Msc Industrial Direct Company, Inc. · NYSE:MSM
Msc Industrial Direct — Q4 2024 Earnings Presentation
24 slides from Msc Industrial Direct's earnings presentation, Oct 24, 2024
Slide 1: Fiscal Fourth Quarter 2024 Earnings
FISCAL FOURTH QUARTER 2024 EARNINGS OCTOBER 24, 2024
Slide 2: Cautionary Note Regarding Forward-Looking Statements
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Statements in this presentation may constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of present or historical fact, that address activities, events or develop
Slide 3: Fiscal Fourth Quarter and Full Year 2024 Highlights
FISCAL FOURTH QUARTER AND FULL YEAR 2024 HIGHLIGHTS Average daily sales down 8.0% YoY in 4Q’24 and 4.7% in FY’24 driven by ongoing softness in heavy 1 manufacturing verticals that persisted throughout the fiscal year and headwinds from non-recurring public sector orders Gross margins exceeded expect
Slide 4: Taking Action to Return Growth Well Above Industrial Production
TAKING ACTION TO RETURN GROWTH WELL ABOVE INDUSTRIAL PRODUCTION MSC Total Organic Sales Growth 3-Month Average – IP Index* MSC Total Growth (3 Mo Avg) 20% IP Index Performance YoY of 15% MSC’s Top 5 Industries 10% Industry Group 4Q’24 FY’24 Machinery & Equipment (1.6)% (3.2)% 5% Primary Metals (2.6)
Slide 5: Improving Execution and Long-Term Position Despite Market Softness Continuing in Fiscal 2025
IMPROVING EXECUTION AND LONG-TERM POSITION DESPITE MARKET SOFTNESS CONTINUING IN FISCAL 2025 Priority Detail • 342 In-Plant programs at FY’24 end +29% YoY Maintain Solutions • 27,003 installed vending units at FY’24 end +9% YoY Momentum • FY’24 National Account ADS approximately 150 bps above the IP
Slide 6: Fiscal Year 2024 Reported and Adjusted Results
FISCAL YEAR 2024 REPORTED AND ADJUSTED RESULTS Net Sales Gross Profit Operating Profit Earnings (millions) (millions and % of sales) (millions and % of sales) (per diluted share) Reported Adjusted* Reported Adjusted* $4,009.3 $3,821.0 $1,643.0 $1,572.8 $6.11 $6.29 $483.7 $504.5 $390.4 $407.2 $4.58 $
Slide 7: Taking Action to Unlock Productivity Across the Organization
TAKING ACTION TO UNLOCK PRODUCTIVITY ACROSS THE ORGANIZATION Network Optimization Customer Coverage Enhancements Supply Chain Simplification Territory Coverage and Service Optimization • Integrating C-part and OEM fastener categories to MSC sourcing and • Maximizing seller potential and coverage thr
Slide 8: Fiscal Fourth Quarter 2024 Reported and Adjusted Results
FISCAL FOURTH QUARTER 2024 REPORTED AND ADJUSTED RESULTS Net Sales Gross Profit Operating Profit Earnings (millions) (millions and % of sales) (millions and % of sales) (per diluted share) Reported Adjusted* Reported Adjusted* $419.5 $130.4 $1.64 $1,035.4 $952.3 $390.6 $118.1 $1.56 $90.9 $94.2 $1.03
Slide 9: Fiscal Fourth Quarter 2024 Balance Sheet and Cash Flow
FISCAL FOURTH QUARTER 2024 BALANCE SHEET AND CASH FLOW Free Cash Flow* Quarterly (millions) Year to Date $104.1 $607.1 • Strong operating cash flow during the quarter primarily $81.2 driven by working capital improvement resulting in 4Q'operating cash flow conversion of 199%** $311.3 • Free cash flo
Slide 10: Clear Capital Allocation Priorities
CLEAR CAPITAL ALLOCATION PRIORITIES Long-Term Priorities Dividends and Share Strategic Significant capital allocation optionality after deprioritizing special dividends; potential uses include organic growth investments, Repurchases Optionality strategic M&A, debt paydown, or further deployment to s
Slide 11: First Quarter Expectations Reflect Higher Costs in a Challenging Demand Environment
FIRST QUARTER EXPECTATIONS REFLECT HIGHER COSTS IN A CHALLENGING DEMAND ENVIRONMENT Down 5.5% to 4.5% YoY 7.0% to 7.5% 1Q’25 OUTLOOK AVERAGE DAILY SALES (ADS) ADJUSTED OPERATING MARGIN** ADS YoY TRENDS ASSUMPTIONS 1Q’24 2Q’24 3Q’24* 4Q’24* 1Q’25 • ADS softness driven by ongoing weakness in end 5% ma
Slide 12: Assumed FY'25 Average Daily Sales Cadence and Guided Metrics
ASSUMED FY’25 AVERAGE DAILY SALES CADENCE AND GUIDED METRICS FY’25 MODELING $90-$95M ~$45M $100-$110M*** ~100% 24.5%-25.0% Depreciation and Interest and Other Capital Free Cash Flow Tax ASSUMPTIONS Amortization Expense Expenditures Conversion* Rate AVERAGE DAILY SALES CADENCE 1Q’25 ADS Mid Point 1Q
Slide 13: Summary
SUMMARY Average daily sales down 8.0% YoY in 4Q’24 and 4.7% in FY’24 driven by ongoing softness in heavy 1 manufacturing verticals that persisted throughout the fiscal year and headwinds from non-recurring public sector orders Gross margins exceeded expectations in 4Q’24 with 10 bps of improvement c
Slide 14: Appendix
APPENDIX MSC
Slide 15: Reconciliations: Non-GAAP Financial Measures
RECONCILIATIONS Non-GAAP Financial Measures To supplement MSC’s unaudited selected financial data presented consistent with accounting principles generally accepted in the United States (“GAAP”), the Company discloses certain non-GAAP financial measures, including return on invested capital (as defi
Slide 16: Reconciliations: Non-GAAP Financial Measures
RECONCILIATIONS Non-GAAP Financial Measures Results Excluding ERC Tax Benefit (prior year), Restructuring and Other Costs, Acquisition-Related Costs, and Share Reclassification Costs In calculating non-GAAP financial measures, we exclude ERC tax benefit (prior year), restructuring and other costs, a
Slide 17: Reconciliations
RECONCILIATIONS investor.mscdirect.com 17
Slide 18: Reconciliations
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Slide 19: Reconciliations
RECONCILIATIONS investor.mscdirect.com 19
Slide 20: Reconciliations
RECONCILIATIONS investor.mscdirect.com 20
Slide 21: Reconciliations
RECONCILIATIONS investor.mscdirect.com 21
Slide 22: Reconciliations
RECONCILIATIONS investor.mscdirect.com 22
Slide 23: Reconciliations
RECONCILIATIONS investor.mscdirect.com 23
Slide 24: Thank You
THANK YOU MSC
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