Tennant Company · NYSE:TNC
Tennant — Q1 2019 Earnings Presentation
16 slides from Tennant's earnings presentation, Apr 30, 2019
Slide 1: Earnings Release Conference Call First Quarter 2019
TENNANT COMPANY Earnings Release Conference Call First Quarter 2019 Tuesday, April 30, 2019 TENNANT COMPANY 1
Slide 2: On the Call Today
On the Call Today Chris Killingstad Keith Woodward President and CEO Senior VP and CFO TENNANT COMPANY 2
Slide 3: Forward-Looking Statements & Non-GAAP Measures
Forward-Looking Our remarks this morning and our answers to questions may contain forward-looking statements regarding the company’s expectations of future performance. Such statements are subject to risks and uncertainties, and our actual results may differ Statements & materially from those contai
Slide 4: Earnings Release Conference Call First Quarter 2019
TENNANT COMPANY Earnings Release Conference Call First Quarter 2019 Tuesday, April 30, 2019 TENNANT COMPANY 4
Slide 5: First Quarter 2019 – Results
First Quarter 2019 – Results • Net sales decline • Negative organic and currency impact • Organic softness due to challenging sales comparison and industry market softness in UK • EBITDA expansion • Focused on prioritizing sales efforts where our value proposition is strongest • Optimizing our opera
Slide 6: First Quarter 2019 – Results
First Quarter 2019 – Results • Gross margins • Increase of 120 bps over prior-year period • Macro-driven factors: tariffs, tight skilled-labor market, material inflation and higher freight costs • Positive impacts: pricing actions, favorable channel mix and efforts to mitigate headwinds • EBITDA exp
Slide 7: First Quarter 2019 – Announcements
First Quarter 2019 – Announcements T7 Autonomous Machine Corporate Headquarters • Q1 announcement of Walmart • Ability to repurpose our current headquarters agreement • Accommodate additional growth • Promising and emerging trend • Help attract and retain talent • Believe to have first-mover advanta
Slide 8: Earnings Release Conference Call First Quarter 2019
TENNANT COMPANY Earnings Release Conference Call First Quarter 2019 Tuesday, April 30, 2019 TENNANT COMPANY 8
Slide 9: First Quarter 2019 – Sales | Adjusted EPS
First Quarter 2019 – Sales | Adjusted EPS Q1 '19 Organic Growth of (0.8%) Q1 '19 Q1 '18 CHANGE SALES $262.5 M $272.8 M -3.8% EPS Adjusted* $0.49 $0.27 +82% Q1 2019 Results • Organic results exclude unfavorable currency of 3.4% • First-quarter 2019 reported net earnings grew 64 percent to $5.4 millio
Slide 10: First Quarter 2019 – Geographies
First Quarter 2019 – Geographies The Americas • Sales declined 1.1%, or +0.3% organically, driven by: • Strong Latin America sales, with strength in Mexico • Challenging comparison to last year • Walmart autonomous T7 announcement did not contribute significantly to the quarter EMEA • Sales declined
Slide 11: First Quarter 2019 – Sales | Adjusted Gross Margin
First Quarter 2019 – Sales | Adjusted Gross Margin Q1 '19 Q1 '18 CHANGE SALES $262.5 M $272.8 M -3.8% Gross Margin Adjusted* 41.2% 40.0% +120 bps 2019 Results • 120 bps improvement – Favorable channel mix – Positive pricing actions – Mitigation efforts to offset macro headwinds TENNANT COMPANY * See
Slide 12: First Quarter 2019 – Sales | R&D | S&A
First Quarter 2019 – Sales | R&D | S&A Q1 '19 Q1 '18 CHANGE SALES $262.5 M $272.8 M -3.8% R&D Expense (% of sales) 2.7% 2.9% -20 bps S&A Expense (% of sales) - Adjusted* $85.2 M $88.5 M -3.7% • R&D at levels that allow us to remain competitive, meet customer needs and support our leadership position
Slide 13: First Quarter 2019 – EBITDA | Other Financial Metrics
First Quarter 2019 – EBITDA | Other Financial Metrics 2019 2018 CHANGE Q1 Adjusted EBITDA* $29.5 M $25.2 M +17% Q1 Adjusted EBITDA* (% of sales) 11.2% 9.2% +200 bps Tennant Committed to Improve Profitability By: – Driving organic revenue growth – Driving operational cost leverage – Working to offset
Slide 14: 2019 Guidance
2019 Guidance • Full Year Sales of $1.15 billion to $1.17 billion (2% to 3% organic) • Adjusted Earnings per Share of $2.30 to $2.50 • GAAP Earnings per Share of $2.05 to $2.25 • Adjusted EBITDA of $129 million to $133 million • Other Key Assumptions • Capital expenditures of approximately $40 to $4
Slide 15: Questions
Questions TENNANT COMPANY 15
Slide 16: Thank You
Thank You TENNANT COMPANY TENNANT.