Armstrong World Industries Inc · NYSE:AWI
Armstrong World Industries — Q1 2015 Earnings Presentation
17 slides from Armstrong World Industries's earnings presentation, Apr 30, 2015
Slide 1: Earnings Call Presentation 1st Quarter 2015
Exhibit 99.2 Earnings Call Presentation st 1 Quarter 2015 April 30, 2015
Slide 2: Safe Harbor Statement
Safe Harbor Statement Our disclosures in this presentation, including without limitation, those relating to future financial results guidance and the possible separation of our flooring business from our building products business, and in our other public documents and comments contain forward-looki
Slide 3: Basis of Presentation Explanation
Basis of Presentation Explanation • When reporting our financial results within this presentation, we make several adjustments. Management uses the non-GAAP measures below in managing the business and believes the adjustments provide meaningful comparisons of operating performance between periods. A
Slide 4: Key Metrics – First Quarter 2015
Key Metrics – First Quarter 2015 2015 2014 Variance Net Sales (1) $565 $584 (3.3%) Operating Income (2) 46 55 (17.5%) % of Sales 8.1% 9.5% (140 bps) EBITDA 75 83 (10.2%) % of Sales 13.2% 14.3% (110 bps) Earnings Per Share (3) $0.37 $0.43 (13.9%) Free Cash Flow (42) (56) 24.9% Net Debt 903 977 (74) R
Slide 5: First Quarter 2015 vs. PY – Adjusted EBITDA to Reported Net Income
First Quarter 2015 vs. PY– Adjusted EBITDA to Reported Net Income 2015 2014 V EBITDA – Adjusted $75 $83 ($8) Depreciation and Amortization (29) (28) (1) Operating Income – Adjusted $46 $55 ($9) Non-cash Impact of U.S. Pension 6 - 6 Foreign Exchange Movements 2 1 1 Separation Expenses 4 - 4 Cost Redu
Slide 6: First Quarter Sales and EBITDA by Segment – 2015 vs. Prior Year
First Quarter Sales and EBITDA by Segment – 2015 vs. Prior Year EBITDA Change (Left-hand scale) % Change in Sales (Right-hand scale) 10 10% 5 5% 3 - 1 0% 0% (6) (6) (3%) (5%) (5) (10) (10%) (12%) (15) (15%) Resilient Flooring Wood Flooring Building Products Corporate 6
Slide 7: Building Products First Quarter Results
Building Products First Quarter Results Net Sales Key Highlights $302 $302 • On a comparable foreign exchange basis sales were $31 $30 flat over a strong base period (sales were up over 5% $78 $78 in the first quarter of 2014). Price and mix both improved offsetting volume declines in the Americas a
Slide 8: Resilient First Quarter Results
Resilient First Quarter Results Net Sales Key Highlights $159 $164 • Sales declined as volume, price and mix were all $17 $16 unfavorable compared to the prior year • On a comparable foreign exchange basis sales in the Pacific Rim increased slightly as softness in China was $142 $148 more than offse
Slide 9: Wood First Quarter Results
Wood First Quarter Results Net Sales Key Highlights $118 • Sales declined despite improvements in price and mix $103 • Volume declines were caused by market share shifts as a result of prior year price and mix optimization $118 actions and inventory adjustments at home centers $103 Q1 2015 Q1 2014 A
Slide 10: EBITDA Bridge – First Quarter 2015 vs. Prior Year
EBITDA Bridge – First Quarter 2015 vs. Prior Year $120 $100 $12 $83 $80 $2 $1 $75 ($17) ($2) ($3) ($1) $60 $40 $20 $0 2014 Price/Mix Volume Input Costs Mfg Cost SG&A WAVE Change in 2015 D&A
Slide 11: Free Cash Flow – First Quarter 2015 vs. Prior Year
Free Cash Flow – First Quarter 2015 vs. Prior Year $0 ($20) ($40) $20 ($42) $15 ($60) ($56) $0 ($3) $9 ($80) ($27) ($100) 2014 Cash Working Capex Interest WAVE Other 2015 Earnings Capital Expense Dividends 11
Slide 12: Key Metrics – Guidance 2015
Key Metrics – Guidance 2015 2015 Estimate Range (1) 2014 (2) Variance Net Sales(3) 2,525 to 2,625 2,515 0% to 4% Operating Income (4) 230 to 270 271 (15%) to (1%) EBITDA 350 to 390 389 (10%) to 0% Earnings Per Share (5) $2.00 to $2.40 $2.38 (16%) to 1% (1) Guidance is presented using 2015 budgeted f
Slide 13: 2015 Financial Outlook
2015 Financial Outlook ABP Segment Sales(1) $1,300-$1,350 million; EBITDA $335-$360 million AFP Segment Sales(1) $1,225-$1,275 million; EBITDA $80-$100 million Corporate Segment EBITDA ($65) – ($70) Cash Taxes/ETR* $35 - $45 million; Adjusted long-term ETR of ~39% (2) Capital Spending $125 - $150 mi
Slide 14: Appendix
Appendix Inspiring Great Spaces™
Slide 15: Consolidated Results
Consolidated Results First Quarter 2015 Comparability (1) 2015 2014 Comparability (1) 2014 FX(2) Adj FX(2) Adj Reported Adjustments Adjusted Reported Adjustments Adjusted Net Sales 551 - 14 565 590 - (6) 584 Operating 36 8 2 46 54 - 1 55 Income EPS $0.07 $0.28 $0.02 $0.37 $0.33 $0.09 $0.01 $0.43 (1)
Slide 16: Segment Operating Income (Loss)
Segment Operating Income (Loss) First Quarter 2015 Comparability (1) 2015 2014 Comparability (1) 2014 Reported Adjustments Adjusted Reported Adjustments Adjusted Building Products 60 - 60 58 1 59 Resilient Flooring 6 (1) 5 10 - 10 Wood Flooring (1) - (1) 5 - 5 Unallocated Corporate (29) 11 (18) (19)
Slide 17: Cash Flow
Cash Flow First Quarter ($ millions) 2015 2014 Net cash (used for) operations ($34) ($33) Net cash (used for) investing (8) (22) Add back (subtract) adjustments to reconcile to free cash flow Other - (1) Free Cash Flow ($42) ($56) 17 Cash flow includes cash flows attributable to the European floorin
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