Atkore Inc. · NYSE:ATKR
Atkore — Atkore International Group — Investor Presentation (December 2019)
28 slides from Atkore's investor presentation, Dec 3, 2019
Slide 1: Investor Presentation & Company Overview December 2019
Investor Presentation & Company Overview December 2019
Slide 2: Cautionary Statements
Cautionary Statements This presentation contains forward-looking statements that are subject to known and unknown risks and uncertainties, many of which are beyond our control. All statements other than statements of historical fact included in this presentation are forward-looking statements. Forwa
Slide 3: Electrical industry leader with strong financial performance
Electrical industry leader with strong financial performance ■ #1 or #2 market positions in most of our product categories Net sales breakdown By reportable segment By end market ■ Offer must-stock products to distribution and OEM customers Mechanical via single integrated platform Products & U.S. S
Slide 4: Performance driven by the Atkore Business System
Performance driven by the Atkore Business System Strategy Fundamental: ■ Market Insights ■ Portfolio Management ■ Innovation/New Product Development ■ Value Propositions ■ Strategic Pricing ■ Active Account and Channel Management People Fundamental: Processes Fundamental: ■ Engagement and Alignment
Slide 5: We manufacture products that are all around you every day
We manufacture products that are all around you every day Wire Basket Cable Tray Armored Cable Cable Electrical Raceway Tray and Fittings: Conduit & Ladder Cable Electrical Metal Electrical Prefabrication Conduit Metal Specialty Electrical Framing & Conduit: Stainless Fittings Steel, PVC-Coated & Al
Slide 6: Brand reputations built over decades of service to customers
Brand reputations built over decades of service to customers Key brands # of Years in Use Market Categories & Brand Detail Pre-wired armored and metal clad cables, flexible wiring systems, >90 years flexible metal, non-metallic, and flexible metallic liquid tight conduits and fittings. Electrical me
Slide 7: Strong brands and leading market positions anchor portfolio
Strong brands and leading market positions anchor portfolio Leading market positions in each of our major lines of business Rank Market share1 Steel Conduit #2 ~35% PVC Conduit #1 ~35% Raceway Electrical Electrical Armored ~33% Cable #2 In-line Galvanized ~80% Mechanical #1 Tube Metal Mechanical Mec
Slide 8: Driving growth through innovation and portfolio expansion
Driving growth through innovation and portfolio expansion Product innovation and organic growth examples Super Kwik-Couple (SKC) Raintight Conduit BriteRail Product of the Year Category Winner: Product of the Year Category Winner: Conduit, Raceways & Wireways Fasteners, Hangers & Accessories ■ Indus
Slide 9: M&A strategy supporting and enhancing organic growth
M&A strategy supporting and enhancing organic growth Portfolio changes – 2012 to 2019 Added over $400 million in profitable proforma revenue + Built PVC business – acquired Heritage Plastics, Ridgeline Pipe Manufacturing and American Pipe & Plastics + Enhanced size and scale in PVC and Metal Conduit
Slide 10: Broad and growing portfolio provides value to customers
Broad and growing portfolio provides value to customers Value proposition Blue chip customer base Global Electrical Distributors Independent Electrical Distributors ■ Brands and reputation Industrial Distributors ■ Product breadth & Big Box Retail ■ Bundling, co-loading and value-add advantages ■ Qu
Slide 11: Disciplined capital approach drives value for stockholders
Disciplined capital approach drives value for stockholders Disciplined approach to capital deployment Manage Reinvest in the Mergers & Return Cash to Leverage Business Acquisitions Stockholders ▪ Target ~2x times for ▪ Maintain and grow ▪ Structured ▪ $50M in stock buyback Net Debt to the business w
Slide 12: Strong business foundation supports future investment
Strong business foundation supports future investment Investment highlights ▪ The Atkore Business System is the foundation of our operating performance ▪ Strong brands and leading market positions in key product categories that are all around you every day ▪ Solid financial and operating results acr
Slide 13: Fourth Quarter and Full Year 2019
Fourth Quarter and Full Year 2019 Earnings Presentation As presented on November 22, 2019
Slide 14: FY 2019 Highlights and Financial Summary
FY 2019 Highlights and Financial Summary Delivered Net Income of $139M FY FY Y/Y Change ($’s in millions) 2019 2018 Increased Adjusted EBITDA by $53M, or ~20% year over year improvement Net Sales $1,916.5 $1,835.1 +4.4% Operating Income $223.7 $179.7 +24.5% Reduced Net Debt/Adjusted EBITDA from 2.9x
