Brightview Holdings, Inc. · NYSE:BV
Brightview — Q3 2022 Earnings Presentation
29 slides from Brightview's earnings presentation, Aug 4, 2022
Slide 1: Q3 Fiscal 2022 Earnings Call
Q3 Fiscal 2022 Earnings Call NYSE: BV August 4th, 2022
Slide 2: Introductory Information: Forward-Looking Statements
Introductory Information Forward-Looking Statements This presentation contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 that involve substantial risks and uncertainties. All statemen
Slide 3: Quarter Highlights and Business Update
Quarter Highlights and Business Update Andrew Masterman | President and Chief Executive Officer 3Q FY2022 Earnings Presentation | 3
Slide 4: 3Q FY 2022 Highlights
3Q FY 2022 Highlights REVENUE STRONG-ON-STRONG M&A • Delivered total organic growth of 5.6% • Expanding into new markets to continue to drive our growth • Maintenance 3.1% organic growth with Maintenance Land organic growth of 2.3% • M&A revenue contribution of $36 million for Q3 and $113 million ye
Slide 5: Strategic investments drive momentum
Strategic investments drive momentum Dedicated, locally-based Investing in 200+ person business salesforce to generate new development team solely focused sales on securing new customers Strategic technology ~3% Driving differentiated value investments, digital Market Share proposition to attract an
Slide 6: Gaining market share and significantly outpacing industry growth in 2022
Gaining market share and significantly outpacing industry growth in 2022 BrightView total addressable market of $100B: $66B in land, $17B in snow, and $17B in development Projected industry land market growth of 0.9% for 2022, BV expected land organic of 4% to 5% and total land of ~8% BrightView gro
Slide 7: Technology and digital transformation
Technology and digital transformation Strategic Technology Key Solutions Objectives Customer Acquisition & • BV Connect 2.0 Engagement • Salesforce CRM Platform • QSA 2.0 Expanding Ancillary • Service Confirmation Opportunities • Fuel / Equipment Utilization Operational Efficiencies • Labor Analytic
Slide 8: Strong-on-strong acquisition success
Strong-on-strong acquisition success 2017 2018 2019 2020 2021 2022 Anaheim, CA Austin, TX Honolulu, HI Plymouth, MN Fresno, CA Ringwood, NJ Portland, OR Bay Area, CA Vista, CA Las Vegs, NV San Jose, CA Phoenix, AZ Dallas, TX Salt Lake City, UT & Boise, ID Fort Lauderdale, FL Norcross, GA Sanford, FL
Slide 9: Managing external inflationary headwinds
Managing external inflationary headwinds Material Cost Inflation Wage Inflation Rising Fuel Costs • Primarily impacts profitability of • 6% to 7% wage increase compared • Primarily impacts profitability of development business, due to to 4% to 5% historically maintenance business pricing commitments
Slide 10: Positioned for long-term profitable growth
Positioned for long-term profitable growth Operate in a resilient and durable industry; withstood various economic cycles Serve marquee customers across a diverse array of end-markets Offer a differentiated customer value proposition, powered by technology, sustainability and a network of expertise
Slide 11: Partnering with customers to reduce water usage
Partnering with customers to reduce water usage Water Management & Irrigation ENVIRONMENTAL SOCIAL • Provide water-efficient landscaping services and partner with customers to reduce water usage • Mix of smart irrigation strategy and technologies as well as client education contribute to water effic
Slide 12: Financial Review and Outlook
Financial Review and Outlook John Feenan | EVP and Chief Financial Officer 3Q FY2022 Earnings Presentation | 12
Slide 13: Introduction
Introduction Brett Urban| Incoming Chief Financial Officer 3Q FY2022 Earnings Presentation | 13
Slide 14: 3Q FY2022 Revenue
3Q FY2022 Revenue (Numbers $M) 3Q22 3Q21 Commentary • 11.0% Increase Total Revenue $747.4 $673.6 • 5.6% Total Organic Growth • M&A contribution of $36M • 7.1% Increase Maintenance Services $561.8 $524.6 • 3.1% Maintenance Organic Growth & $20.8M M&A • 5.3% Increase Maintenance - Land $548.9 $521.2 •
Slide 15: 3Q FY2022 Adjusted EBITDA
