Slide 1: Fiscal 2022 Fourth Quarter Earnings Call
Apogee Enterprises, Inc. Fiscal 2022 Fourth Quarter Earnings Call April 7, 2022 5050 Syracuse | Denver, CO | © JC Buck/Black Bike Productions LLC
Slide 2: Non-GAAP measures & forward-looking statements
Non-GAAP measures & forward-looking statements This presentation contains non-GAAP financial measures which the company uses to evaluate historical and prospective financial performance, measure operational profitability on a consistent basis, and provide enhanced transparency to the investment comm
Slide 3: Agenda
Agenda Introductory remarks Ty Silberhorn Chief Executive Officer Financial results and outlook Nisheet Gupta Executive Vice President and Chief Financial Officer Q&A 330 Madison Avenue | New York | LEED Gold Q4 FY2022 Earnings | April 7, 2022 Apogee Enterprises, Inc. 3
Slide 4: Executing our New Enterprise Strategy
Executing our New Enterprise Strategy Three Pillar Enterprise Strategy ECONOMIC ACTIVELY STRENGTHEN LEADER MANAGE CORE IN TARGET THE PORTFOLIO CAPABILITIES & MARKETS PLATFORMS To Unlock Profitable Growth FOUNDATIONAL ENABLERS • Results-driven Culture • Apogee Management System • Talent Development •
Slide 5: Create Peak Value by building differentiated businesses
OUR AMBITION GOING FORWARD IS CLEAR Create Peak Value by building differentiated businesses with strong operational execution One World Trade Center – New York © Corin Blazing; featuring Viracon glass 5 CONFIDENTIA
Slide 6: FY2022 Highlights
FY2022 Highlights ✓ Completed enterprise strategy work ✓ Realigned AFS to increase focus on target markets and build more competitive cost model ✓ Refocused Architectural Glass to emphasize differentiated, high value-add products ✓ Drove significant progress on enterprise transformation initiatives
Slide 7: FY2023 Priorities
FY2023 Priorities KPI ECONOMIC • Advance Lean / Continuous Improvement initiative LEADER Margin IN TARGET • Drive effective price management expansion MARKETS • Invest to grow value-add offerings • Strengthen M&A capabilities ACTIVELY ROIC MANAGE • Integrate Sotawall improvement THE PORTFOLIO • Incr
Slide 8: FY2022 Fourth-Quarter Results
FY2022 Fourth-Quarter Results $ in millions, except EPS Q4 FY22 Q4 FY21 Change Highlights • Pricing & cost reductions mitigated impact of inflation Net sales $328 $309 6% • Record revenue and operating income in Arch. Services Adjusted operating income* $27.7 $22.0 26% • Strong revenue growth in Lar
Slide 9: FY2022 Full-Year Results
FY2022 Full-Year Results $ in millions, except EPS FY2022 FY2021 Change Highlights • Adjusted EPS improved sequentially each quarter Net sales $1,314 $1,231 7% • Revenue growth in 3 of 4 segments Adjusted operating income* $82.6 $87.1 (5)% • Pricing & cost reductions mitigated impact of inflation Ad
Slide 10: Segment Results
Segment Results Fourth Quarter FY2022 Full Year FY2022 Adjusted Adjusted Revenue Revenue operating operating $M $M margin* margin* Architectural Framing Systems $143 3.8% Architectural Framing Systems $597 5.8% Year-over-year change 9% 110 bps Year-over-year change 5% 60 bps Architectural Glass $73
Slide 11: Cash Flow and Balance Sheet
Cash Flow and Balance Sheet $ in millions FY2022 FY2021 Highlights Cash flow from operations $100.5 $141.9 • Continued strong free cash flow Capital expenditures $21.8 $26.2 • Asset sales contributed additional $31 million of cash flow Free cash flow* $78.7 $115.7 • Net debt / adjusted EBITDA below
Slide 12: Capital Allocation Strategy
Capital Allocation Strategy Invest in Return Maintain a Profitable Capital to Strong Growth Shareholders Balance Sheet • High-return organic • Continued • Target leverage of investments dividend growth 1.5x Adj. EBITDA • M&A (active • Opportunistic • Capacity to flex portfolio manager) buybacks high
Slide 13: FY2023 Outlook
FY2023 Outlook Key Assumptions • Expect revenue growth, primarily driven by Framing Systems • Revenue in other three segments roughly flat vs. F22 Adjusted earnings $2.90 to $3.30 • Continued challenges from inflation and supply chain +17% to 33% per share* • Expect margin expansion, primarily drive
Slide 14: Segment Margin Potential
Segment Margin Potential Updating our guidance for segment margin potential (by FY25), to reflect moving Sotawall from Framing Systems to Services MARGIN POTENTIAL VALUE DRIVERS (by FY25) • Integration Framing • Cost performance 9-12% Systems • Focused growth • Cost & productivity Glass • Quality, s
Slide 15: Concluding Remarks
Concluding Remarks • Executing our new strategy to position for the long term • Taking action to offset inflation and supply chain challenges • Sequential performance improvements each quarter this year • Strong cash flow and balance sheet • Deploying capital to drive value • Expect continued progre
Slide 16: Q&A
Q&A Q4 FY2022 Earnings | April 7, 2022 Apogee Enterprises, Inc. 16
Slide 17: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures Adjusted net earnings and adjusted earnings per diluted common share (unaudited) Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended In thousands February 26, 2022 February 27, 2021 February 26, 2022 February 27, 2021 Net (loss)
Slide 18: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures Adjusted operating income and adjusted operating margin (unaudited) Three Months Ended February 26, 2022 Framing Systems Segment Glass Segment LSO Segment Corporate Consolidated Operating Operating Operating Operating Operating Operating Operating Operat
Slide 19: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures Adjusted operating income and adjusted operating margin (unaudited) Twelve Months Ended February 26, 2022 Framing Systems Segment Glass Segment LSO Segment Corporate Consolidated Operating Operating Operating Operating Operating Operating Operating Opera
Slide 20: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures EBITDA and Adjusted EBITDA (Unaudited) Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended In thousands February 26, 2022 February 27, 2021 February 26, 2022 February 27, 2021 Net (loss) earnings $(16,273) $ (42,371) $ 3,486 $ 1
Slide 21: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures Return on Invested Capital Reconciliation (unaudited) Three Months Ended Three Months Ended In thousands, except percentages February 26, 2022 February 27, 2021 Operating income $ 22,045 $ 25,527 Impairment (1) 49,473 70,069 Restructuring costs (2) 30,51
Slide 22: Reconciliation of non-GAAP financial measures
Reconciliation of non-GAAP financial measures Footnotes to non-GAAP reconciliation tables (1) Adjustment related to impairment charge recorded during the fourth quarter of the current year on indefinite- and long-lived intangible assets within the Architectural Framing Systems segment as a result of
Slide 23: Pro Forma Segment Results
Pro Forma Segment Results Fiscal 2022 Reclassified Pro Forma Segment Data (unaudited) Net Sales for FY2022 Pro Forma Net Sales for Reclassified Segments for FY2022* (in thousands) Q1 Q2 Q3 Q4 FY 2022 (in thousands) Q1 Q2 Q3 Q4 FY 2022 Architectural Framing Systems 151,840 149,972 151,665 143,132 596