Rpm International Inc. · NYSE:RPM
Rpm International — Q3 FY2022 Earnings Presentation
29 slides from Rpm International's earnings presentation, Apr 6, 2022
Slide 1: Fiscal 2022 Third-Quarter Results
Fiscal 2022 Third-Quarter Results Frank C. Sullivan Chairman and CEO April 6, 2022
Slide 2: Forward-Looking Statements & Regulation G
Forward-Looking Statements & Regulation G This presentation contains “forward-looking statements” relating to our business. These forward-looking statements, or other statements made by us, are made based on our expectations and beliefs concerning future events impacting us and are subject to uncert
Slide 3: Q3 2022 Performance
Q3 2022 Performance FINANCIAL HIGHLIGHTS $1.43B Manufacturing Center of Excellence High-performance building solutions RECORD SALES +13% Making Significant $180.1M Investments in RETURNED TO SHAREHOLDERS $67M High-Growth RECORD EBIT through Dividends and Share Repurchases in +2.3% Initiatives fiscal
Slide 4: Fiscal 2022 Third-Quarter Financial Results | Consolidated
Fiscal 2022 Third-Quarter Financial Results | Consolidated Record sales and adjusted EBIT achieved despite supply disruption and inflation ($ in millions, except 3Q 3Q 3Q % Change per share amounts) 2022 2021 2020 HIGHLIGHTS F22 vs F21 F22 vs F20 • Sales increased 13.0% to a Q3 record of Sales $1,43
Slide 5: 3 of 4 Segments Achieved Record Third-Quarter Sales and Adjusted EBIT
3 of 4 Segments Achieved Record Third-Quarter Sales and Adjusted EBIT Third-Quarter Ended February 28, 2022 HIGHLIGHTS 110% 97.0% 89.7% 89.9% • Q3 performance reflects the 90% benefits of RPM’s balanced 70% business portfolio, where softness in one segment is generally offset 50% by strength in the
Slide 6: Construction Products Group
Fiscal 2022 Third-Quarter Financial Results CPG generated record third-quarter top- and bottom-line results 3Q 3Q 3Q % Change CONSTRUCTION ($ in millions, except per share amounts) 2022 2021 2020 F22 vs F21 F22 vs F20 PRODUCTS GROUP Sales $482 $396 $372 +21.7% +29.5% EBIT1 $33 $17 $2 +101.4% +1,911.
Slide 7: Performance Coatings Group
Fiscal 2022 Third-Quarter Financial Results PCG revenue and adjusted EBIT increased to third-quarter record levels PERFORMANCE ($ in millions, except per share amounts) 3Q 2022 3Q 2021 3Q 2020 % Change F22 vs F21 F22 vs F20 COATINGS GROUP Sales $271 $227 $256 +19.6% +5.9% EBIT1 $25 $12 $22 +105.6% +
Slide 8: Specialty Products Group
Fiscal 2022 Third-Quarter Financial Results SPG generated record third-quarter sales and adjusted EBIT SPECIALTY ($ in millions, except per share amounts) 3Q 2022 3Q 2021 3Q 2020 % Change F22 vs F21 F22 vs F20 PRODUCTS GROUP Sales $189 $169 $147 +11.9% +28.4% EBIT1 $26 $25 $13 +5.2% +99.7% Adjusted
Slide 9: Consumer Group
Fiscal 2022 Third-Quarter Financial Results Demand remained strong, while raw material shortages and inflation impacted performance CONSUMER ($ in millions, except per share amounts) 3Q 2022 3Q 2021 3Q 2020 % Change F22 vs F21 F22 vs F20 GROUP Sales $492 $478 $399 +2.9% +23.3% EBIT1 $17 $43 $30 -60.
Slide 10: Strategic Capital Allocation to Drive Growth and Reward Stockholders
Strategic Capital Allocation to Drive Growth and Reward Stockholders Fund Internal Make Strategic Growth Initiatives Acquisitions Capital Allocation Reward Investors Repurchase Stock with Cash Dividends ($15 million in 3Q-22) Fiscal 2022 Third-Quarter Results | April 6, 2022 10
Slide 11: Fiscal 2022 Fourth-Quarter Guidance
Fiscal 2022 Fourth-Quarter Guidance CATEGORY OUTLOOK (YOY) SALES | Consolidated Increase low teens Construction Products Group Increase low teens Performance Coatings Group Increase low teens Specialty Products Group Increase low teens Consumer Group Increase low teens ADJUSTED EBIT | Consolidated I
Slide 12: Russia/Ukraine Conflict has Minimal Direct Impact on RPM
Russia/Ukraine Conflict has Minimal Direct Impact on RPM • RPM has stopped conducting business with Russia • Sales to Ukraine and Russia are immaterial • Russian sanctions are exacerbating energy and transportation cost inflation and creating supply challenges for plant-based raw materials and those
Slide 13: Appendix: Reconciliations of Non-GAAP to GAAP Measures
APPENDIX Reconciliations of Non-GAAP to GAAP Measures April 6, 2022
Slide 14: Consolidated Statements of Income: Three Months
Consolidated Statements of Income: Three Months ($ in thousands, except per share and percent data) Three Months Ended (Unaudited) February 28, 2022 % February 28, 2021 % % Change Net Sales $ 1,433,879 $ 1,269,395 13.0 Cost of Sales 935,293 65.2 797,454 62.8 Gross Profit 498,586 34.8 471,941 37.2 SG
Slide 15: Consolidated Statements of Income: Nine Months
Consolidated Statements of Income: Nine Months ($ in thousands, except per share and percent data) Nine Months Ended (Unaudited) February 28, 2022 % February 28, 2021 % % Change Net Sales $ 4,723,838 $ 4,361,981 8.3 Cost of Sales 3,029,287 64.1 2,650,213 60.8 Gross Profit 1,694,551 35.9 1,711,768 39
