Siteone Landscape Supply, Inc. · NYSE:SITE
Siteone Landscape Supply — Q4 2022 Earnings Presentation
24 slides from Siteone Landscape Supply's earnings presentation, Feb 15, 2023
Slide 1: Fourth Quarter and Full Year 2022 Earnings
Fourth Quarter and Full Year 2022 Earnings
Slide 2: Disclaimer
Disclaimer Forw ard-Looking Statements This presentation contains “forward-looking statements” w ithin the meaning of the Private Securities Litigation Reform Act of 1995. Forw ard-looking statements may include, but are not limited to, statements relating to our 2022 Adjusted EBITDA outlook and our
Slide 3: Conference call agenda
Conference call agenda Introduction John Guthrie, CFO Business Update Doug Black, Chairman and CEO Financial Update John Guthrie, CFO Development Update Scott Salmon, EVP Strategy & Development Closing & Outlook Doug Black, Chairman and CEO Q&A 3
Slide 4: Company and industry overview
Company and industry overview ■ Largest and only national full product line wholesale distributor of landscape supplies ■ $25 billion highly fragmented market(1) ■ More than four times the size of next competitor and only ~16% market share(1) ■ Serving residential and commercial landscape profession
Slide 5: SiteOne is poised for continued growth and margin enhancement
SiteOne is poised for continued growth and margin enhancement Current strategy ✓ Leverage strengths of both large and local company ■ Fully exploit our scale, resources and capabilities ■ Execute local market growth strategies ■ Deliver superior value to our customers and suppliers ■ Close and integ
Slide 6: Track record of performance and growth
Track record of performance and growth Net Sales Adjusted EBITDA ($ in Millions) ($ in Millions) $464 $4,015 ’16-’22 $415 $3,476 ’16-’22 Growth Growth $2,705 35.4% $2,358 34.9% Sales $ $260 Adj. EBITDA $ $2,112 11.9% $1,862 33.3% +144% $201 11.6% +246% $1,648 $176 32.8% $157 GM % $134 32.0% 32.1% 9.
Slide 7: Significant room to grow across product lines
Significant room to grow across product lines # of markets (1) Missing either Missing both Full Product No Hardscapes or Hardscapes Line Offering Presence Nursery and Nursery SiteOne offers all ~55 product lines in only ~21% of our target markets today… ~70 ~65 ~50 (1) Target markets as of Q4 2022 a
Slide 8: Fiscal Year 2022 highlights
Fiscal Year 2022 highlights Fiscal Year 2022 highlights (compared to Fiscal Year 2021): ✓ Net sales increased 16% to $4.01 billion ✓ Organic Daily Sales increased 11% ✓ Gross profit increased 17% to $1.42 billion; gross margin increased 50 basis points to 35.4% ✓ SG&A as a percentage of Net sales in
Slide 9: 2022 ESG highlights
2022 ESG highlights Formation of ESG Steering Launched SiteOne CARES Leadership Academy and Enhanced Supply Chain Committee Grant Assistance Program Line of Business for Our Associates Certifications Eco-Friendly Product Improved Fleet Efficiency Offerings Enhanced Hourly Associate Increased % of Br
Slide 10: Review of Fourth Quarter 2022 financial results
Review of Fourth Quarter 2022 financial results Summary financials Financial highlights ($ in millions) +11% ■ Net sales increased 11% YoY to $890.0 Million – Organic Daily Sales increased 7% due to price inflation, 890.0 partially offset by lower volume Net sales 805.2 – Acquired sales growth was $
Slide 11: Review of Fiscal Year 2022 financial results
Review of Fiscal Year 2022 financial results Summary financials Financial highlights ($ in millions) +16% ■ Net sales increased 16% YoY to $4.01 billion – Organic Daily Sales increased 11% due to price inflation, Net sales 4,014.5 partially offset by lower volume 3,475.7 – Acquired sales growth was
Slide 12: Balance sheet & cash flow highlights
