H. B. Fuller Company · NYSE:FUL
H. B. Fuller — Q2 2019 Earnings Presentation
22 slides from H. B. Fuller's earnings presentation, Jun 27, 2019
Slide 1: Second Quarter 2019 Conference Call
Second Quarter 2019 Conference Call Investor Presentation St. Paul, MN June 27, 2019
Slide 2: Safe Harbor & Regulation G
2 Safe Harbor & Regulation G Safe Harbor Statement Certain matters discussed today may include 'forward looking statements' as that term is defined under the Private Securities Litigation Reform Act of 1995. Since such statements reflect our current expectations, actual results may differ as they ar
Slide 3: Q2'19 Business Summary
3 Q2’19 Business Summary Q2’19 Highlights 2019 Imperatives • Q2’19 earnings in-line with guidance • Increase EBITDA by effectively managing product lines, pricing and • Organic sales growth up +1% YoY operations – Positive pricing contribution Delivering strong operational improvement – Double-dig
Slide 4: Q2 2019 Segment Summary
4 Q2Better 2019 Segment Summary accountability Stronger teamwork Global vision Americas Adhesives • 1% organic sales growth - strong pricing contribution • Hygiene & Packaging growth offsets construction-related weakness • Continued adjusted EBITDA margin improvement EIMEA Asia Pacific • Slower grow
Slide 5: Q2 2019 Key Financial Results Summary
5 Q2 2019 Key Financial Results Summary • Net Revenue down 3.8% year-over-year due to unfavorable FX impact; 1% organic growth • Adjusted gross margin of 28.9% increased 90 bps YOY • Adjusted SG&A declined by 1.5% YoY • Adjusted EPS of $0.88 vs. $0.89 in Q2’18 • Adjusted EBITDA of $121M vs. $123M in
Slide 6: FY 2019 Guidance Update
6 FY 2019 Guidance Update Revised Prior Reported Revenue Approx. -3% YoY Flat to FY’18 Organic Growth 1% to 2% Low end of 3% to 5% FX impact -3% to -4% -2% to -3% Divestiture -0.5% N/A Adjusted EPS $3.10 to $3.30 $3.15 to $3.45 Adjusted EBITDA $455M to $465M $465M to $485M Debt paydown $250M $200M A
Slide 7: Wrap-Up
6 Wrap-Up • Strong Q2 operating performance leveraged improved business mix, integration synergies, pricing and raw materials management • Strong margin and cash flow resilience to dynamic external conditions • Winning new customer business in highly engineered applications • Continued focus on orga
Slide 8: H.B. Fuller
a =H.B. Fuller
Slide 9: Appendix
APPENDIX Q2 2019 Investor Presentation
Slide 10: Regulation G – EPS & EBITDA Reconciliation
9 Regulation G – EPS & EBITDA Reconciliation Three Months Ended Six Months Ended June 1, 2019 June 2, 2018 June 1, 2019 June 2, 2018 Net income attributable to H.B. Fuller $ 36,641 $ 44,451 $ 48,885 $ 92,133 Adjustments: Acquisition project costs 539 297 623 672 Tonsan call option agreement - (2,294
Slide 11: Regulation G – Q2 2019 Segment Information
11 Regulation G – Q2 2019 Segment Information Three Months Ended Three Months Ended June 1, 2019 June 2, 2018 Net Revenue: Americas Adhesives $ 259,782 $ 266,232 EIMEA 165,453 182,175 Asia Pacific 71,199 74,421 Construction Adhesives 111,244 122,891 Engineering Adhesives 151,905 143,668 Total H.B. F
Slide 12: Regulation G – FY 2019 Segment Information
12 Regulation G – FY 2019 Segment Information Six Months Ended Six Months Ended June 1, 2019 June 2, 2018 Net Revenue: Americas Adhesives $ 501,732 $ 517,195 EIMEA 321,966 351,154 Asia Pacific 134,587 141,029 Construction Adhesives 193,700 221,148 Engineering Adhesives 280,533 271,940 Total H.B. Ful
