16 slides from A.o. Smith's earnings presentation, Jul 23, 2024
Slide 1: Second Quarter 2024 Results
Second Quarter 2024 Results July 23, 2024 2nd Quarter 2024 Earnings Presentation 1
Slide 2: Presenters
Kevin J. Wheeler Charles T. Lauber Helen E. Gurholt Chairman and Executive Vice President Vice President - Investor Relations, Chief Executive Officer and Chief Financial Officer Financial Planning & Analysis 2nd Quarter 2024 Earnings Presentation 2
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements generally can be identified by the use of words such as “may,” “will,” “expect,” “
Slide 4: Second Quarter Messages
Second Quarter Messages 1 2 3 4 5 Record sales of North American China achieved India achieved Pureit to be $1B and strong water heater and third-party local local currency acquired by the EPS of $1.06 boiler sales currency sales sales growth of end of 2024 increased 10% growth of 2% 16% 2nd Quarter
Slide 5: Second Quarter Performance and Highlights
Second Quarter Performance and Highlights Sales Adjusted EPS Segment Sales Segment Earnings $1,024 $1.06 $961 $1.01 $791M $198M 7% 5% YOY YOY $245M $26M Q2 2023 Q2 2024 Q2 2023 Q2 2024 North America Rest of World North America Rest of World Highlights North America Rest of World • Net sales up 7 per
Slide 6: A. O. Smith Values recognized in 2024
A. O. Smith Values recognized in 2024 Live our Values • Achieve profitable growth • Emphasize innovation • Preserve our good name • Be a good place to work • Be a good citizen 2nd Quarter 2024 Earnings Presentation 6
Slide 7: Second Quarter North America Segment
Second Quarter North America Segment Segment Sales ($M) Adjusted Segment Operating Earnings ($M) 9% YOY 26.9% 25.1% • Sales increase primarily due to higher water heater volumes and • Earnings increase driven by higher volumes partially offset by higher pricing actions material costs • Began shippin
Slide 8: Second Quarter Rest of World Segment
Second Quarter Rest of World Segment Segment Sales ($M) Segment Operating Earnings ($M) 2% YOY 11.6% 10.6% • China sales grew 2% driven by kitchen appliance and HVAC sales, • Earnings benefits from higher volumes of kitchen products in China partially offset by residential water treatment offset by
Slide 9: Cash Flow and Liquidity
Cash Flow and Liquidity1 $233M Free Cash Flow ($M) Cash Flow From Operations ($M) Cash balance2 $260 $236 6.8% Debt to capital ratio $164 $119 $93M Net cash position ~1.8M 2023 2024 2023 2024 Shares repurchased in 2024 totaling ~$153M 1As of June 30, 2024. 2Includes cash, cash equivalents and market
Slide 10: Capital Allocation Priorities
Capital Allocation Priorities Organic Growth • Opportunities for organic growth in all our businesses and geographies • Disciplined focus on transactions that expand/grow the core, enable geographic growth, and establish adjacencies Acquisitions • Recent transactions: Impact Water and Water Tec; Pur
Slide 11: 2024 Outlook and Assumptions
2024 Outlook and Assumptions1 Revenue Increase ~3% to 5% 2024 Guidance 2023 U.S. Residential Water Heater Industry Flat Commercial Water Heater Industry + LSD China Sales Growth (Local Currency) ~Flat to 3% Diluted EPS (GAAP) $3.95 - $4.10 $3.69 North American Boiler Sales Growth ~8% to 10% North Am
Slide 12: Powerful Investment Thesis
Powerful Investment Thesis 1 2 3 4 5 Leading with Capitalizing Leading Compelling Leveraging strong innovative on global North American brand awareness balance sheet for products megatrends in a water heater and in emerging organic that drive large and growing boiler producer markets with and inorga
Slide 13: A. O. Smith. Innovation has a name.
(X6 Smith. Innovation has a name.
Slide 14: Adjusted Earnings and Adjusted EPS
Adjusted Earnings and Adjusted EPS ($ in Millions, except per share data) 2nd Quarter 2024 Earnings Presentation 14
Slide 15: Adjusted Segment Earnings
Adjusted Segment Earnings ($ in Millions) 2nd Quarter 2024 Earnings Presentation 15
Slide 16: Free Cash Flow
Free Cash Flow ($ in Millions) 2nd Quarter 2024 Earnings Presentation 16