Worthington Enterprises, Inc. · NYSE:WOR
Worthington Enterprises — Worthington Industries — Jefferies Virtual Industrials Conference 2021
33 slides from Worthington Enterprises's conference presentation, Aug 3, 2021
Slide 1: Worthington Industries
Worthington Industries Joe Hayek – Chief Financial Officer 2021 Virtual Industrials Conference August 3, 2021
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT Worthington Industries wishes to take advantage of the Safe Harbor provisions included in the Private Securities Litigation Reform Act of 1995 (the “Act"). Statements by the Company which are not historical information constitute "forward looking statements" within the meaning
Slide 3: Vision
VISION TO BE THE TRANSFORMATIVE PARTNER FOR OUR CUSTOMERS, A POSITIVE FORCE IN OUR COMMUNITIES AND EARN EXCEPTIONAL RETURNS 3
Slide 4: $3.2 Billion Net Sales Fiscal 2021
4 NET SALES OF $3.2 BILLION FISCAL 2021 8,000 4,500 53 7 $483M ADJ. EBITDA FISCAL 2021
Slide 5: Corporate Citizenship & Sustainability
CORPORATE CITIZENSHIP & SUSTAINABILITY Long history of keeping employees safe, practicing good citizenship and protecting the environment Fiscal Year 2020 Highlights For more information on our Corporate Citizenship & Sustainability efforts, please see our first annual Corporate Citizenship & Sustai
Slide 6: $3.2B Fiscal 2021 Net Sales
$3.2B FISCAL 2021 NET SALES 05/31/21 NET SALES BY END-MARKETS OPERATING/EQUITY INCOME BY SEGMENT TTM* $411.3 MILLION 17% 17% 12% 51% 5% 19% 3% 2% 7% 30% 37% Automotive Construction Industrial Consumer Products Steel Cylinders WAVE / Other / JVs Agriculture Heavy Truck Oil & Gas Equipment Other * Exc
Slide 7: Profile: Steel Processing
STEEL PROCESSING PROFILE AUTO SALES BY END MARKET TTM 05/31/2021 $2.1B Wholly-Owned Consolidated JVs CAOGNRSI TCRUUL C TTU IROEN Unconsolidated JVs Automotive 57% 26 FACILITIES in North America (9 wholly owned / 17 JV Owned) Other CORE PRODUCTS 13% AGRICULTURE Carbon flat rolled steel processing - B
Slide 8: Profile: Pressure Cylinders
PRESSURE CYLINDERS PROFILE SALES BY SBU TTM 05/31/2021 $1.1B Industrial Products 13 FACILITIES 50% in North America and Europe Oil & Gas Equipment* 2% CORE PRODUCTS Consumer Products 48% Industrial Products - Broad line of pressure cylinders and tanks for industrial gas storage and transportation in
Slide 9: Pressure Cylinders Split Into Three Separate Reporting Segments
PRESSURE CYLINDERS SPLIT INTO THREE SEPARATE REPORTING SEGMENTS EFFECTIVE June 1, 2021 New segments will focus strategies around end-markets and improve reporting visibility 1. CONSUMER PRODUCTS – market-leading branded products in tools, outdoor living, and celebrations 2. BUILDING PRODUCTS – marke
Slide 10: Consumer Products Segment
CONSUMER PRODUCTS SEGMENT Market leading brands sold primarily through big-box retailers focused on tools, outdoor living and celebrations TOOLS OUTDOOR LIVING CELEBRATIONS Approximate (~38% of segment revenue) (~47% of segment revenue) (~15% of segment revenue) share of net sales Brands 16% 23% Pro
