Tredegar Corporation · NYSE:TG
Tredegar — Q2 2023 Earnings Presentation
33 slides from Tredegar's earnings presentation, Aug 29, 2023
Slide 1: 2023 Second Quarter Financial Results
2023 Second Quarter Financial Results August 29, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements contained in this presentation are forward-looking statements. Pursuant to federal securities regulations, we have set forth cautionary statements relating to those forward-looking statements in our Annual Report on Form 10-K for the year ended December
Slide 3: 2023 Second Quarter and First Six Months Results
Tredegar Corporation 2023 Second Quarter and First Six Months Results (in millions, except per share data) 2Q 2023 2Q 2022 YTD 2023 YTD 2022 Net Sales1 $171.0 $263.3 $356.0 $491.8 Net Income from Ongoing Operations2 $(2.0) $17.2 $0.5 $34.1 Diluted EPS from Ongoing Operations2 $(0.06) $0.51 $0.01 $1.
Slide 4: Aluminum Extrusions (Bonnell Aluminum)
Aluminum Extrusions (Bonnell Aluminum) 2023 Second Quarter and First Six Months Results Second Quarter Performance First Six Months Performance (in millions) 2Q 23 2Q 22 (in millions) 2023 2022 Volume (lbs.) 35.5 49.0 (28)% Volume (lbs.) 73.1 92.0 (21)% Net Sales1 $121.8 $190.3 (36)% Net Sales1 $255
Slide 5: Aluminum Extrusions: Open Orders, Net Bookings and ABI Index
Aluminum Extrusions (Bonnell Aluminum) Open Orders, Net Bookings and ABI Index ◦ Open orders at the end of the second quarter of 2023 were 20 million pounds (versus 27 million pounds at the end of the first quarter of 2023), which is below the quarterly range of 21 to 27 million pounds in 2019, befo
Slide 6: PE Films
PE Films (Surface Protection, Polyethylene Overwrap Films & Films for Other Markets) 2023 Second Quarter and First Six Months Results Second Quarter Performance First Six Months Performance (in millions) 2Q 23 2Q 22 (in millions) 2023 2022 Volume (lbs.) 6.2 9.6 (35)% Volume (lbs.) 13.6 20.2 (33)% Ne
Slide 7: Flexible Packaging Films (Terphane)
Flexible Packaging Films (Terphane) 2023 Second Quarter and First Six Month Results Second Quarter Performance First Six Months Performance (in millions) 2Q 23 2Q 22 (in millions) 2023 2022 Volume (lbs.) 23.7 27.3 (13)% Volume (lbs.) 43.6 53.3 (18)% Net Sales1 $33.2 $41.6 (20)% Net Sales1 $64.8 $80.
Slide 8: 2023 Year-to-Date Financial Highlights
Tredegar Corporation 2023 Year-to-Date Financial Highlights ($ in millions) Cash Flows provided by Operations $22.7 Capital Expenditures $15.9 Dividends Paid1 $8.9 Net Debt (Cash)2 $119.8 Net leverage ratio3 2.76x 1. Reflects dividends paid through 6/30/23. The Company suspended its quarterly divide
Slide 9: Appendix
‘Tredegar an < ) Appendix
Slide 10: Major Product Groups, Primary End Markets, Customers
Major Product Groups Primary End Markets Customers Competitors Aluminum Extrusions Custom designed, fabricated and Building and Construction: commercial windows & Glazing contractors and Hydro Extrusions North finished aluminum extrusions; value- doors, curtain walls, storefronts & entrances, automa
Slide 11: Tredegar's Global Presence
Tredegar’s Global Presence 10
Slide 12: Tredegar at a Glance
Tredegar at a Glance Business Strengths Aluminum Extrusions ➢ Industry-leading position in non-residential building and construction and value-added OEM components in North American extrusions market ➢ Market-focused manufacturing operations (including aluminum log casting capabilities) and world-cl
Slide 13: Aluminum Extrusions Business Profile
Aluminum Extrusions Business Profile Key Market Drivers • Strong demand for finished products, including anodized, $545 million LTM Net Sales1 painted products and fabricated components 8% • Growing aluminum content in vehicles, driven by CAFE Electrical & (corporate average fuel economy) standards
Slide 14: Index of North American Industry Volume for Bonnell's Key Markets
Aluminum Extrusions Index of North American Industry Volume for Bonnell’s Key Markets Note: Index computations based on Aluminum Association data (1982=1.0) through 2022. Specialty includes aluminum extrusions sold to consumer durables, electrical and machinery markets. 13
Slide 15: Aluminum Extrusions Key Markets
Aluminum Extrusions Key Markets - B&C/Automotive/Specialty 14
Slide 16: Automotive Aluminum Extrusion Applications
Aluminum Extrusions Automotive Aluminum Extrusion Applications ➢ Crash management systems – beams and mounting plates, crush cans ➢ Roof rails ➢ Electrical battery trays ➢ Air conditioner tube connectors Aluminum Overview Film Products Financials 15 Extrusions
