Resideo Technologies, Inc. · NYSE:REZI
Resideo Technologies — Q3 2023 Earnings Presentation
24 slides from Resideo Technologies's earnings presentation, Nov 1, 2023
Slide 1: Q3 2023 Results Presentation
Q3 2023 RESULTS PRESENTATION November 1, 2023
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains “forward-looking statements.” All statements, other than statements of fact, that address activities, events or developments that we or our management intend, expect, project, believe or anticipate will or may occur in the future are f
Slide 3: Resideo Q3 2023 Highlights
Resideo Q3 2023 Highlights • Financial results above midpoint of outlook range (excluding restructuring) • Sharpened focus on portfolio optimization • Driving further cost cutting initiatives to lower near-term and structural costs • Continue to enhance digital experience at ADI, supporting touchles
Slide 4: Products and Solutions Q3 2023 Highlights
Products and Solutions Q3 2023 Highlights • Sale of non-strategic Genesis Cable business and acquisition of Sfty, adding capabilities to European life safety services offerings • Increased content per home in new construction channel • Expanded partnerships with leading national insurance providers
Slide 5: ADI Global Distribution Q3 2023 Highlights
ADI Global Distribution Q3 2023 Highlights • E-commerce revenue grew 5% y/y; continued enhancement of digital customer experience • Opening of Dallas super center distribution hub providing capacity for growth, technology enhancements to support customer service, and improved supply chain efficiency
Slide 6: The Future of Living
The Future of Living Our 2nd Annual ESG Report, The Future of Living, demonstrates our continued commitment to helping protect what matters most and showcases our efforts and progress in the areas of: • product sustainability • environmental impact reductions • development of our Company culture • d
Slide 7: Q3 2023 Financial Summary
Q3 2023 Financial Summary ($ in millions, except per share) Q3 2023 Q3 2022 % change Y/Y Net Revenue 1,554 1,618 -4% P&S Revenue 654 707 -7% ADI Revenue 900 911 -1% Gross Margin 26.8% 26.6% +20bps P&S Gross Margin 38.7% 36.2% +250bps ADI Gross Margin 18.3% 19.3% -100bps Operating Profit 109 155 -30%
Slide 8: Resideo Key Financial Trends
Resideo Key Financial Trends $M Revenue -4% Y/Y $M Operating Profit -30% Y/Y Q3 2023 HIGHLIGHTS $1,700 $200 • Revenue slowed from softer end $1,600 $1,500 market demand across residential $150 $1,400 categories $1,300 $100 • Progress on input cost reductions $1,200 $1,100 $50 within Products and Sol
Slide 9: Products and Solutions Financial Trends
Products and Solutions Financial Trends P&S Revenue -7% P&S Gross Margin +250 Q3 2023 HIGHLIGHTS Y/Y bps $M $800 44% • Revenue down 7% y/y driven by 40% reduced Air and Energy product $700 volumes, partially offset by price $600 36% realization $500 32% $400 28% • Gross margin up 250 bps Q3 21 Q4 21
Slide 10: ADI Global Distribution Financial Trends
ADI Global Distribution Financial Trends ADI Revenue -1% ADI Gross Margin -100 Q3 2023 HIGHLIGHTS $M Y/Y bps $1,000 22% • Revenue down 1% y/y driven by $900 declines in residential security 18% category, offset by growth in $800 14% access control $700 $600 10% • E-commerce sales up 5% y/y, Q3 21 Q4
Slide 11: Balance Sheet and Cash Flow Summary (Unaudited)
Balance Sheet and Cash Flow Summary (Unaudited) ($ in millions) Sept 30, 2023 Dec 31, 2022 Oct 1, 2022 Cash and cash equivalents 368 326 255 Total debt 1,409 1,416 1,419 Accounts receivable, net 988 1,002 1,043 Inventories, net 970 975 957 Accounts payable 863 894 936 Cash provided (used) by operati
Slide 12: 2023 Outlook
2023 Outlook ($ in millions) Q4 2023 2023 UPDATED (1) 2023 PREVIOUS Revenue $1,495 to $1,545 $6,200 to $6,250 $6,190 to $6,290 Gross margin 26.0% to 27.0% 26.6% to 27.2% 26.2% to 27.2% GAAP operating profit $135 to $155 $535 to $555 $530 to $570 GAAP EPS $0.43 to $0.53 $1.30 to $1.41 $1.15 to $1.35
