Slide 1: Perimeter Solutions SA Q3 2022 Earnings Call
Perimeter Solutions SA Q3 2022 Earnings Call
Slide 2: Disclaimer
Disclaimer Certain statements in this presentation and discussion are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are based on Perimeter Solutions, SA’s (the “Company”) expectations, intentions and projections regarding the Company’s futu
Slide 3: Our Objective
Our Objective Our Objective Goal Strategy Deliver private equity like returns with Own, operate, and grow uniquely high- the liquidity of a public market quality businesses Target Economic Criteria ✓ Recurring and predictable revenue streams ✓ Long-term secular growth tailwinds ✓ Products that accou
Slide 4: Target Economic Criteria
Target Economic Criteria Criteria Commentary • Best in class metrics around long-term customer retention and growth Recurring and Predictable Revenue Streams • NA fire season introduces near-term variability, though dampening with growth in prevention/protection and geographic diversification • ~10%
Slide 5: Value Drivers
Value Drivers Productivity Profitable New and Cost Value Based Business Pricing Capital Allocation Improvements International Fire Safety M&A Opportunity Rigorous value-based Annual cost Other M&A pricing methodology improvements to Share buybacks across customers Prevention & offset inflation Speci
Slide 6: Reliable Long-Term Volume Growth
Reliable Long-Term Volume Growth Retardant Volume Growth = Acres Burned + Retardant Per Acre U.S. Retardant Volume Growth, 2015 - 2021 2015 2021 6
Slide 7: Reliable Long-Term Volume Growth: U.S. Acres Burned
Reliable Long-Term Volume Growth Retardant Volume Growth = Acres Burned + Retardant Per Acre U.S. Acres Burned ex-Alaska, 2015 - 2021 Acres (millions) 6.9M 5.0M 2015 2021 Source: U.S. acres burned data from the National Interagency Fire Center, Alaska acres burned data from the Alaska Department of
Slide 8: Reliable Long-Term Volume Growth: Retardant Per Acre
Reliable Long-Term Volume Growth Retardant Volume Growth = Acres Burned + Retardant Per Acre U.S. Retardant Per Acre, 2015 - 2021 2015 2021 8
Slide 9: Reliable Long-Term Volume Growth: Historical Growth Drivers
Reliable Long-Term Volume Growth Retardant Volume Growth = Acres Burned + Retardant Per Acre Increasing Wildland Urban Interface(1) Historical Growth Drivers Increasing Firefighting Aircraft Capacity(2) (1) According to Proceedings of the National Academy of Sciences of the United States of America,
Slide 10: Long-Term Expectation: Mid-to-High Single Digits
Reliable Long-Term Volume Growth Retardant Volume Growth = Acres Burned + Retardant Per Acre Long-Term Expectation: Mid-to-High Single Digits 10
Slide 11: Annual And Quarterly Variability
Annual And Quarterly Variability Q3 U.S. Acres Burned ex-Alaska YTD U.S. Acres Burned ex-Alaska Acres (millions) Acres (millions) 5.7 4.3 3.8 1.5 Q3 2021 Q3 2022 Sep YTD 2021 Sep YTD 2022 Sources: U.S. acres burned data from the National Interagency Fire Center, Alaska acres burned data from the Ala
Slide 12: Specialty Products
Specialty Products Specialty Products Adjusted EBITDA, $MM Adjusted EBITDA ($MM) >$50.0 $24.0 $23.5 $16.8 2019A 2020A 2021A 2022E 12
Slide 13: Revenue and Adjusted EBITDA
Revenue and Adjusted EBITDA Fire Safety Q3 '22 YTD '22 Revenue Growth -29% -13% Adjusted EBITDA Growth -38% -30% Adjusted EBITDA Margin 49% 39% Specialty Products Q3 '22 YTD '22 Revenue Growth 68% 42% Adjusted EBITDA Growth 512% 135% Adjusted EBITDA Margin 40% 37% Consolidated Q3 '22 YTD '22 Revenue
Slide 14: Q3 and YTD Financial Summary
Q3 and YTD Financial Summary Fire Safety ($000) Q3 '22 Q3 '21 YTD '22 YTD '21 Revenue 121,963 172,445 207,010 237,256 Adjusted EBITDA 60,363 97,854 81,248 116,680 Specialty Products ($000) Q3 '22 Q3 '21 YTD '22 YTD '21 Revenue 38,546 22,969 112,222 79,204 Adjusted EBITDA 15,264 2,496 42,038 17,919 C
