Slide 1: Second Quarter 2021 Results
August 5, 2021 Second Quarter 2021 Results
Slide 2: Important information
Important information Caution Regarding Forward Looking Statements This presentation or any other oral or written statements made by us or on our behalf may include forward-looking statements that reflect our current views with respect to future events and financial performance. These statements may
Slide 3: CEO quote on CommScope NEXT strategy
“Looking ahead, while we expect these challenges to continue, with our strong demand environment and ability to adapt, we remain confident in our ability to build on our track record of value creation and to successfully execute our CommScope NEXT strategy.” Chuck Treadway President and Chief Execut
Slide 4: Key drivers of CommScope's ongoing evolution
Key drivers of CommScope’s ongoing evolution CommScope has Well-positioned to Infrastructure and Leaning into built a leading take advantage of networking markets the strength of technology portfolio some of the most starting to normalize CommScope’s powerful tailwinds in people and desire to the co
Slide 5: Second quarter highlights
Second quarter highlights Core CommScope Home Networks Broadband Networks, Venue and Campus Networks, • Transitory supply challenges for Outdoor Wireless Networks semiconductors impact ability to • Broadband Networks serve robust demand Strength in node splitting, fiber cabling and connectivity; • L
Slide 6: Expect to generate at least $500 million in non-GAAP adjusted EBITDA
Expect to generate at least $500 million in non-GAAP adjusted EBITDA We are generating new We are capitalizing on growth opportunities our cost optimization • “Fiber everywhere”, home opportunities broadband competition and • ~$500 million of annual government stimulus fueling indirect spend opportu
Slide 7: CFO quote on growth, cost control and portfolio optimization
“CommScope continues to position itself to reinvest in our core strategic markets and technologies, capitalizing on growth opportunities in our Broadband, Outdoor Wireless and Venue and Campus segments. As we move into the second half of the year, growth, cost control and portfolio optimization will
Slide 8: Consolidated and Core CommScope results
Core CommScope Consolidated CommScope Core CommScope (1) (In $millions, except per share amounts) (In $millions) 2Q’20 2Q’21 Y/Y Change 2Q’20 2Q’21 Y/Y Change Results Results Results Results Net Sales (2) $2,103 $2,185 +3.9% Net Sales (2) $1,468 $1,729 +17.8% Adj. EBITDA(3) $280 $308 +10% Adj. EBITD
Slide 9: Broadband Networks
Broadband Networks Financial Highlights Business Business Highlights Highlights Net Sales (1) ($M) • Net sales growth in all regions except • Continued strength in order entry and growing backlog Asia-Pacific 2Q'20 $661 • Growth within both Network Cable & • Meaningful progress in build direction fo
Slide 10: Venue and Campus Networks
Venue and Campus Networks Financial Highlights Business Highlights Net Sales (1) ($M) • Net sales growth across all regions • Copper growth fueled by normalizing infrastructure spend • Growth in indoor copper, fiber and and government stimulus projects 2Q'20 $479 RUCKUS • Growth in multi-tenant and
Slide 11: Outdoor Wireless Networks
Outdoor Wireless Networks Financial Highlights Business Highlights Net Sales ($M) • Net sales growth primarily driven by • North America 5G activity gaining traction; initial focus North America and Asia-Pacific on site preparations 2Q'20 $328 • Growth in both macro towers and metro layer • Growing
Slide 12: Home Networks
Home Networks Financial Highlights Business Highlights Net Sales (1) ($M) • Net sales declines across all regions • Planned spin-off progressing; on track to complete spin-off except Middle East and Africa during second quarter 2022; creating standalone organization 2Q'20 $635 • Declines in both vid
Slide 13: Cash flow update
Cash flow update GAAP Cash Flow from Operations ($M) Adj. Free Cash Flow(1) ($M) $209 $217 $192 $176 $198 $172 $98 $65 ($135) $(124) 2Q’20 3Q’20 4Q’20 1Q’21 2Q’21 2Q’20 3Q’20 4Q’20 1Q’21 2Q’21 • Second quarter working capital was net usage of cash, primarily driven by inventory • Expect seasonally s
Slide 14: Strong liquidity & de-risked capital structure
Strong liquidity & de-risked capital structure Debt Maturities (as of 06/30/2021) Proactive balance sheet management provides runway before next Secured Debt Unsecured Debt ($ millions) significant debt maturities ABL 6.00% Notes due 2025 • Since close of ARRIS acquisition, CommScope Term Loan B 5.0
Slide 15: End-market demand
End-market demand Market Demand Outlook 2H’21 Demand Drivers Broadband Continued operator network Footprint expansion, driving “fiber investment; focus shifting to network deeper” and “RDOF” build plans Networks edge materializing Cloud migration drives MTDC and hyperscale Firming infrastructure and
Slide 16: Q&A
Q&A Second Quarter 2021 Results © 2021 CommScope, Inc. All rights reserved. | CommScope, ARRIS and the ARRIS logo are trademarks of CommScope, Inc. and/or its affiliates. All other trademarks are the property of their respective owners.
