Wd-40 Company · NASDAQ:WDFC
Wd-40 — Q1 2024 Earnings Presentation
26 slides from Wd-40's earnings presentation, Jan 9, 2024
Slide 1: Q1 FY24 Earnings Results
Q1 FY24 Earnings Results JANUARY 9, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements Historical financial and operating data in this presentation reflect the consolidated results of WD-40 Company and its subsidiaries (collectively, the “Company”). The Company markets maintenance products (“MP”) under the WD-40®, 3-IN-ONE® and GT85® brand names. The WD-40 b
Slide 3: Q1 FY24 Results
Q1 FY24 Results 3
Slide 4: Q1 FY24 Results
Q1 FY24 Results ($M except EPS, gross margin and % change) Financial Results Q1 FY24 Q1 FY23 % Change As reported Net Sales $140.4 $124.9 12% Gross Margin 53.8% 51.4% +240 bps Operating Income $24.2 $18.7 29% Net Income $17.5 $14.0 25% EPS (Diluted) $1.28 $1.02 25% • Non-GAAP constant currency net s
Slide 5: Americas Segment
Americas Segment Americas – Q1 FY23 vs. Q1 FY24 $64.1 $58.0 • Total reported segment sales ▲ 10% • Segment = 45% of global net sales • WD-40® Multi-Use Product sales ▲ 12% • WD-40 Specialist ® sales ▲ 4% • In constant currency sales ▲ 9% • Maintenance product (MP) sales: • U.S. MP sales ▲ 6% • Latin
Slide 6: EIMEA Segment
EIMEA Segment EIMEA – Q1 FY23 vs. Q1 FY24 $48.8 $40.8 • Total reported segment sales ▲ 20% • Segment = 35% of global net sales • WD-40® Multi-Use Product sales ▲ 23% • WD-40 Specialist ® sales ▲ 11% • In constant currency sales ▲ 11% • Maintenance product (MP) sales: • EIMEA MP sales ▲ 21% • Gross m
Slide 7: Asia-Pacific Segment
Asia-Pacific Segment Asia-Pacific – Q1 FY23 vs. Q1 FY24 $27.6 $26.1 • Total reported Asia-Pacific sales ▲ 6% • Segment = 20% of global net sales • WD-40® Multi-Use Product sales ▲ 4% • WD-40 Specialist ® sales ▲ 19% • In constant currency sales ▲ 7% • Maintenance product (MP) sales: • Australia MP s
Slide 8: Growth Aspirations
Growth Aspirations 8
Slide 9: Strong Historical Growth with Clear Runway Ahead
Strong Historical Growth with Clear Runway Ahead Maintenance Product Net Sales1 Maintenance Products ($M, Non-GAAP Constant Currency) 10-year Sales CAGR 504 469 425 318 335 355 377 364 6.0% 294 300 EIMEA 6.4% APAC 5.7% Americas FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Americas EIMEA APAC 1)
Slide 10: Long-Term Growth Targets for Maintenance Products
Long-Term Growth Targets for Maintenance Products Non-GAAP Constant Currency Long-Term Growth Ambition By Segment Americas EIMEA APAC Total Company 50% 36% 14% CAGR Target of global net sales* of global net sales* of global net sales* mid-to-high CAGR Target CAGR Target CAGR Target single digits 5-8
Slide 11: Our Four-by-Four Strategic Framework
Our Four-by-Four Strategic Framework Four Must-Win Battles 01 02 03 04 Lead Geographic Accelerate Drive WD-40 Turbo-Charge Expansion Premiumization Specialist Growth Digital Commerce Four Strategic Enablers 01 Ensure a People-First Mindset 02 Build a Sustainable Business For the Future 03 Achieve Op
Slide 12: Must-Win Battles – Q1 FY24
Must-Win Battles – Q1 FY24 Must-Win Battles Quarterly Results 01 02 03 04 Lead Geographic Accelerate Drive WD-40 Turbo-Charge Expansion Premiumization Specialist Growth Digital Commerce • WD-40 Multi-Use • WD-40 Smart Straw • WD-40 Specialist ▲ • E-commerce sales Product ▲ 14% and EZ Reach 9% ▲ 10%
Slide 13: Business Model
Business Model 13
Slide 14: Our Business Model Enables Long-term Value Creation
Our Business Model Enables Long-term Value Creation Generate Mid-to-High-Single GDP+ Digit Revenue Growth 50→55% Achieve Gross Margin Target ROIC 25%+ 35→30% Manage Cost Of Doing Business Annual dividends 20→25% Drive Adjusted EBITDA Margin targeted at >50% of earnings Low Capital Invest in Brands a
Slide 15: Gross Margin Detail – Q1 FY24
Gross Margin Detail – Q1 FY24 Gross margin improved by 240 basis points over prior year period primarily due to the following favorable impacts: Gross Margin Drivers Change vs. Prior Year Gross Margin Trend As reported (basis points) Warehousing, distribution, +150 freight, misc. input costs 53.8% S
Slide 16: What Makes Up the Cost of a Can?
