Armstrong World Industries Inc · NYSE:AWI
Armstrong World Industries — Q2 2021 Earnings Presentation
20 slides from Armstrong World Industries's earnings presentation, Jul 27, 2021
Slide 1: Earnings Call Presentation 2nd Quarter 2021
July 27, 2021 Earnings Call Presentation 2nd Quarter 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 Our disclosures in this presentation, including without limitation, those relating to future financial results market conditions and guidance, the impacts of COVID-19 on our business, and in our other public documents and comments contain forward-looking statements within the
Slide 3: Basis of Presentation Explanation
Basis of Presentation Explanation 3 When reporting our financial results within this presentation, we make several adjustments. Management uses these non-GAAP measures in managing the business and believes the adjustments provide meaningful comparisons of operating performance between periods. As re
Slide 4: Second-Quarter 2021 Highlights
Second-Quarter 2021 Highlights 4 Net Sales Strong year-over-year and sequential improvements $280 in sales and earnings +38% $203 +59% +32% Average Unit Value (AUV) up 10% on both price and mix improvements; pricing actions offsetting inflation pressures Q2 20 Q2 21 Mineral Fiber Arch Spec Adjusted
Slide 5: Second Quarter 2021 Consolidated Company Key Metrics
Second Quarter 2021 Consolidated Company Key Metrics 5 Q2 2020 Q2 2021 Variance Net Sales $203 $280 38% Adj. EBITDA* $69 $100 44% % of Sales 34% 36% 160 bps Adj. Earnings Per Share* $0.72 $1.16 61% Adj. Free Cash Flow* $63 $64 1% Cash $117 $119 $2 Liquidity $487 $419 ($68) Net Debt $539 $559 $20 Lev
Slide 6: Mineral Fiber Second Quarter 2021 Results
Mineral Fiber Second Quarter 2021 Results 6 Sales $208 Key Highlights Up 32% • Volumes surged on more normalized demand vs. $158 peak impacts from COVID-19 in prior-year period • Fourth consecutive quarter of sequential improvement in sales per shipping day • AUV up 10% vs. Q2 2020 on positive like-
Slide 7: Architectural Specialties Second Quarter 2021 Results
Architectural Specialties Second Quarter 2021 Results 7 Sales Key Highlights $72 Up 59% • 2020 Acquisitions added $17 million in sales • Organic* sales up 20% or $9 million driven by diminished Covid-19 impacts vs. prior year $45 • Adjusted EBITDA** up 48% vs. prior year • Adjusted EBITDA** margin e
Slide 8: Consolidated Company Key Metrics – 1st Half 2021
Consolidated Company Key Metrics – 1st Half 2021 8 YTD 2020 YTD 2021 Variance Adj. Net Sales* $452 $533 18% Adj. EBITDA* $166 $185 12% % of Adj. Net Sales 36.6% 34.7% (200) bps Adj. Earnings Per Share* $1.86 $2.11 13% Adj. Free Cash Flow* $100 $87 -13% $250 $15 $34 Adj. EBITDA* Bridge VPY $200 ($3)
Slide 9: Adjusted Free Cash Flow Bridge – Q2 YTD 2021 vs. PY
Adjusted Free Cash Flow* Bridge – Q2 YTD 2021 vs. PY 9 $120 $100 $1 $100 $4 $2 $87 ($12) ($7) $80 $60 $40 $20 $0 Q2 2020 YTD Operating Capex Interest WAVE Other Q2 2021 YTD Cash Flow (1) Paid Dividends Cash earnings decline driven by higher, planned CapEx vs. 2020 *Non-GAAP measure. See appendix for
Slide 10: 2021 Guidance – July Update