Slide 11: Building Products Segment
BUILDING PRODUCTS SEGMENT Broad array of market-leading commercial and residential building products primarily sold through distributors. Equity earnings of WAVE and ClarkDietrich joint-ventures will be reported as part of Building Products. Approximate Product families focused around share of • • R
Slide 12: Sustainable Energy Solutions Segment
SUSTAINABLE ENERGY SOLUTIONS SEGMENT Located in Europe and focused on providing turnkey solutions in the growing Hydrogen ecosystem and adjacent sustainable energies like compressed natural gas. Approximate Sustainable Energy Solutions share of • Attractive end-market with significant opportunities
Slide 13: Growth Strategy
GROWTH STRATEGY Working together using technology, analytics and automation enables us to deliver… Successful innovation, transformation, and acquisitions that drive value for customers and earn exceptional returns for our shareholders. All with Our Philosophy at the center. 1 3
Slide 14: Value Drivers in Action: Transformation
VALUE DRIVERS IN ACTION: TRANSFORMATION Data driven LEAN events to improve our businesses Example of Transformation project at cylinder facility conducted during pandemic Issue: Strong demand for Coleman® and Bernzomatic® camping gas tanks required transformation efforts to increase production in or
Slide 15: Value Drivers in Action: Innovation
VALUE DRIVERS IN ACTION: INNOVATION Focused effort has resulted in a growing pipeline of new products FUEL GAUGE SMARTLID™ COMFORT CARRY™ FOR CAMPING CYLINDERS INTEGRATED MONITORING SOLUTION PROPANE TANK Check fuel levels to avoid running out Check propane levels remotely Easier to handle, more attr
Slide 16: Recent Transactions That Will Improve Our Financial Performance
RECENT TRANSACTIONS THAT WILL IMPROVE OUR FINANCIAL PERFORMANCE AND STRENGTHEN LIQUIDITY ✓ Divested loss-making Engineered Cabs business – Nov. 2019 … ✓ Divested non-core, loss-making North American Cryogenic assets for proceeds of $21 million – Oct. 2020 ✓ Divested non-core, loss-making Oil & Gas E
Slide 17: Financial Goals
F IN A N CIA L G O A L S • GROW EBITDA & FREE CASH FLOW EVERY YEAR • 10%+ RETURN ON CAPITAL • RAISE MARGINS • REDUCE EARNINGS VOLATILITY • BALANCED CAPITAL ALLOCATION • MODEST LEVERAGE / AMPLE LIQUIDITY (INVESTMENT GRADE) • RIGOROUS CAPITAL DISCIPLINE 1 7
Slide 18: Balanced Capital Allocation Strategy
BALANCED CAPITAL ALLOCATION STRATEGY Strong cash flows and significant liquidity support balanced approach to capital allocation focused on growth and rewarding shareholders OVER $3 BILLION OF CAPITAL DEPLOYED IN PAST 10 YEARS SINCE START OF FY2012 ✓ Reinvest in the business to create value and supp
Slide 19: Consolidated Results
CONSOLIDATED RESULTS $ millions, except EPS FY2019 FY2020 FY2021 Sales $3,760 $3,059 $3,171 Adjusted EBITDA* $330 $300 $483 % of sales 8.8% 9.8% 15.2% Operating Income* $142 $115 $288 % of sales 3.8% 3.8% 9.1% EPS* $2.60 $2.39 $5.24 Avg Invested Capital $1,628 $1,532 $1,542 ROIC (Adj. EBIT/Avg. Inv.
