Matthews International Corporation · NASDAQ:MATW
Matthews International — Q4 2022 Earnings Presentation
44 slides from Matthews International's earnings presentation, Dec 2, 2022
Slide 1: Investor Presentation Fourth Quarter Fiscal Year 2022
INVESTOR PRESENTATION FOURTH QUARTER FISCAL YEAR 2022 www.matw.com | Nasdaq: MATW
Slide 2: Disclaimer
© 2022 Matthews International Corporation. All Rights Reserved. 2 DISCLAIMER Any forward-looking statements contained in this presentation are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and
Slide 3: © 2022 Matthews International Corporation. All Rights Reserved. 3
© 2022 Matthews International Corporation. All Rights Reserved. 3
Slide 4: Matthews at a Glance - $1.76B FY2022 Revenue
© 2022 Matthews International Corporation. All Rights Reserved. 4 MATTHEWS AT A GLANCE - $1.76B FY2022 REVENUE 33% 48% 19% Europe 25% Asia & Pacific 5% Americas 70% Note: Effective in the first quarter of fiscal 2022, the Company transferred its surfaces and engineered products businesses from the S
Slide 5: Engineered Solutions: Product Identification, Warehouse Automation
© 2022 Matthews International Corporation. All Rights Reserved.© 2022 Matthews International Corporation. All Rights Reserved. ENGINEERED SOLUTIONS PRODUCT IDENTIFICATION WAREHOUSE AUTOMATION
Slide 6: Industrial Technologies Products and Markets
© 2022 Matthews International Corporation. All Rights Reserved. 6 INDUSTRIAL TECHNOLOGIES PRODUCTS AND MARKETS PRINCIPAL PRODUCT LINES COMPETITIVE ADVANTAGES
Slide 7: Energy Storage Solutions
© 2022 Matthews International Corporation. All Rights Reserved. 7 ENERGY STORAGE SOLUTIONS • Matthews Saueressig subsidiary has been working to apply advanced calendering patented IP and knowledge to the manufacturing of lithium-ion and embossing plates used in fuel cells • Saueressig currently deli
Slide 8: Position Strengthened with Inflation Reduction Act
© 2022 Matthews International Corporation. All Rights Reserved. 8 POSITION STRENGTHENED WITH INFLATION REDUCTION ACT • Projections on incremental Gigawatt hour (GWh) installed for U.S. by 2030 was over 600 GWh prior to the Inflation Reduction Act • Expect this number to be significantly higher based
Slide 9: Energy Opportunities Reach Beyond EV
© 2022 Matthews International Corporation. All Rights Reserved. 9 ENERGY OPPORTUNITIES REACH BEYOND EV Source: Business Strategic Plan (Management Estimate)
Slide 10: Warehouse Automation
© 2022 Matthews International Corporation. All Rights Reserved. 10 WAREHOUSE AUTOMATION • Warehouse Automation systems complement the tracking and distribution of a customer's products with automated order fulfillment technologies and controls for material handling systems • Material handling custom
Slide 11: Warehouse Automation Expansion Potential
© 2022 Matthews International Corporation. All Rights Reserved. 11 WAREHOUSE AUTOMATION EXPANSION POTENTIAL • Expand configurability and web interface for information everywhere • Continued growth in e-commerce solutions • Warehouse automation market continues to grow in demand from both greenfield
Slide 12: Product Identification
© 2022 Matthews International Corporation. All Rights Reserved. 12 PRODUCT IDENTIFICATION • Product identification dates back to Matthews’ original branding irons and hand stamps from the 1850s • Matthews identified a significant market opportunity to displace incumbent continuous inkjet (CIJ) techn
Slide 13: New Printhead Technology Drives Additional Demand
© 2022 Matthews International Corporation. All Rights Reserved. 13 NEW PRINTHEAD TECHNOLOGY DRIVES ADDITIONAL DEMAND • Technology miniaturizes valves the same way a transistor miniaturized switches • Business development evaluating additional opportunities in adjacent markets • Reduces VOC emissions
Slide 14: Memorialization: Cemetery, Funeral Home, Cremation Products
© 2022 Matthews International Corporation. All Rights Reserved.© 2022 Matthews International Corporation. All Rights Reserved. CEMETERY PRODUCTS FUNERAL HOME PRODUCTS CREMATION PRODUCTS AND EQUIPMENT tt s I t r ti l r r ti . ll i ts s rv .
