Columbus Mckinnon Corporation · NASDAQ:CMCO
Columbus Mckinnon — Q4 FY2022 Earnings Presentation
27 slides from Columbus Mckinnon's earnings presentation, May 25, 2022
Slide 1: Q4 Fiscal Year 2022 Financial Results Conference Call
Q4 Fiscal Year 2022 Financial Results Conference Call May 25, 2022 David J. Wilson President and Chief Executive Officer Gregory P. Rustowicz Senior Vice President – Finance & Chief Financial Officer
Slide 2: Safe Harbor Statement
Safe Harbor Statement These slides, and the accompanying oral discussion (together, this “presentation”), contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements concerning: future sa
Slide 3: Delivered Exceptional Growth in Q4 FY22
Delivered Exceptional Growth in Q4 FY22 Demonstrating success advancing the transformation into a higher growth business 36% Increase in Sales to $253 million • Better than expected revenue growth of $67.1 million in the quarter driven by strong demand in all markets • Organic revenue growth was 17%
Slide 4: Business Model Evolution
Business Model Evolution Growth strategy substantially advances underlying portfolio Revenue CMCO FY21 CMCO FY22 Growth Rate Recast for Growth Profile With Conveying Solutions Platform Lifting Solutions Lifting Solutions 73% 61% Conveying Solutions 16% Industrial Products 42% Linear Motion 12% Autom
Slide 5: Net Sales
Net Sales ($ in millions) Q4 sales up 36.0% from prior-year period due to Quarter Sales Bridge acquisitions, strong demand and strategic pricing Quarter • U.S.: 15.9% volume and 4.7% pricing increase • Non-U.S.: 8.9% volume and 4.3% pricing increase Q4 FY21 Sales $ 186.2 Acquisitions 40.5 21.7% Volu
Slide 6: Gross Profit & Margin
Gross Profit & Margin ($ in millions) Quarter Gross Profit Bridge $85.5 $81.1 Quarter $74.1 $75.1 Q4 FY21 Gross Profit $ 64.1 $64.1 Acquisitions 17.3 36.7% 36.7% Sales volume and mix 7.6 36.3% Pricing, net of material cost inflation 3.0 34.8% Business realignment costs, net 0.3 34.6% Tariffs (0.5) P
Slide 7: RSG&A
RSG&A ($ in millions) RSG&A as % of sales: 25.1% 26.8% 22.9% 24.8% 21.6% Q4 FY22 RSG&A in line with expectations • Included $1.1 million in business realignment costs $57.2 $53.5 $54.8 YOY increase due to acquisitions and recovery in $51.2 $46.7 $3.6 business $3.9 $4.1 $3.8 • Incremental $7.7 millio
Slide 8: Operating Income
Operating Income ($ in millions) Operating Income & Margin Q4 FY22 operating income of $24.1 million $23.7 $24.1 • Adjusted operating income of $28.6 million $14.2 $15.3 • Increased on higher volume, acquisitions and pricing $10.7 Operating margin of 9.5%; Adjusted operating 7.6% 5.0% 10.6% 7.1% 9.5
Slide 9: Earnings Per Share
Earnings Per Share GAAP Diluted EPS Q4 FY22 net income of $11.8 million $0.53 $0.39 $0.34 $0.41 Adj. net income of $22.7 million in the quarter • $6.6 million of amortization of intangibles • $1.1 million of business realignment costs • $3.4 million of non-cash acquisition related expense ($0.27) Q4
Slide 10: Adjusted EBITDA & ROIC
Adjusted EBITDA & ROIC Adjusted EBITDA Margin Adjusted EBITDA margin benefits from accretive acquisitions and strong demand 15.7% 15.4% • Q4 FY22 Adjusted EBITDA margin of 15.4% up 150 basis points from prior year 11.9% • 190 basis point contribution from acquisitions YTD FY20 FY21 FY22 Return on In
Slide 11: Cash Flow
Cash Flow ($ in millions) (2) Three Months Ended Year Ended Free Cash Flow 3/31/22 3/31/21 3/31/22 3/31/21 Net cash provided by $97.4 operating activities $25.2 $26.9 $48.9 $98.9 $86.6 CapEx (3.6) (6.4) (13.1) (12.3) $67.2 Free cash flow (FCF) $21.6 $20.5 $35.8 $86.6 Note: Components may not add to
Slide 12: Capital Structure
Capital Structure ($ in millions) CAPITALIZATION Financial flexibility March 31, March 31 • ~$198 million of liquidity 2022 2021 Cash and cash equivalents $ 115.4 $ 202.1 Pro-forma net debt leverage ratio of ~2.7x(1) Total debt • Net debt to net total capital: 33.9% 511.2 249.0 Total net debt 395.8
Slide 13: Orders and Backlog
Orders and Backlog ($ in millions) Continued Strength in Orders Record backlog of $309.1 million • 29% year-over-year increase driven by strong demand across • Up 10% in both short-cycle and project businesses, sequentially all markets • Precision conveyance backlog down 13% based on project • Avg d
