Slide 1: Strong Foundation. Stronger Future. Investor Presentation March 2023
STRONG FOUNDATION. STRONGER FUTURE. Simpson Manufacturing Co., Inc. Investor Presentation March 2023
Slide 2: Safe Harbor
2 Safe Harbor This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 2IE of the Securities Exchange Act of 1934, as amended. Forward-looking statements genera
Slide 3: Investment Highlights
3 Investment Highlights Industry leader with unique business model, strong brand recognition and trusted reputation Diversified product offerings and geographies mitigate exposure to cyclical U.S. housing market Leadership position in wood products with significant opportunities in all addressable m
Slide 4: Simpson's Brand and Culture
4 Simpson’s Brand and Culture At Simpson, we describe the unique culture of our organization as our “Secret Sauce.” To provide solutions that help people design and build safer, stronger structures. OUR MISSION OUR COMPANY VALUES 1. Relentless Customer Focus 2. Long-Range View 3. High-Quality Produc
Slide 5: 28-Year Trading History
5 $0.00 $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 $140.00 $160.00 Note: Stock chart depicts SSD trading history from May 25, 1994 through March 17, 2023. 28-Year Trading History 5/25/1994 Initial public offering at $11.50 (or $2.875 adjusted for two stock splits in August 2002 & November 2004) 3/2
Slide 6: Our Strong Business Model
6 • Innovation • Research & Testing • Technology • Technical & Field Support • Training • Product Availability Long-standing, successful relationships with: • Engineers • Code Officials • Builders • Contractors • Lumberyards • Home Centers • Pro Dealers Our Strong Business Model • Connector Market L
Slide 7: Our Multilayered Approach
7 Our Multilayered Approach • 479 Issued Patents (US and foreign; utility and design) • 1,641 Registered Trademarks (US and foreign) • 220 Patents Pending (US and foreign) • 76 Code Reports Innovation Research & Testing Technical & Field Support Product Availability Technology • 7 Accredited Test La
Slide 8: Core Addressable Market
8 Core Addressable Market(1) Wood Connectors & Truss Concrete Market Size $15.0 B Addressable Market $1.3 B (9%) SSD Share $296 M (23%) Market Size $10.1 B Addressable Market SSD Share $492 M (29%) Market Size/ Addressable Market $2.5 B SSD Share $1.35 B (54%) Fasteners $1.7 B (17%) (1) Note: Market
Slide 9: Commitment to Growth
9 Commitment to Growth OEM R&R / DIY STRUCTURAL STEEL MASS TIMBER KEY GROWTH INITIATIVES FOCUSED ON: CONCRETE LEADER IN ENGINEERED LOAD-RATED CONSTRUCTION FASTENING SOLUTIONS LEADER IN CUSTOMER-FACING TECHNOLOGY
Slide 10: OEM
10 OEM RATIONALE KEY GOAL STRATEGY • $420 M total addressable market primarily with fastening technologies • Potential to develop other engineered solutions • 2,500 existing Simpson products applicable for OEM needs • Our solutions make the industry more efficient • Aligned with the Simpson business
Slide 11: OEM Spotlight
11 Truck Bed Screw Strong Drive® TIMBER Screw Quik Drive® OEM Spotlight Existing line of fasteners and anchors for OEM Truck bed and crating installations using Quik Drive® tool and collated fasteners SOLUTION Racking installation using Titen HD® Anchors Stainless-Steel Titen HD® Anchor
Slide 12: R&R / DIY
12 RATIONALE KEY GOAL STRATEGY • $790 M total addressable market: decks, patios, porches, pergolas, gazebos, fencing and garage organization • Existing product line with potential for several extensions • Established channel/partners • Proven approach with Outdoor Accents • Aligned with the Simpson
Slide 13: R&R / DIY Spotlight
13 R&R / DIY Spotlight SOLUTION Outdoor Accents® decorative hardware – two collections (architectural styles) for building outdoor structures. Mission Collection™ Avant Collection™ Outdoor Accents® hardware used to build pergolas Fastener reset at home center customer New fastener sets include Quik
Slide 14: Mass Timber
14 Mass Timber RATIONALE KEY GOAL STRATEGY • $45 M total addressable market • Strong double digit growth rate in N. America • Positive environmental impact • New market; many product opportunities • Aligned with the Simpson business model Become the engineers’ partner of choice for mass timber conne
