Armstrong World Industries Inc · NYSE:AWI

Armstrong World Industries — Q4 2013 Earnings Presentation

21 slides from Armstrong World Industries's earnings presentation, Feb 24, 2014

  1. Slide 1: Earnings Call Presentation 4th Quarter 2013

    Earnings Call Presentation 4th Quarter 2013 February 24, 2014

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement Our disclosures in this presentation, including without limitation, those relating to future financial results guidance, and in our other public documents and comments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Those s

  3. Slide 3: Basis of Presentation

    All figures throughout the presentation are in $ millions unless otherwise noted. Figures may not add due to rounding. Basis of Presentation Explanation When reporting our financial results within this presentation, we make several adjustments. Management uses the non-GAAP measures below in managing

  4. Slide 4: Key Metrics - Fourth Quarter 2013

    As reported Net Sales: $661 million in 2013 and $613 million in 2012As reported Operating Income: $30 million in 2013 and $42 million in 2012As reported EPS: $0.20 in 2013 and $0.15 in 2012Cash flow information includes cash flows attributable to CabinetsUnadjusted Key Metrics - Fourth Quarter 2013

  5. Slide 5: Fourth Quarter 2013 vs. PY - Adjusted EBITDA to Reported Net Income

    2013 2012 V EBITDA- Adjusted $71 $73 ($2) Depreciation and Amortization (30) (26) (4) Operating Income - Adjusted $41 $47 ($6) Foreign Exchange Movements (2) - (2) Impairment - (1) 1 Cost Reduction Initiatives (9) (4) (5) Operating Income - As Reported $30 $42 ($12) Interest (Expense) (12) (12) - EB

  6. Slide 6: Fourth Quarter Sales and EBITDA by Segment - 2013 vs. PY

    Fourth Quarter Sales and EBITDA by Segment - 2013 vs. PY 6 (CHART)

  7. Slide 7: EBITDA Bridge - Fourth Quarter 2013 vs. Prior Year

    (CHART) EBITDA Bridge - Fourth Quarter 2013 vs. Prior Year 7 ($11) ($4)

  8. Slide 8: Free Cash Flow - Fourth Quarter 2013 vs. Prior Year

    (CHART) Free Cash Flow - Fourth Quarter 2013 vs. Prior Year 8

  9. Slide 9: Key Metrics - Full Year 2013

    As reported Net Sales: $2,720 million in 2013 and $2,619 million in 2012.As reported Operating Income: $239 million in 2013 and $271 million in 2012As reported EPS: $1.71 in 2013 and $ 2.41 in 2012.Cash flow information includes cash flows attributable to CabinetsUnadjusted 2013 Actual 2012 Actual V

  10. Slide 10: Full Year Sales and EBITDA by Segment - 2013 vs. PY

    (CHART) Full Year Sales and EBITDA by Segment - 2013 vs. 2012 10

  11. Slide 11: EBITDA Bridge - Full Year 2013 vs. Prior Year

    (CHART) $16 EBITDA Bridge - Full Year 2013 vs. Prior Year 11 ($23) ($9) $29 $6

  12. Slide 12: Free Cash Flow - Full Year 2013 vs. Prior Year

    (CHART) Free Cash Flow - Full Year 2013 vs. Prior Year 12 ($19) ($2) ($3)

  13. Slide 13: Key Metrics - Guidance 2014

    2014 Estimate Range (1) 2014 Estimate Range (1) 2014 Estimate Range (1) 2013 (2) Variance Variance Variance Net Sales(3) 2,800 to 2,900 2,720 3% to 7% Operating Income(4) 275 to 300 262 5% to 15% EBITDA 400 to 430 371 8% to 16% Earnings Per Share(5) $2.55 to $2.80 $2.04 25% to 37% Free Cash Flow 60

  14. Slide 14: 2014 Financial Outlook

    2014 Financial Outlook $20 - $30 million vs. 2013Adjusted Gross Margin 100 to 150 bps vs. 201316.3% to 16.8% of sales$0 - $5 million vs. 2013 $30 - $40 million; Adjusted long-term ETR of ~39%(2) Sales(1) $625- $665 million; EBITDA $75 - $90 million $180 - $200 million < $5 million Raw Material & Ene

  15. Slide 15: Appendix

    Appendix 15

  16. Slide 16: Divested Businesses

    CabinetsAnnounced sale in Q3 2012 and finalized sale in Q4 2012Treated as discontinued operation starting with Q3 2012PatriotCompleted sale in Q3 2012Results included in the Wood Flooring segment 16 Divested Businesses Patriot impact on Y-o-Y Comparisons Q3 2012 Q4 2012 2012 1H 2013 Q3 2013 2013 Net

  17. Slide 17: Full Year 2013 vs. PY - Adjusted EBITDA to Reported Net Income

    2013 2012 V EBITDA- Adjusted $371 $402 ($31) Depreciation and Amortization (109) (100) (9) Operating Income - Adjusted $262 $302 ($40) Foreign Exchange Movements (5) - (5) Cost Reduction Initiatives (18) (13) (5) Accelerated Depreciation and Impairments (not included above) - (12) 12 Impairment - (6

  18. Slide 18: Adjusted Operating Income to Free Cash Flow

    2014 Estimate Range 2014 Estimate Range 2014 Estimate Range Adjusted Operating Income 275 to 300 D&A 125 to 130 Adjusted EBITDA 400 to 425 Changes in Working Capital (50) to (60) Capex (180) to (200) Interest Expense (45) to (50) Cash Taxes (30) to (40) Other, including cash payments for restructuri

  19. Slide 19: Reported to Adjusted Net Sales, Operating Income and EPS

    Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter 2013 Reported Comparability(1) Adjustments FX(2) Adj 2013 Adjusted 2012 Reported Comparability(1) Adjustments FX(2) Adj 2012 Adjusted 2012 Adjusted Ne

  20. Slide 20: Segment Operating Income

    Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter Fourth Quarter 2013 Reported Comparability(1) Adjustments 2013 Adjusted 2012 Reported Comparability(1) Adjustments 2012 Adjusted Building Products 52 2 54 52 2 54 Resilient Flooring (2) 9 7 (1) - (1) Wood Floor

  21. Slide 21: Cash Flow

    Fourth Quarter Fourth Quarter Full Year Full Year ($ millions) 2013 2012 2013 2012 Net cash from operations $52 $79 $214 $220 Net cash (used for) investing (59) (30) (146) (92) Add back (subtract) adjustments to reconcile to free cash flow Restricted cash - - - (1) Divestiture - (25) - (39) Free Cas

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