Csw Industrials, Inc. · NYSE:CSW
Csw Industrials — Q1 FY2022 Earnings Presentation
38 slides from Csw Industrials's earnings presentation, August 2021
Slide 1: Investor Presentation: Fiscal 1st Quarter 2022 Results
AUGUST 2021 Fiscal 1 st Quarter Investor Presentation 2022 Results
Slide 2: Forward Looking Statement and Non-GAAP Financial Information
Forward Looking Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to, among other things, the business, financial condition and results of operations of CSW Industrials, Inc. (“CSWI” or the “Company”).
Slide 3: Index
Index 4 Overview and Investment Thesis 7 Fiscal 1 st Quarter 2022 Results 13 Driving Long-Term Shareholder Value 20 Corporate Sustainability Update 23 Business Segment Overview 34 Appendix
Slide 4: CSW Industrials (Nasdaq: CSWI) Key Highlights
CSW Industrials (Nasdaq: CSWI) Key Highlights 2015 Publicly Listed on Nasdaq2 ~$1.9B A growth-oriented, diversified industrial company with a strategic focus on providing Market Capitalization3 niche, value-added products in the end markets we serve. Three Segments (Segment percentages reflect TTM1
Slide 5: Compelling Investment Thesis
Compelling Investment Thesis Consistently demonstrating growth in excess of end markets served Sustained multi-year • Total revenue CAGR of 9.4% from FY16 through FY211 revenue growth • Organic revenue CAGR of 5.8% from FY16 through FY211 Robust margin profile provided by niche products, application
Slide 6: Our Guiding Objectives
Our Guiding Objectives At CSWI, how we succeed matters, and accordingly we will: Position CSWI for Treat Our Serve Our Manage Our Supply Sustainable, Long-Term Employees Well Customers Well Chains Effectively Growth and Profitability • Meaningful, continued safety • Emphasize consistent • Acknowledg
Slide 7: Fiscal 1st Quarter 2022 Summary of Financial Results
Fiscal 1st Quarter 2022 Summary of Financial Results
Slide 8: Strategic New Segments Effective April 1, 2021
Strategic New Segments Effective April 1, 2021 Contractor Solutions Engineered Building Solutions Specialized Reliability Solutions • $305.9MM TTM Revenue, • $99.2MM TTM Revenue, • $84.8MM TTM Revenue, $103.7MM adjusted EBITDA, and $15.0MM adjusted EBITDA, and $9.0MM adjusted EBITDA, and 33.9% adjus
Slide 9: Consolidated Results: 1Q22 Summary
Consolidated Results: 1Q22 Summary Consolidated Financial Highlights (1Q22 vs 1Q21): Summary Quarterly Consolidated Results1 • Revenue of $161.3MM, a 77.3% increase ($ in millions) o $33.5MM inorganic contribution from TRUaire acquisition o $36.8M, or 40.5% organic growth, with growth in all segment
Slide 10: Contractor Solutions: 1Q22 Segment Summary
Contractor Solutions: 1Q22 Segment Summary Summary Quarterly Segment Financial Highlights (1Q22 vs 1Q21): Segment Results ($ in millions) • Segment Revenue increased 121.0% (53.9% $110.2 35.8% organic) to $110.2MM, primarily driven by: Margin 38.3% o Inorganic growth from TRUaire of $33.5MM 34.7% $5
Slide 11: Engineered Building Solutions: 1Q22 Segment Summary
Engineered Building Solutions: 1Q22 Segment Summary Segment Financial Highlights (1Q22 vs 1Q21): Summary Quarterly Segment Results ($ in millions) • Segment Revenue increased 15.8% (all organic) to $25.7MM, primarily driven by: o Enhanced marketing efforts to promote existing and newly developed pro
Slide 12: Specialized Reliability Solutions: 1Q22 Segment Summary
Specialized Reliability Solutions: 1Q22 Segment Summary Summary Quarterly Segment Financial Highlights (1Q22 vs 1Q21): Segment Results ($ in millions) • Segment Revenue increased 33.9% (all organic), to $25.4MM, primarily driven by: o Increased sales volumes into general industrial and energy end ma
Slide 13: Driving Long-Term Shareholder Value
Driving Long-Term Shareholder Value
Slide 14: Seeking Sustainable Growth in Shareholder Value
Seeking Sustainable Growth in Shareholder Value Our demonstrated track record of growth and enhancing long-term shareholder value. Maintain Our Strong Balance Sheet • ~$1.9B market cap, as of 7/30/21, compared to ~$500MM in 2015 public debut Allocate Capital Efficiently • $489.5MM TTM revenue, versu
Slide 15: Maintaining Our Strong Balance Sheet
Maintaining Our Strong Balance Sheet CSWI is committed to maintaining a strong balance sheet, with ample liquidity through cash and available credit to maximize growth opportunities, both organically and inorganically. Liquidity Position as of 6/30/21 Strong liquidity position to support organic & i
Slide 16: Allocating Capital Efficiently
Allocating Capital Efficiently Capital allocation decisions will continue to be prioritized on a risk-adjusted TTM Capital Allocation1 returns basis, with the goal of driving long-term shareholder value. ($ in millions) $302.5MM Organic Growth Inorganic Growth • Invest in enhancing innovative, value
Slide 17: Investing in Innovative Products
Investing in Innovative Products Our product innovation strategy is focused on commercially attractive products and solutions, while maintaining a flexible manufacturing strategy. Key Innovation Attributes Include: Serving Niche Applications Providing Incremental Value-Selling Through Resulting in L
Slide 18: Strategic, Disciplined Approach to M&A
