Masco Corporation · NYSE:MAS
Masco — Raymond James 40th Annual Institutional Investors Conference (March 2019)
18 slides from Masco's conference presentation, Mar 4, 2019
Slide 1: Raymond James 40th Annual Institutional Investor Conference
Raymond James 40th Annual Institutional Investor Conference John Sznewajs, Chief Financial Officer March 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements that reflect our views about our future performance and constitute “forward- looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,”
Slide 3: Agenda
Agenda The Business Today Strategy for Profitable Growth Future Outlook 3
Slide 4: 2018 Segment Mix
2018 Segment Mix* R&R = % of sales to repair and remodel channels NC = % of sales to new construction channels NA = % of sales within North America Int’l = % of sales outside North America * Based on Company estimates 4
Slide 5: Market-Leading Brands
Market-Leading Brands MASCO S see what Delta can do-
Slide 6: Innovation Leadership Sustains Growth
Innovation Leadership Sustains Growth Examples of New Products / Technologies – 2015-2018 Delta® Zura® 2018 Pendant Shower Liberty® Shower Revenues Doors Behr® Marquee® Brizo® Litze® Behr Granite Hansgrohe® Grip® Coating 75% Metris® Select Faucet Coating Collection Existing 25%* Products Cardell® Mi
Slide 7: Diversified Business Mix Results in More Stable Revenues
Diversified Business Mix Results in More Stable Revenues Segments* Price Points Channels New Low ticket value ~$20 Big box retail construction 15% Repair / Wholesale / trade remodel 85% Direct-to-builder International High ticket luxury ~$20K 19% E-commerce N. America 81% Specialty dealers * Based o
Slide 8: Fundamentals Support Continued Steady Growth
Fundamentals Support Continued Steady Growth 5 4 International Growth 3 Household Formation 2 Housing Turnover 1 Home Price Appreciation Age of U.S. Housing Stock 8
Slide 9: Agenda
Agenda The Business Today Strategy for Profitable Growth Future Outlook 9
Slide 10: Clear Strategic Focus
Clear Strategic Focus 1 Drive full potential of our businesses 2 Leverage opportunities across our portfolio 3 Actively manage portfolio 10
Slide 11: Agenda
Agenda The Business Today Strategy for Profitable Growth Future Outlook 11
Slide 12: Positioned to Outperform
Positioned to Outperform Growing industry with strong macro 2019 Outlook fundamentals Revenue: + 3-5% growth Strong foundation to sustain and improve (ex currency) performance + Operating Margin: Similar to 2018 Credible, proven plan for profitable growth margin of 15.1% + Adjusted EPS: Strong cash
Slide 13: Q&A
Q&A
Slide 14: Appendix
Appendix
Slide 15: 2018 Profit and 2019 EPS Outlook Reconciliations
2018 Profit and 2019 EPS Outlook Reconciliations ($ in Millions) 2018 Net sales $ 8,359 Operating profit, as reported $ 1,211 Rationalization charges 14 Kichler inventory step up adjustment 40 Operating profit, as adjusted $ 1,265 Operating margin, as reported 14.5% Operating margin, as adjusted 15.
Slide 16: 2019 Estimates
2019 Estimates ($ in Millions) 2019 Estimate Rationalization Charges ~ $4 Tax Rate ~ 25% General Corporate Expense ~ $90 Interest Expense ~ $157 Pension Expense Included in ‘Other expense’ ~ $20 Capital Expenditures ~ $200 Depreciation & Amortization ~ $175 Unfavorable Foreign Currency Translation ~
Slide 17: 2019 Outlook
2019 Outlook 2019 2019 Business Segment Sales Adjusted Operating Other Growth Profit Margin • ~$65m unfavorable FX impact on 3 – 5% Similar to 2018 Plumbing Products 2019 sales (ex currency) margin of 18.1% • D&A ~$20m per quarter Decorative Architectural 4 – 6% 17.0% - 18.0% • D&A ~$12m per quarter
Slide 18: 2018 Geographic Revenue Split
2018 Geographic Revenue Split* Other China United 2% 2% Kingdom 4% Europe 11% North America 81% International Sales Accounted for ~19% of Total 2018 Masco Sales *Based on Company estimates 18
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