Arcosa, Inc. · NYSE:ACA
Arcosa — Investor Presentation (March 2021)
34 slides from Arcosa's investor presentation, Mar 9, 2021
Slide 1: Investor Presentation March 2021
Investor Presentation March 2021 Exhibit 99.1
Slide 2: Forward-Looking Statements
/ Moving Infrastructure Forward2 Forward-Looking Statements Some statements in this presentation, which are not historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about Arcosa’s estimate
Slide 3: How to Find Us
/ How to Find Us 3 INVESTOR CONTACT InvestorResources@arcosa.com NYSE TICKER ACA OUR WEBSITE www.arcosa.com HEADQUARTERS Arcosa, Inc. 500 North Akard Street, Suite 400 Dallas, Tx 75201 Moving Infrastructure Forward
Slide 4: Table of Contents
/4 1 3 4 Company Overview Long-Term Vision and Capital Allocation ESG Update Moving Infrastructure Forward 2 Financial Highlights Table of Contents
Slide 5: Company Overview
/5 1 Company Overview Moving Infrastructure Forward
Slide 6: Arcosa's Value Proposition
/6 Arcosa’s Value Proposition Low leverage and ample liquidity to navigate cycles and pursue strategic growth Experienced management team with history of managing through economic cycles Leading businesses serving critical infrastructure markets Track record of executing on strategic priorities in f
Slide 7: Arcosa at a Glance
/7 Arcosa at a Glance Revenues, Adjusted EBITDA and Net Income are for the fiscal year ended 12/31/2020. See Adjusted EBITDA reconciliation in Appendix. Arcosa spun off from its former parent company in November 2018. $107M Net Income $284M Adjusted EBITDA $1.9B Revenues 3 Infrastructure-related Seg
Slide 8: Business Overview
/ Business Overview 8 Revenues Revenues and Adjusted Segment EBITDA and margin for the fiscal year ended 12/31/2020. See Adjusted Segment EBITDA reconciliation in Appendix. ENGINEERED STRUCTURES TRANSPORTATION CONSTRUCTION Segments Adj.Segment EBITDA & Margin Arcosa’s three segments are made up of l
Slide 9: Track Record of Executing on Stage 1 Priorities in First 2 Years
/9 Track Record of Executing on Stage 1 Priorities in First 2 Years Building our new Arcosa culture Executing on Stage 1 Priorities introduced at October 2018 Investor Day Grow Construction Products Improve Engineered Structures margins Expand Transportation Products Operate a flat corporate structu
Slide 10: Strategic Positioning since 2018
/10 Strategic Positioning since 2018 Arcosa has made progress since the 2018 spin in creating a more stable base of revenue and profit, anchored around core infrastructure products Moving Infrastructure Forward 65 113 152 192 213 205 218 365 529 2012 2013 201920172014 20162015 2018 2020 30% CAGR Agg
Slide 11: Financial Highlights
/11 2 Financial Highlights Moving Infrastructure Forward
Slide 12: Recent Financial Results
/12 1,704 1,462 1,460 1,737 1,936 2018 20192016 2017 2020 +33% Recent Financial Results Full Year 2020 Adjusted EBITDA increased 52% since spin outpacing revenue growth and driven by organic expansion, acquisitions, and operating improvements 267 197 187 241 284 2016 20192017 20202018 +52% See Adjus
Slide 13: Cash Flow and Balance Sheet Strength
/ Cash Flow and Balance Sheet Strength Arcosa’s businesses have an attractive free cash flow profile, contributing to a strong balance sheet 13 Note: Free Cash Flow defined as GAAP Operating Cash Flow less GAAP capital expenditures. See reconciliation in Appendix Moving Infrastructure Forward Long-t
Slide 14: COVID-19 Update
/ COVID-19 Update We prioritize the health and safety of our people The health and safety of our employees, communities, and other stakeholders is our highest priority. We have put safeguard measures in place at our plants and office locations to meet or exceed the standards set forth by CDC guideli
Slide 15: 2021 Outlook
/ 2021 Outlook Our guidance is lower than our 2020 performance primarily because of a COVID-led downturn in Barge, but we remain optimistic on the health of our Construction Products and Engineered Structures markets Moving Infrastructure Forward15 See Adjusted EBITDA reconciliation in Appendix. Pos
Slide 16: Long-Term Fundamentals in Each Segment
/16 Long-Term Fundamentals in Each Segment Moving Infrastructure Forward ▪ Infrastructure: Favorable nationwide trends in infrastructure spending, with potential upside from increased federal funding above current FAST Act levels. Outlook in Texas (~60% of volume) particularly strong, supported by i
Slide 17: Long-Term Vision and Capital Allocation
/17 3 Long-Term Vision and Capital Allocation Moving Infrastructure Forward
Slide 18: Our Long-Term Vision
/18 Our Long-Term Vision Grow in attractive markets where we can achieve sustainable competitive advantages Reduce the complexity and cyclicality of the overall business Improve long-term returns on invested capital Integrate Environmental, Social, and Governance initiatives (ESG) into our long-term
Slide 19: Repositioning Arcosa Around More Stable Infrastructure Products
