursery and Nursery SiteOne offers all ~50 product lines in only ~21% of our target markets today… ~80 ~50 ~50 (1) Target markets as of Q3 2020 a
Slide 8: Third quarter 2020 highlights and recent developments
Third quarter 2020 highlights and recent developments Third Quarter 2020 highlights (compared to Third Quarter 2019): Net sales increased 15% to $751.9 million Organic Daily Sales increased 11% Gross profit increased 16% to $250.1 million; gross margin increased 30 bps to 33.3% SG&A as a per
Slide 9: Review of Third Quarter 2020 financial results
Review of Third Quarter 2020 financial results Summary financials Financial highlights (compared to prior year period) ($ in millions) ■ Net sales increased 15% to $751.9 million – Organic Daily Sales increased by 11% Net sales 652.8 751.9 – Acquired sales growth was $31.6 million, contributing 5% t
Slide 10: Balance sheet & cash flow highlights
Balance sheet & cash flow highlights Third Quarter 2020 Balance sheet & cash flow highlights (compared to prior-year period) ($ in millions) ■ Working capital increased to $709.6 million, compared to $516.2 million – Reflects decision to increase cash on hand to enhance financial flexibility in resp
Slide 11: Proven track record of successful acquisitions
Proven track record of successful acquisitions 2014 – 2015 2016 2017 2018 2019 2020 YTD Total Eljay Hydro- Aspen Valley Pete Rose Cutting Edge Wittkopf Scape Landscape Diamond Head Stone Forest Atlantic Irrigation All Pro Supplies Blue Max Horticulture Stockyard Angelo's
Slide 12: M&A continues to add significant value: Alliance Stone
M&A continues to add significant value Alliance Stone Closed on August 17, 2020 Expands our leading hardscapes and landscape supplies position in the greater Atlanta metro SiteOne existing Alliance Stone Cross-sell opportunities Purchasing synergies Source: Company data 12
Slide 13: M&A continues to add significant value: Modern Builders
M&A continues to add significant value Modern Builders Closed on August 18, 2020 Extends our leading hardscapes and landscaping products position in Southern California with two locations in the San Diego market SiteOne existing Modern Builders Cross-sell opportunities Purchasing synergies Sourc
Slide 14: M&A continues to add significant value: BURNCO
M&A continues to add significant value BURNCO Landscape Centres SiteOne existing Closed on October 1, 2020 BURNCO Landscape Centres Establishes a leading hardscapes and landscaping products platform with 12 locations across Western Canada Cross-sell opportunities Purchasing synergies Source: Com
Slide 15: M&A continues to add significant value: Hedberg Supply
M&A continues to add significant value Hedberg Supply Closed on October 5, 2020 Establishes a leading hardscapes and landscaping products platform with two locations in the greater Minneapolis market Cross-sell opportunities Purchasing synergies SiteOne existing Hedberg Supply Source: Company da
Slide 16: Robust pipeline provides significant growth opportunity
Robust pipeline provides significant growth opportunity SiteOne is the leading industry consolidator 12% Significant sourcing advantage with 80+ associates scouting new growth opportunities 88% Our pipeline is deep and expanding ~$20bn market(1) M&A team in place to execute our acquisition s
Slide 17: 2020 outlook
2020 outlook Continue to focus on operating safely and successfully in a COVID-19 environment Near-term market trends remain positive Continuing to pursue key commercial and operational initiatives M&A to continue with robust pipeline Raising 2020 Adjusted EBITDA guidance to a range of $23
Slide 18: Investment highlights
Investment highlights Uniquely Clear market leader attractive industry Compelling and Proven management sustainable team growth strategy Operational and Value-creating commercial acquisitions excellence 18
Slide 19: Appendix
Appendix Non-GAAP Reconciliations
Slide 20: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation 2020 2019 2018 ($ in millions) Q3’20 Q2’20 Q1’20 Q4’19 Q3’19 Q2’19 Q1’19 Q4’18 Net incom e (loss) $48.2 $79.1 $(17.5) $2.5 $34.6 $64.7 $(24.1) $(2.1) Income tax expense (benefit) 13.8 25.6 (13.5) (5.6) 9.7 19.3 (9.6) (5.6) Interest expense, net
Slide 21: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation ($ in millions) 2019 2018 2017 2016 2015 Net income $77.7 $73.9 $54.6 $30.6 $28.9 Income tax expense 13.8 1.3 18.0 21.3 19.5 Interest expense, net 33.4 32.1 25.2 22.1 11.4 Depreciation & amortization 59.5 52.3 43.1 37.0 31.2 EBITDA $184.4 $159.
Slide 22: Non-GAAP reconciliations
Non-GAAP reconciliations 2020 Organic Daily Sales Reconciliation 2020 2019 ($ in millions) FY’20 Q4’20 Q3’20 Q2’20 Q1’20 FY’19 Q4’19 Q3’19 Q2’19 Q1’19 Reported Net Sales -- -- $751.9 $817.7 $459.8 $2,357.5 $535.0 $652.8 $752.4 $417.3 A Organic Sales -- -- $698.3 $758.2 $434.8 $2,292.9 $513.6 $630.8
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