Hayward Holdings, Inc. · NYSE:HAYW
Hayward — Investor Presentation (June 2021)
28 slides from Hayward's investor presentation, June 2021
Slide 1: Investor Presentation
Investor Presentation June 2021 © 2021 Hayward Holdings, Inc. 1
Slide 2: Cautionary Statement
Cautionary Statement SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements and information relating to the Company that are based on the beliefs of management as well as assumptions made by, and information currently available to management. These st
Slide 3: I. Hayward Overview
I. Hayward Overview © 2021 Hayward Holdings, Inc. 3
Slide 4: Hayward at a Glance
Hayward at a Glance Net Sales by Net Sales by End Net Sales by Segment Market Product Category Replacement White Goods Parts 5% 6% ESG Commercial North America Residential Pool Pumps Relevance 2% 81% 93% Flow Control 19% ~89% 5% Lighting Heating 6% 19% Commercial Cleaners Filters Europe & Rest Pool
Slide 5: Core Values Drive Commitment to ESG
Core Values Drive Commitment to ESG Core Values ✓ Focus on environmentally sustainable products ✓ Commitment to a safe and inclusive workplace ✓ Responsible manufacturing practices ✓ Clear governance and compliance practices © 2021 Hayward Holdings, Inc. 5
Slide 6: Hayward is at the Center of Outdoor Living
Hayward is at the Center of Outdoor Living The pool is the “centerpiece” of the ultimate backyard experience Lighting HVAC Decking Irrigation Pool © 2021 Hayward Holdings, Inc. 6
Slide 7: What Makes Us Different?
What Makes Us Different? Operational Excellence ✓ Increased Q1 2021 production >75% Innovative, ESG Product Focus ✓ Attractive new solutions – grows the AquaRite Salt Chlorine Generators market and Hayward share OmniLogic Automation Variable Speed Pumps Channel Presence ✓ Broad, longstanding relatio
Slide 8: Hayward Products are Essential Components of the Pool Pad
Hayward Products are Essential Components of the Pool Pad Smart Pad technology key to function and core to enhancing outdoor living experience Hayward has a complete range… ✓ Smart IoT enabled controls ✓ Salt chlorine generators & UV/Ozone water sanitizers ✓ High efficiency variable speed pumps and
Slide 9: Omni is the Solution to Smart Pad Conversion
Omni is the Solution to Smart Pad Conversion Create the ultimate connected backyard experience – Drive value for Hayward Consumer Expectations Shifting… ✓ Smart, Effortless Control ✓ Comfort & Ambiance ✓ Environmentally Conscious …Creates Value for Hayward ✓ Acceleration of Upgrade Cycle ✓ Consumer/
Slide 10: New Product Innovation Focus on ESG
New Product Innovation Focus on ESG 90% Reduction in energy use 1.1bn kWh saved from variable speed pumps 50% Reduction in chlorine use 81m lbs Less chemical chlorine by salt/UV/ozone Pool Pad Equipment: In and Around the Pool: 16% Variable Speed Pumps Robotic Cleaners Reduction in water use Omni Co
Slide 11: II. Growth Drivers
II. Growth Drivers © 2021 Hayward Holdings, Inc. 11
Slide 12: Hayward's Value Creation Model
Hayward’s Value Creation Model Attractive Market Themes Aftermarket-Driven Outdoor Living, Well-Defined Core to Our Earnings Repair and Replacement Environmentally-Friendly Lifestyle & Health Channel Dynamics and Cash Flow (R&R) Core Strengths Culture & Vertically Digitization & Drives Price, Market
Slide 13: The Pool Industry – Attractive and Growing
The Pool Industry – Attractive and Growing Large Growing Predictable 25m 1970 7 to 15 Year Installed base of US in-ground installed base has grown Product replacement cycle global pools(1) every year since 1970 $5.0b TAM 7% 63% CAGR of new US in-ground residential US pools built before 2000, driving
Slide 14: Smart Pad Conversion – Driving Hayward Growth
Smart Pad Conversion – Driving Hayward Growth Legacy Pool Technology Rich Pool - Smart Pad Variable Speed Pumps, Cartridge Filters, Gas & Single Speed Pump, Filter, White Light, Time Clock, Heat Pump, Salt Chlorinator, UV/Ozone/AOP Typical Equipment Suction Cleaner Sanitizer, Color LED Lights, Contr
Slide 15: Smart Pad Conversion – Penetration and Spend Opportunity
