Scotts Miracle-gro Company (the) · NYSE:SMG
Scotts Miracle-gro Company (the) — Q1 2024 Earnings Presentation
19 slides from Scotts Miracle-gro Company (the)'s earnings presentation, Feb 7, 2024
Slide 1: Q1 2024 Quarterly Earnings Report
Q1 2024 Quarterly Earnings Report First quarter ended December 30, 2023 Supplemental Financial Presentation February 7, 2024 Please view this presentation in conjunction with our Q1 2024 earnings release, which is filed on Form 8-K, our related pre-recorded remarks and additional information regardi
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Statements contained in this presentation, which address activities, events and developments that the Company expects or anticipates will or may occur in the future, including, but not limited to, information regarding the future economic performance and financial condition of
Slide 3: Today's speakers
Today’s speakers Jim Hagedorn Chairman, Chief Executive Officer and President Matt Garth EVP, Chief Financial Officer and Chief Administrative Officer 3
Slide 4: Q&A
Q&A A Q&A session will follow the webcast at approximately 9:30 a.m. ET. Jim Hagedorn Nate Baxter Matt Garth Chris Hagedorn Chairman, EVP & COO EVP, CFO & CAO President, Hawthorne CEO & President Division Review the press release for registration details. ● To listen to the Q&A, please remain on the
Slide 5: Financial Update
Financial Update PRESENTED BY Matt Garth EVP, Chief Financial Officer and Chief Administrative Officer 5
Slide 6: Revenue Performance by Operating Segment
1Q 2024 Revenue Performance by Operating Segment U.S. Consumer In line with company expectations ● 17% lower vs. Q1 2023 ● Quarterly shipment phasing returning to pre- pandemic norms ● Q1 Strength reflects extended Fall season in Fertilizers and Soils ● Q1 2024 POS +8% y/y in units and dollars ● Ret
Slide 7: Adjusted Gross Margin Rate to improve 250 bps for the full year
1Q 2024 Adjusted Gross Margin Rate to improve 250 bps for the full year Full Year Expectations ● +250 bps or more vs. FY23 ● Favorable mix more than offsetting low single digit pricing decreases ● Project Springboard distribution and other cost savings benefits ● Avoid prior year one-time excess inv
Slide 8: Total Company Results in line with Management Expectations
1Q 2024 Total Company Results in line with Management Expectations Total Company non-GAAP Results vs. Q1 2023 Net sales $410 million -22% Adjusted Gross Margin Rate 13.7% -640 bps SG&A $115 million -11% Adjusted Equity Income/(Loss) $(12) million vs. $(11)M Interest Expense $43 million Flat Adjusted
Slide 9: Peak Leverage expected in 2Q 2024 within Covenant Maximum
FY 2024 Peak Leverage expected in 2Q 2024 within Covenant Maximum 9 Non-GAAP Measures.
Slide 10: Building Financial Flexibility in Fiscal 2024
Financial Objectives FY 2024 Building Financial Flexibility in Fiscal 2024 $560M Free Cash Flow $575M Balance of $1B over 2 yrs Adjusted EBITDA Reduce Inventories $275M Reduce Debt $350M +250 bps Adjusted Gross Margin Rate Volume Growth SG&A <16% of Sales 10 Non-GAAP Measures.
Slide 11: Q&A
Q&A Jim Hagedorn Nate Baxter Matt Garth Chris Hagedorn Chairman, EVP & COO EVP, CFO & CAO President, Hawthorne CEO & President Division Review the press release for registration details. ● To listen to the Q&A, please remain on the webcast link following our video. ● To ask a question, please pre-re
Slide 12: Appendix
Appendix First quarter ended December 30, 2023 12
Slide 13: Total Company Net Sales
1Q 2024 Total Company Net Sales
Slide 14: Company on track to exceed $1 Billion in FCF over 2 years
FY 2024 Company on track to exceed $1 Billion in FCF over 2 years 14 Non-GAAP Measures.
Slide 15: Our Fiscal 2024 Guidance
FY 2024 Our Fiscal 2024 Guidance ● US Consumer: High Single-Digit increase Net Sales ● Hawthorne: Lower on Brand Restructuring Adjusted Gross Margin Rate ● 250 bps of improvement ● 15% - 16% of net sales SG&A ● Media investments +12% y/y Adjusted Operating Margin Rate ● 10.5% - 11.0% of net sales ●
Slide 16: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Use of Non-GAAP Measures To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses non-GAAP financial measures. The reconciliations of these non-GAAP financial measures to th
Slide 17: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Definitions of Non-GAAP Financial Measures The reconciliations of non-GAAP disclosure items include the following financial measures that are not calculated in accordance with GAAP: ● Adjusted gross margin: Gross margin excluding impairment, restructurin
Slide 18: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 18
Slide 19: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures For the three months ended December 30, 2023, the following items were adjusted, in accordance with the definitions above, to arrive at the non- GAAP financial measures: ● During fiscal 2022, the Company began implementing a series of Company-wide organi
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