Rpm International Inc. · NYSE:RPM
Rpm International — Q3 2024 Earnings Presentation
30 slides from Rpm International's earnings presentation, Apr 4, 2024
Slide 1: Fiscal 2024 Third-Quarter Results
Fiscal 2024 Third-Quarter Results April 4, 2024
Slide 2: Forward-Looking Statements & Regulation G
Forward-Looking Statements & Regulation G This presentation contains “forward-looking statements” relating to our business. These forward-looking statements, or other statements made by us, are made based on our expectations and beliefs concerning future events impacting us and are subject to uncert
Slide 3: Record Consolidated Q3-24 Sales and Adjusted EBIT
Record Consolidated Q3-24 Sales and Adjusted EBIT Q3-24 FINANCIAL HIGHLIGHTS Consolidated Sales and Adjusted EBIT Growth 40% Sales Growth Adj. EBIT Growth(1) 36.4% 35% 33.1% 31.3% $1.52B 30% 25% RECORD Q3 SALES +0.4% FROM PY 20% 17.1% 15% 13.0% 13.7% 11.7% 12.3% 9.3% 10.4% 9 Consecutive 10% Quarters
Slide 4: Strong Execution and MAP 2025 Drive Record Consolidated Results
Strong Execution and MAP 2025 Drive Record Consolidated Results CPG PCG SPG Consumer Consolidated Increased R&D Record Sales Q3-24 Record Adjusted EBIT¹ Q3-24 HIGHLIGHTS • Record Q3 consolidated sales with strength in engineered solutions serving infrastructure, reshoring and high-performance buildi
Slide 5: Sales Growth in USD by Region | Q3-24
Sales Growth in USD by Region | Q3-24 EUROPE NORTH AMERICA 15% of total sales 76% of total sales -1.5% -0.5% ASIA/PACIFIC 3% of total sales +5.0% AFRICA/MIDDLE EAST/ OTHER FOREIGN 1% of total sales LATIN AMERICA +22.9% 5% of total sales +13.5% Fiscal 2024 Third-Quarter Results | April 4, 2024 5
Slide 6: Fiscal 2024 Third-Quarter Financial Results | Consolidated
Fiscal 2024 Third-Quarter Financial Results | Consolidated Record Q3 sales and adjusted EBIT ($ in millions, except Q3 Q3 KEY POINTS 2024 2023 % Change per share amounts) • Record Q3 sales led by volume growth in CPG & PCG and positive pricing in all segments to catch up with Sales $1,523 $1,516 +0.
Slide 7: Construction Products Group Third-Quarter Financial Results
Fiscal 2024 Third-Quarter Financial Results Record sales with increased demand from infrastructure and reshoring projects Q3 Q3 ($ in millions, except margins) % Change Sales Components CONSTRUCTION 2024 2023 PRODUCTS GROUP Sales $495.8 $475.2 +4.3% Organic +3.1% EBIT1 $15.7 $10.4 +51.2% Acquisition
Slide 8: Performance Coatings Group Third-Quarter Financial Results
Fiscal 2024 Third-Quarter Financial Results Record Q3 results driven by strong demand for engineered solutions and MAP 2025 benefits PERFORMANCE ($ in millions, except margins) Q3 2024 Q3 2023 % Change Sales Components COATINGS GROUP Sales $343.5 $321.5 +6.9% Organic +9.2% EBIT1 $45.8 -$7.6 N/A Dive
Slide 9: Specialty Products Group Third-Quarter Financial Results
Fiscal 2024 Third-Quarter Financial Results Challenging comparisons in disaster restoration business SPECIALTY ($ in millions, except margins) Q3 2024 Q3 2023 % Change Sales Components PRODUCTS GROUP Sales $176.5 $191.0 -7.6% Organic -6.4% EBIT1 $9.7 $39.5 -75.4% Divestitures -1.4% Adjusted EBIT1 $1
Slide 10: Consumer Group Third-Quarter Financial Results
Fiscal 2024 Third-Quarter Financial Results MAP 2025 drove adjusted EBIT growth despite soft DIY demand Q3 Q3 CONSUMER ($ in millions, except margins) 2024 2023 % Change Sales Components GROUP Sales $507.2 $528.5 -4.0% Organic -3.2% EBIT1 $64.2 $68.1 -5.8% Acquisitions 0.0% Adjusted EBIT1 $65.0 $48.