Slide 15: Long-Term Assumptions
Long-Term Assumptions Item Assumption Interest Expense ~$40M annually Tax-deductible D&A ~$10M annually Tax Rate ~26%(1) Capital Expenditures ~$10M annually Change In Working Capital ~10-20% of the Δ in revenue Current Basic Shares Outstanding ~162M(2) (1) Excluding impacts from purchase accounting,
Slide 16: Diluted Share Count
Diluted Share Count QTD Category Shares (M) Dilutive impact of performance- based stock options and Wtd. Avg. Basic Shares Outstanding 162.6 warrants Dilutive impact of shares 1 Performance-Based Options and Warrants 0.0 issuable under the Fixed Annual Advisory Amount between Q1 2023 and Q1 2028 2 (
Slide 17: Supplementary Slides
Supplementary Slides
Slide 18: Long-Term Growth Track Record
Long-Term Growth Track Record ($m) Adj. EBITDA Revenue Revenue Adj. EBITDA Adj.Adj. EBITDA Margin EBITDA Margin 600 2010A – 2021A CAGRs 45% 40% Adj. EBITDA: 500 Revenue: 11% 17% (1) 35% 400 30% 25% 300 20% 200 15% 10% 100 5% 0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Capex % NA
Slide 19: Positioned for Continued Market Leadership
Positioned for Continued Market Leadership Product • Extensive performance, safety, and environmental testing driven by stringent regulatory and qualification requirements Qualification of the U.S. Forest Service • Perimeter provides a comprehensive, integrated product and service offering • Perimet
Slide 20: Long-Term Fire Safety Volume Growth
Long-Term Fire Safety Volume Growth Domestic wildfire suppression spend is growing Federal Fire Suppression Spend California Fire Suppression Spend 5,000 80,000 2,000 4,500 1985 – 2021 1985 – 2021 70,000 1,800 CAGR: 8% CAGR: 10% 4,000 1,600 60,000 Total Fire Suppression Spend ($m) Total Fire Suppres
Slide 21: Long-Term Fire Safety Volume Growth
Long-Term Fire Safety Volume Growth Wildfire severity and suppression spend are increasing globally Australia Overview Chile Overview ▪ Australia’s annual federal spend on aerial firefighting has steadily ▪ The number of forest fires in Chile has increased over the last two increased over the past 1
Slide 22: Critical Service Representing a Fraction of Spend
Critical Service Representing a Fraction of Spend Retardant is the active ingredient, and a critical component, in wildfire fighting, but represents ~3% of suppression costs Fire Retardant as a % of Federal Suppression Spend Fire Retardant as a % of California Suppression Spend Retardant Retardant S
Slide 23: Operating Principles
Operating Principles 1 Provide customers with high-value products and exceptional service 2 Maintain a decentralized and autonomous organization structure 3 Implement a compensation system that closely aligns management with shareholders 4 Follow our value-based operating methodology based on our th
Slide 24: Incentive Alignment
Incentive Alignment • Approximately 10.2M stock options issued to management, employees, and directors • Vest ratably over five years based on intrinsic share price growth • Founder Advisory Agreement pertaining to the EverArc Founders • Fixed Annual Advisory Amount equal to 1.5% of 157,137,410 Ordi
Slide 25: Appendix
Solutions That Save.
Slide 26: Non-GAAP Financial Metrics (Consolidated)
Non-GAAP Financial Metrics (Consolidated) Adjusted EBITDA ($000) Q3 '22 Q3 '21 YTD '22 YTD '21 Income before income taxes $ 113,227 $ 70,646 $ 147,437 $ 42,783 Depreciation and Amortization 16,450 15,212 49,536 45,593 Interest and financing costs 9,944 8,065 32,582 23,951 Founders' advisory fees - r
Slide 27: Thank You!
Thank You! NOTICE: Although the information and recommendations set forth herein (hereinafter “Information”) are presented in good faith and believed to be correct as of the date hereof, Perimeter Solutions/Solberg/Auxquimia (the “Company”) makes no representations or warranties as to the completene