Slide 1: AZZ Inc. Q3 FY2023 Earnings Release Presentation
AZZ Inc. Q3 FY2023 Earnings Release Presentation January 10, 2023
Slide 2: Disclaimers
Q3 FY2023 EARNINGS PRESENTATION Disclaimers Cautionary Statements Regarding Forward Looking Statements — Certain statements herein about our expectations of future events or results constitute forward- looking statements for purposes of the safe harbor provisions of The Private Securities Litigation
Slide 3: Q3 FY2023 Company Highlights
Q3 FY2023 EARNINGS PRESENTATION Q3 FY2023 Company Highlights Q3 Fiscal 2023 Sales $373 million(1) Metal Coatings Precoat Metals Segment Segment $158.3M $215.0M +17.2% vs. Q3 FY2022 +14.8% vs. Comparable Q3 FY2022 Key Accomplishments in the Quarter ▪ Completed the divestiture of a 60% majority stake
Slide 4: Q3 Fiscal Year 2023 Summary – AZZ Consolidated Results
Q3 FY2023 EARNINGS PRESENTATION Q3 Fiscal Year 2023 Summary – AZZ Consolidated Results In $millions, except percentages and per share amounts Sales EBITDA Net Income Diluted EPS +176% (34%) / (a) +79% (214%) / (a) +4% (214%) / (a) +4% $373.3 $21.1 $22.0 $0.85 $0.88 $71.2 $39.8 $26.2 $135.1 -$0.97 -$
Slide 5: Segment Results – Metal Coatings Segment
Q3 FY2023 EARNINGS PRESENTATION Q3 FY2023 Segment Results – Metal Coatings Segment In millions $ except percentages Sales Operating Income EBITDA(1) +17% +1% +3% Key Statistics $158.3 FY2022 Sales $135.1 $135.1 $41.9 $40.7 Organic $17.3 $33.1 $33.5 Acquisitions $5.9 24.5% 21.2% 30.2% 26.5% FY2023 Sa
Slide 6: Segment Results – Precoat Metals
Q3 FY2023 EARNINGS PRESENTATION Q3 FY2023 Segment Results – Precoat Metals (acquisition date May 13, 2022) In millions $ except percentages Sales Adjusted Operating EBITDA(2) Key Statistics Income(1) FY2022 Sales $ 0.0 $215.0 Organic $0.0 $29.0 $34.4 Acquisitions $215.0 13.5% 16.0% FY2023 Sales $215
Slide 7: YTD Fiscal Year 2023 Summary – AZZ Consolidated Results
Q3 FY2023 EARNINGS PRESENTATION YTD Fiscal Year 2023 Summary – AZZ Consolidated Results In $millions, except percentages and per share amounts Sales EBITDA Net Income Diluted EPS +149% (47%) / (a) +100% (194%) / (a) +56% (195%) / (a) +56% $3.89 $987.1 $238.5 $97.2 $2.48 $62.4 $119.2 $395.7 $63.3 $(5
Slide 8: Q3 FY2023 Consolidated Results
Q3 FY2023 EARNINGS PRESENTATION Q3 FY2023 Consolidated Results In millions, except for EPS and percentages % Change vs. Q3 FY 2023 Q3 FY 2022 Prior Year Sales $373.3 $135.1 +176.3% Gross Profit $73.1 $37.6 +94.4% Gross Margin 19.6% 27.8% (820)bps Operating Profit $45.4 $21.3 +113.2% Operating Margin
Slide 9: YTD FY2023 AZZ Cash Flow Highlights – Continuing Operations
Q3 FY2023 EARNINGS PRESENTATION YTD FY2023 AZZ Cash Flow Highlights – Continuing Operations In millions, except for percentages YTD FY 2023 YTD FY 2022 Net Cash Provided by Operating Activities $68.6 $45.9 Less: Capital Expenditures(1) $(35.1) $(15.8) Free Cash Flow(2) $33.5 $30.1 Net Income from co
Slide 10: Capital Allocation
Q3 FY2023 EARNINGS PRESENTATION Capital Allocation In millions • Safety, Health and Environmental Q3 2023 Capital Deployment Capital • Productivity and capacity initiatives • General maintenance and sustainability Expenditures Growth $230.3 • Focused on Precoat Metals integration • Active pipeline o