Slide 17: Appendix
COMMSCOPE’ Appendix
Slide 18: Condensed Consolidated Statements of Operations
CommScope Holding Company, Inc. Condensed Consolidated Statements of Operations (Unaudited -- In millions, except per share amounts) Statements of Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Operations Net sales Cost of sales $ 2,185.3 1,512.0 $ 2,102.8 1,446.7 $ 4,257.
Slide 19: Condensed Consolidated Balance Sheets
CommScope Holding Company, Inc. Condensed Consolidated Balance Sheets (In millions, except share amounts) Unaudited June 30, 2021 December 31, 2020 Balance Sheets Cash and cash equivalents Assets Accounts receivable, less allowance for doubtful accounts of $ 446.2 $ 521.9 $30.8 and $40.3, respective
Slide 20: Condensed Consolidated Statements of Cash Flows
CommScope Holding Company, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited -- In millions) Statements of Cash Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Flows Operating Activities: Net loss Adjustments to reconcile net loss to $ (153.8) $ (321.1) $ (251
Slide 21: Adjusted EBITDA and Adjusted Net Income Reconciliation
CommScope Holding Company, Inc. Reconciliation of GAAP Measures to Non-GAAP Adjusted Measures (Unaudited -- In millions, except per share amounts) Three Months S ix Months Ended Ended Adjusted EBITDA and Net loss, as reported June 30, 2021 $ (153.8) 2020 $ (321.1) 2021 June 30, $ (251.4) 2020 $ (481
Slide 22: Sales by Region
CommScope Holding Company, Inc. Sales by Region Sales by Region (Unaudited -- In millions) Sales by Region % Change Q2 2021 Q2 2020 YOY United States $ 1,254.2 $ 1,353.6 (7.3) % Europe, Middle East and Africa 408.8 359.0 13.9 Asia Pacific 244.1 201.9 20.9 Caribbean and Latin America 190.3 124.0 53.5
Slide 23: Sales and Adjusted EBITDA by Segment
CommScope Holding Company, Inc. Sales and Adjusted Segment Information (Unaudited -- In millions) EBITDA by Segment Segment Net Sales % Change Q2 2021 Q2 2020 YOY Broadband $ 807.9 $ 660.6 22.3 % Outdoor Wireless 358.1 328.4 9.0 Venue and Campus 562.8 478.5 17.6 (1) Core net sales 1,728.8 1,467.5 17
Slide 24: Adjusted EBITDA Reconciliation by Segment
CommScope Holding Company, Inc. Reconciliation of GAAP to Segment Adjusted EBITDA (Unaudited -- In millions) Adjusted EBITDA Second Quarter 2021 Segment Adjusted EBITDA Reconciliation Outdoor Venue and Reconciliation by Operating income (loss), as reported $ Broadband (35.1) $ Wireless 64.0 $ Campus
Slide 25: Adjusted Free Cash Flow Reconciliation
Adjusted Free Cash CommScope Holding Company, Inc. Adjusted Free Cash Flow (Unaudited -- In millions) Flow Reconciliation Adjusted Free Cash Flow Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Cash flow from operations $ 209.1 $ 172.2 $ 97.7 $ (124.0) $ 191.6 Capital expenditures (23.8) (25.8) (47.7) (26.4
Slide 26: Adjusted Gross Profit and Adjusted Operating Expense Reconciliations
CommScope Holding Company, Inc. Quarterly Adjusted Gross Profit and Adjusted Operating Expense (Unaudited -- In millions) Adjusted Gross Profit GAAP to Non-GAAP Adjusted Gross Profit and Adjusted Operating Expense Reconciliations Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Gross profit, as reported $ 65
Slide 27: New Segment 2020 and 2019 Financial Information
New Segment CommScope Holding Company, Inc. New Segment Information 2020 and 2019 Segment Net Sales (1) (Unaudited -- In millions) Financial Information Q1 2020 Q2 2020 Q3 2020 Q4 2020 Full Year 2020 Full Year 2019 Broadband $ 598.1 $ 660.6 $ 811.0 $ 778.2 $ 2,848.2 $ 2,324.0 Outdoor Wireless 348.9