Slide 17: Aluminum Extrusions Annual Historical Financials
Aluminum Extrusions Annual Historical Financials 2 Net Sales1 ($ in millions) EBITDA from Ongoing Ops ($ in millions) 638 $80 66 67 $600 530 539 545 55 56 456 46 $40 $300 $0 $0 2019 2020 2021 2022 LTM 2019 2020 2021 2022 LTM Volume (lbs. in millions) Capital Expenditures ($ in millions) 300 30 $30 2
Slide 18: PE Films Business Profile
PE Films Business Profile Key Growth Drivers $87 million LTM Net Sales1 • “Internet of Things” leading to greater connectivity and more displays and semiconductors 32% Overwrap • Thinner devices with increasing resolution and larger Packaging screen size • Demographic and workplace trends shifting t
Slide 19: End-Use Markets for Surface Protection Products
PE Films End-Use Markets for Surface Protection Products 18
Slide 20: Surface Protection Overview
PE Films Surface Protection Overview Typical LCD Optical Stack (examples: TVs, Smartphones) 19
Slide 21: PE Films Annual Historical Financials
PE Films Annual Historical Financials Net Sales1 ($ in millions) EBITDA from Ongoing Ops ($ in millions) $200 45 41 139 $40 $150 134 119 28 98 $100 71 $20 12 $50 0.5 $0 $0 2019 2020 2021 2022 LTM 2019 2020 2021 2022 LTM Volume (lbs. in millions) Capital Expenditures ($ in millions) 44 45 $10 9 39 40
Slide 22: Flexible Packaging Films Business Profile
Flexible Packaging Films Business Profile $152 million LTM Net Sales1 Key Growth Drivers • Growing end-user demand for convenience 27% foods, lighter packaging and branded consumer North products America & Other • Packaging innovation driving demand for flexible packaging Customers • Global and regi
Slide 23: Flexible Packaging Films End-Use and Value-Add Products
Flexible Packaging Films End-Use and Value-Add Products 22
Slide 24: Flexible Packaging Films Annual Historical Financials
Flexible Packaging Films Annual Historical Financials Net Sales1 ($ in millions) EBITDA from Ongoing Ops ($ in millions) $200 $40 168 32 152 31 134 135 140 $30 27 $100 $20 15 16 $10 $0 $0 2019 2020 2021 2022 LTM 2019 2020 2021 2022 LTM Volume (lbs. in millions) Capital Expenditures ($ in millions) 1
Slide 25: Tredegar Annual Historical Financials
Tredegar Corporation Annual Historical Financials 1 2 Net Sales ($ in millions) Consolidated EBITDA from Ongoing Ops ($ in millions) 904 $150 $900 797 798 768 730 92 96 $100 81 85 $600 $50 43 $300 $0 $0 2019 2020 2021 2022 LTM 2019 2020 2021 2022 LTM Earnings Per Share from Ongoing Ops3 Capital Expe
Slide 26: Capital Expenditures – History & Projections
Tredegar Corporation Capital Expenditures – History & Projections ($ in millions) 2023 2019 2020 2021 2022 Projection2 Aluminum Extrusions $17.9 $10.3 $18.9 $23.7 $19 PE Films1 8.6 6.0 3.0 3.3 3 Flexible Packaging 8.9 5.0 5.6 8.2 6 Corporate 0.2 0.2 (0.1) 1.7 0 Total $35.6 $21.5 $27.4 $36.9 $28 2023
Slide 27: Quarterly Cash Dividend
Tredegar Corporation Quarterly Cash Dividend ($) .13 .12 .11 .09 .07 .06 .045 .04 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Tredegar suspended its quarterly dividend on 8/3/2023. A special dividend of $5.97 per share was paid in 2020 and $0.75 per share was paid in 2012 2
Slide 28: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations
Slide 29: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations 28
Slide 30: GAAP to Non-GAAP Reconciliations: Summary Financial Information
GAAP to Non-GAAP Reconciliations 2. Summary Financial Information Year Ended December 31, LTM (in millions) 2019 2020 2021 2022 2023 Income and expense relating to ongoing operations: Total EBITDA for segments (a) $ 121.5 $ 130.8 $ 115.3 $ 106.2 $ 62.7 Pension expense (c) (9.6) (14.6) (14.1) - - Cor
Slide 31: GAAP to Non-GAAP Reconciliations: Summary Financial Information (continued)
GAAP to Non-GAAP Reconciliations 2. Summary Financial Information (continued) Notes: (a) Tredegar’s presentation of segment earnings before interest, taxes, depreciation and amortization from ongoing operations (“EBITDA") from ongoing operations aligns with key metrics used by the Chief Operating De
Slide 32: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations 31
Slide 33: GAAP to Non-GAAP Reconciliations: Net Debt
GAAP to Non-GAAP Reconciliations 5. Net debt is a non-GAAP financial measure that is not intended to represent debt as defined by GAAP, but is utilized by management in evaluating financial leverage and equity valuation. A calculation of net debt is shown below: (In millions) June 30, December 31, 2