Rpm International Inc. · NYSE:RPM
Rpm International — Q1 2024 Earnings Presentation
24 slides from Rpm International's earnings presentation, Oct 4, 2023
Slide 1: Fiscal 2024 First-Quarter Results
Fiscal 2024 First-Quarter Results October 4, 2023
Slide 2: Forward-Looking Statements & Regulation G
Forward-Looking Statements & Regulation G This presentation contains “forward-looking statements” relating to our business. These forward-looking statements, or other statements made by us, are made based on our expectations and beliefs concerning future events impacting us and are subject to uncert
Slide 3: Record Consolidated Q1-24 Sales and All-Time Record Adjusted EBIT
Record Consolidated Q1-24 Sales and All-Time Record Adjusted EBIT FINANCIAL HIGHLIGHTS Consolidated Sales and Adjusted EBIT Growth 40% Sales Growth Adj. EBIT Growth(1) 36.4% 35% 33.1% $2.01B 30% 25% RECORD Q1 SALES 20% +4.1% 17.1% 15% 12.3% 9.3% 7 Consecutive 10% Quarters $309.0M 5% 5.7% 4.2% 1.6% 2
Slide 4: Strong Execution and MAP 2025 Drive Record Consolidated Results
Strong Execution and MAP 2025 Drive Record Consolidated Results 2-Year Stacked Consolidated Q1 Growth CPG PCG SPG Consumer Consolidated 49.4% 50% Record Sales Q1-24 40% Record Adjusted EBIT¹ Q1-24 30% HIGHLIGHTS 21.9% • Record Q1 consolidated sales, driven by increased pricing 20% • Continued strong
Slide 5: Sales Growth in USD by Region | Q1-24
Sales Growth in USD by Region | Q1-24 EUROPE NORTH AMERICA 14% of total sales 79% of total sales +9.3% +2.7% ASIA/PACIFIC 2% of total sales -3.1% AFRICA/MIDDLE EAST/ CONSOLIDATED OTHER FOREIGN TOTAL 1% of total sales LATIN AMERICA +16.5% +4.1% 4% of total sales +15.8% Fiscal 2024 First-Quarter Resul
Slide 6: Fiscal 2024 First-Quarter Financial Results | Consolidated
Fiscal 2024 First-Quarter Financial Results | Consolidated Record Q1 sales and all-time adjusted EBIT ($ in millions, except Q1 Q1 KEY POINTS 2024 2023 % Change per share amounts) • Record Q1 sales of $2.01 billion driven by pricing with modest volume growth Sales $2,012 $1,932 +4.1% • Sales include
Slide 7: Construction Products Group
Fiscal 2024 First-Quarter Financial Results CPG achieves all-time record sales and adjusted EBIT Q1 Q1 ($ in millions, except margins) % Change Sales Components CONSTRUCTION 2024 2023 PRODUCTS GROUP Sales $782.8 $706.4 +10.8% Organic +9.5% EBIT1 $143.8 $107.5 +33.8% Acquisitions/ +0.6% Divestitures
Slide 8: Performance Coatings Group
Fiscal 2024 First-Quarter Financial Results Record results fueled by MAP 2025 and strong demand for engineered solutions PERFORMANCE ($ in millions, except margins) Q1 2024 Q1 2023 % Change Sales Components COATINGS GROUP Sales $378.5 $363.7 +4.1% Organic +4.0% EBIT1 $43.7 $49.2 -11.2% Acquisitions/
Slide 9: Specialty Products Group
Fiscal 2024 First-Quarter Financial Results Sales and adjusted EBIT negatively impacted by weak OEM demand SPECIALTY ($ in millions, except margins) Q1 2024 Q1 2023 % Change Sales Components PRODUCTS GROUP Sales $181.0 $202.7 -10.7% Organic -9.0% EBIT1 $16.3 $27.9 -41.5% Acquisitions/ -2.2% Divestit
Slide 10: Consumer Group
Fiscal 2024 First-Quarter Financial Results MAP 2025 benefits drove growth, despite challenging comparisons Q1 Q1 CONSUMER ($ in millions, except margins) 2024 2023 % Change Sales Components GROUP Sales $669.6 $659.5 +1.5% Organic +1.7% EBIT1 $131.1 $116.7 +12.4% Acquisitions/ 0.0% Divestitures Adju
Slide 11: Working Capital Management Results in All-Time Record Cash Flow from Operations
Working Capital Management Results in All-Time Record Cash Flow from Operations Inventories $1,400 Q1-24 Update $1,300 • Reduced inventories by $222.5 million from Q1-23 $1,200 • Record Q1-24 cash flow from operations +$359.2 In millions million compared to +$23.6 million in Q1-23 $1,100 • Paid $54.
