Adentra Inc · TSX:ADEN
Adentra — Q4 2024 Earnings Presentation
28 slides from Adentra's earnings presentation, Mar 14, 2025
Slide 1: Investor Presentation March 2025
CREATING BEAUTIFUL SPACES WHERE WE LIVE, InvestorAND WORK, Presentation PLAY March 2025 TSX : ADEN Calgary Public Library: Ceilings, wall panels, and stairs by ADENTRA
Slide 2: Forward-Looking Statements, Third-Party Information, Notice to Reader
our current credit facilities are sufficient to finance our working capital needs and market a result of our operations; an outbreak or escalation of a contagious disease may adversely expansion strategy; The fair value of non-current receivables, notes payable, other liabilities affect our business
Slide 3: Creating beautiful spaces where we live, work, and play
Creating beautiful spaces where we live, work, and play From top left: Sacramento Airport - Sacramento, CA; Signal House – Newport Beach, CA; Microsoft Canada Excellence Centre – Vancouver, B.C.; Health Sciences Innovation Building, University of Arizona – 3 Tucson, AZ; Lincolnshire House – Toronto,
Slide 4: Why Invest in ADENTRA
Why Invest in ADENTRA Architectural Building Well-Positioned to Active Strategies to Track Record of Industry Leader Product Focus Capture Market Share Accelerate Growth Financial Performance ✓ We maintain a differentiated ✓ Our specialty products are ✓ We hold a single-digit market ✓ Clear strategy
Slide 5: ADENTRA Snapshot (TSX: ADEN)
ADENTRA Snapshot (TSX: ADEN) $2.2B $184M $148M C$759M Sales Adj. EBITDA1 Operating Cash flows Market Cap2 60,000+ 3,000+ 190,000+ Customers Employees SKUs in portfolio 14% 40% Home Centers Repair & Remodel 13% Essential End- Commercial Customer Market Channels Access 7% 86 92 / 8 800+ 55% 31% 40% Di
Slide 6: A world-class platform of architectural building products
Our unique customer-centric A world-class 2,500 insights inform leading product 60,000+ solutions platform of SUPPLIERS CUSTOMERS Access to North Includes branded products, Access to our extensive architectural American markets exclusive rights and 190,000+ SKU product portfolio building demonstrate
Slide 7: Product Offerings
Product Offerings Broad product participation, emphasis on specialty materials 7% outdoor 9% living boards 13% ✓ Extensive 190,000+ SKU diversified 17% doors product portfolio 11% mouldings $2.2B 2024 Sales ✓ 50% of products are branded, exclusive, or semi- exclusive 4% stairparts 15% hardwood plywo
Slide 8: Opportunity to Capture New Market Share
Opportunity to Capture New Market Share Outdoor Living $0.9B 17.1% Market Share $2.2B $5.5B 3.2% Diversified Market Market Share Mouldings $6.9B 3.5% Stair Parts $1.3B Market 6.7% Share Market Share $6.9B Market $2.2B 2024 Sales Composites $1.0B 8.7% Market Share Decorative Surfaces $6.5B Market 4.0
Slide 9: Total Addressable Market - Customer Channel
Total Addressable Market - Customer Channel $43B Industrial • Segment includes OEM manufacturers, commercial Home Center millwork shops, specialty dealers/fabricators, and $10B lumber yards Pro Dealer $16B Pro Dealer • Segment includes one/two-step distributors and Industrial millwork wholesalers $1
Slide 10: Long-Term End-Market Fundamentals Remain Positive
Long-Term End-Market Fundamentals Remain Positive New U.S. Housing Starts and Cumulative Aging U.S. Housing Stock & Annual Average Rate on 30-year Underbuild1 Strong Home Equity Levels2 Fixed-Rate Mortgages1 (%) Units (millions) Average Age Home Equity Interest Rate 3500 (years) (US$Trillions) (%) 3
Slide 11: Our Growth Strategies
Our Growth Strategies Leveraging our platform in multiple areas… Global Sourcing Vendor Management Digital Engagement Sales and Marketing Acquisitions Expanding our product offerings Growing share with existing customers Capturing market share Executing on acquisitions …To create and sustain our com
Slide 12: Global Sourcing from over 30 Countries
Global Sourcing from over 30 Countries Global sourcing is a core competency and a sustainable advantage for ADENTRA • One-stop importer that creates value for vendors • We find global supply options that meet customers’ specific needs • We can create in-house brands for certain products • As a direc
Slide 13: Leading the Digital Customer Experience
Leading the Digital Customer Experience Historic Industry Model Future Business Model: Full Digital Engagement with Customers • The architectural building products • Customers now expect E-commerce sites to • Comprehensive digital engagement and industry has been slow to adopt E- conduct product res
Slide 14: Demonstrated Growth Through Acquisition
Demonstrated Growth Through Acquisition Track Record – Sales Acquired (US$ millions) Significant market share available in a highly fragmented industry Clear investment criteria EAGLE PLY 670 Architectural products in adjacent/complimentary categories Primary focus on 282 270 distribution, complemen