Slide 15: Consolidated Atkore Q4 2019 Highlights
Consolidated Atkore Q4 2019 Highlights Strong volume growth of 8.4% driven by gains in Q4 Net Sales Bridge both Electrical Raceway and Mechanical $40 Products & Solutions $20 $502M $478M $2 $34 2018 Volume/Mix Price M&A FX 2019 Q4 Adjusted EBITDA Bridge Delivered $18M in adjusted EBITDA growth by $1
Slide 16: Consolidated Atkore Q4 2019 Financial Summary
Consolidated Atkore Q4 2019 Financial Summary Q4 Q4 Y/Y Net Sales Growth Change Volume/Mix +8.4% ($’s in millions) 2019 2018 Price (7.0%) Net Sales $501.7 $477.6 +5.1% Acquisitions/Divestitures +4.2% Operating Income $66.2 $46.7 +41.8% FX (0.5%) Net Income $46.0 $32.7 +40.7% Total 5.1% Adjusted EBIT
Slide 17: Electrical Raceway Q4 Highlights
Electrical Raceway Q4 Highlights Excellent results in Q4 with 17.2% growth in Q4 Q4 Y/Y Adjusted EBITDA 2019 2018 Change ($’s in millions) Net Sales $373.3 $355.0 +5.2% Solid volume growth of 6.5%; five new product introductions in the quarter and continued Adjusted EBITDA $80.0 $68.2 17.2% growth f
Slide 18: Mechanical Products & Solutions Q4 Highlights
Mechanical Products & Solutions Q4 Highlights Very strong volume growth led by several large Q4 Q4 Y/Y renewable energy projects 2019 2018 Change ($’s in millions) Net Sales $128.7 $123.0 +4.6% Focus on mix management helped drive adjusted EBITDA gains in Q4 Adjusted EBITDA $21.1 $11.8 +79.2% Adjust
Slide 19: Key Balance Sheet and Cash Flow Metrics
Key Balance Sheet and Cash Flow Metrics Metrics Leverage Ratio(2) ($’s in millions) 9/30/2019 Cash and cash equivalents $123.4 Reduced by 0.9x 3.1 Total Debt $845.3 2.9 2.9 Net Debt $721.9 2.8 FY19 Net cash from operating activities $209.7 2.6 FY19 Capital expenditures $34.9 FY19 Free cash flow(1) $
Slide 20: Financial Outlook Summary
Financial Outlook Summary Q1 2020 FY 2020 Electrical Raceway Volume +1 to 2% Segment Adjusted EBITDA* $69 - $73M $303 - $313M Volume +1 to 3% Mechanical Products & Solutions Segment Adjusted EBITDA* $11 - $15M $70 - $75M Adjusted EBITDA* $72 - $77M $335 - $345M Adjusted EPS* $0.80 - $0.85 $3.80 - $3
Slide 21: Appendix
atkore Appendix a INTERNATIONAL Se
Slide 22: Consolidated Atkore FY 2019 Information
Consolidated Atkore FY 2019 Information FY 2019 Net Sales Bridge Net Sales Growth Volume/Mix +1.4% $47 $1,917M $17 $25 $7 $1,835M Price +0.9% Acquisitions/Divestitures +2.6% FX (0.5%) Total 4.4% 2018 Volume/Mix Price M&A FX 2019 FY 2019 Adjusted EBITDA Bridge $39 $5 $324M $2 $2 $12 $272M 2018 Volume
Slide 23: Segment Information
Segment Information Three Months Ended September 30, 2019 September 30, 2018 Adjusted Adjusted Adjusted EBITDA Adjusted EBITDA (in thousands) Net sales EBITDA Margin Net sales EBITDA Margin Electrical Raceway $ 373,344 $ 80,000 21.4 % $ 354,968 $ 68,235 19.2 % MP&S 128,661 $ 21,137 16.4 % 123,030 $
Slide 24: Adjusted Earnings Per Share Reconciliation
Adjusted Earnings Per Share Reconciliation Consolidated Atkore International Group Inc. Three Months Ended Fiscal Year Ended September 30, September 30, September 30, September 30, (in thousands, except per share data) 2019 2018 2019 2018 Net income $ 45,997 $ 32,699 $ 139,051 $ 136,645 Stock-based
Slide 25: Net Income to Adjusted EBITDA Reconciliation
Net Income to Adjusted EBITDA Reconciliation Consolidated Atkore International Group Inc. Three Months Ended Fiscal Year Ended September September September September September September September (in thousands) 30, 2019 30, 2018 30, 2019 30, 2018 30, 2017 30, 2016 30, 2015 Net income $ 45,997 $ 32,
Slide 26: Trailing Twelve Month Adjusted EBITDA Reconciliation
Trailing Twelve Month Adjusted EBITDA Reconciliation Consolidated Atkore International Group Inc. TTM Three months ended September 30, September 30, December 28, (in thousands) 2019 2019 June 28, 2019 March 29, 2019 2018 Net income $ 139,051 $ 45,997 $ 36,550 $ 29,555 $ 26,949 Interest expense, net
Slide 27: Net Debt to Total Debt and Leverage Ratio
Net Debt to Total Debt and Leverage Ratio Consolidated Atkore International Group Inc. September June 28, March 29, December September June 29, ($ in thousands) 30, 2019 2019 2019 28, 2018 30, 2018 2018 Short-term debt and current maturities of long-term debt $ — $ — $ — $ 26,561 $ 26,561 $ 7,630 Lo
Slide 28: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation Consolidated Atkore International Group Inc. Fiscal year ended (in thousands) September 30, 2019 September 30, 2018 Net cash provided by operating activities $ 209,694 $ 145,703 Capital Expenditures (34,860) (38,501) Free Cash Flow $ 174,834 $ 107,202 28
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