Hayward Holdings, Inc. · NYSE:HAYW
Hayward — Q1 2023 Earnings Presentation
20 slides from Hayward's earnings presentation, May 4, 2023
Slide 1: First Quarter 2023 Earnings
FIRST QUARTER 2023 EARNINGS May 4, 2023 © 2023 Hayward Holdings, Inc.
Slide 2: First Quarter 2023 Earnings Call
FIRST QUARTER 2023 EARNINGS CALL KEVIN HOLLERAN President and Chief Executive Officer EIFION JONES Senior Vice President and Chief Financial Officer KEVIN MACZKA Vice President of Investor Relations NYSE: HAYW © 2023 Hayward Holdings, Inc. 2
Slide 3: Disclaimer
Disclaimer SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This presentation contains certain statements that are “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995 (the “Act”) and releases issued by the Securities and Exchange Commissio
Slide 4: Key Messages
Key Messages Delivered Q1 2023 results in line with expectations Executed well in a challenging operating environment, including unfavorable weather Expanded gross profit margins, maintaining structural margin profile at reduced volume levels Reaffirmed full year 2023 guidance © 2023 Hayward Holding
Slide 5: Financial Overview
Financial Overview RESULTS REFLECT: ▪ Positive price realization • Net sales of $210M ▪ Reduced distribution inventory levels • Gross profit margin of 46.6% ▪ Difficult macroeconomic conditions Q1 2023 • Adj. EBITDA1 of $45M ▪ Unfavorable weather • Adj. EBITDA margin1 of 21.4% • Adj. diluted EPS1 of
Slide 6: Business Update
Business Update ✓ Structural share gain, notably in the strategically important U.S. sunbelt markets Market Share ✓ Technology leadership driving continued growth in “Totally Hayward” loyalty program ✓ Further moderation in new construction in North America, impacted by unfavorable weather End Consu
Slide 7: New Product Launches
New Product Launches SmartPower: TracVac Suction Cleaner: ✓ Patented, low voltage 4-zone LED light ✓ Superior coverage, floor to wall transformer ✓ Large tracks to navigate the toughest surfaces ✓ Simple, affordable solution to incentivize ✓ Fast, compact design for the best clean installation of mu
Slide 8: Attractive Long-Term Growth Dynamics
Attractive Long-Term Growth Dynamics Secular Tailwinds Industry Drivers Competitive Advantages ✓ Healthy outdoor living ✓ Growing, aging installed base ✓ Strong brand and installed base ✓ Sunbelt migration ✓ Predictable, non-discretionary ✓ Technology leadership aftermarket spending ✓ “Smart home” I
Slide 9: First Quarter 2023 Financials
First Quarter 2023 Financials NET SALES (49%) YoY NET SALES OF $210M ▪ Price +5%, acquisitions +1% ▪ Volume -54% (channel inventory movements, reduced sell through), F/X -1% GROSS PROFIT MARGIN OF 46.6% GROSS PROFIT OF $98M ▪ Gross margin increased 20 bps YoY, 430 bps sequentially despite lower volu
Slide 10: First Quarter 2023 Segment Overview
First Quarter 2023 Segment Overview North America Europe and Rest of World Net Sales $162.7M Net Sales $47.4M YoY Change (53.0%) YoY Change (26.1%) Gross Profit $79.0M Gross Profit $18.9M Gross Profit Margin 48.6% Gross Profit Margin 39.8% Adj. Segment Income1 $39.3M Adj. Segment Income1 $10.1M Adj.
Slide 11: Balance Sheet and Cash Flow Highlights
Balance Sheet and Cash Flow Highlights BALANCE SHEET ($M) CASH FLOW ($M) 4/1/2023 Q1 2023 Cash and cash equivalents $41 Cash flow from operating activities ($91) $600M fixed rate, remainder variable Total debt principal $1,204 Less capex ($6) Term debt (2028 maturity)1 $1,107 Free cash flow4 ($97) A
Slide 12: Balanced Capital Allocation Priorities
Balanced Capital Allocation Priorities ✓ Innovative new product development, IoT digital leadership Growth ✓ Commercial programs, dealer conversions Investments ✓ Operational excellence, productivity, growth capex Funding strategic growth investments ✓ Pipeline of tuck-in opportunities to complement
Slide 13: Unchanged FY 2023 Financial Outlook
Unchanged FY 2023 Financial Outlook OUTLOOK REFLECTS: ▪ Challenging global macro conditions Adjusted EBITDA1 of Net sales down 18% to 22% ▪ NAM aftermarket resilient, new construction $265M to $285M down ~25-30%, remodel / upgrade down Reversion to more normal ~20-25% Free cash flow1 exceeding seaso
Slide 14: Key Messages
Key Messages Delivered Q1 2023 results in line with expectations Executed well in a challenging operating environment, including unfavorable weather Expanded gross profit margins, maintaining structural margin profile at reduced volume levels Reaffirmed full year 2023 guidance © 2023 Hayward Holding
Slide 15: Appendix: Non-GAAP Reconciliations
APPENDIX APPENDIX Non-GAAP Reconciliations Non-GAAP Reconciliations © 2023 Hayward Holdings, Inc.
Slide 16: Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation
Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation APPENDIX © 2023 Hayward Holdings, Inc. 16
Slide 17: Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation
Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation APPENDIX © 2023 Hayward Holdings, Inc. 17
Slide 18: Adjusted Net Income and Adjusted EPS Reconciliation
Adjusted Net Income and Adjusted EPS Reconciliation APPENDIX © 2023 Hayward Holdings, Inc. 18
Slide 19: Adjusted Segment Income Reconciliations
Adjusted Segment Income Reconciliations APPENDIX © 2023 Hayward Holdings, Inc. 19
Slide 20: Thank You
THANK YOU © 2023 Hayward Holdings, Inc.