What Makes Up the Cost of a Can? Approximate Cost Breakdown Of A Typical Can Of WD-40® Multi-Use Product Manufactured in the United States FY23 Corrugate Petroleum-Based Specialty 2% 37% Plastic 14% Manufacturing Fees 30% 17% Tin-Plate Can Data as of August 2023. Represents average input costs over
Slide 17: FY 2024 Guidance
FY 2024 Guidance 17
Slide 18: Reiterated Fiscal Year 2024 Guidance
Reiterated Fiscal Year 2024 Guidance Sales Growth Between 6% and 12% (Constant Currency Basis) Net Sales Between $570 and $600 million (Constant Currency Basis) Gross Margin Between 51% and 53% A&P Investment Between 5% and 6% of net sales Provision For Income Tax Between 24% and 25% Net Income Betw
Slide 19: Appendix
Appendix \ 19 &
Slide 20: Sales Impact – Consolidated Net Sales Changes
Sales Impact – Consolidated Net Sales Changes Changes from Prior Year Fiscal Period ($ in millions) Price, Volume and FX Impact Q1 FY24 Increase in average selling price(1) $ 4.1 Increase in sales volume(1) $ 7.6 Currency impact on current period – non-GAAP $ 3.8 Increase in net sales $ 15.5 1) Mana
Slide 21: Foreign Currency Translation Impact or Constant Currency – Q1 FY24
Foreign Currency Translation Impact or “Constant Currency” – Q1 FY24 ($ in millions; except EPS, gross margin and % change) Financial Results Q1 FY24 Q1 FY23 % Change As reported Net Sales $140.4 $124.9 12% Gross Margin 53.8% 51.4% +240 bps Operating Income $24.2 $18.7 29% Net Income $17.5 $14.0 25%
Slide 22: Foreign Currency Impact
Foreign Currency Impact Transaction Impact Translation Impact Conversion from transaction Translation from functional currency to subsidiaries’ functional currency to WD-40 Company’s currency reporting currency Transaction currency Functional currency Reporting currency Currency in which sales, Main
Slide 23: Additional Foreign Currency Exchange Impact – Q1 FY24
Additional Foreign Currency Exchange Impact – Q1 FY24 Q1 FY24 Net Sales (In millions) $3.9 $0.6 In total changes in FX rates increased net sales by ~$3.3M $137.1 $140.4 in Q1 FY24 Q1 FY24 Net Sales at Transaction Translation Q1 FY24 Net Sales Q1 FY23 FX Rates Impact Impact As Reported Non-GAAP 23
Slide 24: Non-GAAP Reconciliation
Non-GAAP Reconciliation This presentation contains certain non-GAAP (generally accepted accounting principles in the United States of America) measures, that management believes provide our stockholders with additional insights into WD-40 Company’s results of operations and how it runs its business.
Slide 25: Non-GAAP Reconciliation
Non-GAAP Reconciliation In order to show the impact of changes in foreign currency exchange rates on our results of operations, we have included constant currency disclosures, where necessary, in this presentation. Constant currency disclosures represent the translation of our current fiscal year re
Slide 26: Slide 26