Advanced Drainage Systems, Inc. · NYSE:WMS
Advanced Drainage Systems — Q4 FY2019 Earnings Presentation
16 slides from Advanced Drainage Systems's earnings presentation, May 23, 2019
Slide 1: Advanced Drainage Systems Q4 and Fiscal 2019 Financial Results
Advanced Drainage Systems Q4 and Fiscal 2019 Financial Results
Slide 2: Management Presenters
Management Presenters Scott Barbour President and Chief Executive Officer Scott Cottrill Executive Vice President, Chief Financial Officer Mike Higgins Vice President, Corporate Strategy & Investor Relations
Slide 3: Forward Looking Statements and Non-GAAP Financial Metrics
Forward Looking Statements and Non-GAAP Financial Metrics Certain statements in this presentation may be deemed to be forward-looking statements. Such statements include, but are not limited to, statements regarding the anticipated timing for the issuance of additional historic and future financial
Slide 4: Q4 FY 2019 Highlights
Q4 FY 2019 Highlights Domestic construction market sales grew 6% despite record rainfall in the quarter, in led by non-residential and residential construction. Domestic construction market sales finished the year strong with 13% overall growth this quarter driven by all three end markets. Adjusted
Slide 5: Fiscal 2019 Financial Results
Fiscal 2019 Financial Results Key Metric Low High Fiscal 2019 Net Sales (in Millions) $1,375 $1,425 $1,385 Adj. EBITDA (in Millions) $225 $240 $232 Adj. EBITDA Margin 16.4% 16.8% 16.8% Fiscal 2019 Guidance Results
Slide 6: Fiscal 2019 Domestic End Market Performance
Fiscal 2019 Domestic End Market Performance End Market % of Domestic Sales Market Performance ADS Sales Non-Residential Construction +3% +8% Residential Construction +1% +11% Infrastructure Construction +6% (4%) Agriculture (22%) (22%) 60% 23% 9% 8% ADS construction market sales outperformed overall
Slide 7: Capital Deployment Priorities
Capital Deployment Priorities CapEx Investing in Strategic Priorities FY20 Priorities Growth: Capacity for high growth products & regions Productivity & Efficiency: Continuous Improvement, Automation, Recycling Strategic Acquisitions ROIC > WACC Evaluating companies, product lines and potential rela
Slide 8: Q4 Fiscal 2019 Financial Performance
Q4 Fiscal 2019 Financial Performance +270 bps (USD, in millions) +8.8% Domestic Markets + Construction +13% + Non-Residential +12% + Residential +17% + Infrastructure +6% − Agriculture - 16% + Pipe +12% + Allied +9% By Geography + Domestic +11% − International - 12% By Application + Pipe +9% + Allie
Slide 9: Fiscal 2019 Financial Performance
Fiscal 2019 Financial Performance +100 bps (USD, in millions) +4.1% Domestic Markets + Construction +7% + Non-Residential +8% + Residential +11% − Infrastructure - 4% − Agriculture - 22% + Pipe +3% + Allied +8% By Geography + Domestic +4% + International +3% By Application + Pipe +3% + Allied +7% $2
Slide 10: Free Cash Flow
Free Cash Flow % of Sales 2.7% 3.5% All figures in USD, mm Net Debt³ 1Operating Cash Flow less CapEx 2Inventory, Trade Receivables, Accounts Payable 3Total debt less cash (includes capital leases) 1.4x Leverage 1.9x Leverage CapEx Working Capital² FY 2019 FY 2018 ∆ Adjusted EBITDA $232 $210 $22 Work
Slide 11: Fiscal 2020 Financial Outlook
Fiscal 2020 Financial Outlook Key Metric FY 2019 FY 2020 Y-o-Y Change Net Sales (in Millions) $1,385 $1,425 - $1,475 Up 3% to 6% Adj. EBITDA (in Millions) $232 $245 - $265 Up 6% to 14% Adj. EBITDA Margin 16.8% 17.2% - 18.0% +40 to +120 basis points Fiscal 2020 Expectations
Slide 12: Key Net Sales Drivers – Market Outlook
Key Net Sales Drivers – Market Outlook Market FY2020 Outlook Comments Domestic Construction End Markets Growth driven by market conversion and continued strength in the domestic construction markets. Agriculture End Market Improvement driven by organizational changes and investments in Ag business.
Slide 13: Q&A Session
Q&A Session
Slide 14: Closing Remarks
Closing Remarks Domestic construction market sales grew 6% despite record rainfall in the quarter, in led by non-residential and residential construction. Steady demand in core domestic construction markets expected to continue in fiscal 2020. Positioned for continued above-market growth in fiscal 2
Slide 15: Appendix
Appendix
Slide 16: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Three Months Ended Fiscal Year Ended March 31, March 31, (Amounts in thousands) 2019 2018 2019 2018 Net income $1,893 $-4,856 $81,466 $64,792 Depreciation and amortization 18,988 19,210 71,900 75,003 Interest expense 4,590 2,642 18,618 15,262 Income tax expense (benefi
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