Armstrong World Industries Inc · NYSE:AWI
Armstrong World Industries — Q4 2019 Earnings Presentation
19 slides from Armstrong World Industries's earnings presentation, Feb 24, 2020
Slide 1: Earnings Call Presentation 4th Quarter 2019
Earnings Call Presentation 4th Quarter 2019 February 24, 2020 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, and in our other public documents and comments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Those s
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 2019
Consolidated Company Key Metrics-Fourth Quarter 2019 As reported EPS up 41%: $1.04 in 2019 and $0.74 in 2018 2018 includes $25M WAVE special dividend. Adj. Free Cash Flow +13% excluding special dividend. May not sum due to rounding Normalized(3) 2019 2018 Variance Net Sales $246.8599999999999 $0 $23
Slide 5: EBITDA Bridge - Fourth Quarter 2019 vs. PY
Adjusted EBITDA Bridge – Fourth Quarter 2019 vs. PY $3 $3 $1 $1 $1 $3 AUV growth coupled with manufacturing productivity and strong WAVE performance drive adjusted EBITDA up 14% Normalized(1) May not sum due to rounding
Slide 6: Bridge - Fourth Quarter 2019 vs. PY
Adjusted Free Cash Flow Bridge - Fourth Quarter 2019 vs. PY $4 Strong cash earnings growth impacted by WAVE special dividend in Q4 2018 $13 ($0) ($9) ($0) (2) NOTE: Adjustments include cash used or proceeds received for acquisitions and divestures, legacy environmental matters and litigation May not
Slide 7: Mineral Fiber Fourth Quarter Results
Average Unit Value (AUV) expanded 5% versus the prior year quarter Manufacturing gains driven by productivity WAVE equity earnings increased 18% driven by positive volume and mix Mineral Fiber Fourth Quarter Results EBITDA growth driven by Average Unit Value (AUV), productivity & WAVE Key Highlights
Slide 8: Architectural Specialties Fourth Quarter Results
Sales up 4% driven by M&A, partially offset due to unfavorable project timing and extended lead times from a third party supplier Adjusted EBITDA up 2% as sales gains were partially offset by higher manufacturing and SG&A investments Architectural Specialties Fourth Quarter Results Softer Q4 due to
Slide 9: Consolidated Company Key Metrics - FY 2019
Consolidated Company Key Metrics – FY 2019 As reported EPS up 34%: $4.88 in 2019 and $3.63 in 2018 2018 includes $25M WAVE special dividend. Adj. Free Cash Flow +16% excluding special dividend 2019 2018 Variance Net Sales $1,038.999999999999 $0 $975.3 6.4000000000000001E-2 Adj. EBITDA $403.149728999
Slide 10: EBITDA Bridge - FY 2019 vs. PY
Adjusted EBITDA Bridge – FY 2019 vs. PY $10 $31 ($2) $1 $5 $5 Strong price and mix drive adjusted EBITDA up 14% (1) May not sum due to rounding Normalized(1)
Slide 11: Bridge - FY 2019 vs. PY
Adjusted Free Cash Flow Bridge – FY 2019 vs. PY $30 Strong cash earnings impacted by WAVE special dividend received in Q4 2018 $1 $2 $2 ($2) $244 WAVE 2018 Special Dividend Impact ($25) NOTE: Adjustments include cash used or proceeds received for acquisitions and divestures, legacy environmental mat
Slide 12: 2020 Guidance
2020 Guidance $5.20 – $5.40 9% – 13% YoY Growth $4.78 Adjusted EBITDA Adjusted EPS* Adjusted Free Cash Flow Revenue $1,038 $403 $1,100 - $1,125 6% – 8% YoY Growth $435 - $445 YoY Margin Expansion Mineral Fiber up 5% - 7% Architectural Specialties** >15% 1-3 Acquisitions – incremental to guidance Ear
Slide 13: Appendix
Appendix = @mstrong WORLD INDUSTRIES
Slide 14: EBITDA Reconciliation
Adjusted EBITDA Reconciliation U.S. pension expense represents only the service cost related to the U.S. pension plan that is recorded within Operating Income. For all periods presented, we were not required and did not make cash contributions to our U.S. Retirement Income Plan. WAVE settled a porti
Slide 15: Diluted Earnings Per Share Reconciliation
Adjusted Diluted Earnings Per Share Reconciliation U.S. pension (credit) represents the entire actuarial net periodic pension (credit) cost 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 U.S.
Slide 16: Reconciliation
Adjusted Free Cash Flow Reconciliation Prior year Adjusted Free Cash Flow did not adjust for Environmental Recoveries in the first quarter. Includes related income tax payments. Adjusted free cash flow is defined as cash from operations and dividends received from the WAVE joint venture, less expend
Slide 17: Segment Reported Operating Income (Loss) to Adjusted EBITDA
Segment Reported Operating Income (Loss) to Adjusted EBITDA U.S. pension expense represents only the service cost related to the U.S. pension plan that is recorded within Operating Income. For all periods presented, we were not required and did not make cash contributions to our U.S. Retirement Inco
Slide 18: Net Sales & EBITDA - Guidance Reconciliation
Net Sales & EBITDA – Guidance Reconciliation Net Sales Adjusted EBITDA For the Year Ending December 31, 2020 Low to High Reported Net Sales $1,100 to $1,125 For the Year Ending December 31, 2020 Low to High Net income $267.5 to $275 Add: Interest expense 30 30 Add: Income tax expense 82.5 85 (Less):
Slide 19: EPS & Free Cash Flow - Guidance Reconciliation
Adjusted EPS & Free Cash Flow – Guidance Reconciliation Adjusted Diluted Earnings Per Share Adjusted Free Cash Flow Adjusted EPS guidance for 2020 is calculated based on an estimated effective tax rate of 25% and on 48 million of diluted shares outstanding. U.S. pension (credit) represents only the
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