Knife Riv Holding Co. · NYSE:KNF
Knife Riv — Knife River Holding Company — Q2 2023 Earnings Presentation
15 slides from Knife Riv's earnings presentation, Aug 8, 2023
Slide 1: 2Q 2023 Earnings Presentation
2Q 2023 Earnings Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements The information in this presentation highlights the key growth strategies, projections and certain assumptions for the company and its subsidiaries. Many of these highlighted statements and other statements not historical in nature are “forward-looking statements” within t
Slide 3: Second Quarter Highlights
01 Second Quarter Highlights Record Second Quarter Revenue, Net Income, EBITDA and Backlog KEY DRIVERS RECORD RESULTS INCREASED 2023 GUIDANCE Revenue EBITDA1 Adj. EBITDA1 ‘Competitive EDGE’ REVENUE + 10% + 43% + 40% strategy drives profitable growth $2.6 BN – $2.8 BN $125.1 $126.3 ($In Millions) $78
Slide 4: Leading Integrated Materials and Services Provider
02 Leading Integrated Materials and Services Provider Aggregates-led, vertically integrated construction materials and contracting services company Well-established with track record of execution in mid-sized, high-growth markets Strong people-first culture Competitive EDGE plan for continued profit
Slide 5: EDGE: Framework for Long-Term Shareholder Value Creation
03 EDGE: Framework for Long-Term Shareholder Value Creation EBITDA Margin Discipline Growth Excellence Improvement EDGE 2025 Expectations STRONG AND BALANCED REVENUE GROWTH SIGNIFICANT ADJ. EBITDA MARGIN EXPANSION Increasing Mix of Aggregates ~15% by 2025 ATTRACTIVE CASH FLOW GENERATION SUSTAIN / IM
Slide 6: Second Quarter: Segment Overview
04 Second Quarter: Segment Overview Broad-Based Margin Expansion and Growth Across Segments North Pacific Northwest Mountain All Other1 Consolidated Central 2Q’23 Revenue $142.2 MM $179.0 MM $175.8 MM $187.6 MM $100.6 MM $785.2 MM 2Q’23 Revenue 11% 19% 3% 12% 6% 10% Growth 2Q’23 Adjusted $22.0 MM $4
Slide 7: Second Quarter: Segment Highlights
04 Second Quarter: Segment Highlights Implementation of EDGE ‒ Prices increasingly aligned with value of high-quality integrated product and services ‒ Disciplined and targeted bidding optimizing vertically integrated business model Robust Demand and Infrastructure Tailwinds ‒ Economic rebound in Ha
Slide 8: Product Lines
05 Product Lines Strong Growth and Margin Expansion Across Product Lines Average Selling Price1 Q2'23 Q2'22 % Change Volume Q2'23 Q2'22 % Change Aggregates (per ton) $15.95 $14.33 11% Aggregates (tons) 9,181 9,521 (-4%) Ready-mix concrete (per cubic yard) $166.11 $147.53 13% Ready-mix concrete (cubi
Slide 9: Capital Allocation Priorities
06 Capital Allocation Priorities Debt Schedule Q2 2023 IMPROVED FINANCIAL FLEXIBILITY Term Loan Agreement $275.0 Revolving credit agreement $155.0 Senior Notes $425.0 Other Notes $0.5 ACTIVE M&A PIPELINE Total Debt $855.5 Less: Cash and cash equivalents, excluding $40.1 restricted cash Net Debt $815
Slide 10: Guidance
07 Guidance KEY EXPECTED DRIVERS 2023 GUIDANCE REVENUE ($BN) $2.60 - ‘Competitive EDGE’ $2.80* REVENUE $2.18 $2.23 $2.54 $2.19 Price Strategy to Align with $1.93 Value of Products/Services $2.6 BN – $2.8 BN Operational Discipline – EBITDA1 Targeted Bid Strategy, Cost Focus $320 MM – $370 MM 2018 201
Slide 11: Appendix and Non-GAAP Financial Measures
APPENDIX AND NON-GAAP FINANCIAL MEASURES 11
Slide 12: Net Leverage
08 Net Leverage Twelve Months Ended Six Months Ended Twelve Months Ended Six Months Ended (In millions) June 30, 2023 June 30, 2023 December 31, 2022 June 30, 2022 Net income (loss) $133.2 $15.5 $116.2 $(1.5) Depreciation, depletion and amortization 120.4 60.7 117.8 58.1 Interest expense, net 44.1 2
Slide 13: Adjusted EBITDA
08 Adjusted EBITDA All Other and Three Months Ended June 30, 2023 Pacific Northwest Mountain North Central Intersegment Consolidated (in millions) Eliminations Net Income (loss) $ 16.5 $ 31.0 $ 26.4 $ 18.3 $ (35.4) $ 56.8 Depreciation, depletion and amortization 5.5 9.7 6.2 6.1 3.6 31.1 Interest exp
Slide 14: Adjusted EBITDA (Cont'd)
08 Adjusted EBITDA (Cont’d) All Other and Six Months Ended June 30, 2023 Pacific Northwest Mountain North Central Intersegment Consolidated (in millions) Eliminations Net Income (loss) $ 7.9 $ 35.2 $13.8 $ (10.9) $ (30.5) $ 15.5 Depreciation, depletion and amortization 11.0 18.6 12.1 11.8 7.2 60.7 I
Slide 15: Adjusted EBITDA (Cont'd)
08 Adjusted EBITDA (Cont’d) All Other and Twelve Months Ended June 30, 2023 Pacific Northwest Mountain North Central Intersegment Consolidated (in millions) Eliminations Net Income (loss) $ 32.0 $ 85.2 $ 54.3 $ 50.5 $ (88.8) $ 133.2 Depreciation, depletion and amortization 22.1 36.5 23.5 23.6 14.7 1
Knife River Holding Company — Q2 2023 Earnings Presentation on 6ix