Armstrong World Industries Inc · NYSE:AWI
Armstrong World Industries — Q2 2013 Earnings Presentation
22 slides from Armstrong World Industries's earnings presentation, Jul 29, 2013
Slide 1: Earnings Call Presentation 2nd Quarter 2013
Earnings Call Presentation 2nd Quarter 2013 July 29, 2013
Slide 2: Safe Harbor Statement
Safe Harbor Statement Our disclosures in this presentation, including without limitation, those relating to future financial results guidance, and in our other public documents and comments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Those s
Slide 3: Basis of Presentation Explanation
All figures throughout the presentation are in $ millions unless otherwise noted. Figures may not add due to rounding. Basis of Presentation Explanation When reporting our financial results within this presentation, we make several adjustments. Management uses the non-GAAP measures below in managing
Slide 4: Key Metrics - Second Quarter 2013
As reported Net Sales: $707 million in 2013 and $675 million in 2012 As reported Operating Income: $68 million in 2013 and $78 million in 2012 As reported EPS: $0.51 in 2013 and $0.71 in 2012 Cash flow information includes cash flows attributable to Cabinets Unadjusted Key Metrics - Second Quarter 2
Slide 5: Second Quarter 2013 vs. PY - Adjusted EBITDA to Reported Net Income
2013 2012 V EBITDA- Adjusted $98 $110 ($12) Depreciation and Amortization (27) (24) (3) Operating Income - Adjusted $71 $86 ($15) Foreign Exchange Movements - - - Cost Reduction Initiatives (3) (7) 4 Accelerated Depreciation (not included above) - (1) 1 Operating Income - As Reported $68 $78 ($10) I
Slide 6: Second Quarter Sales and EBITDA by Segment - 2013 vs. PY
Second Quarter Sales and EBITDA by Segment - 2013 vs. PY 6
Slide 7: Lumber Prices - Appalachian Green Oak vs. Framing Lumber
Lumber Prices - Appalachian Green Oak vs. Framing Lumber 7 (CHART) (1) Hardwood Market Report Published 7/5/13
Slide 8: EBITDA Bridge - Second Quarter 2013 vs. Prior Year
$10 EBITDA Bridge - Second Quarter 2013 vs. Prior Year 8 ($1) ($4) ($3) $1 $110 $98
Slide 9: Free Cash Flow - Second Quarter 2013 vs. Prior Year
Free Cash Flow - Second Quarter 2013 vs. Prior Year 9 Cash flow information includes cash flows attributable to Cabinets ($8) ($1) ($12)
Slide 10: Key Metrics - 1st Half of 2013
As reported Net Sales: $1,329 million in 2013 and $1,311 million in 2012. As reported Operating Income: $115 million in 2013 and $120 million in 2012 As reported EPS: $0.56 in 2013 and $ 1.03 in 2012. Cash flow information includes cash flows attributable to Cabinets Unadjusted 2013 Actual 2012 Actu
Slide 11: 1H Sales and EBITDA by Segment - 2013 vs. 2012
(CHART) 1H Sales and EBITDA by Segment - 2013 vs. 2012 11
Slide 12: EBITDA Bridge - 1H 2013 vs. Prior Year
(CHART) ($3) EBITDA Bridge - 1H 2013 vs. Prior Year 12 ($4) ($4)
Slide 13: Free Cash Flow - 1H 2013 vs. Prior Year
(CHART) Free Cash Flow - 1H 2013 vs. Prior Year 13
Slide 14: Key Metrics - Guidance 2013
2013 Estimate Range (1) 2013 Estimate Range (1) 2013 Estimate Range (1) 2012 (1) Variance Variance Variance Net Sales(2) 2,700 to 2,800 2,623 3% to 7% Operating Income(3) 260 to 290 302 (14)% to (4)% EBITDA 370 to 400 402 (8)% to 0% Earnings Per Share(4) $2.00 to $2.30 $2.53 (21)% to (9)% Free Cash
Slide 15: 2013 Financial Outlook
2013 Financial Outlook $50 - $60 million vs. 2012 Adjusted Gross Margin (100) to (150) bps vs. 2012 15.75% to 16.25% of sales Down $10 million; 60% manufacturing, 40% SG&A $0 - $5 million vs. 2012 $10 - $20 million; Adjusted long-term ETR of ~39%(2) Sales(1) $740 - $780 million; EBITDA $110 - $130 m
Slide 16: Appendix
Appendix 16
Slide 17: Divested Businesses
Cabinets Announced sale in Q3 2012 and finalized sale in Q4 2012 Treated as discontinued operation starting with Q3 2012 Patriot Completed sale in Q3 2012 Results included in the Wood Flooring segment 17 Divested Businesses Patriot impact on Y-o-Y Comparisons Q3 2012 Q4 2012 2012 1H 2013 Q3 2013 201
Slide 18: 1H 2013 - Adjusted EBITDA to Reported Net Income
2013 2012 V EBITDA- Adjusted $177 $194 ($17) Depreciation and Amortization (52) (49) (3) Operating Income - Adjusted $125 $145 ($20) Foreign Exchange Movements (1) (1) - Cost Reduction Initiatives (9) (9) - Accelerated Depreciation and Impairments (not included above) - (10) 10 Impairment - (5) 5 Op
Slide 19: Adjusted Operating Income to Free Cash Flow
2013 Estimate Range 2013 Estimate Range 2013 Estimate Range Adjusted Operating Income 260 to 290 D&A 110 110 110 Adjusted EBITDA 370 to 400 Changes in Working Capital (10) to (30) Capex (180) to (200) Interest Expense (65) to (70) Cash Taxes (10) to (20) Other, including cash payments for restructur
Slide 20: Reported to Adjusted Net Sales, Operating Income and EPS
Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter 2013 Reported Comparability(1) Adjustments FX(2) Adj 2013 Adjusted 2012 Reported Comparability(1) Adjustments FX(2) Adj 2012 Adjusted 2012 Adjusted Ne
Slide 21: Segment Operating Income (Loss)
Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter Second Quarter 2013 Reported Comparability(1) Adjustments 2013 Adjusted 2012 Reported Comparability(1) Adjustments 2012 Adjusted Building Products 65 2 67 54 8 62 Resilient Flooring 17 1 18 22 - 22 Wood Floorin
Slide 22: Cash Flow
Second Quarter Second Quarter YTD YTD ($ millions) 2013 2012 2013 2012 Net cash from operations $57 $63 $43 $30 Net cash (used for) investing (25) (27) (62) (42) Add back (subtract) adjustments to reconcile to free cash flow Restricted cash - - - (2) Free Cash Flow $32 $36 ($19) ($14) Cash Flow 22 C
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