Slide 15: Market Leadership
© 2022 Matthews International Corporation. All Rights Reserved. Cemetery Products Bronze Memorials - #1 Granite Memorials - #1 North America, Italy, Australia 15 Funeral Home Products Caskets - #2 United States Cremation and Incineration Equipment Cremation Equipment - #1 Global Market Position (U.S
Slide 16: Leading Market Position
© 2022 Matthews International Corporation. All Rights Reserved. LEADING MARKET POSITION 16 MEMORIALIZATION MARKET POSITION * Company estimates based on industry reports for fiscal year 2022 MARKET POSITIONS (U.S.) Bronze Memorials Granite Memorials Caskets Cremation Equipment COMPETITIVE ADVANTAGE
Slide 17: Stability in Memorialization with Growth Potential
© 2022 Matthews International Corporation. All Rights Reserved. 17 Note: All financial figures reflect fiscal years ended September 30th. 1 Internal estimates based upon data compiled from CDC, US Census Bureau and Industry reports; 2 Includes incineration products CASKETED VS. NON-CASKETED DEATHS 1
Slide 18: Strategic Growth Opportunities
© 2022 Matthews International Corporation. All Rights Reserved. 18 STABILITY IN MEMORIALIZATION WITH GROWTH POTENTIAL STRATEGIC GROWTH OPPORTUNITIES • Cremation products • Online solutions • Technology services – software as a service • Complimentary new products to funeral homes / cemeteries • 3D p
Slide 19: SGK Brand Solutions
© 2022 Matthews International Corporation. All Rights Reserved.© 2022 Matthews International Corporation. All Rights Reserved.
Slide 20: Core Packaging Services
© 2022 Matthews International Corporation. All Rights Reserved. 20 CORE PACKAGING SERVICES CORE PACKAGING SERVICES SGK’s packaging solutions can be purchased as an integrated, end to end solution or as stand-alone services.
Slide 21: Brand Experience Solutions
© 2022 Matthews International Corporation. All Rights Reserved. 21 CORE PACKAGING SERVICES BRAND EXPERIENCE SOLUTIONS Tailored solutions for brand commerce and brand activation that deliver more connected and enriching experiences between brand and consumer
Slide 22: SGK Brand Solutions
© 2022 Matthews International Corporation. All Rights Reserved. SGK BRAND SOLUTIONS FOOD/BEVERAGE CLIENTS GLOBAL PHARMA / HEALTHCARE CLIENTS GLOBAL RETAILER CLIENTS OTHER LEADING BRANDS 22 • Longstanding relationships with a large, blue chip customer base consisting of many Fortune 100 and Fortune 5
Slide 23: SGK's Strategic Initiatives Extend Revenue Opportunity
© 2022 Matthews International Corporation. All Rights Reserved. SGK's STRATEGIC INITIATIVES 23 EXTEND REVENUE OPPORTUNITY WITHIN THE CORE PACKAGING BUSINESS • Improving focus and messaging in the marketplace • Redesigning, rebranding and bundling products and services • Continued focus on ESG throug
Slide 24: SGK Technology Continues to Drive Growth
© 2022 Matthews International Corporation. All Rights Reserved. SGK TECHNOLOGY CONTINUES TO DRIVE GROWTH 24
Slide 25: Investment Thesis
© 2022 Matthews International Corporation. All Rights Reserved. 25 INVESTMENT THESIS
Slide 26: Key Highlights
© 2022 Matthews International Corporation. All Rights Reserved. 26 GROWTH OPPORTUNITIES SUPPORTED BY STABLE CORE BUSINESSES DISCIPLINED TRACK RECORD OF ACQUISITIONS AND INTEGRATION ROBUST CASH FLOW AND LOW LEVERAGE SUPPORTING DISCIPLINED FINANCIAL POLICY FAVORABLE COMPETITIVE POSITIONS IN ATTRACTIVE
Slide 27: Attractive Markets and Growth Opportunities
© 2022 Matthews International Corporation. All Rights Reserved. B CA Attractive markets and growth opportunities • Stable demand driven by increased deaths as a result of population growth • Strong presence and growing revenue in cremation products and equipment • Investment in innovations to drive
Slide 28: Stable Core Businesses Support Growth Opportunities
© 2022 Matthews International Corporation. All Rights Reserved. 28 STABLE CORE BUSINESSES SUPPORT GROWTH OPPORTUNITIES STABLE CORE BUSINESSES GROWTH OPPORTUNITIES • Industrial Technologies • Core product line in product identification equipment and consumables • Memorialization – Demographic (death
Slide 29: Disciplined Track Record of Acquisitions and Integration
© 2022 Matthews International Corporation. All Rights Reserved. 29 3 DISCIPLINED TRACK RECORD OF ACQUISITIONS AND INTEGRATION • Identify and integrate complementary businesses with an insistence on prudent capital deployment • Focus on complementary geographies, vertical integration or additional te
