Quanex Building Products Corporation · NYSE:NX
Quanex Building Products — Investor Presentation (June 2025)
42 slides from Quanex Building Products's investor presentation, June 2025
Slide 1: Investor Presentation June 2025
JUNE 2025 INVESTOR PRESENTATION
Slide 2: Safe Harbor Statement
SAFE HARBOR S TATEMENT Forward Looking Statements Statements that use the words “anticipate,” “estimated,” “expect,” “could,” “should,” “target,” “believe,” “will,” “might,” “predict,” “pursue” or similar words reflecting future expectations or beliefs are forward-looking statements. This presentati
Slide 3: A Part of Something Bigger
A PART OF SOMETHING BIGGER Our vison is to be an innovative and growth-focused manufacturing company that consistently exceeds the expectations of our customers, team members, shareholders and communities 3
Slide 4: Quanex At-A-Glance Proforma FY 2024
QUANEX AT- A-GLANCE PROFORMA FY 2024 REVENUE BREAKDOWN Global manufacturer with Diversified business Key Strengths and Market Leadership best-in-class team, extensive operating and reporting plant network and expansive through three segments • Core capabilities and broad ~ 40% ~ 60% operating footpr
Slide 5: Making Meaningful Progress Following Tyman Transaction Close
MAKING MEANINGFUL PROGRESS FOLLOWING T YMAN TRANSACTION CLOSE UPD ATE REALIZING MATERIAL, ACTIONABLE COST SYNERGIES PROGRESSING ON INTEGRATION ORIGINAL ESTIMATE Retaining the top talent from each of legacy Quanex ~$30M run-rate cost synergies across Corporate (~30%), and legacy Tyman to ensure a “be
Slide 6: Core Manufacturing Capabilities with Broad Applications
CORE MANUFACTURING C APABILITIES WITH BROAD APPLIC ATIONS RUBBER EXTRUSION VINYL EXTRUSION WOODWORK The continuous process in which rubber and PVC resin, impact modifiers, UV and heat Interior wood components are created other additive compounds are softened stabilizers as well as flow agents are me
Slide 7: Establishing a Global and Differentiated Manufacturing Footprint
ES TABLISHING A GLOBAL AND DIFFERENTIATED MANUFACTURING FOOTPRINT Extensive global DOMESTIC FOOTPRINT manufacturing capacity INTERNATIONAL FOOTPRINT (48 plants) Domestic footprint supports local customer base Ideally positioned to handle international supply chain disruptions Efficient design allowi
Slide 8: Secular Tailwinds Support a Strong Recovery in U.S. Residential Construction
SECULAR TAILWINDS SUPPORT A S TRONG RECOVERY IN U.S. RESIDENTIAL CONSTRUCTION Over a decade of under-building has left the U.S. housing market ROBUST LONG-TERM DEMAND structurally short of demand (estimated ~2.8mm homes1) FOR NEW CONSTRUCTION Low mortgage rate “lock-in” limits for sale inventory Rap
Slide 9: Broader Trends Expected to Drive Renovations with Gradual Recovery in New Construction
BROADER TRENDS EXPECTED TO DRIVE RENOVATIONS WITH A GRADUAL RECOVERY IN NEW CONSTRUCTION Lack of construction in recent years has led to a ~1.1mm1 home undersupply in the three largest Western European nations2 GRADUAL RECOVERY IN NEW CONSTRUCTION Growing immigration in Europe is driving up a demand
Slide 10: Taking Sustainability to the Next Level
TAKING SUS TAIN ABILIT Y TO THE NEXT LEVEL Accelerating trends provide significant opportunities to grow in both existing and adjacent markets EXPANDING OUR ENERGY-EFFICIENCY SOLUTIONS ENHANCING OUR SUSTAINABILITY INITIATIVES NEW PRODUCT DEVELOPMENT Developing sustainability strategy that sets new E
Slide 11: Capitalizing on Strong Foundation for Long-Term Growth & Success