Slide 15: Mass Timber Spotlight
15 Mass Timber Spotlight New dedicated line of screws for cross laminated timber (CLT) SDS and SDWS CMSTCBH Simpson products utilized in CLT renovation project at an international airport in North America SOLUTION MDCST48 Simpson products utilized in construction of CLT commercial office building in
Slide 16: Concrete
16 Concrete RATIONALE KEY GOAL STRATEGY • $1.3 B total addressable market • Growth rate linked to infrastructure spend • Simpson is a recognized leader in concrete and cold-formed steel solutions • Many products and applications require engineering, testing and code approval • Aligned with the Simps
Slide 17: Concrete Spotlight
17 Concrete Spotlight SOLUTION Concrete anchor jobsite (above) 44oz. Carbon Fabric A wide range of product solutions for concrete and masonry projects. SET-3G™ Adhesive Heli-Tie™ Helical Stitching Tie Carbon fabric used as fiber-reinforced polymer (FRP) installation on a concrete structure (left) Ti
Slide 18: Structural Steel
18 Structural Steel RATIONALE KEY GOAL STRATEGY • > $770 M total addressable market • Structural steel construction is roughly half of the construction spend in North America • Field welder shortage: addressed by bolted structural connections • Bolted connections can improve productivity by 25% vs.
Slide 19: Structural Steel Spotlight
19 Structural Steel Spotlight Yield-Link® connection for structural steel framing Special moment frame Yield-Link® design used to build education buildings in California (left) and in the construction of 10 recreational/amusement locations across the U.S (below) SOLUTION
Slide 20: Construction Fasteners
20 Be the global market leader in engineered / load-rated construction fastening solutions. Construction Fasteners 5 STRATEGY • Develop critical mass by expanding our engineered fastener business for DIY/R&R, OEM and Mass Timber markets • Provide innovative products that are preferred by both end-us
Slide 21: Customer-Facing Technology Solutions
21 Customer-Facing Technology Solutions • 3D Deck Planner • 3D Pergola Planner • Floor, roof and wall design software • Accurate take-offs • EWP design software • e-commerce • Accurate take-offs • Options management Builders Lumberyards & Distributors Repair & Remodel & DIY Component / Truss Manufac
Slide 22: Strong Business Drives Stockholder Value
22 North America $1,701 Europe $400 Asia/Pacific $15 Wood Construction $1,832 Concrete Construction $282 Strong Business Drives Stockholder Value Our 2022 Sales by Product… ($ USD Millions) and Across Operating Segments ($ USD Millions) $0.87 $1.05 $1.29 $1.38 $1.86 $1.94 $2.72 $2.98 $4.27 $6.12 $7.
Slide 23: Historical Net Sales
23 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 H o u s in g S ta rts (M ) ($ M ) North America Net Sales Total Net Sales Gross Profit Income fr
Slide 24: Operating Income Margin Outperformance
24 19.9% 15.1% 13.2% 6.0% 14.1% 12.3% 9.4% 11.6% 13.3% 13.8% 16.5% 14.2% 16.0% 15.9% 19.9% 23.3% 18.0% - 20.0%(2) 13.7% 5.9% (7.3%) (2.7%) 3.7% 1.1% 3.8% 5.4% 7.8% 9.9% 12.0% 12.6% 11.5% 9.5% 9.6% 12.5% 14.4% (15.0%) (10.0%) (5.0%) 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 2006 2007 2008 2009 2010 201
Slide 25: ROIC Within Top Quartile of Proxy Peers
25 58.2% 29.7% 21.7% 21.1% 20.4% 18.9% 17.6% 15.3% 13.6% 11.8% 11.1% 9.4% 8.2% 7.8% 6.2% ROIC(1) Within Top Quartile of Proxy Peers(2) Source: Company filings as of February 24, 2023. (1) Return on Invested Capital (ROIC) reflects latest fiscal year reported. See appendix for ROIC definition. (2) Pr
Slide 26: Well-Positioned to Drive Growth
26 $160 $206 $208 $151 $400 $29 $33 $33 $44 $62 $2 $7 $8 $6 $811 $40 $40 $40 $42 $44 $111 $61 $76 $24 $79 $182 $141 $157 $116 2018 2019 2020 2021 2022 Cash Generated by Operations Capital Expenditures Acquisitions & Purchases of Intangible Assets Dividends Share Repurchases Well-Positioned to Drive
Slide 27: Capital Return History
27 Quarterly Cash Dividends Capital Return History $774.8 Million 2019 – 2022(1) Cumulative Free Cash Flow defined as: Cash flow from operations ($964.4 M) less Capital expenditures ($189.6 M) 30.9% 21.4% Repurchases of Common Stock (1) Time frame represents January 1, 2019 to December 31, 2022.
