A.o. Smith Corporation · NYSE:AOS
A.o. Smith — Q1 2024 Earnings Presentation
15 slides from A.o. Smith's earnings presentation, Apr 25, 2024
Slide 1: First Quarter 2024 Results
First Quarter 2024 Results April 25, 2024 1st Quarter 2024 Earnings Presentation | 1
Slide 2: Presenters
Kevin J. Wheeler Charles T. Lauber Helen E. Gurholt Chairman and Executive Vice President Vice President - Investor Relations, Chief Executive Officer and Chief Financial Officer Financial Planning & Analysis 1st Quarter 2024 Earnings Presentation | 2
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements generally can be identified by the use of words such as “may,” “will,” “expect,” “
Slide 4: First Quarter Messages
First Quarter Messages 1 2 3 4 5 Strong sales of Higher North North America China achieved India achieved $979M and EPS America sales segment margin third-party local local currency of $1.00 due to positive of 25.9% driven currency sales sales growth of mix toward high by positive mix growth of 6% 1
Slide 5: First Quarter Performance and Highlights
First Quarter Performance and Highlights Sales Adjusted EPS Segment Sales Adjusted Segment Earnings $979 $1.00 $766M $0.94 $199M $966 1% 6% YOY YOY $227M $17M Q1 2023 Q1 2024 Q1 2023 Q1 2024 North America Rest of World North America Rest of World Highlights North America Rest of World • Net sales up
Slide 6: First Quarter North America Segment
First Quarter North America Segment Segment Sales ($M) Segment Operating Earnings ($M) 2% YOY 25.1% 25.9% • Sales increase primarily due to higher commercial volumes and • Earnings increase driven by positive mix and lower material costs favorable mix in water heaters toward high efficiency products
Slide 7: First Quarter Rest of World Segment
First Quarter Rest of World Segment Segment Sales ($M) Adjusted Segment Operating Earnings ($M) 4% YOY 8.1% 7.6% • China sales grew 6% driven by kitchen appliance and HVAC sales • Earnings benefits from higher volumes of kitchen products in China • Includes inter-segment sales associated with gas-ta
Slide 8: Cash Flow and Liquidity
Cash Flow and Liquidity1 $303M Free Cash Flow ($M) Cash Flow From Operations ($M) Cash balance2 $120 $107 $109 6.0% Debt to capital ratio $85 $183M Net cash position ~906K 2023 2024 2023 2024 Shares repurchased in 2024 totaling ~$75M 1As of March 31, 2024 2Includes cash, cash equivalents and marketa
Slide 9: Capital Allocation Priorities
Capital Allocation Priorities Organic Growth • Opportunities for organic growth in all our businesses and geographies • Disciplined focus on transactions that expand/grow the core, enable geographic growth, and establish adjacencies Acquisitions • Recent transactions include Impact Water and Water T
Slide 10: 2024 Outlook and Assumptions
2024 Outlook and Assumptions1 Revenue Increase ~3% to 5% 2024 Guidance 2023 U.S. Residential Water Heater Industry Flat Commercial Water Heater Industry + LSD China Sales Growth (Local Currency) ~Flat to 3% Diluted EPS (GAAP) $3.90 - $4.15 $3.69 North American Boiler Sales Growth ~8% to 10% North Am
Slide 11: Powerful Investment Thesis
Powerful Investment Thesis 1 2 3 4 5 Leading with Capitalizing Leading Compelling Leveraging strong innovative on global North American brand awareness balance sheet for products megatrends in a water heater and in emerging organic that drive large and growing boiler producer markets with and inorga
Slide 12: A. O. Smith. Innovation has a name.
(<6 Smith. Innovation has a name.
Slide 13: Adjusted Earnings and Adjusted EPS
Adjusted Earnings and Adjusted EPS ($ in Millions, except per share data) (1) Earnings (loss) per share amounts are calculated discretely and, therefore, may not add up to the total due to rounding. 1st Quarter 2024 Earnings Presentation | 13
Slide 14: Adjusted Segment Earnings
Adjusted Segment Earnings ($ in Millions) 1st Quarter 2024 Earnings Presentation | 14
Slide 15: Free Cash Flow
Free Cash Flow ($ in Millions) 1st Quarter 2024 Earnings Presentation | 15