Slide 14: Outlook and Perspective
Outlook and Perspective Q1 FY2023 outlook • Expect Q1 FY23 net sales of approximately of $220 million to $230 million(1), a mid-single digit organic growth rate year-over-year • Assumes FX headwind year-over-year at current rates ($8 million to $9 million) and production schedule that accommodates E
Slide 15: Q4 Fiscal Year 2022 Financial Results Conference Call
Q4 Fiscal Year 2022 Financial Results Conference Call May 25, 2022 David J. Wilson President and Chief Executive Officer Gregory P. Rustowicz Senior Vice President – Finance & Chief Financial Officer
Slide 16: Supplemental Information
CN Supplemental Information COLUMBUS McKINNON
Slide 17: Conference Call Playback Info
Conference Call Playback Info Replay Number: 412-317-6671 passcode: 13728806 Telephone replay available through June 1, 2022 Webcast / PowerPoint / Replay available at investors.columbusmckinnon.com Transcript, when available, at investors.columbusmckinnon.com © 2022 COLUMBUS McKINNON CORPORATION 17
Slide 18: Adjusted Gross Profit Reconciliation
Adjusted Gross Profit Reconciliation ($ in thousands) Quarter Fiscal Year Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 2021 2022 GAAP gross profit $ 64,088 $ 74,063 $ 81,135 $ 75,057 $ 85,475 $ 220,225 $ 315,730 Add back (deduct): Acquisition inventory step-up expense — 2,981 — 515 1,546 — 5,042 Product
Slide 19: Adjusted Income from Operations Reconciliation
Adjusted Income from Operations Reconciliation ($ in thousands) Quarter Fiscal Year Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 2021 2022 GAAP income from operations $ 14,199 $ 10,746 $ 23,660 $ 15,316 $ 24,059 $ 42,255 $ 73,781 Add back (deduct): Acquisition deal and integration costs 3,951 9,242 632 3
Slide 20: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation ($ in thousands, except per share data) Quarter Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 GAAP net income (loss) $ 9,585 $ (7,263) $ 15,203 $ 9,894 $ 11,826 Add back (deduct): Amortization of intangibles 3,174 6,109 6,285 6,254 6,635 Cost of debt refinancing — 14,803
Slide 21: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation ($ in thousands, except per share data) Fiscal Year FY 2019 FY 2020 FY 2021 FY 2022 GAAP net income $ 42,577 $ 59,672 $ 9,106 $ 29,660 Add back (deduct): Amortization of intangibles 14,900 12,942 12,623 25,283 Cost of debt refinancing — — — 14,803 Acquisition deal
Slide 22: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ in thousands) Quarter Fiscal Year Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 2020 2021 2022 GAAP net income (loss) $ 9,585 $ (7,263) $ 15,203 $ 9,894 $ 11,826 $ 59,672 $ 9,106 $ 29,660 Add back (deduct): Income tax expense (benefit) 1,362 (2,517) 4,083 1,066 6,154 17,4
Slide 23: Return on Invested Capital (ROIC) Reconciliation
Return on Invested Capital (ROIC) Reconciliation ($ in thousands) Fiscal Year 2020 2021 2022 GAAP income from operations $ 89,824 $ 42,255 $ 73,781 Add back (deduct): Acquisition deal and integration costs — 3,951 10,473 Acquisition inventory step-up expense — — 5,042 Product liability settlement —
Slide 24: Free Cash Flow & Free Cash Flow Conversion Reconciliation
Free Cash Flow & Free Cash Flow Conversion Reconciliation ($ in thousands) Fiscal Year FY 2019 FY 2020 FY 2021 FY 2022 Cash from operations $ 79,499 $ 106,795 $ 98,890 $ 48,881 Capital expenditures (12,288) (9,432) (12,300) (13,104) Free cash flow (FCF) $ 67,211 $ 97,363 $ 86,590 $ 35,777 Non-GAAP a
Slide 25: Industrial Capacity Utilization
Industrial Capacity Utilization U.S. Capacity Utilization Eurozone Capacity Utilization Source: The Federal Reserve Board Source: European Commission 85% 80% 83% 81% 82.6% Q2 2022 75% 79% 79.2% (Manufacturing) 79.0% (Total) 77% April 2022(1) 75% 70% 73% 71% 65% 69% 67% 60% 65% Manufacturing Total (1
Slide 26: ISM Production Index
ISM Production Index Source: Institute for Supply Chain Management 70% 65% 60% 55% 55.4% 50% April 2022 45% 40% 35% 30% 25% © 2022 COLUMBUS McKINNON CORPORATION 26
Slide 27: Q4 Fiscal Year 2022 Financial Results Conference Call
Q4 Fiscal Year 2022 Financial Results Conference Call May 25, 2022 David J. Wilson President and Chief Executive Officer Gregory P. Rustowicz Senior Vice President – Finance & Chief Financial Officer