Smart Pad Conversion – Penetration and Spend Opportunity Current Penetration of Installed Retail Value of Legacy Pad Vs. Base Smart Pad ~$7,500 With Smart Pool Controls ~28% ~$3,500 Without ~72% Legacy Pad Smart Pool Pad >50% of new pools constructed in 2020 Control Upgrades Lead to Broader have sma
Slide 16: Smart Pad Conversion – Digital Conversion and ESG-Friendly Product Upgrades
Smart Pad Conversion – Digital Conversion and ESG-Friendly Product Upgrades Smart Pad Conversion Digital Conversion & ESG-Friendly Product Digital Conversion ESG Conversion Upgrades Tied to Smart Pad Conversion Energy Consumer to Energy Manual to Automatic Chemical to Equipment 1 IoT Enabled Control
Slide 17: Hayward is a Leader in Smart Pad Technology
Hayward is a Leader in Smart Pad Technology #1 Rated App Most Energy-Efficient Pump #1 Rated in Salt Chlorination © 2021 Hayward Holdings, Inc. 17
Slide 18: Secular Growth Tailwinds – Sustainable Demand
Secular Growth Tailwinds – Sustainable Demand ✓ Demographic and secular trends drive increased demand for new pool construction, full remodels & upgrades ✓ Capacity constraints in addressing demand for new pools, driving long-term tail to new construction ✓ Growing & aging aftermarket provides sourc
Slide 19: Trends Support Long-Term Growth
Trends Support Long-Term Growth Inflation Pricing New Construction New Pool Construction – Home Historical Market ~25% of investment and outdoor living trends Growth Rate of 6% to business 8% per annum Aftermarket Repair Replace – continued expansion of large aftermarket annuity Full Remodel – whole
Slide 20: III. Financial Performance
III. Financial Performance © 2021 Hayward Holdings, Inc. 20
Slide 21: First Quarter 2021 Highlights
First Quarter 2021 Highlights 96% YoY1 Record Net Sales of $334 million, LTM2 >$1 billion Net Sales growth ✓ Expanded production capacity to meet strong demand and order file +340bps YoY Gross Profit of $160 million, 47.8% of Net Sales Gross Profit Margin expansion ✓ Driven by volume leverage, price
Slide 22: 2021 Financial Outlook
2021 Financial Outlook ✓ Net Sales growth 40% to 45% YoY Full Year ✓ Adjusted EBITDA1 of $360m to $390m; up 55% to 68% YoY Outlook Reflects: ✓ Strong Q1 results and increased visibility into 2021 with robust backlog ✓ Continued broad based strength across products ✓ Market demand to remain healthy f
Slide 23: Strong Financial Performance (in millions)
Strong Financial Performance (in millions) NET SALES ADJUSTED EBITDA AND MARGIN New ownership & management team 350 1 $303 0.9 $1,040 300 0.8 $875 250 $232 0.7 $778 $196 0.6 $635 200 $578 $151 0.5 $521 $136 150 0.4 $112 100 29.1% 0.3 23.4% 23.7% 25.1% 26.5% 21.4% 0.2 50 0.1 0 0 2012 2014 2016 2018 2
Slide 24: Strong Financial Performance (in millions)
Strong Financial Performance (in millions) CAPEX & CAPEX % of NET SALES ADJUSTED FREE CASH FLOW & ADJUSTED FCF CONVERSION (1) 0.1 87.5% 84.6% 89.4% 91.3% 94.0% 95.0% 70 325 0.09 60 0.08275 50 0.07225 40 0.06 175 0.05 $288 30 $21 0.04125 $179 $218 20 $16 $17 $15 $14 $14 0.03 75 $115 $135 3.6% 2.6% $9
Slide 25: Most Attractive Valuation in Peer Group Despite Superior Financial Profile
Most Attractive Valuation in Peer Group Despite Superior Financial Profile FY’20A–’23E Revenue CAGR FY’20A–’23E EBITDA CAGR 25% 23% 35% 21% 28% 30% 20% 17% 17% 24% 25% 23% 23% 16% 15% 13% 20% 19% 11% 12% 20% 16% 17% 16% 10% 9% 15% 13% 10% 11% 11% 7% 6% 10% 6% 10% 5% 5% 0% 0% Latham Generac Trex Hayw
Slide 26: Hayward's Value Proposition
Hayward’s Value Proposition Pure Play Market Leader in Growing Outdoor Living Sector Smart IoT Enabled, Environmentally Conscious Products Competitive Moat - Scale, Brand, and Large Installed Base Recurring Sales Model Provides Stable Growth Growth Initiatives Creating Incremental Value © 2021 Haywa
Slide 27: Appendix
Appendix Non-GAAP Reconciliations © 2021 Hayward Holdings, Inc. 27
Slide 28: Adjusted EBITDA and Adjusted EBITDA Margin Reconciliation
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliation © 2021 Hayward Holdings, Inc. 28