Slide 16: Non-GAAP Financial Measures
Non-GAAP Financial Measures The following are the non-GAAP financial measures used in this presentation: *Interest (Income) Expense, Net includes the combination of interest (income) expense and investment (income) expense, net. **EBIT is defined as earnings (loss) before interest and taxes. Managem
Slide 17: Adjustments Detail
Adjustments Detail a) Charges recorded in Cost of Goods Sold related to inventory write-offs in connection with restructuring activities, partially offset by subsequent recoveries and revisions of accrual estimates. b) Reflects restructuring charges, including headcount reductions, closures of facil
Slide 18: Reconciliation of Reported to Adjusted EPS: Three Months
Reconciliation of "Reported" to "Adjusted" EPS: Three Months (Unaudited) Reconciliation of Reported Earnings per Diluted Share to Adjusted Three Months Ended Earnings per Diluted Share (All amounts presented after-tax): February 28, 2022 February 28, 2021 Reported Earnings per Diluted Share $ 0.25 $
Slide 19: Reconciliation of Reported to Adjusted EPS: Nine Months
Reconciliation of "Reported" to "Adjusted" EPS: Nine Months (Unaudited) Reconciliation of Reported Earnings per Diluted Share to Adjusted Nine Months Ended Earnings per Diluted Share (All amounts presented after-tax): February 28, 2022 February 28, 2021 Reported Earnings per Diluted Share $ 2.26 $ 2
Slide 20: EBIT (Non-GAAP Measure): RPM Consolidated: Three Months
EBIT** (Non-GAAP Measure): RPM Consolidated: Three Months ($ in thousands, except per share and percent data) Three Months Ended (Unaudited) February 28, 2022 February 28, 2021 Net Income $ 33,249 $ 38,466 Provision for Income Taxes 7,248 17,394 Income Before Income Taxes 40,497 55,860 Interest Expe
Slide 21: EBIT (Non-GAAP Measure): RPM Consolidated: Nine Months
EBIT** (Non-GAAP Measure): RPM Consolidated: Nine Months ($ in thousands, except per share and percent data) Nine Months Ended (Unaudited) February 28, 2022 February 28, 2021 Net Income $ 293,160 $ 347,136 Provision for Income Taxes 91,962 117,049 Income Before Income Taxes 385,122 464,185 Interest
Slide 22: EBIT: Construction Products Segment: Three Months
EBIT** (Non-GAAP Measure): Construction Products Segment: Three Months ($ in thousands, except per share and percent data) Three Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 31,498 $ 14,431 Add: Interest Expense, Net* 1,735 2,074 EBIT** (non-GAAP measure)
Slide 23: EBIT: Construction Products Segment: Nine Months
EBIT** (Non-GAAP Measure): Construction Products Segment: Nine Months ($ in thousands, except per share and percent data) Nine Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 276,223 $ 184,613 Add: Interest Expense, Net* 5,254 6,325 EBIT** (non-GAAP measure)
Slide 24: EBIT: Performance Coatings Segment: Three Months
EBIT** (Non-GAAP Measure): Performance Coatings Segment: Three Months ($ in thousands, except per share and percent data) (Unaudited) Three Months Ended February 28, 2022 February 28, 2021 Income Before Income Taxes $ 24,917 $ 12,158 Add: Interest (Income), Net* (76) (75) EBIT** (non-GAAP measure) 2
Slide 25: EBIT: Performance Coatings Segment: Nine Months
EBIT** (Non-GAAP Measure): Performance Coatings Segment: Nine Months ($ in thousands, except per share and percent data) Nine Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 97,849 $ 64,719 Add: Interest (Income), Net* (407) (53) EBIT** (non-GAAP measure) 97
Slide 26: EBIT: Specialty Products Segment: Three Months
EBIT** (Non-GAAP Measure): Specialty Products Segment: Three Months ($ in thousands, except per share and percent data) Three Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 25,881 $ 24,560 Add: Interest Expense, Net* 18 64 EBIT** (non-GAAP measure) 25,899 2
Slide 27: EBIT: Specialty Products Segment: Nine Months
EBIT** (Non-GAAP Measure): Specialty Products Segment: Nine Months ($ in thousands, except per share and percent data) Nine Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 71,028 $ 73,415 Add: Interest Expense, Net* 82 219 EBIT** (non-GAAP measure) 71,110 73
Slide 28: EBIT: Consumer Segment: Three Months
EBIT** (Non-GAAP Measure): Consumer Segment: Three Months ($ in thousands, except per share and percent data) Three Months Ended (Unaudited) February 28, 2022 February 28, 2021 Income Before Income Taxes $ 16,893 $ 42,724 Add: Interest (Income) Expense, Net* (62) 60 EBIT** (non-GAAP measure) 16,831
Slide 29: EBIT: Consumer Segment: Nine Months
EBIT** (Non-GAAP Measure): Consumer Segment: Nine Months ($ in thousands, except per share and percent data) (Unaudited) Nine Months Ended February 28, 2022 February 28, 2021 Income Before Income Taxes $ 95,912 $ 263,813 Add: Interest (Income) Expense, Net* (211) 187 EBIT** (non-GAAP measure) 95,701