CAPITALIZING ON S TRONG F OUNDATION F OR LONG -TERM GROW TH & SUCCESS PORTFOLIO OF SOLUTIONS BUILT TRACK RECORD OF SUCCESS FOUNDATION BUILT FOR GROWTH TO SUCCEED Executing on organic growth and Comprising products with strong brand integration, synergy realization recognition and serving 90+ countri
Slide 12: Strategic Roadmap for Growth and Value Creation
S TRATEGIC ROADMAP KEY ELEMENTS OF THE STRATEGY TYMAN CONTRIBUTION FOR GROW TH AND VALUE CREATION Acquisition-driven growth in • Enhances product offering and helps capture additional key areas market opportunities • Nearly doubles revenue to almost $2 Billion BOLD Drive innovation across business •
Slide 13: Exciting Path to Profitably Grow Revenue to ~$4B by 2029
E X C I T I N G P A T H T O P R O F I T A B LY G R O W R E V E N U E T O ~$ 4 B B Y 2 0 2 9 QUANEX EBITDA POTENTIAL (BY 2029) ($ IN MILLIONS) 800 Cost Synergy ~ 230 ~ 715 700 Integration Additional Opportunity Sales Upside 600 500 ~ 75 ~ 485 Scale M&A into ~ 25 400 ~ 40 a new vertical ~ 45 Medium-te
Slide 14: Operating Segments
OPERATING SEGMENTS HARDWARE SOLUTIONS EXTRUDED SOLUTIONS CUSTOM SOLUTIONS Insulating Glass Spacers Vinyl / PVC Extrusions Window & Door Hardware Wood Solutions Sealing Solutions & Misc. Specialty Products Custom Mixing Solutions Screens & Other Fenestration Components Access Solutions 14
Slide 15: Hardware Solutions At-A-Glance
HARDWARE SOLUTIONS Manufacturing Footprint AT-A-GLANCE NORTH AMERICA EUROPE OPERATING SEGMENT OVERVIEW • Manufactures window and door hardware, screens and other fenestration components • 22 manufacturing locations and 9 warehouses across the world # of Employees ASIA 3,453 ~ 50% REVENUE Hardware So
Slide 16: Window & Door Hardware
WINDOW & DOOR HARDWARE PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Produces a broad range of high quality and highly customized window and door components • Highly engineered products • Well established customer base with strong value impact for • Strong global manufacturing customers relative to
Slide 17: Screens & Other Fenestration Components
SCREENS & O THER FENES TRATION COMPONENT S PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT • Largest portfolio of screen • Well established customer solutions for windows and base patio doors, as well as • Highly integrated in customer exterior and patio door supply chain thresholds and other precisio
Slide 18: Extruded Solutions At-A-Glance
EXTRUDED Manufacturing Footprint SOLUTIONS NORTH AMERICA EUROPE AT-A-GLANCE OPERATING SEGMENT OVERVIEW • Manufactures IG spacer products, vinyl and composite profiles used in the assembly of windows, doors, conservatories and roofs, fencing, decking, piling and fascia trims • 11 manufacturing locati
Slide 19: Insulating Glass Spacers
INSULATING GLASS SPACERS PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Highly engineered products focused on improving window and patio door thermal and energy efficiency • Produces highly engineered IG • Diverse customer base spacer products using compound generating cross-selling extrusion and lam
Slide 20: Vinyl/PVC Extrusions
VINYL/PVC EXTRUSIONS PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Produces vinyl and composite profiles used in the assembly of windows, doors, conservatories and roofs, fencing, decking, piling and fascia trims • Strong relationships with the • Strong partnership with top door and window fabricato
Slide 21: Seals