Slide 11: Working Capital Management Results in All-Time Record Cash Flow from Operations
Working Capital Management Results in All-Time Record Cash Flow from Operations Inventories $1,400 Q3-24 Update $1,300 • Trailing 12-month cash flow from operating activities an all-time record at $1.26 billion $1,200 • 4th consecutive quarter of record cash flow from In millions operating activitie
Slide 12: New Plants Meet Growing Asian Market Demand
New Plants Meet Growing Asian Market Demand New Malaysian Plant • Aligned under single management structure • Improves costs and responsiveness • Construction with sustainability focus • Scheduled opening in FY25 • Supporting multiple RPM brands New Indian Plant RPM providing engineered solutions fo
Slide 13: Outlook – Q4 and FY24
Outlook – Q4 and FY24 Q4-24 Q4-24 OUTLOOK (YOY) PRIOR-YEAR RECORD SALES | Consolidated Approximately Flat Construction Products Group +LSD % to +MSD% Performance Coatings Group Approximately Flat Specialty Products Group -MSD % Consumer Group -MSD % ADJUSTED EBIT | Consolidated +HSD % Expected Trend
Slide 14: Appendix: Reconciliation of Non-GAAP to GAAP Measures
Appendix Reconciliation of Non-GAAP to GAAP Measures
Slide 15: Consolidated Statements of Income: Three Months
Consolidated Statements of Income: Three Months ($ in thousands, except per share and percent data) (Unaudited) Three Months Ended February 29, 2024 % February 28, 2023 % % Change Net Sales $ 1,522,982 $ 1,516,176 0.4 Cost of Sales 915,818 60.1 978,142 64.5 Gross Profit 607,164 39.9 538,034 35.5 SG&
Slide 16: Consolidated Statements of Income: Nine Months
Consolidated Statements of Income: Nine Months ($ in thousands, except per share and percent data) (Unaudited) Nine Months Ended February 29, 2024 % February 28, 2023 % % Change Net Sales $ 5,327,114 $ 5,240,204 1.7 Cost of Sales 3,143,105 59.0 3,267,308 62.4 Gross Profit 2,184,009 41.0 1,972,896 37
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures The following are the non-GAAP financial measures used in this presentation: *Interest (Income) Expense, Net includes the combination of interest (income) expense and investment (income) expense, net. **EBIT is defined as earnings (loss) before interest and taxes. Managem
Slide 18: Adjustments Detail
Adjustments Detail a. Includes charges incurred related to headcount reductions, facility closures and asset impairments recorded in "Restructuring Expense" on the Consolidated Statements of Income. Restructuring Expense totaled $6.4 million and $4.2 million for the quarters ended February 29, 2024
Slide 19: Reconciliation of Reported to Adjusted EPS: Three Months
Reconciliation of "Reported" to "Adjusted" EPS: Three Months (Unaudited) Reconciliation of Reported Earnings per Diluted Share to Adjusted Three Months Ended Earnings per Diluted Share (All amounts presented after-tax): February 29, 2024 February 28, 2023 Reported Earnings per Diluted Share $ 0.47 $
Slide 20: Reconciliation of Reported to Adjusted EPS: Nine Months
Reconciliation of "Reported" to "Adjusted" EPS: Nine Months (Unaudited) Reconciliation of Reported Earnings per Diluted Share to Adjusted Nine Months Ended Earnings per Diluted Share (All amounts presented after-tax): February 29, 2024 February 28, 2023 Reported Earnings per Diluted Share $ 3.16 $ 2
Slide 21: EBIT (Non-GAAP): RPM Consolidated: Three Months
EBIT** (Non-GAAP Measure): RPM Consolidated: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended February 29, 2024 February 28, 2023 Net Income $ 61,478 $ 27,239 Provision for Income Taxes 22,103 15,248 Income Before Income Taxes 83,581 42,487 Interest Expense 28,527 30
Slide 22: EBIT (Non-GAAP): RPM Consolidated: Nine Months
EBIT** (Non-GAAP Measure): RPM Consolidated: Nine Months ($ in thousands, except percent data) (Unaudited) Nine Months Ended February 29, 2024 February 28, 2023 Net Income $ 408,606 $ 328,060 Provision for Income Taxes 139,953 114,683 Income Before Income Taxes 548,559 442,743 Interest Expense 90,69
Slide 23: EBIT (Non-GAAP): Construction Products Segment: Three Months
EBIT** (Non-GAAP Measure): Construction Products Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 15,060 $ 6,886 Add: Interest Expense, Net* 668 3,513 EBIT** (non-GAAP measure) 15,728 10,399 Re
Slide 24: EBIT (Non-GAAP): Construction Products Segment: Nine Months
EBIT** (Non-GAAP Measure): Construction Products Segment: Nine Months ($ in thousands, except percent data) (Unaudited) Nine Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 253,910 $ 187,679 Add: Interest Expense, Net* 4,619 8,090 EBIT** (non-GAAP measure) 258,529 195,7
Slide 25: EBIT (Non-GAAP): Performance Coatings Segment: Three Months
EBIT** (Non-GAAP Measure): Performance Coatings Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended February 29, 2024 February 28, 2023 Income (Loss) Before Income Taxes $ 47,039 $ (7,057) Add: Interest (Income), Net* (1,204) (531) EBIT** (non-GAAP measure) 45,
Slide 26: EBIT (Non-GAAP): Performance Coatings Segment: Nine Months
EBIT** (Non-GAAP Measure): Performance Coatings Segment: Nine Months ($ in thousands, except percent data) (Unaudited) Nine Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 153,362 $ 89,053 Add: Interest (Income), Net* (3,753) (1,058) EBIT** (non-GAAP measure) 149,609 87
Slide 27: EBIT (Non-GAAP): Specialty Products Segment: Three Months
EBIT** (Non-GAAP Measure): Specialty Products Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 9,803 $ 39,482 Add: Interest (Income), Net* (90) (28) EBIT** (non-GAAP measure) 9,713 39,454 Restr
Slide 28: EBIT (Non-GAAP): Specialty Products Segment: Nine Months
EBIT** (Non-GAAP Measure): Specialty Products Segment: Nine Months ($ in thousands, except percent data) (Unaudited) Nine Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 36,345 $ 94,798 Add: Interest (Income), Net* (293) (23) EBIT** (non-GAAP measure) 36,052 94,775 Rest
Slide 29: EBIT (Non-GAAP): Consumer Segment: Three Months
EBIT** (Non-GAAP Measure): Consumer Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 65,159 $ 68,146 Add: Interest (Income), Net* (1,000) (18) EBIT** (non-GAAP measure) 64,159 68,128 Restructur
Slide 30: EBIT (Non-GAAP): Consumer Segment: Nine Months
EBIT** (Non-GAAP Measure): Consumer Segment: Nine Months ($ in thousands, except percent data) (Unaudited) Nine Months Ended February 29, 2024 February 28, 2023 Income Before Income Taxes $ 295,054 $ 278,708 Add: Interest (Income), Net* (2,619) (45) EBIT** (non-GAAP measure) 292,435 278,663 Restruct