Strategic, Disciplined Approach to M&A As a diversified industrial growth company, our goal is to increase free cash flow through sustainable organic growth, accretive inorganic growth, and operational efficiencies. CSW Industrials Target Criteria: • Seek long-term growth well in excess • Expand in
Slide 19: Accessing Distribution Channels to Accelerate Growth
Accessing Distribution Channels to Accelerate Growth We have focused on growing our distribution network in recent years, enhancing revenue growth from new product introductions and acquisitions. Without CSWI: Limited Distribution With CSWI: Broad Distribution <40 >200 Distributor Groups Distributor
Slide 20: Corporate Sustainability Update
Corporate Sustainability Update
Slide 21: Corporate Culture and Values
Corporate Culture and Values The Goal of Our Corporate Culture is to Maximize Performance CSWI’s corporate culture will shape and guide our Company by helping each team member understand how to make his/her contribution to the Company we serve. Our culture manifests the observed behaviors, norms, an
Slide 22: Corporate Culture and Values: Diversity, Inclusion, and Respect
Corporate Culture and Values Our Commitment to Diversity, Inclusion, and Respect: We seek to create, nurture, and sustain an inclusive and diverse environment that attracts and retains the highest caliber team members, leveraging their skills and expertise to serve our customers. We are dedicated to
Slide 23: Business Segment Overview
Business Segment Overview
Slide 24: Contractor Solutions Segment – Overview
Contractor Solutions Segment – Overview Summary: End Markets Served: • Highly diversified product portfolio • Future growth focus on new product providing industry leading products introductions through organic HVAC/R in both direct-to-customer and innovation and inorganic additions distributor mode
Slide 25: Contractor Solutions Segment – Overview
Contractor Solutions Segment – Overview Strategic Growth that Outpaces End Markets: • Continue to develop and market innovative products providing low cost and high value, while supporting additional revenue growth for distributors and efficiencies for professional contractors • Acquire, develop, an
Slide 26: Contractor Solutions: Products
Contractor Solutions: Products Investor Presentation 26 August 2021
Slide 27: Contractor Solutions: Mini-Split Products
Contractor Solutions: Mini-Split Products Investor Presentation 27 August 2021
Slide 28: Engineered Building Solutions Segment – Overview
Engineered Building Solutions Segment – Overview Summary: End Markets Served: • Decades of experience creating • Multiple manufacturing locations products that protect lives provides efficiency to meet the needs Smoke & Fire of general contractors and architects Protection • Endless use cases for co
Slide 29: Engineered Building Solutions Segment – Overview
Engineered Building Solutions Segment – Overview Where Form Meets Function: • Market leader in providing unique solutions to architects and contractors that meet code requirements, while adding functionality, performance, and aesthetically-pleasing designs • Whether for new construction or renovatio
Slide 30: Engineered Building Solutions: Products
Engineered Building Solutions: Products Investor Presentation 30 August 2021
Slide 31: Specialized Reliability Solutions Segment – Overview
Specialized Reliability Solutions Segment – Overview Summary: End Markets Served: • Our product portfolio allows us to • Focus on adding value by innovating effectively compete and capture new and existing products to Rail/Transport enhanced margins relative to larger accelerate organic growth Speci
Slide 32: Specialized Reliability Solutions Segment – Overview
Specialized Reliability Solutions Segment – Overview Mission Critical Meets Mission Accomplished: • Established reputation for solving equipment maintenance challenges and increasing the reliability, performance, and lifespan of industrial assets utilized in the most demanding environments and extre
Slide 33: Specialized Reliability Solutions: Products
Specialized Reliability Solutions: Products Investor Presentation 33 August 2021
Slide 34: Appendix
Appendix
Slide 35: CSWI Executive Team
CSWI Executive Team Veteran leadership with broad industry experience, dedicated to enhancing shareholder value. Joe Armes James Perry Donal Sullivan Luke Alverson Chairman, CEO Executive VP Executive VP Senior VP, General & President & CFO & General Manager Counsel & Secretary Joe has served as the
Slide 36: Reconciliation of Fiscal First Quarter Segment Operating Income to Adjusted Segment EBITDA
Reconciliation of Fiscal First Quarter Segment Operating Income to Adjusted Segment Operating Income and to Adjusted Segment EBITDA (Unaudited) (Unaudited) (Unaudited) Three Months Ended June 30, 2021 Three Months Ended June 30, 2020 Three Months Ended June 30, 2019 Engineered Specialized Consolidat
Slide 37: Reconciliation of TTM Segment Operating Income to Adjusted Segment EBITDA
Reconciliation of TTM Segment Operating Income to Adjusted Segment Operating Income and to Adjusted Segment EBITDA (Unaudited) Trailing Twelve Months Ended June 30, 2021 Engineered Specialize Consolidated Contractor Building Reliability Corporate Continuing (Amounts in thousands) Solutions Solutions
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