Siteone Landscape Supply, Inc. · NYSE:SITE
Siteone Landscape Supply — Q4 2017 Earnings Presentation
21 slides from Siteone Landscape Supply's earnings presentation, February 2018
Slide 1: Fourth Quarter 2017 Earnings
Fourth Quarter 2017 Earnings
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to our 2017 Adjusted EBITDA outlook. S
Slide 3: Conference call agenda
Conference call agenda Introduction Pascal Convers, EVP S&D and IR Business Update Doug Black, Chairman and CEO Financial Update John Guthrie, CFO Development Update Pascal Convers, EVP S&D and IR Closing & Outlook Doug Black, Chairman and CEO Q&A 3
Slide 4: Company and industry overview
Company and industry overview ■ Largest and only national wholesale distributor of landscape supplies ■ Large $18 billion highly fragmented market ■ More than four times the size of next competitor and only ~10% market share(1) ■ Serving residential and commercial landscape professionals Distributio
Slide 5: SiteOne is poised for long-term growth and margin enhancement
SiteOne is poised for long-term growth and margin enhancement Current strategy Leverage strengths of both large and local company ■ Fully exploit our scale, resources and capabilities ■ Execute local market growth strategies ■ Deliver superior value to our customers and suppliers ■ Close and integ
Slide 6: Accelerating performance and growth led by recent transformation
Accelerating performance and growth led by recent transformation 2005 2016 (May) Acquired UGM 2013 (Q4) Initial public offering CD&R acquired 60% of JDL Strategy 2017 (August) & Brand Development Deere & CD&R fully divested 2014 2015 2016 2018YTD 2001 2007 2017 New Management Acquired Acquired Acqui
Slide 7: Fiscal Year 2017 highlights and recent developments
Fiscal Year 2017 highlights and recent developments Fiscal Year 2017 highlights: Net sales increased by 13% to $1.86 billion Organic Daily Sales increased by 5% Gross profit increased 15% to $595.5 million; gross margin expanded by 70 bps to 32.0% Net income for the year was $54.6 million, c
Slide 8: Fiscal Year 2017 and Fourth Quarter 2017 financial results
Fiscal Year 2017 and Fourth Quarter 2017 financial results Financial performance Fiscal Year 2017 highlights Net sales ($M) Net sales increased by 13% to $1.86 billion 2,400 +13% 1,862 Organic Daily Sales increased by 5% 1,800 1,648 1,200 Acquisitions contributed ~$135 million of growth +15% 6
Slide 9: Fiscal Year 2017 and Fourth Quarter 2017 financial results
Fiscal Year 2017 and Fourth Quarter 2017 financial results Financial performance Fiscal Year 2017 highlights Net Income ($M) Net income for the year was $54.6 million, +78% compared to $30.6 million in 2016 60 54.6 50 Adjusted EBITDA increased 17% to $157.2 million, 40 30.6 compared to $134.3 mi
Slide 10: Balance sheet & cash flow highlights
Balance sheet & cash flow highlights For the year ended December 31,2017 Balance sheet & cash flow highlights ($ in millions) ■ Working Capital increased 30% YoY to $396.1 million – Higher receivables reflect strong 4th quarter sales growth organically and from acquisitions Net debt1 $458.6 – Carryi
Slide 11: Robust track record of acquisitions
Robust track record of acquisitions 2014 2015 2016 2017 2018YTD Total Eljay Shemin Hydro-Scape Aspen Valley Pete Rose Diamond Head AMC Blue Max Stone Forest Atlantic Irrigation Stockyard Green Resource Bissett Angelo's BISCO Tieco Glen Allen AB Supply Loma Vista
Slide 12: M&A strategy continues to gain momentum
M&A strategy continues to gain momentum Harmony Gardens Ft. Collins Closed in October 2017 Leading nursery position in Colorado Allows for full product line offering to local customers Cross-sell SiteOne full suite of products Purchasing synergies Denver SiteOne existing Harmony Gardens Co
Slide 13: M&A strategy continues to gain momentum
M&A strategy continues to gain momentum Pete Rose Closed in January 2018 Leading hardscapes position in Richmond, VA Allows for full product line offering to local customers Cross-sell SiteOne full suite of products SiteOne existing Pete Rose Source: Company data 13
Slide 14: M&A strategy continues to gain momentum
M&A strategy continues to gain momentum Atlantic Irrigation Atlantic Irrigation (33 locations) Source: Company data 14
Slide 15: Atlantic Irrigation acquisition
Atlantic Irrigation acquisition Company Overview History of Atlantic Irrigation Growth Closed in February 2018 1976 Opened Deer Park, Long Island- First Location Leading supplier of Irrigation products along the East Coast 1987 -1996 Established in 1976 by Ed Santalone Sr Expanded with 12 loca
Slide 16: Robust pipeline provides significant growth opportunity
Robust pipeline provides significant growth opportunity SiteOne is the leading industry consolidator 10% Significant sourcing advantage with 70+ associates scouting 90% Our pipeline is deep and rapidly expanding ~$16bn(1) opportunity M&A team in place to execute larger pipeline Acquisition
Slide 17: 2018 outlook
2018 outlook Underlying market trends remain positive Market share gains expected to continue Continued EBITDA margin expansion M&A activity continues to gain momentum from a robust pipeline 2018 Adjusted EBITDA expectation of $180 million to $192 million 17
Slide 18: Investment highlights
Investment highlights Uniquely Clear market leader attractive industry Compelling and Proven management sustainable team growth strategy Operational and Value-creating commercial acquisitions excellence 18
Slide 19: Appendix
Appendix 19
Slide 20: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation 2017 2016 ($ in millions) Year Q4 ‘17 Q3 ‘17 Q2 ‘17 Q1 ‘17 Year Q4 ‘16 Q3 ‘16 Q2 ‘16 Q1 ‘16 Net income 54.6 4.0 16.9 44.2 (10.5) 30.6 (5.6) 14.9 26.9 (5.6) Income tax expense (benefit) 18.0 (11.4) 10.7 26.3 (7.6) 21.3 (4.1) 10.7 18.1 (3.4) Inte
Slide 21: Non-GAAP reconciliations
Non-GAAP reconciliations Organic Daily Sales Reconciliation 2017 2016 ($ in millions) Year Q4 ‘17 Q3 ‘17 Q2 ‘17 Q1 ‘17 Year Q4 ‘16 Q3 ‘16 Q2 ‘16 Q1 ‘16 Net Sales $1,861.7 $415.7 $502.4 $608.6 $335.0 $1,648.2 $361.8 $444.5 $513.4 $328.5 Organic Sales $1,694.0 $370.0 $457.4 $548.1 $318.5 $1,615.5 $346
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