Hayward Holdings, Inc. · NYSE:HAYW
Hayward — FY2022 Earnings Presentation
22 slides from Hayward's earnings presentation, Feb 28, 2023
Slide 1: Fourth Quarter and Full Year 2022 Earnings
FOURTH QUARTER AND FULL YEAR 2022 EARNINGS February 28, 2023 © 2022 Hayward Holdings, Inc.
Slide 2: Fourth Quarter and Full Year 2022 Earnings Call
FOURTH QUARTER AND FULL YEAR 2022 EARNINGS CALL KEVIN HOLLERAN President and Chief Executive Officer EIFION JONES Senior Vice President and Chief Financial Officer KEVIN MACZKA Vice President of Investor Relations NYSE: HAYW © 2022 Hayward Holdings, Inc.
Slide 3: Disclaimer
Disclaimer SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This presentation contains certain statements that are “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995 (the “Act”) and releases issued by the Securities and Exchange Commissio
Slide 4: Key Messages
Key Messages Delivered Q4 2022 results in line with expectations • Results reflect continued reduction of channel inventory days on hand Executed appropriate actions to optimize the cost structure and position for future growth • Achieved the planned structural SG&A spending reductions while maintai
Slide 5: Financial Overview
Financial Overview • Net sales of $259M • Adj. EBITDA1 of $53M Q4 2022 • Adj. EBITDA margin1 of 20.6% RESULTS REFLECT: • Adj. diluted EPS1 of $0.11 Positive price realization Traction with innovative new products Continued macroeconomic uncertainty Reducing distribution inventory levels • Ne
Slide 6: Business Update
Business Update U.S. underlying demand trends moderating End Consumer Demand Northern Europe negatively impacted by geopolitical events Structural share gain, notably in the strategically important U.S. sunbelt Market Share Technology leadership driving strong growth in “Totally Hayward” loy
Slide 7: Growth Strategy Leverages Competitive Moat
Growth Strategy Leverages Competitive Moat Technology Leadership Strong Brand / Installed Base Best-in-class products in key categories # 1 most trusted brand1, highest rated for quality Omni automation ecosystem Innovation Brand Large installed base $20M+ annual RD&E investment Loyalty 440 Patents
Slide 8: New Product Strategy
New Product Strategy Focused New Product Development (NPD) Strategy to Ensure “Must Win” Product Categories are Prioritized and Heavily IP-protected Pumps IoT Controls Water Quality Sanitization Lighting Heaters Most efficient variable Superior Omni® Safest, 3-in-1 (UV, Unique salt LED SmartPower ®
Slide 9: Fourth Quarter 2022 Financials
Fourth Quarter 2022 Financials NET SALES (27%) YOY NET SALES OF $259M Price +9%, acquisitions +2% Volume -36% (channel inventory movements), F/X -1% GROSS PROFIT MARGIN OF 42.3% GROSS PROFIT OF $109M Strong price realization to combat inflation Lower operating leverage on reduced production
Slide 10: Full Year 2022 Financials
Full Year 2022 Financials NET SALES (6%) YOY NET SALES OF $1.314B Price +13%, acquisitions +2% Volume -20% (channel inventory movements), F/X -2% GROSS PROFIT MARGIN OF 45.4% GROSS PROFIT OF $597M Strong price realization to combat inflation Lower operating leverage on reduced production vol
Slide 11: Q4 2022 Segment Overview
Q4 2022 Segment Overview North America Q4 2022 Europe and Rest of World Q4 2022 Net Sales $216.8M Net Sales $42.2M YoY Change (27.1%) YoY Change (23.1%) Gross Profit $93.1M Gross Profit $16.4M Gross Profit Margin 43.0% Gross Profit Margin 38.8% Adj. Segment Income1 $47.2M Adj. Segment Income1 $8.4M
Slide 12: FY 2022 Segment Overview
FY 2022 Segment Overview North America FY 2022 Europe and Rest of World FY 2022 Net Sales $1,108.9M Net Sales $205.3M YoY Change (4.5%) YoY Change (14.8%) Gross Profit $514.9M Gross Profit $82.2M Gross Profit Margin 46.4% Gross Profit Margin 40.0% Adj. Segment Income1 $340.8M Adj. Segment Income1 $4
Slide 13: Balance Sheet and Cash Flow Highlights
Balance Sheet and Cash Flow Highlights BALANCE SHEET ($M) CASH FLOW ($M) 12/31/2022 Q4 2022 FY 2022 Cash and cash equivalents $56 Cash flow from operating activities ($28) $116 Total debt principal $1,121 Less capex ($6) ($30) Term debt (2028 maturity)1 $1,098 Free cash flow4 ($34) $86 ABL revolver
Slide 14: Balanced Capital Allocation Priorities
Balanced Capital Allocation Priorities Innovative new product development, IoT digital leadership Growth Commercial programs, dealer conversions Investments Operational excellence, productivity, growth capex Funding strategic growth investments Pipeline of tuck-in opportunities to complement
Slide 15: FY 2023 Financial Outlook
FY 2023 Financial Outlook OUTLOOK REFLECTS: Challenging macro conditions in North America, more significant in Europe & Net sales down 18% to 22% Adjusted EBITDA1 of Rest of World $265M to $285M NAM aftermarket resilient Reversion to normal seasonality Free cash flow1 exceeding NAM new constru
Slide 16: Key Messages
Key Messages Delivered Q4 2022 results in line with our expectations Executed appropriate actions to optimize the cost structure and position for future growth Demonstrated operational excellence, agile manufacturing capabilities Continued to position as premier company in attractive industry Introd
Slide 17: Appendix: Non-GAAP Reconciliations
APPENDIX APPENDIX Non-GAAP Reconciliations Non-GAAP Reconciliations © 2022 Hayward Holdings, Inc.
Slide 18: Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation
Adjusted EBITDA & Adjusted EBITDA Margin Reconciliation APPENDIX © 2022 Hayward Holdings, Inc. 18
Slide 19: Adjusted net income and Adjusted EPS Reconciliation
Adjusted net income and Adjusted EPS Reconciliation APPENDIX © 2022 Hayward Holdings, Inc. 19
Slide 20: Adjusted Segment Income Reconciliations
Adjusted Segment Income Reconciliations APPENDIX © 2022 Hayward Holdings, Inc. 20
Slide 21: Adjusted Segment Income Reconciliations, continued
Adjusted Segment Income Reconciliations, continued APPENDIX © 2022 Hayward Holdings, Inc. 21
Slide 22: Thank You
THANK YOU © 2022 Hayward Holdings, Inc.