Standex International Corporation · NYSE:SXI
Standex International — Q1 2020 Earnings Presentation
16 slides from Standex International's earnings presentation, Nov 6, 2019
Slide 1: First Quarter Fiscal 2020 Conference Call
First Quarter Fiscal 2020 Conference Call November 6, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements contained in this presentation that are not based on historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology s
Slide 3: 1Q20 Highlights
1Q20 Highlights • Engraving: significant sequential margin increase from 4Q19 on a modest sales gain; improved N.A. performance • Electronics: results impacted by lower demand and material inflation, primarily in Asia SEGMENT PERFORMANCE • Engineering Technologies: continued strength in Aviation, Sp
Slide 4: Engraving
Engraving Engraving $ in 000’s 1Q20 1Q19 % 1Q Summary Change • Sales growth driven by GS and Tenibac acquisitions partially offset by lower organic sales and currency Revenue $38,431 $35,979 6.8% headwinds Adj. Operating Income* $6,537 $8,003 -18.3% • Sequentially, ~300 basis point margin improvemen
Slide 5: Electronics
Electronics Electronics $ in 000’s 1Q20 1Q19 % 1Q Summary Change • Sales decline impacted primarily by weaker end markets in Asia Revenue $46,617 $51,450 -9.4% • Operating income declined mostly due to the Operating Income $8,099 $12,787 -36.7% impact of volume deleveraging and material OI Margin 17
Slide 6: Engineering Technologies
Engineering Technologies Engineering Technologies $ in 000s 1Q20 1Q19 % 1Q Summary Change • Volume leverage associated with core markets of Revenue $24,644 $20,784 +18.6% Aviation, Space and Defense • Backlog to be delivered in under one year increased Operating Income $3,359 $1,775 +89.2% 7% YOY OI
Slide 7: Hydraulics
Hydraulics Hydraulics $ in 000s 1Q20 1Q19 % 1Q Summary Change • Strong demand in NA refuse and construction Revenue $13,749 $12,536 +9.7% markets • New applications, such as the new pack eject Operating Income $2,527 $1,583 +59.6% cylinder continued ramp to full volume OI Margin 18.4% 12.6% • YOY ma
Slide 8: Food Service Equipment Group
Food Services Food Service Equipment Group $ in 000s 1Q20 1Q19 % 1Q Summary Change • Scientific double digit growth and strength in Merchandising; Refrigeration results flat YOY Revenue $72,997 $72,331 0.9% • Operating income increase reflected higher Operating Income $8.372 $6,668 25.6% product vol
Slide 9: 1Q20 Financial Summary
1Q20 Financial Summary ($ in M's) 1Q20 1Q19 YOY Comments Revenue $196.4 $193.1 1.7% Components of revenue increase: Organic -1.7% Acquisitions +4.4% F/X impact of -1.0% Gross Margin 34.8% 35.9% -110 bps Adj. Gross Margin 34.8% 36.1% -130 bps Volume deleverage / materials inflation at Electronics Asi
Slide 10: 1Q20 Revenue Drivers
1Q20 Revenue Drivers Strength at Engineering, Hydraulics and Scientific Electronics Impacted by Asia Market Slowdown 10
Slide 11: 1Q20 GAAP to Non-GAAP Bridge
1Q20 GAAP to Non-GAAP Bridge Q1 FY20 Q1 FY19 Pre-tax Net Pre-tax Net Income Tax Income EPS Income Tax Income EPS Reported - GAAP ($M) $ 17.2 $ (4.8) $ 12.5 $ 1.00 $ 20.1 $ (5.8) $ 14.4 $ 1.12 Add: Restructuring Charges $ 1.5 $ (0.4) $ 1.1 $ 0.09 $ 0.4 $ (0.1) $ 0.3 $ 0.02 Purchase Accounting $ - $ -
Slide 12: 1Q20 Free Cash Flow
1Q20 Free Cash Flow Q1 Q1 Free operating cash flow (continuing ops) in $M: FY 2020 FY 2019 Net cash provided by operating activities, as reported $ 8.3 $ (2.6) Less: Capital Expenditures (7.0) (7.5) Free operating cash flow $ 1.3 $ (10.0) • Key working capital metrics all showed year-over-year impro
Slide 13: 1Q20 Working Capital Trends
1Q20 Working Capital Trends $200 Q1 FY 20 Q1 FY 19 7.0 $180 Actual Actual $160 5.6 5.5 5.4 6.0 5.1 5.0 A/R ($M) 114.4 123.8 $140 4.5 5.0 DSO 51 55 NWC Turns $120 NWC $’s 4.0 $100 Inventory ($M) 98.4 111.7 $80 3.0 Inventory Turns 5.4 4.4 $60 2.0 $40 A/P ($M) (66.7) (63.2) $20 1.0 DPO 42 40 $- - Q1 FY
Slide 14: 1Q20 Capitalization
1Q20 Capitalization Favorable Liquidity Profile • Net debt to adj. EBITDA of 0.9x 1Q20 4Q19 • Net debt to total capital of 17.3% (in $M) 9/30/2019 6/30/2019 • ~$250M of available liquidity Funded Debt (ex-issuance costs) 188.9 197.6 Cash 90.2 93.1 Capital Spending Net Debt 98.7 104.5 Net Debt to Cap
Slide 15: Key Takeaways
Key Takeaways Expect second quarter results to be similar to first quarter followed 1 by strengthening in the second half. 2 Ongoing focus on productivity improvements and cost reduction efforts 3 Portfolio focused on higher growth and return opportunities 4 Substantial financial flexibility for dis
Slide 16: Q&A
Q&A HT Standex
Standex International — Q1 2020 Earnings Presentation on 6ix