Jeld-wen Holding, Inc. · NYSE:JELD
Jeld-wen — Q3 2024 Earnings Presentation
35 slides from Jeld-wen's earnings presentation, Nov 5, 2024
Slide 1: Third Quarter 2024 Results
Third Quarter 2024 Results November 5, 2024
Slide 2: Speakers
Speakers Bill Christensen CEO Samantha Stoddard CFO
Slide 3: Disclosures
Disclosures Certain statements in this presentation, including our guidance and business strategies, are forward- looking statements that involve risk, uncertainty and assumptions, and are based on information as of November 5, 2024. Actual results may differ materially from those set forth in such
Slide 4: Third Quarter 2024 Highlights
Third Quarter 2024 Highlights Third Quarter 2024 ▪ Sales of $935 million ▪ Adjusted EBITDA of $82 million – 8.7% of Sales ▪ Mix headwinds worse than anticipated ▪ Transformation journey measures on track ▪ Announced plans to close facilities in Alabama and Denmark and optimize UK production DELIVERI
Slide 5: Q3 2024 Financial Results
Q3 2024 Financial Results
Slide 6: Q3 2024 Financial Summary
Q3 2024 Financial Summary USD in Millions Net Revenue Adjusted EBITDA Adjusted EBITDA Margin -110 bps -13% -23% $1,077 $106 9.8% $935 8.7% $82 Q3 2023 Q3 2024 Q3 2023 Q3 2024 Q3 2023 Q3 2024 Core Revenue down (13%) driven Productivity & SG&A improvements more than by lower volume / mix offset by low
Slide 7: Q3 2024 Revenue Bridge
Q3 2024 Revenue Bridge USD in Millions $1,077 ($2) $2 $935 ($143) Core Revenue (13%) Q3 2023 Price Volume / Mix Foreign Exchange Q3 2024 Note: Amounts do not foot due to rounding LOWER VOLUME / MIX FROM PERSISTING MARKET HEADWINDS 7
Slide 8: Q3 2024 Adjusted EBITDA Bridge
Q3 2024 Adjusted EBITDA Bridge USD in Millions $106 ($17) $19 $82 $17 ($43) Adj. Margin Adj. Margin 9.8% 8.7% Q3 2023 Price / Cost Volume / Mix Productivity SG&A / Other Income Q3 2024 TRANSFORMATION SAVINGS PARTIALLY MITIGATES LOWER VOLUME / MIX 8
Slide 9: Q3 2024 Segment Results
Q3 2024 Segment Results USD in Millions Q3 2023 Q2 2024 Segment Highlights North America Q3 2024 (Prior Year) (Previous Quarter) Net Revenue $678 $790 $711 ▪ Lower volume / mix Adjusted EBITDA $75 $100 $76 - North America down (14%) Adjusted EBITDA margin 11.0% 12.6% 10.6% driven by ~60% mix, ~40% v
Slide 10: Market Outlook
Market Outlook North America Europe Low Double-Digit Low Double-Digit Volume Decline Volume Decline New single-family construction Residential construction Up low single-digits High single-digit decline Repair & Remodel Commercial projects Down mid-to-high single-digits Low double-digit decline Mult
Slide 11: Transformation Journey
Transformation Journey
Slide 12: Key Levers
Key Levers People Performance Culture & Growth Cost Capabilities ▪ Safety-first mindset ▪ Increase salesforce ▪ Invest in process ▪ Improve organizational efficiency automation health ▪ Upgrade go-to-market ▪ Consolidate footprint ▪ Align accountability process ▪ Utilize scale and and incentives ▪ O
Slide 13: Transformation: Special Order Focus at Retail
Transformation: Special Order Focus at Retail Leveraging JELD-WEN’s Network 5-year Expected Cumulative Financial Impact ✓ Simplified door configuration process >$5 Million ✓ Updated product assortment meets current design, EBITDA Benefit color and glass trends <$2 Million ✓ Refreshing store displays