Slide 13: Regulation G – Adjusted Income Reconciliation
11 Regulation G – Adjusted Income Reconciliation Three Months Ended Six Months Ended June 1, 2019 June 2, 2018 June 1, 2019 June 2, 2018 Income before income taxes and income from equity method investments $ 51,449 $ 55,813 $ 65,272 $ 69,027 Adjustments: Acquisition project costs 655 449 769 1,007 T
Slide 14: Regulation G – Adjusted Income Tax Reconciliation
12 Regulation G – Adjusted Income Tax Reconciliation Three Months Ended Six Months Ended June 1, 2019 June 2, 2018 June 1, 2019 June 2, 2018 Income Taxes $ (16,441) $ (13,488) $ (19,581) $ 19,144 Adjustments: Acquisition project costs (116) (152) (146) (336) Tonsan call option agreement - - - - Orga
Slide 15: Regulation G – Adjusted Gross Margin Reconciliation
13 Regulation G – Adjusted Gross Margin Reconciliation Three Months Ended Six Months Ended June 1, 2019 June 2, 2018 June 1, 2019 June 2, 2018 Net revenue 759,583 789,387 1,432,518 1,502,466 Gross profit $ 218,459 $ 220,186 $ 398,384 $ 405,699 Gross profit margin 28.8% 27.9% 27.8% 27.0% Adjustments:
Slide 16: Regulation G – Adjusted SG&A Reconciliation
14 Regulation G – Adjusted SG&A Reconciliation Three Months Ended Six Months Ended June 1, 2019 June 2, 2018 June 1, 2019 June 2, 2018 Selling, general and administrative expenses $ (146,079) $ (146,889) $ (291,792) $ (299,596) Adjustments: Acquisition project costs 655 379 769 834 Tonsan call optio
Slide 17: Regulation G – Q2'19 Segment EBITDA Recon.
17 Regulation G – Q2’19 Segment EBITDA Recon. Americas Asia Construction Engineering Corporate H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated Three Months Ended June 1, 2019 Net income attributable to H.B. Fuller $ 28,489 $ 9,232 $ 5,798 $ 7,794 $ 24,515 $ 75,
Slide 18: Regulation G – FY 2019 Segment EBITDA Recon.
18 Regulation G – FY 2019 Segment EBITDA Recon. Americas Asia Construction Engineering Corporate H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated Six Months Ended June 1, 2019 Net income attributable to H.B. Fuller $ 46,160 $ 13,314 $ 9,618 $ 5,139 $ 39,252 $ 11
Slide 19: Regulation G – Q2'18 Segment EBITDA Recon.
19 Regulation G – Q2’18 Segment EBITDA Recon. Americas Asia Construction Engineering Corporate H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocate Consolidated Three Months Ended June 2, 2018 Net income attributable to H.B. Fuller $ 28,645 $ 11,599 $ 5,061 $ 12,869 $ 19,012 $ 77
Slide 20: Regulation G – FY 2018 Segment EBITDA Recon.
20 Regulation G – FY 2018 Segment EBITDA Recon. Americas Asia Construction Engineering H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocate Consolidated Six Months Ended June 2, 2018 Net income attributable to H.B. Fuller $ 45,043 $ 18,457 $ 7,403 $ 14,158 $ 28,810 $ 113,871 $ (2
Slide 21: Revenue Growth Components
21 Revenue Growth Components Three Months Ended Six Months Ended June 1, 2019 June 1, 2019 Total Total Price 2.3% 2.6% Volume (1.4%) (2.6%) Organic Growth (Decline) 0.9% 0.0% F/X (4.7%) (4.7%) Total (3.8%) (4.7%) Three Months Ended Six Months Ended June 1, 2019 June 1, 2019 Organic Organic Growth Gr
Slide 22: Investor contact
22 Investor contact: Vice President, Investor Relations H.B. Fuller Barbara Doyle (651) 236-5023 Q2 2019 Investor Presentation