Siteone Landscape Supply, Inc. · NYSE:SITE
Siteone Landscape Supply — Q2 2018 Earnings Presentation
21 slides from Siteone Landscape Supply's earnings presentation, 2018
Slide 1: Second Quarter 2018 Earnings
Second Quarter 2018 Earnings
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to our 2018 Adjusted EBITDA outlook. S
Slide 3: Conference call agenda
Conference call agenda Introduction Pascal Convers, EVP S&D and IR Business Update Doug Black, Chairman and CEO Financial Update John Guthrie, CFO Development Update Pascal Convers, EVP S&D and IR Closing & Outlook Doug Black, Chairman and CEO Q&A 3
Slide 4: Company and industry overview
Company and industry overview ■ Largest and only national wholesale distributor of landscape supplies ■ $18 billion highly fragmented market ■ More than four times the size of next competitor and only ~10% market share(1) ■ Serving residential and commercial landscape professionals Distribution Cent
Slide 5: SiteOne is poised for long-term growth and margin enhancement
SiteOne is poised for long-term growth and margin enhancement Current strategy Leverage strengths of both large and local company ■ Fully exploit our scale, resources and capabilities ■ Execute local market growth strategies ■ Deliver superior value to our customers and suppliers ■ Close and integ
Slide 6: Accelerating performance and growth led by recent transformation
Accelerating performance and growth led by recent transformation Net Sales Adjusted EBITDA (in Millions) (in Millions) 1,862 157 ’14-’17 Growth ’14-’17 Growth 1,648 134 1,452 32.0% Sales +58% 8.4% Adj. EBITDA +113% 107 1,177 31.3% GM% +560 bps 74 8.1% Adj. EBITDA % +210 bps 29.6% 7.3% 26.4% 6.3% FY
Slide 7: Significant room to grow across product lines
Significant room to grow across product lines # of markets1 Missing either Missing both Full Product No Hardscapes or Hardscapes Line Offering Presence Nursery and Nursery SiteOne offers all ~50 product lines in only ~20% of our target markets today… ~80 ~50 ~45 (1) Target markets are represented by
Slide 8: Second Quarter 2018 highlights and recent developments
Second Quarter 2018 highlights and recent developments Second Quarter 2018 highlights: Net sales increased by 13% to $687.8 million Organic Daily Sales increased by 5% Gross profit increased by 14% to $229.9 million; gross margin expanded 10 bps to 33.4% Net income increased by 43% to $63.1
Slide 9: Review of Second Quarter 2018 financial results
Review of Second Quarter 2018 financial results Summary financials Financial highlights ($ in millions) ■ Net sales increased 13% YoY to $687.8 million – Organic Daily Sales increased 5% Net sales 608.6 687.8 – Acquisitions contributed $48 million, or 8% to growth Q2 ’17 Q2’18 ■ Gross profit increas
Slide 10: Review of Second Quarter 2018 balance sheet & cash flow highlights
Review of Second Quarter 2018 balance sheet & cash flow highlights Second Quarter 2018 Balance sheet & cash flow highlights ($ in millions) ■ Working Capital increased 26% YoY to $516.6 million – Higher inventory and receivables attributable to acquisitions, strong organic growth and the rollout of
Slide 11: Proven track record of successful acquisitions
Proven track record of successful acquisitions 2014 2015 2016 2017 2018YTD Total Eljay Shemin Hydro-Scape Aspen Valley Pete Rose Diamond Head AMC Blue Max Stone Forest Atlantic Irrigation Stockyard Green Bissett Angelo's Village Nurseries Resource BISCO Glen Allen
Slide 12: M&A continues to add significant value
M&A continues to add significant value Terrazzo & Stone Landscaper’s Choice Naples SiteOne existing SiteOne existing Terrazzo & Stone Landscaper’s Choice Closed in April 2018 Closed in May 2018 Leading hardscapes platform in Seattle, WA Leading nursery position in Naples, FL Cross-sell opp
Slide 13: M&A continues to add significant value
M&A continues to add significant value Auto-Rain All American Stone College Station Auto-Rain SiteOne existing All American Stone Closed in June 2018 Closed in June 2018 Leading irrigation position and geographic Leading hardscapes & landscape supplies position expansion into the Spokane Val
Slide 14: M&A continues to add significant value
M&A continues to add significant value Landscape Express Kirkwood SiteOne existing SiteOne existing Landscape Express Kirkwood Closed in July 2018 Closed in July 2018 Leading hardscapes and landscape supplies platform Leading hardscapes and nursery platform Cross-sell opportunities Cross
Slide 15: M&A continues to add significant value
M&A continues to add significant value Stone Center CentralPro SiteOne existing SiteOne existing Stone Center CentralPro Closed in July 2018 Closed in July 2018 #1 Hardscapes position in Southern Maryland & #1 Irrigation position in the Orlando, Tampa and Northern Virginia SE Florida markets
Slide 16: Robust pipeline provides significant growth opportunity
Robust pipeline provides significant growth opportunity SiteOne is the leading industry consolidator 10% Significant sourcing advantage with 70+ associates scouting 90% Our pipeline is deep and expanding ~$16bn(1) opportunity M&A team in place to execute larger pipeline Acquisitions are hi
Slide 17: 2018 outlook
2018 outlook Underlying market trends remain positive Market share gains expected to continue Continued EBITDA margin expansion M&A activity gaining momentum from a robust pipeline 2018 Adjusted EBITDA expectation of $180 million to $192 million 17
Slide 18: Investment highlights
Investment highlights Uniquely Clear market leader attractive industry Compelling and Proven management sustainable team growth strategy Operational and Value-creating commercial acquisitions excellence 18
Slide 19: Appendix
Appendix Non-GAAP Reconciliations
Slide 20: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation 2018 2017 2016 ($ in millions) Q2 ‘18 Q1 ‘18 Q4 ‘17 Q3 ‘17 Q2 ‘17 Q1 ‘17 Q4 ‘16 Q3 ‘16 Net income (loss) 63.1 (17.0) 4.0 16.9 44.2 (10.5) (5.6) 14.9 Income tax expense (benefit) 14.7 (10.2) (11.4) 10.7 26.3 (7.6) (4.1) 10.7 Interest expense, ne
Slide 21: Non-GAAP reconciliations
Non-GAAP reconciliations Organic Daily Sales Reconciliation 2018 2017 ($ in millions) Q2 Q1 Q2 Q1 Net Sales $687.8 $371.4 $608.6 $335.0 Organic Sales $609.1 $337.9 $578.3 $329.4 A Acquisition contribution $78.7 $33.5 $30.3 $5.6 Selling Days (#) 64 64 64 64 Organic Daily Sales $9.5 $5.3 $9.0 $5.1 A R
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