Balance sheet & cash flow highlights Year ended January 1, 2023 Balance sheet & cash flow highlights (compared to prior-year period) (in $ millions) ■ Working capital increased to $759.5 million, compared to $615.9 million – Inventory levels higher due to cost inflation, acquisitions, and Working ca
Slide 13: Balanced approach to capital allocation (2022)
Balanced approach to capital allocation (2022) ✓Healthy cash flow generation ✓Low capex requirements Return capital to shareholders through share repurchase ✓Flexible balance sheet Maintain conservative $25 million in shares repurchased balance sheet for strategic flexibility 0.8x Net Debt / Adj. EB
Slide 14: Proven track record of successful acquisitions
Proven track record of successful acquisitions 2014 - 2018 2019 2020 2021 2022 Total 2017 ▪ Pete Rose ▪ Cutting Edge ▪ Wittkopf Landscape ▪ Lucky Landscape ▪ JK Enterprise Supplies ▪ Atlantic Irrigation ▪ All Pro Horticulture ▪ Arizona Stone & ▪ BellStone Masonry ▪ Empire Supplies Solstice ▪ Village
Slide 15: M&A continues to add significant value
M&A continues to add significant value Madison Block & Stone ✓Closed on October 13th ✓Establishes a leading hardscapes presence in the Madison, Wisconsin market ✓Purchasing synergies ✓Cross-selling synergies SiteOne Madison Block & Stone Source: Company data 15
Slide 16: M&A continues to add significant value
M&A continues to add significant value Telluride Natural Stone ✓Closed on December 16th ✓Extends our leading hardscapes presence in the Phoenix, Arizona market ✓Purchasing synergies ✓Cross-selling synergies SiteOne Telluride Source: Company data 16
Slide 17: M&A continues to add significant value
M&A continues to add significant value Whittlesey Landscape Supplies ✓Closed on December 21st ✓Establishes a leading landscape supplies and hardscapes presence in the Austin, Texas market ✓Purchasing synergies ✓Cross-selling synergies SiteOne Whittlesey Source: Company data 17
Slide 18: Robust pipeline provides significant growth opportunity
Robust pipeline provides significant growth opportunity ✓ SiteOne is the leading industry consolidator 16% ✓ Significant sourcing advantage with 80+ associates scouting new growth opportunities 84% ✓ Our pipeline is deep and expanding ~$25bn market(1) ✓ Experienced M&A team driving strong acquisitio
Slide 19: 2023 Outlook
2023 Outlook ✓ Overall market expected to be down with weakness in new residential construction partially offset by flat to modest growth in other end markets ✓ Key commercial and operational initiatives expected to support market share gains ✓ Organic Daily Sales growth expected to be flat to down
Slide 20: Investment highlights
Investment highlights Uniquely Clear market leader attractive industry Compelling and Proven management sustainable team growth strategy Operational and Value-creating commercial acquisitions excellence 20
Slide 21: Appendix
Appendix Non-GAAP Reconciliations
Slide 22: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation 2022 2021 ($ in millions) FY’22 Q4’22 Q3’22 Q2’22 Q1’22 FY’21 Q4’21 Q3’21 Q2’21 Q1’21 Reported Net income $245.4 $(0.9) $73.3 $140.7 $32.3 $238.4 $27.5 $80.0 $123.5 $7.4 Income tax (benefit) expense 67.7 (4.6) 22.9 44.8 4.6 56.1 2.7 19.1 36.8 (
Slide 23: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation ($ in millions) 2022 2021 2020 2019 2018 2017 2016 Reported Net income $245.4 $238.4 $121.3 $77.7 $73.9 $54.6 $30.6 Income tax expense 67.7 56.1 27.5 13.8 1.3 18.0 21.3 Interest expense, net 20.0 19.2 31.0 33.4 32.1 25.2 22.1 Depreciation & amo
Slide 24: Non-GAAP reconciliations
Non-GAAP reconciliations 2022 Organic Daily Sales Reconciliation 2022 2021 ($ in millions) FY’22 Q4’22 Q3’22 Q2’22 Q1’22 FY’21 Q4’21 Q3’21 Q2’21 Q1’21 Reported Net Sales $4,014.5 $890.0 $1,102.6 $1,216.6 $805.3 $3,475.7 $805.2 $936.4 $1,083.9 $650.2 A Organic Sales $3,738.4 $815.0 $1,017.8 $1,145.5
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