Valmont Industries, Inc. · NYSE:VMI
Valmont Industries — Q1 2019 Earnings Presentation
22 slides from Valmont Industries's earnings presentation, Apr 24, 2019
Slide 1: Valmont Industries, Inc. First Quarter 2019 Earnings Presentation
Valmont Industries, Inc. First Quarter 2019 Earnings Presentation April 24, 2019
Slide 2: Forward-looking Statement Disclosure
Forward-looking Statement Disclosure These slides contain (and the accompanying oral discussion will contain) “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that
Slide 3: 1Q 2019 Segment Revenue and Market Drivers
1Q 2019 Segment Revenue and Market Drivers TOTAL 1Q 2019 REVENUE: $692.1M $230.3M $243.9M $86.8M $152.8M Engineered Support Utility Support Coatings Irrigation Structures Structures N.A.: $108.5M | International: $44.3M 33% of Sales 35% of Sales 13% of Sales 22% of Sales MARKET DRIVERS • Increasing
Slide 4: 1Q 2019 Summary
1Q 2019 Summary $M, except for per share amounts Revenue Operating Income Diluted EPS (0.9%) (13.8%) (19.4%) (3.5%) (11.2%) $68.4 $64.0 $692.1 $698.7 $55.1 $55.1 $1.87 $1.66 $1.72 $1.66 2019 2018 GAAP Adjusted 1 GAAP Adjusted 1 2019 2018 2019 2018 • Flood event shifted $10M of sales to 2Q • Lower Ir
Slide 5: 1Q Results | Engineered Support Structures
1Q Results | Engineered Support Structures ($M) Key Statistics Revenue Operating Income 2018 Revenue1 $215.9 Volume 7.5 $228.0 $215.9 Pricing/Mix 9.5 $12.4 $10.6 Acquisitions 5.4 $6.9 Currency Translation (10.3) 2019 Revenue1 $ 228.0 2019 2018 2019 2018 2018 Adj COMMENTARY • Strong order flow, parti
Slide 6: 1Q Results | Utility Support Structures
1Q Results | Utility Support Structures ($M) Key Statistics Revenue Operating Income 2018 Revenue1 $209.9 Volume (14.1) $243.2 $25.0 $24.1 $209.9 $23.4 Pricing/Mix 18.1 Acquisitions 31.0 Currency Translation (1.7) 2019 Revenue1 $ 243.2 2019 2018 2019 2018 2018 Adj COMMENTARY • Sales increased more t
Slide 7: 1Q Results | Coatings
1Q Results | Coatings ($M) Key Statistics Revenue Operating Income 2018 Revenue1 68.5 Volume (6.7) $70.2 $68.5 $11.9 Pricing/Mix 2.9 $10.1 Acquisitions 7.5 Currency Translation (2.0) 2019 Revenue1 $ 70.2 2019 2018 2019 2018 COMMENTARY • Sales growth led by revenues from recent acquisitions and prici
Slide 8: 1Q Results | Irrigation
1Q Results | Irrigation ($M) Key Statistics Revenue Total Operating Income 2018 Revenue1 $186.0 $106.4 $107.9 $33.9 Volume (41.6) $78.1 Pricing/Mix 5.8 $20.1 $44.3 Acquisitions 3.7 Currency Translation (3.2) North America International 2019 2018 2019 Revenue1 $ 150.7 2019 2018 COMMENTARY • As expect
Slide 9: 2019 YTD Cash Flow Statement
2019 YTD Cash Flow Statement Thirteen Weeks Ended Thirteen Weeks Ended 30-Mar-19 31-Mar-18 30-Mar-19 31-Mar-18 Cash flows from operating activities: Cash flows from investing activities: Net earnings $37,455 $40,480 Purchase of property, plant and equipment (21,109) (16,248) Depreciation and amortiz
Slide 10: Capital Allocation | A Balanced Approach
Capital Allocation | A Balanced Approach ($M) Q1 Capital Deployment • Working capital investment to support investments in people, technology and systems Capital • 1Q spending driven by 4 factory expansions to support Growing Our $57 Expenditures strong global market demand Business • Total CapEx of
Slide 11: 2019 Financial Guidance and Key Assumptions
2019 Financial Guidance and Key Assumptions 2019 Full Year Financial Outlook and Key Metrics KEY ASSUMPTIONS PRIOR CURRENT • Revenue growth: evenly divided between organic Diluted and completed EPS $8.10 - $8.90 $8.30 – $8.90 acquisitions Revenue • Raw material inflation Growth1 7% – 8% No Change ex
Slide 12: Highlights from Recent Innovation Summits
Highlights from Recent Innovation Summits INNOVATION SUMMIT Santa Clara, March 27, 2019 Daniel Koppel Steve Kaniewski CEO of Prospera Technologies President & CEO of Valmont Industries, Inc. Deploying our technology in a bigger market can transform the Ag uses two thirds of the available freshwater.
