Core & Main, Inc. · NYSE:CNM
Core & Main — Q1 2023 Earnings Presentation
18 slides from Core & Main's earnings presentation, Jun 6, 2023
Slide 1: Fiscal 2023 First Quarter Results
Fiscal 2023 First Quarter Results JUNE 6, 2023
Slide 2: Cautionary Statements
CAUTIONARY STATEMENTS Cautionary Note Regarding Forward-Looking Statements This presentation and accompanying discussion may include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, all st
Slide 3: Today's Presenters
TODAY’S PRESENTERS Steve LeClair Mark Witkowski Robyn Bradbury Chief Executive Officer Chief Financial Officer VP, Finance & Investor Relations © Core & Main All Rights Reserved. Confidential and Proprietary Information. 3
Slide 4: Business Update
Business Update STEVE LECLAIR
Slide 5: Business Update
BUSINESS UPDATE ✓ Q1’23 sales results in line with our expectations, reflecting a return to more typical seasonality for the first quarter ✓ Prices remain elevated against improving supply chains and gross margins outperformed our expectations, delivering a solid Adjusted EBITDA outcome for the quar
Slide 6: Driving Sustainable Growth Through M&A
DRIVING SUSTAINABLE GROWTH THROUGH M&A Landscape & Construction UPSCO Midwest Pipe Supply Foster Supply Supplies Status Closed March 2023 Closed April 2023 Closed April 2023 Signed May 2023 # of Locations 2 1 1 7 West Virginia, Kentucky & Geography Illinois New York Iowa Tennessee Pipe, Valves & Fit
Slide 7: Financial Results
Financial Results MARK WITKOWSKI
Slide 8: Q1 2023 Financial Results
Q1 2023 FINANCIAL RESULTS ($ in Millions) Net Sales Gross Profit $1,598 $1,574 (2%) $439 $421 +4% % Margin 26.3% +160 bps 27.9% Q1'22 Q1'23 Q1'22 Q1'23 Diluted Earnings Per Share Adjusted EBITDA(1) $0.50 $0.50 0% $219 $220 +1% % Margin(1) 13.7% +30 bps 14.0% Q1'22 Q1'23 Q1'22 Q1'23 (1) Adjusted EBIT
Slide 9: Cash Flow & Balance Sheet Highlights
CASH FLOW & BALANCE SHEET HIGHLIGHTS ($ in Millions) Operating Cash Flow Net Debt Leverage(2) 2.2x Q1’22 Q1’23 Y-o-Y $ 1.7x Adjusted EBITDA $219 $220 $1 Interest & Taxes(1) (40) (45) (5) Q1'22 Q1'23 Working Capital (215) (57) 158 Liquidity(3) ABL Facility Available Cash & Cash Equivalents Other (1)
Slide 10: Fiscal 2023 Guidance Update
FISCAL 2023 GUIDANCE UPDATE Key Metric FY23 Outlook Considerations ▪ Expect end market volumes to remain stable Net Sales $6,600 - $6,900 ($ in Millions) ▪ Sales outlook raised from last quarter due to recent acquisitions ̶ Expect ~4% sales growth from acquisitions that have signed or Adjusted EBITD
Slide 11: Appendix
Appendix
Slide 12: Core & Main at a Glance
CORE & MAIN AT A GLANCE Key Business Highlights Branch Footprint ▪ Leading U.S. specialty distributor focused on water, wastewater, storm Corporate HQ drainage and fire protection products, and related services ▪ Highly fragmented $40 billion addressable market(1) ▪ 1 of only 2 national distributors
Slide 13: Product & Service Offering
PRODUCT & SERVICE OFFERING © Core & Main All Rights Reserved. Confidential and Proprietary Information. 13
Slide 14: Our Approach to M&A
OUR APPROACH TO M&A Driving Sustainable Growth Through M&A… …By Leveraging Our Disciplined Approach October 2017 June 2018 July 2018 August 2018 January 2019 February 2019 ▪ Significant opportunity to fill existing geographies and product Maximize lines, or expand into new geographies and product li
Slide 15: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK Capital Allocation Framework For FY23 & Beyond Organic Growth & Expect future capital expenditures to average ~0.5% Operational Initiatives of net sales Normalized Maintain a robust M&A pipeline and a disciplined approach. Expect continued M&A focused on Operating Cash F
Slide 16: Our Investment Highlights
OUR INVESTMENT HIGHLIGHTS Leading position with size and scale in a fragmented market Strong value proposition & pivotal role in shaping our industry Multiple levers for organic growth Proven ability to execute and integrate acquisitions Differentiated service offerings enhanced by proprietary and m
Slide 17: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES Adjusted EBITDA & Adjusted EBITDA Margin ($ in Millions) Three Months Ended Twelve Months Ended April 30, 2023 May 1, 2022 April 30, 2023 May 1, 2022 Net income attributable to Core & Main, Inc. $ 86 $ 86 $ 366 $ 225 Plus: net income attributable to non-controllin
Slide 18: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES Net Debt Leverage ($ in Millions) As of April 30, 2023 May 1, 2022 Senior ABL Credit Facility due July 2026 $ 130 $ 57 Senior Term Loan due July 2028 1,474 1,489 Total Debt 1,604 1,546 Less: Cash & Cash Equivalents (1) (1) Net Debt $ 1,603 $ 1,545 Twelve Months En