/19 Repositioning Arcosa Around More Stable Infrastructure Products Construction Products 2018 2020 Our 2020 performance highlights our progress in creating a more stable base of revenue and profit, anchored around core infrastructure products Moving Infrastructure Forward ▪ Natural aggregates opera
Slide 20: Attractive Fundamentals of Aggregates and Specialty Materials
/ ▪ Attractive markets with long-term pricing and volume growth; less cyclical than other Arcosa businesses ▪ Sustainable competitive advantages, through reserve positions, product portfolio, proprietary processing capabilities, and deep market knowledge ▪ Fragmented industry structure with ability
Slide 21: Engineered Structures acquisitions in 2020
/21 Traffic structures ▪ March 2020 acquisition of HSI, a leading traffic structures manufacturer ▪ 1 plant in Florida; serves Southeast DESCRIPTION Telecom structures Transmission and Distribution structures CAPITAL DEPLOYED IN 2020 $26M ▪ July 2020 acquisition of Eastpointe Industries, a telecommu
Slide 22: Engineered Structures
/22 Moving Infrastructure Forward Engineered Structures With our acquisitions, we have expanded our product offering in the $3B transmission and distribution markets, as well as entered new large markets tied to infrastructure growth Transmission & Distribution Structures Wind Towers Traffic Structu
Slide 23: ESG Update
/23 4 ESG Update Moving Infrastructure Forward
Slide 24: 2020 ESG in Review
/ 2020 ESG in Review Moving Infrastructure Forward24 2020 ESG Highlights We plan to publish our initial full-year Sustainability Report in the first half of 2021 We have integrated Environmental, Social, and Governance (ESG) responsibility into our daily practices and long-term strategy ▪ Finalized
Slide 25: ESG materiality and reportable metrics
/25 We are committed to developing reportable metrics and establishing meaningful goals in areas important to our stakeholders Our Materiality Assessment was based primarily on SASB standards, with additional input from stakeholders and other sustainability standards, including TCFD Employee Health
Slide 26: Long-term Vision: ESG Update
/ Long-term Vision: ESG Update Moving Infrastructure Forward26 As we integrate ESG initiatives into our long-term strategy, our operations teams have taken an active role in pursuing initiatives that promote environmental responsibility We provide more detail regarding our goals and initiatives in o
Slide 27: Our products are used in environmentally friendly industries
/27 Our products are used in important, environmentally friendly industries Arcosa operates in multiple industries which contribute to environmental protection Arcosa Wind Towers produces steel towers to support our customers’ advancement of America’s wind energy infrastructure. Arcosa Marine builds
Slide 28: Appendix
Appendix
Slide 29: Additional Financial Guidance for 2021
/29 Additional Financial Guidance for 2021 Corporate costs Commentary Moving Infrastructure Forward Capital expenditures Working capital ▪ ~$13-14M per quarter, excluding potential one-time items related to acquisitions and integration ▪ $100-110M in 2021 (~$80M of maintenance capex + ~$20-$30M of g
Slide 30: Non-GAAP Measures
/ Non-GAAP Measures 30 Moving Infrastructure Forward “EBITDA” is defined as net income plus interest, taxes, depreciation, depletion, and amortization. We adjust EBITDA for certain items that are not reflective of the normal earnings of our business (“Adjusted EBITDA”). GAAP does not define EBITDA o
Slide 31: Reconciliation of Adjusted EBITDA and Adjusted Net Income
/ Reconciliation of Adjusted EBITDA and Adjusted Net Income 31 Moving Infrastructure Forward (1) Includes the impact of the fair value markup of acquired long-lived assets. (2) Expenses associated with acquisitions, including the cost impact of the fair value markup of acquired inventory and other t
Slide 32: Reconciliation of Adjusted Segment EBITDA
/ Reconciliation of Adjusted Segment EBITDA 32 Moving Infrastructure Forward ($’s in millions) (unaudited) (1) Expenses associated with acquisitions, including the cost impact of the fair value markup of acquired inventory and other transaction costs. The guidance range for Transportation Products S
Slide 33: Reconciliation of Free Cash Flow and Net Debt to Adjusted EBITDA
/ Reconciliation of Free Cash Flow and Net Debt to Adjusted EBITDA 33 Moving Infrastructure Forward ($’s in millions) (unaudited) (1) Adjusted EBITDA includes 9 month pro forma adjustment of $27.8 million for Cherry during Q2-Q4 of 2019, using previously disclosed annualized EBITDA of $37M. (2) Adju
Slide 34: Strata Materials Adjusted EBITDA
/34 Moving Infrastructure Forward Strata Materials Adjusted EBITDA ($’s in millions) (unaudited) Reconciliation of Strata Materials EBITDA Twelve Months Ended August 31, 2020 Net income $ 5.9 Add: Interest expense, net 0.4 Provision for income taxes - Depreciation, depletion, and amortization expens