SEALS PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Producer of high-performance sealing solutions • Trusted brands such as • Uses a wide range of materials and Q-LON and Foam-Tite have manufacturing technologies to serviced the industry for meet the fenestration market's over 60 years form, fit, an
Slide 22: Misc. Specialty Products
MISC. SPECIALT Y PRODUCT S PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT History of performance and product knowledge of specialty products • Solar panel sealant solutions improve • Products for Resale panel longevity and maximize power (PFR’s) consist of • Flashing tape is a self-adhesive tape seal
Slide 23: Custom Solutions At-A-Glance
CUSTOM SOLUTIONS Manufacturing Footprint AT-A-GLANCE NORTH AMERICA OPERATING SEGMENT OVERVIEW • Manufactures high-quality hardwood and engineered wood components, technically advanced rubber compounds and specialty access solutions • 15 manufacturing locations and 3 warehouses across North America E
Slide 24: Wood Solutions
WOOD SOLUTIONS PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Single-source supplier of high-quality hardwood and engineered wood cabinet doors and drawer fronts and components for kitchen and bath OEMs • Close working relationship • Opportunity to expand into adjacent with top cabinet OEMs wood prod
Slide 25: Custom Mixing Solutions
CUSTOM MIXING SOLUTIONS PRODUCT LINE OVERVIEW MANUFACTURING Technically advanced rubber compounding facility supporting niche and FOOTPRINT specialized products for the custom mixing market • Well-invested industrial plant with capacity • Highly customer centric available to support 40% growth witho
Slide 26: Access Solutions
ACCESS SOLUTIONS PRODUCT LINE OVERVIEW MANUFACTURING FOOTPRINT Industry leader in the design and manufacture of specialty access solutions for industrial, commercial and U.S. residential applications NORTH AMERICA • Manufacturing facilities across the U.S. • Commercial product range is highly and in
Slide 27: Financial Overview
FIN ANCIAL OVERVIEW 27
Slide 28: Building on Track Record of Growth and Margin Expansion
BUILDING ON TRACK RECORD OF GROW TH AND MARGIN EXPANSION REVENUE Step Change ADJUSTED EBITDA Step Change ($ in millions) Driven by Driven by Tyman Tyman Acquisition Acquisition ~$1,850 $300 ~$275 15% 14% Adjusted EBITDA ($ in millions) CAGR ~11% $250 12% 11% $200 $182.4 % Margin $1,278 9% $1,222 $15
Slide 29: Tariff Impact Fluid - Currently Limited & Manageable
T A R I F F I M P A C T F L U I D - C U R R E N T LY L I M I T E D & M A N A G E A B L E FY 2025E COGS EXPOSURE ACTIONS % of Total FY COGS China ~ 4% • Ongoing and continuous assessment of supply chain vulnerability Canada (1) ~ 3% • Exploring alternate supply sources Mexico (1) ~ 10% • Evaluating p
Slide 30: Enhancing Profitability in Second Half of Fiscal Year Due to Seasonality
ENHANCING PROFITABILIT Y IN SECOND HALF OF FISCAL YEAR DUE TO SEASONALIT Y FREE CASH FLOW ADJUSTED EBITDA (% of total) ($ in millions) 80% 140% 124.2% 118.4% 70% 67.5% 120% 64.1% 62.2% 60% 100% 55.4% 54.4% 78.7% 50% 45.6% 80% 44.6% 64.9% 61.8% 40% 37.8% 60% 35.9% 32.5% 35.1% 38.2% 30% 40% 21.3% 20%
Slide 31: Increasing Long-Term Total Shareholder Returns
INCREASING LONG -TERM TOTAL SHAREHOLDER RETURNS CAPITAL ALLOCATION PRIORITIES MAINTAIN HEALTHY, COMMITTED TO OPPORTUNISTICALLY DEPLOY CASH INTO AREAS RETURN EXCESS CASH YET EFFICIENT, PAYING DIVIDEND WITH THE HIGHEST RISK-ADJUSTED RETURNS AND TO SHAREHOLDERS BALANCE SHEET ABOVE MINIMUM HURDLE RATE N