3Q FY2022 Adjusted EBITDA (Numbers $M)sur 3Q22 3Q21 Commentary • 0.7% Increase Total Adjusted EBITDA $94.3 $93.6 • 12.6% Adjusted EBITDA margin • 130 bp contraction; primarily impacted by fuel • (1.5)% Decrease Maintenance Services $89.2 $90.6 • 15.9% Adjusted EBITDA margin • 140 bp contraction • 11
Slide 16: FY22 Development EBITDA Margin Progression
FY22 Development EBITDA Margin Progression Year to Year EBITDA Margin Change (Bps) 80 Prior Year Margin EBITDA Margin Accretive Baseline Position -120 -130 -300 1Q'22 2Q'22 3Q'22 4Q'22 (Est) Margin Pressures Subsiding, Poised for Expansion Despite Fuel Headwind 3Q FY2022 Earnings Presentation | 16
Slide 17: 3Q FY2022 Additional Highlights
3Q FY2022 Additional Highlights Disciplined management of corporate expenses Interest expense impacted by increased interest rates Adjusted Earnings per Share of $0.43 per share benefited from share repurchases, strong topline and operational efficiencies 3Q FY2022 Earnings Presentation | 17
Slide 18: Net CapEx, Net Debt and Liquidity
Net CapEx, Net Debt and Liquidity 1 2 3 Net Capital Net Debt Liquidity Expenditures $1,368.6 $1,259.1 $403.2 $350.3 $23.9 $16.8 $2.8 1 $4.1 $21.1 $12.7 3Q'21 3Q'22 2Q'22 3Q'22 3Q'21 3Q'22 Net Capex Asset Disposals Net CapEx / Total Revenue Net Debt / TTM Adjusted EBITDA Liquidity Timing Due to Suppl
Slide 19: Expect Significant Improvement in Q4 Free Cash Flow
Expect Significant Improvement in Q4 Free Cash Flow Q3YTD Free Cash Flow impacted by timing of capital expenditures and CARES Act related tax payments Expect Q4 Free Cash Flow to significantly improve relative to prior year; 2H2022 Free Cash Flow results in line or modestly ahead of 2H2021 Expect ro
Slide 20: Liquidity Update
Liquidity Update $(M) As of As of 6/30/2021 6/30/2022 Revolving Credit Facility Availability $207.7 $250.9 Receivables Financing Agreement 70.5 73.2 Total Credit Available $278.2 $324.0 Cash and Cash Equivalents 125.0 26.3 Total Liquidity $403.2 $350.3 Debt Maturities: ➢ Revolving Credit Facility ➢
Slide 21: BV Q4FY22 Financial Guidance
BV Q4FY22 Financial Guidance1 Previous Current As of 05.05.22 Q4FY22 Q4FY22 Revenue $711M - $731M $711M - $731M Adj. EBITDA $88M - $94M $94M - $100M Adj. EBITDA Margin Midpoint:12.6% Midpoint: 13.5% Q4 Revenue Drivers • Land Organic Growth: ~3% • Development Organic Growth: ~8% • M&A: In line with h
Slide 22: Closing Remarks
Closing Remarks Andrew Masterman | President and Chief Executive Officer 3Q FY2022 Earnings Presentation | 22
Slide 23: Looking Ahead
Looking Ahead Industry leader with resilient business & unparalleled customer value proposition Investments in sales force and technology to power organic growth momentum Excellent M&A engine to support further topline acceleration and expand footprint Revenue ~$3B in FY23, expecting Adj. EBITDA gro
Slide 24: Questions & Answers
3Q FY2022 Earnings Call QUESTIONS & ANSWERS 3Q FY2022 Earnings Presentation | 24
Slide 25: Appendix
Inspiring People. Nurturing Landscapes. Appendix
Slide 26: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation Three Months Ended Nine Months Ended June 30, June 30, (in millions)* 2022 2021 2022 2021 Adjusted EBITDA Net income (loss) $ 10.8 $ 25.2 $ (1.3) $ 19.5 Plus: Interest expense, net 14.8 9.4 34.5 32.5 Income tax expense (benefit) 4.5 9.5 (0.3) 8.1 Depreciation expense
Slide 27: Non-GAAP to GAAP Reconciliation (cont.)
Non-GAAP to GAAP Reconciliation (cont.) (a) Business transformation and integration costs consist of (i) severance and related costs; (ii) business integration costs and (iii) information technology infrastructure, transformation costs, and other. Three Months Ended Nine Months Ended June 30, June 3
Slide 28: Non-GAAP to GAAP Reconciliation (cont.)
Non-GAAP to GAAP Reconciliation (cont.) Total Financial Debt and Total Net Financial Debt June 30, March 31, June 30, (in m illions)* 2022 2022 2021 Long-term debt, net $ 1,336.4 $ 1,259.3 $ 1,121.8 Plus: Current portion of long-term debt 12.0 10.4 10.4 Financing costs, net 10.9 9.5 11.9 Present val
Slide 29: Thank You
Thank You Investor Relations Contact: Media Contact: Faten Freiha David Freireich VP of Investor Relations VP of Communications & Public Affairs 484.567.7148 484.567.7244 Faten.Freiha@BrightView.com David.Freireich@BrightView.com investor.brightview.com