Mueller Water Products · NYSE:MWA
Mueller Water Products — Q2 2021 Earnings Presentation
25 slides from Mueller Water Products's earnings presentation, May 4, 2021
Slide 1: Where Intelligence Meets Infrastructure
Where Intelligence Meets Infrastructure® Earnings Conference Call For The Second Quarter Ended March 31, 2021 May 4, 2021 These slides are not intended to be a stand-alone presentation, but are for use in conjunction with the earnings call
Slide 2: NON-GAAP Financial Measures
NON-GAAP Financial Measures In an effort to provide investors with additional information regarding the Company’s results as determined by accounting principles generally accepted in the United States (“GAAP”), the Company also provides non-GAAP information that management believes is useful to inve
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements that address activities, events or developments that the Company intends, expects, plans
Slide 4: Second Quarter Highlights
Second Quarter Highlights • Delivered solid second quarter performance despite continuing and new challenges from COVID-19 and inflation • Consolidated net sales exceeded our expectations as we reported a 3.8% increase in quarter − Increased net sales 1.5%, excluding $6.0 million benefit from the el
Slide 5: Consolidated GAAP Results
Consolidated GAAP Results • Net sales of $267.5M increased $9.8M, or 3.8%, driven by the benefit of eliminating the one-month reporting lag, higher pricing and increased volumes at Technologies Second Quarter 2021 2020 • Gross profit was $88.4M with a gross margin of 33.0%, and gross Net sales $ 267
Slide 6: Consolidated Non-GAAP Results
Consolidated Non-GAAP Results • Generated $35.2M of adjusted operating income compared to the prior year Second Quarter 2021 2020 • Higher costs associated with inflation and Adj. operating income $ 35.2 $ 36.7 higher SG&A expenses were partially offset by benefits from favorable manufacturing Adj.
Slide 7: Infrastructure Results
Infrastructure Results • Net sales of $246.9M increased $7.0M, or 2.9%, primarily due to eliminating the one-month Second Quarter 2021 2020 reporting lag and higher pricing Net sales $ 246.9 $ 239.9 • Adjusted operating income of $52.9M increased $2.2M, or 4.3%, primarily due to favorable Adj. opera
Slide 8: Technologies Results
Technologies Results • Net sales of $20.6M increased $2.8M, or 15.7%, primarily due to increased volumes and Second Quarter 2021 2020 higher pricing Net sales $ 20.6 $ 17.8 • Adjusted operating loss of $4.6M was flat in the quarter as higher sales were offset by Adj. operating income / (loss) $ (4.6
Slide 9: Free Cash Flow
Free Cash Flow $80.0 • Net cash provided by operating activities for six $63.2 month period improved $66.2M to $63.2M, $60.0 $31.1 primarily driven by improvements in working $40.0 capital management $37.3 $20.0 $32.1 • First quarter 2020 included the $22.0M $ in millions ($3.0) payment associated w
Slide 10: Strong Balance Sheet and Ample Liquidity
Strong Balance Sheet and Ample Liquidity Well-Prepared to Deal with Ongoing Challenges from Pandemic • Moody’s: Ba2 Corporate Rating, Ba3 Notes Rating, Stable Outlook Credit Rating • S&P: BB Corporate and Notes Ratings, Stable Outlook Debt Maturities • $450M of 5.5% Senior Unsecured Notes (matures J
Slide 11: Key Strategies, End Markets, and Full-Year Fiscal 2021 Outlook
Key Strategies, End Markets, and Full-Year Fiscal 2021 Outlook
Slide 12: Key Strategies
Key Strategies • Raw material inflation accelerated during the second quarter impacting gross margins • Due to the magnitude of the inflationary increases, especially raw materials, and the lag between pricing actions and realization, experienced unfavorable price-cost impact during the quarter • Ta
Slide 13: End Market Update
End Market Update • End markets improved during the quarter as municipal spending continues to recover from the pandemic and residential construction continues to see strong demand for single-family homes • For the first half of the year, increased consolidated net sales 6.1%, excluding the one-mont
Slide 14: Full-Year Fiscal 2021 Outlook
Full-Year Fiscal 2021 Outlook* • Demand remained strong throughout the second quarter and we finished the quarter with an all-time high backlog • For 2021, continue to expect that strong growth in the residential construction end market will more than offset any temporary delays in the project-relat
Slide 15: Remain Focused on Executing Key Strategies to Grow and Enhance Our Business
Remain Focused on Executing Key Strategies to Grow and Enhance Our Business Where Intelligence Meets Infrastructure® Mueller is committed to manufacturing innovative products and creating smart solutions that will solve future challenges, whether it's at the source, at the plant, below the ground, o
Slide 16: Q&A
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Slide 17: Supplemental Data
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Slide 18: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended March 31, 2021 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales (1) $ 246.9 $ 20.6 $ — $ 267.5 Gross profit $ 86.3 $ 2.1 $ — $ 88.4 Sellin
Slide 19: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended March 31, 2021 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 20.9 Income tax expense (4) 7.2 Interest expense, net(4) 6.1 Pension be
Slide 20: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended March 31, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales (1) $ 239.9 $ 17.8 $ — $ 257.7 Gross profit (1) $ 84.1 $ 1.9 $ — $ 86.0 Se
Slide 21: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended March 31, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 23.8 Income tax expense (2) 6.8 Interest expense, net (2) 6.0 Pension b
Slide 22: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Six months ended March 31, 2021 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales (1) $ 462.8 $ 42.1 $ — $ 504.9 Gross profit $ 160.0 $ 6.8 $ — $ 166.8 S
Slide 23: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Six months ended March 31, 2021 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 37.6 Income tax expense (4) 13.0 Interest expense, net (4) 12.2 Pens
Slide 24: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Six months ended March 31, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales (1) $ 432.2 $ 38.1 $ — $ 470.3 Gross profit (1) $ 152.1 $ 6.5 $ — $ 158
Slide 25: Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Six months ended March 31, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 34.1 Income tax expense (2) 9.9 Interest expense, net (2) 13.4 Walte
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