Slide 12: Pure Air
Pure Air • Increases HVAC efficiency / capacity • Improves air quality • Significant savings compared to HVAC replacement • Reduces disruption to occupants • Pure Air has doubled trailing 12-month sales since joining RPM Expands CPG’s offering of products and services focused on maintenance & restor
Slide 13: Fiscal 2024 Second-Quarter Guidance
Fiscal 2024 Second-Quarter Guidance CATEGORY Q2-24 OUTLOOK (YOY) PRIOR-YEAR RECORD SALES | Consolidated +LSD % Construction Products Group +MSD % Performance Coatings Group +MSD % Specialty Products Group -LDD % Consumer Group +LSD % ADJUSTED EBIT | Consolidated +HSD % to LDD % LSD = Low Single Digi
Slide 14: Fiscal Year 2024 Guidance
Fiscal Year 2024 Guidance CATEGORY FY24 OUTLOOK (YOY) PRIOR-YEAR RESULTS PRIOR-YEAR RECORD SALES | Consolidated +MSD % +8.2% ADJUSTED EBIT | Consolidated +LDD to +Mid-Teen % +18.8% MSD = Mid Single Digit | LDD = Low Double Digit Expected FY24 Trends • Modest economic growth • Moderating headwinds fr
Slide 15: Appendix: Reconciliation of Non-GAAP to GAAP Measures
Appendix Reconciliation of Non-GAAP to GAAP Measures October 4, 2023
Slide 16: Consolidated Statements of Income: Three Months
Consolidated Statements of Income: Three Months ($ in thousands, except per share and percent data) (Unaudited) Three Months Ended August 31, 2023 % 2022 % % Change Net Sales $ 2,011,857 $ 1,932,320 4.1 Cost of Sales 1,183,240 58.8 1,187,849 61.5 Gross Profit 828,617 41.2 744,471 38.5 SG&A 531,032 2
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures The following are the non-GAAP financial measures used in this presentation: *Interest (Income) Expense, Net includes the combination of interest (income) expense and investment (income) expense, net. **EBIT is defined as earnings (loss) before interest and taxes. Managem
Slide 18: Adjustments Detail
Adjustments Detail a) Charges recorded in Cost of Goods Sold related to inventory write-offs in connection with restructuring activities at our Construction Products, Performance Coatings and Specialty Products segments. b) Reflects restructuring charges, including headcount reductions, impairments,
Slide 19: Reconciliation of Reported to Adjusted EPS: Three Months
Reconciliation of "Reported" to "Adjusted" EPS: Three Months (Unaudited) Reconciliation of Reported Earnings per Diluted Share to Adjusted Three Months Ended August 31, Earnings per Diluted Share (All amounts presented after-tax): 2023 2022 Reported Earnings per Diluted Share $ 1.56 $ 1.31 Restructu
Slide 20: EBIT (Non-GAAP): RPM Consolidated: Three Months
EBIT** (Non-GAAP Measure): RPM Consolidated: Three Months ($ in thousands, except percent data) Three Months Ended August 31, (Unaudited) 2023 2022 Net Income $ 201,313 $ 169,279 Provision for Income Taxes 67,841 55,842 Income Before Income Taxes 269,154 225,121 Interest Expense 31,818 26,711 Invest
Slide 21: EBIT (Non-GAAP): Construction Products Segment: Three Months
EBIT** (Non-GAAP Measure): Construction Products Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended August 31, 2023 2022 Income Before Income Taxes $ 140,452 $ 106,755 Add: Interest Expense, Net* 3,396 780 EBIT** (non-GAAP measure) 143,848 107,535 Inventory-re
Slide 22: EBIT (Non-GAAP): Performance Coatings Segment: Three Months
EBIT** (Non-GAAP Measure): Performance Coatings Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended August 31, 2023 2022 Income Before Income Taxes $ 44,821 $ 49,401 Add: Interest (Income), Net* (1,124) (194) EBIT** (non-GAAP measure) 43,697 49,207 Inventory-re
Slide 23: EBIT (Non-GAAP): Specialty Products Segment: Three Months
EBIT** (Non-GAAP Measure): Specialty Products Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended August 31, 2023 2022 Income Before Income Taxes $ 16,397 $ 27,885 Add: Interest (Income), Net* (99) (2) EBIT** (non-GAAP measure) 16,298 27,883 Inventory-related c
Slide 24: EBIT (Non-GAAP): Consumer Segment: Three Months
EBIT** (Non-GAAP Measure): Consumer Segment: Three Months ($ in thousands, except percent data) (Unaudited) Three Months Ended August 31, 2023 2022 Income Before Income Taxes $ 131,829 $ 116,689 Add: Interest (Income), Net* (750) (26) EBIT** (non-GAAP measure) 131,079 116,663 Restructuring expense (