Slide 14: Performance: UK Manufacturing Transformation
Performance: UK Manufacturing Transformation Unlocking Latent Capacity and Leveraging Our Key Assets 5-year Expected Cumulative Financial Impact ✓ Penrith, UK – Best in class door slab manufacturing site ▪ Adding capacity (3rd line) >$2 Million EBITDA Benefit ✓ Rebalancing UK network <$1 Million ✓ N
Slide 15: Our Transformation is Working
Our Transformation is Working Adjusted EBITDA; USD in Millions $15 $115 $50 $50 2023 Carryover New Projects SG&A Reductions Total Cost Savings OPTIMIZING JELD-WEN FOR FUTURE GROWTH 15
Slide 16: 2024 Guidance
2024 Guidance
Slide 17: Updated 2024 Guidance
Updated 2024 Guidance Previous Current Net Revenue Net Revenue $3.9B to $4.1B $3.7B to $3.75B Core Revenue Core Revenue Down (5%) to (9%) Down (13%) to (14%) Adjusted EBITDA Adjusted EBITDA $340M to $380M $265M to $280M VOLUME/MIX HEADWINDS DRIVING NEAR-TERM WEAKNESS 17
Slide 18: Updated 2024 Cash Flow Outlook
Updated 2024 Cash Flow Outlook* Previous Current Operating Cash Flow Operating Cash Flow ~$200M ~$125M Cap Ex Cap Ex $150M to $175M $150M to $175M Free Cash Flow Free Cash Flow $25M to $50M ($25M) to ($50M) *Includes ~$100 million of non-recurring transformation journey cash expenses. Lower Adjusted
Slide 19: Transformation Partially Offsetting Significant Headwinds
Transformation Partially Offsetting Significant Headwinds Adjusted EBITDA; USD in Millions $380 $115 $273 ($182) $158 ($40) FY 2023 Volume / Mix Price / Cost Adj. EBITDA w/o Transformation FY 2024 Transformation Savings Midpoint TRANSFORMATION IS WORKING 19
Slide 20: Transformation Guidance
Transformation Guidance 2025 Transformation Impact ✓ $100 million of additional Adjusted EBITDA from Transformation Projects ✓ Capital investments of approximately $175 million to $200 million ✓ 25% to 30% incremental margin as market volumes improve ✓ Continued footprint actions to right-size netwo
Slide 21: JELD-WEN Going Forward
JELD-WEN Going Forward Address Reposition Improve Capital Priorities Transparency Allocation UNLOCKING SIGNIFICANT SHAREHOLDER VALUE 21
Slide 22: Appendix
Appendix
Slide 23: Net Revenue Walk
Net Revenue Walk Q3 2024 JELD-WEN North America Europe Price -% -% -% Volume / Mix (13%) (14%) (12%) Core Revenue Growth (13%) (14%) (12%) FX -% -% 1% Total (13.2%) (14.2%) (10.4%) 23
Slide 24: Key Assumptions for 2024
Key Assumptions for 2024 USD in Millions Key Assumption 2024 Estimate Depreciation and Amortization ~$130 Interest Expense, net $65 to $70 Tax Rate (Adjusted Earnings) ~27% Diluted Share Count ~86 million ✓ Full-year EBITDA split ~55% in 1H ✓ Price / Cost (~1%) versus 2023 ✓ Foreign exchange transla
Slide 25: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow USD in Millions Cash Flow(1) Q3 2024 Q3 2023 Net cash provided by operating activities $78 $273 Capital Expenditures(2) ($118) ($80) Free Cash Flow(3) ($40) $193 Balance Sheet(4) September 28, 2024 December 31, 2023 Total Debt $1,211 $1,226 Cash $208 $288 Net Debt(5) $1,0
Slide 26: Q3 YTD 2024 Revenue Bridge
Q3 YTD 2024 Revenue Bridge USD in Millions $3,283 $1 $3 $2,880 ($408) Core Revenue (12%) YTD 2023 Price Volume / Mix Foreign Exchange YTD 2024 Note: Amounts do not foot due to rounding LOWER VOLUME / MIX REFLECTS MARKET HEADWINDS 26