Slide 13: Summary of 2019 Outlook
Summary of 2019 Outlook 01 02 03 04 05 Strength of ESS New product Operational We remain Continuing a and Utility sales across all excellence focus committed to balanced capital businesses is segments is a key will enhance our price discipline allocation strategy driving our factor of our flexible,
Slide 14: Appendix
APPENDIX 14 | April 24, 2019 | Valmont Industries, Inc. | Q1 2019 Earnings Presentation
Slide 15: First Quarter Estimated Financial Impact of Midwest Flooding Event
First Quarter Estimated Financial Impact of Midwest Flooding Event Approximate 1Q Revenue Deferred to 2Q and 3Q $ 10.0M Associated 1Q Earnings per Share Impact $ 0.11 Approximate Other Direct Costs $ 2.3M Associated 1Q Earnings per Share Impact $ 0.07 • Primarily impacted Engineered Support Structur
Slide 16: 1Q 2019 Financial Summary
1Q 2019 Financial Summary $M, except for per share amounts Net Sales 2019 2018 Change Engineered Support Structures $ 230.3 $ 225.0 2.4% Utility Support Structures 243.9 209.9 16.2% Coatings 86.8 84.9 2.2% Irrigation 152.8 187.9 (18.7%) Other - 18.4 (100.0%) Intersegment Sales (21.7) (27.4) NM Net S
Slide 17: Industry Growth Projections for Solar Trackers
Industry Growth Projections for Solar Trackers Data Source: GTM 17 | April 24, 2019 | Valmont Industries, Inc. | Q1 2019 Earnings Presentation
Slide 18: Industry Growth Projections for Small Cell Structures
Industry Growth Projections for Small Cell Structures Source: ”Small cells market status report December 2018”, Small Cell Forum, published December 3 rd, 2018 18 | April 24, 2019 | Valmont Industries, Inc. | Q1 2019 Earnings Presentation
Slide 19: Calculation of Adjusted EBITDA & Leverage Ratio
Calculation of Adjusted EBITDA & Leverage Ratio Certain of our debt agreements contain covenants that require us to maintain certain coverage ratios. Our Debt/Adjusted EBITDA may not exceed 3.5X Adjusted EBITDA (or 3.75X Adjusted EBITDA after certain material acquisitions) of the prior four quarters
Slide 20: Summary of Effect of Significant Non-recurring Items on Reported Results
Summary of Effect of Significant Non-recurring Items on Reported Results VALMONT INDUSTRIES, INC. AND SUBSIDIARIES SUMMARY OF EFFECT OF SIGNIFICANT NON-RECURRING ITEMS ON REPORTED RESULTS REGULATION G RECONCILIATION (Dollars in thousands, except per share amounts) (unaudited) The non-GAAP tables bel
Slide 21: Summary of Effect of Significant Non-recurring Items on Reported Results
Summary of Effect of Significant Non-recurring Items on Reported Results First Quarter Ended March Operating Income Reconciliation 31, 2018 Operating income - as reported $ 63,960 Restructuring expenses 4,400 Adjusted Operating Income $ 68,360 Net Sales 698,684 Operating Income as a % of Sales 9.2%
Slide 22: Summary of Effect of Significant Non-recurring Items on Reported Results
Summary of Effect of Significant Non-recurring Items on Reported Results For the First Quarter Ended March 31, 2018 Engineered Infrastructure Utility Support Other/ Segment Operating Income Reconciliation Products Structures Coatings Irrigation Corporate Operating income - as reported $ 6,947 $ 23,3