H. B. Fuller Company · NYSE:FUL
H. B. Fuller — Q2 2024 Earnings Presentation
28 slides from H. B. Fuller's earnings presentation, Jun 27, 2024
Slide 1: Second Quarter 2024 Conference Call
Title Slide Second Quarter 2024 Conference Call June 27, 2024 ® 2024 H.B. Fuller
Slide 2: Disclosure
Disclosure Safe Harbor Statement Certain matters discussed today may be considered forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such s
Slide 3: Second Quarter Highlights
Second Quarter Highlights Adjusted EBITDA $157M Adjusted EBITDA Margin 17.1% Adjusted EPS $1.12 Up 10% YOY Up 120 bps YOY Up 20% YOY Strong second quarter financial performance reflects the team’s steadfast commitment to execution On track to deliver adjusted EBITDA margin greater than 20 percent in
Slide 4: Global Business Unit Update
Global Business Unit Update Engineering Health, Hygiene, and Construction Adhesives Consumable Adhesives Adhesives • Organic revenue up 2.5% YOY • Organic revenue improved • Organic sales increased 7% sequentially on a return to YOY on strong demand in • Strength in electronics, automotive, positive
Slide 5: Regional Perspective
Regional Perspective AMERICAS • Organic revenue flat YOY • On a combined basis, EA and CA achieved organic revenue growth of more than 6% YOY driven by strong growth in electronics, aerospace, and roofing • Hygiene, while slightly improved, continued to negatively impact organic sales development EI
Slide 6: ND Industries
ND Industries Leading provider of specialty adhesives and fastener locking solutions Expands our market presence into fastener locking solutions Products under the well-known Vibra-Tite® brand for industrial use will be added to our existing portfolio ND’s full-year 2024 sales are expected to be ~$8
Slide 7: Q2 Financial Summary
Q2 Financial Summary Continued Margin Expansion and Adjusted EBITDA Growth • Net revenue was up 2.1% YOY • Organic revenue was down 0.1% YOY; volume was up 3.3% YOY • Adjusted gross profit margin was 31.1%, up 210 basis points YOY • Adjusted SG&A was up 9% YOY due to acquisitions, wage inflation, an
Slide 8: FY 2024 Financial Guidance Update
FY 2024 Financial Guidance Update Revenue • Net revenue is now expected to be up 2% to 4% YOY with organic revenue flat to up 2% YOY Adjusted EBITDA • Adjusted EBITDA is now expected to be in the range of $620M to $640M, increasing 7% to 10% YOY Net Interest Expense • Net interest expense is now exp
Slide 9: 2024 Customer Innovation Awards
2024 Customer Innovation Awards Recognizing customers across industries for world-changing innovations using adhesive technology Congratulations to: ® 2024 H.B. Fuller
Slide 10: 2024 ASC Innovation Award
2024 ASC Innovation Award Thermoplastic Encapsulant Platform for Photovoltaic Modules Enables the creation of solar panels that generate power at a lower cost per watt than traditional technology ® 2024 H.B. Fuller
Slide 11: Summary
Summary • Pleased with first half financial results and continued incremental improvement we are driving throughout the business • One focus: creating customized value-added adhesives solutions for our customers • Set to deliver another year of improved profitability and ROIC, strong cash flow • On
Slide 12: Q&A Session
Q&A Session
Slide 13: Appendix: Portfolio Recasting
Appendix: Portfolio Recasting Growth Category Leverage Category 16 Market Segments 16 Market Segments Overview Overview • 16 of our market segments, across all 3 GBU’s • Consists of 16 market segments, across all 3 GBU’s • Focused on quickly growing high margin segments • Focused on maximizing opera
Slide 14: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION In thousands, except per share amounts (unaudited) Three Months Three Months Ended Percent of Ended Percent of June 1, 2024 Net Revenue June 3, 2023 Net Revenue Net revenue $ 917,107 100.0 % $ 898,23
