Armstrong World Industries Inc · NYSE:AWI
Armstrong World Industries — Q4 2020 Earnings Presentation
20 slides from Armstrong World Industries's earnings presentation, Feb 23, 2021
Slide 1: Earnings Call Presentation 4th Quarter 2020
Earnings Call Presentation 4th Quarter 2020 February 23, 2021 Exhibit 99.2
Slide 2: Safe Harbor Statement
Our disclosures in this presentation, including without limitation, those relating to future financial results market conditions and guidance, the impacts of COVID-19 on our business, and in our other public documents and comments contain forward-looking statements within the meaning of the Private
Slide 3: Basis of Presentation
All figures throughout the presentation are in $ millions unless otherwise noted. Figures may not add due to rounding. When reporting our financial results within this presentation, we make several adjustments. Management uses these non-GAAP measures in managing the business and believes the adjustm
Slide 4: Consolidated Company Key Metrics - Fourth Quarter 2020
Consolidated Company Key Metrics-Fourth Quarter 2020 As reported EPS: $0.72 in 2020 and $1.04 in 2019. As defined by the terms of our credit agreement 2020 2019 Variance Net Sales $238.7 $0 $246.9 -3.3211826650465848E-2 Adj. EBITDA $72.599999999999994 $0 $89.5 $0 -0.18882681564245818 % of Sales 0.30
Slide 5: Mineral Fiber Fourth Quarter Results
COVID-19 impacts demand Strength in Big Box channel and weakness in major metro areas drive lower mix Manufacturing gains driven by productivity Sales continued to improve sequentially in the quarter Mineral Fiber Fourth Quarter Results Sales improving sequentially as major metro areas reopen Key Hi
Slide 6: Architectural Specialties Fourth Quarter Results
Sales up 13% as acquisitions of Turf Design, Moz Designs, and Arktura LLC add $11 million AS Organic* Sales down (9%) or ($5) million Architectural Specialties Fourth Quarter Results Acquisitions offset COVID headwinds Key Highlights Q1 Q2 Q3 Q4 Current Quarter Comments 2019 Adjusted EBITDA $10 $12
Slide 7: EBITDA Bridge - Fourth Quarter 2020 vs. PY
Adjusted EBITDA Bridge – Fourth Quarter 2020 vs. PY ($0) ($7) $2 ($11) $2 ($3) Mix fall through driven by growth in big box channel…Sequential improvement within quarter…SG&A change driven by growth investments and acquisitions Normalized(1) May not sum due to rounding (2) Excludes Depreciation 2020
Slide 8: Free Cash Flow Bridge - Fourth Quarter 2020 vs. PY
Adjusted Free Cash Flow Bridge - Fourth Quarter 2020 vs. PY $5 Cash earnings decline driven by volume declines due to Covid-19 ($8) $0 ($0) (2) NOTE: Adjustments include cash used or proceeds received for acquisitions and divestures, legacy environmental matters and litigation May not sum due to rou
Slide 9: Consolidated Company Key Metrics - FY 2020
Consolidated Company Key Metrics – FY 2020 As reported EPS: ($1.76) in 2020 and $4.88 in 2019. 2020 2019 Variance Net Sales $936.9 $0 $1,038.999999999999 -9.7485791349580908E-2 Adj. EBITDA $329.9 $0 $403.1 $0 -0.18159265690895565 % of Sales 0.35211868929448181 0.3883055582313843 -360 Adj. Earnings P
Slide 10: EBITDA Bridge - FY 2020 vs. PY
Adjusted EBITDA Bridge – FY 2020 vs. PY ($51) ($21) $10 ($4) $10 ($18) Balancing short-term cost containment with long-term growth drivers 2020 Acquisitions - 14 - - (3) (6) - 5 May not sum due to rounding (2) Excludes Depreciation Normalized(1)
Slide 11: Free Cash Flow Bridge - FY 2020 vs. PY
Adjusted Free Cash Flow Bridge – FY 2020 vs. PY ($47) Cash earnings decline driven by volume declines due to Covid-19 $16 $9 ($17) $7
Slide 12: 2021 Guidance
2021 Guidance $3.80 – $4.00 5% – 10% YoY $3.63 Adjusted EBITDA Adjusted EPS* Adjusted Free Cash Flow Revenue $937 $330 $1,030 - $1,060 10% – 13% YoY $360 - $372 9% – 13% YoY MF AUV 4%-6%, positive like-for-like pricing & mix Growth Initiatives, primarily kanopi & Healthy Spaces, drive MF volume up 0
Slide 13: 2021 Sales Guidance
2021 Sales Guidance COVID-19 impacts create unusual seasonality in 2021 Q2 2020 key city shutdowns drives changes to historic seasonality
Slide 14: Appendix
Appendix = @mstrong WORLD INDUSTRIES
Slide 15: EBITDA Reconciliation
Adjusted EBITDA Reconciliation RIP expense represents only the plan service cost that is recorded within Operating Income. For all periods presented, we were not required and did not make cash contributions to our RIP. WAVE settled a portion of their pension plan, resulting in a non-cash accounting
Slide 16: Diluted Earnings Per Share Reconciliation
Adjusted Diluted Earnings Per Share Reconciliation RIP expense (credit) represents the entire actuarial net periodic pension expense (credit) recorded as a component of earnings from continuing operations. For all periods presented, we were not required and did not make cash contributions to our RIP
Slide 17: Free Cash Flow Reconciliation
Adjusted Free Cash(1) Flow Reconciliation Adjusted free cash flow is defined as cash from operations and dividends received from the WAVE joint venture, less expenditures for property and equipment, and is adjusted to remove the impact of cash used or proceeds received for acquisitions and divestitu
Slide 18: Segment Reported Operating Income (Loss) to Adjusted EBITDA
Segment Reported Operating Income (Loss) to Adjusted EBITDA RIP expense represents only the plan service cost related to the RIP that is recorded within Operating Income. For all periods presented, we were not required and did not make cash contributions to our RIP. Donation to the AWI Foundation. M
Slide 19: EBITDA - Guidance Reconciliation
EBITDA – Guidance Reconciliation Adjusted EBITDA RIP credit represents the actuarial net periodic benefit expected to be recorded as a component of other non-operating income. We do not expect to be and do not plan to make cash contributions to our U.S. Retirement Income Plan based on guidelines est
Slide 20: EPS - Guidance Reconciliation
Adjusted EPS & Free Cash Flow – Guidance Reconciliation Adjusted Diluted Earnings Per Share Adjusted Free Cash Flow Adjusted EPS guidance for 2021 is calculated based on an adjusted effective tax rate of 25% and based on ~48 million of diluted shares outstanding. RIP credit represents the actuarial
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