2021 Guidance – July Update ⁽¹⁾ 10 Updated from prior guide 2020 Actual Prior Guidance Current Guidance MF AUV 6%-9%, positive like-for-like pricing & mix $1,030 – $1,060 $1,085 – $1,105 Growth Initiatives, primarily kanopi & Healthy Revenue $937 10% – 13% YoY 16% – 18% YoY Spaces, drive MF volu
Slide 11: Clear Strategy Driving Value Creation
Clear Strategy Driving Value Creation 11 Strategic Overview Mineral Fiber Architectural Digital Disciplined Capital Revitalization Specialties Growth Transformation Allocation Healthy Spaces to drive Continued integration of 10-3-1 path from Consistent capex renovation “renaissance” acquisit
Slide 12: Appendix
Appendix =m 2 ANA @mstrong WORLD INDUSTRIES
Slide 13: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation 13 For the Three Months Ended For the Six Months Ended June 30, June 30, 2021 2020 V 2021 2020 V Earnings (Loss) from continuing operations, $55 $50 $6 $93 ($173) $266 Reported Add: Income tax expense (benefit), as reported 19 11 8 31 (66) 98 Earnings (Loss) before tax
Slide 14: Adjusted Diluted Earnings Per Share Reconciliation
Adjusted Diluted Earnings Per Share Reconciliation 14 CONSOLIDATED For the Three Months Ended June 30, For the Six Months Ended June 30, Per Per Per Per 2021 Diluted 2020 Diluted V 2021 Diluted 2020 Diluted V Share (3) Share (3) Share (3) Share (3) Earnings from continuing operations before income t
Slide 15: Adjusted Free Cash Flow Reconciliation
Adjusted Free Cash(1) Flow Reconciliation 15 CONSOLIDATED For the Three Months Ended For the Six Months Ended June 30, June 30, 2021 2020 V 2021 2020 V As Reported net cash provided by operating activities $63 $53 $10 $82 $79 $4 Net cash provided by (used for) investing activities 2 0 1 (7) 10 (17)
Slide 16: Segment Reported Operating Income (Loss) to Adjusted EBITDA
Segment Reported Operating Income (Loss) to Adjusted EBITDA 16 ARCHITECTURAL MINERAL FIBER UNALLOCATED CORPORATE SPECIALTIES For the Three Months Ended June 30, 2021 2020 V 2021 2020 V 2021 2020 V Operating Income (Loss) – As Reported $72 $46 $27 $7 $4 $3 ($1) $13 ($14) Add: RIP expense (1) - - - -
Slide 17: Adjusted Net Sales Reconciliation
Adjusted Net Sales Reconciliation 17 CONSOLIDATED For the Three Months Ended For the Six Months Ended June 30, June 30, 2021 2020 V 2021 2020 V Reported Net Sales $280 $203 $77 $532 $452 $80 Deferred revenue adjustment (1) - - - 1 - 1 Adjusted Net Sales $280 $203 $77 $533 $452 $81 (1) Represents the
Slide 18: 2021 Adjusted EBITDA Guidance Reconciliation
2021 Adjusted EBITDA Guidance Reconciliation 18 Adjusted EBITDA CONSOLIDATED For the Year Ending December 31, 2021 Low to High Net Income $190 to $198 Add: Interest expense 25 25 (Less): RIP credit (1) (8) (8) Add: Income tax expense 61 63 Operating Income $267 to $277 Add: RIP expense (2) 5 5 Add:
Slide 19: 2021 Adjusted EPS Guidance Reconciliation
2021 Adjusted EPS Guidance Reconciliation 19 Adjusted Diluted Earnings Per Share CONSOLIDATED For the Year Ending December 31, 2021 Per Per Low Diluted to High Diluted Share (1) Share (1) Net income $190 $3.96 to $198 $4.12 Add: Interest expense 25 25 (Less): RIP credit (2) (8) (8) Add: Income tax e
Slide 20: 2021 Adjusted Free Cash Flow Guidance Reconciliation
2021 Adjusted Free Cash Flow Guidance Reconciliation 20 Adjusted Free Cash Flow
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