Slide 13: Improving the Business to Drive Long-Term Sustainable Value
Improving the Business to Drive Long-Term Sustainable Value • Navigating near-term cyclical headwinds • Optimizing portfolio to drive growth and profitability • Reducing input costs and operating expense to drive margin improvement • Expanding partnerships and long-term investments 13 Resideo Confid
Slide 14: Our Values
Our Values Start with Act as Pioneer Make a the customer one team the future difference We understand our We work together We embrace We care about the customers’ needs toward common change, boldly step long-lasting and pride ourselves goals, engaging from into the unknown, positive impact we on del
Slide 15: Appendix
APPENDIX 15 15 Resideo Resideo Confidential Confidential -- © © 2023 2023 Resideo Resideo Technologies, Technologies, Inc Inc
Slide 16: Summary Financial Results (Unaudited)
Summary Financial Results (Unaudited) (1) Q3 2023 YTD 2023 Products and ADI Global Products and ADI Global (in millions) Solutions Distribution Corporate Total Company Solutions Distribution Corporate Total Company Net revenue $ 654 $ 900 $ — $ 1,554 $ 1,989 $ 2,716 $ — $ 4,705 Cost of goods sold 40
Slide 17: Consolidated Interim Statements of Operations (Unaudited)
Consolidated Interim Statements of Operations (Unaudited) Three Months Ended Nine Months Ended (in millions, except per share data) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Net revenue $ 1,554 $ 1,618 $ 4,705 $ 4,810 Cost of goods sold 1,137 1,188 3,432 3,475 Gross profi
Slide 18: Consolidated Balance Sheets (Unaudited)
Consolidated Balance Sheets (Unaudited) (in millions, except par value) September 30, 2023 December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 368 $ 326 Accounts receivable, net 988 1,002 Inventories, net 970 975 Other current assets 289 199 Total current assets 2,615 2,502 Property
Slide 19: Consolidated Statements of Cash Flows (Unaudited)
Consolidated Statements of Cash Flows (Unaudited) Three Months Ended Nine Months Ended (in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Cash Flows From Operating Activities: Net income $ 21 $ 63 $ 128 $ 244 Adjustments to reconcile net income to net cash in operati
Slide 20: Non-GAAP Financial Measures and Reconciliations (Unaudited)
Non-GAAP Financial Measures and Reconciliations (Unaudited) Adjusted Net Income Per Diluted Common Share and Net Income Comparison Three Months Ended Nine Months Ended (in millions, except per share data) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 GAAP Net income applicabl
Slide 21: Non-GAAP Financial Measures and Reconciliations (Unaudited)
Non-GAAP Financial Measures and Reconciliations (Unaudited) Adjusted EBITDA Three Months Ended Nine Months Ended (in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Net revenue $ 1,554 $ 1,618 $ 4,705 $ 4,810 GAAP Net income applicable to common shares $ 21 $ 63 $ 128
Slide 22: Non-GAAP Financial Measures and Reconciliations (Unaudited)
Non-GAAP Financial Measures and Reconciliations (Unaudited) Products and Solutions Segment Three Months Ended Nine Months Ended (in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Net revenue $ 654 $ 707 $ 1,989 $ 2,090 GAAP Income from operations $ 107 $ 124 $ 352 $
Slide 23: Non-GAAP Financial Measures and Reconciliations (Unaudited)
Non-GAAP Financial Measures and Reconciliations (Unaudited) Adjusted Net Income Per Diluted Common Share Q4 2023 Fiscal Year 2023 (in millions, except per share data) Low High Low High GAAP Net income per diluted common share $ 0.43 $ 0.53 $ 1.30 $ 1.41 Restructuring and impairment expenses — — 0.28
Slide 24: Non-GAAP Financial Measures and Reconciliations (Unaudited)
Non-GAAP Financial Measures and Reconciliations (Unaudited) Non-GAAP Adjusted EBITDA Q4 2023 Fiscal Year 2023 (in millions) Low High Low High Net revenue $ 1,495 $ 1,545 $ 6,200 $ 6,250 GAAP Net income applicable to common shares $ 63 $ 79 $ 194 $ 210 Provision for income taxes 27 31 108 112 GAAP In