Slide 27: Q3 YTD 2024 Adjusted EBITDA Bridge
Q3 YTD 2024 Adjusted EBITDA Bridge USD in Millions $294 ($31) $50 $235 $45 ($123) Adj. Margin Adj. Margin 9.0% 8.2% YTD 2023 Price / Cost Volume / Mix Productivity SG&A / Other Income YTD 2024 PRODUCTIVITY / SG&A PARTIALLY MITIGATES LOWER VOLUME / MIX 27
Slide 28: Q3 2024 and Q3 2023 Adjusted Net Income Reconciliation
Q3 2024 and Q3 2023 Adjusted Net Income Reconciliation USD in Millions Three Months Ended Nine Months Ended September 28, 2024 September 30, 2023 September 28, 2024 September 30, 2023 (Loss) income from continuing operations, net of tax $ (73.0) $ 16.9 $ (119.2) $ 47.9 Special items:(1) Net legal an
Slide 29: Q3 2024 and Q3 2023 Adjusted Net Income Per Share Reconciliation
Q3 2024 and Q3 2023 Adjusted Net Income Per Share Reconciliation Three Months Ended Nine Months Ended September 28, 2024 September 30, 2023 September 28, 2024 September 30, 2023 Diluted (loss) income per share from continuing operations $ (0.86) $ 0.20 $ (1.40) $ 0.56 Impact of additional dilutive s
Slide 30: Adjusted EBITDA From Continuing Operations Reconciliation
Adjusted EBITDA From Continuing Operations Reconciliation USD in Millions Three Months Ended Nine Months Ended September 28, 2024 September 30, 2023 September 28, 2024 September 30, 2023 (Loss) income from continuing operations, net of tax $ (73.0) $ 16.9 $ (119.2) $ 47.9 Income tax expense 7.3 17.4
Slide 31: Q3 2024 QTD Segment Adjusted EBITDA Reconciliation
Q3 2024 QTD Segment Adjusted EBITDA Reconciliation USD in Millions Three Months Ended September 28, 2024 Corporate North and Total Europe America Unallocated Consolidated Costs Income (loss) from continuing operations, net of tax $ 35.8 $ (66.7) $ (42.1) $ (73.0) Income tax expense (benefit) 6.5 2.6
Slide 32: Q3 2023 QTD Segment Adjusted EBITDA Reconciliation
Q3 2023 QTD Segment Adjusted EBITDA Reconciliation USD in Millions Three Months Ended September 30, 2023 Corporate North and Total Europe America Unallocated Consolidated Costs Income (loss) from continuing operations, net of tax $ 40.5 $ 10.7 $ (34.2) $ 16.9 Income tax expense (benefit) 27.4 6.0 (1
Slide 33: Q2 2024 Segment Adjusted EBITDA Reconciliation
Q2 2024 Segment Adjusted EBITDA Reconciliation USD in Millions Three Months Ended June 29, 2024 Corporate North and Total Europe America Unallocated Consolidated Costs Income (loss) from continuing operations, net of tax $ 30.7 $ (5.0) $ (44.2) $ (18.5) Income tax expense (benefit) 12.9 10.3 (13.7)
Slide 34: Q3 2024 YTD Segment Adjusted EBITDA Reconciliation
Q3 2024 YTD Segment Adjusted EBITDA Reconciliation USD in Millions Nine Months Ended September 28, 2024 Corporate North and Total Europe America Unallocated Consolidated Costs Income (loss) from continuing operations, net of tax $ 82.8 $ (71.7) $ (130.3) $ (119.2) Income tax expense (benefit) 26.8 1
Slide 35: Q3 2023 YTD Segment Adjusted EBITDA Reconciliation
Q3 2023 YTD Segment Adjusted EBITDA Reconciliation USD in Millions Nine Months Ended September 30, 2023 Corporate North and Total Europe America Unallocated Consolidated Costs Income (loss) from continuing operations, net of tax $ 127.0 $ 28.6 $ (107.7) $ 47.9 Income tax expense (benefit) 63.1 10.5