Arcosa, Inc. · NYSE:ACA
Arcosa — Q2 2019 Earnings Presentation
19 slides from Arcosa's earnings presentation, Aug 2, 2019
Slide 1: Second Quarter Earnings 2019
Second Quarter Earnings 2019 August 2, 2019
Slide 2: How to Find Us
How to Find Us OUR WEBSITE NYSE TICKER www.arcosa.com ACA HEADQUARTERS INVESTOR CONTACT Arcosa, Inc. InvestorResources@arcosa.com 500 North Akard Street, Suite 400 Dallas, Tx 75201 2 / Moving Infrastructure Forward
Slide 3: Forward-Looking Statements
Forward-Looking Statements Some statements in this presentation, which are not historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about Arcosa’s estimates, expectations, beliefs, intenti
Slide 4: Arcosa Second Quarter 2019 Highlights
Arcosa Second Quarter 2019 Highlights Another quarter of solid growth, with Q2 revenue growth of 23% and Adjusted EBITDA growth of 38% Improved results from a combination of organic growth, ACG Materials acquisition, and operating margin improvements FY 2019 Adjusted EBITDA guidance raised from $215
Slide 5: Second Quarter 2019 Financial Results
Second Quarter 2019 Financial Results Strong year-over-year growth across key metrics Revenues Net Income Adjusted EBITDA $M’s $M’s $M’s +23% +41% +38% 434.1 31.8 64.2 353.0 22.6 46.4 Q2-18 Q2-19 Q2-18 Q2-19 Q2-18 Q2-19 Margin 13.1% 14.8% See Adjusted EBITDA reconciliation in Appendix. 5 / Moving In
Slide 6: Segment Results: Construction Products
Segment Results: Construction Products Second Quarter 2019 vs. Second Quarter 2018 Revenues Adjusted Segment EBITDA $M’s $M’s +38% +17% 115.6 26.5 22.4 22.7 83.9 Construction 22.8 Site Support 93.2 Aggregates & 61.1 Specialty Materials Q2-18 Q2-19 Q2-18 Q2-19 Margin 27.1% 22.9% See Adjusted Segment
Slide 7: Segment Results: Energy Equipment
Segment Results: Energy Equipment Second Quarter 2019 vs. Second Quarter 2018 Revenues Adjusted Segment EBITDA $M’s $M’s +15% +107% 204.3 32.3 178.4 53.3 Storage Tanks 45.4 & Other 15.6 Wind Towers & 133.0 151.0 Utility Structures Q2-18 Q2-19 Q2-18 Q2-19 Margin 8.7% 15.8% See Adjusted Segment EBITDA
Slide 8: Segment Results: Transportation Products
Segment Results: Transportation Products Second Quarter 2019 vs. Second Quarter 2018 Revenues Adjusted Segment EBITDA $M’s $M’s +26% +4% 115.3 16.0 16.7 91.5 Includes $1.3M of 66.1 Madisonville barge 42.9 facility startup costs Barges 48.6 49.2 Components Q2-18 Q2-19 Q2-18 Q2-19 Margin 17.5% 14.5% S
Slide 9: Raising 2019 Guidance
Raising 2019 Guidance 26% Adjusted EBITDA growth expected in 2019 at mid-point of updated guidance range Full Year Revenues ($M’s) Full Year Adjusted EBITDA ($M’s) +26% +22% 230-240 1,700 – 1,800 1,750 – 1,800 215-225 1,460 187 2018 Previous 2019 Updated 2019 2018 Previous 2019 Updated 2019 Guidance
Slide 10: Additional financial commentary
Additional financial commentary 1H Performance FY 2019 Guidance ▪ $39 million ▪ $70-80 million, including maintenance and growth Capital Expenditures projects ▪ $23 million of working capital ▪ Roughly working capital neutral for the year, as Working Capital reduction in 1H1 the ramp-up in barge bus
Slide 11: Construction Products Group: Market Outlook
Construction Products Group: Market Outlook ▪ Construction end markets remain healthy, with public and private spending showing continued strength. 2H projected to be stronger than 1H assuming more normalized weather ▪ ACG Materials acquisition continues to be a platform for growth; completed one sm
Slide 12: Energy Equipment: Market Outlook
Energy Equipment: Market Outlook ▪ Operationally, our second quarter results give us increased confidence in the momentum of our continuous improvement programs in Energy Equipment ▪ Bidding activity in utility structures remains healthy, with organic and acquisition opportunities to grow the busine
Slide 13: Transportation Products: Market Outlook
Transportation Products: Market Outlook ▪ $32M of barge orders in Q2 added to exceptional Q1 of $203M in orders; heavy flooding on the Mississippi River system has been the primary focus for barge operators in the last several months ▪ Healthy level of barge inquiries so far in Q3; lower steel price
Slide 14: ESG Update
ESG Update We recently completed a Materiality Assessment that identified ESG topics that will be integrated into our long term strategy Our Our People & Our Environment Products Communities Employee Health and Safety Energy Management Product Use and Quality Diversity Air Quality Talent Management
Slide 15: Long-Term Vision for Arcosa
Long-Term Vision for Arcosa Integrate Environmental, Social, Improve and Governance Reduce long-term returns initiatives (ESG) into our the complexity and on invested capital long-term strategy Grow cyclicality of the overall in attractive markets business where we can achieve sustainable competitiv
Slide 16: Appendix
Appendix
Slide 17: Reconciliation of Consolidated and Combined Adjusted EBITDA
Reconciliation of Consolidated and Combined Adjusted EBITDA ($’s in millions) Three Months Ended Six Months Ended Full Year (unaudited) June 30, June 30, 2019 Guidance 2019 2018 2019 2018 Low High Revenues $ 434.1 $ 353.0 $ 845.0 $ 707.4 $ 1,750.0 $ 1,800.0 Net income 31.8 22.6 59.5 44.8 100.0 111.0
Slide 18: Reconciliation of Adjusted Segment EBITDA
Reconciliation of Adjusted Segment EBITDA ($’s in millions) (unaudited) Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Construction Products Revenues $ 115.6 $ 83.9 $ 221.6 $ 154.1 Operating Profit 17.5 17.6 28.8 30.0 Add: Depreciation, depletion, and amortization expense
Slide 19: Reconciliation of Adjusted Net Income and Adjusted Diluted EPS
Reconciliation of Adjusted Net Income and Adjusted Diluted EPS (unaudited) Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (in millions) Net Income $ 31.8 $ 22.6 $ 59.5 $ 44.8 Impact of the fair value mark up of acquired inventory 0.2 — 1.6 — Tax impact — — (0.4) — Adjusted