Slide 15: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION In thousands, except per share amounts (unaudited) Six Months Six Months Ended Percent of Ended Percent of June 1, 2024 Net Revenue June 3, 2023 Net Revenue Net revenue $ 1,727,525 100.0 % $ 1,707,42
Slide 16: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands, except per share amounts (unaudited) Three Months Ended Six Months Ended June 1, 2024 June 3, 2023 June 1, 2024 June 3, 2023 Net income attributable to H.B. Fuller $ 51,264 $ 40,401 $ 82,255 $
Slide 17: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES SEGMENT FINANCIAL INFORMATION In thousands (unaudited) Three Months Ended Six Months Ended June 1, June 3, June 1, June 3, 2024 2023 2024 2023 Net Revenue: Hygiene, Health and Consumable Adhesives $ 393,111 $ 404,486 $ 760,804 $ 788,0
Slide 18: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands, except per share amounts (unaudited) Three Months Ended Six Months Ended June 1, June 3, June 1, June 3, 2024 2023 2024 2023 Income before income taxes and income from equity method investment
Slide 19: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Three Months Ended Six Months Ended June 1, June 3, June 1, June 3, 2024 2023 2024 2023 Net revenue $ 917,107 $ 898,239 $ 1,727,525 $ 1,707,421 Gross profit $ 282,052 $ 256,775 $ 52
Slide 20: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Hygiene, Health Three Months Ended and Consumable Engineering Construction Corporate H.B. Fuller June 1, 2024 Adhesives Adhesives Adhesives Total Unallocated Consolidated Net income
Slide 21: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Hygiene, Health Six Months Ended and Consumable Engineering Construction Corporate H.B. Fuller June 1, 2024 Adhesives Adhesives Adhesives Total Unallocated Consolidated Net income a
Slide 22: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Hygiene, Health Three Months Ended and Consumable Engineering Construction Corporate H.B. Fuller June 3, 2023 Adhesives Adhesives Adhesives Total Unallocated Consolidated Net income
Slide 23: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Hygiene, Health Six Months Ended and Consumable Engineering Construction Corporate H.B. Fuller June 3, 2023 Adhesives Adhesives Adhesives Total Unallocated Consolidated Net income a
Slide 24: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES SEGMENT FINANCIAL INFORMATION NET REVENUE GROWTH (DECLINE) (unaudited) Three Months Six Months Revenue growth versus 2023 Ended Ended June 1, 2024 June 1, 2024 Price (3.4 )% (3.4 )% Volume 3.3 % 1.4 % Organic Growth13 (0.1 )% (2.0 )%
Slide 25: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) Three Months Ended Trailing Twelve Year Months16 Ended September 2, December 2, March 2, Ended June December 2, 2023 2023 2024 June 1, 2024 1, 2024 2023 Net income attributable to H
Slide 26: Regulation G Reconciliations
Regulation G Reconciliations H.B. FULLER COMPANY AND SUBSIDIARIES REGULATION G RECONCILIATION In thousands (unaudited) December 2, June 1, 2024 2023 June 3, 2023 Total debt $ 2,024,916 $ 1,838,431 $ 1,882,343 Less: Cash and cash equivalents 114,823 179,453 103,183 Net debt17 $ 1,910,093 $ 1,658,978
Slide 27: Regulation G Reconciliations
Regulation G Reconciliations 1 Acquisition project costs include costs related to evaluating, acquiring and integrating business acquisitions. Acquisition project costs include $1,385 and $2,105 in transaction costs (primarily consulting and professional fees, representations and warranties insuranc
Slide 28: Regulation G Reconciliations
Regulation G Reconciliations 10 Adjusted income taxes and adjusted effective income tax rate are non-GAAP financial measures. Adjusted income taxes is defined as income taxes before the specific adjustments shown above. Adjusted effective income tax rate is defined as income taxes divided by adjuste