Ecolab Inc. · NYSE:ECL
Ecolab — Q3 2023 Earnings Presentation
21 slides from Ecolab's earnings presentation, Oct 31, 2023
Slide 1: Ecolab Third Quarter 2023 Supplemental
1 ECOLAB Third Quarter 2023 Supplemental
Slide 2: Cautionary statement
Cautionary statement Forward-Looking Information This communication contains forward looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements regarding macroeconomic conditions, de
Slide 3: Strong 3Q performance and outlook
Strong 3Q performance and outlook Continued strong sales growth ▪ Reported sales +8%, organic sales +7% ▪ Volume trends accelerated sequentially as good new business gains offset easing macro end-market demand Strong double-digit OI growth with expanding OI margin ▪ Reported OI +17%, organic OI +20%
Slide 4: 3Q overview
3Q overview ▪ Strong growth with reported sales +8% and organic sales +7% o Pricing +7%, reflected further value-based pricing on top of last year’s strong pricing o Volumes accelerated from -1% in 2Q to stable in 3Q; +1% excluding Europe ▪ Strong organic growth led by the Institutional & Specialty
Slide 5: 4Q and 2024 outlook
4Q and 2024 outlook ▪ Ecolab expects fourth quarter 2023 adjusted diluted EPS in the $1.48 to $1.58 range, rising 17% to 24% compared with adjusted diluted earnings per share of $1.27 a year ago. ▪ Within this forecast, the company expects to deliver continued pricing, volume growth, year-over- year
Slide 6: 3Q 2023 sales growth detail
3Q 2023 sales growth detail Amounts in the tables above may reflect rounding. Organic excludes sales to ChampionX post-separation. 6
Slide 7: Global Industrial Segment - Water
Global Industrial Segment Sales +5% Water ▪ Good sales growth driven by robust pricing and new business wins, which overcame comparisons to last year’s very strong growth. o Light Water: good sales growth led by continued strong performance across data centers and microelectronics. o Heavy Water: so
Slide 8: Global Industrial Segment - Paper
Global Industrial Segment Sales -7% Paper ▪ As expected, lower sales reflected good pricing and new business wins that were more than offset by easing customer production rates and comparisons to last year’s very strong growth. ▪ Sales declined across all segments as end-market demand continued to e
Slide 9: Global Institutional and Specialty Segment
Global Institutional and Specialty Segment Sales +10% Institutional ▪ Strong sales growth driven by robust pricing and new business gains, which together continue to benefit from our innovative products and services that help customers reduce costs and optimize their labor. o North America: double-d
Slide 10: Global Healthcare & Life Sciences Segment
Global Healthcare & Life Sciences Segment Sales +15% Healthcare ▪ Underlying sales growth improved, driven by robust pricing and good new business gains across both North America and Europe. Sales benefited from larger than normal surgical sales, which had a one-time favorable impact of 6 percentage
Slide 11: Other Segments
Other Segments Sales +10% Pest Elimination ▪ Strong sales growth led by double-digit gains in restaurants, food & beverage, food retail, and healthcare. o Growth benefited from strong pricing and continued robust new business wins, driven by our high service levels, innovation, and circle the custom
Slide 12: Segment operating income performance
Segment operating income performance ($ millions – fixed currency, unaudited) ▪ Organic operating income increased 8% as continued pricing overcame ▪ Organic operating income increased 28% as strong pricing overcame investments in the business including incentive compensation and investments in the
Slide 13: Consolidated margin performance
Consolidated margin performance Gross Margin ▪ Gross margin expanded significantly, reflecting strong pricing and slightly lower delivered product costs. SG&A ▪ Sales leverage and cost savings were offset by investments in the business including incentive compensation. As expected, SG&A expense was
Slide 14: 3Q 2023 balance sheet / cash flow
3Q 2023 balance sheet / cash flow * EBITDA and Adjusted EBITDA are non-GAAP measures. EBITDA is defined as the sum of earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as the sum of EBITDA and special (gains) and charges impacting EBITDA. The inputs to EBITDA
Slide 15: Non-GAAP financial measures
Non-GAAP financial measures 15
Slide 16: Non-GAAP financial measures
Non-GAAP financial measures 16
Slide 17: Non-GAAP financial measures
Non-GAAP financial measures 17
Slide 18: Non-GAAP financial measures
Non-GAAP financial measures 18
Slide 19: Non-GAAP financial measures
Non-GAAP financial measures 19
Slide 20: Non-GAAP financial information
Non-GAAP financial information Non-GAAP Financial Information: This communication and certain of the accompanying tables include financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (“GAAP”). These non-GAAP financial measures includ
Slide 21: Non-GAAP financial information (cont.)
Non-GAAP financial information (cont.) Non-GAAP Financial Information (Continued): Our non-GAAP financial measures for adjusted cost of sales, adjusted gross margin, adjusted gross profit and adjusted operating income exclude the impact of special (gains) and charges and our non- GAAP financial meas