Slide 28: Use of Cash Priorities
28 Use of Cash Priorities Cash Flow From Operations Share Repurchases • Evaluating potential M&A in the markets we operate (support key growth initiatives) • Integrating ETANCO remains the priority • Maintain quarterly cash dividends(1) • Consistently and moderately raise dividends • Capital return
Slide 29: Acquisition Strategy
29 Acquisition Strategy • Strengthen our business model by expanding our product lines, end-use markets and developing complete solutions for the markets in which we operate • Improve our market share in our growth initiatives • Improve our manufacturing capabilities and efficiencies to reduce lead-
Slide 30: ETANCO Overview
30 ETANCO is a leading designer, manufacturer and distributor of fixing and fastening solutions for the building construction market in Europe Established in 1952 and headquartered in Le Pecq, France ~900 employees 8 manufacturing and distribution sites across Europe Aligns with Simpson’s
Slide 31: ETANCO Group's Key Products and Applications
31 6 1 2 7 8 4 5 3 9 ETANCO Group’s Key Products and Applications Waterproofing Fixing membrane to avoid water incursion 1 Roofing Fixing metal roof to a building structure 2 Cladding Fixing of protection panels 3 Facade Fixing metal, concrete or stone frameworks for façade backing lining 4 5 Anchor
Slide 32: Sustainability and Environmental and Social Responsibility
32 Sustainability and Environmental and Social Responsibility “Our people are the most vital part of our business, and providing a safe, healthy, sustainable, and rewarding working environment is of fundamental importance.” – Karen Colonias (retired CEO) • Issued inaugural ESG report in March 2020 •
Slide 33: 5-Year Company Ambitions
33 5-Year Company Ambitions Strengthen our values-based culture Be the partner of choice Be an innovation leader in the markets we operate Continue above market growth rate relative to U.S. housing starts Continue expanding our operating income margin to remain within the top quartile of proxy peers
Slide 34: Appendix
34 Appendix
Slide 35: A Pioneer in Construction Solutions
35 A Pioneer in Construction Solutions 1956 1970 1984 1996 1997 1999 2005 Simpson structural connectors are the industry standard. 1994 NYSE LISTING (SSD) OUR FOUNDER BARC SIMPSON EXPANSION INTO CONCRETE EXPANSION INTO FASTENERS FIRST CONNECTOR CONNECTOR MARKET LEADER EXPANSION INTO WOOD SHEAR WALLS
Slide 36: A Pioneer in Construction Solutions (Continued)
36 A Pioneer in Construction Solutions (Continued) Simpson is an innovation leader in fasteners, concrete repair, moment frames, construction software and structural steel solutions. 2011 2013 2016 20192012 2008 2009 20202017 EXPANSION INTO SS FASTENERS EXPANSION INTO ORDINARY MOMENT FRAMES FURTHER
Slide 37: Commitment to Innovation: State-of-the-Art Test Labs
37 Commitment to Innovation: State-of-the-Art Test Labs We are dedicated to research, testing, engineering and innovation through our state-of-the-art test labs, which provides us with a better understanding of how structures perform, advances our design technology and improves building safety. WOOD
Slide 38: Return on Invested Capital (ROIC) Definition
38 Return on Invested Capital (“ROIC”) Definition When referred to in this presentation, return on invested capital (“ROIC”) for a fiscal year is calculated based on (i) the net income of that year as presented in the Company’s consolidated statements of operations prepared pursuant to generally acc
Slide 39: Strong Foundation. Stronger Future.
STRONG FOUNDATION. STRONGER FUTURE.