Slide 15: Woolf Distributing Company Overview
Woolf Distributing Company Overview • Woolf acquisition completed on July 29, 2024 for $130M. • Immediately accretive to adj. EBITDA margin and high-single-digit accretion to adj. earnings per share. • Expands footprint in the US Midwest with the addition of 4 locations. • Adds complementary millwor
Slide 16: Destination 2028 Sales Target
$3.5B $636M $500M $2.2B1 $164M “Destination 2028” Sales Target 2023 Sales Organic Growth Woolf Future e2028 Run Rate Acquisitions Sales Key • Market growth and strategic initiatives driving mid-single-digit “Organic Growth” Assumptions: • “Acquisitions” supported by our expected cash flows and balan
Slide 17: Our Target Financial KPIs
Sales CAGR1 Gross Margin2 EBITDA Margin2,5 +9% +20% +10% Our Target Leverage3,5 Financial KPIs Range Operating Cash flow before changes in working capital Average ROIC4,5 2-3X +$1B +12% Focused on delivering profitable growth and creating shareholder value 1. Sales CAGR is calculated on sales growth
Slide 18: Financial Performance Summary
1. 2. Proven track record of Strengthening gross achieving margin percentage multi-year growth Financial Performance 3. 4. Summary Strong and predictable Efficient and cash flow generation responsible underpins our capital balance sheet allocation Strong operational and financial execution creates l
Slide 19: As we have expanded our capabilities, we have strengthened performance
Sales Growth Consistent Earnings Growth As we have 20% 13% expanded our Five-year Sales CAGR1 Five-year Earnings per Share CAGR1 capabilities, we have strengthened Strong Balance Sheet Dividend Growth our financial 2.4x 12% performance. Net Debt to Adj. EBITDA after rents2,3 Five-year dividend CAGR1
Slide 20: Track record of growth and improving margins
Sales and Gross Margin US Millions $3,000 25.0% Supported by our M&A $2,500 strategy and focus on 20.0% operational efficiency, we have achieved gross $2,000 Track record 15.0% margin percentages exceeding of growth and 20% $1,500 10.0% improving margins. $1,000 5.0% $500 for the past 4 years. $0 0.
Slide 21: Platform drives strong and growing cash flow
1 Adjusted EBITDA and Operating Cash Flow before Changes in Working Capital US Millions $300 1 Adjusted EBITDA $250 Operating Cash Flow Before Changes In Working Capital Conversion of Adjusted EBITDA1into Operating $200 Cash Flow before changes Platform drives in working capital averages 75% $150 st
Slide 22: Responsible Leverage and Significant Liquidity
Responsible Leverage and Significant Liquidity Net Debt / Adjusted EBITDA after Rents1 3.0x 2.7x 2.5x 2.4x 2.4x 2.4x 2.0x 2.4x +$425 M 1.5x 1.4x 2024 Unused borrowing capacity Net Debt/Pro-Forma Adjusted & cash on hand 1.0x EBITDA after rents1 (December 31, 2024) 0.5x 0.0x Responsibly managed balanc
Slide 23: Investor Relations
TSX Ticker Symbol ADEN Shares Outstanding1 25,068,668 Market Capitalization1 C$758.5 million Available Liquidity2 +$425 million Investor Relations Website www.ADENTRAgroup.com investors@ADENTRAgroup.com Calgary Public Library: 1. Calculated using share count and closing price for the Company’s commo
Slide 24: Appendix
APPENDIX Decorative surfaces by ADENTRA 24
Slide 25: Destination 2028 Capital Allocation
$1 billion in Operating Cash Flow before changes in Working Capital Investments in the Business $ 200 • Maintenance capex & working capital Rent payments $ 300 • Includes leased facilities “Destination 2028” Capital Allocation Acquisitions • Financed from cash flows and strength of balance sheet • E
Slide 26: Proven Approach to Building Value through M&A
Proven Approach to Building Value through M&A EXAMPLE TRANSACTION RESULTS 16% $82 ✓ Leveraged purchasing power to increase product Sales CAGR access and secure favorable pricing $53 ✓ Growth in key product categories ✓ Consolidation of insurance, benefits, accounting, tax planning ✓ Adj. EBITDA1 mar
Slide 27: Total Addressable Market – Regional
Total Addressable Market – Regional CANADA $43B ~$5.2B Total Addressable Market ‘17-’27 CAGR: 1.6% ADENTRA Sales: $262M • ADENTRA has multiple brands and Locations: 8 business locations in each key region MIDWEST N. EAST • Strong market presence, position and ~$7.4B ~$5.5B share in Canada ‘17-’27 CA
Slide 28: Market Potential for our Transformed Business
Market Potential for our Transformed Business Future Addressable Market Value Future Addressable Market (more products, more value chain • All building material exposure, regional expansion) product categories across all channels and North American regions at the manufacturer level $43B Total Addres