Slide 1: Q4 & FY 2022 Earnings Call
Q4 & FY 2022 Earnings Call March 7, 2023
Slide 2: Disclaimer
Disclaimer Forward-looking Statements Certain statements in this presentation constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation other than statements of historical fact may constitute forwar
Slide 3: FY 2022 Highlights
FY 2022 Highlights Net Sales ($ in millions) +10% YoY Growth Product Leadership $696 • Delivered year-over-year net sales growth across all three product lines $630 Fiberglass Conversion • Grew fiberglass volume, overcoming a year-over-year decline in the industry for U.S. in- ground pool installati
Slide 4: Strategic Priorities
Strategic Priorities 1 Drive material conversion from concrete to fiberglass Leverage direct-to-homeowner strategy and digital 2 innovations Enhance and expand strategic partnerships with 3 Latham Grand dealers Execute continuous improvement initiatives and 4 prudently manage costs
Slide 5: Innovating Our Fiberglass Products
Innovating Our Fiberglass Products Drive Fiberglass Conversion Tuscan Enchantment • Expanding fiberglass product portfolio with Tuscan and Enchantment, which cater to popular pool shapes, sizes, and colors • Will begin the roll out of these models in 1H’ 23
Slide 6: Innovating Our Fiberglass Installation Process
Innovating Our Fiberglass Installation Process Drive Fiberglass Conversion • Launching “Backfill Made Easy” for popular Corinthian models in 2023 • New reinforcement build process designed to make the installation on select models easier and faster for dealers
Slide 7: Introducing "Measure by Latham"
Introducing “Measure by Latham” • Latham’s new AI-powered measuring tool will modernize and simplify the measuring experience for dealers for safety covers and in-ground liners • Cutting-edge 3D technology and scanning techniques measure the entire pool perimeter and captures interior renderings of
Slide 8: Enhancing and Expanding Strategic Partnerships with Latham Grand Dealers
Enhancing and Expanding Strategic Partnerships with Latham Grand Dealers Enhance Strategic Partnerships with Latham Grand Dealers ProEssentials • Comprehensive turnkey collection of tools aimed at creating a better buying experience for homeowners and supporting sales growth for our dealers • Consis
Slide 9: Execute Continuous Improvement Initiatives and Prudently Manage Costs
Execute Continuous Improvement Initiatives Continuous and Prudently Manage Costs Improvement & Prudent Cost Management Measure by Latham • On track to realize annualized operating expense savings of ~$12 million in FY’23 o All anticipated actions implemented, including the closure of our Bossier Cit
Slide 10: Q4 and FY 2022 Financial Highlights
Q4 and FY 2022 Financial Highlights Key Drivers Q4 2022 • Return to historical seasonality Net Sales Adjusted EBITDA(1) ($ in millions) ($ in millions) • Volume decline driven by packaged pool inventory destocking in the wholesale distribution channel $139 $108 • Negative fixed cost leverage due to
Slide 11: Disciplined Approach to Capital Allocation
Disciplined Approach to Capital Allocation • Targeted investments in organic growth opportunities that generate significant returns and Reinvesting in the Business value creation • Focus on fiberglass production / delivery equipment and new fiberglass molds Selective Strategic Investments • Strong h
Slide 12: Financial Outlook
Financial Outlook Reflects: • The impact of macroeconomic uncertainty on consumer spending and demand, resulting in anticipated declines in the industry for U.S. new in-ground pool Fiscal 2023 Outlook1 installations in 2023 versus 2022 • Normalization of packaged pool channel inventory in the wholes
Slide 13: Latham: A Compelling Growth Story
Serving a large and attractive market benefitting from material conversion The leading consumer brand in the residential pool market Unique direct-to-homeowner model driving business for our dealer partners Latham: A 1 Broadest portfolio of branded products known for quality, durability, and aesthet
Slide 14: Q&A
Q&A
Slide 15: Appendix
Appendix Latham Group SWIM | Nasdaq Listed
Slide 16: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted EBITDA and Adjusted EBITDA Margin Fiscal Quarter Ended Fiscal Year Ended (in thousands) December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Net loss $ (19,033) $ (5,987) $ (5,694) $ (62,348) Depreciation and amortization 9,341 8,541 38,175 32,230
Slide 17: Non-GAAP Reconciliations
Non-GAAP Reconciliations Net Debt and Net Debt Leverage Ratio (in thousands) As of December 31, 2022 Total debt $ 312,881 Less: Cash (32,626) Net Debt 280,255 LTM Adjusted EBITDA(a) 143,252 Net Debt Leverage Ratio 2.0x (a) LTM Adjusted EBITDA is the sum of the Company’s Adjusted EBITDA for the four