Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 Earnings Presentation October 29, 2024
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements that reflect our views about our future performance and constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,”
Slide 3: Agenda
Agenda 1 Summary of Results Keith Allman 2 Financial / Operations Review Rick Westenberg 3 Q&A Keith Allman Rick Westenberg 3
Slide 4: Summary of Results
1 Summary of Results Keith Allman 4
Slide 5: Q3 2024 Review
Q3 2024 Review Revenue in line with prior year Grew adjusted gross margin 90 bps to 36.7% Achieved adjusted operating profit margin of 18.2% Delivered adjusted EPS growth of 8% to $1.08 per share Repurchased 2.5 million shares for $192 million Updating anticipated full year adjusted EPS range to $4.
Slide 6: Financial / Operations Review
2 Financial / Operations Review Rick Westenberg
Slide 7: Third Quarter Highlights
Masco Corporation Third Quarter Highlights ($ in Millions) Quarter 2024 • Total company sales were in line with prior year, and increased 1% excluding the impact of currency Revenue $1,983 Y-O-Y Change 0% • In local currency, North American sales were in line with prior year Operating Profit* $360 •
Slide 8: Plumbing Products Segment
Plumbing Products Segment Quarter Highlights Third ($ in Millions) Quarter 2024 • Total segment sales increased 2% • Currency had a minimal impact and acquisitions Revenue $1,219 increased sales by 1% Y-O-Y Change 2% • In local currency, North American sales increased Operating Profit* $242 2%, or 1
Slide 9: Decorative Architectural Products Segment
Decorative Architectural Products Segment Third Quarter Highlights ($ in Millions) Quarter 2024 • Total segment sales decreased 3%, or 1% excluding the impacts of currency and Revenue $764 divestitures Y-O-Y Change (3)% • Sales of paints and other coating products Operating Profit* $138 decreased lo
Slide 10: Strong Balance Sheet
Strong Balance Sheet Masco Corporation Balance Sheet Metrics as of 9/30/2024 Cash and cash investments $646M Revolver availability $1,000M Total liquidity $1,646M Gross debt to EBITDA1 2.0x Working capital as a % of sales1 16.4% 1. See Appendix for reconciliation. 10
Slide 11: Full Year 2024 Outlook
Full Year 2024 Outlook 2024 Forecasted Adjusted EPS $4.05 - $4.15, updated from previous guide of $4.05 - $4.20 11
Slide 12: Q&A
3 Q&A Keith Allman Rick Westenberg 12
Slide 13: Appendix
ra O Cc © oF oY L MASCO
Slide 14: 2024 Assumptions
2024 Assumptions Item Assumption Tax rate 24.5% General corporate expense ~$100m Interest and other expense1 ~$115m Capital expenditures (includes maintenance capex of ~$75m) ~$180m Depreciation and amortization2 ~$150m Unfavorable foreign currency translation impact ~$10m to sales3 Share repurchase
Slide 15: Capital Allocation Strategy
Capital Allocation Strategy Balanced Approach to Continue to Drive Shareholder Value 1 Reinvest in the Business • • Capex: 2-2.5% of sales Working capital: ~16% of sales in 2024 2 Maintain investment grade credit rating • Target gross debt to EBITDA below 2.5x 3 Maintain relevant dividend • • Curren
Slide 16: Long-Term Outlook
Low ticket, repair and remodel products provide LONG-TERM OUTLOOK growth and stability through an economic cycle Average annual sales growth • Organic: ~3-5% • Acquisition: ~1-3% Operating profit margin Market-leading brands, • Expand margins through cost productivity history of innovation, and volu
Slide 17: 2023 Segment Mix
2023 Segment Mix* Total Geographic Business Segment 2023 Revenue R&R% vs. NC NA% v. Int’l Revenue Split Plumbing Products $4.8B 82% 67% Decorative Architectural $3.1B 97% 100% Products Total Company $8.0B 88% 80% NA = % of sales within R&R = % of sales to repair North America and remodel channels NC
Slide 18: 2023 Channel Mix
2023 Channel Mix* 2023 Channel Mix as a Percentage of Sales Plumbing Decorative Architectural Total Channel Products Products Masco Retail 19% 86% 46% Wholesale/trade/dealer 53% 10% 35% E-commerce 17% 4% 12% Specialty Dealer/Other 11% 0% 7% *Based on Company estimates 18
Slide 19: Profit Reconciliations – Third Quarter
Profit Reconciliations – Third Quarter ($ in Millions) Q3 2024 Q3 2023 Net sales $ 1,983 $ 1,979 Gross profit, as reported $ 725 $ 744 Rationalization charges 2 5 Insurance settlement (1) — (40) Gross profit, as adjusted $ 727 $ 709 Gross margin, as reported 36.6 % 37.6 % Gross margin, as adjusted 3
Slide 20: EPS Reconciliation – Third Quarter
EPS Reconciliation – Third Quarter ($ in Millions, Except per Common Share Data) Q3 2024 Q3 2023 Income before income taxes, as reported $ 248 $ 346 Rationalization charges 2 5 Loss on sale of business (1) 81 — Realized (gains) from private equity funds (1) — Loss from equity investments, net — 1 In
Slide 21: EPS Outlook Reconciliation
EPS Outlook Reconciliation 2024 Low End High End Net income per common share $ 3.74 $ 3.84 Rationalization charges 0.03 0.03 Loss on sale of business (1) 0.28 0.28 Net income per common share, as adjusted $ 4.05 $ 4.15 (1) Represents the preliminary loss from the sale of our Kichler Lighting busines
Slide 22: Gross Debt to EBITDA Reconciliation
Gross Debt to EBITDA Reconciliation September 30, 2024 Debt $ 2,948 TTM September 30, 2024 Operating profit, as reported $ 1,320 Rationalization charges 17 Impairment charge for other intangible assets 15 Operating profit, as adjusted $ 1,353 Depreciation and amortization 155 EBITDA, as adjusted $ 1
Slide 23: Working Capital as a % of Sales
Working Capital as a % of Sales As Reported (in Millions) September 30, 2024 Receivables $ 1,152 Inventories 1,013 Less: Accounts payable (874) Working Capital $ 1,291 Net sales (last 12 months) $ 7,882 Working capital as a % of sales 16.4 % Amounts may not add due to rounding. 23