Slide 32: Solid Track Record of Deleveraging Post-Acquisition
SOLID TRACK RECORD OF DELEVERAGING POS T -ACQUISITION NET LEVERAGE (1) Tyman Acquisition 4.0x 3.7x 3.5x 3.5x Liniar and 3.2x Woodcraft Acquisitions 3.0x 2.7x PF 2.7x (2) 2.5x 2.2x 2.3x 2.0x 2.0x ~1.0x - 1.5x NET LEVERAGE 1.5x 1.2x LMI Custom RATIO TARGET Mixing Acquisition 1.0x 0.8x 0.6x 0.6x 0.5x 0
Slide 33: Strong Free Cash Flow Generation Expected to Improve Further
S TRONG FREE CASH FLOW GENERATION EXPECTED TO IMPROVE FUR THER FREE CASH FLOW ($ in millions) ~$225+ $200 FREE CASH FLOW PRIORITIES • Debt paydown, stock $160 repurchases, strategic M&A, and dividend increases • Improve working capital $120 $109.7 profile of legacy Tyman ~$100 • Continue to focus on
Slide 34: Investing for Sustainable Long-Term Growth
INVES TING F OR SUS TAIN ABLE LONG -TERM GROW TH CAPEX ($ in millions) Project Specific $90 Growth Capex 30% ~23% $80 5-Yr Avg Capex % of EBITDA $82.5 25% $70 $60 20% $50 15% $40 $37.4 ~$37.1 $30 $33.1 10% $25.7 $24.0 $20 5% $10 $0 0% FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025E (1) Capex % of E
Slide 35: Growing Manufacturing Business with Core Capabilities & Broad Applications
GROWING MANUFACTURING BUSINESS WITH CORE C APABILITIES & BROAD APPLIC ATIONS A global market leader focused on niche products and aligned with top OEMs 01 across all product categories 02 Strong free cash flow generation, healthy balance sheet with significant liquidity Material science and process
Slide 36: Appendix
APPENDIX 36
Slide 37: GAAP/Non-GAAP Reconciliation (Unaudited)
G AAP/NON-G AAP RECONCILIATION (UN AUDITED) FY24, FY23, FY22, FY21 & FY20 Adjusted Net Income & Adjusted EBITDA to Net Income Twelve Months Ended Twelve Months Ended Twelve Months Ended Twelve Months Ended Twelve Months Ended Reconciliation of Adjusted Net Income October 31, 2024 October 31, 2023 Oc
Slide 38: GAAP/Non-GAAP Reconciliation (Unaudited)
G AAP/NON-G AAP RECONCILIATION (UN AUDITED) LTM Adjusted Net Income & Adjusted EBITDA to Net Income Three Months Ended Three Months Ended Three Months Ended Three Months Ended Total Reconciliation of Adjusted Net Income April 30, 2025 January 31, 2025 October 31, 2024 July 31, 2024 Net Net Net Net N
Slide 39: GAAP/Non-GAAP Reconciliation (Unaudited)
G AAP/NON-G AAP RECONCILIATION (UN AUDITED) Free Cash Flow ($ in thousands) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Fiscal 2020 Cash (used for) provided by operating activities ($3,657) $6,129 $45,089 $53,235 $100,796 Capital expenditures ($9,312) ($7,001) ($4,360) ($5,053) ($25,726) Free Cash Flow ($12,969
Slide 40: GAAP/Non-GAAP Reconciliation (Unaudited)
G AAP/NON-G AAP RECONCILIATION (UN AUDITED) Net Debt & Net Leverage The following table reconciles the Company's Net Debt which is defined as total debt principal of the Company plus finance lease obligations minus cash. FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 Capitalization ($ in thousand
Slide 41: Executive Compensation
EXECUTIVE COMPENSATION Aligned with Shareholders Performance-based compensation philosophy at target • Base salary targeted at market 50th percentile • Annual incentive award based on specific metrics • Long-term incentives as referenced below 2025 Annual Incentive Award • 25% weighting on Revenue g
Slide 42: Investor Contact
INVES TOR CONTACT Scott Zuehlke SVP, CFO & Treasurer 945 Bunker Hill Rd., Suite 900 Houston, TX 77024 (713) 877-5327 scott.zuehlke@quanex.com 42
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