Slide 11: Q3 Fiscal Year 2023 – Debt Compliance / Net Leverage
Q3 FY2023 EARNINGS PRESENTATION Q3 Fiscal Year 2023 – Debt Compliance / Net Leverage Max Leverage 6.25x 6.0x • No debt maturities until 2027 4.5x • Strong cash flow generation supports 4.2x 4.3x deleveraging priority 3.6x 3.4x • Robust cash flow with expected adjusted 3.0x 3.0x Long-Term EBITDA of $
Slide 12: Key Indicators And Financial Guidance
Key Indicators And Financial Guidance 12
Slide 13: Key Indicators
Q3 FY2023 EARNINGS PRESENTATION Key Indicators ✓ Metal Coatings Segment ▪ Market activity remains normal as we progress through the seasonally slower winter months ▪ Fabrication activity remains solid for Q4 ▪ Zinc costs in our kettles have peaked in most markets ✓ Precoat Metals Segment ▪ Business
Slide 14: Prior Guidance - FY 2023 Revised Guidance – FY 2023
Q3 FY2023 EARNINGS PRESENTATION Prior Guidance - FY 2023 Revised Guidance – FY 2023 $1,275 - $1,325mm No change Sales Sales $1,455 - $1,505mm(1) Pro Forma Sales $285 - $305mm No change Adjusted EBITDA Adjusted EBITDA $300 - $320mm(1) Pro Forma EBITDA $3.80 - $4.00 Raising Guidance to Adjusted EPS $4
Slide 15: Investment Thesis
Q3 FY2023 EARNINGS PRESENTATION North America’s leading independent hot-dip galvanizing and coil coating company with #1 positions in both markets Irreplaceable footprint provides cost advantages and enables service capabilities to customers Investment Diversified and resilient end markets with secu
Slide 16: Q&A
Q&A
Slide 17: Appendix
Appendix
Slide 18: Q3-2023 Earnings Per Share (EPS) Walk
Q3 FY2023 EARNINGS PRESENTATION Q3-2023 Earnings Per Share (EPS) Walk(1) $1.50 $0.32 $0.27 $1.00 $0.88 $1.80 $0.50 $0.00 ($0.50) ($1.00) ($0.97) ($1.50) (1) Earnings per share amounts included in the chart above may not sum due to rounding differences. 18
Slide 19: Reg “G” Tables
Reg “G” Tables
Slide 20: Consolidated Non-GAAP Disclosure
Q3 FY2023 EARNINGS PRESENTATION Consolidated Non-GAAP Disclosure Three Months Ended November 30, Nine Months Ended November 30, 2022 2021 2022 2021 Per Per Per Per Diluted Diluted Diluted Diluted Amount Share(1) Amount Share(1) Amount Share(1) Amount Share(1) Net income (loss) available to common sh
Slide 21: Non-GAAP Disclosure of Consolidated EBITDA
Q3 FY2023 EARNINGS PRESENTATION Non-GAAP Disclosure of Consolidated EBITDA Three Months Ended Nine Months Ended November 30, November 30, 2022 2021 2022 2021 Net income (loss) $ (20,542) $ 21,085 $ (54,035) $ 62,400 Interest Expense(1) 26,126 1,630 61,747 5,081 Income Tax (Benefit) Expense(1) (2,380
Slide 22: Non-GAAP Segment Disclosure from Continuing Operations (Metal Coatings and Precoat Metals)
Q3 FY2023 EARNINGS PRESENTATION Non-GAAP Segment Disclosure from Continuing Operations (Metal Coatings and Precoat Metals) Three Months Ended Nine Months Ended November 30, November 30, 2022 2021 2022 2021 Metal Coatings Net income (loss) $ 32,972 $ 33,191 $ 121,832 $ 97,169 Interest Expense 9 4 21