Slide 20: Key Investment Highlights
KEY INVESTMENT HIGHLIGHTS Worthington offers an attractive investment opportunity • Growth strategy focused on value drivers of innovation, transformation and acquisition to enhance margins • Solid free cash flow and ample liquidity to execute on strategy • Rigorous capital discipline focused on hig
Slide 21: Supplemental Data
4 WORTHINGTON INDUSTRIES SUPPLEMENTAL DATA
Slide 22: Consolidated Adjusted EBITDA / Free Cash Flow
SUPPLEMENTAL DATA CONSOLIDATED ADJUSTED EBITDA / FREE CASH FLOW FY19 FY20 FY21 Annual Annual Annual Net Income $ 153.5 $ 78.8 $ 723.8 Interest Expense 38.1 31.6 30.3 Taxes 43.2 26.3 176.3 EBIT $ 234.7 $ 136.8 $ 930.4 D&A 95.6 92.7 87.7 EBITDA $ 330.3 $ 229.4 $ 1,018.1 Restructuring and non recurring
Slide 23: Consolidated Adjusted Operating Income / EPS
SUPPLEMENTAL DATA CONSOLIDATED ADJUSTED OPERATING INCOME / EPS $ millions, except EPS FY2019 FY2020 FY2021 Operating Income $145 $22 $168 Restructuring and non recurring* (3) 93 $120 Operating Income Adjusted $142 $115 $288 EPS $2.61 $1.41 $13.42 Restructuring and non recurring* (0.01) 0.98 (8.18) E
Slide 24: Financials: Steel Processing
S T E E L P R O C E S S I N G FINANCIALS $ millions FY2019 FY2020 FY2021 Sales $2,436 $1,860 $2,059 Adj. EBITDA* $122 $79 $233 % of sales* 5.0% 4.3% 11.3% Operating Income* $93 $46 $211 excl. Restructuring % of sales 3.8% 2.5% 10.2% Capital Expenditures $39 $41 $28 Avg Invested Capital $550 $512 $53
Slide 25: Financials: Pressure Cylinders
P R E S S U R E C Y L I N D E R S FINANCIALS $ millions FY2019 FY2020 FY2021 Sales $1,208 $1,148 $1,111 Adj. EBITDA* $105 $124 $116 % of sales* 8.7% 10.8% 10.4% Operating Income* $63 $81 $77 excl. Restructuring % of sales 5.3% 7.1% 6.9% Capital Expenditures $38 $41 $46 Avg Invested Capital $879 $869
Slide 26: Successful Joint Ventures
SUCCESSFUL JOINT VENTURES Serving building product and automotive end markets OVER • Successful JV portfolio built with trusted partners who help make a $1.0B business better versus the alternative of going solo • JVs managed to produce regular cash dividends that closely approximate earnings in div
Slide 27: Meaningful JV Earnings
MEANINGFUL JV EARNINGS Unconsolidated JVs managed to produce regular cash dividends that closely approximate earnings DIVIDEND to WII (CASH FLOW) $ MILLIONS $160 EQUITY EARNINGS* $140 *Excludes $123 Restructuring and $120 $110 $113 Impairment Charges $103 $101 $100 $96 $102 $101 $80 $90 $91 $60 $40
Slide 28: 87MM Cylinders & Accessories Manufactured
MANUFACTURED 87MM • CYLINDERS & • ACCESSORIES (FY21) SOLD IN 90+ COUNTRIES • • • • • • LARGEST PURCHASER OF FLAT ROLL STEEL BEHIND AUTOMAKERS 2 8
Slide 29: Value Drivers in Action: Innovation
VALUE DRIVERS IN ACTION: INNOVATION Focused effort has resulted in a growing pipeline of new products CLEAN CANNABIS FOURTIS® TYPE IV EXTRACTION CYLINDER MAX9 BUNDLE™ PROPANE CYLINDER Meets need for a cleaner Holds 25% more industrial gas Heating & cooking indoors globally alternative to carbon stee
Slide 30: Value Drivers in Action: Innovation
VALUE DRIVERS IN ACTION: INNOVATION Focused effort has resulted in a growing pipeline of new products ARMSTRONG VIDASHIELD UV24 AIR PURIFICATION SYSTEM
Slide 31: Value Drivers in Action: M&A (General Tools)
VALUE DRIVERS IN ACTION: M&A Acquired General Tools & Instruments on January 29, 2021, which complements our existing strong brands in consumer products and expands our reach in niche tools and outdoor living ✓ Market leader for feature-rich, specialized tools – Over 1,200 products ✓Attractive finan
Slide 32: Value Drivers in Action: M&A (BlankLight)
VALUE DRIVERS IN ACTION: M&A Acquired Shiloh’s U.S. BlankLight ® assets on June 8, 2021, which complements our laser welding joint -venture, TWB, by adding new capabilities to support the growing demand for tailor welded blanks and light weighting technology ✓ BlankLight is at the forefront of alumi
Slide 33: Contact / Safe Harbor Statement
CONTACT SAFE HARBOR STATEMENT Worthington Industries wishes to take advantage of the Safe Harbor provisions included in the Private Securities Litigation Reform Act of 1995 (the “Act"). Statements by the Company which are not historical information constitute "forward looking statements" within the
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