15 slides from A.o. Smith's earnings presentation, Apr 29, 2025
Slide 1: First Quarter 2025 Results
First Quarter 2025 Results April 29, 2025 First Quarter 2025 Earnings Presentation | 1
Slide 2: Presenters
Kevin J. Wheeler Stephen M. Shafer Charles T. Lauber Helen E. Gurholt Chairman and President and Executive Vice President Vice President - Investor Relations, Chief Executive Officer Chief Operating Officer and Chief Financial Officer Financial Planning & Analysis First Quarter 2025 Earnings Present
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements generally can be identified by the use of words such as “may,” “will,” “expect,” “
Slide 4: First Quarter Messages
First Quarter Messages 1 2 3 4 5 Sales of $964M North America China sales 200+ bps Pureit added $12 and EPS of $0.95 sales declined decreased 4% in operating margin million to Rest of 2% compared to local currency improvement in World sales a tough prior year driven by China and North comp; up 9% co
Slide 5: First Quarter Performance and Highlights
First Quarter Performance and Highlights Sales EPS Segment Sales Segment Earnings $1.00 $749M $979M $964M $0.95 $185M -2% -5% YOY YOY $227M $20M Q1 2024 Q1 2025 Q1 2024 Q1 2025 North America Rest of World North America Rest of World Highlights North America Rest of World • Net sales decreased 2 perc
Slide 6: First Quarter North America Segment
First Quarter North America Segment Segment Sales ($M) Segment Operating Earnings ($M) $766 $3 $749 $199 $185 $(16) ($4) $(5) $(6) $(3) -2% 25.9% 24.7% YOY Q1 2024 Sales Organic Growth Acquisition FX Q1 2025 Sales Q1 2024 Earnings Organic Growth Input Costs SG&A and FX Q1 2025 Earnings • Sales decre
Slide 7: First Quarter Rest of World Segment
First Quarter Rest of World Segment Segment Sales ($M) Segment Operating Earnings ($M) $227 $12 $227 $(2) $(10) FLAT $5 $20 $17 ($2) 8.7% 7.6% Q1 2024 Sales Organic Growth Acquisition FX Q1 2025 Sales Q1 2024 Earnings Organic Growth SG&A and Other Q1 2025 Earnings • Flat sales as lower China volumes
Slide 8: Cash Flow and Liquidity
Cash Flow and Liquidity1 $200M Free Cash Flow ($M) Cash Flow From Operations ($M) Cash balance2 $107 $85 12.7% Debt to capital ratio $70M $39 Net debt position $17 ~1.8M Q1 2024 Q1 2025 Q1 2024 Q1 2025 Shares repurchased in Q1 2025 totaling ~$121M 1As of March 31, 2025 2Includes cash, cash equivalen
Slide 9: Capital Allocation Priorities
Capital Allocation Priorities Organic Growth • Opportunities for organic growth in all our businesses and geographies • Disciplined focus on transactions that expand/grow the core, enable geographic growth, and establish adjacencies Acquisitions • Recent transactions include Pureit and Impact Water
Slide 10: 2025 Outlook and Assumptions
2025 Outlook and Assumptions1 Revenue Increase ~Flat to 2% U.S. Residential Water Heater Industry ~Flat 2025 Guidance 2024 Commercial Water Heater Industry ~Flat China Sales Decrease (Local Currency) ~-5% to -8% Diluted EPS (GAAP) $3.60 - $3.90 $3.63 North American Boiler Sales Growth ~3% to 5% Nort
Slide 11: Tariff Impact & Actions Taken to Mitigate Risk
Tariff Impact & Actions Taken to Mitigate Risk Potential Annualized Tariff Exposure: ~6 to 8% of Cost of Goods Sold • Majority of North American Segment capacity is based in U.S. • 15% of U.S. residential tank water heater production in Mexico and is USMCA compliant • Accelerated transition of gas t
Slide 12: Continuing to Execute Our Strategy
Continuing to Execute Our Strategy Product Development Center • Opened in Lebanon, TN • Leverages commercial engineering talent and expands commercial testing capabilities A. O. Smith Recognized for Ethics For 2nd Year in a Row First Quarter 2025 Earnings Presentation | 12
Slide 13: A. O. Smith. Innovation has a name.
(<eSmith. Innovation has a name.
Slide 14: Powerful Investment Thesis
Powerful Investment Thesis 1 2 3 4 5 Leading with Capitalizing Leading Compelling Leveraging strong innovative on global North American brand awareness balance sheet products that megatrends in a water heater and in emerging for organic drive technology large and growing boiler producer markets with
Slide 15: Free Cash Flow
Free Cash Flow ($ in Millions) First Quarter 2025 Earnings Presentation | 15