Spectrum Brands Holdings, Inc. · NYSE:SPB
Spectrum Brands — Q2 2024 Earnings Presentation
29 slides from Spectrum Brands's earnings presentation, May 9, 2024
Slide 1: Fiscal 2024 Second Quarter Earnings Call
Fiscal 2024 Second Quarter Earnings Call May 9, 2024
Slide 2: Agenda
2 • Introduction – Joanne Chomiak Senior Vice President, Tax and Treasury Agenda • CEO Overview – David Maura Chairman and Chief Executive Officer • Financial & Business Review – Jeremy Smeltser Chief Financial Officer • Q&A – David Maura and Jeremy Smeltser
Slide 3: Forward-looking Statements
Forward-looking Statements 3 We have made or implied certain forward-looking statements in this document and may make additional oral forward-looking statements from time to time. All statements, other than statements of historical facts included or incorporated by reference in this document, includ
Slide 4: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 4 Management believes that certain non-GAAP financial measures may be useful in certain instances to provide additional meaningful comparisons between current results and results in prior operating periods. Within this document, including the tables that
Slide 5: CEO Overview
Spectrum Brands WE MAKE LIVING BETTER AT HOME™ CEO Overview David Maura
Slide 6: Q2 FY24 Headlines and Review
Q2 FY24 Headlines and Review 6 Summary Sequential sales improvement and stabilizing demand trends with encouraging early season sales for H&G Delivered Adjusted EBITDA of $112.3 million, up from $51 million, including investment income of $17 million Delivered Gross Margin of 38.1%, an improvement o
Slide 7: FY24 Strategic Priorities
FY24 Strategic Priorities 7 Improve operational efficiency Improve Capital investments to drive long operational term competitiveness efficiency Invest in Brands Invest in people and upgrade Invest Invest in talent Bring fewer bigger and innovate people and better innovations culture Drive a culture
Slide 8: Outstanding Shares & Share Repurchases
Outstanding Shares & Share Repurchases 8 Share Repurchases Repurchased 12.1Repurchased Million ASR – 6.6 Million 29.1 Million* 11.0 Million Open Market/10b5-1 – 5.5 Million Total Shares Outstanding ~ 29% Reduction 41.0 41.0Million Million $920 Million Spent Total TotalShares SharesOutstanding Ou
Slide 9: FY24 Earnings Framework
FY24 Earnings Framework 9 NET ADJUSTED SALE S EBITDA Low double-digit growth to Flat to prior year prior year Lower consumer demand in small Lower cost inventory and operational kitchen appliance category within HPC efficiencies partially offset by investment and North American Aquatics offset by in
Slide 10: Financial and Business Review
Financial and Business Review Jeremy Smeltser
Slide 11: Second Quarter 2024
Second Quarter 2024 11 KEY TAKEAWAYS Net Sales Ad j . E B I T D A • Decline in organic sales driven by decline in North American small kitchen -1.5% 120.2% appliances, softness in North American Aquatics, and exit of non-strategic categories and SKUs in GPC and HPC, $112M offset by strong POS in Con
Slide 12: Q2 FY24 Financial Review
Q2 FY24 Financial Review 12 Interest Expense -$14.7M vs. LY $32M $1.40B $1.25B $17M Debt outstanding Cash and short- Q2 FY23 Q2 FY24 term investments (1) Revolver usage(2) $10 M $490 M Cash strategic transactions, restructuring, and other unusual non-recurring items -$16.3M vs. LY In use Available $
Slide 13: Second Quarter 2024 Global Pet Care
Second Quarter 2024 Global Pet Care 13 Net Sales Ad j . E B I T D A KEY TAKEAWAYS -2.3% 34.6% • Organic net sales decrease driven by softness in North America Aquatics category and exit from non-strategic $297M $62M categories and SKU rationalization $290M $46M • EBITDA increase was driven by lower
Slide 14: Second Quarter 2024 Home & Garden
Second Quarter 2024 Home & Garden 14 Fourth Quarter 2023 N e t S a l e s Ad j . E B I T D A KEY TAKEAWAYS Home & Garden 4.8% 93.4% • Net sales increase due to favorable weather trends and POS in key regions partially offset by sales decline in household insect controls and $161M $29M repellents and
Slide 15: Second Quarter 2024 Home & Personal Care
Second Quarter 2024 Home & Personal Care 15 Net Sales Ad j . E B I T D A KEY TAKEAWAYS -4.0% +$19.7M • Organic net sales decline driven by global decline in Home Appliances most notably in North America partially $279M $18M offset by growth in Personal Care $268M • EBITDA increase was driven by lowe
