Fortune Brands Innovations, Inc. · NYSE:FBIN
Fortune Brands Innovations — Fortune Brands Home & Security — Investor Presentation (February 2014)
23 slides from Fortune Brands Innovations's investor presentation, Feb 6, 2014
Slide 1: Maximizing Long-Term Value
Exhibit 99.1 MAXIMIZING LONG-TERM VALUE wy Home & Security February 2014
Slide 2: Core Growth / Incremental Growth
CORE GROWTH Creating value by leveraging our structural competitive advantages to gain share and drive profitable growth in a recovering market INCREMENTAL GROWTH Creating incremental value by utilizing our strong balance sheet and cash flow
Slide 3: A Solid Foundation to Maximize Long-Term Shareholder Value
A Solid Foundation to Maximize Long-Term Shareholder Value Maximizing Long-Term Value Incremental Growth Creating incremental value by utilizing our strong balance sheet and cash flow Core Growth Creating value by leveraging our structural competitive advantages to gain share and drive profitable gr
Slide 4: Solid Business Model
Solid Business Model Structural competitive Drives outsized growth and share advantages gains in a recovering market Attractive product categories Consumer involved in purchase Keeps product lines fresh and Consumer driven innovation on trend – exciting consumers Creates industry leading Operational
Slide 5: Core Growth
CORE GROWTH Creating value by leveraging our structural competitive advantages to gain share and drive profitable growth in a recovering market
Slide 6: Fortune Brands Home & Security 2013 Sales: $4.2B
Fortune Brands Home & Security 2013 Sales: $4.2B Net Operating 1 Brand Leadership Sales Margin Kitchen & bath Kitchen & Bath Cabinetry #1 residential cabinet manufacturer in North America $1.6B 7.3% Plumbing & Accessories #1 Faucet brand in North America $1.3B 17.8% Fiberglass residential #1 entry d
Slide 7: Kitchen & Bath Cabinetry
Kitchen & Bath Cabinetry Largest and most profitable North American cabinet business well-positioned to continue to gain share and drive profitable growth COMPETITIVE ADVANTAGES Benefits of Competitive Advantages Regional supply chain and service Leading North American market share and growing footp
Slide 8: Plumbing & Accessories
Plumbing & Accessories North American market share leader well-positioned to gain share and drive profitable growth COMPETITIVE ADVANTAGES Benefits of Competitive Advantages Exclusive national, multi-year contracts Leading market share in North America and growing with majority of largest builders G
Slide 9: Windows & Doors
Windows & Doors Leader in fiberglass entry doors and best lead times in vinyl window industry COMPETITIVE ADVANTAGES Benefits of Competitive Advantages Innovative fiberglass material leadership Therma-Tru is the leading fiberglass entry door brand in North America and growing • Fiberglass is the fas
Slide 10: Security & Storage
Security & Storage Master Lock is an iconic brand with strong market share and significant potential to leverage the brand to expand globally COMPETITIVE ADVANTAGES Benefits of Competitive Advantages Master Lock holds leading market share of domestic Master Lock has leading brand retail padlocks awa
Slide 11: Market Outlook
Market Outlook We have come through a historic downturn but still have a long way to go to return to the long-term average housing starts – driven by household formations and demolitions. 11 Source: U.S. Census Bureau and internal company data
Slide 12: Market Outlook
Market Outlook In addition to public data, we receive unique insight to current R&R market trends from our leading position in the Kitchen & Bath dealer channel Repair & Remodel (“R&R”) 7% 6-7% 5-6% 5-6% 4-5% 2012 2013E 2014E 2015E 2016E Long-term Historical Average Pent-up demand has developed Cons
Slide 13: Potential From Core Growth
Potential From Core Growth Creating value by leveraging our structural competitive advantages to gain share and drive profitable growth in a market that we expect to recover to 1.5M housing starts and 6-7% R&R growth First Phase 2 Years Demonstrated Success Growth NET $3.3 $4.2 25% SALES ($ in Billi
Slide 14: Incremental Growth
INCREMENTAL GROWTH Creating incremental value by utilizing our strong balance sheet and cash flow
Slide 15: Incremental Growth Opportunities
Incremental Growth Opportunities Over the next 3+ + years, the combination of free cash flow and reasonable debt leverage could create $2.8 billion of available cash 3+ Years Outlook ($ in Billions) $2.8 $1.8 2.0x EBITDA $1.0 1.5x EBITDA Cumulative Free Balance Sheet Cash Available to Cash Flow Leve
Slide 16: Capital Allocation
Capital Allocation Efficient cash management providing maximum flexibility to leverage cash and a strong balance sheet for acquisitions, expansion into new markets and adjacent categories, and return cash to shareholders Acquisitions • Expand in current categories or adjacent categories globally • E
Slide 17: Multiple Growth Opportunities
Multiple Growth Opportunities Initially, the economic recovery will drive significant organic growth. Beyond the recovery, product innovations, market expansions and acquisitions will accelerate growth as cash and a strong balance sheet are leveraged to create value. Next Phase Beyond First Phase Ti
Slide 18: 2014 Guidance
2014 Guidance Based on more than two years of strong and improving performance and continued confidence in the home products market recovery, FBHS expects the following performance for full-year 2014 results: 2013 Actual 2014 Guidance U.S. Home 10% +10-11% Products Market Net Sales $4.2B +11-13% EPS
Slide 19: Disclaimer
Disclaimer This presentation contains certain “forward-looking statements” regarding business strategies, market potential, future financial performance and other matters, including all statements with respect to the "Next Phase" and "guidance" and statements with words such as "will," "should," "co
Slide 20: Appendix
CORE GROWTH Creating value by leveraging our structural competitive advantages to gain share and drive profitable growth in a recovering market Appendix INCREMENTAL GROWTH Creating incremental value by utilizing our strong balance sheet and cash flow
Slide 21: Balanced & Diverse Business Mix
Balanced & Diverse Business Mix Our business mix is driven by Repair and Remodel International is 16% of net sales, Canada is 10% and China is 4% Domestic Home By End Market* By Channel* Products Market* International International 16% Builder 16% Commercial Direct New 5% 4% Home Construction Repair
Slide 22: Since 2009, we have restructured, recovered, and are moving forward
Since 2009, we have restructured, recovered, and are moving forward towards earnings and cash flow growth Fiscal Year Ending December 31 ($ millions) 2006 2009 2011 2012 2013 Net Sales $4,694 $3,007 $3,329 $3,591 $4,157 % Growth vs. Prior Year 13% (20%) 3% 8% 16% Operating Income 1 $ 678 $ 81 $ 163
Slide 23: References
References Page 7: Simonton Windows received the highest numerical score among window and door manufacturers in a tie in the proprietary J.D. Power 2010-2013 Windows and Patio Doors Satisfaction Studies SM (Tied in 2013). 2013 study based on responses from 2,554 consumers measuring 11 brands and mea
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