Slide 30: Robust Cash Flow and Low Leverage
© 2022 Matthews International Corporation. All Rights Reserved. 30 Note: All figures reflect fiscal years ended September 30th; Historical FY1994 – FY2018 reflect amounts as reported in the Company's 10-K filings for those fiscal years. See Disclaimer (Page 2) for Management’s assessment of suppleme
Slide 31: Strong and Experienced Management Team
© 2022 Matthews International Corporation. All Rights Reserved. 31 5 STRONG AND EXPERIENCED MANAGEMENT TEAM Joseph Bartolacci Chief Executive Officer and President Greg Babe Chief Technology Officer Lee Lane Group President of Industrial Automation and Environmental Solutions Steven Gackenbach Group
Slide 32: Financial Overview
© 2022 Matthews International Corporation. All Rights Reserved. 32 FINANCIAL OVERVIEW
Slide 33: Debt Reduction and Growth
© 2022 Matthews International Corporation. All Rights Reserved. 33 DEBT REDUCTION • Historically maintained a modest leverage profile • Publicly stated Net Debt Leverage Ratio (1) target of 3.0x or less • Continued debt reduction, balanced growth and share repurchase • Approximately $167mm of debt r
Slide 34: Sales and Adjusted EBITDA by Segment
© 2022 Matthews International Corporation. All Rights Reserved. 34 (Dollars in thousands) Fiscal Year Ended September 30, 2020 2021 2022 Sales: Memorialization $ 656,035 $ 769,016 $ 840,124 Industrial Technologies 228,453 284,495 335,523 SGK Brand Solutions 613,818 617,519 586,756 Consolidated Sales
Slide 35: ESG Overview
© 2022 Matthews International Corporation. All Rights Reserved. 35 ESG OVERVIEW
Slide 36: Business Solutions to Drive Efficiency and Environmental Performance
© 2022 Matthews International Corporation. All Rights Reserved. 36 BUSINESS SOLUTIONS TO DRIVE EFFICIENCY AND ENVIRONMENTAL PERFORMANCE • Provider of Energy storage solutions including battery production technology for electric vehicles • Waste-to-Energy solutions with projects in UK and Europe • Cr
Slide 37: Appendix
© 2022 Matthews International Corporation. All Rights Reserved. 37 APPENDIX
Slide 38: Constant Currency Sales Non-GAAP Reconciliation
© 2022 Matthews International Corporation. All Rights Reserved. * See Disclaimer (page 2) for Management’s assessment of supplemental information related to constant currency sales. 38 CONSTANT CURRENCY SALES NON-GAAP RECONCILIATION (Unaudited) (In thousands) Memorialization Industrial Technologies
Slide 39: Total Adjusted EBITDA Non-GAAP Reconciliation
© 2022 Matthews International Corporation. All Rights Reserved. TOTAL ADJUSTED EBITDA NON-GAAP RECONCILIATION (Unaudited) * See Disclaimer (page 2) for Management’s assessment of supplemental information related to adjusted EBITDA. 39 (In thousands, except per share data) Fiscal Year Ended September
Slide 40: Adjusted Net Income and Earnings Per Share Non-GAAP Reconciliation
© 2022 Matthews International Corporation. All Rights Reserved. ADJUSTED NET INCOME AND EARNINGS PER SHARE NON-GAAP RECONCILIATION (Unaudited) * See Disclaimer (page 2) for Management’s assessment of supplemental information related to adjusted net income and adjusted EPS. 40 (In thousands, except p
Slide 41: Net Debt and Net Debt Leverage Ratio
© 2022 Matthews International Corporation. All Rights Reserved. 41 (Dollars in thousands) Fiscal Year Ended September 30, (unaudited) 2020 2021 2022 Long-term debt, current maturities $ 26,824 $ 4,624 $ 3,277 Long-term debt 807,710 759,086 795,291 Total long-term debt 834,534 763,710 798,568 Less: C
Slide 42: Free Cash Flow
© 2022 Matthews International Corporation. All Rights Reserved. 42 (Dollars in thousands) Fiscal Year Ended September 30, 2020 2021 2022 Cash Provided from Operating Activities $ 180,447 $ 162,811 $ 126,860 Less: Capital Expenditures (34,849) (34,313) (61,321) Free Cash Flow $ 145,598 $ 128,498 $ 65
Slide 43: Institutional Shareholders
© 2022 Matthews International Corporation. All Rights Reserved. 43 Shares September 30, 2022 BlackRock, Inc. 4,966,753 The Vanguard Group, Inc. 3,470,115 Phoenix Holdings Ltd. 1,809,178 Dimensional Fund Advisors, L.P. 1,530,530 Gamco Investors, Inc. et al 1,136,500 Ameriprise Financial, Inc. 1,116,5
Slide 44: © 2022 Matthews International Corporation. All Rights Reserved.
© 2022 Matthews International Corporation. All Rights Reserved.
Matthews International — Q4 2022 Earnings Presentation on 6ix