Slide 16: FY24 Earnings Framework
FY24 Earnings Framework 16 NET ADJUSTED SALE S EBITDA Low double-digit growth Flat to prior year to prior year Lower consumer demand in small Lower cost inventory and operational kitchen appliance category within HPC efficiencies partially offset by and North American Aquatics offset by investment i
Slide 17: FY24 – Full Year Expectations
FY24 – Full Year Expectations 17 Cash Taxes Cash transactions CAPEX D&A ~$40M ~$50M $65M - $75M $115M - $125M Cash Payments of Capital Expenditures Depreciation and Cash Taxes Restructuring, Optimization Amortization and Strategic Initiatives
Slide 18: CEO Takeaways
Spectrum Brands WE MAKE LIVING BETTER AT HOME™ CEO Takeaways David Maura
Slide 19: CEO Key Takeaways
CEO Key Takeaways 19 S T R O N G F I R S T H AL F • Strategic playbook yielding results 1 • Improved margins and strengthened balance sheet continue to create a competitive advantage S E C O N D H AL F F O C U S • Invest in Commercial Operations to accelerate 2 long-term, sustainable top -line growt
Slide 20: Appendix
Spectrum Brands WE MAKE LIVING BETTER AT HOME™ Appendix
Slide 21: Condensed Consolidated Statements of Income
21 SPECTRUM BRANDS HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Month Periods Ended Six Month Periods Ended (in millions, except per share amounts) March 31, 2024 April 2, 2023 March 31, 2024 April 2, 2023 Net sales $ 718.5 $ 729.2 $ 1,410.7 $ 1,442.5 Cost of goods so
Slide 22: Condensed Consolidated Statements of Cash Flow
22 SPECTRUM BRANDS HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited) Six Month Periods Ended (in millions) March 31, 2024 April 2, 2023 Cash flows from operating activities Net cash provided by operating activities from continuing operations $ 80.7 $ 148.6 Net cash (used) pro
Slide 23: Condensed Consolidated Statements of Financial Position
23 SPECTRUM BRANDS HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) (in millions) March 31, 2024 September 30, 2023 Assets Cash and cash equivalents $ 745.7 $ 753.9 Short term investments 500.0 1,103.3 Trade receivables, net 601.3 477.1 Other receivables 113.5 84.5
Slide 24: Net Sales Summary and Organic Net Sales Reconciliation
24 SPECTRUM BRANDS HOLDINGS, INC. NET SALES SUMMARY (Unaudited) Three Month Periods Ended Six Month Periods Ended (in millions, except %) March 31, 2024 April 2, 2023 Variance March 31, 2024 April 2, 2023 Variance GPC $ 289.9 $ 296.7 $ (6.8) (2.3)% $ 566.8 $ 574.3 $ (7.5) (1.3)% H&G 160.7 153.3 7.4
Slide 25: Reconciliation of GAAP Net Income to Adjusted EBITDA – Q2 FY24
25 SPECTRUM BRANDS HOLDINGS, INC. RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited) Three Month Period Ended March 31, 2024 (in millions, except %) GPC H&G HPC Corporate Consolidated Net income (loss) from continuing operations $ 53.0 $ (14.6) $ 69.3 $ (57.8
Slide 26: Reconciliation of GAAP Net Income to Adjusted EBITDA – Q2 FY23
26 SPECTRUM BRANDS HOLDINGS, INC. RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited) Three Month Period Ended April 2, 2023 (in millions, except %) GPC H&G HPC Corporate Consolidated Net income (loss) from continuing operations $ 30.2 $ (39.8) $ (37.7) $ (27.
Slide 27: Reconciliation of GAAP Net Income to Adjusted EBITDA – Six Months FY24
27 SPECTRUM BRANDS HOLDINGS, INC. RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited) Six Month Period Ended March 31, 2024 (in millions, except %) GPC H&G HPC Corporate Consolidated Net income (loss) from continuing operations $ 96.6 $ (20.2) $ 85.2 $ (94.2)
Slide 28: Reconciliation of GAAP Net Income to Adjusted EBITDA – Six Months FY23
28 SPECTRUM BRANDS HOLDINGS, INC. RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited) Six Month Period Ended April 2, 2023 (in millions, except % GPC H&G HPC Corporate Consolidated Net income (loss) from continuing operations $ 53.3 $ (47.0) $ (41.8) $ (79.5)
Slide 29: Reconciliation of GAAP Diluted EPS to Adjusted Diluted EPS
29 SPECTRUM BRANDS HOLDINGS, INC. RECONCILIATION OF GAAP DILUTED EARNINGS PER SHARE TO ADJUSTED DILUTED EARNINGS PER SHARE (Unaudited) Three Month Periods Ended Six Month Periods Ended March 31, 2024 April 2, 2023 March 31, 2024 April 2, 2023 Diluted EPS from continuing operations, as reported $ 1.6
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